Document:

ex4_8.htm

    
      
        

      

    

    
      Exhibit
        4.8

      

      SUBSIDIARY
        GUARANTEE

      

      SUBSIDIARY
        GUARANTEE, dated as of December  __, 2007 (this “Guarantee”), made
        by
        each of the signatories hereto (together with any other entity that may become
        a
        party hereto as provided herein, the “Guarantors”), in
        favor of the purchasers signatory (the “Purchasers”) to that
        certain Securities Purchase Agreement, dated as of the date hereof, between
        uVuMobile, Inc., a Delaware corporation (the “Company”) and the
        Purchasers.

       

      

      W
        I T N E S S E T
        H:

      

      WHEREAS,
        pursuant to that certain Securities Purchase Agreement, dated as of the date
        hereof, by and between the Company and the Purchasers (the “Purchase Agreement”),
        the Company has agreed to sell and issue to the Purchasers, and the Purchasers
        have agreed to purchase from the Company the Company’s Secured Convertible
        Debentures, due December __, 2009 (the “Debentures”), subject
        to the terms and conditions set forth therein; and

      

      WHEREAS,
        each Guarantor will directly benefit from the extension of credit to the
        Company
        represented by the issuance of the Debentures; and

      

      NOW,
        THEREFORE, in consideration of the premises and to induce the Purchasers
        to
        enter into the Purchase Agreement and to carry out the transactions contemplated
        thereby, each Guarantor hereby agrees with the Purchasers as
        follows:

      

      1.           Definitions.
        Unless
        otherwise defined herein, terms defined in the Purchase Agreement and used
        herein shall have the meanings given to them in the Purchase Agreement. The
        words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import
        when used in this Guarantee shall refer to this Guarantee as a whole and
        not to
        any particular provision of this Guarantee, and Section and Schedule references
        are to this Guarantee unless otherwise specified. The meanings given to terms
        defined herein shall be equally applicable to both the singular and plural
        forms
        of such terms.  The following terms shall have the following
        meanings:

      

      “Guarantee”
means
        this
        Subsidiary Guarantee, as the same may be amended, supplemented or otherwise
        modified from time to time.

      

      “Obligations”
means,
        in addition to all other costs and expenses of collection incurred by Purchasers
        in enforcing any of such Obligations and/or this Guarantee, all of the
        liabilities and obligations (primary, secondary, direct, contingent, sole,
        joint
        or several) due or to become due, or that are now or may be hereafter contracted
        or acquired, or owing to, of any Debtor to the Secured Parties, including,
        without limitation, all obligations under this Agreement, the Debentures,
        this
        Guarantee and any other instruments, agreements or other documents executed
        and/or delivered in connection herewith or therewith, in each case, whether
        now
        or hereafter existing, voluntary or involuntary, direct or indirect, absolute
        or
        contingent, liquidated or unliquidated, whether or not jointly owed with
        others,
        and whether or not from time to time decreased or extinguished and later
        increased, created or incurred, and all or any portion of such obligations
        or
        liabilities that are paid, to the extent all or any part of such payment
        is
        avoided or recovered directly or indirectly from any of the Secured Parties
        as a
        preference, fraudulent transfer or otherwise as such obligations may be amended,
        supplemented, converted, extended or modified from time to
        time.  Without limiting the generality of the foregoing, the term
“Obligations” shall include, without limitation: (i) principal of, and interest
        on the Debentures and the loans extended pursuant thereto; (ii) any and all
        other fees, indemnities, costs, obligations and liabilities of the Debtors
        from
        time to time under or in connection with this Agreement, the Debentures,
        the
        Guarantee and any other instruments, agreements or other documents executed
        and/or delivered in connection herewith or therewith; and (iii) all amounts
        (including but not limited to post-petition interest) in respect of the
        foregoing that would be payable but for the fact that the obligations to
        pay
        such amounts are unenforceable or not allowable due to the existence of a
        bankruptcy, reorganization or similar proceeding involving any
        Debtor.

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      2.           Guarantee.

      

      (a)           Guarantee.

      

      
        	
                 

              	
                (i)

              	
                The
                  Guarantors hereby, jointly and severally, unconditionally and irrevocably,
                  guarantee to the Purchasers and their respective successors, indorsees,
                  transferees and assigns, the prompt and complete payment and performance
                  by the Company when due (whether at the stated maturity, by acceleration
                  or otherwise) of the Obligations.

              

      

      

      
        	
                 

              	
                (ii)

              	
                Anything
                  herein or in any other Transaction Document to the contrary
                  notwithstanding, the maximum liability of each Guarantor hereunder
                  and
                  under the other Transaction Documents shall in no event exceed
                  the amount
                  which can be guaranteed by such Guarantor under applicable federal
                  and
                  state laws, including laws relating to the insolvency of debtors,
                  fraudulent conveyance or transfer or laws affecting the rights
                  of
                  creditors generally (after giving effect to the right of contribution
                  established in Section 2(b)).

              

      

      

      
        	
                 

              	
                (iii)

              	
                Each
                  Guarantor agrees that the Obligations may at any time and from
                  time to
                  time exceed the amount of the liability of such Guarantor hereunder
                  without impairing the guarantee contained in this Section 2 or
                  affecting
                  the rights and remedies of the Purchasers
                  hereunder.

              

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (iv)

              	
                The
                  guarantee contained in this Section 2 shall remain in full force
                  and
                  effect until all the Obligations and the obligations of each Guarantor
                  under the guarantee contained in this Section 2 shall have been
                  satisfied
                  by payment in full.

              

      

      

      
        	
                 

              	
                (v)

              	
                No
                  payment made by the Company, any of the Guarantors, any other guarantor
                  or
                  any other Person or received or collected by the Purchasers from
                  the
                  Company, any of the Guarantors, any other guarantor or any other
                  Person by
                  virtue of any action or proceeding or any set-off or appropriation
                  or
                  application at any time or from time to time in reduction of or
                  in payment
                  of the Obligations shall be deemed to modify, reduce, release or
                  otherwise
                  affect the liability of any Guarantor hereunder which shall,
                  notwithstanding any such payment (other than any payment made by
                  such
                  Guarantor in respect of the Obligations or any payment received
                  or
                  collected from such Guarantor in respect of the Obligations), remain
                  liable for the Obligations up to the maximum liability of such
                  Guarantor
                  hereunder until the Obligations are paid in
                  full.

              

      

      

      
        	
                 

              	
                (vi)

              	
                Notwithstanding
                  anything to the contrary in this Agreement, with respect to any
                  defaulted
                  non-monetary Obligations the specific performance of which by the
                  Guarantors is not reasonably possible (e.g. the issuance of the
                  Company's
                  Common Stock), the Guarantors shall only be liable for making the
                  Purchasers whole on a monetary basis for the Company's failure
                  to perform
                  such Obligations in accordance with the Transaction
                  Documents.

              

      

      

      (b)           Right
        of
        Contribution. Each Guarantor hereby agrees that to the extent that a
        Guarantor shall have paid more than its proportionate share of any payment
        made
        hereunder, such Guarantor shall be entitled to seek and receive contribution
        from and against any other Guarantor hereunder which has not paid its
        proportionate share of such payment. Each Guarantor's right of contribution
        shall be subject to the terms and conditions of Section 2(c). The provisions
        of
        this Section 2(b) shall in no respect limit the obligations and liabilities
        of
        any Guarantor to the Purchasers, and each Guarantor shall remain liable to
        the
        Purchasers for the full amount guaranteed by such Guarantor
        hereunder.

      

      (c)           No
        Subrogation.  Notwithstanding any payment made by any Guarantor
        hereunder or any set-off or application of funds of any Guarantor by the
        Purchasers, no Guarantor shall be entitled to be subrogated to any of the
        rights
        of the Purchasers against the Company or any other Guarantor or any collateral
        security or guarantee or right of offset held by the Purchasers for the payment
        of the Obligations, nor shall any Guarantor seek or be entitled to seek any
        contribution or reimbursement from the Company or any other Guarantor in
        respect
        of payments made by such Guarantor hereunder, until all amounts owing to
        the
        Purchasers by the Company on account of the Obligations are paid in full.
        If any
        amount shall be paid to any Guarantor on account of such subrogation rights
        at
        any time when all of the Obligations shall not have been paid in full, such
        amount shall be held by such Guarantor in trust for the Purchasers, segregated
        from other funds of such Guarantor, and shall, forthwith upon receipt by
        such
        Guarantor, be turned over to the Purchasers in the exact form received by
        such
        Guarantor (duly indorsed by such Guarantor to the Purchasers, if required),
        to
        be applied against the Obligations, whether matured or unmatured, in such
        order
        as the Purchasers may determine.

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (d)           Amendments,
        Etc. With
        Respect to the Obligations. Each Guarantor shall remain obligated
        hereunder notwithstanding that, without any reservation of rights against
        any
        Guarantor and without notice to or further assent by any Guarantor, any demand
        for payment of any of the Obligations made by the Purchasers may be rescinded
        by
        the Purchasers and any of the Obligations continued, and the Obligations,
        or the
        liability of any other Person upon or for any part thereof, or any collateral
        security or guarantee therefor or right of offset with respect thereto, may,
        from time to time, in whole or in part, be renewed, extended, amended, modified,
        accelerated, compromised, waived, surrendered or released by the Purchasers,
        and
        the Purchase Agreement and the other Transaction Documents and any other
        documents executed and delivered in connection therewith may be amended,
        modified, supplemented or terminated, in whole or in part, as the Purchasers
        may
        deem advisable from time to time, and any collateral security, guarantee
        or
        right of offset at any time held by the Purchasers for the payment of the
        Obligations may be sold, exchanged, waived, surrendered or released. The
        Purchasers shall have no obligation to protect, secure, perfect or insure
        any
        Lien at any time held by them as security for the Obligations or for the
        guarantee contained in this Section 2 or any property subject
        thereto.

      

      (e)           Guarantee
        Absolute and
        Unconditional. Each Guarantor waives any and all notice of the creation,
        renewal, extension or accrual of any of the Obligations and notice of or
        proof
        of reliance by the Purchasers upon the guarantee contained in this Section
        2 or
        acceptance of the guarantee contained in this Section 2; the Obligations,
        and
        any of them, shall conclusively be deemed to have been created, contracted
        or
        incurred, or renewed, extended, amended or waived, in reliance upon the
        guarantee contained in this Section 2; and all dealings between the Company
        and
        any of the Guarantors, on the one hand, and the Purchasers, on the other
        hand,
        likewise shall be conclusively presumed to have been had or consummated in
        reliance upon the guarantee contained in this Section 2. Each Guarantor waives
        to the extent permitted by law diligence, presentment, protest, demand for
        payment and notice of default or nonpayment to or upon the Company or any
        of the
        Guarantors with respect to the Obligations. Each Guarantor understands and
        agrees that the guarantee contained in this Section 2 shall be construed
        as a
        continuing, absolute and unconditional guarantee of payment without regard
        to
        (a) the validity or enforceability of the Purchase Agreement or any other
        Transaction Document, any of the Obligations or any other collateral security
        therefor or guarantee or right of offset with respect thereto at any time
        or
        from time to time held by the Purchasers, (b) any defense, set-off or
        counterclaim (other than a defense of payment or performance or fraud or
        misconduct by Purchasers) which may at any time be available to or be asserted
        by the Company or any other Person against the Purchasers, or (c) any other
        circumstance whatsoever (with or without notice to or knowledge of the Company
        or such Guarantor) which constitutes, or might be construed to constitute,
        an
        equitable or legal discharge of the Company for the Obligations, or of such
        Guarantor under the guarantee contained in this Section 2, in bankruptcy
        or in
        any other instance. When making any demand hereunder or otherwise pursuing
        its
        rights and remedies hereunder against any Guarantor, the Purchasers may,
        but
        shall be under no obligation to, make a similar demand on or otherwise pursue
        such rights and remedies as they may have against the Company, any other
        Guarantor or any other Person or against any collateral security or guarantee
        for the Obligations or any right of offset with respect thereto, and any
        failure
        by the Purchasers to make any such demand, to pursue such other rights or
        remedies or to collect any payments from the Company, any other Guarantor
        or any
        other Person or to realize upon any such collateral security or guarantee
        or to
        exercise any such right of offset, or any release of the Company, any other
        Guarantor or any other Person or any such collateral security, guarantee
        or
        right of offset, shall not relieve any Guarantor of any obligation or liability
        hereunder, and shall not impair or affect the rights and remedies, whether
        express, implied or available as a matter of law, of the Purchasers against
        any
        Guarantor. For the purposes hereof, “demand” shall include the commencement and
        continuance of any legal proceedings.

      
        
          
          

        

        
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      (f)           Reinstatement.
        The
        guarantee contained in this Section 2 shall continue to be effective, or
        be
        reinstated, as the case may be, if at any time payment, or any part thereof,
        of
        any of the Obligations is rescinded or must otherwise be restored or returned
        by
        the Purchasers upon the insolvency, bankruptcy, dissolution, liquidation
        or
        reorganization of the Company or any Guarantor, or upon or as a result of
        the
        appointment of a receiver, intervenor or conservator of, or trustee or similar
        officer for, the Company or any Guarantor or any substantial part of its
        property, or otherwise, all as though such payments had not been
        made.

      

      (g)           Payments.
        Each
        Guarantor hereby guarantees that payments hereunder will be paid to the
        Purchasers without set-off or counterclaim in U.S. dollars at the address
        set
        forth or referred to in the Purchase Agreement.

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      3.           Representations
        and
        Warranties. Each Guarantor hereby makes the following representations and
        warranties to Purchasers as of the date hereof:

      

      (a)           Organization
        and
        Qualification. The Guarantor is a corporation, duly incorporated, validly
        existing and in good standing under the laws of the applicable jurisdiction
        set
        forth on Schedule 1, with the requisite corporate power and authority to
        own and
        use its properties and assets and to carry on its business as currently
        conducted. The Guarantor has no subsidiaries other than those identified
        as such
        on the Disclosure Schedules to the Purchase Agreement. The Guarantor is duly
        qualified to do business and is in good standing as a foreign corporation
        in
        each jurisdiction in which the nature of the business conducted or property
        owned by it makes such qualification necessary, except where the failure
        to be
        so qualified or in good standing, as the case may be, could not, individually
        or
        in the aggregate, (x) adversely affect the legality, validity or enforceability
        of any of this Guaranty in any material respect, (y) have a material adverse
        effect on the results of operations, assets, prospects, or financial condition
        of the Guarantor or (z) adversely impair in any material respect the Guarantor's
        ability to perform fully on a timely basis its obligations under this Guaranty
        (a “Material Adverse
        Effect”).

      

      (b)           Authorization;
        Enforcement.  The Guarantor has the requisite corporate power
        and authority to enter into and to consummate the transactions contemplated
        by
        this Guaranty, and otherwise to carry out its obligations hereunder. The
        execution and delivery of this Guaranty by the Guarantor and the consummation
        by
        it of the transactions contemplated hereby have been duly authorized by all
        requisite corporate action on the part of the Guarantor. This Guaranty has
        been
        duly executed and delivered by the Guarantor and constitutes the valid and
        binding obligation of the Guarantor enforceable against the Guarantor in
        accordance with its terms, except as such enforceability may be limited by
        applicable bankruptcy, insolvency, reorganization, moratorium, liquidation
        or
        similar laws relating to, or affecting generally the enforcement of, creditors'
        rights and remedies or by other equitable principles of general
        application.

      

      (c)           No
        Conflicts. The
        execution, delivery and performance of this Guaranty by the Guarantor and
        the
        consummation by the Guarantor of the transactions contemplated thereby do
        not
        and will not (i) conflict with or violate any provision of its Certificate
        of
        Incorporation or By-laws or (ii) conflict with, constitute a default (or
        an
        event which with notice or lapse of time or both would become a default)
        under,
        or give to others any rights of termination, amendment, acceleration or
        cancellation of, any agreement, indenture or instrument to which the Guarantor
        is a party, or (iii) result in a violation of any law, rule, regulation,
        order,
        judgment, injunction, decree or other restriction of any court or governmental
        authority to which the Guarantor is subject (including Federal and state
        securities laws and regulations), or by which any material property or asset
        of
        the Guarantor is bound or affected, except in the case of each of clauses
        (ii)
        and (iii), such conflicts, defaults, terminations, amendments, accelerations,
        cancellations and violations as could not, individually or in the aggregate,
        have or result in a Material Adverse Effect. The business of the Guarantor
        is
        not being conducted in violation of any law, ordinance or regulation of any
        governmental authority, except for violations which, individually or in the
        aggregate, do not have a Material Adverse Effect.

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      (d)           Consents
        and
        Approvals. The Guarantor is not required to obtain any consent, waiver,
        authorization or order of, or make any filing or registration with, any court
        or
        other federal, state, local, foreign or other governmental authority or other
        person in connection with the execution, delivery and performance by the
        Guarantor of this Guaranty.

      

      (e)           Purchase
        Agreement.
        The representations and warranties of the Company set forth in the Purchase
        Agreement as they relate to such Guarantor, each of which is hereby incorporated
        herein by reference, are true and correct as of each time such representations
        are deemed to be made pursuant to such Purchase Agreement, and the Purchasers
        shall be entitled to rely on each of them as if they were fully set forth
        herein, provided that each reference in each such representation and warranty
        to
        the Company's knowledge shall, for the purposes of this Section 3, be deemed
        to
        be a reference to such Guarantor's knowledge.

      

      (f)           Foreign
        Law.  Each Guarantor has consulted with appropriate foreign
        legal counsel with respect to any of the above representations for which
        non-U.S. law is applicable. Such foreign counsel have advised each applicable
        Guarantor that such counsel knows of no reason why any of the above
        representations would not be true and accurate. Such foreign counsel were
        provided with copies of this Subsidiary Guarantee and the Transaction Documents
        prior to rendering their advice.

      

      4.           Covenants.

      

      (a)         Each
        Guarantor covenants and agrees with the Purchasers that, from and after the
        date
        of this Guarantee until the Obligations shall have been paid in full, such
        Guarantor shall take, and/or shall refrain from taking, as the case may be,
        each
        commercially reasonable action that is necessary to be taken or not taken,
        as
        the case may be, so that no Event of Default is caused by the failure to
        take
        such action or to refrain from taking such action by such
        Guarantor.

      

      (b)         So
        long as any of the Obligations are outstanding, unless Purchasers holding
        at
        least 85% of the aggregate principal amount of the then outstanding Debentures
        shall otherwise consent in writing, each Guarantor will not directly or
        indirectly on or after the date of this Guarantee:

      

      i.           other
        than Permitted Indebtedness (as defined in the Debentures) enter into, create,
        incur, assume or suffer to exist any indebtedness for borrowed money of any
        kind, including but not limited to, a guarantee, on or with respect to any
        of
        its property or assets now owned or hereafter acquired or any interest therein
        or any income or profits therefrom;

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      

      ii.           other
        than Permitted Liens (as defined in the Debentures) enter into, create, incur,
        assume or suffer to exist any liens of any kind, on or with respect to any
        of
        its property or assets now owned or hereafter acquired or any interest therein
        or any income or profits therefrom;

      

      iii.           amend
        its certificate of incorporation, bylaws or other charter documents so as
        to
        adversely affect any rights of the Holder hereunder;

      

      iv.           repay,
        repurchase or offer to repay, repurchase or otherwise acquire more than a
        de
        minimis number of shares of its securities or debt obligations, other than
        as
        permitted or required under the Transaction Documents;

      

      v.           pay
        cash dividends on any equity securities of the Company;

      

      vi.           enter
        into any transaction with any Affiliate of the Guarantor which would be required
        to be disclosed in any public filing of the Company with the Commission,
        unless
        such transaction is made on an arm’s-length basis and expressly approved by a
        majority of the disinterested directors of the Company (even if less than
        a
        quorum otherwise required for board approval); or

      

      vii.           enter
        into any agreement with respect to any of the foregoing.

      

      5.           Miscellaneous.

      

      (a)           Amendments
        in
        Writing. None of the terms or provisions of this Guarantee may be waived,
        amended, supplemented or otherwise modified except in writing by the
        Purchasers.

      

      (b)           Notices.
        All notices,
        requests and demands to or upon the Purchasers or any Guarantor hereunder
        shall
        be effected in the manner provided for in the Purchase Agreement, provided
        that
        any such notice, request or demand to or upon any Guarantor shall be addressed
        to such Guarantor at its notice address set forth on Schedule
        5(b).

      

      (c)           No
        Waiver By Course Of
        Conduct; Cumulative Remedies. The Purchasers shall not by any act (except
        by a written instrument pursuant to Section 5(a)), delay, indulgence, omission
        or otherwise be deemed to have waived any right or remedy hereunder or to
        have
        acquiesced in any default under the Transaction Documents or Event of Default.
        No failure to exercise, nor any delay in exercising, on the part of the
        Purchasers, any right, power or privilege hereunder shall operate as a waiver
        thereof. No single or partial exercise of any right, power or privilege
        hereunder shall preclude any other or further exercise thereof or the exercise
        of any other right, power or privilege. A waiver by the Purchasers of any
        right
        or remedy hereunder on any one occasion shall not be construed as a bar to
        any
        right or remedy which the Purchasers would otherwise have on any future
        occasion. The rights and remedies herein provided are cumulative, may be
        exercised singly or concurrently and are not exclusive of any other rights
        or
        remedies provided by law.

      
        
          
          

        

        
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      (d)           Enforcement
        Expenses;
        Indemnification.

      

      
        	
                 

              	
                (i)

              	
                Each
                  Guarantor agrees to pay, or reimburse the Purchasers for, all its
                  costs
                  and expenses incurred in collecting against such Guarantor under
                  the
                  guarantee contained in Section 2 or otherwise enforcing or preserving
                  any
                  rights under this Guarantee and the other Transaction Documents
                  to which
                  such Guarantor is a party, including, without limitation, the reasonable
                  fees and disbursements of counsel to the
                  Purchasers.

              

      

      

      
        	
                 

              	
                (ii)

              	
                Each
                  Guarantor agrees to pay, and to save the Purchasers harmless from,
                  any and
                  all liabilities with respect to, or resulting from any delay in
                  paying,
                  any and all stamp, excise, sales or other taxes which may be payable
                  or
                  determined to be payable in connection with any of the transactions
                  contemplated by this Guarantee.

              

      

      

      
        	
                 

              	
                (iii)

              	
                Each
                  Guarantor agrees to pay, and to save the Purchasers harmless from,
                  any and
                  all liabilities, obligations, losses, damages, penalties, actions,
                  judgments, suits, costs, expenses or disbursements of any kind
                  or nature
                  whatsoever with respect to the execution, delivery, enforcement,
                  performance and administration of this Guarantee to the extent
                  the Company
                  would be required to do so pursuant to the Purchase
                  Agreement.

              

      

      

      
        	
                 

              	
                (iv)

              	
                The
                  agreements in this Section shall survive repayment of the Obligations
                  and
                  all other amounts payable under the Purchase Agreement and the
                  other
                  Transaction Documents.

              

      

      

      (e)           Successor
        and
        Assigns. This Guarantee shall be binding upon the successors and assigns
        of each Guarantor and shall inure to the benefit of the Purchasers and their
        respective successors and assigns; provided that no Guarantor may assign,
        transfer or delegate any of its rights or obligations under this Guarantee
        without the prior written consent of the Purchasers.

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      (f)           Set-Off.
        Each
        Guarantor hereby irrevocably authorizes the Purchasers at any time and from
        time
        to time while an Event of Default under any of the Transaction Documents
        shall
        have occurred and be continuing, without notice to such Guarantor or any
        other
        Guarantor, any such notice being expressly waived by each Guarantor, to set-off
        and appropriate and apply any and all deposits, credits, indebtedness or
        claims,
        in any currency, in each case whether direct or indirect, absolute or
        contingent, matured or unmatured, at any time held or owing by the Purchasers
        to
        or for the credit or the account of such Guarantor, or any part thereof in
        such
        amounts as the Purchasers may elect, against and on account of the obligations
        and liabilities of such Guarantor to the Purchasers hereunder and claims
        of
        every nature and description of the Purchasers against such Guarantor, in
        any
        currency, whether arising hereunder, under the Purchase Agreement, any other
        Transaction Document or otherwise, as the Purchasers may elect, whether or
        not
        the Purchasers have made any demand for payment and although such obligations,
        liabilities and claims may be contingent or unmatured. The Purchasers shall
        notify such Guarantor promptly of any such set-off and the application made
        by
        the Purchasers of the proceeds thereof, provided that the failure to give
        such
        notice shall not affect the validity of such set-off and application. The
        rights
        of the Purchasers under this Section are in addition to other rights and
        remedies(including, without limitation, other rights of set-off) which the
        Purchasers may have.

      

      (g)           Counterparts.
        This
        Guarantee may be executed by one or more of the parties to this Guarantee
        on any
        number of separate counterparts (including by telecopy), and all of said
        counterparts taken together shall be deemed to constitute one and the same
        instrument.

      

      (h)           Severability.
        Any
        provision of this Guarantee which is prohibited or unenforceable in any
        jurisdiction shall, as to such jurisdiction, be ineffective to the extent
        of
        such prohibition or unenforceability without invalidating the remaining
        provisions hereof, and any such prohibition or unenforceability in any
        jurisdiction shall not invalidate or render unenforceable such provision
        in any
        other jurisdiction.

      

      (i)           Section
        Headings. The
        Section headings used in this Guarantee are for convenience of reference
        only
        and are not to affect the construction hereof or be taken into consideration
        in
        the interpretation hereof.

      

      (j)           Integration.
        This
        Guarantee and the other Transaction Documents represent the agreement of
        the
        Guarantors and the Purchasers with respect to the subject matter hereof and
        thereof, and there are no promises, undertakings, representations or warranties
        by the Purchasers relative to subject matter hereof and thereof not expressly
        set forth or referred to herein or in the other Transaction
        Documents.

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      (k)           Governing
        Law. THIS
        GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
        WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY PRINCIPLES OF
        CONFLICTS OF LAWS.

      

      (l)           Submission
        to
        Jurisdictional; Waiver. Each Guarantor hereby irrevocably
        and unconditionally:

      

      
        	
                 

              	
                (i)

              	
                submits
                  for itself and its property in any legal action or proceeding relating
                  to
                  this Guarantee and the other Transaction Documents to which it
                  is a party,
                  or for recognition and enforcement of any judgment in respect thereof,
                  to
                  the non-exclusive general jurisdiction of the Courts of the State
                  of New
                  York, located in New York County, New York, the courts of the United
                  States of America for the Southern District of New York, and appellate
                  courts from any thereof;

              

      

      

      
        	
                 

              	
                (ii)

              	
                consents
                  that any such action or proceeding may be brought in such courts
                  and
                  waives any objection that it may now or hereafter have to the venue
                  of any
                  such action or proceeding in any such court or that such action
                  or
                  proceeding was brought in an inconvenient court and agrees not
                  to plead or
                  claim the same;

              

      

      

      
        	
                 

              	
                (iii)

              	
                agrees
                  that service of process in any such action or proceeding may be
                  effected
                  by mailing a copy thereof by registered or certified mail (or any
                  substantially similar form of mail), postage prepaid, to such Guarantor
                  at
                  its address referred to in the Purchase Agreement or at such other
                  address
                  of which the Purchasers shall have been notified pursuant
                  thereto;

              

      

      

      
        	
                 

              	
                (iv)

              	
                agrees
                  that nothing herein shall affect the right to effect service of
                  process in
                  any other manner permitted by law or shall limit the right to sue in any
                  other jurisdiction; and

              

      

      

      
        	
                 

              	
                (v)

              	
                waives,
                  to the maximum extent not prohibited by law, any right it may have
                  to
                  claim or recover in any legal action or proceeding referred to
                  in this
                  Section any special, exemplary, punitive or consequential
                  damages.

              

      

      

      (m)           Acknowledgements.  Each
        Guarantor hereby acknowledges that:

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      
        	
                 

              	
                (i)

              	
                it
                  has been advised by counsel in the negotiation, execution and delivery
                  of
                  this Guarantee and the other Transaction Documents to which it
                  is a
                  party;

              

      

      

      
        	
                 

              	
                (ii)

              	
                the
                  Purchasers have no fiduciary relationship with or duty to any Guarantor
                  arising out of or in connection with this Guarantee or any of the
                  other
                  Transaction Documents, and the relationship between the Guarantors,
                  on the
                  one hand, and the Purchasers, on the other hand, in connection
                  herewith or
                  therewith is solely that of debtor and creditor;
                  and

              

      

      

      
        	
                 

              	
                (iii)

              	
                no
                  joint venture is created hereby or by the other Transaction Documents
                  or
                  otherwise exists by virtue of the transactions contemplated hereby
                  among
                  the Guarantors and the Purchasers.

              

      

      

      (n)           Additional
        Guarantors.  The Company shall cause each of its subsidiaries
        formed or acquired on or subsequent to the date hereof to become a Guarantor
        for
        all purposes of this Guarantee by executing and delivering an

      Assumption
        Agreement in the form of Annex 1 hereto.

      

      (o)           Release
        of
        Guarantors. Subject to Section 2.6, each Guarantor will be released from
        all liability hereunder concurrently with the repayment in full of all amounts
        owed under the Purchase Agreement, the Debentures and the other Transaction
        Documents.

      

      (p)           Seniority.
        The
        Obligations of each of the Guarantors hereunder rank senior in priority to
        any
        other Indebtedness (as defined in the Purchase Agreement) of such
        Guarantor.

      

      (q)           Waiver
        of Jury Trial.
        EACH GUARANTOR AND, BY ACCEPTANCE OF THE BENEFITS HEREOF, THE PURCHASERS,
        HEREBY
        IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
        PROCEEDING RELATING TO THIS GUARANTEE AND FOR ANY COUNTERCLAIM
        THEREIN.

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      

      IN
        WITNESS WHEREOF, each of the undersigned has caused this Guarantee to
        be
        duly executed and delivered as of the date first above written.

      

      
        	 	
                [SUBSIDIARY]  

              	 
	 	 	 	 	 
	 	
                By:

              	 	 	 
	 	 	
                Name:

              	 	 
	 	 	
                Title:

              	 	 

      

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      SCHEDULE
        1

      

      GUARANTORS

      

      The
        following are the names, notice addresses and jurisdiction of organization
        of
        each Guarantor.

      

      
        	
                COMPANY

              	 	
                JURISDICTION
                  OF INCORPORATION

              	 	
                OWNED
                  BY PERCENTAGE

              
	 	 	 	 	 
	
                OVT,
                  Inc.

              	 	
                Georgia

              	 	
                100%

              

      

      

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      Annex
        1
        to

      SUBSIDIARY
        GUARANTEE

      

      ASSUMPTION
        AGREEMENT, dated as of ____ __, ______ made by ______________________________,
        a
        ______________ corporation (the “Additional
        Guarantor”), in favor of the Purchasers pursuant to the Purchase
        Agreement referred to below. All capitalized terms not defined herein shall
        have
        the meaning ascribed to them in such Purchase Agreement.

      

      W
        I T N E S S E T H
        :

      

      WHEREAS,
        uVuMobile, Inc., a Delaware corporation (the “Company”) and the
        Purchasers have entered into a Securities Purchase Agreement, dated as of
        December ___, 2007 (as amended, supplemented or otherwise modified from time
        to
        time, the “Purchase
        Agreement”);

      

      WHEREAS,
        in connection with the Purchase Agreement, the Company and its Subsidiaries
        (other than the Additional Guarantor) have entered into the Subsidiary
        Guarantee, dated as of December ____, 2007 (as amended, supplemented or
        otherwise modified from time to time, the “Guarantee”) in favor
        of the Purchasers;

      

      WHEREAS,
        the Purchase Agreement requires the Additional Guarantor to become a party
        to
        the Guarantee; and

      

      WHEREAS,
        the Additional Guarantor has agreed to execute and deliver
        this Assumption Agreement in order to become a party to the
        Guarantee;

      

      NOW,
        THEREFORE, IT IS
        AGREED:

      

      1.           Guarantee.
        By
        executing and delivering this Assumption Agreement, the Additional Guarantor,
        as
        provided in Section 5(n) of the Guarantee, hereby becomes a party to the
        Guarantee as a Guarantor thereunder with the same force and effect as if
        originally named therein as a Guarantor and, without limiting the generality
        of
        the foregoing, hereby expressly assumes all obligations and liabilities of
        a
        Guarantor thereunder. The information set forth in Annex 1-A hereto is hereby
        added to the information set forth in Schedule 1 to the Guarantee. The
        Additional Guarantor hereby represents and warrants that each of the
        representations and warranties contained in Section 3 of the Guarantee is
        true
        and correct on and as the date hereof as to such Additional Guarantor (after
        giving effect to this Assumption Agreement) as if made on and as of such
        date.

      

      2.           Governing
        Law. THIS
        ASSUMPTION AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
        IN
        ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the undersigned has caused this Assumption Agreement
        to be duly executed and delivered as of the date first above
        written.

      

      
        	 	
                [ADDITIONALGUARANTOR] 

              	 	 
	 	 	 	 	 
	 	
                By:

              	 	 	 
	 	
                Name: 

              	 	 
	 	
                Title: 

              	 	 

      

    

     

     

    16ex10_1.htm

    
      

    

    Exhibit
      10.1

    

    SECURITIES
      PURCHASE AGREEMENT

    

    SECURITIES
      PURCHASE AGREEMENT
      (the "Agreement"), dated
      as of December 20, 2007, by and among EnterConnect Inc., a Nevada corporation,
      with headquarters located at 100 Century Center Court, Suite 650, San Jose,
      California 95112-4537 (the "Company"), and the investors
      listed on the Schedule of Buyers attached hereto (individually, a "Buyer" and collectively,
      the
      "Buyers").

    

    WHEREAS:

    

    A.           The
      Company and each Buyer is executing and delivering this Agreement in reliance
      upon the exemption from securities registration afforded by Section 4(2) of
      the
      Securities Act of 1933, as amended (the "1933 Act"), and Rule 506 of
      Regulation D ("Regulation
      D") as promulgated by the United States Securities and Exchange
      Commission (the "SEC")
      under the 1933 Act.

    

    B.           The
      Company has authorized a new series of senior convertible notes of the Company,
      in the form attached hereto as Exhibit A (the "Notes"),
      which Notes shall be
      convertible into the Company's common stock, par value $0.001 per share (the
      "Common Stock") (as
      converted, the "Conversion
      Shares"), in accordance with the terms of the Notes.

    

    C.           Each
      Buyer wishes to purchase, and the Company wishes to sell, upon the terms and
      conditions stated in this Agreement, (i) that aggregate principal amount of
      the
      Notes set forth opposite such Buyer's name in column (3) on the Schedule of
      Buyers attached hereto (which aggregate amount for all Buyers shall be
      $4,823,000 and (ii) warrants, in substantially the form attached hereto as
Exhibit B (the "Warrants"),
      to acquire up to
      that number of additional shares of Common Stock set forth opposite such Buyer's
      name in column (4) of the Schedule of Buyers (as exercised, collectively, the
      "Warrant
      Shares").

    

    D.           Contemporaneously
      with the execution and delivery of this Agreement, the parties hereto are
      executing and delivering a Registration Rights Agreement, substantially in
      the
      form attached hereto as Exhibit C (the "Registration
      Rights
      Agreement"), pursuant to which the Company will agree to provide certain
      registration rights with respect to the Registrable Securities (as defined
      in
      the Registration Rights Agreement) under the 1933 Act and the rules and
      regulations promulgated thereunder, and applicable state securities
      laws.

    

    E.           The
      Notes, the Conversion Shares, the Warrants and the Warrant Shares collectively
      are referred to herein as the "Securities".

    

    F.           The
      Notes will rank senior to all outstanding and future indebtedness of the Company
      and will be secured by a perfected security interest, in all of the assets
      of
      the Company, as evidenced by (i) a pledge and security agreement, in the form
      attached hereto as Exhibit H (as amended
      or modified from time to time in accordance with its terms, the "Pledge and Security
      Agreement", and, together with any ancillary documents related thereto,
      collectively the "Security
      Documents").

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    G.           The
      Buyers desire to appoint The Bank of New York as collateral agent with respect
      to the Collateral (as defined in the Security Agreement) (in such capacity,
      the
      "Collateral Agent")
      pursuant to a Collateral Agency Agreement, in the form attached hereto as Exhibit I (as amended
      or modified from time to time in accordance with its terms, the "Collateral Agency
      Agreement").

    

    NOW,
      THEREFORE, the Company
      and each Buyer hereby agree as follows:

    

    1.        
          PURCHASE AND SALE
      OF NOTES
      AND WARRANTS.

    

    (a)           Purchase
      of Notes and
      Warrants.

    

    (i)         
         Notes and
      Warrants. Subject to
      the
      satisfaction (or waiver) of the conditions set forth in Sections 6 and 7 below,
      the Company shall issue and sell to each Buyer, and each Buyer severally, but
      not jointly, shall purchase from the Company on the Closing Date (as defined
      below), (x) a principal amount of Notes as is set forth opposite such Buyer's
      name in column (3) on the Schedule of Buyers and (y) Warrants to acquire up
      to
      that number of Warrant Shares as is set forth opposite such Buyer's name in
      column (4) on the Schedule of Buyers, (the "Closing").

    

    (ii)      
           Closing.  The
      date and time of the Closing (the "Closing Date") shall be 10:00
      a.m., New York City time, on the date hereof (or such later date as is mutually
      agreed to by the Company and each Buyer) after notification of satisfaction
      (or
      waiver) of the conditions to the Closing set forth in Sections 6 and 7 below
      at
      the offices of Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New
      York 10022.

    

    (iii)           Purchase
      Price.

    

    (1)           The
      aggregate purchase price for the Notes and the Warrants to be purchased by
      each
      such Buyer at the Closing (the "Purchase Price") shall be the
      amount set forth opposite each Buyer's name in column (5) of the Schedule of
      Buyers.  Each Buyer shall pay $1,000 for each $1,000 of principal
      amount of Notes and related Warrants to be purchased by such Buyer at the
      Closing.

    

    (2)             The
      Buyers and the Company agree that the Notes and the Warrants constitute an
      "investment unit" for purposes of Section 1273(c)(2) of the Internal Revenue
      Code of 1986, as amended (the "Code").  The Buyers
      and the Company mutually agree that the allocation of the issue price of such
      investment unit between the Notes and the Warrants in accordance with Section
      1273(c)(2) of the Code and Treasury Regulation Section 1.1273-2(h) shall be
      an
      aggregate amount of $10,000 allocated to the Warrants and the balance of the
      Purchase Price allocated to the Notes, and neither the Buyers nor the Company
      shall take any position inconsistent with such allocation in any tax return
      or
      in any judicial or administrative proceeding in respect of taxes.

    

    (b)           Form
      of
      Payment.  On the Closing Date, (i) each Buyer shall pay its
      Purchase Price (less, in the case of Highbridge International LLC, the amounts
      withheld pursuant to Section 4(g)) to the Company for the Notes and the Warrants
      to be issued and sold to such Buyer at the Closing, by wire transfer of
      immediately available funds in accordance with the Company's written wire
      instructions or by surrender of such Buyer's Existing Debentures (as defined
      in
      the Exchange Agreement) as contemplated by that certain Exchange Agreement
      by
      and among the company and certain of the Buyers, dated as of even date herewith,
      (the "Exchange
      Agreement") and (ii) the Company shall deliver to each Buyer the Notes
      (allocated in the principal amounts as such Buyer shall request) which such
      Buyer is then purchasing hereunder along with the Warrants (allocated in the
      amounts as such Buyer shall request) which such Buyer is purchasing, in each
      case duly executed on behalf of the Company and registered in the name of such
      Buyer or its designee.

    
      
        
        

      

      
        -
          2
          -

        
          

        

      

      
        
        

      

    

    2.          
        BUYER'S
      REPRESENTATIONS AND WARRANTIES.  Each Buyer, severally and not
      jointly, represents and warrants with respect to only itself that, as of the
      date hereof and as of the Closing Date:

    

    (a)           No
      Sale or
      Distribution.  Such Buyer is acquiring the Notes, and the
      Warrants, and upon conversion of the Notes and exercise of the Warrants (other
      than pursuant to a Cashless Exercise (as defined in the Warrants)) will acquire
      the Conversion Shares issuable upon conversion of the Notes and the Warrant
      Shares issuable upon exercise of the Warrants, for its own account and not
      with
      a view towards, or for resale in connection with, the public sale or
      distribution thereof, except pursuant to sales registered or exempted under
      the
      1933 Act; provided, however, that by making the representations herein, such
      Buyer does not agree to hold any of the Securities for any minimum or other
      specific term and reserves the right to dispose of the Securities at any time
      in
      accordance with or pursuant to a registration statement or an exemption under
      the 1933 Act and pursuant to the applicable terms of the Transaction Documents
      (as defined in Section 3(b)).  Such Buyer is acquiring the Securities
      hereunder in the ordinary course of its business.  Such Buyer does not
      presently have any agreement or understanding, directly or indirectly, with
      any
      Person to distribute any of the Securities.

    

    (b)           Accredited
      Investor
      Status.  Such Buyer is an "accredited investor" as that term is
      defined in Rule 501(a) of Regulation D.

    

    (c)           Reliance
      on
      Exemptions.  Such Buyer understands that the Securities are
      being offered and sold to it in reliance on specific exemptions from the
      registration requirements of United States federal and state securities laws
      and
      that the Company is relying in part upon the truth and accuracy of, and such
      Buyer's compliance with, the representations, warranties, agreements,
      acknowledgments and understandings of such Buyer set forth herein in order
      to
      determine the availability of such exemptions and the eligibility of such Buyer
      to acquire the Securities.

    

    (d)           Information.  Such
      Buyer and its advisors, if any, have been furnished with all materials relating
      to the business, finances and operations of the Company and materials relating
      to the offer and sale of the Securities that have been requested by such
      Buyer.  Such Buyer and its advisors, if any, have been afforded the
      opportunity to ask questions of the Company.  Neither such inquiries
      nor any other due diligence investigations conducted by such Buyer or its
      advisors, if any, or its representatives shall modify, amend or affect such
      Buyer's right to rely on the Company's representations and warranties contained
      herein.  Such Buyer understands that its investment in the Securities
      involves a high degree of risk and is able to afford a complete loss of such
      investment.  Such Buyer has sought such accounting, legal and tax
      advice as it has considered necessary to make an informed investment decision
      with respect to its acquisition of the Securities.

    
      
        
        

      

      
        -
          3
          -

        
          

        

      

      
        
        

      

    

    (e)           No
      Governmental
      Review.  Such Buyer understands that no United States federal
      or state agency or any other government or governmental agency has passed on
      or
      made any recommendation or endorsement of the Securities or the fairness or
      suitability of the investment in the Securities nor have such authorities passed
      upon or endorsed the merits of the offering of the Securities.

    

    (f)           Transfer
      or
      Resale.  Such Buyer understands that except as provided in the
      Registration Rights Agreement: (i) the Securities have not been and are not
      being registered under the 1933 Act or any state securities laws, and may not
      be
      offered for sale, sold, assigned or transferred unless (A) subsequently
      registered thereunder, (B) such Buyer shall have delivered to the Company an
      opinion of counsel, in a generally acceptable form, to the effect that such
      Securities to be sold, assigned or transferred may be sold, assigned or
      transferred pursuant to an exemption from such registration, or (C) such Buyer
      provides the Company with reasonable assurance that such Securities can be
      sold,
      assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under
      the
      1933 Act, as amended (or a successor rule thereto) (collectively, "Rule 144"); (ii) any sale
      of
      the Securities made in reliance on Rule 144 may be made only in accordance
      with
      the terms of Rule 144 and further, if Rule 144 is not applicable, any resale
      of
      the Securities under circumstances in which the seller (or the Person (as
      defined in Section 3(s)) through whom the sale is made) may be deemed to be
      an
      underwriter (as that term is defined in the 1933 Act) may require compliance
      with some other exemption under the 1933 Act or the rules and regulations of
      the
      SEC thereunder; and (iii) neither the Company nor any other Person is under
      any
      obligation to register the Securities under the 1933 Act or any state securities
      laws or to comply with the terms and conditions of any exemption
      thereunder.  The Securities may be pledged in connection with a bona
      fide margin account or other loan or financing arrangement secured by the
      Securities and such pledge of Securities shall not be deemed to be a transfer,
      sale or assignment of the Securities hereunder, and no Buyer effecting a pledge
      of Securities shall be required to provide the Company with any notice thereof
      or otherwise make any delivery to the Company pursuant to this Agreement or
      any
      other Transaction Document (as defined in Section 3(b)), including, without
      limitation, this Section 2(f).

    

    (g)           Legends.  Such
      Buyer understands that the certificates or other instruments representing the
      Notes and the Warrants and, until such time as the resale of the Conversion
      Shares and the Warrant Shares have been registered under the 1933 Act as
      contemplated by the Registration Rights Agreement, the stock certificates
      representing the Conversion Shares and the Warrant Shares, except as set forth
      below, shall bear any legend as required by the "blue sky" laws of any state
      and
      a restrictive legend in substantially the following form (and a stop-transfer
      order may be placed against transfer of such stock certificates):

    

    
      	
              [NEITHER
                THE ISSUANCE
                AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE
                SECURITIES INTO WHICH THESE SECURITIES ARE [CONVERTIBLE][EXERCISABLE]
                HAVE BEEN][THE SECURITIES
                REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED
                UNDER THE
                SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
                LAWS.  THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
                TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE
                REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT
                OF
                1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE
                FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS
                SOLD
                PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
                ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE
                PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
                OR
                FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

            	 

    

    
      
        
        

      

      
        -
          4
          -

        
          

        

      

      
        
        

      

    

    The
      legend set forth above shall be removed and the Company shall issue a
      certificate without such legend to the holder of the Securities upon which
      it is
      stamped, if, unless otherwise required by state securities laws, (i) such
      Securities are registered for resale under the 1933 Act, (ii) in connection
      with
      a sale, assignment or other transfer, such holder provides the Company with
      an
      opinion of a law firm reasonably acceptable to the Company (with Schulte Roth
      & Zabel LLP being deemed acceptable), in a generally acceptable form, to the
      effect that such sale, assignment or transfer of the Securities may be made
      without registration under the applicable requirements of the 1933 Act, or
      (iii)
      such holder provides the Company with reasonable assurance that the Securities
      can be sold, assigned or transferred pursuant to Rule 144 or Rule
      144A.

    

    (h)           Validity;
      Enforcement.  This Agreement and the Registration Rights
      Agreement to which such Buyer is a party have been duly and validly authorized,
      executed and delivered on behalf of such Buyer and shall constitute the legal,
      valid and binding obligations of such Buyer enforceable against such Buyer
      in
      accordance with their respective terms, except as such enforceability may be
      limited by general principles of equity or to applicable bankruptcy, insolvency,
      reorganization, moratorium, liquidation and other similar laws relating to,
      or
      affecting generally, the enforcement of applicable creditors' rights and
      remedies.

    

    (i)           No
      Conflicts.  The execution, delivery and performance by such
      Buyer of this Agreement and the Registration Rights Agreement and the
      consummation by such Buyer of the transactions contemplated hereby and thereby
      will not (i) result in a violation of the organizational documents of such
      Buyer
      or (ii) conflict with, or constitute a default (or an event which with notice
      or
      lapse of time or both would become a default) under, or give to others any
      rights of termination, amendment, acceleration or cancellation of, any
      agreement, indenture or instrument to which such Buyer is a party, or (iii)
      result in a violation of any law, rule, regulation, order,
      judgment  or decree (including federal and state securities laws)
      applicable to such Buyer, except in the case of clauses (ii) and (iii) above,
      for such conflicts, defaults, rights or violations which would not, individually
      or in the aggregate, reasonably be expected to have a material adverse effect
      on
      the ability of such Buyer to perform its obligations hereunder.

    

    (j)           Residency.  Such
      Buyer is a resident of that jurisdiction specified below its address on the
      Schedule of Buyers.

    
      
        
        

      

      
        -
          5
          -

        
          

        

      

      
        
        

      

    

    (k)           Certain
      Trading
      Activities.  Other than with respect to the transactions
      contemplated herein, since the time that such Buyer was first contacted by
      the
      Company, the Agent (as defined below) or any other Person regarding this
      investment in the Company neither the Buyer nor any Affiliate of such Buyer
      which (x) had knowledge of the transactions contemplated hereby, (y) has or
      shares discretion relating to such Buyer's investments or trading or information
      concerning such Buyer's investments and (z) is subject to such Buyer's review
      or
      input concerning such Affiliate's investments or trading (collectively, "Trading Affiliates") has
      directly or indirectly, nor has any Person acting on behalf of or pursuant
      to
      any understanding with such Buyer or Trading Affiliate, effected or agreed
      to
      effect any transactions in the securities of the Company.  Such Buyer
      hereby covenants and agrees not to, and shall cause its Trading Affiliates
      not
      to, engage, directly or indirectly, in any transactions in the securities of
      the
      Company or involving the Company's securities during the period from the date
      hereof until such time as (i) the transactions contemplated by this Agreement
      are first publicly announced as described in Section 4(i) hereof or (ii) this
      Agreement is terminated in full pursuant to Section 8
      hereof.  Notwithstanding the foregoing, for avoidance of doubt,
      nothing contained herein shall constitute a representation or warranty, or
      preclude any actions, with respect to the identification of the availability
      of,
      or securing of, available shares to borrow in order to effect short sales or
      similar transactions in the future.

    

    3.       
           REPRESENTATIONS
      AND
      WARRANTIES OF THE COMPANY.  The Company represents and warrants
      to each of the Buyers that, as of the date hereof and as of the Closing
      Date:

    

    (a)           Organization
      and
      Qualification.  The Company and its "Subsidiaries" (which for
      purposes of this Agreement means any joint venture or any entity in which the
      Company, directly or indirectly, owns any of the capital stock or holds an
      equity or similar interest) are entities duly organized and validly existing
      and, to the extent legally applicable, in good standing under the laws of the
      jurisdiction in which they are formed, and have the requisite power and
      authorization to own their properties and to carry on their business as now
      being conducted.  Each of the Company and its Subsidiaries is duly
      qualified as a foreign entity to do business and to the extent legally
      applicable, is in good standing in every jurisdiction in which its ownership
      of
      property or the nature of the business conducted by it makes such qualification
      necessary, except to the extent that the failure to be so qualified or be in
      good standing would not reasonably be expected to have a Material Adverse
      Effect.  As used in this Agreement, "Material Adverse Effect" means
      any material adverse effect on the business, properties, assets, operations,
      results of operations, condition (financial or otherwise) or prospects of the
      Company and its Subsidiaries, individually or taken as a whole, or on the
      transactions contemplated hereby or in the other Transaction Documents or by
      the
      agreements and instruments to be entered into in connection herewith or
      therewith, or on the authority or ability of the Company to perform its
      obligations under the Transaction Documents (as defined below).  The
      Company has no Subsidiaries.

    

    (b)           Authorization;
      Enforcement;
      Validity.  The Company has the requisite corporate power and
      authority to enter into and perform its obligations under this Agreement, the
      Notes, the Registration Rights Agreement, the Security Documents, the
      Irrevocable Transfer Agent Instructions (as defined in Section 5(b)), the
      Warrants and each of the other agreements entered into by the parties hereto
      in
      connection with the transactions contemplated by this Agreement (collectively,
      the "Transaction
      Documents") and to issue the Securities in accordance with the terms
      hereof and thereof.  The execution and delivery of the Transaction
      Documents by the Company and the consummation by the Company of the transactions
      contemplated hereby and thereby, including, without limitation, the issuance
      of
      the Notes and the Warrants, the reservation for issuance and the issuance of
      the
      Conversion Shares issuable upon conversion
      of the Notes and the reservation for issuance and issuance of Warrant Shares
      issuable upon exercise of the Warrants have been duly authorized by the
      Company's Board of Directors and no further filing, consent, or authorization
      is
      required by the Company, its Board of Directors or its
      stockholders.  This Agreement and the other Transaction Documents of
      even date herewith have been duly executed and delivered by the Company, and
      constitute the legal, valid and binding obligations of the Company, enforceable
      against the Company in accordance with their respective terms, except as such
      enforceability may be limited by general principles of equity or applicable
      bankruptcy, insolvency, reorganization, moratorium, liquidation or similar
      laws
      relating to, or affecting generally, the enforcement of applicable creditors'
      rights and remedies.

    
      
        
        

      

      
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    (c)           Issuance
      of
      Securities.  The issuance of the Notes and the Warrants are
      duly authorized and upon issuance in accordance with the terms of the
      Transaction Documents shall be free from all taxes, liens and charges with
      respect to the issue thereof.  As of the Closing, a number of shares
      of Common Stock shall have been duly authorized and reserved for issuance which
      equals or exceeds 130% of the aggregate of the maximum number of shares of
      Common Stock issuable (i) upon conversion of the Notes, and (ii) upon exercise
      of the Warrants.  Upon conversion or exercise in accordance with the
      Notes or the Warrants, as the case may be, the Conversion Shares and the Warrant
      Shares, respectively, will be validly issued, fully paid and nonassessable
      and
      free from all preemptive or similar rights, taxes, liens and charges with
      respect to the issue thereof, with the holders being entitled to all rights
      accorded to a holder of Common Stock.  Assuming the accuracy of each
      of the representations and warranties set forth in Section 2 of this Agreement,
      the offer and issuance by the Company of the Securities is exempt from
      registration under the 1933 Act.

    

    (d)           No
      Conflicts.  The execution, delivery and performance of the
      Transaction Documents by the Company and the consummation by the Company of
      the
      transactions contemplated hereby and thereby (including, without limitation,
      the
      issuance of the Notes and Warrants and reservation for issuance and issuance
      of
      the Conversion Shares and the Warrant Shares) will not (i) result in a violation
      of any article of incorporation, certificate of formation, any certificate
      of
      designations or other constituent documents of the Company or any of its
      Subsidiaries, any capital stock of the Company or any of its Subsidiaries or
      bylaws of the Company or any of its Subsidiaries or (ii) conflict with, or
      constitute a default (or an event which with notice or lapse of time or both
      would become a default) in any respect under, or give to others any rights
      of
      termination, amendment, acceleration or cancellation of, any agreement,
      indenture or instrument to which the Company or any of its Subsidiaries is
      a
      party, or (iii) result in a violation of any law, rule, regulation, order,
      judgment or decree, including foreign, federal and state securities laws and
      regulations and the rules and regulations of The OTC Bulletin Board (the "Principal Market") applicable
      to the Company or any of its Subsidiaries or by which any property or asset
      of
      the Company or any of its Subsidiaries is bound or affected.

    
      
        
        

      

      
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          7
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    (e)           Consents.  Neither
      the Company nor any of its Subsidiaries is required to obtain any consent,
      authorization or order of, or make any filing or registration with, any court,
      governmental agency or any regulatory or self-regulatory agency or any other
      Person in order for it to execute, deliver or perform any of its obligations
      under or contemplated by the Transaction Documents, in each case in accordance
      with the terms hereof or thereof, except for the following consents,
      authorizations, orders, filings and registrations (none of which is required
      to
      be filed or obtained before the Closing): (i) the filing with the SEC of one
      or
      more Registration Statements in accordance with the requirements of the
      Registration Rights Agreement and (ii) the filing of a listing application
      for
      the Conversion Shares and Warrant Shares with the Principal Market, which shall
      be done pursuant to the rules of the Principal Market.  The Company
      and its Subsidiaries are unaware of any facts or circumstances that might
      prevent the Company from obtaining or effecting any of the registration,
      application or filings pursuant to the preceding sentence.  The
      Company is not in violation of the listing requirements of the Principal Market
      and has no knowledge of any facts that would reasonably lead to delisting or
      suspension of the Common Stock in the foreseeable future.  The
      issuance by the Company of the Securities shall not have the effect of delisting
      or suspending the Common Stock from the Principal Market.

    

    (f)           Acknowledgment
      Regarding
      Buyer's Purchase of Securities.  The Company acknowledges and
      agrees that each Buyer is acting solely in the capacity of an arm's length
      purchaser with respect to the Transaction Documents and the transactions
      contemplated hereby and thereby and that no Buyer is (i) an officer or director
      of the Company, (ii) an "affiliate" of the Company or any of its Subsidiaries
      (as defined in Rule 144) or (iii) to the knowledge of the Company, a "beneficial
      owner" of more than 10% of the shares of Common Stock (as defined for purposes
      of Rule 13d-3 of the Securities Exchange Act of 1934, as amended (the "1934 Act")).  The
      Company further acknowledges that no Buyer is acting as a financial advisor
      or
      fiduciary of the Company or any of its Subsidiaries (or in any similar capacity)
      with respect to the Transaction Documents and the transactions contemplated
      hereby and thereby, and any advice given by a Buyer or any of its
      representatives or agents in connection with the Transaction Documents and
      the
      transactions contemplated hereby and thereby is merely incidental to such
      Buyer's purchase of the Securities.  The Company further represents to
      each Buyer that the Company's decision to enter into the Transaction Documents
      has been based solely on the independent evaluation by the Company and its
      representatives.

    

    (g)           No
      General Solicitation;
      Placement Agent's Fees.  Neither the Company, nor any of its
      Subsidiaries or affiliates, nor any Person acting on its or their behalf, has
      engaged in any form of general solicitation or general advertising (within
      the
      meaning of Regulation D) in connection with the offer or sale of the
      Securities.  The Company shall be responsible for the payment of any
      placement agent's fees, financial advisory fees, or brokers' commissions (other
      than for persons engaged by any Buyer or its investment advisor) relating to
      or
      arising out of the transactions contemplated hereby, which fees are set forth
      on
Schedule
      3(g).  The Company acknowledges that it has engaged Worldwide
      Gateway Co., Ltd. as placement agent (collectively, the "Agent") in connection with
      the
      sale of the Securities.  Other than the Agent, neither the Company nor
      any of its Subsidiaries has engaged any placement agent or other agent in
      connection with the sale of the Securities.

    

    (h)           No
      Integrated
      Offering.  None of the Company, its Subsidiaries, any of their
      affiliates, and any Person acting on their behalf has, directly or indirectly,
      made any offers or sales of any security or solicited any offers to buy any
      security, under circumstances that would require registration of any of the
      Securities under the 1933 Act, or cause this offering of the Securities to
      be
      integrated with prior offerings by the Company for purposes of any applicable
      stockholder approval provisions, including, without limitation, under the rules
      and regulations of any exchange or automated quotation system on which any
      of
      the securities of the Company are listed or designated.  None of the
      Company, its Subsidiaries, their affiliates and any Person acting on their
      behalf will take any action or steps referred to in the preceding sentence
      that
      would require registration of any of the Securities under the 1933 Act or cause
      the offering of the Securities to be integrated with other
      offerings.

    
      
        
        

      

      
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    (i)           Dilutive
      Effect.  The Company understands and acknowledges that the
      number of Conversion Shares issuable upon conversion of the Notes and the
      Warrant Shares issuable upon exercise of the Warrants will increase in certain
      circumstances.  The Company further acknowledges that its obligation
      to issue Conversion Shares upon conversion of the Notes in accordance with
      this
      Agreement and the Notes and its obligation
      to
      issue the Warrant Shares upon exercise of the Warrants in accordance with this
      Agreement and the Warrants is, in each case, absolute and unconditional
      regardless of the dilutive effect that such issuance may have on the ownership
      interests of other stockholders of the Company.

    

    (j)           Application
      of Takeover
      Protections; Rights Agreement.  The Company and its board of
      directors have taken all necessary action, if any, in order to render
      inapplicable any control share acquisition, business combination, poison pill
      (including any distribution under a rights agreement) or other similar
      anti-takeover provision under the Articles of Incorporation (as defined in
      Section 3(r)) or the laws of the state of its incorporation which is or could
      become applicable to any Buyer as a result of the transactions contemplated
      by
      this Agreement, including, without limitation, the Company's issuance of the
      Securities and any Buyer's ownership of the Securities.  The Company
      and its board of directors have taken all necessary action, if any, in order
      to
      render inapplicable any stockholder rights plan or similar arrangement relating
      to accumulations of beneficial ownership of Common Stock or a change in control
      of the Company.

    

    (k)           SEC
      Documents; Financial
      Statements.  Since the effectiveness of the Company's
      Registration Statement on the Form SB-2, the Company has filed all reports,
      schedules, forms, statements and other documents required to be filed by it
      with
      the SEC pursuant to the reporting requirements of the 1934 Act (all of the
      foregoing filed prior to the date hereof and all exhibits included therein
      and
      financial statements, notes and schedules thereto and documents incorporated
      by
      reference therein being hereinafter referred to as the "SEC
      Documents").  The Company has delivered to the Buyers or their
      respective representatives true, correct and complete copies of the SEC
      Documents not available on the EDGAR system.  As of their respective
      filing dates, the SEC Documents complied in all material respects with the
      requirements of the 1934 Act and the rules and regulations of the SEC
      promulgated thereunder applicable to the SEC Documents, and none of the SEC
      Documents, at the time they were filed with the SEC, contained any untrue
      statement of a material fact or omitted to state a material fact required to
      be
      stated therein or necessary in order to make the statements therein, in the
      light of the circumstances under which they were made, not
      misleading.  As of their respective filing dates, the financial
      statements of the Company included in the SEC Documents complied as to form
      in
      all material respects with applicable accounting requirements and the published
      rules and regulations of the SEC with respect thereto.  Such financial
      statements have been prepared in accordance with generally accepted accounting
      principles, consistently applied, during the periods involved (except (i) as
      may
      be otherwise indicated in such financial statements or the notes thereto, or
      (ii) in the case of unaudited interim statements, to the extent they may exclude
      footnotes or may be condensed or summary statements) and fairly present in
      all
      material respects the financial position of the Company as of the dates thereof
      and the results of its operations and cash flows for the periods then ended
      (subject, in the case of unaudited statements, to normal year-end audit
      adjustments).  No other information provided by or on behalf of the
      Company to the Buyers which is not included in the SEC Documents, including,
      without limitation, information referred to in Section 2(d) of this Agreement
      or
      in any disclosure schedules, contains any untrue statement of a material fact
      or
      omits to state any material fact necessary in order to make the statements
      therein, in the light of the circumstance under which they are or were made
      not
      misleading.

    
      
        
        

      

      
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    (l)           Absence
      of Certain
      Changes.  Since December 31, 2006, there has been no material
      adverse change and no material adverse development in the business, properties,
      operations, condition (financial or otherwise), results of operations or
      prospects of the Company or its Subsidiaries.  Since December 31, 2006,
      the
      Company has not (i) declared or paid any dividends, (ii) sold any assets,
      individually or in the aggregate, in excess of $50,000 outside of the ordinary
      course of business or (iii) had capital expenditures, individually or in the
      aggregate, in excess of $250,000.  Neither the Company nor any of its
      Subsidiaries has taken any steps to seek protection pursuant to any bankruptcy
      law nor does the Company have any knowledge or reason to believe that its
      creditors intend to initiate involuntary bankruptcy proceedings or any actual
      knowledge of any fact that would reasonably lead a creditor to do
      so.  The Company and its Subsidiaries, individually and on a
      consolidated basis, are not as of the date hereof, and after giving effect
      to
      the transactions contemplated hereby to occur at the Closing, will not be
      Insolvent (as defined below).  For purposes of this Section 3(l),
      "Insolvent" means, with
      respect to any Person (as defined in Section 3(s)), (i) the present fair
      saleable value of such Person's assets is less than the amount required to
      pay
      such Person's total Indebtedness (as defined in Section 3(s)), (ii) such Person
      is unable to pay its debts and liabilities, subordinated, contingent or
      otherwise, as such debts and liabilities become absolute and matured, (iii)
      such
      Person intends to incur or believes that it will incur debts that would be
      beyond its ability to pay as such debts mature or (iv) such Person has
      unreasonably small capital with which to conduct the business in which it is
      engaged as such business is now conducted and is proposed to be
      conducted.

    

    (m)           No
      Undisclosed Events,
      Liabilities, Developments or Circumstances.  No event,
      liability, development or circumstance has occurred or exists, or is
      contemplated to occur with respect to the Company, its Subsidiaries or their
      respective business, properties, prospects, operations or financial condition,
      that would be required to be disclosed by the Company under applicable
      securities laws on a registration statement on Form S-1 filed with the SEC
      relating to an issuance and sale by the Company of its Common Stock and which
      has not been publicly announced.

    

    (n)           Conduct
      of Business;
      Regulatory Permits.  Neither the Company nor any of its
      Subsidiaries is in violation of any term of or in default under its Articles
      of
      Incorporation, any certificate of designations of any outstanding series of
      preferred stock of the Company or the Bylaws or their organizational charter
      or
      bylaws, respectively.  Neither the Company nor any of its Subsidiaries
      is in violation of any judgment, decree or order or any statute, ordinance,
      rule
      or regulation applicable to the Company or its Subsidiaries, and neither the
      Company nor any of its Subsidiaries will conduct its business in violation
      of
      any of the foregoing, except for possible violations which could not,
      individually or in the aggregate, reasonably be expected to have a Material
      Adverse Effect.  Without limiting the generality of the foregoing, the
      Company is not in violation of any of the rules, regulations or requirements
      of
      the Principal Market and has no knowledge of any facts or circumstances that
      would reasonably lead to delisting or suspension of the Common Stock by the
      Principal Market in the foreseeable future.  Since November 30, 2007
      (i) the Common Stock has been designated for quotation on the Principal Market,
      (ii) trading in the Common Stock has not been suspended by the SEC or the
      Principal Market and (iii) the Company has received no communication, written
      or
      oral, from the SEC or the Principal Market regarding the suspension or delisting
      of the Common Stock from the Principal Market.  The Company and its
      Subsidiaries possess all certificates, authorizations and permits issued by
      the
      appropriate regulatory authorities necessary to conduct their respective
      businesses, except where the failure to possess such certificates,
      authorizations or permits would not have, individually or in the aggregate,
      a
      Material Adverse Effect, and neither the Company nor any such Subsidiary has
      received any notice of proceedings relating to the revocation or modification
      of
      any such certificate, authorization or permit.

    
      
        
        

      

      
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    (o)           Foreign
      Corrupt
      Practices.  Neither the Company nor any of its Subsidiaries nor
      any director, officer, agent, employee or other Person acting on behalf of
      the
      Company or any of its Subsidiaries has, in the course of its actions for, or
      on
      behalf of, the Company or any of its Subsidiaries (i) used any corporate funds
      for any unlawful contribution, gift, entertainment or other unlawful expenses
      relating to political activity; (ii) made any direct or indirect unlawful
      payment to any foreign or domestic government official or employee from
      corporate funds; (iii) violated or is in violation of any provision of the
      U.S.
      Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful
      bribe, rebate, payoff, influence payment, kickback or other unlawful payment
      to
      any foreign or domestic government official or employee.

    

    (p)           Sarbanes-Oxley
      Act.  The Company is in compliance with any and all applicable
      requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the
      date
      hereof, and any and all applicable rules and regulations promulgated by the
      SEC
      thereunder that are effective as of the date hereof.

    

    (q)           Transactions
      With
      Affiliates.  Except as set forth in the SEC Documents filed at
      least ten (10) days prior to the date hereof and other than the grant of stock
      options, none of the officers, directors or employees of the Company or any
      of
      its Subsidiaries is presently a party to any transaction with the Company or
      any
      of its Subsidiaries (other than for ordinary course services as employees,
      officers or directors), including any contract, agreement or other arrangement
      providing for the furnishing of services to or by, providing for rental of
      real
      or personal property to or from, or otherwise requiring payments to or from
      any
      such officer, director or employee or, to the knowledge of the Company or any
      of
      its Subsidiaries, any corporation, partnership, trust or other entity in which
      any such officer, director, or employee has a substantial interest or is an
      officer, director, trustee or partner.

    
      
        
        

      

      
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    (r)           Equity
      Capitalization.  As of the date hereof, the authorized capital
      stock of the Company consists of  (i) 1,000,000 shares of Preferred
      Stock, $0.001 par value, of which as of the date hereof, none are issued and
      outstanding, (ii) 100,000,000 shares of Common Stock, of which as of the date
      hereof, 27,125,261 are issued and outstanding, 10,000,000 shares are reserved
      for issuance pursuant to the Company's stock option and purchase plans and
      4,571,225 shares are reserved for issuance pursuant to securities, which shares
      are set forth in Schedule 3(r), (other
      than the aforementioned options, the Notes and the Warrants) exercisable or
      exchangeable for, or convertible into, shares of Common Stock.  All of
      such outstanding shares have been, or upon issuance will be, validly issued
      and
      are fully paid and nonassessable.  Except as disclosed in Schedule 3(r): (i)
      none of the Company's capital stock is subject to preemptive rights or any
      other
      similar rights or any liens or encumbrances suffered or permitted by the
      Company; (ii) there are no outstanding options, warrants, scrip, rights to
      subscribe to, calls or commitments of any character whatsoever relating to,
      or
      securities or rights convertible into, or exercisable or exchangeable for,
      any
      capital stock of the Company or any of its Subsidiaries, or contracts,
      commitments, understandings or arrangements by which the Company or any of
      its
      Subsidiaries is or may become bound to issue additional capital stock of the
      Company or any of its Subsidiaries or options, warrants, scrip, rights to
      subscribe to, calls or commitments of any character whatsoever relating to,
      or
      securities or rights convertible into, or exercisable or exchangeable for,
      any
      capital stock of the Company or any of its Subsidiaries; (iii) there are no
      outstanding debt securities, notes, credit agreements, credit facilities or
      other agreements, documents or instruments evidencing Indebtedness of the
      Company or any of its Subsidiaries or by which the Company or any of its
      Subsidiaries is or may become bound; (iv) there are no financing statements
      securing obligations in any material amounts, either singly or in the aggregate,
      filed in connection with the Company or any of its Subsidiaries; (v) there
      are
      no agreements or arrangements under which the Company or any of its Subsidiaries
      is obligated to register the sale of any of their securities under the 1933
      Act
      (except pursuant to the Registration Rights Agreement); (vi) there are no
      outstanding securities or instruments of the Company or any of its Subsidiaries
      which contain any redemption or similar provisions, and there are no contracts,
      commitments, understandings or arrangements by which the Company or any of
      its
      Subsidiaries is or may become bound to redeem a security of the Company or
      any
      of its Subsidiaries; (vii) there are no securities or instruments containing
      anti-dilution or similar provisions that will be triggered by the issuance
      of
      the Securities; (viii) the Company does not have any stock appreciation rights
      or "phantom stock" plans or agreements or any similar plan or agreement; and
      (ix) the Company and its Subsidiaries have no liabilities or obligations
      required to be disclosed in the SEC Documents but not so disclosed in the SEC
      Documents, other than those incurred in the ordinary course of the Company's
      or
      its Subsidiaries' respective businesses and which, individually or in the
      aggregate, do not or would not have a Material Adverse Effect.  The
      Company has furnished to the Buyers true, correct and complete copies of the
      Company's Articles of Incorporation, as amended and as in effect on the date
      hereof (the "Articles of
      Incorporation"), and the Company's Bylaws, as amended and as in effect on
      the date hereof (the "Bylaws"), and the terms
      of all
      securities convertible into, or exercisable or exchangeable for, shares of
      Common Stock and the material rights of the holders thereof in respect
      thereto.

    

    (s)           Indebtedness
      and Other
      Contracts.  As of the date hereof, other than the Existing
      Debentures (as defined in the Exchange Agreement), and as of the Closing,
      neither the Company nor any of its Subsidiaries (i) has any outstanding
      Indebtedness (as defined below), (ii) is a party to any contract, agreement
      or
      instrument, the violation of which, or default under which, by the other
      party(ies) to such contract, agreement or instrument could reasonably be
      expected to result in a Material Adverse Effect, (iii) is in violation of any
      term of or in default under any contract, agreement or instrument relating
      to
      any Indebtedness, except where such violations and defaults would not result,
      individually or in the aggregate, in a Material Adverse Effect, or (iv) is
      a
      party to any contract, agreement or instrument relating to any Indebtedness,
      the
      performance of which, in the judgment of the Company's officers, has or is
      expected to have a Material Adverse Effect.  For purposes of this
      Agreement:  (x) "Indebtedness" of any Person
      means, without duplication (A) all indebtedness for borrowed money, (B) all
      obligations issued, undertaken or assumed as the deferred purchase price of
      property or services, including (without limitation) "capital leases" in
      accordance with generally accepted accounting principles (other than trade
      payables entered into in the ordinary course of business), (C) all reimbursement
      or payment obligations with respect to letters of credit, surety bonds and
      other
      similar instruments, (D) all obligations evidenced by notes, bonds, debentures
      or similar instruments, including obligations so evidenced incurred in
      connection with the acquisition of property, assets or businesses, (E) all
      indebtedness created or arising under any conditional sale or other title
      retention agreement, or incurred as financing, in either case with respect
      to
      any property or assets acquired with the proceeds of such indebtedness (even
      though the rights and remedies of the seller or bank under such agreement in
      the
      event of default are limited to repossession or sale of such property), (F)
      all
      monetary obligations under any leasing or similar arrangement which, in
      connection with generally accepted accounting principles, consistently applied
      for the periods covered thereby, is classified as a capital lease, (G) all
      indebtedness referred to in clauses (A) through (F) above secured by (or for
      which the holder of such Indebtedness has an existing right, contingent or
      otherwise, to be secured by) any mortgage, lien, pledge, charge, security
      interest or other encumbrance upon or in any property or assets (including
      accounts and contract rights) owned by any Person, even though the Person which
      owns such assets or property has not assumed or become liable for the payment
      of
      such indebtedness, and (H) all Contingent Obligations in respect of indebtedness
      or obligations of others of the kinds referred to in clauses (A) through (G)
      above; (y) "Contingent
      Obligation" means, as to any Person, any direct or indirect liability,
      contingent or otherwise, of that Person with respect to any indebtedness, lease,
      dividend or other obligation of another Person if the primary purpose or intent
      of the Person incurring such liability, or the primary effect thereof, is to
      provide assurance to the obligee of such liability that such liability will
      be
      paid or discharged, or that any agreements relating thereto will be complied
      with, or that the holders of such liability will be protected (in whole or
      in
      part) against loss with respect thereto; and (z) "Person" means an individual,
      a
      limited liability company, a partnership, a joint venture, a corporation, a
      trust, an unincorporated organization and a government or any department or
      agency thereof.

    
      
        
        

      

      
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    (t)           Absence
      of
      Litigation.  There is no action, suit, proceeding, inquiry or
      investigation before or by the Principal Market, any court, public board,
      government agency, self-regulatory organization or body pending or, to the
      knowledge of the Company, threatened against or affecting the Company or any
      of
      its Subsidiaries, the Common Stock or any of the Company's Subsidiaries or
      any
      of the Company's or its Subsidiaries' officers or directors.

    

    (u)           Insurance.  The
      Company and each of its Subsidiaries are insured by insurers of recognized
      financial responsibility against such losses and risks and in such amounts
      as
      management of the Company believes to be prudent and customary in the businesses
      in which the Company and its Subsidiaries are engaged.  Neither the
      Company nor any such Subsidiary has been refused any insurance coverage sought
      or applied for and neither the Company nor any such Subsidiary has any reason
      to
      believe that it will not be able to renew its existing insurance coverage as
      and
      when such coverage expires or to obtain similar coverage from similar insurers
      as may be necessary to continue its business at a cost that would not have
      a
      Material Adverse Effect.

    
      
        
        

      

      
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          13
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    (v)           Employee
      Relations.

    

    (i)      
           Neither the Company nor any of its Subsidiaries is
      a party to any collective bargaining agreement or employs any member of a
      union.  The Company and its Subsidiaries believe that their relations
      with their employees are good.  No executive officer of the
      Company  or any of its Subsidiaries (as defined in Rule 501(f) of the
      1933 Act) has notified the Company or any such Subsidiary that such officer
      intends to leave the Company or any such Subsidiary or otherwise terminate
      such
      officer's employment with the Company or any such Subsidiary.  No
      executive officer of the Company or any of its Subsidiaries, is, or is now
      expected to be, in violation of any material term of any employment contract,
      confidentiality, disclosure or proprietary information agreement,
      non-competition agreement, or any other contract or agreement or any restrictive
      covenant, and the continued employment of each such executive officer does
      not
      subject the Company or any of its Subsidiaries to any liability with respect
      to
      any of the foregoing matters.

    

    (ii)           The
      Company and its Subsidiaries are in compliance with all federal, state, local
      and foreign laws and regulations respecting labor, employment and employment
      practices and benefits, terms and conditions of employment and wages and hours,
      except where failure to be in compliance would not, either individually or
      in
      the aggregate, reasonably be expected to result in a Material Adverse
      Effect.

    

    (w)           Title.
      The Company
      and its Subsidiaries have good and marketable title in fee simple to all real
      property and good and marketable title to all personal property owned by them
      which is material to the business of the Company and its Subsidiaries, in each
      case free and clear of all liens, encumbrances and defects except such as do
      not
      materially affect the value of such property and do not interfere with the
      use
      made and proposed to be made of such property by the Company and any of its
      Subsidiaries.  Any real property and facilities held under lease by
      the Company or any of its Subsidiaries are held by them under valid, subsisting
      and enforceable leases with such exceptions as are not material and do not
      interfere with the use made and proposed to be made of such property and
      buildings by the Company and its Subsidiaries.

    

    (x)           Intellectual
      Property
      Rights.  The Company and its Subsidiaries own or possess
      adequate rights or licenses to use all trademarks, service marks and all
      applications and registrations therefor, trade names, patents, patent rights,
      copyrights, original works of authorship, inventions, trade secrets and other
      intellectual property rights ("Intellectual Property Rights")
      necessary to conduct their respective businesses as now
      conducted.  None of the Company's registered, or applied for,
      Intellectual Property Rights has expired or terminated or has been abandoned,
      or
      is expected to expire or terminate or expected to be abandoned, within three
      years from the date of this Agreement.  The Company does not have any
      knowledge of any infringement by the Company or its Subsidiaries of Intellectual
      Property Rights of others. There is no claim, action or proceeding being made
      or
      brought, or to the knowledge of the Company, being threatened, against the
      Company or its Subsidiaries regarding its Intellectual Property
      Rights.  Neither the Company nor any of its Subsidiaries is aware of
      any facts or circumstances which might give rise to any of the foregoing
      infringements or claims, actions or proceedings.  The Company and its
      Subsidiaries have taken reasonable security measures to protect the secrecy,
      confidentiality and value of all of their Intellectual Property
      Rights.

    
      
        
        

      

      
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          14
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    (y)           Environmental
      Laws.  The Company and its Subsidiaries (i) are in compliance
      with any and all Environmental Laws (as hereinafter defined), (ii) have received
      all permits, licenses or other approvals required of them under applicable
      Environmental Laws to conduct their respective businesses and (iii) are in
      compliance with all terms and conditions of any such permit, license or approval
      where, in each of the foregoing clauses (i), (ii) and (iii), the failure to
      so
      comply could be reasonably expected to have, individually or in the aggregate,
      a
      Material Adverse Effect.  The term "Environmental Laws" means all
      federal, state, local or foreign laws relating to pollution or protection of
      human health or the environment (including, without limitation, ambient air,
      surface water, groundwater, land surface or subsurface strata), including,
      without limitation, laws relating to emissions, discharges, releases or
      threatened releases of chemicals, pollutants, contaminants, or toxic or
      hazardous substances or wastes (collectively, "Hazardous Materials") into
      the environment, or
      otherwise relating to the manufacture, processing, distribution, use, treatment,
      storage, disposal, transport or handling of Hazardous Materials, as well as
      all
      authorizations, codes, decrees, demands or demand letters, injunctions,
      judgments, licenses, notices or notice letters, orders, permits, plans or
      regulations issued, entered, promulgated or approved thereunder.

    

    (z)           Subsidiary
      Rights.  The Company or one of its Subsidiaries has the
      unrestricted right to vote, and (subject to limitations imposed by applicable
      law) to receive dividends and distributions on, all capital securities of its
      Subsidiaries as owned by the Company or such Subsidiary.

    

    (aa)         Tax
      Status.  The Company and each of its Subsidiaries (i) has made
      or filed all foreign, federal and state income and all other tax returns,
      reports and declarations required by any jurisdiction to which it is subject,
      (ii) has paid all taxes and other governmental assessments and charges that
      are
      material in amount, shown or determined to be due on such returns, reports
      and
      declarations, except those being contested in good faith and (iii) has set
      aside
      on its books provision reasonably adequate for the payment of all taxes for
      periods subsequent to the periods to which such returns, reports or declarations
      apply.  There are no unpaid taxes in any material amount claimed to be
      due by the taxing authority of any jurisdiction, and the officers of the Company
      know of no basis for any such claim.

    

    (bb)         Internal
      Accounting and
      Disclosure Controls.  The Company and each of its Subsidiaries
      maintain a system of internal accounting controls sufficient to provide
      reasonable assurance that (i) transactions are executed in accordance with
      management's general or specific authorizations, (ii) transactions are recorded
      as necessary to permit preparation of financial statements in conformity with
      generally accepted accounting principles and to maintain asset and liability
      accountability, (iii) access to assets or incurrence of liabilities is permitted
      only in accordance with management's general or specific authorization and
      (iv)
      the recorded accountability for assets and liabilities is compared with the
      existing assets and liabilities at reasonable intervals and appropriate action
      is taken with respect to any difference.  The Company maintains
      disclosure controls and procedures (as such term is defined in Rule 13a-14
      under
      the 1934 Act) that are effective in ensuring that information required to be
      disclosed by the Company in the reports that it files or submits under the
      1934
      Act is recorded, processed, summarized and reported, within the time periods
      specified in the rules and forms of the SEC, including, without limitation,
      controls and procedures designed in to ensure that information required to
      be
      disclosed by the Company in the reports that it files or submits under the
      1934
      Act is accumulated and communicated to the Company's management, including
      its
      principal executive officer or officers and its principal financial officer
      or
      officers, as appropriate, to allow timely decisions regarding required
      disclosure.  During the twelve months prior to the date hereof neither
      the Company nor any of its Subsidiaries have received any notice or
      correspondence from any accountant relating to any potential material weakness
      in any part of the system of internal accounting controls of the Company or
      any
      of its Subsidiaries.

    
      
        
        

      

      
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          15
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    (cc)      
         Ranking of
      Notes.  No Indebtedness of the Company is senior to or ranks
pari passu with the
      Notes in right of payment, whether with respect of payment of redemptions,
      interest, damages or upon liquidation or dissolution or otherwise.

    

    (dd)         Off
      Balance Sheet
      Arrangements.  There is no transaction, arrangement, or other
      relationship between the Company and an unconsolidated or other off balance
      sheet entity that is required to be disclosed by the Company in its 1934 Act
      filings and is not so disclosed or that otherwise would be reasonably likely
      to
      have a Material Adverse Effect.

    

    (ee)      
         Investment Company
      Status.  The Company is not, and upon consummation of the sale
      of the Securities will not be, an "investment company," a company controlled
      by
      an "investment company" or an "affiliated person" of, or "promoter" or
      "principal underwriter" for, an "investment company" as such terms are defined
      in the Investment Company Act of  1940, as amended.

    

    (ff)     
           Form SB-2
      Eligibility.  The Company is eligible to register the
      Conversion Shares and the Warrant Shares for resale by the Buyers using Form
      SB-2 promulgated under the 1933 Act.

    

    (gg)      
        Transfer
      Taxes.  On the Closing Date, all stock transfer or other taxes
      (other than income or similar taxes) which are required to be paid in connection
      with the sale and transfer of the Securities to be sold to each Buyer hereunder
      will be, or will have been, fully paid or provided for by the Company, and
      all
      laws imposing such taxes will be or will have been complied with.

    

    (hh)         Manipulation
      of
      Price.  The Company has not, and to its knowledge no one acting
      on its behalf has, (i) taken, directly or indirectly, any action designed to
      cause or to result, or that could reasonably be expected to cause or result,
      in
      the stabilization or manipulation of the price of any security of the Company
      to
      facilitate the sale or resale of any of the Securities, (ii) other than the
      Agent, sold, bid for, purchased, or paid any compensation for soliciting
      purchases of, any of the Securities, or (iii) paid or agreed to pay to any
      person any compensation for soliciting another to purchase any other securities
      of the Company.

    
      
        
        

      

      
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    (ii)       
          U.S. Real Property
      Holding
      Corporation.  The Company is not, nor has it ever been, a U.S.
      real property holding corporation within the meaning of Section 897 of the
      Internal Revenue Code of 1986, as amended, and the Company shall so certify
      upon
      any Buyer's request.

    

    (jj)      
           Bank Holding Company
      Act.  Neither the Company nor any of its Subsidiaries is
      subject to the Bank Holding Company Act of 1956, as amended (the "BHCA") and to regulation
      by
      the Board of Governors of the Federal Reserve System (the "Federal
      Reserve").  Neither the Company nor any of its Subsidiaries or
      affiliates owns or controls, directly or indirectly, five percent (5%) or more
      of the outstanding shares of any class of voting securities or twenty-five
      (25%)
      or more of the total equity of a bank or any  equity that is subject
      to the BHCA and to regulation by the Federal Reserve.  Neither the
      Company nor any of its Subsidiaries or affiliates exercises a controlling
      influence over the management or policies of a bank or any entity that is
      subject to the BHCA and to regulation by the Federal Reserve.

    

    (kk)          Disclosure.  The
      Company confirms that neither it nor any other Person acting on its behalf
      has
      provided any of the Buyers or their agents or counsel with any information
      that
      constitutes or could reasonably be expected to constitute material, nonpublic
      information.  The Company understands and confirms that each of the
      Buyers will rely on the foregoing representations in effecting transactions
      in
      securities of the Company.  All disclosure provided to the Buyers
      regarding the Company or any of its Subsidiaries, their business and the
      transactions contemplated hereby, including the Schedules to this Agreement,
      furnished by or on behalf of the Company is true and correct and does not
      contain any untrue statement of a material fact or omit to state any material
      fact necessary in order to make the statements made therein, in the light of
      the
      circumstances under which they were made, not misleading.  Each press
      release issued by the Company or any of its Subsidiaries during the twelve
      (12)
      months preceding the date of this Agreement did not at the time of release
      contain any untrue statement of a material fact or omit to state a material
      fact
      required to be stated therein or necessary in order to make the statements
      therein, in the light of the circumstances under which they were made, not
      misleading.  No event or circumstance has occurred or information
      exists with respect to the Company or any of its Subsidiaries or its or their
      business, properties, prospects, operations or financial conditions, which,
      under applicable law, rule or regulation, requires public disclosure or
      announcement by the Company but which has not been so publicly announced or
      disclosed.

     

    (ll)        
         Acknowledgement
      Regarding
      Buyers' Trading Activity.  Anything in this Agreement or
      elsewhere herein to the contrary notwithstanding, but subject to compliance
      by
      the Buyers with applicable law and the provisions of Section 2(k) hereto, it
      is
      understood and acknowledged by the Company (i) that none of the Buyers have
      been
      asked by the Company or its Subsidiaries to agree, nor has any Buyer agreed
      with
      the Company or its Subsidiaries, to desist from purchasing or selling, long
      and/or short, securities of the Company, or "derivative" securities based on
      securities issued by the Company or to hold the Securities for any specified
      term; (ii) that past or future open market or other transactions by any Buyer,
      including, without limitation, short sales or "derivative" transactions, before
      or after the closing of this or future private placement transactions, may
      negatively impact the market price of the Company's publicly-traded securities;
      (iii) that any Buyer, and counter parties in "derivative" transactions to which
      any such Buyer is a party, directly or indirectly, presently may have a "short"
      position in the Common Stock, and (iv) that each Buyer shall not be deemed
      to
      have any affiliation with or control over any arm's length counter-party in
      any
      "derivative" transaction.  The Company further understands and
      acknowledges that (a) one or more Buyers may engage in hedging and/or trading
      activities at various times during the period that the Securities are
      outstanding, including, without limitation, during the periods that the value
      of
      the Conversion Shares and the Warrant Shares
      deliverable with respect to Securities are being determined and (b) such hedging
      and/or trading activities (if any) can reduce the value of the existing
      stockholders' equity interest in the Company at and after the time the hedging
      and/or trading activities are being conducted.  The Company
      acknowledges that such aforementioned hedging and/or trading activities do
      not
      constitute a breach of this Agreement, the Notes, the Warrants or any of the
      documents executed in connection herewith.

    
      
        
        

      

      
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    4.        
          COVENANTS.

    

    (a)        
         Best
      Efforts.  Each party shall use its best efforts timely to
      satisfy each of the conditions to be satisfied by it as provided in Sections
      6
      and 7 of this Agreement.

    

    (b)     
            Form D and Blue
      Sky.  The Company agrees to file a Form D, if required under
      U.S. securities laws, with respect to the Securities as required under
      Regulation D and to provide a copy thereof to each Buyer promptly after such
      filing.  The Company shall, on or before the Closing Date, take such
      action as the Company shall reasonably determine is necessary in order to obtain
      an exemption for or to qualify the Securities for sale to the Buyers at the
      Closing pursuant to this Agreement under applicable securities or "Blue Sky"
      laws of the states of the United States (or to obtain an exemption from such
      qualification), and shall provide evidence of any such action so taken to the
      Buyers on or prior to the Closing Date.  The Company shall make all
      filings and reports relating to the offer and sale of the Securities required
      under applicable securities or "Blue Sky" laws of the states of the United
      States following the Closing Date.

    

    (c)        
         Reporting
      Status.  Until the date on which the Investors (as defined in
      the Registration Rights Agreement) shall have sold all the Conversion Shares
      and
      Warrant Shares and
      none of the Notes or Warrants is
      outstanding, (the "Reporting
      Period"), the Company shall timely file all reports required to be filed
      with the SEC pursuant to the 1934 Act, and the Company shall not terminate
      its
      status as an issuer required to file reports under the 1934 Act even if the
      1934
      Act or the rules and regulations thereunder would no longer require or otherwise
      permit such termination, and the Company shall take all actions necessary to
      maintain its eligibility to register the Conversion Shares and Warrant Shares
      for resale by the Buyers on Form SB-2.

    

    (d)      
           Use of
      Proceeds.  The Company will use the proceeds from the sale of
      the Securities for general corporate purposes, including general and
      administrative expenses and not for (i) the repayment of any outstanding
      Indebtedness of the Company or any of its Subsidiaries or (ii) the redemption
      or
      repurchase of any of its or its Subsidiaries' equity securities.

    

    (e)       
          Financial
      Information.  As long as any Notes or Warrants are outstanding,
      the Company agrees to send the following to each Investor (as defined in the
      Registration Rights Agreement) during the Reporting Period (i) unless the
      following are filed with the SEC through EDGAR and are available to the public
      through the EDGAR system, within one (1) Business Day after the filing thereof
      with the SEC, a copy of its Annual Reports and Quarterly Reports on Form 10-K,
      10-KSB, 10-Q or 10-QSB, any interim reports or any consolidated balance sheets,
      income statements, stockholders' equity statements and/or cash flow statements
      for any period other than annual, any Current Reports on Form 8-K and any
      registration statements (other than on Form S-8) or amendments filed pursuant
      to
      the 1933 Act, (ii) on the same day as the release thereof, facsimile or e-mailed
      copies of all press releases issued by the Company or any of its Subsidiaries,
      and (iii) copies of any notices and other information made available or given
      to
      the stockholders of the Company generally, contemporaneously with the making
      available or giving thereof to the stockholders.  As used herein,
      "Business Day" means any
      day other than Saturday, Sunday or other day on which commercial banks in The
      City of New York are authorized or required by law to remain
      closed.

    
      
        
        

      

      
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    (f)        
          Listing.  The
      Company shall promptly secure the listing of all of the Registrable Securities
      (as defined in the Registration Rights Agreement) upon each national securities
      exchange and automated quotation system, if any, upon which the Common Stock
      is
      then listed (subject to official notice of issuance) and shall maintain, in
      accordance with the Notes and Warrants, such listing of all Registrable
      Securities from time to time issuable under the terms of the Transaction
      Documents.  The Company shall maintain the Common Stocks'
      authorization for quotation on the Principal Market.  Neither the
      Company nor any of its Subsidiaries shall take any action which would be
      reasonably expected to result in the delisting or suspension of the Common
      Stock
      on the Principal Market.  The Company shall pay all fees and expenses
      in connection with satisfying its obligations under this Section
      4(f).

    

    (g)        
         Fees.  Subject
      to Section 8 below, at Closing, the Company shall pay an expense allowance
      to
      Highbridge International LLC (a Buyer) or its designee(s) (in addition to any
      other expense amounts paid to any Buyer prior to the date of this Agreement)
      for
      all reasonable costs and expenses incurred in connection with the transactions
      contemplated by the Transaction Documents (including all reasonable legal fees
      and disbursements in connection therewith, documentation and implementation
      of
      the transactions contemplated by the Transaction Documents and due diligence
      in
      connection therewith), in the amount of $90,000, which amount shall be withheld
      by such Buyer from its Purchase Price at the Closing.  The Company
      shall be responsible for the payment of any placement agent's fees, financial
      advisory fees, or broker's commissions relating to or arising out of the
      transactions contemplated hereby, including, without limitation, any fees
      payable to the Agent.  The Company shall pay, and hold each Buyer
      harmless against, any liability, loss or expense (including, without limitation,
      reasonable attorney's fees and out-of-pocket expenses) arising in connection
      with any claim relating to any such payment.

    

    (h)       
          Pledge of
      Securities.  The Company acknowledges and agrees that the
      Securities may be pledged by an Investor (as defined in the Registration Rights
      Agreement) in connection with a bona fide margin agreement or other loan or
      financing arrangement that is secured by the Securities.  The pledge
      of Securities shall not be deemed to be a transfer, sale or assignment of the
      Securities hereunder, and no Investor effecting a pledge of Securities shall
      be
      required to provide the Company with any notice thereof or otherwise make any
      delivery to the Company pursuant to this Agreement or any other Transaction
      Document, including, without limitation, Section 2(f) hereof; provided that
      an
      Investor and its pledgee shall be required to comply with the provisions of
      Section 2(f) hereof in order to effect a sale, transfer or assignment of
      Securities to such pledgee.  The Company hereby agrees to execute and
      deliver such documentation as a pledgee of the Securities may reasonably request
      in connection with a pledge of the Securities to such pledgee by an
      Investor.

    
      
        
        

      

      
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          19
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    (i)       
           Disclosure of Transactions
      and Other Material Information.  On or before 8:30 a.m., New
      York City time, on the first Business Day following the date of this Agreement,
      the Company shall issue a press release and file a Current Report on Form 8-K
      describing the terms of the transactions contemplated by the Transaction
      Documents in the form required by the 1934 Act and attaching the material
      Transaction Documents (including, without limitation, this Agreement, the form
      of the Notes, the form of Warrant and the form of the Registration Rights
      Agreement) as exhibits to such filing (including all attachments, the "8-K Filing").  From
      and after the filing of the 8-K Filing with the SEC, no Buyer shall be in
      possession of any material, nonpublic information received from the Company,
      any
      of its Subsidiaries or any of their respective officers, directors, employees
      or
      agents, that is not disclosed in the 8-K Filing.  The Company shall
      not, and shall cause each of its Subsidiaries and its and each of their
      respective officers, directors, employees and agents, not to, provide any Buyer
      with any material, nonpublic information regarding the Company or any of its
      Subsidiaries from and after the filing of the 8-K Filing with the SEC without
      the express prior written consent of such Buyer.  If a Buyer has, or
      believes it has, received any such material, nonpublic information regarding
      the
      Company or any of its Subsidiaries, it shall provide the Company with written
      notice thereof.  The Company shall, within five (5) Trading Days (as
      defined in the Notes) of receipt of such notice, make public disclosure of
      such
      material, nonpublic information.  In the event of a breach of the
      foregoing covenant by the Company, any of its Subsidiaries, or any of its or
      their respective officers, directors, employees and agents, in addition to
      any
      other remedy provided herein or in the Transaction Documents, a Buyer shall
      have
      the right to make a public disclosure, in the form of a press release, public
      advertisement or otherwise, of such material, nonpublic information without
      the
      prior approval by the Company, its Subsidiaries, or any of its or their
      respective officers, directors, employees or agents.  No Buyer shall
      have any liability to the Company, its Subsidiaries, or any of its or their
      respective officers, directors, employees, stockholders or agents for any such
      disclosure.  Subject to the foregoing, neither the Company, its
      Subsidiaries nor any Buyer shall issue any press releases or any other public
      statements with respect to the transactions contemplated hereby; provided,
      however, that the Company shall be entitled, without the prior approval of
      any
      Buyer, to make any press release or other public disclosure with respect to
      such
      transactions (i) in substantial conformity with the 8-K Filing and
      contemporaneously therewith and (ii) as is required by applicable law and
      regulations (provided that in the case of clause (i) each Buyer shall be
      consulted by the Company in connection with any such press release or other
      public disclosure prior to its release).  Without the prior written
      consent of any applicable Buyer, neither the Company nor any of its Subsidiaries
      or affiliates shall disclose the name of such Buyer in any filing, announcement,
      release or otherwise.

    

    (j)         
         Restriction on Redemption
      and Cash Dividends.  So long as any Notes are outstanding, the
      Company shall not, directly or indirectly, redeem, or declare or pay any cash
      dividend or distribution on, the Common Stock without the prior express written
      consent of the holders of Notes representing not less than a majority of the
      aggregate principal amount of the then outstanding Notes.

    
      
        
        

      

      
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    (k)       
          Additional Notes;
      Variable
      Securities; Dilutive Issuances.  So long as any Buyer
      beneficially owns any Securities, the Company will not issue any Notes other
      than to the Buyers as contemplated hereby and the Company shall not issue any
      other securities that would cause a breach or default under the
      Notes.  For so long as any Notes or Warrants remain outstanding, the
      Company shall not, in any manner, issue or sell any rights, warrants or options
      to subscribe for or purchase Common Stock or directly or indirectly convertible
      into or exchangeable or exercisable for Common Stock at a price which varies
      or
      may vary with the market price of the Common Stock, including by way of one
      or
      more reset(s) to any fixed price unless the conversion, exchange or exercise
      price of any such security cannot be less than the then applicable Conversion
      Price (as defined in the Notes)with respect to the Common Stock into which
      any
      Note is convertible or the then applicable Exercise Price (as defined in the
      Warrants) with respect to the Common Stock into which any Warrant is
      exercisable.  For so long as any Notes or Warrants remain outstanding,
      the Company shall not, in any manner, enter into or affect any Dilutive Issuance
      (as defined in the Notes) if the effect of such Dilutive Issuance is to cause
      the Company to be required to issue upon conversion of any Note or exercise
      of
      any Warrant any shares of Common Stock in excess of that number of shares of
      Common Stock which the Company may issue upon conversion of the Notes and
      exercise of the Warrants without breaching the Company's obligations under
      the
      rules or regulations of the Principal Market.

    

    (l)        
          Corporate
      Existence.  So long as any Buyer beneficially owns any
      Securities, the Company shall not be party to any Fundamental Transaction (as
      defined in the Notes) unless the Company is in compliance with the applicable
      provisions governing Fundamental Transactions set forth in the Notes and the
      Warrants.

    

    (m)         Reservation
      of Shares.  The Company shall
      take all action necessary to at all times have authorized, and reserved for
      the
      purpose of issuance, no less than 130% of the sum of  the number of
      shares of Common Stock issuable (i) upon conversion of the Notes issued at
      the
      Closing and (ii) upon exercise of the Warrants issued at the Closing (without
      taking into account any limitations on the Conversion of the Notes or exercise
      of the Warrants set forth in the Notes and Warrants, respectively).

    

    (n)       
          Conduct of
      Business.  The business of the Company and its Subsidiaries
      shall not be conducted in violation of any law, ordinance or regulation of
      any
      governmental entity, except where such violations would not result, either
      individually or in the aggregate, in a Material Adverse Effect.

    

    (o)        
         Additional Issuances
      of
      Securities.

    

    (i)           For
      purposes of this Section 4(o), the following definitions shall
      apply.

    

    (1)           "Convertible
      Securities" means
      any stock or securities (other than Options) convertible into or exercisable
      or
      exchangeable for shares of Common Stock.

    

    (2)           "Options"
      means any rights,
      warrants or options to subscribe for or purchase shares of Common Stock or Convertible
      Securities.

    
      
        
        

      

      
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          21
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    (3)           "Common
      Stock Equivalents"
      means, collectively, Options and Convertible Securities.

    

    (ii)           From
      the date hereof until the date that is thirty (30) Trading Days (as defined
      in
      the Notes) following the Effective Date (as defined in the Registration Rights
      Agreement) (the "Trigger
      Date"), the Company will not, directly or indirectly, file any
      registration statement with the SEC other than the Registration Statement (as
      defined in the Registration Rights Agreement).  From the date hereof
      until the Trigger Date, the Company will not, directly or indirectly, offer,
      sell, grant any option to purchase, or otherwise dispose of (or announce any
      offer, sale, grant or any option to purchase or other disposition of) any of
      its
      or its Subsidiaries' equity or equity equivalent securities, including without
      limitation any debt, preferred stock or other instrument or security that is,
      at
      any time during its life and under any circumstances, convertible into or
      exchangeable or exercisable for shares of Common Stock or Common Stock
      Equivalents (any such offer, sale, grant, disposition or announcement being
      referred to as a "Subsequent
      Placement").

    

    (iii)           From
      the Trigger Date until the later of (x) the second anniversary of the Closing
      Date, and (y) such time as there no longer any Notes, the Company will not,
      directly or indirectly, effect any Subsequent Placement unless the Company
      shall
      have first complied with this Section 4(o)(iii).

    

    (1)           The
      Company shall deliver to each Buyer an irrevocable written notice (the "Offer Notice") of any proposed
      or intended issuance or sale or exchange (the "Offer") of the securities
      being offered (the "Offered
      Securities") in a Subsequent Placement, which Offer Notice shall (w)
      identify and describe the Offered Securities, (x) describe the price and other
      terms upon which they are to be issued, sold or exchanged, and the number or
      amount of the Offered Securities to be issued, sold or exchanged, (y) identify
      the persons or entities (if known) to which or with which the Offered Securities
      are to be offered, issued, sold or exchanged and (z) offer to issue and sell
      to
      or exchange with such Buyers at least fifty percent (50%) of the Offered
      Securities, allocated among such Buyers (a) based on such Buyer's pro rata
      portion of the aggregate principal amount of Notes purchased hereunder (the
      "Basic Amount"), and (b)
      with respect to each Buyer that elects to purchase its Basic Amount, any
      additional portion of the Offered Securities attributable to the Basic Amounts
      of other Buyers as such Buyer shall indicate it will purchase or acquire should
      the other Buyers subscribe for less than their Basic Amounts (the "Undersubscription Amount"),
      which process shall be repeated until the Buyers shall have an opportunity
      to
      subscribe for any remaining Undersubscription Amount.

    

    (2)           To
      accept an Offer, in whole or in part, such Buyer must deliver a written notice
      to the Company prior to the end of the tenth (10th)
      Business Day after such Buyer's receipt of the Offer Notice (the "Offer Period"), setting forth
      the portion of such Buyer's Basic Amount that such Buyer elects to purchase
      and,
      if such Buyer shall elect to purchase all of its Basic Amount, the
      Undersubscription Amount, if any, that such Buyer elects to purchase (in either
      case, the "Notice of
      Acceptance").  If the Basic Amounts subscribed for by all
      Buyers are less than the total of all of the Basic Amounts, then each Buyer
      who
      has set forth an Undersubscription Amount in its Notice of Acceptance shall
      be
      entitled to purchase, in addition to the Basic Amounts subscribed for, the
      Undersubscription Amount it has subscribed for; provided, however,
      that if the
      Undersubscription Amounts subscribed for exceed the difference between the
      total
      of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription
      Amount"), each Buyer who has subscribed for any Undersubscription Amount
      shall be entitled to purchase only that portion of the Available
      Undersubscription Amount as the Basic Amount of such Buyer bears to the total
      Basic Amounts of all Buyers that have subscribed for Undersubscription Amounts,
      subject to rounding by the Company to the extent it deems reasonably necessary.
      Notwithstanding the foregoing, if the Company desires to modify or amend the
      terms and conditions of the Offer prior to the expiration of the Offer Period,
      the Company may deliver to the Buyers a new Offer Notice and the Offer Period
      shall expire on the third Business Day after such Buyer’s receipt of such new
      Offer Notice.

    
      
        
        

      

      
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          22
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    (3)           The
      Company shall have fifteen (15) Business Days from the expiration of the Offer
      Period above to offer, issue, sell or exchange all or any part of such Offered
      Securities as to which a Notice of Acceptance has not been given by the Buyers
      (the "Refused
      Securities"), but only to the offerees described in the Offer Notice (if
      so described therein) and only upon terms and conditions (including, without
      limitation, unit prices and interest rates) that are not more favorable to
      the
      acquiring person or persons or less favorable to the Company than those set
      forth in the Offer Notice and (ii) to publicly announce (a) the execution of
      such Subsequent Placement Agreement, and (b) either (x) the consummation of
      the
      transactions contemplated by such Subsequent Placement Agreement or (y) the
      termination of such Subsequent Placement Agreement, which shall be filed with
      the SEC on a Current Report on Form 8-K with such Subsequent Placement Agreement
      and any documents contemplated therein filed as exhibits thereto.

    

    (4)           In
      the event the Company shall propose to sell less than all the Refused Securities
      (any such sale to be in the manner and on the terms specified in Section
      4(o)(iii)(3) above), then each Buyer may, at its sole option and in its sole
      discretion, reduce the number or amount of the Offered Securities specified
      in
      its Notice of Acceptance to an amount that shall be not less than the number
      or
      amount of the Offered Securities that such Buyer elected to purchase pursuant
      to
      Section 4(o)(iii)(2) above multiplied by a fraction, (i) the numerator of which
      shall be the number or amount of Offered Securities the Company actually
      proposes to issue, sell or exchange (including Offered Securities to be issued
      or sold to Buyers pursuant to Section 4(o)(iii)(3) above prior to such
      reduction) and (ii) the denominator of which shall be the original amount of
      the
      Offered Securities.  In the event that any Buyer so elects to reduce
      the number or amount of Offered Securities specified in its Notice of
      Acceptance, the Company may not issue, sell or exchange more than the reduced
      number or amount of the Offered Securities unless and until such securities
      have
      again been offered to the Buyers in accordance with Section 4(o)(iii)(1)
      above.

    

    (5)           Upon
      the closing of the issuance, sale or exchange of all or less than all of the
      Refused Securities, the Buyers shall acquire from the Company, and the Company
      shall issue to the Buyers, the number or amount of Offered Securities specified
      in the Notices of Acceptance, as reduced pursuant to Section 4(o)(iii)(4) above
      if the Buyers have so elected, upon the terms and conditions specified in the
      Offer.  Notwithstanding anything to the contrary contained in this
      Agreement, if the Company does not consummate the closing of the issuance,
      sale
      or exchange of all or less than all of the Refused Securities within fifteen
      (15) Business Days of the expiration of the Offer Period, the Company shall
      issue to the Buyers the number or amount of Offered Securities specified in
      the
      Notices of Acceptance, as reduced pursuant to Section 4(o)(iii)(4) above if
      the
      Buyers have so elected, upon the terms and conditions specified in the
      Offer.  The purchase by the Buyers of any Offered Securities is
      subject in all cases to the preparation, execution and delivery by the Company
      and the Buyers of a purchase agreement relating to such Offered Securities
      reasonably satisfactory in form and substance to the Buyers and their respective
      counsel.

    
      
        
        

      

      
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          -

        
          

        

      

      
        
        

      

    

    (6)           Any
      Offered Securities not acquired by the Buyers or other persons in accordance
      with Section 4(o)(iii)(3) above may not be issued, sold or exchanged until
      they
      are again offered to the Buyers under the procedures specified in this
      Agreement.

    

    (7)           The
      Company and the Buyers agree that if any Buyer elects to participate in the
      Offer, (x) neither the agreement regarding the Subsequent Placement (the "Subsequent Placement
      Agreement") with respect to such Offer nor any other transaction
      documents related thereto (collectively, the "Subsequent Placement
      Documents") shall include any term or provisions whereby any Buyer shall
      be required to agree to any restrictions in trading as to any securities of
      the
      Company owned by such Buyer prior to such Subsequent Placement, and (y) any
      registration rights set forth in such Subsequent Placement Documents shall
      be
      similar in all material respects to the registration rights contained in the
      Registration Rights Agreement.

    

    (8)           Notwithstanding
      anything to the contrary in this Section 4(o) and unless otherwise agreed to
      by
      the Buyers, the Company shall either confirm in writing to the Buyers that
      the
      transaction with respect to the Subsequent Placement has been abandoned or
      shall
      publicly disclose its intention to issue the Offered Securities, in either
      case
      in such a manner such that the Buyers will not be in possession of material
      non-public information, by the fifteen (15th)
      Business Day following delivery of the Offer Notice.  If by the
      fifteen (15th)
      Business Day following delivery of the Offer Notice no public disclosure
      regarding a transaction with respect to the Offered Securities has been made,
      and no notice regarding the abandonment of such transaction has been received
      by
      the Buyers, such transaction shall be deemed to have been abandoned and the
      Buyers shall not be deemed to be in possession of any material, non-public
      information with respect to the Company.  Should the Company decide to
      pursue such transaction with respect to the Offered Securities, the Company
      shall provide each Buyer with another Offer Notice and each Buyer will again
      have the right of participation set forth in this Section
      4(o)(iii).  The Company shall not be permitted to deliver more than
      one such Offer Notice to the Buyers in any 60 day period.

    
      
        
        

      

      
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          24
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    (iv)           The
      restrictions contained in subsections (ii) and (iii) of this Section 4(o) shall
      not apply in connection with the issuance of any Excluded Securities (as defined
      in the Notes).

    

    (p)           Closing
      Documents.  On or prior to fourteen (14) calendar days after
      the Closing Date, the Company agrees to deliver, or cause to be delivered,
      to
      each Buyer and Schulte Roth & Zabel LLP executed copies of the Transaction
      Documents, Securities and other document required to be delivered to any party
      pursuant to Section 7 hereof.

    

    (q)           Lock-Up.  The
      Company shall not amend or waive any provision of any of the Lock-Up Agreements
      (as defined below) except to extend the term of the lock-up period.

    

    (r)       
          No Reverse
      Split.  For so long as any Securities remain outstanding the
      Company shall not effect any reverse stock split, stock combination or other
      similar reclassification of any class of the Company's Common
      Stock.

    

    5.       
           REGISTER; TRANSFER
      AGENT
      INSTRUCTIONS.

    

    (a)     
            Register.  The
      Company shall maintain at its principal executive offices (or such other office
      or agency of the Company as it may designate by notice to each holder of
      Securities), a register for the Notes and the Warrants in which the Company
      shall record the name and address of the Person in whose name the Notes and the Warrants have
      been
      issued (including the name and address of each transferee), the principal amount
      of Notes held by such Person, the number of Conversion Shares issuable upon
      conversion of the Notes and the number of Warrant Shares issuable upon exercise
      of the Warrants held by such Person.  The Company shall keep the
      register open and available at all times during business hours for inspection
      of
      any Buyer or its legal representatives.

    

    (b)        
         Transfer Agent
      Instructions.  The Company shall issue irrevocable instructions
      to its transfer agent, and any subsequent transfer agent, to issue certificates
      or credit shares to the applicable balance accounts at The Depository Trust
      Company ("DTC"),
      registered in the name of each Buyer or its respective nominee(s), for the
      Conversion Shares and the Warrant Shares issued at the Closing or upon
      conversion of the Notes or exercise of the Warrants in such amounts as specified
      from time to time by each Buyer to the Company upon conversion of the Notes
      or
      exercise of the Warrants in the form of Exhibit D attached
      hereto (the "Irrevocable
      Transfer Agent Instructions").  The Company warrants that no
      instruction other than the Irrevocable Transfer Agent Instructions referred
      to
      in this Section 5(b), and stop transfer instructions to give effect to Section
      2(g) hereof, will be given by the Company to its transfer agent, and that the
      Securities shall otherwise be freely transferable on the books and records
      of
      the Company as and to the extent provided in this Agreement and the other
      Transaction Documents.  If a Buyer effects a sale, assignment or
      transfer of the Securities in accordance with Section 2(f), the Company shall
      permit the transfer and shall promptly instruct its transfer agent to issue
      one
      or more certificates or credit shares to the applicable balance accounts at
      DTC
      in such name and in such denominations as specified by such Buyer to effect
      such
      sale, transfer or assignment.  In the event that such sale, assignment
      or transfer involves Conversion Shares or Warrant Shares sold, assigned or
      transferred pursuant to an effective registration statement or pursuant to
      Rule
      144, the transfer agent shall issue such Securities to the Buyer, assignee
      or
      transferee, as the case may be, without any restrictive legend.  The
      Company acknowledges that a breach by it of its obligations hereunder will
      cause
      irreparable harm to a Buyer.  Accordingly, the Company acknowledges
      that the remedy at law for a breach of its obligations under this Section 5(b)
      will be inadequate and agrees, in the event of a breach or threatened breach
      by
      the Company of the provisions of this Section 5(b), that a Buyer shall be
      entitled to seek, in addition to all other available remedies, an order and/or
      injunction restraining any breach and requiring immediate issuance and transfer,
      without the necessity of showing economic loss and without any bond or other
      security being required.

    
      
        
        

      

      
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    6.           
       CONDITIONS TO
      THE COMPANY'S OBLIGATION TO SELL.

    

    The
      obligation of the Company hereunder to issue and sell the Notes and the related
      Warrants to each Buyer at the Closing is subject to the satisfaction, at or
      before the Closing Date, of each of the following conditions, provided that
      these conditions are for the Company's sole benefit and may be waived by the
      Company at any time in its sole discretion by providing each Buyer with prior
      written notice thereof:

    

     (i)            Such
      Buyer shall have executed each of the Transaction Documents to which it is
      a
      party and delivered the same to the Company.

    

    (ii)      
           Such Buyer and each other Buyer shall have
      delivered to the Company the Purchase Price (less, in the case of Highbridge
      International LLC, the amounts withheld pursuant to Section 4(g)) for the Notes
      and the related Warrants being purchased by such Buyer at the Closing by wire
      transfer of immediately available funds pursuant to the wire instructions
      provided by the Company or by surrender of such Buyer's Existing Debentures
      as
      contemplated by the Exchange Agreement.

    

    (iii)           The
      representations and warranties of such Buyer shall be true and correct in all
      material respects (except for those representations and warranties that are
      qualified by materiality or Material Adverse Effect, which shall be true and
      correct in all respects) as of the date when made and as of the Closing Date
      as
      though made at that time (except for representations and warranties that speak
      as of a specific date, which shall be true and correct as of such specified
      date), and such Buyer shall have performed, satisfied and complied in all
      material respects with the covenants, agreements and conditions required by
      this
      Agreement to be performed, satisfied or complied with by such Buyer at or prior
      to the Closing Date.

    

    7.         
         CONDITIONS TO EACH
      BUYER'S
      OBLIGATION TO PURCHASE.

    

    The
      obligation of each Buyer hereunder to purchase the Notes and the related Warrants
      at the Closing is subject to the satisfaction, at or before the Closing Date,
      of
      each of the following conditions, provided that these conditions are for each
      Buyer's sole benefit and may be waived by such Buyer at any time in its sole
      discretion by providing the Company with prior written notice
      thereof:

    

    (i)           The
      Company shall have duly executed and delivered to such Buyer (i) each of the
      Transaction Documents and (ii) the Notes (allocated in such principal amounts
      as
      such Buyer shall request), being purchased by such Buyer at the Closing pursuant
      to this Agreement, and (iii) the related Warrants (allocated in such amounts
      as
      such Buyer shall request) being purchased by such Buyer at the Closing pursuant
      to this Agreement.

    
      
        
        

      

      
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    (ii)          Such
      Buyer shall have received the opinion of Andrew N. Bernstein, P.C., the
      Company's outside counsel, dated as of the Closing Date, in substantially the
      form of Exhibit
      E attached hereto.

    

    (iii)         The
      Company shall have delivered to such Buyer a copy of the Irrevocable Transfer
      Agent Instructions, in the form of Exhibit D attached
      hereto, which instructions shall have been delivered to and acknowledged in
      writing by the Company's transfer agent.

    

    (iv)        The
      Company shall have delivered to such Buyer a certificate  evidencing
      the formation and good standing of the Company and each of its Subsidiaries
      in
      such entity's jurisdiction of formation issued by the Secretary of State (or
      comparable office) of such jurisdiction, as of a date within ten (10) days
      of
      the Closing Date.

    

    (v)         The
      Company shall have delivered to such Buyer a certificate  evidencing
      the Company's qualification as a foreign corporation and good standing issued
      by
      the Secretary of State (or comparable office) of each jurisdiction in which
      the
      Company conducts business, as of a date within ten (10) days of the Closing
      Date.

    

    (vi)        The
      Company shall have delivered to such Buyer a certified copy of the Articles
      of
      Incorporation as certified by the Secretary of State of the State of
      Nevada  within ten (10) days of the Closing Date.

    

    (vii)       The
      Company shall have delivered to such Buyer a certificate, executed by the
      Secretary of the Company and dated as of the Closing Date, as to (i) the
      resolutions consistent with Section 3(b) as adopted by the Company's Board
      of
      Directors in a form reasonably acceptable to such Buyer, (ii) the Articles
      of
      Incorporation and (iii) the Bylaws, each as in effect at the Closing, in the
      form attached hereto as Exhibit
      F.

    

    (viii)      The
      representations and warranties of the Company shall be true and correct in
      all
      material respects (except for those representations and warranties that are
      qualified by materiality or Material Adverse Effect, which shall be true and
      correct in all respects) as of the date when made and as of the Closing Date
      as
      though made at that time (except for representations and warranties that speak
      as of a specific date, which shall be true and correct as of such specified
      date) and the Company shall have performed, satisfied and complied in all
      material respects with the covenants, agreements and conditions required by
      the
      Transaction Documents to be performed, satisfied or complied with by the Company
      at or prior to the Closing Date.  Such Buyer shall have received a
      certificate, executed by the Chief Executive Officer of the Company, dated
      as of
      the Closing Date, to the foregoing effect and as to such other matters as may
      be
      reasonably requested by such Buyer in the form attached hereto as Exhibit
      G.

    

    (ix)         The
      Company shall have delivered to such Buyer a letter from the Company's transfer
      agent certifying the number of shares of Common Stock outstanding as of a date
      within five days of the Closing Date.

    
      
        
        

      

      
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          27
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    (x)    
           The Common Stock (I) shall be designated for
      quotation or listed on the Principal Market and (II) shall not have been
      suspended, as of the Closing Date, by the SEC or the Principal Market from
      trading on the Principal Market nor shall suspension by the SEC or the Principal
      Market have been threatened, as of the Closing Date, either (A) in writing
      by
      the SEC or the Principal Market or (B) by falling below the minimum listing
      maintenance requirements of the Principal Market.

    

    (xi)         The
      Company shall have obtained all governmental, regulatory or third party consents
      and approvals, if any, necessary for the sale of the Securities.

    

    (xii)        In
      accordance with the terms of the Security Documents, the Company shall have
      delivered to the Collateral Agent (i) certificates representing the
      Subsidiaries' shares of capital stock to the extent such subsidiary is a
      corporation or otherwise has certificated capital stock, along with duly
      executed blank stock powers and (ii) appropriate financing statements on Form
      UCC-1 to be duly filed in such office or offices as may be necessary or, in
      the
      opinion of the Collateral Agent, desirable to perfect the security interests
      purported to be created by each Security Document.

    

    (xiii)       Within
      two (2) Business Days prior to the Closing, the Company shall have delivered
      or
      caused to be delivered to each Buyer (i) true copies of UCC search results,
      listing all effective financing statements which name as debtor the Company
      or
      any of its Subsidiaries filed in the prior five years to perfect an interest
      in
      any assets thereof, together with copies of such financing statements, none
      of
      which, except as otherwise agreed in writing by the Buyers, shall cover any
      of
      the Collateral (as defined in the Security Documents) and the results of
      searches for any tax lien and judgment lien filed against such Person or its
      property, which results, except as otherwise agreed to in writing by the Buyers
      shall not show any such Liens (as defined in the Security Documents); and (ii)
      a
      perfection certificate, duly completed and executed by the Company and each
      of
      its Subsidiaries, in form and substance satisfactory to the Buyers.

    

    (xiv)       Sam
      Jankovich, Private Capital Group LLC and Dean Galland shall have entered into
      a
      Lock-Up Agreement in the form attached hereto as Exhibit J (the "Lock-Up
      Agreement").

    

    (xv)        The
      Collateral Agent and each other Buyer shall have duly executed and delivered
      to
      such Buyer the Collateral Agency Agreement.

    

    (xvi)       The
      Company shall have delivered to such Buyer such other documents relating to
      the
      transactions contemplated by this Agreement as such Buyer or its counsel may
      reasonably request.

    

    8.          
        TERMINATION.  In
      the event that the Closing shall not have occurred with respect to a Buyer
      on or
      before five (5) Business Days from the date hereof due to the Company's or
      such
      Buyer's failure to satisfy the conditions set forth in Sections 6 and 7 above
      (and the nonbreaching party's failure to waive such unsatisfied condition(s)),
      the nonbreaching party shall have the option to terminate this Agreement with
      respect to such breaching party at the close of business on such date without
      liability of any party to any other party; provided, however,
      that if this
      Agreement is terminated pursuant to this Section 8, the Company shall remain
      obligated to reimburse the non-breaching Buyers for the expenses described
      in
      Section 4(g) above.

    
      
        
        

      

      
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    9.     
             MISCELLANEOUS.

    

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

    

    (b)           Counterparts.  This
      Agreement may be executed in two or more identical counterparts, all of which
      shall be considered one and the same agreement and shall become effective when
      counterparts have been signed by each party and delivered to the other party;
      provided that a facsimile signature shall be considered due execution and shall
      be binding upon the signatory thereto with the same force and effect as if
      the
      signature were an original, not a facsimile signature.

    

    (c)           Headings.  The
      headings of this Agreement are for convenience of reference and shall not form
      part of, or affect the interpretation of, this Agreement.

    

    (d)           Severability.  If
      any provision of this Agreement is prohibited by law or otherwise determined
      to
      be invalid or unenforceable by a court of competent jurisdiction, the provision
      that would otherwise be prohibited, invalid or unenforceable shall be deemed
      amended to apply to the broadest extent that it would be valid and enforceable,
      and the invalidity or unenforceability of such provision shall not affect the
      validity of the remaining provisions of this Agreement so long as this Agreement
      as so modified continues to express, without material change, the original
      intentions of the parties as to the subject matter hereof and the prohibited
      nature, invalidity or unenforceability of the provision(s) in question does
      not
      substantially impair the respective expectations or reciprocal obligations
      of
      the parties or the practical realization of the benefits that would otherwise
      be
      conferred upon the parties.  The parties will endeavor in good faith
      negotiations to replace the prohibited, invalid or unenforceable provision(s)
      with a valid provision(s), the effect of which comes as close as possible to
      that of the prohibited, invalid or unenforceable provision(s).

    
      
        
        

      

      
        -
          29
          -

        
          

        

      

      
        
        

      

    

    (e)           Entire
      Agreement;
      Amendments.  This Agreement and the other Transaction Documents
      supersede all other prior oral or written agreements between the Buyers, the
      Company, their affiliates and Persons acting on their behalf with respect to
      the
      matters discussed herein, and this Agreement, the other Transaction Documents
      and the instruments referenced herein and therein contain the entire
      understanding of the parties with respect to the matters covered herein and
      therein and, except as specifically set forth herein or therein, neither the
      Company nor any Buyer makes any representation, warranty, covenant or
      undertaking with respect to such matters.  No provision of this
      Agreement may be amended other than by an instrument in writing signed by the
      Company and the holders of at least a majority of the aggregate number of
      Registrable Securities issued and issuable hereunder and under the Notes, and
      any amendment to this Agreement made in conformity with the provisions of this
      Section 9(e) shall be binding on all Buyers and holders of Securities as
      applicable.  No provision hereof may be waived other than by an
      instrument in writing signed by the party against whom enforcement is
      sought.  No such amendment shall be effective to the extent that it
      applies to less than all of the holders of the applicable Securities then
      outstanding.  No consideration shall be offered or paid to any Person
      to amend or consent to a waiver or modification of any provision of any of
      the
      Transaction Documents unless the same consideration also is offered to all
      of
      the parties to the Transaction Documents, holders of Notes or holders of the
      Warrants, as the case may be.  The Company has not, directly or
      indirectly, made any agreements with any Buyers relating to the terms or
      conditions of the transactions contemplated by the Transaction Documents except
      as set forth in the Transaction Documents.  Without limiting the
      foregoing, the Company confirms that, except as set forth in this Agreement,
      no
      Buyer has made any commitment or promise or has any other obligation to provide
      any financing to the Company or otherwise.

    

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

    

    If
      to the
      Company:

    

    EnterConnect
      Inc.

    100
      Century Center Court

    Suite
      650

    San
      Jose,
      California 95112-4537

    Telephone:    
      (408) 441-9500

    Facsimile:      
      (408) 452-9040

    Attention:     
      Sam Jankovich

    
      
        
        

      

      
        -
          30
          -

        
          

        

      

      
        
        

      

    

    Copy
      to:

    

    Andrew
      N.
      Bernstein, P.C.

    5445
      DTC
      Parkway, Suite 520

    Greenwood
      Village, Colorado 80111

    Facsimile
      No.:     (303) 770-7332

    Telephone
      No.:  (303) 770-7131

    Attn.:
      Andrew N. Bernstein, Esq.

    

    

    If
      to the
      Transfer Agent:

    

    Interwest
      Transfer Co., Inc.

    1981
      East
      4800 South, Suite 100

    PO
      Box
      17136

    Salt
      Lake
      City, UT 84117

    Telephone:   801-272-9294

    Facsimile:     
      801-277-3147

    Attention:     Kurt
      Hughes

    

    If
      to a
      Buyer, to its address and facsimile number set forth on the Schedule of Buyers,
      with copies to such Buyer's representatives as set forth on the Schedule of
      Buyers,

    

    with
      a
      copy (for informational purposes only) to:

    

    Schulte
      Roth & Zabel LLP

    919
      Third
      Avenue

    New
      York,
      New York  10022

    Telephone:      
      (212) 756-2000

    Facsimile:         
      (212) 593-5955

    Attention:        
      Eleazer N. Klein, Esq.

    

    or
      to
      such other address and/or facsimile number and/or to the attention of such
      other
      Person as the recipient party has specified by written notice given to each
      other party five (5) days prior to the effectiveness of such
      change.  Written confirmation of receipt (A) given by the recipient of
      such notice, consent, waiver or other communication, (B) mechanically or
      electronically generated by the sender's facsimile machine containing the time,
      date, recipient facsimile number and an image of the first page of such
      transmission or (C) provided by an overnight courier service shall be rebuttable
      evidence of personal service, receipt by facsimile or receipt from an overnight
      courier service in accordance with clause (i), (ii) or (iii) above,
      respectively.

    

    (g)           Successors
      and
      Assigns.  This Agreement shall be binding upon and inure to the
      benefit of the parties and their respective successors and assigns, including
      any purchasers of the Notes or the Warrants.  The Company shall not
      assign this Agreement or any rights or obligations hereunder without the prior
      written consent of the holders of at least a majority of the aggregate number
      of
      Registrable Securities issued and issuable hereunder and under the Notes,
      including by way of a Fundamental Transaction (unless the Company is in
      compliance with the applicable provisions governing Fundamental Transactions
      set
      forth in the Notes and the Warrants).  A Buyer may assign some or all
      of its rights hereunder without the consent of the Company, in which event
      such
      assignee shall be deemed to be a Buyer hereunder with respect to such assigned
      rights

    
      
        
        

      

      
        -
          31
          -

        
          

        

      

      
        
        

      

    

    (h)           No
      Third Party
      Beneficiaries.  This Agreement is intended for the benefit of
      the parties hereto and their respective permitted successors and assigns, and
      is
      not for the benefit of, nor may any provision hereof be enforced by, any other
      Person.

    

    (i)           Survival.  Unless
      this Agreement is terminated under Section 8, the representations and warranties
      of the Company and the Buyers contained in Sections 2 and 3, and the agreements
      and covenants set forth in Sections 4, 5 and 9 shall survive the Closing and
      the
      delivery and exercise of Securities, as applicable.  Each Buyer shall
      be responsible only for its own representations, warranties, agreements and
      covenants hereunder.

    

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

    

    (k)           Indemnification.  In
      consideration of each Buyer's execution and delivery of the Transaction
      Documents and acquiring the Securities thereunder and in addition to all of
      the
      Company's other obligations under the Transaction Documents, the Company shall
      defend, protect, indemnify and hold harmless each Buyer and each other holder
      of
      the Securities and all of their stockholders, partners, members, officers,
      directors, employees and direct or indirect investors and any of the foregoing
      Persons' agents or other representatives (including, without limitation, those
      retained in connection with the transactions contemplated by this Agreement)
      (collectively, the "Indemnitees") from and against
      any and all actions, causes of action, suits, claims, losses, costs, penalties,
      fees, liabilities and damages, and expenses in connection therewith
      (irrespective of whether any such Indemnitee is a party to the action for which
      indemnification hereunder is sought), and including reasonable attorneys' fees
      and disbursements (the "Indemnified Liabilities"),
      incurred by any Indemnitee as a result of, or arising out of, or relating to
      (a)
      any misrepresentation or breach of any representation or warranty made by the
      Company in the Transaction Documents or any other certificate, instrument or
      document contemplated hereby or thereby, (b) any breach of any covenant,
      agreement or obligation of the Company contained in the Transaction Documents
      or
      any other certificate, instrument or document contemplated hereby or thereby
      or
      (c) any cause of action, suit or claim brought or made against such Indemnitee
      by a third party (including for these purposes a derivative action brought
      on
      behalf of the Company) and arising out of or resulting from (i) the execution,
      delivery, performance or enforcement of the Transaction Documents or any other
      certificate, instrument or document contemplated hereby or thereby, (ii) any
      transaction financed or to be financed in whole or in part, directly or
      indirectly, with the proceeds of the issuance of the Securities, (iii) any
      disclosure made by such Buyer pursuant to Section 4(i), or (iv) the status
      of
      such Buyer or holder of the Securities as an investor in the Company pursuant
      to
      the transactions contemplated by the Transaction Documents.  To the
      extent that the foregoing undertaking by the Company may be unenforceable for
      any reason, the Company shall make the maximum contribution to the payment
      and
      satisfaction of each of the Indemnified Liabilities that is permissible under
      applicable law.  Except as otherwise set forth herein, the mechanics
      and procedures with respect to the rights and obligations under this Section
      9(k) shall be the same as those set forth in Section 6 of the Registration
      Rights Agreement.

    
      
        
        

      

      
        -
          32
          -

        
          

        

      

      
        
        

      

    

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

    

    (m)           Remedies.  Each
      Buyer and each holder of the Securities shall have all rights and remedies
      set
      forth in the Transaction Documents and all rights and remedies which such
      holders have been granted at any time under any other agreement or contract
      and
      all of the rights which such holders have under any law.  Any Person
      having any rights under any provision of this Agreement shall be entitled to
      enforce such rights specifically (without posting a bond or other security),
      to
      recover damages by reason of any breach of any provision of this Agreement
      and
      to exercise all other rights granted by law.  Furthermore, the Company
      recognizes that in the event that it fails to perform, observe, or discharge
      any
      or all of its obligations under the Transaction Documents, any remedy at law
      may
      prove to be inadequate relief to the Buyers.  The Company therefore
      agrees that the Buyers shall be entitled to seek temporary and permanent
      injunctive relief in any such case without the necessity of proving actual
      damages and without posting a bond or other security.

    

    (n)           Rescission
      and Withdrawal
      Right.  Notwithstanding anything to the contrary contained in
      (and without limiting any similar provisions of) the Transaction Documents,
      whenever any Buyer exercises a right, election, demand or option under a
      Transaction Document and the Company does not timely perform its related
      obligations within the periods therein provided, then such Buyer may rescind
      or
      withdraw, in its sole discretion from time to time upon written notice to the
      Company, any relevant notice, demand or election in whole or in part without
      prejudice to its future actions and rights.

    

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

    
      
        
        

      

      
        -
          33
          -

        
          

        

      

      
        
        

      

    

    (p)           Independent
      Nature of
      Buyers' Obligations and Rights.  The obligations of each Buyer
      under any Transaction Document are several and not joint with the obligations
      of
      any other Buyer, and no Buyer shall be responsible in any way for the
      performance of the obligations of any other Buyer under any Transaction
      Document.  Nothing contained herein or in any other Transaction
      Document, and no action taken by any Buyer pursuant hereto or thereto, shall
      be
      deemed to constitute the Buyers as, and the Company acknowledges that the Buyers
      do not so constitute, a partnership, an association, a joint venture or any
      other kind of entity, or create a presumption that the Buyers are in any way
      acting in concert or as a group, and the Company will not assert any such claim
      with respect to such obligations or the transactions contemplated by the
      Transaction Documents and the Company acknowledges that the Buyers are not
      acting in concert or as a group with respect to such obligations or the
      transactions contemplated by the Transaction Documents.  The Company
      acknowledges and each Buyer confirms that it has independently participated
      in
      the negotiation of the transaction contemplated hereby with the advice of its
      own counsel and advisors.  Each Buyer shall be entitled to
      independently protect and enforce its rights, including, without limitation,
      the
      rights arising out of this Agreement or out of any other Transaction Documents,
      and it shall not be necessary for any other Buyer to be joined as an additional
      party in any proceeding for such purpose.

    

    [Signature
      Page Follows]

    
      
        
        

      

      
        -
          34
          -

        
          

        

      

      
        
        

      

    

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

    

    

    
      	 	
              COMPANY:

            	 
	 	 	 	 
	 	
              ENTERCONNECT
                INC.

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:  Sam
                Jankovich

            	 
	 	 	
              Title:  Chairman
                & Chief Executive

            	 
	 	 	
              Officer

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    

    
      	 	
              BUYERS:

            	 
	 	 	 	 
	 	
              HIGHBRIDGE
                INTERNATIONAL LLC

            	 
	 	
              By:
                Highbridge Capital Management LLC

            	 
	 	
              Its
                Trading Manager

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              ALAN
                JOHN MURRAY

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              ALAN
                YOSHIHARA SERIKAWA

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              BRIAN
                L, GROETSCH, SR.

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              VALERIE
                CHEESEMAN

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              CHRISTOPHER
                J. EIGEL

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              DAVID
                R. SPENCER

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              MADELINE
                GAYLE ADAMS

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              GRANT
                LAU

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              JIM
                RITSCH

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              LAWRENCE
                STONE MCGEE III, MD

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              MARC
                S. CAHN

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              MARIO
                CERNEKA

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              MACCOLLUM
                FAMILY TRUST

            	 
	 	
              By:
                Maxwell S. MacCollum, as Trustee

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              NORMAN
                A. DUDZIAK

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              RALPH
                V. KAPLAN, MD

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              VERONNE
                J. CRAWFORD TRUST

            	 
	 	
              By:
                Veronne J. Crawford, as Trustee

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              ALAN
                WALTER STIEHL

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              ALAN
                P. POWER

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              GEORGE
                KRAUSS

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              IROQUOIS
                MASTER FUND LTD.

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              CRANSHIRE
                CAPITAL, LP

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

    

    
      	 	
              OTHER
                BUYERS:

            	 
	 	 	 	 
	 	
              PROFESSIONAL
                OFFSHORE OPPORTUNITY FUND, LTD.

            	 
	 	
              By:
                Marc K. Swickle, as Manager

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	 	 
	 	 	
              Name:

            	 
	 	 	
              Title:

            	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      OF BUYERS

    

    

    
      	
              (1)

            	 	
              (2)

            	 	
              (3)

            	 	
              (4)

            	 	
              (5)

            	 	
              (6)

            
	 	 	 	 	 	 	 	 	 	 	 
	
              
                Buyer

              

            	 	
              
                Address
                  and Facsimile
                  Number

              

            	 	
              
                Aggregate
                  Principal Amount of
                  Notes

              

            	 	
              
                Number
                  of Warrant
                  Shares

              

            	 	
              
                Purchase
                  Price

              

            	 	
              
                Legal
                  Representative's Address and Facsimile
                  Number

              

            
	 	 	 	 	 	 	 	 	 	 	 
	
              Highbridge
                International 

            	 	
              c/o
                Highbridge Capital

            	 	
              $2,500,000

            	 	
              4,166,667

            	 	
              2,500,000

            	 	
              Schulte
                Roth & Zabel LLP

            
	LLC	 	
              Management,
                LLC

            	 	 	 	 	 	 	 	
              919
                Third Avenue

            
	 	 	
              9
                West 57th St, 27th Floor

            	 	 	 	 	 	 	 	
              New
                York, New York  10022

            
	 	 	
              New
                York, NY 10019

            	 	 	 	 	 	 	 	
              Attention:  Eleazer
                Klein, Esq.

            
	 	 	
              Attn:
                Ari J. Storch / Adam J. Chill

            	 	 	 	 	 	 	 	
              Facsimile:
                (212) 593-5955

            
	 	 	
              Tel:
                212-287-4720

            	 	 	 	 	 	 	 	
              Telephone:  (212)
                756-2376

            
	 	 	
              Fax:
                212-751-0755

            	 	 	 	 	 	 	 	 
	 	 	
              Residence:
                Cayman Islands

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Professional
                Offshore

            	 	
              1400
                Old Country Road, Suite 206

            	 	
              $1,000,000

            	 	
              1,666,667

            	 	
              $1,000,000

            	 	
              N/A

            
	
              Opportunity
                Fund, Ltd.

            	 	
              Westbury,
                New York 11590

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Cranshire
                Capital, LP

            	 	
              3100
                Dundee Rd., Suite 703

            	 	
              $250,000

            	 	
              416,667

            	 	
              $250,000

            	 	
              N/A

            
	 	 	
              Northbrook,
                IL 60062

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Iroquois
                Master Fund Ltd.

            	 	
              641
                Lexington Ave.

            	 	
              $250,000

            	 	
              416,667

            	 	
              $250,000

            	 	
              N/A

            
	 	 	
              26th
                Floor

            	 	 	 	 	 	 	 	 
	 	 	
              New
                York, New York 10022

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Adams,
Madeline Gayle

            	 	
              134
                Canteen

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Canyon
                Lake, TX 78133

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Cahn,
Marc S.

            	 	
              1496
                Tamarack Avenue

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Boulder,
                CO 80304

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Cerneka,
Mario

            	 	
              14432
                Adelta Drive

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Lamirada,
                CA 90638

            	 	 	 	 	 	 	 	 

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
              Cheeseman,
Valerie

            	 	
              330
                North 900 West #H

            	 	
              $23,000

            	 	
              38,333

            	 	
              $23,000

            	 	
              N/A

            
	 	 	
              Cedar
                City, UT 84720

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Crawford,
Veronne J.,

            	 	
              4800
                Wildcat Run

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	
              Trustee

            	 	
              Springfield,
                IL 62711

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Dudziak,
Norman A.,
Jr.

            	 	
              32
                Washington Road

            	 	
              $50,000

            	 	
              83,333

            	 	
              $50,000

            	 	
              N/A

            
	 	 	
              Berington,
                RI 02806

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Eigel,
Christopher J.

            	 	
              595
                Glendale Drive

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Glenview,
                IL 60025

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Groetsch,
Brian L.,
Sr.

            	 	
              Winter:
                980 Greenwood Court

            	 	
              $50,000

            	 	
              83,333

            	 	
              $50,000

            	 	
              N/A

            
	 	 	
              Sanibel,
                FL 33557

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Kaplan,
Ralph V.,
M.D.

            	 	
              139
                East Broadway

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              New
                York, NY 10002

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Krauss,
George

            	 	
              1214
                Howard #202

            	 	
              $250,000

            	 	
              416,667

            	 	
              $250,000

            	 	
              N/A

            
	 	 	
              Omaha,
                NE 68102

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Lau,
Grant

            	 	
              241
                East Hooper Avenue

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	Soda
              Springs, ID 83276	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              MacCollum,
Maxwell S.

            	 	
              126
                East Desert Park Lane

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Phoenix,
                AZ 85020

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              McGee,
LawrenceStone
III,
MD

            	 	
              108
                Pine Acres Drive

            	 	
              $62,500

            	 	
              104,167

            	 	
              $62,500

            	 	
              N/A

            
	 	 	
              Spartanburg,
                SC 29307

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Murray,
Alan John

            	 	
              3540
                Riverbend Road

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Birmingham,
                AL 35243

            	 	 	 	 	 	 	 	 

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
              Power,
Alan

            	 	
              1314
                Cabrillo Avenue

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Venice,
                CA 90291

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Ritsch,
James J.

            	 	
              2128
                High Point Drive

            	 	
              $50,000

            	 	
              83,333

            	 	
              $50,000

            	 	
              N/A

            
	 	 	
              Altoona,
                WI 54720

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Serikawa,
                Yoshihara

            	 	
              1470
                Ala Napunani Street

            	 	
              $50,000

            	 	
              83,333

            	 	
              $50,000

            	 	
              N/A

            
	 	 	
              Honolulu,
                HI 96818

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Spencer,
David R.

            	 	
              3810
                Grand Plantation Lane

            	 	
              $25,000

            	 	
              41,667

            	 	
              $25,000

            	 	
              N/A

            
	 	 	
              Missouri
                City, TX 77459

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Stiehl,
Walter A.

            	 	
              48
                Puritan Road

            	 	
              $12,500

            	 	
              20,833

            	 	
              $12,500

            	 	
              N/A

            
	 	 	
              Somerville,
                MA 02145

            	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	
              $4,823,000.00

            	 	
              8,038,337

            	 	
              $4,823,000.00

            	 	 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    EXHIBITS

    

    
      	
              Exhibit
                A

            	
              Form
                of Notes 

            

    

    
      	
              Exhibit
                B

            	
              Form
                of Warrant 

            

    

    
      	
              Exhibit
                C

            	
              Form
                of Registration Rights Agreement 

            

    

    
      	
              Exhibit
                D

            	
              Form
                of Irrevocable Transfer Agent Instructions

            

    

    
      	
              Exhibit
                E

            	
              Form
                of Opinion of Company’s Counsel 

            

    

    
      	
              Exhibit
                F

            	
              Form
                of Secretary's Certificate 

            

    

    
      	
              Exhibit
                G

            	
              Form
                of Officers Certificate 

            

    

    
      	
              Exhibit
                H

            	
              Form
                of Pledge and Security Agreement 

            

    

    
      	
              Exhibit
                I

            	
              Form
                of Collateral Agency Agreement 

            

    

    
      	
              Exhibit
                J

            	
              Form
                of Lock-Up Agreement 

            

    

    

    SCHEDULES

    

    
      	
              Schedule
                3(g)

            	
              Placement
                Agent's Fees 

            

    

    
      	
              Schedule
                3(r)

            	
              Equity
                capitalization

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00134-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00134-of-00352.parquet"}]]