Document:

EX10-1

__________

 

 

 

 

 

 

MINERAL PROPERTY ACQUISITION AGREEMENT

 

 

 

 

 

 

Among each of:

 

MAJOR VENTURES LLC, ELK CREEK CORPORATION, and 

BALBACH COLORADO INC

And:

SILICA RESOURCES CORPORATION

 

 

 

 

Silica Resources Corporation

1110 Hamilton Street, Suite 306, Vancouver, British Columbia, Canada V6B 2S2 

 __________

MINERAL PROPERTY ACQUISITION AGREEMENT

 

 

                       THIS MINERAL PROPERTY ACQUISITION AGREEMENT is made and dated for reference effective as of the 8th day of January, 2008 (the "Effective Date"), as fully executed on the 31st day of January, 2008.

 

AMONG EACH OF:

MAJOR VENTURES LLC, having an address for delivery and 

notice located at 7000 North Broadway, Ste. 2-204, Denver, 

Colorado, U.S.A., 80221

("Major Ventures");

OF THE FIRST PART

AND:

ELK CREEK CORPORATION, having an address for delivery 

and notice located at 33 Motherload Drive, Idaho City, Idaho, 

U.S.A., 83631

("Elk Creek Corp.");

OF THE SECOND PART

AND:

BALBACH COLORADO INC., having an address for delivery 

and notice located at 29294 Roan Drive, Evergreen, Colorado, 

U.S.A., 80439

("Balbach");

OF THE THIRD PART

(Major Ventures, Elk Creek Corp., and Balbach, being hereinafter 

singularly also referred to as a "Vendor" and collectively referred 

to as the "Vendors" as the context so requires);

AND:

SILICA RESOURCES CORPORATION, a company 

incorporated under the laws of the State of Nevada, U.S.A., and 

having an address for notice and delivery located at 1110 Hamilton 

Street, Suite 306, Vancouver, British Columbia, Canada V6B 2S2

(the "Purchaser");

OF THE FOURTH PART

(the Vendors and the Purchaser being hereinafter singularly also 

referred to as a "Party" and collectively referred to as the "Parties" 

as the context so requires).

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                       WHEREAS:

 

A.                    The Vendors , either directly or indirectly and through either of their wholly-owned and controlled holding companies, affiliates, associates or nominees, as the case may be, are the legal, beneficial and registered owners of certain mineral property interests which are located in each of the following jurisdictions (collectively, the "Property"):

(a)        the Elkhorn property located in Beaverhead County, Montana, and comprising approximately 1,777 acres;

(b)        the Ramey Creek property located in Custer County, Idaho, and comprising approximately 393 acres; and

(c)        the Roaring River property located in Elmore County, Idaho, and comprising approximately 2,707 acres;

and which mineral property interests comprising the Property are more particularly described in Schedule "A" which is attached hereto and which forms a material part hereof;

B.                    The Purchaser is a reporting company incorporated under the laws of the State of Nevada, U.S.A., is in the business of seeking, acquiring and developing mineral resource property interests of merit and has its common shares listed for trading on the NASD over-the-counter Bulletin Board;

C.                   As a consequence of various recent discussions and negotiations as between the Parties hereto the Vendors have agreed to grant an exclusive option to the Purchaser (the "Option") to acquire an undivided 100% legal, beneficial and registerable interest in and to each of the mineral property interests comprising the Property; and

D.                    The Parties hereto have agreed to enter into this agreement (the "Agreement") which formalizes and replaces, in its entirety, such recent discussions and negotiations, and which clarifies their respective duties and obligations in connection with the within granting by the Vendors to the Purchaser of the Option to acquire an undivided 100% legal, beneficial and registerable interest in and to the mineral property interests comprising the Property as a consequence thereof;

 

                       NOW THEREFORE THIS AGREEMENT WITNESSETH that, in consideration of the mutual covenants and provisos herein contained, THE PARTIES HERETO AGREE AS FOLLOWS:

 

Article 1

DEFINITIONS, SCHEDULES AND INTERPRETATION

1.1                    Definitions.   For the purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires, the following words and phrases shall have the following meanings:

(a)         "Affiliate" has the meaning ascribed to it in section "2.2" hereinbelow;

(b)         "Affiliate Share" has the meaning ascribed to it in section "2.2" hereinbelow;

(c)         "Affiliate Share Transfer" has the meaning ascribed to it in section "2.2" hereinbelow;

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(d)         "Agreement" means this Mineral Property Acquisition Agreement as entered into between the Parties hereto, together with any amendments thereto and any Schedules as attached thereto;

(e)         "Arbitration Act" means the British Columbia Commercial Arbitration Act, R.S.B.C. 1996, as amended, as set forth in Article "14" hereinbelow;

(f)         "Closing" has the meaning ascribed to it in section "6.1" hereinbelow and includes, without limitation, the closing of each of the transactions contemplated hereby which shall occur after the conditions precedent set out in Article "5" hereinbelow have been satisfied in their entirety;

(g)         "Closing Date" has the meaning ascribed to it in section "6.1" hereinbelow;

(h)         "Confidential Information" has the meaning ascribed to it in section "12.1" hereinbelow;

(i)         "Consultants" has the meaning ascribed to it in section "2.2" hereinbelow;

(j)         "Consulting Arrangements" has the meaning ascribed to it in section "2.2" hereinbelow;

(k)         "Defaulting Party" and "Non-Defaulting Party" have the meanings ascribed to them in section "15.1" hereinbelow;

(l)         "Disposing Party" has the meaning ascribed to it in section "8.3" hereinbelow;

(m)         "Effective Date" has the meaning ascribed to in on the front page of this Agreement;

(n)         "Escrow Agent" means Lang Michener LLP, Lawyers - Patent & Trade Mark Agents, counsel to the Purchaser, or such other mutually agreeable escrow agent as may be selected by the Parties hereto either prior to or after the Effective Date and who agrees to be bound by the terms and conditions of this Agreement;

(o)         "Holding" has the meaning ascribed to it in section "8.3" hereinbelow;

(p)         "Indemnified Parties" and "Indemnified Party" have the meanings ascribed to them in section "16.1" hereinbelow;

(q)         "mortgage" has the meaning ascribed to it in section "8.1" hereinbelow;

(r)         "Option" has the meaning ascribed to it in section "2.1" hereinbelow as effected in the manner as set forth in Article "2" hereinbelow;

(s)         "Option Period" has the meaning ascribed to it in section "2.1" hereinbelow;

(t)         "Party" or "Parties" means the Vendors and/or the Purchaser hereto, together with their respective successors and permitted assigns as the context so requires;

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 (u)         "person" or "persons" means an individual, corporation, partnership, party, trust, fund, association and any other organized group of persons and the personal or other legal representative of a person to whom the context can apply according to law;

(v)         "Property" has the meaning ascribed to it in recital "A." hereinabove; and which mineral property interests comprising the Property are particularly described in Schedule "A" which is attached hereto together with any other claim or interests of the Parties hereto which are incorporated into the Property by the terms of this Agreement;

(w)         "Property Documentation" means any and all technical records and other factual engineering data and information relating to the mineral property interests comprising the Property and including, without limitation, all plans, maps, agreements and records which are in the possession or control of any Party hereto;

(x)         "Property Rights" means all mineral licenses and all prioritized and protocoled applications for exploration licenses, permits, easements, rights-of-way, certificates, exclusive prospecting orders and other approvals obtained by either of the Parties either before or after the Effective Date of this Agreement and necessary for the exploration and development of any of the mineral property interests comprising the Property;

(y)         "Purchaser" means Silica Resources Corporation, a company incorporated pursuant to the laws of the State of Nevada, U.S.A., or any successor company, however formed, whether as a result of merger, amalgamation or other action;

(z)         "Regulatory Approval" means the acceptance for filing of the transactions contemplated by this Agreement by the Regulatory Authorities;

(aa)      "Regulatory Authorities" means such regulatory bodies and agencies who have jurisdiction over the affairs of any of the Parties hereto and including, without limitation, all Regulatory Authorities from whom any such authorization, approval or other action is required to be obtained or to be made in connection with the transactions contemplated by this Agreement;

(ab)      "Securities Act" means the United States Securities Act of 1933, as amended, together with any Rules and Regulations promulgated thereunder;

(ac)      "Subject Removal Date" has the meaning ascribed to it in section "5.1" hereinbelow;

(ad)      "subsidiary" means any company or companies of which more than 50% of the outstanding shares carrying votes at all times (provided that the ownership of such shares confers the right at all times to elect at least a majority of the board of directors of such company or companies) are for the time being owned by or held for a company and/or any other company in like relation to the company, and includes any company in like relation to the subsidiary;

(ae)      "Transfer Documents" has the meaning ascribed to it in section "7.2" hereinbelow; and

(af)      "Vendor" and "Vendors" means, individually and/or collectively, as the case may be, each of Major Ventures, Elk Creek Corp., and Balbach.

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1.2                    Schedule.   For the purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires, the following shall represent the Schedule which is attached to this Agreement and which forms a material part hereof:

	
Schedule

Schedule "A":
	
Description

Property.

1.3                    Interpretation.   For the purposes of this Agreement, except as otherwise expressly provided or unless the context otherwise requires:

(a)        the words "herein", "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, section or other subdivision of this Agreement;

(b)        the headings are for convenience only and do not form a part of this Agreement nor are they intended to interpret, define or limit the scope or extent of this or any provision of this Agreement;

(c)        any reference to an entity shall include and shall be deemed to be a reference to any entity that is a permitted successor to such entity; and

(d)        words in the singular include the plural and words in the masculine gender include the feminine and neuter genders, and vice versa.

 

Article 2

GRANT, MAINTENANCE, EXERCISE AND TERMINATION OF THE OPTION

2.1                    Grant of the Option.   Subject to the terms and conditions hereof and based upon the representations, warranties and covenants contained in Articles "3" and "4" hereinbelow and the prior satisfaction of the conditions precedent which are set forth in Article "5" hereinbelow, the Vendors hereby agrees to give and grant to the Purchaser the sole and exclusive right and option to acquire an undivided 100% legal, beneficial and registerable interest in and to the mineral property interests comprising the Property (again, the "Option") and, in order to maintain the Option in good standing and in full force and effect, the Purchaser hereby agrees to exercise the Option on or before the Closing Date (and which period in time from the Effective Date herein to the Closing Date is referred to as the "Option Period") for each of the considerations provided for in accordance with section "2.2" hereinbelow.

2.2                    Consideration for and maintenance of the Option.   In order to keep the right and Option granted to the Purchaser in respect of the Property in good standing and in force and effect during the Option Period the Purchaser shall be obligated to provide the following consideration to the Vendors in the following manner:

(a)        Affiliate Share Transfer:  in contemplation of each of the Vendor's various and potential continuing roles within the Company upon the exercise of the within Option and the proposed Closing of this Agreement, the Purchaser will be required to cause a certain existing founding shareholder of the Company (that being Jamie Oei; a current director of the Purchaser and herein the "Affiliate") to sell an aggregate of 2,000,000 restricted and control and issued and outstanding common shares from the holdings of such Affiliate in and to the Purchaser (each an "Affiliate Share") to the order and direction of the Vendors at a purchase price of U.S. $0.0001 per Affiliate Share:

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             Vendors

Elk Creek Corp.:

Balbach Colorado Inc.:

Major Ventures, LLC:

          Total:
	
Proposed allocation of Affiliate Shares

600,000 Affiliate Shares

1,000,000 Affiliate Shares

400,000 Affiliate Shares

2,000,000 Affiliate Shares;

(b)        Consulting Arrangements:  in contemplation of the Vendors and/or certain agents to the Vendors having and continuing to have certain roles within the Company upon the exercise of the within Option and the proposed Closing of this Agreement; and to take effective only upon the Closing herein; the Purchaser will use its reasonably commercial efforts to enter into industry standard forms of proposed consulting arrangements (collectively, the "Consulting Arrangements") with certain of the finally determined Vendors and/or agents to the Vendors (collectively, the "Consultants" herein) therein providing for, without limitation, the provision of certain consulting services to be provided by the Consultants to the Purchaser in connection with the exploration, development and expansion of the Property in consideration of, among other matters, the provision of the monthly payments by the Purchaser to each of the Consultants together with entitlement for the Consultants to participate in the Purchaser's then incentive stock option plan subject, at all times, to the final determination of the Board of Directors of the Purchaser in each such instance; and

(c)        Maintenance payments:  pay, or cause to be paid, to or on the Vendors' behalf as the Purchaser may determine, in the Purchaser's sole and absolute discretion, all underlying option, regulatory and governmental payments and assessment work required to keep the mineral property interests comprising the Property and any underlying option agreements respecting any of the mineral property interests comprising the Property in goodstanding during the Option Period of this Agreement.

2.3                    Resale restrictions and legending of Affiliate Share certificates.   The Vendors hereby acknowledge and agree that neither the Purchaser nor the Affiliate makes any representations as to any resale or other restriction affecting the Affiliate Shares and that it is presently contemplated that the Affiliate Shares will be transferred by the Affiliate to the Vendors in reliance upon the registration and prospectus exemptions contained in certain sections of the United States Securities Act of 1933 (the "Securities Act") which will impose a trading restriction in the United States on the Shares for a period of at least 12 months from the Closing Date.  In addition, the Vendors hereby also acknowledges and agrees that the within obligation of the Affiliate to transfer the Affiliate Shares pursuant to section "2.2" hereinabove will be subject to each of the Purchaser and the Affiliate being satisfied that an exemption from applicable registration and prospectus requirements is available under the Securities Act and all applicable securities laws in respect of each of the Vendors and the Affiliate Shares.

                       The Vendors hereby also acknowledge and understand that neither the sale of the Affiliate Shares which the Vendors are acquiring nor any of the Affiliate Shares themselves have been registered under the Securities Act or any state securities laws, and, furthermore, that the Affiliate Shares must be held indefinitely unless subsequently registered under the Securities Act or an exemption from such registration is available.  The Vendors also acknowledge and understand that the certificates representing the Affiliate Shares will be stamped with the following legend (or substantially equivalent language) restricting transfer in the following manner if such restriction is required by the Regulatory Authorities:

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"The transfer of the securities represented by this certificate is prohibited except in accordance with the provisions of Regulation S promulgated under the United States Securities Act of 1933, as amended (the "Act"), pursuant to registration under the Act or pursuant to an available exemption from registration.  In addition, hedging transactions involving such securities may not be conducted unless in compliance with the Act.".

or
"The securities represented by this certificate have not been registered under the United States Securities Act of 1933, as amended, or the laws of any state, and have been issued pursuant to an exemption from registration pertaining to such securities and pursuant to a representation by the security holder named hereon that said securities have been acquired for purposes of investment and not for purposes of distribution.  These securities may not be offered, sold, transferred, pledged or hypothecated in the absence of registration, or the availability of an exemption from such registration.  The stock transfer agent has been ordered to effectuate transfers only in accordance with the above instructions.";

and the Vendors hereby consent to the Purchaser making a notation on its records or giving instructions to any transfer agent of the Purchaser in order to implement the restrictions on transfer set forth and described hereinabove.

                       The Vendors also acknowledge and understand that:

(a)        the Affiliate Shares are restricted securities within the meaning of "Rule 144" promulgated under the Securities Act;

(b)        the exemption from registration under Rule 144 will not be available in any event for at least one year from the date of transfer of the Affiliate Shares to the Vendors, and even then will not be available unless (i) a public trading market then exists for the common stock of the Purchaser, (ii) adequate information concerning the Purchaser is then available to the public and (iii) other terms and conditions of Rule 144 are complied with; and

(c)        any sale of the Affiliate Shares may be made by the Vendors only in limited amounts in accordance with such terms and conditions.

2.4                    Standstill provisions.   In consideration of the Purchaser's within agreement to purchase the Property and to enter into the terms and conditions of this Agreement, the Vendors hereby undertakes for themselves, and for each of the Vendors' respective agents and advisors, that they will not until the earlier of the Closing Date or the termination of this Agreement approach or consider any other potential purchasers, or make, invite, entertain or accept any offer or proposal for the proposed sale of any mineral property interests comprising the Property or, for that matter, disclose any of the terms of this Agreement, without the Purchaser's prior written consent.  In this regard the Vendors hereby acknowledge that the foregoing restrictions are important to the business of the Purchaser and that a breach by the Vendors of any of the covenants herein contained would result in irreparable harm and significant damage to the Purchaser that would not be adequately compensated for by monetary award.  Accordingly, the Vendors hereby agree that, in the event of any such breach, in addition to being entitled as a matter of right to apply to a Court of competent equitable jurisdiction for relief by way of restraining order, injunction, decree or otherwise as may be appropriate to ensure compliance with the provisions hereof, the Vendors will also be liable to the Purchaser, as liquidated damages, for an amount equal to the amount received and earned by any such Party as a result of and with respect to any such breach.  The Vendors also acknowledge and agree that if any of the aforesaid restrictions, activities, obligations or periods are considered by a Court of competent jurisdiction as being unreasonable, they agree that said Court shall have authority to limit such restrictions, activities or periods as the Court deems proper in the circumstances.

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2.5                    Termination of the Option.   The Option shall terminate upon 90-calendar days' prior written notice being first being provided by the Vendors to the Purchaser:

(a)        if the Purchaser fails to arrange for the completion of the Affiliate Share Transfer by the Affiliate to the order and direction of the Vendors in accordance with paragraph "2.2(a)" hereinabove during the Option Period and prior to the time period and the Closing Date as specified in paragraph "2.2(a)" hereinabove; or

(b)        if the Purchaser fails to pay, or cause to be paid, to or on the Vendors' behalf as the Purchaser may determine, in the Purchaser's sole and absolute discretion, all underlying option, regulatory and governmental payments and assessment work required to keep the mineral property interests comprising the Property and any underlying option agreements respecting any of the mineral property interests comprising the Property in goodstanding in accordance with paragraph "2.2(c)" hereinabove.

2.6                    Termination by the Purchaser of the Option.   Prior to the exercise of the Option the Purchaser may terminate the Option by providing a notice of termination to the Vendors in writing of its desire to do so at least 30 calendar days prior to its decision to do so.  After such 30-calendar days' period the Purchaser shall have no further obligations, financial or otherwise, under this Agreement, except that the provisions of section "2.8" hereinbelow shall become immediately applicable to the Purchaser upon providing the said notice of termination to the Vendors.

2.7                    No interest in the Property upon termination of the Option.   If the Option is so terminated in accordance with either of sections "2.5" or "2.6" hereinabove the Purchaser shall have no interest in and to any of the mineral property interests comprising the Property, and any and all prior Affiliate Share Transfer transfers, Consulting Arrangements and maintenance payments made, or caused to be made, or incurred by the Purchaser to or on behalf of the Vendors or any of the mineral property interests comprising the Property under this Agreement, shall then be non-refundable by the Vendors to the Purchaser for which the Purchaser shall have no recourse, and the provisions of section "2.8" hereinbelow shall become immediately applicable to the Purchaser.

2.8                    Obligations on termination of the Option.   If the Option is terminated otherwise than upon the exercise thereof pursuant to this Article, then the Purchaser shall:

(a)        leave in good standing for a period of at least 60 calendar days from the termination of the Option those mineral property interests comprising the Property that are in good standing on the date thereof;

(b)        cause to be delivered to the Vendors the Transfer Documents and bills of sale in recordable form whereby the Purchaser's entire right, title and interest in and to the mineral property interests comprising the Property has been transferred to the Vendors free and clear of all liens or charges arising from the Purchaser's activities on the mineral property interests comprising the Property to the date thereof; and

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(c)        deliver at no cost to the Vendors within 30 calendar days of such termination copies of all reports, maps, assay results and other relevant technical data compiled by or in the possession of the Purchaser with respect to the mineral property interests comprising the Property and not theretofore already furnished to the Vendors.

2.9                    Deemed exercise of the Option.   At such time as the Purchaser has caused the completion of the Affiliate Share Transfer, entered into each of the Consulting Arrangements and made each of the required maintenance payments in accordance with section "2.2" hereinabove, within the Option Period and the time periods as specified in section "2.2", then the Option shall be deemed to have been exercised by the Purchaser, and the Purchaser shall have thereby, in accordance with the terms and conditions of this Agreement and without any further act required on its behalf, acquired an undivided 100% legal, beneficial and registerable interest in and to the mineral property interests comprising the Property.

 

Article 3

REPRESENTATIONS, WARRANTIES AND COVENANTS BY THE VENDORS

3.1                    General representations, warranties and covenants by the Vendors.   In order to induce the Purchaser to enter into and consummate this Agreement, the Vendors hereby, jointly and severally, represent to, warrant to and covenant with the Purchaser, with the intent that the Purchaser will rely thereon in entering into this Agreement and in concluding the transactions contemplated herein, that, to the best of the knowledge, information and belief of each of the Vendors, after having made due inquiry:

(a)        each of the Vendors and/or agents to the Vendors is and will be qualified to do business in those jurisdictions where it is necessary to fulfill each of the Vendor's obligations under this Agreement, and each of the Vendors has the full power and authority to enter into this Agreement and any agreement or instrument referred to or contemplated by this Agreement;

(b)        each of the Vendors has the requisite power, authority and capacity to fulfill the Vendor's obligations under this Agreement;

(c)        the execution and delivery of this Agreement and the agreements contemplated hereby have been duly authorized by all necessary action on each of the Vendor's part;

(d)        this Agreement constitutes a legal, valid and binding obligation of each of the Vendors enforceable against the Vendors in accordance with its terms, except as enforcement may be limited by laws of general application affecting the rights of creditors;

(e)        prior to the Subject Removal Date each of the Vendors will have obtained all authorizations, approvals, including Regulatory Approval, or waivers that may be necessary or desirable in connection with the transactions contemplated in this Agreement, and other actions by, and have made all filings with, any and all Regulatory Authorities from whom any such authorization, approval or other action is required to be obtained or to be made in connection with the transactions contemplated herein, and all such authorizations, approvals and other actions will be in full force and effect, and all such filings will have been accepted by each of the Vendors who will be in compliance with, and have not committed any breach of, any securities laws, regulations or policies of any Regulatory Authority to which either the Vendors or any of the mineral property interests comprising the Property may be subject;

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(f)        except for Regulatory Approval of this Agreement by the appropriate Regulatory Authorities, there are no other consents, approvals or conditions precedent to the performance of this Agreement which have not been obtained;

(g)        the Vendors are not in breach of any laws, ordinances, statutes, regulations, by-laws, orders or decrees to which the Vendors are subject or which apply to the Vendors;

(h)        no proceedings are pending for, and the Vendors are unaware of, any basis for the institution of any proceedings leading to the placing of any of the Vendors in bankruptcy or subject to any other laws governing the affairs of insolvent persons;

(i)        the Vendors have not received, nor have the Vendors requested or do the Vendors require to receive, any offering memorandum or similar document describing the business and affairs of the Purchaser in order to assist the Vendors in entering into this Agreement and in consummating the transactions contemplated herein;

(j)        except as otherwise provided for herein, the Vendors have not retained, employed or introduced any broker, finder or other person who would be entitled to a brokerage commission or finder's fee arising out of the transactions contemplated hereby;

(k)        the Vendors are not, nor until or at the Closing Date will the Vendors be, in breach of any provision or condition of, nor have the Vendors done or omitted to do anything that, with or without the giving of notice or lapse or both, would constitute a breach of any provision or condition of, or give rise to any right to terminate or cancel or accelerate the maturity of any payment under, any deed of trust, contract, certificate, consent, permit, license or other instrument to which either of the Vendors is a party, by which either of the Vendors is bound or from which any of the Vendors derives benefit, any judgment, decree, order, rule or regulation of any court or governmental authority to which any of the Vendors is subject, or any statute or regulation applicable to any of the Vendors, to an extent that, in the aggregate, has a material adverse affect on either of the Vendors or on any of the mineral property interests comprising the Property;

(l)        each Vendor will give to the Purchaser, within at least five calendar days prior to the Closing Date, by written notice, particulars of:

(i)        each occurrence within the Vendor' knowledge after the Effective Date of this Agreement that, if it had occurred before the Effective Date, would have been contrary to any of the Vendor's representations or warranties contained herein; and

(ii)       each occurrence or omission within the Vendor's knowledge after the Effective Date that constitutes a breach of any of the Vendor's covenants contained in this Agreement;

(m)        the making of this Agreement and the completion of the transactions contemplated hereby and the performance of and compliance with the terms hereof does not and will not:

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(i)        conflict with or result in a breach of or violate any of the terms, conditions or provisions of any law, judgment, order, injunction, decree, regulation or ruling of any court or governmental authority, domestic or foreign, to which any of the Vendors is subject, or constitute or result in a default under any agreement, contract or commitment to which any of the Vendors is a party;

(ii)       give to any party the right of termination, cancellation or acceleration in or with respect to any agreement, contract or commitment to which any of the Vendors is a party;

(iii)      give to any government or governmental authority, or any municipality or any subdivision thereof, including any governmental department, commission, bureau, board or administration agency, any right of termination, cancellation or suspension of, or constitute a breach of or result in a default under, any permit, license, control or authority issued to any of the Vendors which is necessary or desirable in connection with the conduct and operations of each Vendor's business and the ownership or leasing of each Vendor's business assets; or

(iv)       constitute a default by any of the Vendors, or any event which, with the giving of notice or lapse of time or both, might constitute an event of default, under any agreement, contract, indenture or other instrument relating to any indebtedness of any of the Vendors which would give any party to that agreement, contract, indenture or other instrument the right to accelerate the maturity for the payment of any amount payable under that agreement, contract, indenture or other instrument;

(n)        neither this Agreement nor any other document, certificate or statement furnished to the Purchaser by or on behalf of the Vendors in connection with the transactions contemplated hereby knowingly or negligently contains any untrue or incomplete statement of material fact or omits to state a material fact necessary in order to make the statements therein not misleading which would likely affect the decision of the Purchaser to enter into this Agreement; and

(o)        the Vendors are not aware of any fact or circumstance which has not been disclosed to the Purchaser which should be disclosed in order to prevent the representations, warranties and covenants contained in this section from being misleading or which would likely affect the decision of the Purchaser to enter into this Agreement.

3.2                    Representations, warranties and covenants by the Vendors respecting the Property.   In order to induce the Purchaser to enter into and consummate this Agreement, the Vendors hereby, jointly and severally, also represent to, warrant to and covenants with the Purchaser, with the intent that the Purchaser will also rely thereon in entering into this Agreement and in concluding the transactions contemplated herein, that, to the best of the knowledge, information and belief of each of the Vendors, after having made due inquiry:

(a)        the Vendors are the legal and beneficial owner of all of the mineral property interests comprising the Property; the particulars of which mineral property interests comprising the Property being more particularly described in Schedule "A" which is attached hereto;

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(b)        the Vendors are authorized to hold the right to explore and develop each of the mineral property interests comprising the Property and all Property Rights held by the Vendors in and to the mineral property interests comprising the Property;

(c)        the Vendors hold all of the mineral property interests comprising the Property free and clear of all liens, charges and claims of others;

(d)        no other person, firm or corporation has any written or oral agreement, option, understanding or commitment, or any right or privilege capable of becoming an agreement, for the purchase from the Vendors of any interest in and to any of the mineral property interests comprising the Property;

(e)        the mineral property interests comprising the Property have been duly and validly located and recorded in a good and minerlike manner pursuant to applicable mining laws;

(f)        all permits and licenses covering the mineral property interests comprising the Property have been duly and validly issued pursuant to applicable mining laws and are in good standing by the proper doing and filing of assessment work and the payment of all fees, taxes and rentals in accordance with the requirements of applicable mining laws and the performance of all other actions necessary in that regard;

(g)        where appropriate, the Vendors have insured the mineral property interests comprising the Property against loss or damage on a replacement cost basis;

(h)        all conditions on and relating to the mineral property interests comprising the Property and the operations conducted thereon by or on behalf of the Vendors are in compliance with all applicable laws, regulations or orders and including, without limitation, all laws relating to environmental matters, waste disposal and storage and reclamation;

(i)        there are no outstanding orders or directions relating to environmental matters requiring any work, repairs, construction or capital expenditures with respect to any of the mineral property interests comprising the Property and the conduct of the operations related thereto, nor have the Vendors received any notice of same;

(j)        there is no adverse claim or challenge against or to the ownership of or title to any of the mineral property interests comprising the Property or which may impede the development of any of the mineral interests comprising the Property, nor, to the best of the knowledge, information and belief of each of the Vendors, after having made due inquiry, is there any basis for any potential claim or challenge, and, to the best of the knowledge, information and belief of each of the Vendors, after having made due inquiry, no person has any royalty, net profits or other interests whatsoever in any production from any of the mineral property interests comprising the Property;

(k)        there are no actions, suits, proceedings or investigations (whether or not purportedly against or on behalf of the Vendors), pending or threatened, which may affect, without limitation, the rights of any of the Vendors to transfer any interest in and to the mineral property interests comprising the Property to the Purchaser at law or in equity, or before or by any federal, state, provincial, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, and, without limitation, there are no claims or potential claims under any relevant family relations legislation or other equivalent legislation affecting any of the mineral property interests comprising the Property.  In addition, the Vendors are not now aware of any existing ground on which any such action, suit or proceeding might be commenced with any reasonable likelihood of success;

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(l)        the Vendors will deliver in the normal course to the Purchaser all Property Documentation in the Vendors' possession or control relating to the mineral property interests comprising the Property together with copies of all permits, permit applications and applications for exploration and exploitation rights respecting any of the mineral property interests comprising the Property;

(m)        the Vendors are not aware of any fact or circumstance which has not been disclosed to the Purchaser which should be disclosed in order to prevent the representations and warranties contained in this section from being misleading or which would likely affect the decision of the Purchaser to enter into this Agreement.

3.3                    Continuity of the representations, warranties and covenants by the Vendors.   The representations, warranties and covenants by the Vendors contained in this Article "3", or in any certificates or documents delivered pursuant to the provisions of this Agreement or in connection with the transactions contemplated hereby, will be true at and as of the Closing Date as though such representations, warranties and covenants were made at and as of such time.  Notwithstanding any investigations or inquiries made by the Purchaser or by the Purchaser's professional advisors prior to the Closing Date, or the waiver of any condition by the Purchaser, the representations, warranties and covenants of the Vendors contained in this Article "3" shall survive the Closing Date and shall continue in full force and effect for a period of one year from the Closing Date; provided, however, that the Vendors shall not be responsible for the breach of any representation, warranty or covenant of the Vendors contained herein caused by any act or omission of the Purchaser prior to the Effective Date hereof of which the Vendors were unaware or as a result of any action taken by the Purchaser after the Effective Date.  

 

Article 4

WARRANTIES, REPRESENTATIONS AND COVENANTS BY THE PURCHASER

4.1                    Warranties, representations and covenants by the Purchaser.   In order to induce the Vendors to enter into and consummate this Agreement, the Purchaser hereby warrants to, represents to and covenants with each of the Vendors, with the intent that the Vendors will rely thereon in entering into this Agreement and in concluding the transactions contemplated herein, that, to the best of the knowledge, information and belief of the Purchaser, after having made due inquiry:

(a)        the Purchaser is a corporation duly incorporated under the laws of the State of Nevada, U.S.A., is validly existing and is in good standing with respect to all statutory filings required by the Nevada Revised Statutes;

(b)        the Purchaser is qualified to do business in those jurisdictions where it is necessary to fulfill the Purchaser's obligations under this Agreement, and the Purchaser has the full power and authority to enter into this Agreement and any agreement or instrument referred to or contemplated by this Agreement;

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(c)        the execution and delivery of this Agreement and the agreements contemplated hereby has been duly authorized by all necessary corporate action on the Purchaser's part;

(d)        prior to the Subject Removal Date the Purchaser will have obtained all authorizations, approvals, including Regulatory Approval, or waivers that may be necessary or desirable in connection with the transactions contemplated in this Agreement, and other actions by, and have made all filings with, any and all Regulatory Authorities from whom any such authorization, approval or other action is required to be obtained or to be made in connection with the transactions contemplated herein, and all such authorizations, approvals and other actions will be in full force and effect, and all such filings will have been accepted by the Purchaser who will be in compliance with, and have not committed any breach of, any securities laws, regulations or policies of any Regulatory Authority to which the Purchaser may be subject;

(e)        except for Regulatory Approval of this Agreement by the appropriate Regulatory Authorities, there are no other consents, approvals or conditions precedent to the performance of this Agreement which have not been obtained;

(f)        this Agreement constitutes a legal, valid and binding obligation of the Purchaser enforceable against the Purchaser in accordance with its terms, except as enforcement may be limited by laws of general application affecting the rights of creditors;

(g)        no proceedings are pending for, and the Purchaser is unaware of, any basis for the institution of any proceedings leading to the dissolution or winding up of the Purchaser or the placing of the Purchaser in bankruptcy or subject to any other laws governing the affairs of insolvent companies;

(h)        there is no basis for and there are no actions, suits, judgments, investigations or proceedings outstanding or pending or, to the best of the knowledge, information and belief of the Purchaser, after making due inquiry, threatened against or affecting the Purchaser at law or in equity or before or by any federal, state, municipal or other governmental department, commission, board, bureau or agency;

(i)        the Purchaser is not in breach of any laws, ordinances, statutes, regulations, by-laws, orders or decrees to which the Purchaser is subject or which apply to the Purchaser;

(j)        the Purchaser will save the Vendors harmless in respect of all claims, liabilities and expenses arising out of the Purchaser's activities on any of the mineral property interests comprising the Property;

(k)        the Purchaser will do all work on the Property in a good and minerlike fashion and in accordance with all applicable laws, regulations, orders and ordinances of any governmental authority;

(l)        the Purchaser is not in breach of any provision or condition of, nor has the Purchaser done or omitted anything that, with or without the giving of notice or lapse or both, would constitute a breach of any provision or condition of, or give rise to any right to terminate or cancel or accelerate the maturity of any payment under, any deed of trust, contract, certificate, consent, permit, license or other instrument to which the Purchaser is a party, by which the Purchaser is bound or from which the Purchaser derives benefit, any judgment, decree, order, rule or regulation of any court or governmental authority to which the Purchaser is subject, or any statute or regulation applicable to the Purchaser, to an extent that, in the aggregate, has a material adverse affect on the Purchaser;

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(m)        the Purchaser will give to the Vendors, within at least five calendar days prior to the Closing Date (as hereinafter defined), by written notice, particulars of:

(i)        each occurrence within the Purchaser's knowledge after the Effective Date of this Agreement that, if it had occurred before the Effective Date, would have been contrary to any of the Purchaser's representations or warranties contained herein; and

(ii)       each occurrence or omission within the Purchaser's knowledge after the Effective Date that constitutes a breach of any of the Purchaser's covenants contained in this Agreement;

(n)        the making of this Agreement and the completion of the transactions contemplated hereby and the performance of and compliance with the terms hereof does not and will not:

(i)        conflict with or result in a breach of or violate any of the terms, conditions or provisions of the incorporation documents of the Purchaser;

(ii)       conflict with or result in a breach of or violate any of the terms, conditions or provisions of any law, judgment, order, injunction, decree, regulation or ruling of any court or governmental authority, domestic or foreign, to which the Purchaser is subject, or constitute or result in a default under any agreement, contract or commitment to which the Purchaser is a party;

(iii)      give to any party the right of termination, cancellation or acceleration in or with respect to any agreement, contract or commitment to which the Purchaser is a party;

(iv)       give to any government or governmental authority, or any municipality or any subdivision thereof, including any governmental department, commission, bureau, board or administration agency, any right of termination, cancellation or suspension of, or constitute a breach of or result in a default under, any permit, license, control or authority issued to the Purchaser which is necessary or desirable in connection with the conduct and operations of the Purchaser's business and the ownership or leasing of the Purchaser's business assets; or

(v)        constitute a default by the Purchaser or any event which, with the giving of notice or lapse of time or both, might constitute an event of default, under any agreement, contract, indenture or other instrument relating to any indebtedness of the Purchaser which would give any party to that agreement, contract, indenture or other instrument the right to accelerate the maturity for the payment of any amount payable under that agreement, contract, indenture or other instrument;

(o)        neither this Agreement nor any other document, certificate or statement furnished to the Vendors by or on behalf of the Purchaser in connection with the transactions contemplated hereby knowingly or negligently contains any untrue or incomplete statement of material fact or omits to state a material fact necessary in order to make the statements therein not misleading; and

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(p)        the Purchaser is not aware of any fact or circumstance which has not been disclosed to the Vendors which should be disclosed in order to prevent the representations, warranties and covenants contained in this section from being misleading or which would likely affect the decision of the Vendors to enter into this Agreement.

4.2                    Continuity of the representations, warranties and covenants by the Purchaser.   The representations, warranties and covenants of the Purchaser contained in this Article "4", or in any certificates or documents delivered pursuant to the provisions of this Agreement or in connection with the transactions contemplated hereby, will be true at and as of the Closing Date as though such representations, warranties and covenants were made at and as of such time.  Notwithstanding any investigations or inquiries made by the Vendors or by the Vendors' professional advisors prior to the Closing Date, or the waiver of any condition by the Vendors, the representations, warranties and covenants of the Purchaser contained in this Article "4" shall survive the Closing Date and shall continue in full force and effect for a period of one year from the Closing Date; provided, however, that the Purchaser shall not be responsible for the breach of any representation, warranty or covenant of the Purchaser contained herein caused by any act or omission of the Vendors prior to the Effective Date hereof of which the Purchaser was unaware or as a result of any action taken by the Vendors after the Effective Date.  In the event that any of the said representations, warranties or covenants are found by a court of competent jurisdiction to be incorrect and such incorrectness results in any loss or damage sustained directly or indirectly by the Vendors, then the Purchaser will pay the amount of such loss or damage to the Vendors within 30 calendar days of receiving notice of judgment therefor; provided, however, that the Vendors will not be entitled to make any claim unless the loss or damage suffered may exceed the amount of U.S. $1,000.

 

Article 5

CONDITIONS PRECEDENT TO CLOSING

5.1                    Parties' conditions precedent prior to the Closing Date.  All of the rights, duties and obligations of each of the Parties hereto under this Agreement are subject to the following conditions precedent for the exclusive benefit of each of the Parties fulfilled in all material aspects in the reasonable opinion of each of the Parties or to be waived by each or any of the Parties, as the case may be, as soon as possible after the Effective Date, however, unless specifically indicated as otherwise, not later than 120 calendar days after the Effective Date and not later than 10 calendar days prior to the Closing Date (such date being the "Subject Removal Date" herein):

(a)        receipt of all necessary approvals, including Regulatory Approval, from all Regulatory Authorities having jurisdiction over the Parties hereto and the transactions contemplated by this Agreement, to the terms and conditions of and the transactions contemplated by this Agreement; and

(b)        if required, shareholders of the Purchaser passing an ordinary resolution or, where required, a special resolution, approving the terms and conditions of this Agreement and all of the transactions contemplated hereby or, in the alternative, shareholders of the Purchaser holding 100% of the issued shares of the Purchaser providing written consent resolutions evidencing their approval to the terms and conditions of this Agreement and all of the transactions contemplated hereby.

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5.2                    Parties' waiver of conditions precedent.   The conditions precedent set forth in section "5.1" hereinabove are for the exclusive benefit of each of the Parties hereto and may be waived by each or any of the Parties in writing and in whole or in part at any time, however, not later than the Subject Removal Date.

5.3                    The Vendors' conditions precedent.   The rights, duties and obligations of the Vendors under this Agreement are also subject to the following conditions precedent for the exclusive benefit of the Vendors fulfilled in all material aspects in the reasonable opinion of the Vendors or to be waived by the Vendors as soon as possible after the Effective Date, however, unless specifically indicated as otherwise, not later than 10 calendar days prior to the Subject Removal Date:

(a)        the representations, warranties and covenants of the Purchaser contained herein shall be true and correct as of and on the Subject Removal Date;

(b)        the Purchaser shall have complied with all warranties, representations, covenants and agreements herein agreed to be performed or caused to be performed by the Purchaser on or before the Subject Removal Date;

(c)        the Purchaser will have obtained all authorizations, approvals, including Regulatory Approval, or waivers that may be necessary or desirable in connection with the transactions contemplated in this Agreement, and other actions by, and have made all filings with, any and all Regulatory Authorities from whom any such authorization, approval or other action is required to be obtained or to be made in connection with the transactions contemplated herein, and all such authorizations, approvals and other actions will be in full force and effect, and all such filings will have been accepted by the Purchaser who will be in compliance with, and have not committed any breach of, any securities laws, regulations or policies of any Regulatory Authority to which the Purchaser may be subject;

(d)        all matters which, in the opinion of counsel for the Vendors, are material in connection with the transactions contemplated by this Agreement shall be subject to the favourable opinion of such counsel, and all relevant records and information shall be supplied to such counsel for that purpose;

(e)        no material loss or destruction of or damage to the Purchaser shall have occurred since the Effective Date;

(f)        no action or proceeding at law or in equity shall be pending or threatened by any person, company, firm, governmental authority, regulatory body or agency to enjoin or prohibit:

(i)        the purchase or transfer of any interest in and to the mineral property interests comprising the Property as contemplated by this Agreement or the right of the Vendors to dispose of any interest in and to any of the mineral property interests comprising the Property; or

(ii)       the right of the Purchaser to conduct the Purchaser's operations and carry on, in the normal course, the Purchaser's business and operations as the Purchaser has carried on in the past;

(g)        the delivery to the Vendors by the Purchaser, on a confidential basis, of the following documentation and information:

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(i)        a copy of all material contracts, agreements, reports and title information of any nature respecting the Purchaser and each of its subsidiaries, if any; and

(ii)       details of any lawsuits, claims or potential claims relating to the Purchaser or to any of the Purchaser's subsidiaries, if any, of which the Purchaser is aware and the Vendors is unaware;

(h)        the Purchaser will, for a period of not less than five calendar days during the period commencing on the Effective Date and continuing until not later than 30 calendar days prior to the Subject Removal Date, during normal business hours:

(i)        make available for inspection by the solicitors, auditors and representatives of the Vendors, at such location as is appropriate, all of the Purchaser's and each of the Purchaser's subsidiaries', if any, books, records, contracts, documents, correspondence and other written materials, and afford such persons every reasonable opportunity to make copies thereof and take extracts therefrom at the sole cost of the Vendors; provided such persons do not unduly interfere in the operations of the Purchaser or any of the Purchaser's subsidiaries, if any;

(ii)       authorize and permit such persons at the risk and the sole cost of the Vendors, and only if such persons do not unduly interfere in the operations of the Purchaser and each of the Purchaser's subsidiaries, if any, to attend at all of their places of business and operations to observe the conduct of their businesses and operations, inspect their properties and assets and make physical counts of their inventories, shipments and deliveries; and

(iii)      require the Purchaser's and each of the Purchaser's subsidiaries', if any, management personnel to respond to all reasonable inquiries concerning the Purchaser's and each of the Purchaser's subsidiaries', if any, business assets or the conduct of their businesses relating to their liabilities and obligations; and

(i)        the completion by the Vendors and by the Vendors' professional advisors of a thorough due diligence and operations review of the businesses and operations of the Purchaser and each of the Purchaser's subsidiaries, if any, to the sole and absolute satisfaction of the Vendors.

5.4                    The Vendors' waiver of conditions precedent.   The conditions precedent set forth in section "5.3" hereinabove are for the exclusive benefit of the Vendors and may be waived by the Vendors in writing and in whole or in part at any time after the Effective Date, however, unless specifically indicated as otherwise, not later than 10 calendar days prior to the Subject Removal Date.

5.5                    The Purchaser's conditions precedent.   The rights, duties and obligations of the Purchaser under this Agreement are also subject to the following conditions precedent for the exclusive benefit of the Purchaser fulfilled in all material aspects in the reasonable opinion of the Purchaser or to be waived by the Purchaser as soon as possible after the Effective Date, however, unless specifically indicated as otherwise, not later than 10 calendar days prior to the Subject Removal Date:

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(a)        the representations, warranties and covenants of the Vendors contained herein shall be true and correct as of and on the Subject Removal Date;

(b)        the Vendors shall have complied with all warranties, representations, covenants and agreements herein agreed to be performed or caused to be performed by the Vendors on or before the Subject Removal Date;

(c)        the Vendors will have obtained all authorizations, approvals, including Regulatory Approval, or waivers that may be necessary or desirable in connection with the transactions contemplated in this Agreement, and other actions by, and have made all filings with, any and all Regulatory Authorities from whom any such authorization, approval or other action is required to be obtained or to be made in connection with the transactions contemplated herein, and all such authorizations, approvals and other actions will be in full force and effect, and all such filings will have been accepted by the Vendors who will be in compliance with, and have not committed any breach of, any securities laws, regulations or policies of any Regulatory Authority to which the Vendors may be subject;

(d)        all matters which, in the opinion of counsel for the Purchaser, are material in connection with the transactions contemplated by this Agreement shall be subject to the favourable opinion of such counsel, and all relevant records and information shall be supplied to such counsel for that purpose;

(e)        no material loss or destruction of or damage to any of the mineral property interests comprising the Property shall have occurred since the Effective Date;

(f)        no action or proceeding at law or in equity shall be pending or threatened by any person, company, firm, governmental authority, regulatory body or agency to enjoin or prohibit:

(i)        the sale or transfer of any interest in and to the mineral property interests comprising the Property as contemplated by this Agreement or the right of the Purchaser to acquire any interest in and to any of the mineral property interests comprising the Property; or

(ii)       the right of the Purchaser to conduct the Purchaser's operations and carry on, in the normal course, the Purchaser's business and operations as the Purchaser has carried on in the past;

(g)        the delivery to the Purchaser by the Vendors, on a confidential basis, of all Property Documentation and including, without limitation,:

(i)        a copy of all material contracts, agreements, reports and title information of any nature respecting any of the mineral interests comprising the Property; and

(ii)       details of any lawsuits, claims or potential claims relating to any of the mineral interests comprising the Property of which the Vendors are aware and the Purchaser is unaware;

(h)        certification by the Vendors to the Purchaser in a form satisfactory to the Purchaser, acting reasonably, dated as at the date of delivery, to the effect that:

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(i)        the Vendors are the legal and beneficial owner of all of the mineral property interests comprising the Property prior to the completion of the transactions contemplated by this Agreement;

(ii)       the Vendor holds the right to explore and develop each of the mineral property interests comprising the Property and all Property Rights held by the Vendors in and to the mineral property interests comprising the Property;

(iii)      the Vendors hold all of the mineral property interests comprising the Property free and clear of all liens, charges and claims of others;

(iv)       the mineral property interests comprising the Property have been duly and validly located and recorded in a good and minerlike manner pursuant to all applicable laws and are in good standing;

(v)        based on actual knowledge and belief, the Vendors know of no adverse claim or challenge against or to the ownership of or title to any of the mineral property interests comprising the Property or which may impede their development, and, based on actual knowledge and belief, such counsel is not aware of any basis for any potential claim or challenge, and, based on actual knowledge and belief, such counsel knows of no outstanding agreements or options to acquire or purchase any portion of any of the mineral property interests comprising the Property, and no person has any royalty, net profits or other interest whatsoever in any production from any of the mineral property interests comprising the Property;

(vi)       based on actual knowledge and belief, such counsel knows of no claims, judgments, actions, suits, litigation, proceedings or investigations, actual, pending or threatened, against any of the Vendors which might materially affect any of the mineral property interests comprising the Property or which could result in any material liability to either of the Vendors or to any of the mineral property interests comprising the Property; and

(vii)      as to all other legal matters of a like nature pertaining to the Vendors and the mineral property interests comprising the Property and to the transactions contemplated hereby as the Purchaser or the Purchaser's counsel may reasonably require; and

(i)        the completion by the Purchaser and by the Purchaser's professional advisors of a thorough due diligence and operations review of the mineral property interests comprising the Property, of the business and operations of the Vendors and of the transferability of the mineral property interests comprising the Property as contemplated by this Agreement, to the sole and absolute satisfaction of the Purchaser.

5.6                    Purchaser's waiver of conditions precedent.   The conditions precedent set forth in section "5.5" hereinabove are for the exclusive benefit of the Purchaser and may be waived by the Purchaser in writing and in whole or in part at any after the Effective Date, however, unless specifically indicated as otherwise, not later than 10 calendar days prior to the Subject Removal Date.

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Article 6

CLOSING AND EVENTS OF CLOSING

6.1                    Closing and Closing Date.   Subject to the prior and due and complete exercise of by the Purchaser of the Option in accordance with Article "2" hereinabove, the closing (the "Closing") of the within purchase and delivery of an undivided 100% interest in and to the mineral property interests comprising the Property, as contemplated in the manner as set forth in Article "2" hereinabove, together with all of the transactions contemplated by this Agreement, shall occur on the day which is five business days following the due and complete exercise of the Option by the Purchaser in accordance with Article "2" hereinabove (the "Closing Date"), or on such earlier or later Closing Date as may be agreed to in advance and in writing by each of the Parties hereto, and will be closed at the offices of Lang Michener LLP, Lawyers - Patent & Trade Mark Agents, located at 1500 Royal Centre, 1055 West Georgia Street, Vancouver, British Columbia, Canada, V6E 4N7, counsel for the Purchaser herein, at 2:00 p.m. (Vancouver time) on the Closing Date.

6.2                    Latest Closing Date.   If the Closing Date in respect of the due and complete exercise of the Option by the Purchaser has not occurred within 90 calendar days from the Effective Date then this Agreement will be terminated and unenforceable unless the Parties hereto agree in writing to grant an extension of such Closing Date.

6.3                    Documents to be delivered by the Vendors prior to the Closing Date.   Subject to the prior and due and complete exercise of by the Purchaser of the Option in accordance with Article "2" hereinabove, and not later than five calendar days prior to the Closing Date and in addition to the documentation which is required by the agreements and conditions precedent which are set forth in Articles "2" and "5" hereinabove, the Vendors shall also execute and deliver, or cause to be delivered, to the Escrow Agent all such other documents, resolutions and instruments as may be necessary, in the opinion of counsel for the Purchaser, acting reasonably, to complete all of the transactions contemplated by this Agreement and including, without limitation, the necessary transfer of an undivided 100% legal, beneficial and registerable interest in and to each of the mineral property interests comprising the Property to the Purchaser (or, at the sole and absolute discretion of the Purchaser, to such other entity or subsidiary as may be determined by the Purchaser prior to the Closing Date) free and clear of all liens, charges and encumbrances, and in particular including, but not being limited to, the following materials:

(a)        all documentation as may be necessary and as may be required by the counsel for the Purchaser, acting reasonably, to ensure that an undivided 100% legal, beneficial and registerable interest in and to each of the mineral property interests comprising the Property have been duly transferred, assigned and are registerable in the name of and for the benefit of the Purchaser (or, at the sole and absolute discretion of the Purchaser, to such other entity or subsidiary as may be determined by the Purchaser) under all applicable laws;

(b)        all necessary deeds, conveyances, bills of sale, assurances, transfers, assignments and consents, including all necessary consents and approvals, and any other documents necessary or reasonably required to effectively transfer an undivided 100% legal, beneficial and registerable interest in and to each of the mineral property interests comprising the Property to the Purchaser (or, at the sole and absolute discretion of the Purchaser, to such other entity or subsidiary as may be determined by the Purchaser) with good and marketable title, free and clear of all mortgages, liens, charges, pledges, claims, security interests or encumbrances whatsoever;

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(c)        all necessary consents and approvals in writing to the completion of the transactions contemplated herein and including, without limitation, Regulatory Approval from all Regulatory Authorities having jurisdiction over any of the Vendors or any of the mineral property interests comprising the Property;

(d)        confirmation by the Vendors that as at the Closing Date, certification that the representations, warranties, covenants and agreements of each of the Vendors contained in this Agreement are true and correct in all respects as of the Closing Date as if made by the Vendors on the Closing Date including;

(i)        the Vendors are the legal and beneficial owner of all of the mineral property interests comprising the Property prior to the completion of the transactions contemplated by this Agreement;

(ii)       the Vendors hold the right to explore and develop each of the mineral property interests comprising the Property and all Property Rights held by the Vendors in and to the mineral property interests comprising the Property;

(iii)      the Vendors hold all of the mineral property interests comprising the Property free and clear of all liens, charges and claims of others;

(iv)       the mineral property interests comprising the Property have been duly and validly located and recorded in a good and minerlike manner pursuant to all applicable laws and are in good standing;

(v)        all necessary steps have been taken by the Vendors to permit the transfer of an undivided 100% legal, beneficial and registerable interest in and to each of the mineral property interests comprising the Property to the Purchaser (or, at the sole and absolute discretion of the Purchaser, to such other entity or subsidiary as may be determined by the Purchaser) with good and marketable title, free and clear of all mortgages, liens, charges, pledges, claims, security interests or encumbrances whatsoever;

(vi)       based on actual knowledge and belief, such counsel knows of no adverse claim or challenge against or to the ownership of or title to any of the mineral property interests comprising the Property or which may impede their development, and, based on actual knowledge and belief, such counsel is not aware of any basis for any potential claim or challenge, and, based on actual knowledge and belief, such counsel knows of no outstanding agreements or options to acquire or purchase any portion of any of the mineral property interests comprising the Property, and no person has any royalty, net profits or other interest whatsoever in any production from any of the mineral property interests comprising the Property;

(vii)       based on actual knowledge and belief, such counsel knows of no claims, judgments, actions, suits, litigation, proceedings or investigations, actual, pending or threatened, against any of the Vendors which might materially affect any of the mineral property interests comprising the Property or which could result in any material liability to either of the Vendors or to any of the mineral property interests comprising the Property; and

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(viii)      as to all other legal matters of a like nature pertaining to the Vendors and the mineral property interests comprising the Property and to the transactions contemplated hereby as the Purchaser or the Purchaser's counsel may reasonably require; and

(e)        any remaining Property Documentation; and

(f)        all such other documents and instruments as the Purchaser and the Purchaser's counsel may reasonably require.

6.4                    Documents to be delivered by the Purchaser prior to the Closing Date.   Subject to the prior and due and complete exercise of by the Purchaser of the Option in accordance with Article "2" hereinabove, and not later than five calendar days prior to the Closing Date and in addition to the documentation which is required by the agreements and conditions precedent which are set forth in Articles "2" and "5" hereinabove, the Purchaser shall also execute and deliver, or cause to be delivered, to the Escrow Agent all such other documents, resolutions and instruments as are necessary, in the opinion of counsel for the Vendors, acting reasonably, to complete all of the transactions contemplated by this Agreement and including, without limitation, each of the Affiliate Share Transfer, Consulting Arrangements and maintenance payments hereunder, and effectively accepting the transfer to the Purchaser (or, at the sole and absolute discretion of the Purchaser, to such other entity or subsidiary as may be determined by the Purchaser prior to the Closing Date) of an undivided 100% legal, beneficial and registerable interest in and to the mineral property interests comprising the Property free and clear of all liens, charges and encumbrances, and in particular including, but not being limited to, the following materials:

(a)        a Closing agenda;

(b)        if required, a certified copy of an ordinary resolution or, where required, a special resolution, of the shareholders of the Purchaser approving the terms and conditions of this Agreement and all of the transactions contemplated hereby or, in the alternative, shareholders of the Purchaser holding 100% of the issued shares of the Purchaser providing written consent resolutions evidencing their approval to the terms and conditions of this Agreement and all of the transactions contemplated hereby;

(c)        a certified copy of the resolutions of the directors of the Purchaser providing for the approval of the terms and conditions of this Agreement and all of the transactions contemplated hereby;

(d)        all necessary consents and approvals in writing to the completion of the transactions contemplated herein and including, without limitation, Regulatory Approval from all Regulatory Authorities having jurisdiction over the Purchaser;

(e)        a certificate of an officer of the Purchaser, dated as at the Closing Date, acceptable in form to counsel for the Vendors, acting reasonably, certifying that the representations, warranties, covenants and agreements of the Purchaser contained in this Agreement are true and correct in all respects as of the Closing Date as if made by the Purchaser on the Closing Date;

(f)        written evidence and confirmation, to the sole and absolute satisfaction of the Vendors, acting reasonably, of the prior due and complete exercise of the Option by the Purchaser and in particular including, without limitation, the completion of the Affiliate Share Transfer and any required Consulting Arrangements together with the payment of all Property maintenance payments prior to Closing; and

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(g)        all such other documents and instruments as the Vendors and the Vendors' counsel may reasonably require.

 

Article 7

APPOINTMENT OF ESCROW AGENT AND TRANSFER DOCUMENTS

7.1                    Appointment of Escrow Agent.  The Parties hereto hereby acknowledge and appoint the Escrow Agent as escrow agent herein.

7.2                    Escrow of Transfer Documents.   Subject to and in accordance with the terms and conditions hereof and the requirements of Articles "2", "5" and "6" hereinabove, and without in any manner limiting the obligations of each of the Parties hereto as contained therein and hereinabove, it is hereby acknowledged and confirmed by the Parties hereto that each of the Parties will execute, deliver, or cause to be delivered, all such documentation as may be required by the requirements of Articles "2", "5" and "6" hereinabove (herein, collectively, the "Transfer Documents") and deposit the same with the Escrow Agent, or with such other mutually agreeable escrow agent, together with a copy of this Agreement, there to be held in escrow for release by the Escrow Agent to the Parties in accordance with the strict terms and provisions of Articles "2" and "6" hereinabove.

7.3                    Resignation of Escrow Agent.   The Escrow Agent may resign from its duties and responsibilities if it gives each of the Parties hereto three calendar days' written notice in advance.   Upon receipt of notice of the Escrow Agent's intention to resign the Parties shall, within three calendar days, select a replacement escrow agent and jointly advise the Escrow Agent in writing to deliver the Transfer Documents to the replacement escrow agent.   If the Parties fail to agree on a replacement escrow agent within three calendar days of such notice, the replacement escrow agent shall be selected by a Judge of the Supreme Court of the Province of British Columbia upon application by any Party hereto.   The Escrow Agent shall continue to be bound by this Agreement until the replacement escrow agent has been selected and the Escrow Agent receives and complies with the joint instructions of the Parties to deliver the Transfer Documents to the replacement escrow agent.   The Parties agree to enter into an escrow agreement substantially in the same form of this Agreement with the replacement escrow agent.

7.4                    Instructions to Escrow Agent.   Instructions given to the Escrow Agent pursuant to this Agreement shall be given by duly authorized signatories of the respective Parties hereto.

7.5                    No other duties or obligations.   The Escrow Agent shall have no duties or obligations other than those specifically set forth in this Article.

7.6                    No obligation to take legal action.   The Escrow Agent shall not be obligated to take any legal action hereunder which might, in its judgment, involve any expense or liability unless it shall have been furnished with a reasonable indemnity by all of the Parties hereto together with such other third parties as the Escrow Agent may require in its sole and absolute discretion.

7.7                    Not bound to any other agreements.   The Escrow Agent is not bound in any way by any other contract or agreement between the Parties hereto whether or not it has knowledge thereof or of its terms and conditions and its only duty, liability and responsibility shall be to hold and deal with the Transfer Documents as herein directed.

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7.8                    Notice.   The Escrow Agent shall be entitled to assume that any notice and evidence received by it pursuant to these instructions from anyone has been duly executed by the Party by whom it purports to have been signed and that the text of any notice and evidence is accurate and the truth.  The Escrow Agent shall not be obliged to inquire into the sufficiency or authority of the text or any signatures appearing on such notice or evidence.

7.9                    Indemnity.   The Parties hereto, jointly and severally, covenant and agree to indemnify the Escrow Agent and to hold it harmless against any loss, liability or expense incurred, without negligence or bad faith on its part, arising out of or in connection with the administration of its duties hereunder and including, without limitation, the costs and expenses of defending itself against any claim or liability arising therefrom.

7.10                  Not required to take any action.   In the event of any disagreement between any of the Parties hereto to these instructions or between them or either or any of them and any other person resulting in adverse claims or demands being made in connection with the Transfer Documents, or in the event that the Escrow Agent should take action hereunder, it may, at its option, refuse to comply with any claims or demands on it, or refuse to take any other action hereunder, so long as such disagreement continues or such doubt exists and, in any such event, it shall not be or become liable in any way or to any person for its failure or refusal to act and it shall be entitled to continue so to refrain from acting until:

(a)        the rights of all Parties shall have been fully and finally adjudicated by a court of competent jurisdiction; or

(b)        all differences shall have been adjusted and all doubt resolved by agreement among all of the interested persons and it shall have been notified thereof in writing signed by all such persons.

 

Article 8

POWER TO CHARGE AND ASSIGNMENT AND RIGHT OF FIRST REFUSAL

8.1                    Power to charge.   At any time prior to the exercise of the Option by the Purchaser the Purchaser may grant mortgages, charges or liens (each of which is herein called a "mortgage") of and upon the interest of the Purchaser in and to any of the mineral property interests comprising the Property, upon any mill or other fixed property located thereon and on any or all of the tangible personal property located on or used in connection with any of the mineral property interests comprising the Property, to secure only the financing of development of any of the mineral property interests comprising the Property; provided that, unless otherwise agreed to by the Vendors, it shall be a term of each mortgage that the mortgagee or any person acquiring title to any mineral property interest comprising the Property, or to any mill or other fixed property or tangible personal property located on or used in connection with any mineral property interest comprising the Property upon enforcement of the mortgage, shall hold the same subject to the rights of the Vendors hereunder as if the mortgagee or any such person had executed this Agreement as party of the first part.

8.2                    Assignment.   Save and except as otherwise provided for hereinabove and in this Article, no Party may sell, assign, pledge, mortgage or otherwise encumber all or any part of its interest herein or to any of the mineral property interests comprising the Property without the prior written consent of the other Party hereto; provided, however, that any Party hereto may at anytime, and at its sole and absolute discretion and without the prior approval of the other Party, assign and transfer its interest herein or to any of the mineral property interests comprising the Property to any wholly-owned subsidiary subject, at all times, to the requirement that any such subsidiary remain wholly owned by the Party hereto failing which any such interest must be immediately transferred back to such Party hereto; and, provided further, that any transfer of all or any part of a Party's interest herein or to any of the mineral property interests comprising the Property to its wholly owned subsidiary shall be accompanied by the written agreement of any such subsidiary to assume the obligations of such Party hereunder and to be bound by the terms and conditions hereof.

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8.3                    Right of first refusal.   At any time both prior to and after the exercise of the Option by the Purchaser in accordance with the terms of this Agreement each of the Vendors and the Purchaser (hereinafter each called the "Disposing Party") hereby grants to the other Party a right of first refusal to acquire all or any portion of any interest herein or to any of the mineral property interests comprising the Property which the Disposing Party desires to dispose of (hereinafter called, collectively, the "Holding").   If a Disposing Party receives a bona fide offer to purchase from, or where a sale is solicited by the Disposing Party, then upon settling the proposed terms thereof with a third party for the purchase or sale of the Holding, the Disposing Party shall forthwith offer to sell the Holding to the other Party.  The offer to sell to the non-Disposing Party (or Parties as the case may be) shall be on the same terms and conditions and of equivalent dollar value as those contained in the offer to the third party; provided, however, that should the Parties fail to agree upon a determination of the equivalent dollar value for any such offer, such equivalent dollar value shall be determined finally by arbitration under the provisions of Article "14" hereinbelow.   The other Party shall be entitled to elect, by notice to the Disposing Party within 30 calendar days from the date of receipt of the offer to sell, to acquire the Holding, on the same terms and conditions as those set forth in the offer to the third party.  If the other Party does not exercise its right to acquire the Holding as aforesaid, the Disposing Party may, for a period of 60 calendar days following the last date upon which the other Party could have made the election hereinabove, dispose of the Holding, but only on the same terms and conditions as set forth in that offer.   Any transfer of all or any part of a Disposing Party's interest herein or to any of the mineral property interests comprising the Property shall be accompanied by the written agreement of any such transferee to assume the obligations of such Disposing Party hereunder and to be bound by the terms and conditions hereof.

 

Article 9

REGISTRATION, PARTITION AND TENANCY

9.1                    Registration.   Upon the request of the Purchaser the Vendors shall assist the Purchaser to record this Agreement with the appropriate mining recorders and, when required, the Vendors shall further provide the Purchaser with such recordable documents as the Purchaser and its counsel shall require to record its due interest in respect of the mineral property interests comprising the Property.

9.2                    Partition.   No Party owning a partitionable interest in any to any of the mineral property interests comprising the Property shall, during the term of this Agreement, exercise any right to apply for any partition of any portion of the mineral property interests comprising the Property or for the sale thereof in lieu of partition.

9.3                    Tenancy.   Any interests of the Purchaser and Vendors in and to any of the mineral property interests comprising the Property shall be held as tenants in common and not as joint tenants.

 

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Article 10

DUE DILIGENCE INVESTIGATION

10.1                  Due Diligence.   Each of the Parties hereto shall forthwith conduct such further due diligence examination of the other Parties hereto as it deems appropriate.

10.2                  Confidentiality.   Each Party may in a reasonable manner carry out such investigations and due diligence as to the other Parties hereto, at all times subject to the confidentiality provisions of Articles "12" and "13" hereinbelow, as each Party deems necessary.  In that regard the Parties agree that each shall have full and complete access to, if and where applicable, the other Parties' respective books, records, financial statements and other documents, articles of incorporation, by-laws, minutes of Board of Directors' meetings and its committees, investment agreements, material contracts and as well as such other documents and materials as the Parties hereto, or their respective solicitors, may deem reasonable and necessary to conduct an adequate due diligence investigation of each Party and its respective operations and financial condition prior to the Closing.

 

Article 11

NON-DISCLOSURE

11.1                  Non-disclosure.   Subject to the provisions of section "11.3" hereinbelow, the Parties hereto, for themselves and, if and where applicable, their officers, directors, shareholders, consultants, employees and agents, agree that they each will not disseminate or disclose, or knowingly allow, permit or cause others to disseminate or disclose to third parties who are not subject to express or implied covenants of confidentiality, without the other Parties' express written consent, either: (i) the fact or existence of this Agreement or discussions and/or negotiations between them involving, inter alia, possible business transactions; (ii) the possible substance or content of those discussions; (iii) the possible terms and conditions of any proposed transaction; (iv) any statements or representations (whether verbal or written) made by either Party in the course of or in connection with those discussions; or (v) any written material generated by or on behalf of any Party and such contacts, other than such disclosure as may be required under applicable securities legislation or regulations, pursuant to any order of a court or on a "need to know" basis to each of the Parties' respective professional advisors.

11.2                  Documentation.   Any document or written material generated by either Party hereto in the course of, or in connection with, the due diligence investigations conducted pursuant to this Agreement shall be marked "Confidential" and shall be treated by each Party as a trade secret of the other Parties.  Upon termination of this Agreement prior to Closing all copies of any and all documents obtained by any Party from any other Party herein, whether or not marked "Confidential", shall be returned to the other Parties forthwith.

11.3                  Public announcements.   Notwithstanding the provisions of this Article, the Parties hereto agree to make such public announcements of this Agreement promptly upon its execution in accordance with the requirements of applicable securities legislation and regulations.

 

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Article 12

PROPRIETARY INFORMATION

12.1                  Confidential Information.   Each Party hereto acknowledges that any and all information which a Party may obtain from, or have disclosed to it, about the other Parties constitutes valuable trade secrets and proprietary confidential information of the other Parties (collectively, the "Confidential Information").  No such Confidential Information shall be published by any Party without the prior written consent of the other Parties hereto; however, such consent in respect of the reporting of factual data shall not be unreasonably withheld and shall not be withheld in respect of information required to be publicly disclosed pursuant to applicable securities or corporation laws.   Furthermore, each Party hereto undertakes not to disclose the Confidential Information to any third party without the prior written approval of the other Parties hereto and to ensure that any third party to which the Confidential Information is disclosed shall execute an agreement and undertaking on the same terms as contained herein.

12.2                  Impact of breach of confidentiality.   The Parties hereto acknowledge and agree that the Confidential Information is important to the respective businesses of each of the Parties and that, in the event of disclosure of the Confidential Information, except as authorized hereunder, the damage to each of the Parties hereto, or to either of them, may be irreparable.  For the purposes of the foregoing sections the Parties recognize and hereby agree that a breach by any of the Parties of any of the covenants therein contained would result in irreparable harm and significant damage to each of the other Parties that would not be adequately compensated for by monetary award.  Accordingly, the Parties agree that in the event of any such breach, in addition to being entitled as a matter of right to apply to a court of competent equitable jurisdiction for relief by way of restraining order, injunction, decree or otherwise as may be appropriate to ensure compliance with the provisions hereof, any such Party will also be liable to the other Parties, as liquidated damages, for an amount equal to the amount received and earned by such Party as a result of and with respect to any such breach.  The Parties also acknowledge and agree that if any of the aforesaid restrictions, activities, obligations or periods are considered by a court of competent jurisdiction as being unreasonable, the Parties agree that said court shall have authority to limit such restrictions, activities or periods as the court deems proper in the circumstances.   In addition, the Parties further acknowledge and agree that all restrictions or obligations in this Agreement are necessary and fundamental to the protection of the respective businesses of each of the Parties and are reasonable and valid, and all defenses to the strict enforcement thereof by either of the Parties are hereby waived by the other Parties.

 

Article 13

FORCE MAJEURE

13.1                  Events.   If any Party hereto is at any time prevented or delayed in complying with any provisions of this Agreement by reason of strikes, walk-outs, labour shortages, power shortages, fires, wars, acts of God, earthquakes, storms, floods, explosions, accidents, protests or demonstrations by environmental lobbyists or native rights groups, delays in transportation, breakdown of machinery, inability to obtain necessary materials in the open market, unavailability of equipment, governmental regulations restricting normal operations, shipping delays or any other reason or reasons beyond the control of that Party, then the time limited for the performance by that Party of its respective obligations hereunder shall be extended by a period of time equal in length to the period of each such prevention or delay.

13.2                  Notice.   A Party shall, within seven calendar days, give notice to the other Parties of each event of force majeure under section "13.1" hereinabove and, upon cessation of such event, shall furnish the other Parties with notice of that event together with particulars of the number of days by which the obligations of that Party hereunder have been extended by virtue of such event of force majeure and all preceding events of force majeure.

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Article 14

ARBITRATION

14.1                  Matters for Arbitration.   The Parties hereto agree that all questions or matters in dispute with respect to this Agreement shall be submitted to arbitration pursuant to the terms hereof.

14.2                  Notice.   It shall be a condition precedent to the right of any Party to submit any matter to arbitration pursuant to the provisions hereof that any Party intending to refer any matter to arbitration shall have given not less than 10-calendar days' prior written notice of its intention to do so to the other Party together with particulars of the matter in dispute.  On the expiration of such 10 calendar days the Party who gave such notice may proceed to refer the dispute to arbitration as provided in section "14.3" hereinbelow.

14.3                  Appointments.   The Party desiring arbitration shall appoint one arbitrator, and shall notify the other Party of such appointment, and the other Party shall, within 10 calendar days after receiving such notice, appoint an arbitrator, and the two arbitrators so named, before proceeding to act, shall, within 10 calendar days of the appointment of the last appointed arbitrator, unanimously agree on the appointment of a third arbitrator, to act with them and be chairperson of the arbitration herein provided for.  If the other Party shall fail to appoint an arbitrator within 10 calendar days after receiving notice of the appointment of the first arbitrator, or if the two arbitrators appointed by the Parties shall be unable to agree on the appointment of the chairperson, the chairperson shall be appointed under the provisions of the Arbitration Act.  Except as specifically otherwise provided in this section, the arbitration herein provided for shall be conducted in accordance with such Arbitration Act.  The chairperson, or in the case where only one arbitrator is appointed, the single arbitrator, shall fix a time and place in Vancouver, British Columbia, Canada, for the purpose of hearing the evidence and representations of the Parties, and such arbitrator shall preside over the arbitration and determine all questions of procedure not provided for under such Arbitration Act or this section.  After hearing any evidence and representations that the Parties may submit, the single arbitrator, or the arbitrators, as the case may be, shall make an award and reduce the same to writing, and deliver one copy thereof to each of the Parties.  The expense of the arbitration shall be paid as specified in the award.

14.4                  Award.   The Parties hereto agree that the award of a majority of the arbitrators, or in the case of a single arbitrator, of such arbitrator, shall be final and binding upon each of them.

 

Article 15

DEFAULT AND TERMINATION

15.1                  Default.   The Parties hereto agree that if any Party hereto is in default with respect to any of the provisions of this Agreement (herein called the "Defaulting Party"), the non-defaulting Party (herein called the "Non-Defaulting Party") shall give notice to the Defaulting Party designating such default, and within 10 calendar days after its receipt of such notice, the Defaulting Party shall either:

(a)        cure such default, or commence proceedings to cure such default and prosecute the same to completion without undue delay; or

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(b)        give the Non-Defaulting Party notice that it denies that such default has occurred and that it is submitting the question to arbitration as herein provided.

15.2                  Arbitration.   If arbitration is sought a Party shall not be deemed in default until the matter shall have been determined finally by appropriate arbitration under the provisions of Article "14" hereinabove.

15.3                  Curing the Default.   If:

(a)        the default is not so cured or the Defaulting Party does not commence or diligently proceed to cure the default; or

(b)        arbitration is not so sought; or

(c)        the Defaulting Party is found in arbitration proceedings to be in default, and fails to cure it within five calendar days after the rendering of the arbitration award,

the Non-Defaulting Party may, by written notice given to the Defaulting Party at any time while the default continues, terminate the interest of the Defaulting Party in and to this Agreement.

15.4                  Termination.   In addition to the foregoing it is hereby acknowledged and agreed by the Parties hereto that this Agreement will be immediately terminated in the event that:

(a)        the Option is terminated in accordance with Article "2" hereinabove;

(b)        either of the Parties hereto has either not satisfied or waived each of their respective conditions precedent prior to the Subject Removal Date in accordance with the provisions of Article "5" hereinabove;

(c)        either of the Parties hereto has failed to deliver, or caused to be delivered, any of their respective materials required to be delivered in accordance with Articles "5" and "6" hereinabove prior to each of the Subject Removal Date and the Closing Date in accordance with the provisions of Articles "5" and "6" hereinabove;

(d)        either of the Parties hereto has not provided a satisfactory report on its respective due diligence as contemplated in accordance with Articles "5" and "6" hereinabove;

(e)        the Closing Date in respect of the due and complete exercise of the Option by the Purchaser has not occurred within 90 calendar days from the Effective Date; or

(f)        by agreement in writing by each of the Parties hereto;

and in such event this Agreement will be terminated and be of no further force and effect other than the obligations under Articles "2", "11" and "12" hereinabove.

 

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Article 16

INDEMNIFICATION AND LEGAL PROCEEDINGS

16.1                  Indemnification.   Each Party hereto agrees to indemnify and save the other Parties, their respective affiliates and their respective directors, officers, employees and agents (collectively, the "Indemnified Parties" and, individually, as an "Indemnified Party") harmless from and against any and all losses, claims, actions, suits, proceedings, damages, liabilities or expenses of whatsoever nature or kind, including any investigation expenses incurred by any Indemnified Party, to which an Indemnified Party may become subject by reason of the terms and conditions of this Agreement.  This indemnity will not apply in respect of an Indemnified Party in the event and to the extent that a court of competent jurisdiction in a final judgment shall determine that the Indemnified Party was grossly negligent or guilty of willful misconduct.  The Parties hereto agree to waive any right they might have of first requiring the Indemnified Party to proceed against or enforce any other right, power, remedy, security or claim payment from any other person before claiming this indemnity.  In case any action is brought against an Indemnified Party in respect of which indemnity may be sought against any Party hereto, the Indemnified Party will give the affected Party prompt written notice of any such action of which the Indemnified Party has knowledge and the affected Party will undertake the investigation and defense thereof on behalf of the Indemnified Party, including the prompt employment of counsel acceptable to the Indemnified Parties affected and the payment of all expenses.  Failure by the Indemnified Party to so notify shall not relieve the affected Party of its obligation of indemnification hereunder unless (and only to the extent that) such failure results in a forfeiture by the affected Party of any substantive rights or defenses.  No admission of liability and no settlement of any action shall be made without the affected Party's consent and the consent of the Indemnified Parties affected, such consent not to be unreasonable withheld.  Notwithstanding that the affected Party will undertake the investigation and defense of any action, an Indemnified Party will have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel will be at the expense of the Indemnified Party unless:

(a)        employment of such counsel has been authorized by the affected Party;

(b)        the affected Party has not assumed the defense of the action within a reasonable period of time after receiving notice of the action;

(c)        the named parties to any such action include that the affected Party and the Indemnified Party shall have been advised by counsel that there may be a conflict of interest between the affected Party and the Indemnified Party; or

(d)        there are one or more legal defenses available to the Indemnified Party which are different from or in addition to those available to the affected Party.

                       If for any reason other than the gross negligence or bad faith of the Indemnified Parties (or any of them) being the primary cause of the loss claim, damage, liability, cost or expense, the foregoing indemnification is unavailable to the Indemnified Parties (or any of them) or insufficient to hold them harmless, the affected Party shall contribute to the amount paid or payable by the Indemnified Parties as a result of any and all such losses, claim, damages or liabilities in such proportion as is appropriate to reflect not only the relative benefits received by the affected Party on the one hand and the Indemnified Parties on the other, but also the relative fault of the Parties and other equitable considerations which may be relevant.  Notwithstanding the foregoing, the affected Party shall in any event contribute to the amount paid or payable by the Indemnified Parties as a result of the loss, claim, damage, liability, cost or expense (other than a loss, claim, damage, liability, cost or expenses, the primary cause of which is the gross negligence or bad faith of the Indemnified Parties or any of them), any excess of such amount over the amount of the fees actually received by the Indemnified Parties hereunder.

16.2                  Legal proceedings.   The Parties hereto agrees that if:

(a)        any legal proceedings shall be brought against either of them by any governmental commission or regulatory authority or any stock exchange; or

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(b)        an entity having regulatory authority, either domestic or foreign, shall investigate either of them;

and personnel of either Party shall be required to testify in connection therewith or shall be required to respond to procedures designed to discover information regarding the terms and conditions of this Agreement, such Party shall have the right to employ its own counsel in connection therewith and the affected Party will pay to such Party a per diem amount for their services based on its normal hourly or daily rate together with such disbursements and reasonable out-of-pocket expenses as may be incurred in connection therewith, including fees and disbursements of counsel incurred in connection with such testimony or participation.

 

Article 17

NOTICE

17.1                  Notice.   Each notice, demand or other communication required or permitted to be given under this Agreement shall be in writing and shall be sent by prepaid registered mail deposited in a post office addressed to the Party entitled to receive the same, or delivered to such Party, at the address for such Party specified above.  The date of receipt of such notice, demand or other communication shall be the date of delivery thereof if delivered or, if given by registered mail as aforesaid, shall be deemed conclusively to be the third calendar day after the same shall have been so mailed, except in the case of interruption of postal services for any reason whatsoever, in which case the date of receipt shall be the date on which the notice, demand or other communication is actually received by the addressee.

17.2                  Change of Address.   Either Party may at any time and from time to time notify the other Parties in writing of a change of address and the new address to which notice shall be given to it thereafter until further change.

 

Article 18

GENERAL PROVISIONS

18.1                  Entire agreement.   This Agreement constitutes the entire agreement to date between the Parties hereto and supersedes every previous agreement, communication, expectation, negotiation, representation or understanding, whether oral or written, express or implied, statutory or otherwise, between the Parties hereto with respect to the subject matter of this Agreement.

18.2                  Enurement.   This Agreement will enure to the benefit of and will be binding upon the Parties hereto and their respective heirs, executors, administrators and assigns.

18.3                  Time of the essence.   Time will be of the essence of this Agreement.

18.4                  Representation and costs.   It is hereby acknowledged by each of the Parties hereto that Lang Michener LLP, Lawyers - Patent & Trade Mark Agents, act solely for the Purchaser.   In addition, it is hereby further acknowledged and agreed by the Parties hereto that Lang Michener LLP, and certain or all of its principal owners or associates, from time to time, may have both an economic or shareholding interest in and to the Purchaser and/or a fiduciary duty to the same arising from either a directorship, officership or similar relationship arising out of the request of the Purchaser for certain of such persons to act in a similar capacity while acting for the Purchaser as counsel.  Correspondingly, and even where, as a result of this Agreement, the consent of each Party hereto to the role and capacity of Lang Michener LLP, and its principal owners and associates, as the case may be, is deemed to have been received, where any conflict or perceived conflict may arise, or be seen to arise, as a result of any such capacity or representation, each Party hereto acknowledges and agrees to, once more, obtain independent legal advice in respect of any such conflict or perceived conflict and, consequent thereon, Lang Michener LLP, together with any such principal owners or associates, as the case may be, shall be at liberty at any time to resign any such position if it or any Party hereto is in any way affected or uncomfortable with any such capacity or representation.  

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18.5                  Applicable law.   The situs of this Agreement is Vancouver, British Columbia, Canada, and for all purposes this Agreement will be governed exclusively by and construed and enforced in accordance with the laws and Courts prevailing in the Province of British Columbia, Canada.

18.6                  Further assurances.   The Parties hereto hereby, jointly and severally, covenant and agree to forthwith, upon request, execute and deliver, or cause to be executed and delivered, such further and other deeds, documents, assurances and instructions as may be required by the Parties hereto or their respective counsel in order to carry out the true nature and intent of this Agreement.

18.7                  Currency.   Unless otherwise stipulated, all payments required to be made pursuant to the provisions of this Agreement and all money amount references contained herein are in lawful currency of the United States.

18.8                  Severability and construction.   Each Article, section, paragraph, term and provision of this Agreement, and any portion thereof, shall be considered severable, and if, for any reason, any portion of this Agreement is determined to be invalid, contrary to or in conflict with any applicable present or future law, rule or regulation in a final unappealable ruling issued by any court, agency or tribunal with valid jurisdiction in a proceeding to any of the Parties hereto is a party, that ruling shall not impair the operation of, or have any other effect upon, such other portions of this Agreement as may remain otherwise intelligible (all of which shall remain binding on the Parties and continue to be given full force and agreement as of the date upon which the ruling becomes final).

18.9                  Captions.   The captions, section numbers and Article numbers appearing in this Agreement are inserted for convenience of reference only and shall in no way define, limit, construe or describe the scope or intent of this Agreement nor in any way affect this Agreement.

18.10                Counterparts.   This Agreement may be signed by the Parties hereto in as many counterparts as may be necessary and, if required, by facsimile, each of which so signed being deemed to be an original, and such counterparts together shall constitute one and the same instrument and notwithstanding the date of execution will be deemed to bear the Effective Date as set forth on the front page of this Agreement.  

18.11                No partnership or agency.   The Parties hereto have not created a partnership and nothing contained in this Agreement shall in any manner whatsoever constitute any Party the partner, agent or legal representative of any other Party, nor create any fiduciary relationship between them for any purpose whatsoever.  No Party shall have any authority to act for, or to assume any obligations or responsibility on behalf of, any other party except as may be, from time to time, agreed upon in writing between the Parties or as otherwise expressly provided.

18.12                Consents and waivers.   No consent or waiver expressed or implied by either Party hereto in respect of any breach or default by any other Party in the performance by such other of its obligations hereunder shall:

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(a)        be valid unless it is in writing and stated to be a consent or waiver pursuant to this section;

(b)        be relied upon as a consent to or waiver of any other breach or default of the same or any other obligation;

(c)        constitute a general waiver under this Agreement; or

(d)        eliminate or modify the need for a specific consent or waiver pursuant to this section in any other or subsequent instance.

 

                       IN WITNESS WHEREOF each of the Parties hereto have hereunto set their respective hands and seals in the presence of their duly authorized signatories effective as of the Effective Date as set forth in the front page of this Agreement.

 

	
The CORPORATE SEAL of

MAJOR VENTURES LLC,

a Vendor herein,

was hereunto affixed in the presence of:

 "Major Seery"                                 

Authorized Signatory

	
)

)

)

)

)

)

)
	

(C/S)

	
The CORPORATE SEAL of

ELK CREEK CORPORATION,

a Vendor herein,

was hereunto affixed in the presence of:

"Grant Hawk"                                 

Authorized Signatory

	
)

)

)

)

)

)

)
	

(C/S)

	
The CORPORATE SEAL of

BALBACH COLORADO INC.,

a Vendor herein,

was hereunto affixed in the presence of:

 "Joseph E. Worthington"               

Authorized Signatory

	
)

)

)

)

)

)

)
	

(C/S)

	
The CORPORATE SEAL of

SILICA RESOURCES CORPORATION,

the Purchaser herein,

was hereunto affixed in the presence of:

"Paul D. Brock"                             

Authorized Signatory

	
)

)

)

)

)

)

)
	

(C/S)

 

__________

 

Schedule A

 

 

                       This is Schedule "A" to that certain Mineral Property Acquisition Agreement as entered among each of the Vendors (Major Ventures LLC, Elk Creek Corporation, and Balbach Colorado Inc. and the Purchaser (Silica Resources Corporation).

 

Property

                       The following represents a general description of the various Property interests for which a more particular description follows:

(a)       the Elkhorn property located in Beaverhead County, Montana, and comprising approximately 1,777 acres;

(b)       the Ramey Creek property located in Custer County, Idaho, and comprising approximately 393 acres; and

(c)       the Roaring River property located in Elmore County, Idaho, and comprising approximately 2,707 acres.

Elkhorn property, Beaverhead County, Montana

Comprised of 86 staked MO Lode mining claims on approximately 1777 acres within the  Elkhorn Mining District. There are some patented mining claims within the area of interest and negotiations are underway to acquire these. The claims are located in the Pioneer Mountains, on federal lands administered by the U.S. Department of Agriculture as the Beaverhead-Deerlodge National Forest, surveyed sections 12, 13, 14, 15, 22, 23 and 24, Township 4 South, Range 12 West, Montana Principle Meridian.

The Elkhorn property has good access on unimproved Forest Service Roads off of the recently completed Pioneer Mountains Scenic Byway, approximately ten miles from Polaris and thirty miles from Wise River. The nearest full service town is Dillon Montana, the county seat, which has a hospital and numerous services. Butte is sixty five miles from the claims, and as a major mining center, hosts several businesses focused on drilling and construction services. Helena and Missoula, both approximately 150 miles away, are the closest airports serving commercial flights from major western hubs.

The geology of the Elkhorn area is dominated by Cretaceous and Tertiary granitic rocks of the Pioneer Batholith. This Batholith, of calc-alkaline composition is dated at 68-75 m.y. It lies east of the Idaho Batholith and within the Cordilleran fold and thrust belt. The area of interest is underlain primarily by granodiorite, tonalite and quartz diorite. The Comet fault trends north, connecting with the 4th of July fault, which continues into the sedimentary rocks of the northern Pioneers. The Comet fault is believed to be significant in the sub parallel vein mineralization of the Elkhorn area, as is the 4th of July fault in the Cannivan Gulch deposit to the north being explored by United Bolero. Historically silver, lead and zinc were recovered from ores mined from quartz veins in the upper fault block to the west of the Comet fault. The lower block exhibits significant molybdenite mineralization previously observed  by Senior Consulting Geologist Joseph Worthington in the presently inaccessible 1000 level Elkhorn Mine adit.

- 2 -

Current exploration efforts involve surface mapping and sampling of previously mined areas. Geochemical sampling indicates low molybdenum values in the veins of the upper block. Samples of sediment washed out of the 1000 level adit yield higher molybdenum values. Efforts this winter will focus on preparing and filing plans with the local Forest Service District Ranger for permitting of surface drilling operations to begin next summer. Four drill holes will target the molybdenum mineralization noted in the 1000 level adit to ascertain distribution and depth of mineralization. Surface sampling will also continue to identify future drill sites in order to establish the full parameters of the mineralized zone.

Ramey Creek property, Custer County, Idaho

19 Bright lode mining claims on approximately 393 acres in the Salmon-Challis National Forest, Custer County, Idaho. Located in unsurveyed sections 22, 23, 26, 27, 34 and 35, Township 12 North, Range 15 East of the Boise Principal Meridian on federal lands administered by the US Department of Agriculture. Ramey Creek is five air miles from the Thompson Creek molybdenum mine. The area of interest lies four miles up Ramey Creek Canyon from the Yankee Fork River, at the intersection of a minor tributary unofficially named Ross Creek. 

The property is accessed off of Idaho State Highway 75, via Yankee Fork Road at Sunbeam, then two miles up the unimproved Ramey Creek Road. Ross Creek lies two miles further up by foot trail. The nearest town with services is Stanley, primarily a seasonal tourist town, but Stanley does have an airfield suitable for small planes and helicopters. Challis, the county seat is 40 miles distant by State and U.S. highways. Twin Falls, approximately 120 miles to the south, has an airport with commercial airline service. The Yankee Fork area has electrical service suitable for mining operations, due to the proximity of the now closed Hecla mining operation on Jordan Creek.

The geology of the Ramey Creek area includes Paleozioc sedimentary units, and Tertiary volcanic and plutonic rocks. The principal target of interest is the Pennsylvanian Wood River quartzite, which overlies a Copper Basin argillic siltstone. A porphyry sill separates these units from the Challis volcanics in the area of interest. The volcanic rocks comprise the peaks in succession from lower most andesite upward to tuff and then rhyolite. Faulting concurrent with volcanism has produced displacements up to 400 vertical feet in the quartzite. This Wood River quartzite is brecciated and more heavily altered than the other units present. Outcrops of this quartzite are exposed in cliffs with heights of 60 to 100 feet. The downward extent of the unit is unknown pending an exploratory drilling program.

Current exploration efforts involve mapping and sampling of the extent of exposed outcrop, mapping faults and contacts within the target area, and sediment sampling around the secondary drainages. Geochemical results from the Ross Creek drainage are being evaluated. A plan will be filed with the Forest Service to permit a helicopter supported drilling program for the summer or fall of 2008.  

Roaring River property, Elmore County, Idaho

Comprised of 131 Roaring River Moly claims from the Elk Creek Corporation. The claims, covering approximately 2707 acres, are located in surveyed Sections 11, 12, 13, 14, 22, 23, 24, 25 and 26, Township 4 North, Range 8 East, Boise Principal Meridian, on federal lands administered by the Boise National Forest. 

The site is accessed from Boise and Idaho City via State highway 21, then an additional 40 miles on seasonally maintained gravel roads. Boise is the nearest city, as well as the largest city in Idaho.

Tertiary igneous rocks associated with the Sheep Creek Batholith are the principal rocks in the area. The majority of the claim block is underlain by biotite granites ranging from fine grained to porphyritic. While the northernmost BORDER=0 of the claim group abuts rhyolite cliffs. Mineralization as molybdenite associated with quartz veining and brecciation has been observed in old workings and in the fine grained granites.

- 3 -

A geochemical survey resulted in the collection of 95 soil samples from the northern half of the claim group on a 500-foot grid. Analyses were completed by ALS Chemex for molybdenum, copper, and gold. Results indicate potential drill target areas centered in the northeast and central areas. Further close-spaced sampling will assess the detailed distribution of before drilling sites are selected. A soil sampling program in the southern portion of the claim will be carried out next summer, utilizing helicopter or pack animal support. 

__________

End of Mineral Property Acquisition Agreement

__________ex10-1.htm

    Exhibit
      10.1

    STOCK
      PURCHASE AGREEMENT

    

    This
      Stock Purchase Agreement (“Agreement”) is made as of
      October 16, 2006, by and among Vemics, Inc., a Nevada corporation (“Buyer”);
      NuScribe, Inc., a Texas
      corporation (the “Company”); John Mehmet Ulgar
      Dogru, Thomas Dorsett, C. Robert Heritage Trust, Jang Kim, Reid Moody, Angela
      Moody, Steven Williams, Clark Redus and Bala Sambandam (individually a “Founding Shareholder”, and
      together, the “FoundingShareholders”); and
      the other
      shareholders of NuScribe, Inc. who are signatories hereto and are identified
      on
      the signature page hereof as the “Investor
      Shareholders.”  The Founding Shareholders and the Investor
      Shareholders are collectively referred to herein as, the “Sellers”).

    

    RECITALS

    

    Sellers
      desire to sell, and Buyer desires to purchase, all of the issued and outstanding
      shares of capital stock of the Company held by (i) the Founding Shareholders
      (the “Founders Shares”)
      and (ii) the Investor Shareholders (the “Investor Shares”, and
      collectively with the Founders Shares, the “Shares”), for the
      consideration and on the terms set forth in this Agreement.

    

    It
      is
      intended that the Contemplated Transactions qualify as a tax-free acquisition
      within the meaning of Section 368(a) of the IRC.

    

    AGREEMENT

    

    The
      parties, intending to be legally bound, agree as follows:

    

    1.           
      DEFINITIONS.  For
      purposes of this Agreement, the following terms have the meanings specified
      or
      referred to in this Section
      1:

    

    “Adjustment
      Amount” is defined
      in Section
      2.5.

    

    “Adjustment
      Shares” is defined
      in Section
      2.5.

    

    “Applicable
      Contract” means
      any Contract (a) under which any Person has or may acquire any rights, (b)
      under
      which any Person has or may become subject to any obligation or liability,
      or
      (c) by which any Person or any of the assets owned or used by it is or may
      become bound.

    

    “Best
      Efforts” means the
      efforts that a prudent Person desirous of achieving a result would use in
      similar circumstances to ensure that such result is achieved as expeditiously
      as
      possible; provided,
      however, that an obligation to use Best Efforts under this Agreement does
      not require the Person subject to that obligation to take actions that would
      result in a materially adverse change in the benefits to such Person of this
      Agreement and the Contemplated Transactions.

    

    “Breach”
—
A
“Breach”
with
      respect to any representation, warranty, covenant, obligation, or other
      provision of this Agreement or any instrument delivered pursuant to this
      Agreement will be deemed to have occurred if there is or has been (a) any
      inaccuracy in or breach of or any failure to perform or comply with, such
      representation, warranty, covenant, obligation, or other provision, or (b)
      any
      claim (by any Person) or other occurrence or circumstance that is or was
      inconsistent with such representation, warranty, covenant, obligation, or other
      provision, and the term “Breach” means any such inaccuracy, breach, failure,
      claim, occurrence, or circumstance.

    

    “Buyer”
is
      defined in the
      first paragraph of this Agreement.

    

    “Buyer
      Copyrights” is defined
      in Section
      4.22(a)(iii).

    

    “Buyer
      Financial Statements”
is defined in Section
      4.7.

    

    “Buyer
      Intellectual Property
      Assets” is defined in Section
      4.22(a).

    

    “Buyer
      Marks” is defined in
Section
      4.22(a)(i).

    

    “Buyer
      Material Contract” is
      defined in Section
      4.17(a).

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    “Buyer
      Other Benefit
      Obligations” means all obligations, arrangements, or customary practices,
      whether or not legally enforceable, to provide benefits, other than salary,
      as
      compensation for services rendered, to present or former directors, employees,
      or agents, other than obligations, arrangements, and practices that are Buyer
      Plans.  Buyer Other Benefit Obligations include consulting agreements
      under which the compensation paid does not depend upon the amount of service
      rendered, sabbatical policies, severance payment policies, and fringe benefits
      within the meaning of any equivalent Legal Requirement.

    

    “Buyer
      Patents” is defined in
Section
      4.22(a)(ii).

    

    “Buyer
      Plan” — any plan, fund,
      or program which was established, maintained or contributed to by Buyer, to
      the
      extent that such plan, fund, or program was established, maintained or
      contributed to for the purpose of providing for employees of Buyer or their
      dependents (A) medical, surgical, or hospital care or benefits, or benefits
      in
      the event of sickness, accident, disability, death or unemployment, or vacation
      benefits, apprenticeship or other training programs, or day care centers,
      scholarship funds, or prepaid legal services, (B) provides retirement income
      payments, supplemental retirement income payments or severance payment
      arrangements to employees of Buyer, or (D) results in a deferral of income
      by
      employees for periods extending to the termination of covered employment or
      beyond.  The term “Buyer Plan” shall include all
      plans, funds, or programs described in the immediately preceding sentence,
      whether qualified or unqualified, whether funded or unfunded, and whether
      existing under any applicable Legal Requirement.

    

    “Buyer
      Premises” is defined in
Section
      4.19.

    

    “Buyer
      Shares” is defined in
Section
      2.2.

    

    “Buyer
      Trade Secrets” is
      defined in Section 4.22(iv).

    

    “Buyer’s
      Disclosure Schedule”
means the disclosure schedule attached hereto as Schedule
      A, and made
      a part hereof.

    

    “Closing”
is
      defined in Section
      23.

    

    “Closing
      Date” means the date
      and time as of which the Closing actually takes place.

    

    “Company”
is
      defined in the
      first paragraph of this Agreement.

    

    “Company
      Breach” is defined in
Section
      7.5.

    

    “Company
      Other Benefit
      Obligations” means all obligations, arrangements, or customary practices,
      whether or not legally enforceable, to provide benefits, other than salary,
      as
      compensation for services rendered, to present or former directors, employees,
      or agents, other than obligations, arrangements, and practices that are Company
      Plans.  Company Other Benefit Obligations include consulting
      agreements under which the compensation paid does not depend upon the amount
      of
      service rendered, sabbatical policies, severance payment policies, and fringe
      benefits within the meaning of any equivalent Legal Requirement.

    

    “Company
      Plan” any plan, fund,
      or program which was established, maintained or contributed to by the Company,
      to the extent that such plan, fund, or program was established, maintained
      or
      contributed to for the purpose of providing for employees of the Company or
      their dependents (A) medical, surgical, or hospital care or benefits, or
      benefits in the event of sickness, accident, disability, death or unemployment,
      or vacation benefits, apprenticeship or other training programs, or day care
      centers, scholarship fluids, or prepaid legal services, (B) provides retirement
      income payments, supplemental retirement income payments or severance payment
      arrangements to employees of the Company, or (D) results in a deferral of income
      by employees for periods extending to the termination of covered employment
      or
      beyond.  The term “Company Plan” shall include
      all plans, funds, or programs described in the immediately preceding sentence,
      whether qualified or unqualified, whether funded or unfunded, and whether
      existing under any applicable Legal Requirement.

    

    “Company
      Records” is defined
      in Section
      3.5.

    

    “Consent”
means
      any approval,
      consent, ratification, waiver, or other authorization (including any
      Governmental Authorization).

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Consulting
      Agreement” is
      defined in Section
      2.4(a)(iv).

    

    “Contemplated
      Transactions”
means all of the transactions contemplated by this Agreement,
      including:

    

    (a)           
      the sale of the Shares by Sellers to Buyer;

    

    (b)           
      the execution, delivery, and performance of the Employment Agreements, the
      Consulting Agreement, the Sellers’ Releases and the Stock Pledge
      Agreement;

    

    (c)           
      the performance by Buyer and Sellers of their respective covenants and
      obligations under this Agreement; and

    

    (d)           
      Buyer’s acquisition and ownership of the Shares and exercise of control over the
      Company.

    

    “Contract”
means
      any
      agreement, contract, obligation, promise, or undertaking (whether written or
      oral and whether express or implied) that is legally binding.

    

    “Copyrights”
is
      defined in
Section
      3.20(a)(iii).

    

    “Damages”
is
      defined in Section
      10.2.

    

    “Employment
      Agreements” is
      defined in Section
      2.4(a)(iii).

    

    “Encumbrance”
means
      any
      charge, claim, community property interest, condition, equitable interest,
      lien,
      option, pledge, security interest, right of first refusal, or restriction of
      any
      kind, including any restriction on use, voting, transfer, receipt of income,
      or
      exercise of any other attribute of ownership.

    

    “Environment”
means
      soil, land
      surface or subsurface strata, surface waters (including navigable waters, ocean
      waters, streams, ponds, drainage basins, and wetlands), groundwaters, drinking
      water supply, stream sediments, ambient air (including indoor air), plant and
      animal life, and any other environmental medium or natural
      resource.

    

    “Environmental
      Law” means any
      Federal, state, local or foreign law, ordinance, rule, regulation, permit or
      authorization pertaining to the protection of human health or the
      environment.

    

    “ERISA”
means
      the Employee
      Retirement Income Security Act of 1974 or any successor law, and regulations
      and
      rules issued pursuant to that Act or any successor law.

    

    “Exchange
      Act” means the
      Securities Exchange Act of 1934 or any successor law, and regulations and rules
      issued pursuant to that Act or any successor law.

    

    “GAAP”
means
      generally
      accepted United States accounting principles, applied on a basis consistent
      with
      the basis on which the Interim Balance Sheet and the other financial statements
      referred to in Section
      3.4 were prepared.

    

    “Governmental
      Authorization”
means any approval, consent, license, permit; waiver, or other authorization
      issued, granted, given, or otherwise made available by or under the authority
      of
      any Governmental Body or pursuant to any Legal Requirement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Governmental
      Body” means
      any:

    

    (a)           
      nation, state, county, city, town, village, district, or other jurisdiction
      of
      any nature;

    

    (b)           
      federal, state, local, municipal, foreign, or other government;

    

    (c)           
      governmental or quasi-governmental authority of any nature (including any
      governmental agency, branch, department, official, or entity and any court
      or
      other tribunal);

    

    (d)           
      multi-national organization or body; or

    

    (e)           
      body exercising, or entitled to exercise, any administrative, executive,
      judicial, legislative, police, regulatory, or taxing authority or power of
      any
      nature.

    

    “Intellectual
      Property Assets”
is defined in Section
      3.20.

    

    “Interim
      Balance Sheet” is
      defined in Section
      3.4.

    

    “IRC”
means
      the Internal
      Revenue Code of 1986 or any successor law, and regulations issued by the IRS
      pursuant to the Internal Revenue Code or any successor law.

    

    “IRS”
means
      the United States
      Internal Revenue Service or any successor agency and, to the extent relevant,
      the United States Department of the Treasury.

    

    “Knowledge”
—An
      individual
      will be deemed to have “Knowledge” of a particular fact or other matter if such
      individual is actually aware of such fact or other matter.

    

    “Knowledge
      of the Buyer” means
      the Knowledge of Fred Zolla, Brian Howell, Rick Marciniak, Tom Owens, and Craig
      Stout as officers, directors and/or shareholders of Buyer.

    

    “Knowledge
      of the Company”
means the Knowledge of Thomas Dorsett and John Mehmet Ulgar Dogru as
      officers,
      directors and/or shareholders of the Company.

    

    “Legal
      Requirement” means any
      federal, state, local, municipal, foreign, international, multinational, or
      other administrative order, constitution, law, ordinance, principle of common
      law, regulation, statute, or treaty.

    

    “Marks”
is
      defined in Section
      3.20(a)(i).

    

    “Material
      Adverse Effect”
means any event, circumstance or condition that has a material adverse
      effect on
      the business, assets (including intangible assets), liabilities, financial
      condition, property or results of operations of the Company or Buyer, as
      applicable.

    

    “Order”
means
      any award,
      decision, injunction, judgment, order, ruling, subpoena, or verdict entered,
      issued, made, or rendered by any court, administrative agency, or other
      Governmental Body or by any arbitrator.

    

    “Ordinary
      Course of Business”
— An action taken by a Person will be deemed to have been taken in the
“Ordinary
      Course of Business” only if such action is consistent with the past practices of
      such Person and is taken in the ordinary course of the normal day-to-day
      operations of such Person.

    

    “Organizational
      Documents”‘,
      where applicable, means (a) the articles or certificate of incorporation and
      the
      bylaws of a corporation; (b) the partnership agreement and any statement of
      partnership of a general partnership; (c) the limited partnership agreement
      and
      the certificate of limited partnership of a limited partnership; (d) the
      articles or certificate of formation or organization, and operating agreement
      of
      any limited liability company, (e) any charter or similar document adopted
      or
      filed in connection with the creation, formation, or organization of a Person;
      and (f) any amendment to any of the foregoing.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Patents”
is
      defined in Section
      3.20(a)(ii).

    

    “Permitted
      Encumbrances” means
      (a) security interests shown on the Interim Balance Sheet (as with respect
      to
      the Company) or the Buyer Financial Statements (as with respect to Buyer) as
      securing specified liabilities or obligations, with respect to which no default
      (or event that, with notice or lapse of time or both, would constitute a
      default) exists, (b) security interests incurred in connection with the purchase
      of property or assets after the date of the Interim Balance Sheet (as with
      respect to the Company) or the Buyer Financial Statements (as with respect
      to
      Buyer (such security interests being limited to the property or assets so
      acquired), with respect to which no default (or event that, with notice or
      lapse
      of time or both, would constitute a default) exists, (c) liens for current
      taxes
      or other assessments not yet due, (d) Encumbrances in favor of operators,
      vendors, carriers, warehousemen, repairmen, mechanics, workmen and materialmen
      and construction or similar Encumbrances arising by operation of law or in
      the
      Ordinary Course of Business in respect of obligations that are not yet due
      or
      that are being contested in good faith by appropriate proceedings, and (e)
      workers’ or unemployment compensation Encumbrances arising in the Ordinary
      Course of Business.

    

    “Person”
means
      any individual,
      corporation (including any non-profit corporation), general or limited
      partnership, limited liability company, joint venture, estate, trust,
      association, organization, labor union, or other entity or Governmental
      Body.

    

    “Premises”
is
      defined in Section
      3.17.

    

    “Pro
      Rata Share” means, as to
      any Seller, the percentage obtained by dividing the number of Shares owned
      by
      such Seller by the total number of Shares.

    

    “Proceeding”
means
      any action,
      arbitration, audit, hearing, investigation, litigation, or suit (whether civil,
      criminal, administrative, investigative, or informal) commenced, brought,
      conducted, or heard by or before, or otherwise involving any Governmental Body
      or arbitrator.

    

    “Related
      Person” means, with
      respect to a particular individual:

    

    (a)           
      each other member of such individual’s Family;

    

    (b)           
      any Person that is directly or indirectly controlled by such individual or
      one
      or more members of such individual’s Family; and

    

    (c)           
      any Person with respect to which such individual or one or more members of
      such
      individual’s Family serves as a director, officer, partner, executor, or trustee
      (or in a similar capacity).

    With
      respect to a specified Person other than an individual, “Related Person”
means:

    

    (a)           
      any Person that directly or indirectly controls, is directly or indirectly
      controlled by, or is directly or indirectly under common control with such
      specified Person;

    

    (b)           
      each Person that serves as a director, officer, partner, executor, or trustee
      of
      such specified Person (or in a similar capacity); and

    

    (c)           
      any Related Person of any individual described in clause (b) or
      (c).

    

    For
      purposes of this definition, the “Family” of an individual
      includes (i) the individual, (ii) the individual’s spouse, and (iii) any other
      natural person who is related to the individual or the individual’s spouse
      within the second degree.

    

    “Representative”
means,
      with
      respect to a particular Person, any director, officer, employee, agent,
      consultant, advisor, or other representative of such Person, including legal
      counsel, accountants, and financial advisors.

    

    “Securities
      Act” means the
      Securities Act of 1933 or any successor law, and regulations and rules issued
      pursuant to that Act or any successor law.

    

    “Sellers
      Breach” is defined in
Section
      7.5.

    

    “Sellers”
is
      defined in the
      first paragraph of this Agreement

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    “Sellers’
Disclosure
      Schedule”
means the disclosure schedule attached hereto as Schedule B, and made
      a part
      hereof

    

    “Sellers’
Releases”
is
      defined
      in Section
      2.4(a)(ii).

    

    “Sellers’
Representative”
is
      defined in Section
      11.16.

    

    “Shares”
is
      defined in the
      Recitals of this Agreement.

    

    “Stock
      Pledge Agreement” is
      defined in Section
      2.4.

    

    “Subsidiary”
means,
      with
      respect to any Person (the “Owner”), any corporation
      or
      other Person of which securities or other interests having the power to elect
      a
      majority of that corporation’s or other Person’s board of directors or similar
      governing body, or otherwise having the power to direct the business and
      policies of that corporation or other Person (other than securities or other
      interests having such power only upon the happening of a contingency that has
      not occurred) are held by the Owner or one or more of its Subsidiaries; when
      used without reference to a particular Person, “Subsidiary” means a
      Subsidiary of the Company.

    

    “Tax
      Return” means any return
      (including any information return), report, statement, schedule, notice, form,
      or other document or information statement filed with or submitted to, or
      required to be filed with or submitted to, any Governmental Body in connection
      with the

    determination,
      assessment, collection, or payment of any Tax or in connection with the
      administration, implementation, or enforcement of or compliance with any Legal
      Requirement relating to any Tax.

    

    “Threatened”
means
      that a
      claim, Proceeding, dispute, action, or other matter will be deemed to have
      been
“Threatened” if any written demand or statement has been made or any written
      notice has been given.

    

    “Trade
      Secrets” is defined in
Section
      3.20(a)(iv).

    

    “Venus
      Stock Price” means
      $0.90, as adjusted for stock splits, stock dividends, stock subdivisions or
      combinations and the like.

    

    2.           
      SALE
      AND
      TRANSFER OF SHARES; CLOSING

    

    2.1           
      SHARES.  Subject
      to the terms and conditions of this Agreement, at the Closing, Sellers will
      sell
      and transfer the Shares to Buyer; and Buyer will purchase the Shares from
      Sellers.

    

    2.2           
      PURCHASE
      PRICE.  The purchase wire for the Shares will be $9,000,000
      (the “Purchase Price”), payable in the form of that number of shares of Buyer’s
      common stock, par value $0.01 per share calculated, by dividing $9,000,000
      by
      the Venues Stock Price (the “BuyerShares”).  The
      Purchase Price and the corresponding number of Buyer Shares to be delivered
      to
      Sellers shall be adjusted as provided in Sections 2.5 and
2.6
      and 2.7(d).

    

    2.3           
      CLOSING.  The
      exchange of the Buyer Shares for the Shares (the “Closing”) provided for in
      this Agreement will take place at the offices of Buyer’s counsel at 11921
      Rockville Pike, Third Floor, Rockville, MI) 20852, at 10:00 a.m. (local time)
      on
      the later of (i) October 16, 2006, or (ii) at such other time and place as
      the
      parties may agree.

    

    2.4           
      CLOSING
      OBLIGATIONS.  At the Closing:

    

    (a)           
      Sellers will deliver to Buyer:

    

    (i)           
      certificates representing the Shares, duly endorsed (or accompanied by duly
      executed stock powers) for transfer to Buyer;

    

    (ii)           
      releases in the form of Exhibit 2.4(a)(ii)
      executed by Sellers (collectively, “Sellers’ Releases”);

    

    (iii)           
      employment agreements in the form of Exhibit 2.4(a)(iii),
      executed by each of Tom Dorsett and John Dogru (together, the “Employment Agreements”)
      ;

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (iv)           
      a consulting agreement in the form of Exhibit 2.4(a)(iv),
      executed by Brian Groh (the “Consulting
      Agreement”);

    

    (v)            
      an opinion of Jackson Walker L.L.P., dated the Closing Date reasonably
      acceptable to Buyer;

     

    (vi)           
      all Consents necessary for the Company to consummate the Contemplated
      Transactions;

    

    (vii)          access
      to the Company Records; and

    

    (viii)         such
      other documents as Buyer may reasonably request for the purpose of (i) enabling
      its counsel to provide the opinion referred to in Section 2.4(b)(v), or
      (ii) otherwise facilitating the consummation or performance of any of the
      Contemplated Transactions.

    

    (b)           
      Buyer will deliver to Sellers:

    

    (i)           
      99.0% of the number of Buyer Shares, delivered to the Sellers in proportion
      to
      their respective ownership of the Shares;

    

    (ii)          
      the balance of the Buyer Shares (the “Holdback Shares”) shall be
      delivered to the Sellers pursuant to Section
      2.6(b);

    

    (iv)          an
      opinion of Shulman, Rogers, Gandal, Pordy & Ecker, PA., dated the Closing
      Date reasonably acceptable to the Seller Representative;

    

    (v)           the
      Employment Agreements, executed by Buyer;

    

    (vi)          the
      Consulting Agreement, executed by Buyer, and

    

    (vii)         all
      Consents necessary for Buyer to consummate the Contemplated Transactions;
      and

    

    (viii)        such
      other documents as Sellers may reasonably request for the purpose of (i)
      enabling its counsel to provide the opinion referred to in Section 2.4(a)(iv),
      or (ii) otherwise facilitating the consummation or performance of any of the
      Contemplated Transactions.

    

    (c)           
      Buyer and the Founding Shareholders will enter into an stock pledge agreement
      in
      a foam mutually acceptable to Buyer and the Founding Shareholders (the “StockPledge
      Agreement”), whereby
      the Founding Shareholders will pledge 10% of their Buyer’s Shares for one year
      as security for the indemnification obligations set forth in Section
      7.2.

    

    2.5           
      ADJUSTMENT
      AMOUNT.  The Purchase Price and the corresponding number of
      Buyer Shares to be delivered to Sellers shall be decreased by the amount; if
      any, by which the accrued total liabilities of the Company as of the Closing
      Date determined in accordance with GAAP is greater than $70,000, including
      Thomas Dorsett’s American Express credit card debt incurred on behalf of the
      Company (the “Adjustment
      Amount”); provided, however, no adjustment will be so made to the extent
      that the Adjustment Amount does not exceed $50,000 in either event the
      Adjustment Amount shall be converted into a number of Buyer Shares by dividing
      the Adjustment Amount by the Vemics Closing Price (the “Adjustment
      Shares”).

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    2.6           
      ADJUSTMENT
      PROCEDURE.

    

    (a)           
      The Sellers’ Representative will prepare and will cause Todd Keller, CPA, the
      Company’s certified public accountant, to review (as the Company’s expense), a
      balance sheet (“Closing
      Balance Sheet”) of the Company as of the Closing Date and a calculation
      of the Adjustment Amount.  Sellers will deliver the Closing Balance
      Sheet to Buyer within thirty (30) clays after the Closing
      Date.  Following the Closing, Buyer shall provide the Sellers’
Representative access to the records and employees of the Company to the extent
      necessary for the preparation of the Closing Balance Sheet and shall cooperate
      and cause the Company and the employees of the Company to cooperate with the
      Sellers’ Representative, the accounting firm reviewing the Closing Balance Sheet
      (the “Closing Balance Sheet
      Accounting Firm”) in connection with its preparation and review of the
      Closing Balance Sheet, which cooperation shall include executing and delivery
      to
      the Closing Balance Sheet Accounting Firm such management representation letters
      and engagement letters as may be requested by the Closing Balance Sheet
      Accounting Firm and taking all such reasonable actions necessary to permit
      completion of the review of the Closing Balance Sheet.  If within ten
      (10) days following delivery of the Closing Balance Sheet, Buyer has not given
      Sellers’ Representative notice of its objection to Sellers’ Representative’s
      calculation of the Adjustment Amount (such notice must contain a statement
      of
      the basis of Buyer’s objection), then such Adjustment Amount will be deemed to
      be the final Adjustment Amount for all purposes hereunder.  If Buyer
      gives such notice of objection, then, within three (3) business days of delivery
      of such notice of objection, the issues in dispute with respect to the
      calculation of the Adjustment Amount will be submitted to BDO Seidman, certified
      public accountants, or such other certified public accountants as Buyer and
      the
      Sellers’ Representative may agree (the “Accountants’’), for
      resolution, and (i) each party will furnish to the Accountants such workpapers
      and other documents and information relating to the disputed issues as the
      Accountants may request and are available to that party, and will be afforded
      the opportunity to present to the Accountants any material relating to the
      determination and to discuss the determination with the Accountants; (ii) the
      determination by the Accountants of the Adjustment Amount, as set forth in
      a
      notice delivered to both parties by the Accountants within twenty (20) days
      of
      the date such dispute is referred to the Accountants, will be binding and
      conclusive on the parties; and (in) Buyer and Sellers will each bear 50% of
      the
      fees of the Accountants for such determination. The date on which the Adjustment
      Amount is finally determined in accordance with this Section 2.6(a) is
      hereinafter referred to as the “DeterminationDate.”

    

    (b)           
      On the tenth (10th) business day following the (i) final acceptance of the
      calculation of the Adjustment Amount or (ii) the Determination Date, Buyer
      shall
      deliver to Sellers the Holdback Shares, less the Adjustment Shares (if any),
      allocated to Sellers based upon their respective Pro Rata Shares.

    

    2.7           
      RESTRICTIONS AND
      RIGHTS AS TO BUYER SHARES.  The following provisions shall
      apply to the Buyer Shares delivered to Sellers:

    

    (a) The
      certificate or certificates evidencing the Buyer Shares delivered to all Sellers
      will bear a restrictive legend substantially in the following form as long
      as
      applicable:

    

    “THE
      SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
      ACT
      OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAW.  THESE
      SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION
      OR RESALE, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE
      TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT COVERING THESE
      SECURITIES UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION
      OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY THAT REGISTRATION
      OF THESE SECURITIES IS NOT REQUIRED UNDER THE ACT OR UNDER APPLICABLE STATE
      SECURITIES LAWS.”

    

    The
      certificate or certificates -evidencing the Buyer Shares delivered to the
      Founding Shareholders will bear an additional restrictive legend substantially
      in the following form as long as applicable:

    

    THE
      SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CONTRACTUAL RESTRICTIONS
      ON TRANSFER EXPIRING ON OCTOBER __, 2007, PURSUANT TO THAT CERTAIN STOCK
      PURCHASE AGREEMENT DATED AS OF OCTOBER __, 2006 (THE “AGREEMENT’), BY AND AMONG
      COMPANY AND CERTAIN OTHER PARTIES THERETO.  PRIOR TO THE EXPIRATION OF
      SUCH HOLDING PERIOD, SUCH SHARES MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED AND
      THE COMPANY SHALL NOT BE REQUIRED TO GIVE EFFECT TO ANY ATTEMPTED SALE, TRANSFER
      OR.  ASSIGNMENT EXCEPT TO THE EXTENT SUCH SALE, TRANSFER OR ASSIGNMENT
      IS IN COMPLIANCE WITH THE AGREEMENT.  UPON THE WRITTEN REQUEST OF THE
      HOLDER OF THIS CERTIFICATE, THE COMPANY AGREES TO REMOVE THIS RESTRICTIVE LEGEND
      (AND ANY STOP ORDER PLACED WITH THE TRANSFER AGENT) WHEN THE HOLDING PERIOD
      HAS
      EXPIRED.”

    

    (b)           
      Except with the consent of Buyer; the Founding Shareholders agree that they
      will
      not, directly or indirectly, offer, sell, contract to sell, pledge or otherwise
      dispose of any of the Buyer Shares received as part of the Purchase Price prior
      to the first anniversary of the Closing (“Lock-Up
      Period”).  Thereafter, these restrictions will expire on a
      monthly basis with respect to eight and 33/100 percent (8.33%) of the aggregate
      number of Buyer Shares per month for the twelve (12) months following the end
      of
      the Lock-Up Period, subject to any applicable Legal Requirements.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           
      (i) If, at any time following the Closing, Buyer files a registration statement
      under the Securities Act for purposes of a public offering of securities of
      the
      Buyer for its own account, it shall notify the prior holders of Investor Shares
      (and the prior holders of Founders Shares after the first anniversary of the
      date hereof) in writing (the “CompanyNotice”).  Each
      Seller entitled to receive a Company Notice shall have the right (the “Piggyback Right”), subject to
      the limitations set forth in this Section 2.7(c), to
      include in any such registration statement all or any portion of the Buyer
      Shares then held by such Seller.  In order to exercise the Piggyback
      Right, a Seller shall give written notice to Buyer (the “Piggyback Notice”) no later
      than fifteen (15) days following the date on which the Buyer gives the Company
      Notice.  The Piggyback Notice shall set forth the number of Buyer
      Shares that such Seller desires to include in the registration
      statement.  All expenses of any such registration will be paid by the
      Buyer.

    

    (ii)  If
      the registration statement under which Buyer gives notice under this Section 2.7(c) is for
      an underwritten offering, Buyer shall so advise the Sellers in the Company
      Notice.  In such event, the right of any Seller to be included in a
      registration pursuant to this Section 2.7(c) shall
      be conditioned upon such holder’s participation in such underwritten offering
      and the inclusion of such holder’s Buyer Shares in the underwritten offering to
      the extent provided herein.  All holders of Buyer Shares proposing to
      distribute their shares by means of such underwritten offering shall-enter
      into
      an underwriting agreement in customary form with the underwriter or underwriters
      selected for such underwriting by Buyer.  Notwithstanding any other
      provision of this Agreement, if the underwriter determines in good faith that
      marketing factors require a limitation of the number of shares to be
      underwritten, the number of shares that may be included in the underwriting
      shall be allocated, first, to Buyer; second, to the holders of Buyer Shares
      on a
      pro rate basis based on the total number of Buyer Shares requested to be
      included in such registration by the holders of Buyer Shares; and third, to
      any
      stockholder of the Company (other than a holder of Buyer Shares) on a pro rata
      basis.  No such reduction shall reduce the securities being offered by
      Buyer for its own account to be included in the registration and
      underwriting.  If any holder of Buyer Shares disapproves of the terms
      of any such underwriting, such holder may elect to withdraw therefrom by written
      notice to Buyer and the underwriter, delivered at least twenty (20) business
      days prior to the effective date of the registration statement.

    

                  
      (iii) Buyer shall have the right to terminate or withdraw any registration
      initiated by it under this Section 2.7(c) prior
      to the effectiveness of such registration whether or not any holder of Buyer
      Shares has elected to include securities in such registration.

    
 

        
               
(d)            Buyer
      shall use its Best Efforts to have the Buyer listed as a reporting issuer on
      the
      Pink Sheets on or before December 31, 2006, and furthermore to be listed as
      a
      reporting bulletin board company no later than June 30, 2007. If Buyer fails
      to
      meet either of these deadlines, Buyer shall issue additional shares to Sellers
      equal to five percent (5%) of the Buyers Shares for each missed deadline up
      to a
      total of ten percent (10%) of the Buyers Shares, such additional shares to
      be
      delivered within ten (10) business days of the date of such failure to meet
      either such deadline and to be allocated to Sellers in proportion to their
      respective Pro Rata Shares.

    

             
          
(e)            With a
      view to making available to the Sellers the benefits of SEC Rule 144 and any
      other rule or regulation of the SEC that may at any time permit a Seller to
      sell
      securities of the Company to the public without registration, the Company shall:
      (i) make and keep available adequate current public information, as those terms
      are understood and defined in SEC Rule 144, at all times; (ii) use Best Efforts
      to file with the SEC in a timely manner all reports and other documents required
      of the Company under the Exchange Act (at any time after the Company has become
      subject to such reporting requirements); and (iii) furnish to any Seller, so
      long as the Seller owns any Buyers Shares, forthwith upon request (i) to the
      extent accurate, a written statement by the Company that it has complied with
      the reporting requirements of SEC Rule 144, the Securities Act, and the Exchange
      Act, or that it qualifies as a registrant whose securities may be resold
      pursuant to Fort S-3 (at any time after the Company so qualifies); (ii) a copy
      of the most recent annual or quarterly report of the Company and such other
      reports and documents so filed by the Company; and (iii) such other information
      as may be reasonably requested in availing any Seller of any rule or regulation
      of the SEC that permits the selling of any such securities without
      registration.

    

    3.           
      REPRESENTATIONS
      AND
      WARRANTIES OF SELLERS AND THE COMPANY.  Except as set forth on
      the Sellers’ Disclosure Schedule, which exceptions shall be deemed to be part of
      the representations and warranties made hereunder, the Sellers (severally and
      not jointly) and the Company hereby represents and warrant to Buyer as
      follows:

    

    3.1           
      ORGANIZATION AND
      GOOD
      STANDING.

    

    (a)           
      Section 3.1 of
      the Sellers’ Disclosure Schedule contains a complete and accurate list for the
      Company of its name, its jurisdiction of incorporation, other jurisdictions
      in
      which it is authorized to do business, and its capitalization (including the
      identity of each stockholder and the number of shares held by
      each).  The Company is a corporation duly organized, validly existing,
      and in good standing under the laws of its jurisdiction of incorporation, with
      full corporate power and authority to conduct its business as it is now being
      conducted, to own or use the properties and assets that it purports to own
      or
      use, and to perform all its obligations under Applicable
      Contracts.  The Company is duly qualified to do business as a foreign
      corporation and is in good standing under the laws of each state or other
      jurisdiction in which the failure to so qualify would have a Material Adverse
      Effect.

    

    (b)           
      The Company has delivered or made available to Buyer copies of the
      Organizational Documents of the Company, as currently in effect.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.2           
      AUTHORITY; NO
      CONFLICT.

    

    (a)           
      This Agreement constitutes the legal, valid, and binding obligation of Sellers,
      enforceable against Sellers in accordance with its terms. As to any Seller
      who
      is a party thereto, upon the execution and delivery by such Seller of the
      Employment Agreements, the Sellers’ Releases, the Consulting Agreement and the
      Stock Pledge Agreement (collectively, the “Sellers’ Closing Documents”),
      the Sellers’ Closing Documents will, as to such Seller, constitute the legal,
      valid, and binding obligations of such Seller, enforceable against such Seller
      in accordance with their respective terms except (i) as limited by applicable
      bankruptcy, insolvency, reorganization, moratorium; fraudulent conveyance,
      or
      other laws of general application relating to or affecting the enforcement
      of
      creditors’ rights generally, (ii) as limited by laws relating to the
      availability of specific performance, injunctive relief, or other equitable
      remedies, and (iii) to the extent the indemnification provisions and the choice
      of law provisions contained in the Sellers’ Closing Documents may be limited by
      applicable laws.  Sellers have the absolute and unrestricted right,
      power, authority, and capacity to execute and deliver this Agreement and, as
      to
      any Seller who is a party thereto, the Sellers’ Closing Documents, and to
      perform their obligations under this Agreement and the Sellers’ Closing
      Documents.

    

    (b)           
      Neither the execution and delivery of this Agreement nor the consummation or
      performance of any of the Contemplated Transactions will, directly or indirectly
      (with or without notice or lapse of time):

    

    (i)           
      contravene, conflict with, or result in a violation of (A) any material
      provision of the Organizational Documents of the Company, or (B) any resolution
      adopted by the board of directors or the stockholders of the
      Company;

    

    (ii)           
      contravene, conflict with, or result in a violation of; or give any Governmental
      Body or other Person the right to challenge any of the Contemplated Transactions
      or to exercise any remedy or obtain any relief under, any material Legal
      Requirement or any material Order to which the Company or any Seller, or any
      of
      the assets owned or used by Company, maybe subject;

    

    (iii)           
      contravene, conflict with, or result in a violation of any of the terms or
      requirements of, or give any Governmental Body the right to revoke, withdraw,
      suspend, cancel, terminate, or modify, any material Governmental Authorization
      that is held by the Company;

    

    (iv)           
      cause Buyer or the Company to become subject to, or to become liable for the
      payment of, any material amount of Tax;

    

    (v)           
      cause any of the assets owned by the Company to be reassessed or revalued by
      any
      taxing authority or other Governmental Body;

     

     (vi)          contravene,
      conflict with, or result in a violation or breach of any material provision
      of
      or give any Person the right to declare a default or exercise any remedy under,
      or to accelerate the maturity or performance of; or to cancel, terminate, or
      modify, any Seller Material Contract; or

    

    (vii)         
      result in the imposition or creation of any material Encumbrance upon or with
      respect to any of the assets owned or used by the Company.

    

    Neither
      the Sellers nor the Company is or will be required to give any notice to or
      obtain any Consent from any Person in connection with the execution and delivery
      of this Agreement or the consummation or performance of any of the Contemplated
      Transactions.

    

    (c)           
      Sellers are acquiring the Buyer Shares for their own account and not with a
      view
      to their distribution within the meaning of Section 2(11) of the Securities
      Act.
      Each Seller is an “accredited investor” as such term is defined in Rule 501(a)
      under the Securities Act.

    

    (d)           
      Each Seller has had an opportunity to (1) ask questions of and receive answers
      from Buyer concerning the terms and conditions of the Contemplated Transactions,
      (ii) obtain any additional information which Buyer possesses or can acquire
      without unreasonable effort or expense that is necessary to verify the accuracy
      of the information furnished, and (iii) consult and seek advice from an attorney
      of such Seller’s own choosing prior to entering into this
      Agreement.  The Company and each Seller acknowledge that, except as
      set forth herein, no representations or warranties have been made to it, or
      to
      its Representatives, by Buyer or others with respect to Buyer’s business and its
      financial condition and has obtained, in its judgment, sufficient information
      from Buyer to evaluate the merits and risks of an investment in the Buyer
      Shares.  Each Seller acknowledges that it has received full and fair
      disclosure and carefully considered each of the following items in its
      entirety:  (i) the Buyer’s Business Plan, dated March 2006 and all
      exhibits thereto; (ii) the audited financial statements of the Buyer as of
      and
      for the year ended June 30, 2004 and 2005, and unaudited interim financial
      statements as of and for the twelve months ended June 30, 2006; and (iii) the
      Risk Factors attached hereto as Exhibit
      3.2(d)(iii).  Each Seller is aware of the risks inherent in an
      investment in the Buyer Shares and acknowledges that there can be no assurance
      of the future viability or profitability of Buyer, nor can there be any
      assurance relating to the current or future value of the Buyer
      Shares.  The foregoing, however, does not limit or modify the
      representations and warranties of Buyer in Section 4 of this
      Agreement or the right of Sellers to rely thereon.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (e)           
      Each Seller has such knowledge and experience in financial, investment and
      business matters as to be capable of evaluating the merits and risk of an
      investment in the Buyer Shares. Each Seller represents and warrants that (i)
      the
      Seller’s overall commitment to investments which are not readily marketable,
      including the purchase of Buyer Shares, is reasonable in relation to the
      Seller’s net worth; (ii) each Seller is acquiring the Buyer Shares for
      investment for the Seller’s own account, and not with a view towards the resale
      or distribution of any or all such Buyer Shares; and (iii) the Seller can bear
      the economic risk of losing the Seller’s entire investment.

    

    3.3           
      CAPITALIZATION AND
      TITLE TO SHARES.

    

    (a)           
      The authorized equity securities of the Company consist of 12,000,000 shares
      of
      common stock, par value $0.001 per share, and 2,000,000 shares of preferred
      stock, par value $0.001 per share all of which have been designated as Series
      A
      Preferred Stock, of which 8,000,000 shares of common stock and 1,750,000 shares
      of Series A Preferred Stock are issued and outstanding and constitute the
      Shares. Sellers are, and will be on the Closing Date, the record owners and
      holders of the Shares. No legend or other reference to any purported Encumbrance
      appears upon any certificate representing equity securities of the Company
      other
      than restrictions under applicable securities laws. All of the outstanding
      equity securities of the Company have been duly authorized and validly issued
      and are fully paid and nonassessable. Other than the Sellers’ Closing Documents,
      there are no Contracts relating to the issuance, sale, or transfer of any equity
      securities or other securities of the Company.  None of the
      outstanding equity securities or other securities of the Company was issued
      in
      violation of the Securities Act or any other Legal Requirement.  The
      Company owns, or has any Contract to acquire, any equity securities or other
      securities of any Person or any direct or indirect equity or ownership interest
      in any other business.

    

    (b)           
      As to each Seller, such Seller is, and will be on the Closing Date, the record
      and beneficial owner and holder of the number of Shares listed next to such
      Seller’s name in Section 3.3 of the
      Sellers’ Disclosure Schedule, free and clear of all Encumbrances, except for any
      restrictions existing under applicable securities laws and the restrictions
      imposed in this Agreement.

    

    (c)           
      The Company has no Subsidiaries.

    

    3.4           
      FINANCIAL
      STATEMENTS.  The Company has delivered to Buyer.  (a)
      unaudited balance sheets of the Company as at April 31, 2006, May 31, 2006,
      June
      30, 2006 and July 31, 2006 (the “Interim Balance Sheet”), and
      the related unaudited statements of income, changes in stockholders’ equity, and
      cash flow for each of the months them ended.  Such financial
      statements and notes fairly present the financial condition and the results
      of
      operations, changes in stockholders’ equity, and cash flow of the Company as at
      the respective dates of and for the periods-referred: to in such financial
      statements, all in accordance with GAAP, subject, in the case of interim
      financial statements, to normal reaming year-end adjustments and the absence
      of
      notes; the financial statements referred to in this Section 3.4 reflect the
      consistent application of such accounting principles throughout the periods
      involved, except as disclosed in the notes to such financial
      statements.

    

    3.5           
      BOOKS AND
      RECORDS.  The looks of account, minute books, stock record
      books, and other records of the Company (the “Company Records”, all of which
      have been made available to Buyer, are complete and correct in all material
      respects.  The minute books of the Company contain materially accurate
      and complete records of all meetings held of and corporate action taken by,
      the
      stockholders, the Board of Directors, and committer of the Board of Directors
      of
      the Company, and no meeting of any such stockholders, Board of Directors, or
      committee has been held for which minutes have not been prepared and are not
      contained in such minute books.  At the Closing, all of those books
      and records will be in the possession of the Company.

    

    3.6           
      ENCUMBRANCES.  All
      material properties and assets of the Company are free and clear of all
      Encumbrances except for (i) Encumbrances reflected in the Interim Balance Sheet,
      (u) Encumbrances incurred in the Ordinary Course of Business since the date
      of
      the Interim Balance Sheet, and (iii) Permitted Encumbrances.

    

    3.7           
      [Intentionally omitted]

    

    3.8           
      NO UNDISCLOSED
      LIABILITIES.  To the Knowledge of the Company, the Company has
      no material liabilities or obligations of any nature except for liabilities
      or
      obligations reflected or reserved against in the Interim Balance Sheet and
      current liabilities incurred in the Ordinary Course of Business.

    

    3.9           
      TAXES.

    

    (a)           
      The Company has filed or caused to be filed (on a timely basis since inception)
      all Tax Returns that are or were required to be filed by or with respect to
      any
      of than, either separately or as a member of a group of corporations, pursuant
      to applicable Legal Requirements. Sellers have delivered or made available
      to
      Buyer copies of, and Section 3.9 of the
      Sellers’ Disclosure Schedule contains a complete and accurate list of, all such
      Tax Returns filed since inception.  The Company has paid, or made
      provision for the payment of, all Taxes that have or may have become due
      pursuant to those Tax Returns or otherwise, or pursuant to any assessment
      received by Sellers or the Company, except such Taxes, if any, as are listed
      in
Section 3.9 of
      the Sellers’ Disclosure Schedule and are being contested in good faith and as to
      which adequate reserves (determined in accordance with GAAP) have been provided
      in the Interim Balance Sheet.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b)           
      No Tax Return filed by or on behalf of the Company is currently being, or has
      been, audited. There is no claim or assessment pending against the Company
      for
      any alleged deficiency in Taxes or for the failure to file any Tax Return.
      Neither Seller nor the Company has given or been requested to give waivers
      or
      extensions of any statute of limitations relating to the payment of Taxes of
      the
      Company.

    

    (c)           
      All Tax Returns filed by the Company are true, correct, and complete in all
      material respects. There is no tax sharing agreement that will require any
      payment by the Company after the date of this Agreement lining the consistency
      period (as defined in Section 338(h)(4) of the IRC with respect to the sale
      of
      the Shares to Buyer), neither the Company nor any target affiliate (as defined
      in Section 338(h)(6) of the IRC with respect to the sale of the Shares to Buyer)
      has sold or will sell any property or assets to Buyer or to any member of the
      affiliated group (as defined in Section 338(h)(5) of the IRC) that includes
      Buyer.

    

    3.10           
      NO MATERIAL ADVERSE
      CHANGE.  Since the date of the Interim Balance Sheet, there has
      not been any material adverse change in the business, operations, properties,
      prospects, assets, or condition of the Company, and, to the Knowledge of the
      Company, no event has occurred or circumstance exists that may result in such
      a
      material adverse change.

    

    3.11           
      EMPLOYEE
      BENEFITS.

    

    (a)           
      Schedule 3.11(a)
      of the Sellers’ Disclosure Schedule contains a complete and accurate list
      of all Company Plans and Company Other Benefit Obligations.

    

    (b)           
      The Company has delivered or made available to Buyer: (i) all documents that
      set
      forth the terms of each Company Plan and Company Other Benefit Obligation;
      (ii)
      all personnel, payroll, and employment manuals and policies; (iii) all contracts
      with third party administrators, actuaries, investment managers, consultants,
      and other independent contractors that relate to any Company Plan or Company
      Other Benefit Obligation; (iv) all reports submitted within the four years
      preceding the date of this Agreement by third party administrators, actuaries,
      investment managers, consultants, or other independent contractors with respect
      to any Company Plan or Company Other Benefit Obligation; (v) all notices that
      were given by the Company to any Governmental Body or any current or former
      employee, participant or beneficiary, pursuant to statute, within the four
      years
      preceding the date of this Agreement; and (vi) all notices that were given
      by
      any Governmental Body to the Company within the four years preceding the date
      of
      this Agreement.

    

    (c)           
      Except as set forth in Schedule 3.11(c) of
      the Sellers’ Disclosure Schedule: (i) the Company has performed all of its
      obligations under all Company Plans and Company Other Benefit Obligations,
      including making all required contributions or payments with respect to any
      Company Plans and Company Other.  Benefit Obligations; (ii) the
      Company, with respect to all Company Plans and Company Other Benefits
      Obligations, is, and each Company Plan and Company Other Benefit Obligation
      is,
      in full compliance with all applicable Legal Requirements; (iii) the Company
      has
      made appropriate entries in its financial records and statements for all
      obligations and liabilities under such Company Plans and Company Other Benefit
      Obligations that have accrued but are not due to be paid in cash.  The
      Company has no obligations to any person or Governmental Body with respect
      to
      any Company Plans or Company Other Benefit Obligations, except as set forth
      on
      the Interim Balance Sheet; (iv) all filings required by any applicable Legal
      Requirement as to each Company Plan and Company Other Benefit Obligation has
      been timely filed, and all notices and disclosures to participants required
      by
      any Governmental Body have been timely provided; (v) the Company has the right
      to modify and terminate each Company Plan and Company Other Benefit Obligation;
      and (vi) the consummation of the Contemplated Transactions will not result
      in
      the payment, vesting, or acceleration of any benefit or amount due under any
      Company Plan and Company Other Benefit Obligation or otherwise.

    

    
      	
               

            	
              3.12

            	
              COMPLIANCE
                WITH LEGAL
                REOUIREMENTS; GOVERNMENTAL AUTHORIZATIONS.
                

            

    

    

    (a)           
      the Company is, and at all times since inception, has been, in full compliance
      with each material Legal Requirement that is applicable to it;

    

    (b)           
      no event has occurred or circumstance exists that (with or without notice or
      lapse of time) may constitute or result in a violation by the Company of, or
      a
      failure on the part of the Company to comply with, any material Legal
      Requirement; and

    

    (c)           
      the Company has not received, at any time since inception, any written notice
      from any Governmental Body or any other Person regarding any actual or alleged
      violation of; or failure to comply with, any material Legal
      Requirement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.13           
      LEGAL PROCEEDINGS;
      ORDERS.

    

    (a)           
      There is no pending Proceeding:

    

    (i)           
      that has been commenced by or against the Company; or

    

    (ii)           
      that challenges, or that may have the effect of preventing, delaying, making
      illegal, or otherwise interfering with, any of the Contemplated
      Transactions.

    

    To
      the
      Knowledge of the Company, (1) no such Proceeding has been Threatened, and (2)
      no
      event has occurred or circumstance exists that may give rise to or serve as
      a
      basis for the commencement of any such Proceeding.

    

    (b)           
      There is no Order to which the Company, or any of the assets owned or used
      by
      the Company, is subject.

    

    3.14           
      ABSENCE OF CERTAIN
      CHANGES AND EVENTS.  Since the date of the Interim Balance
      Sheet, the Company has conducted its business only in the Ordinary Course of
      Business and there has not been any:

    

    (a)           
      change in the Company’s authorized or issued capital stock; grant of any stock
      option or right to purchase shares of capital stock of the Company; issuance
      of
      any security convertible into such capital stock; grant of any registration
      rights; purchase, redemption, retirement, or other acquisition by the Company
      of
      any shares of any such capital stock; or declaration or payment of any dividend
      or other distribution or payment in respect of shares of capital
      stock;

    

    (b)           
      amendment to the Organizational Documents of the Company;

    

    (c)           
      payment or increase by the Company of any bonuses, salaries, or other
      compensation to any stockholder, director, officer, or employee (except in
      the
      Ordinary Course of Business) or entry into any employment, severance, or similar
      Contract with any director, officer, or employee;

    

    (d)           
      adoption o g or increase in the payments to or benefits under, any profit
      sharing, bonus, deferred compensation, savings, insurance, pension, retirement,
      or other employee benefit plan for or with any employees of the
      Company;

    

    (e)           
      damage to or destruction or loss of any asset or property of the Company,
      whether or not covered by insurance, that would have a Material Adverse Effect
      on the Company;

    

    (f)           
      entry into, termination of, or receipt of notice of termination of (i) any
      license, distributorship, dealer, sales representative, joint venture, credit,
      or similar agreement, or (ii) any Contract or transaction involving a total
      remaining commitment by or to the Company of at least $25,000;

    

    (g)           
      sale, lease (other than sales or leases of inventory in the Ordinary Course
      of
      Business), or other disposition of any asset or property of the Company or
      any
      Encumbrance on any material asset or property of the Company, other than
      Permitted Encumbrances;

    

    (h)           
      cancellation or waiver of any claims or rights with a value to the Company
      in
      excess of $25,000;

    

     (i)           
      material change in the accounting methods used by the Company; or

    

     (j)           
      agreement, whether oral or written, by the Company to do any of the
      foregoing.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.15           
      CONTRACTS: NO
      DEFAULTS.

    

    (a)           
      Section 3.15(a)
      of the Sellers’ Disclosure Schedule contains a complete and accurate list, and
      Sellers have delivered or made available to Buyer true and complete copies,
      of
      (each, a “Company Material
      Contract”):

    

    (i)           
      each Applicable Contract that involves performance of services or delivery
      of
      goods or materials by or to the Company, or that was not entered into in the
      Ordinary Course of Business, of an amount or value in excess of
      $20,000;

    

    (ii)           
      each Applicable Contract affecting the ownership of, leasing of, title to,
      use
      of, or any leasehold or other interest in, any real or personal property (except
      personal property leases and installment and conditional sales agreements having
      a value per item or aggregate payments of less than $10,000 and with terms
      of
      less than one year);

    

    (iii)           
      each licensing agreement or other Applicable Contract with respect to patents,
      trademarks, copyrights, or other intellectual property, including agreements
      with current or former employees, consultants, or contractors regarding the
      appropriation or the non-disclosure of any of the Intellectual Property
      Assets;

    

    (iv)           
      each collective bargaining agreement and other Applicable Contract to or with
      any labor union or other employee representative of a group of
      employees;

    

    (v)           
      each joint venture, partnership, and other Applicable Contract (however named)
      involving a sharing of profits, losses, costs, or liabilities by the Company
      with any other Person;

    

    (vi)           
      each Applicable Contract containing covenants that in any way purport to
      restrict the business activity of the Company or limit the freedom of the
      Company to engage in any line of business or to compete with any
      Person;

    

    (vii)          
      each Applicable Contract entered into other than in the Ordinary Course of
      Business that contains or provides for an express undertaking by the Company
      to
      be responsible for consequential damages;

    

    (viii)           each
      written warranty, guaranty, and or other similar undertaking with respect to
      contractual performance extended by the Company other than in the Ordinary
      Course of Business; and

    

    (xiii)            each
      written amendment, supplement, and modification in respect of any of the
      foregoing.

    

    (b)           
      Except as set forth in Section 3.15(b) of
      the Sellers’ Disclosure Schedule:

    

    (i)           
      no Seller (and no Related Person of any Seller) has or may acquire any rights
      under, and no Seller has or may become subject to any obligation or liability
      under, any Contract that relates to the business of, or any of the assets owned
      or used by, the Company; and

    

    (ii)           
      to the Knowledge of the Company, no officer, director, agent, employee,
      consultant; or contractor of the Company is bound by any Contract that purports
      to limit the ability of such officer, director, agent; employee, consultant,
      or
      contractor to (A) engage in or continue any conduct, activity, or practice
      relating to the business of the Company, or (B) assign to the Company or to
      any
      other Person any rights to any invention, improvement, or
      discovery.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           
      To the Knowledge of the Company, each Company Material Contract is in full
      force
      and effect and is valid and enforceable in accordance with its
      terms.

    

    (d)           
      To the Knowledge of the Company:

    

    (i)           
      the Company is, and at all times since October 13, 2003 has been, in full
      compliance with all applicable material terms and requirements of each Company
      Material Contract;

    

    (ii) each
      other Person that has or had any obligation or liability under any Company
      Material Contract under which the Company has or had any rights is, and at
      all
      times since inception has been, in full compliance with all material applicable
      terms and requirements of such Company Material Contract; and

    

    (iii)           
      no event has occurred or circumstance exists that (with or without notice or
      lapse of time) may result in a violation or breach of any Company Material
      Contract.

    

    3.16           
      INSURANCE.

    

    (a)           
      The Company has delivered or made available to Buyer true and complete copies
      of
      all policies of insurance to which the Company is a party or under which the
      Company, or any director of the Company, is or has been covered at any time
      within the two (2) years preceding the date of this Agreement.

    

    (b)           
      Section 3.16(b)
      of the Sellers’ Disclosure Schedule describes any self-insurance arrangement by
      or affecting the Company, including any reserves established
      thereunder:

    

    (c)           
      To the Knowledge of the Company all policies to which the Company is a party
      or
      that provide coverage to any Seller, the Company, or any director or officer
      of
      the Company:

    

    (A)           
      are valid, outstanding, and enforceable; and

    

    (B)           
      taken together, provide adequate insurance coverage for the assets and the
      operations of the Company for all risks to which the Company is normally
      exposed.

    

    3.17           
      ENVIRONMENTAL
      MATTERS.  The Company, the operation of its business and any
      real property that the Company owns or has owned, leased or has leased (the
      “Premises”) are, to the
      Knowledge of the Company, in compliance with all applicable Environmental Laws
      and orders or directives of any governmental authorities having jurisdiction
      under such Environmental Laws.  The Company has not received any
      written citation, directive, letter or other communication, or any notice of
      any
      proceeding claim or lawsuit, from any person arising out of the ownership or
      occupation of the Premises, or the conduct of its operations, and the Company
      is
      not aware of any basis therefor.  To the Knowledge of the Company, no
      material expenditures are or will be required in order to comply with any
      Environmental Laws.

    

    3.18           
      EMPLOYEES.

    

    (a)           
      Section 3.18 of
      the Sellers’ Disclosure Schedule contains a complete and accurate list of the
      following information for each employee or director of the Company, including
      each employee on leave of absence or layoff status: employer; name; job title;
      current compensation paid or payable; vacation accrued; and service credited
      for
      purposes of vesting and eligibility to participate under any Company Plan or
      Company Other Benefit Obligation.

    

    (b)           
      To the Knowledge of the Company, no employee or director of the Company is
      a
      party to, or is otherwise bound by, any agreement or arrangement, including
      any
      confidentiality, noncompetition, or proprietary rights agreement, between such
      employee or director and any other Person (“Proprietary Rights
      Agreement”) that in any way adversely affects or will affect (i) the
      performance of his duties as an employee or director of the Company, or (ii)
      the
      ability of the Company to conduct its business, including any Proprietary Rights
      Agreement with Sellers or the Company by any such employee or
      director.  To the Knowledge of the Company, no director, officer, or
      other key employee of the Company intends to terminate his employment with
      the
      Company.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.19           
      LABOR RELATIONS:
      COMPLIANCE.  The Company is not a party to any collective
      bargaining or other labor Contract.  The Company has complied in all
      respects with all material Legal Requirements relating to employment, equal
      employment opportunity, nondiscrimination, immigration, wages, hours, benefits,
      collective bargaining, the payment of social security and similar taxes,
      occupational safety and health, and plant closing.  To the Knowledge
      of the Company, the Company is not liable for the payment of any compensation,
      damages, taxes, fines, penalties, or other amounts, however designated, for
      failure to comply with any of the foregoing Legal Requirements.

    

    3.20           
      INTELLECTUAL
      PROPERTY.

    

    (a)           
      The term “Intellectual Property Assets” includes:

    

    (i)           
      the name “Nuscribe”, all fictional business names, trading names, registered and
      unregistered trademarks, service marks, and applications (collectively, “Marks”);

    

    (ii)           
      all patents, patent applications, and inventions and discoveries that may be
      patentable (collectively, “Patents”);

    

    (iii)           all
      copyrights in both published works and unpublished works (collectively, “Copyrights”);
      and

    

    (iv)           all
      know-how, trade secrets, confidential information, customer lists, software,
      technical information, data, process technology, plans, drawings, and blue
      prints (collectively, “Trade
      Secrets”);

    

    in
      each
      case owned, used, or licensed by the Company as licensee or
      licensor.

    

    (b)           
      Section 3.20(b)
      of the Sellers’ Disclosure Schedule contains a complete and accurate list and
      summary description, including any royalties paid or received by the Company,
      of
      all Contracts relating to the Intellectual Property Assets to which the Company
      is a party or by which the Company is bound, except for any license implied
      by
      the sale of a product and perpetual, paid-up licenses for commonly available
      software programs with a value of less than $1,000 under which the Company
      is
      the licensee.  There are no outstanding and, to the Knowledge of the
      Company, no Threatened disputes or disagreements with respect to any such
      agreement.

    

    (c)           
      Know-How Necessary for the Business.

    

    (i)           
      The Intellectual Property Assets are all those necessary for the operation
      of
      the Company’s business as they are currently conducted.  The Company
      is the owner of all right, title, and interest in and to each of the
      Intellectual Property Assets, free and clear of all Encumbrances, other than
      Permitted Encumbrances, and has the right to use without payment to a third
      party all of the Intellectual Property Assets.

    

    (ii)           
      Except as set forth in Section 3.20(c) of
      the Sellers’ Disclosure Schedule, all former and current employees of the
      Company has executed written Contracts with the Company that assign to the
      Company all rights to any inventions, improvements, discoveries, or information
      relating to the business of the Company.  No employee of the Company
      has entered into any Contract that restricts or limits in any way the scope
      or
      type of work in which the employee may be engaged or requires the employee
      to
      transfer, assign, or disclose information concerning his work to anyone other
      than the Company.

    

    (d)           
      Patents.

    

    (i)           
      Section 3.20(d)
      of the Sellers’ Disclosure Schedule contains a complete and accurate list and
      summary description of all filed Patents.  The Company is the owner of
      all right, title, and interest in and to each of the filed Patents, free and
      clear of all Encumbrances, other than Permitted Encumbrances.

    

    (ii)           
      All of the issued Patents are currently in compliance with all material formal
      Legal Requirements (including payment of filing, examination, and maintenance
      fees and proofs of working or use), are valid and enforceable, and are not
      subject to any maintenance fees or taxes or actions falling due within ninety
      days after the Closing Date.

    

    (iii)           
      No Patent has been or is now involved in any interference, reissue,
      reexamination, or opposition proceeding. To the Knowledge of the Company, there
      is no potentially interfering patent or patent application of any third
      party.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    None
      of
      the products manufactured and sold, nor any process or know-how used, by the
      Company infringes or is alleged to infringe any patent or other proprietary
      right of any other Person.

    

    (e)           
      Trademarks.

    

    (i)           
      Section 3.20(e)
      of Sellers’ Disclosure Schedule contains a complete and accurate list and
      summary description of all Marks.  The Company is the owner of all
      right, title, and interest in and to each of the Marks, free and clear of all
      Encumbrances, other than Permitted Encumbrances.

    

    (ii)           
      All Marks that have been registered with the United States Patent and Trademark
      Office are currently in compliance with all material formal legal requirements
      (including the timely post registration filing of affidavits of use and
      incontestability and renewal applications), are valid and enforceable, and
      are
      not subject to any maintenance fees or taxes or actions falling due within
      ninety days after the Closing Date.

    

    (iii)           
      No Mark has been or is now involved in any opposition, invalidation, or
      cancellation and, to the Knowledge of the Company, no such action is Threatened
      with the respect to any of the Marks.

    

    (iv)           
      To the Knowledge of the Company, there is no potentially interfering trademark
      or trademark application of any third party.

    

    (v)           
      None of the Marks used by the Company infringes or is alleged to infringe any
      trade name, trademark, or service mark of any third party.

    

    (f)           
      Copyrights.

    

    (i)           
      Section 3.20(f)
      of the Sellers’ Disclosure Schedule contains a complete and accurate list and
      summary description of all Copyrights.  The Company is the owner of
      all right, title, and interest in and to each of the Copyrights, free and clear
      of all Encumbrances, other than Permitted Encumbrances.

    

    (ii)           
      All the Copyrights have been registered and are currently in compliance with
      material formal legal requirements, are valid and enforceable, and are not
      subject to any maintenance fees, taxes, or actions falling due within ninety
      days after the date of Closing.

    

    (iii)
      None of the subject matter of any of the Copyrights infringes or is alleged
      to
      infringe any copyright of any third party or is a derivative work based on
      the
      work of a third party.

    

    (g)           
      Trade Secrets.

    

    (i)           
      With respect to each Trade Secret, the documentation relating to such Trade
      Secret is current, accurate, and sufficient in detail and content to identify
      and explain it and to allow its full and proper use without reliance on the
      knowledge or memory of any individual.

    

    (ii)           
      The Company has taken all reasonable precautions to protect the secrecy,
      confidentiality, and value of the Trade Secrets.

    

    (iii)           
      The Company has a right to use the Trade Secrets. The Trade Secrets are not
      part
      of the public knowledge or literature, and, to the Knowledge of the Company,
      have not been used, divulged, or appropriated either for the benefit of any
      Person (other than the Company) or to the detriment of the Company.

    

    3.21           
      CERTAIN
      PAYMENTS.  Since inception, neither the Company nor any
      director, officer, agent, or employee of the Company, or to Knowledge of the
      Company, any other Person associated with or acting for or on behalf of the
      Company, has directly or indirectly, in violation of any Legal Requirement
      (a)
      made any contribution, gift, babe, rebate, payoff influence payment, kickback,
      or other payment to any Person, private or public, regardless of form, whether
      in money, property, or services (i) to obtain favorable treatment in securing
      business, (ii) to pay for favorable treatment for business secured, or (iii)
      to
      obtain special concessions or for special concessions already obtained, for
      or
      in respect of the Company or any Affiliate of the Company, or (b) established
      or
      maintained any fiord or asset for such purposes that has not been recorded
      in
      the books and records of the Company.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.22           
      DISCLOSURE.  No
      representation or warranty of Sellers or the Company in this Agreement, and
      no
      statement in the Sellers’ Disclosure Schedule applicable to the Company, omits
      to state a material fact necessary to make the statements herein or therein,
      in
      light of the circumstances in which they were made, not misleading.

    

    3.23           
      RELATIONSHIPS WITH
      RELATED PERSONS.  None of the Sellers, or any Related Person of
      the Sellers or of the Company has, or has had, any interest in any property
      (whether real, personal, or mixed and whether tangible or intangible), used
      in
      or pertaining to the Company’s business.  No Seller or any Related
      Person of Sellers or of the Company owns, or has owned (of record or as a
      beneficial owner) an equity interest or any other financial or profit interest
      in, a Person that has (i) had business dealings or a material financial interest
      in any transaction with the Company other than business dealings or transactions
      conducted in the Ordinary Course of Business with the Company at substantially
      prevailing market prices and on substantially prevailing market terms, or (ii)
      engaged in competition with the Company with respect to any line of the products
      or services of the Company in any market presently served by the
      Company.  No Seller or any Related Person of Sellers or of the Company
      is a party to any Contract with, or has any claim or right against, the
      Company.

    

    3.24           
      BROKERS OR
      FINDERS.  Sellers and their agents have incurred no obligation
      or liability, contingent or otherwise, for brokerage or finders’ fees or agents’
commissions or other similar payment in connection with this
      Agreement

    

    4.           
      REPRESENTATIONS
      AND
      WARRANTIES OF BUYER.  Except as set forth on the Buyer’s
      Disclosure Schedule, which exceptions shall be deemed to be part of the
      representations and warranties made hereunder, Buyer represents and warrants
      to
      Sellers as follows:

    

    4.1           
      ORGANIZATION AND
      GOOD
      STANDING.  Buyer is a corporation duly organized, validly
      existing, and in good standing under the laws of the State of Nevada, with
      full
      corporate power and authority to conduct its business as it is now being
      conducted, to own or use the properties and assets that it purports to own
      or
      use, and to perform its obligations under Applicable Contracts.  Buyer
      is duly qualified to do business as a foreign corporation and is in good
      standing under the laws of each state or other jurisdiction in which the failure
      to so qualify would have a Material Adverse Effect.

    

    4.2           
      AUTHORITY NO
      CONFLICT.

    

    (a)           
      This Agreement constitutes the legal, valid, and binding obligation of Boyer,
      enforceable against Buyer in accordance with its teams. Upon the execution
      and
      delivery by Buyer of the Employment Agreements, the Sellers’ Releases, the
      Consulting Agreement and the Stock Pledge Agreement (collectively, the “Buyer’s Closing Documents”),
      the Buyer’s Closing Documents will constitute the legal, valid, and binding
      obligations of Buyer, enforceable against Buyer in accordance with their
      respective terms except (i) as limited by applicable bankruptcy, insolvency,
      reorganization, moratorium, fraudulent conveyance, or other laws of general
      application relating to or affecting the enforcement of creditors’ rights
      generally, (ii) as limited by laws relating to the availability of specific
      performance, injunctive relief, or other equitable remedies, and (iii) to the
      extent the indemnification provisions and the choice of law provisions contained
      in the Sellers’ Closing Documents may be limited by applicable laws. Buyer has
      the absolute and unrestricted right power and authority to execute and deliver
      this Agreement and the Buyer’s Closing Documents and to perform its obligations
      under this Agreement and the Buyer’s Closing Documents.

    

    (b)           
      Neither the execution and delivery of this Agreement by Buyer; nor the
      consummation or performance of any of the Contemplated Transactions by Buyer
      will, directly or indirectly (with or without notice or lapse of
      time):

    

    (i)           
      contravene, conflict with, or result in a violation of (A) any material
      provision of Buyer’s Organizational Documents, or (B) any resolution adopted by
      the board of directors or the stockholders of Buyer;

    

    (ii)           
      contravene, conflict with, or result in a violation of or give any Governmental
      Body or other Person the right to challenge any of the Contemplated Transactions
      or to exercise any remedy or obtain any relief under, any material Legal
      Requirement or any material Order to which the Buyer, or any of the assets
      owned
      or used by the Buyer, may be subject;

    

    (iii)          
      contravene, conflict with, or result in a violation of any of the teens or
      requirements of, or give any Governmental Body the right to revoke, withdraw,
      suspend, cancel, terminate, or modify, any material Governmental Authorization
      that is held by Buyer;

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (iv)           
      cause Buyer or the Company to become subject to, or to become liable for the
      payment of, any material amount of Tax;

    

    (iv)           
      cause any of the assets owned by Buyer to be reassessed or revalued by any
      taxing authority or other Governmental Body,

    

    (v)           
      contravene, conflict with, or result in a violation or breach of any material
      provision of, or give any Person the right to declare a default or exercise
      any
      remedy under, or to accelerate the maturity or performance of or to cancel,
      terminate, or modify, any Buyer Material Contract; or

    

    (vi)           
      result in the imposition or creation of any material Encumbrance upon or with
      respect to any of the assets owned or used by Buyer.

    

    Buyer
      is
      not and will not be required to give any notice to or obtain any Consent from
      any Person in connection with the execution and delivery of this Agreement
      or
      the consummation or performance of any of the Contemplated
      Transactions.

    

    (c)           
      Buyer has had an opportunity to (i) ask questions of and receive answers from
      Sellers and the Company concerning the terms and conditions of the Contemplated
      Transactions, (ii) obtain any additional information which Sellers of the
      Company possesses or can acquire without unreasonable effort or expense that
      is
      necessary to verify the accuracy of the information furnished, and (iii) consult
      and seek advice from an attorney of Buyer’s own choosing prior to entering into
      this Agreement.  Buyer acknowledges that, except as set forth herein,
      no representations or warranties have been made to it, or to its
      Representatives, by any Seller or the Company or others with respect to the
      Company’s business and its financial condition and has obtained, in its
      judgment, sufficient information from Sellers and the Company to evaluate the
      merits and risks of the Contemplated Transactions.  Buyer is aware of
      the risks inherent in the purchase of the Shares and acknowledges that there
      can
      be no assurance of the future viability or profitability of the Company, nor
      can
      there be any assurance relating to the current or future value of the
      Shares.  The foregoing; however, does not limit or modify the
      representations and warranties of Sellers and the Company in Section 3 of this
      Agreement or the right of Buyer to rely thereon.

    

    4.3           
      INVESTMENT
      INTENT.  Buyer is acquiring the Shares for its own account and
      not with a view to their distribution within the meaning of Section 2(11) of
      the
      Securities Act.  Buyer has had an opportunity to ask questions of and
      receive answers from each Seller concerning the terms and conditions of the
      Contemplated Transactions and to obtain any additional information, which the
      Sellers possess or can acquire without unreasonable effort or expense that
      is
      necessary to verify the accuracy of the information f unshed.  The
      foregoing, however, does not limit or modify the representations and warranties
      of the Company in Section 3 of this Agreement or the right of Buyer to rely
      thereon.

    

    4.4           
      CERTAIN
      PROCEEDINGS.  There is no pending Proceeding that has been
      commenced against Bayer and that challenges, or may have the effect of
      preventing, delaying making illegal, or otherwise interfering with, any of
      the
      Contemplated Transactions.  To Buyer’s Knowledge, no such Proceeding
      has been Threatened.

    

    4.5           
      BROKERS OR
      FINDERS.  Buyer and its officers and agents have incurred no
      obligation or liability, contingent or otherwise, for brokerage or finders’ fees
      or agents’ commissions or other similar payment in connection with this
      Agreement and will indemnify and hold Sellers harmless from any such payment
      alleged to be due by or through Buyer as a result of the action of Buyer or
      its
      officers or agents.

    

    4.6           
      CAPITALIZATION;
      BUYER
      SHARES.  The authorized equity securities of Buyer consist of
      75,000,000 shares of common stock, par value $0.001 per share, of which
      23,637,000 shares are issued and outstanding.  The Buyer Shares when
      issued and delivered to Sellers pursuant to this Agreement will be duly
      authorized, validly issued, fully paid and non-assessable shares of common
      stock
      of Buyer Upon delivery of the Buyer Shares to the Sellers, the Sellers will
      receive good title to the Buyer Shares, free and clear of all Encumbrances,
      except for any restrictions existing under applicable securities laws and the
      restrictions imposed in this Agreement.  Buyer has no subsidiaries
      other than Vemics, Inc, a Delaware corporation, which is wholly owned by
      Buyer.

    

    4.7           
      FINANCIAL
      STATEMENTS.  Buyer has delivered to the Company the bran sited
      consolidated balance sheet of Buyer as at June 30, 2006, and the related
      unaudited consolidated statements of income, changes in stockholders’ equity,
      and cash flow for each of the fiscal year then ended (the “Buyer Financial
      Statements”):  The Buyer Financial Statements and notes fairly
      present the financial condition and the results of operations, changes in
      stockholders’ equity, and cash flow of Buyer as at such date of and for the
      period referred to in therein, and reflect the consistent application of sound
      accounting principles throughout the periods involved, except as disclosed
      in
      the notes to the Buyer Financial Statements.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.8           
      BOOKS AND
      RECORDS.  The books of account, minute books, stock record
      books, and other records of Buyer, all of which have been made available to
      Buyer, are complete and correct and have been maintained in accordance with
      sound business practices and the requirements of Section 13(b)(2) of the
      Exchange Act (regardless of whether or not Buyer is subject to that Section),
      including the maintenance of an adequate system of internal
      controls.  The minute books of Buyer contain materially accurate and
      complete records of all meetings held of, and corporate action taken by, the
      stockholders, the Board of Directors, and committees of the Board of Directors
      of Buyer, and no meeting of any such stockholders, Board of Directors, or
      committee has been held for which minutes have not been prepared and are not
      contained in such minute books.

    

    4.9           
      TAXES.  Buyer
      has filed or caused to be filed (on a timely basis since inception) all Tax
      Returns that are or were required to be filed by or with respect to Buyer,
      either separately or as a member of a group of corporations, pursuant to
      applicable Legal Requirements.  Buyer has delivered or made available
      to Sellers copies of, and Section 4.9 of
      Buyer’s Disclosure Schedule contains a complete and accurate list of; all such
      Tax Returns filed since inception.  Buyer has paid, or made provision
      for the payment of; all Taxes that have or may have become due pursuant to
      those
      Tax Returns or otherwise, or pursuant to any assessment received by Buyer,
      except such Taxes, if any, as are listed in Schedule 4.9 of
      Buyer’s Disclosure Schedule and are being contested in good faith and as to
      which adequate reserves (determined in accordance with GAAP) have been provided
      in Buyer’s Financial Statements.

    

    4.10           
      DISCLOSURE.  No
      representation or warranty of Buyer in this Agreement, and no statement in
      the
      Buyer’s Disclosure Schedule applicable to Buyer, omits to state a material fact
      necessary to make the statements herein or therein, in light of the
      circumstances in which they were made, not misleading.

    

    4.11           
      ENCUMBRANCES.  All
      material properties and assets of Buyer are free and clear of all Encumbrances
      except for (i) Encumbrances reflected in the Buyer’s Financial Statements, (ii)
      Encumbrances incurred in the Ordinary Course of Business since the date of
      the
      Buyer’s Financial Statements, and (iii) Permitted Encumbrances.

    

    4.12           
      NO MATERIAL ADVERSE
      CHANGE.  Since the date of the Buyer Financial Statements,
      there has not been any material adverse change in the business, operations,
      properties, prospects, assets, or condition of Buyer, and, to the Knowledge
      of
      Buyer, no event has occurred or circumstance exists that may result in such
      a
      material adverse change.

    

    4.13           
      EMPLOYEE
      BENEITS.

    

    (a)           
      Schedule 4.13
      (a) of the Buyer’s Disclosure Schedule contains a complete and accurate
      list of all Buyer Plans and Buyer Other Benefit Obligations.

    

    (b)           
      Buyer has delivered or made available to Sellers: (i) all documents that set
      forth the terms of each Buyer Plan and Buyer Other Benefit Obligation; (ii)
      all
      personnel, payroll, and employment manuals and policies; (iii) all contracts
      with third party administrators, actuaries, investment managers, consultants,
      and other independent contractors that relate to any Buyer Plan or Buyer Other
      Benefit Obligation; (iv) all reports submitted within the four years preceding
      the date of this Agreement by third party administrators, actuaries, investment
      managers, consultants, or other independent contractors with respect to any
      Buyer Plan or Buyer Other Benefit Obligation; (v) all notices that were given
      by
      Buyer to any Governmental Body or any entreat or former employee, participant
      or
      beneficiary, pursuant to statute, within the four years preceding the date
      of
      this Agreement; and (vi) all notices that were given by any Governmental Body
      to
      Buyer within the four years preceding the data of this Agreement.

    

    (c)           
      Except as set forth in Schedule 4.13(c) of
      Buyer’s Disclosure Schedule:  (i) Buyer has performed all of its
      obligations under all Buyer Plans and Buyer Other Benefit Obligations, including
      making all required contributions or payments with respect to any Buyer Plans
      and Buyer Other Benefit Obligations; (ii) the Company, with respect to all
      Buyer
      Plans and Buyer Other Benefits Obligations, is, and each Buyer Plan and Buyer
      Other Benefit Obligation is, in full compliance with all applicable Legal
      Requirements; (iii) the Company has made appropriate entries in its financial
      records and statements for all obligations and liabilities under such Buyer
      Plans and Buyer Other Benefit Obligations that have accrued but are not due
      to
      be paid in cash Buyer has no obligations to any person or Governmental Body
      with
      respect to any Buyer Plans or Buyer Other Benefit Obligations, except as set
      forth on the Buyer’s Financial Statements; (iv) all filings required by any
      applicable Legal Requirement as to each Buyer Plan and Buyer Other Benefit
      Obligation has been timely filed, and all notices and disclosures to
      participants required by any Governmental Body have been timely provided; (v)
      Buyer has the right to modify and terminate each Buyer Plan and Buyer Other
      Benefit Obligation; and (vi) the consummation of the Contemplated Transactions
      will not result in the payment, vesting, or acceleration of any benefit or
      amount due under any Buyer Plan and Buyer Other Benefit Obligation or
      otherwise.

    

    4.14           
      COMPLIANCE WITH
      LEGAL
      REOUJREMENTS; GOVERNMENTAL AUTHORIZATIONS.  Except as set forth
      on Section 4.14 of Buyer’s Disclosure Schedule:

    

    (a)             Buyer
      is,
      and at all times since inception has been, in full compliance with each material
      Legal Requirement that is applicable to it;

    

    (b)           
      no event has occurred or circumstance exists that (with or without notice or
      lapse of time) may constitute or result in a violation by Buyer of, or a failure
      on the part of Buyer to comply with, any material Legal Requirement;
      and

    

    (c)           
      Buyer has not received, at any time since inception, any written notice from
      any
      Governmental Body or any other Person regarding any actual or alleged violation
      of; or failure to comply with, any Legal Requirement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.15           
      LEGAL PROCEEDINGS:
      ORDERS.

    

    (a)           
      Except as set forth on Section 4.15(a) of
      Buyer’s Disclosure Schedule, there is no pending Proceeding:

    

    (i)           
      that has been commenced by or against Buyer, or

    

    (ii)          
      that challenges, or that may have the effect of preventing, delaying, making
      illegal, or otherwise interfering with, any of the Contemplated
      Transactions.

    

    To
      the
      Knowledge of Buyer, (1) no such Proceeding has been Threatened, and (2) no
      event
      has occurred or circumstance exists that may give rise to or serve as a basis
      for the commencement of any such Proceeding.

    

    (b)           
      Except as set forth on Section 4.15(b) of
      Buyer’s Disclosure Schedule, there is no Order to which Buyer; or any of the
      assets owned or used by Buyer, is subject.

    

    4.16           
      ABSENCE OF CERTAIN
      CHANGES AND EVENTS.  Since the date of the Buyer Financial
      Statements, Buyer has conducted its business only in the Ordinary Course of
      Business and there has not been any:

    

    (a)           
      change in Buyer’s authorized or issued capital stock; grant of any stock option
      or right to purchase shares of capital stock of Buyer, issuance of any security
      convertible into such capital stock; grant of any registration rights; purchase,
      redemption, retirement, or other acquisition by Buyer of any shares of any
      such
      capital stock; or declaration or payment of any dividend or other distribution
      or payment in respect of shares of capital stock, except as set forth on Section 4.16(a) of
      Buyer’s Disclosure Schedule;

    

    (b)           
      amendment to the Organizational Documents of Buyer;

    

    (c)           
      payment or increase by Buyer of any bonuses, salaries, or other compensation
      to
      any stockholder, director, officer, or employee (except in the Ordinary Course
      of Business) or entry into any employment, severance, or similar Contract with
      any director, officer, or employee;

    

    (d)           
      adoption of; or increase in the payments to or benefits under, any profit
      sharing, bonus, deferred compensation, savings, insurance, pension, retirement,
      or other employee benefit plan for or with any employees of Buyer;

    

    (e)           
      damage to or destruction or loss of any asset or property of Buyer, whether
      or
      not covered by insurance, that would have a Material Adverse Effect on
      Buyer;

    

    (f)           
      entry into, termination of, or receipt of notice of termination of (i) any
      license, distributorship, dealer, sales representative, joint venture, credit,
      or similar agreement, or (ii) any Contract or transaction involving a total
      remaining commitment by or to Buyer of at least $25,000;

    

    (g)           
      sale, lease (other than sales or leases of inventory in the Ordinary Course
      of
      Business), or other disposition of any asset or property of Buyer or any
      Encumbrance on any material asset or property of Buyer, other than Permitted
      Encumbrances;

    

    (h)           
      cancellation or waiver of any claims or rights with a value to Buyer in
excess
      of
      $25,000;

     

    (i)      
             material change in the accounting methods used
      by Buyer; or

    

    (j)     
             agreement, whether oral or written, by
      Buyer to do any of the foregoing.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.17           
      CONTRACTS; NO
      DEFAULTS.

    

    (a)           
      Section 4.17(a)
      of Buyer’s Disclosure Schedule contains a complete and accurate list, and Buyer
      has delivered or made available to Sellers true and complete copies, of (each,
      a
“Buyer Material
      Contract”):

    

    (i)           
      each Applicable Contract that involves performance of services or delivery
      of
      goods or materials by or to Buyer, or that was not entered into in the Ordinary
      Course of Business, of an amount or value in excess of $75,000;

    

    (ii)          
      each Applicable Contract affecting the ownership of, leasing of, title to,
      use
      of or any leasehold or other interest in, any real or personal property (except
      personal property leases and installment and conditional sales agreements having
      a value per item or aggregate payments of less than $50,000 and with terms
      of
      less than one year);

    

    (iii)          each
      licensing agreement or other Applicable Contract with respect to patents,
      trademarks, copyrights, or other intellectual property, including agreements
      with current or former employees, consultants, or contractors regarding the
      appropriation or the non-disclosure of any of the Buyer Intellectual Property
      Assets;

    

    (iv)          each
      collective bargaining agreement and other Applicable Contract to or with any
      labor union or other employee representative of a group of
      employees;

    

    (v)           each
      joint venture, partnership, and other Applicable Contract (however named)
      involving a sharing of profits, losses, costs, or liabilities by Buyer with
      any
      other Person;

    

    (vi)          each
      Applicable Contract containing covenants that in any way purport to restrict
      the
      business activity of Buyer or limit the freedom of Buyer to engage in any line
      of business or to compete with any Person;

    

    (vii)         each
      written warranty, guaranty, and or other similar undertaking with respect to
      contractual performance extended by Buyer other than in the Ordinary Course
      of
      Business; and

    

    (viii)        each
      written amendment, supplement, and modification in respect of any of the
      foregoing.

    

    (b)           
      Except as set forth in Section 4.17(b) of
      Buyer’s Disclosure Schedule:

    

    (i)           
      Buyer (and no Related Person of Buyer) has not or may not acquire any rights
      under, and Buyer has not or may not become subject to any obligation or
      liability under; any Contract that relates to the business of, or any of the
      assets owned or used by, Buyer; and

    

    (ii)           
      to the Knowledge of Buyer, no officer, director, agent, employee, consultant,
      or
      contractor of Buyer is bound by any Contract that purports to limit the ability
      of such officer, director, agent, employee, consultant, or contractor to (A)
      engage in or continue any conduct, activity, or practice relating to the
      business of Buyer, or (B) assign to Buyer or to any other Person any rights
      to
      any invention, improvement, or discovery.

    

    (c)           
      To the Knowledge of Buyer, each Buyer Material Contract is in full force and
      effect and is valid and enforceable in accordance with its terms.

    

    (d)           
      To the Knowledge of Buyer:

    

    (i)           
      Buyer is, and at all times since July 17, 2001 has been, in fail compliance
      with
      all applicable material terms and requirements of each Buyer Material
      Contract;

    

    (ii)           each
      other Person that has or had any obligation or liability under any Buyer
      Material Contract under which Buyer has or had any rights is, and at all times
      since inception has been, in full compliance with all material applicable terms
      and requirements of such Buyer Material Contract; and

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (iii)           
      no event has occurred or circumstance exists that (with or without notice or
      lapse of time) may result in a violation or breach of any Buyer Material
      Contract.

    

    4.18           
      INSURANCE.

    

    (a)           
      Buyer has delivered or made available Sellers true and complete copies of all
      policies of insurance to which Buyer is a party or under which Buyer, or any
      director of the Company, is or has been covered at any time within the two
      (2)
      years preceding the date of this Agreement.

    

    (b)           
      Section 4.18(b)
      of Buyer’s Disclosure Schedule describes any self-

    insurance
      arrangement by or affecting Buyer, including any reserves established
      thereunder.

    

    (c)           
      To the Knowledge of Buyer all policies to which Buyer is a party or that provide
      coverage to Buyer, or any director or officer of Buyer:

    

    (A)           
      are valid, outstanding, and enforceable; and

    

    (B)           
      taken together, provide adequate insurance coverage for the assets and the
      operations of Buyer for all risks to which Buyer is normally
      exposed.

    

    4.19           
      ENVIRONMENTAL
      MATTERS.  Buyer, the operation of its business and any real
      property that Buyer owns or has owned, leased or has leased (the “Buyer Premises”) are, to the
      Knowledge of Buyer, in compliance with all applicable Environmental Laws and
      orders or directives of any governmental authorities having jurisdiction under
      such Environmental Laws.  Buyer has not received any written citation,
      directive, letter or other communication, or any notice of any proceeding,
      claim
      or lawsuit, from any person arising out of the ownership or occupation of the
      Buyer Premises, or the conduct of its operations, and Buyer is not aware of
      any
      basis therefor.  To the Knowledge of Buyer, no material expenditures
      are or will be required in order to comply with any Environmental
      Laws.

    

    4.20           
      EMPLOYEES.

    

    (a)           
      Section 4.20 of
      the Buyer’s Disclosure Schedule contains a complete and accurate list of the
      following information for each employee or director of Buyer, including each
      employee on leave of absence or layoff status:  employer; name; job
      title; current compensation paid or payable; vacation accrued; and service
      credited for purposes of vesting and eligibility to participate under Buyer
      Plan
      or Buyer Other Benefit Obligation.

    

    (b)           
      To the Knowledge of Buyer, no employee or director of Buyer is a party to,
      or is
      otherwise bound by, any Proprietary Rights Agreement between such employee
      or
      director and any other Person that in any way adversely affects or will affect
      (i) the performance of his duties as an employee or director of Buyer, or (ii)
      the ability of Buyer to conduct its business, including any Proprietary Rights
      Agreement with Buyer by any such employee or director. To the Knowledge of
      Buyer, no director; officer, or other key employee of Buyer intends to terminate
      his employment with Buyer.

    

    4.21           
      LABOR RELATIONS;
      COMPLIANCE.  Buyer is not a party to any collective bargaining
      or other labor Contract.  Buyer has complied in all respects with all
      material Legal Requirements relating to employment, equal employment
      opportunity, nondiscrimination, immigration, wages, hours, benefits, collective
      bargaining, the payment of social security and similar taxes, occupational
      safety and health, and plant closing.  To the Knowledge of Buyer,
      Buyer is not liable for the payment of any compensation, damages, taxes, fines,
      penalties, or other amounts, however designated, for failure to comply with
      any
      of the foregoing Legal Requirements.

    

    4.22           
      INTELLECTUAL
      PROPERTY.

    

    (a)           
      The term “Buyer Intellectual
      Property Assets” includes:

    

    (i)           
      the name “Vemics”, all fictional business names, trading names, registered and
      unregistered trademarks, service marks, and applications (collectively, “Buyer Marks”);

    

    (ii)          
      all patents, patent applications, and inventions and discoveries that may be
      patentable (collectively, “Buyer Patents”);

    

    (iii)         
      all copyrights in both published works and unpublished works (collectively,
      “Buyer Copyrights”);
      and

    

    (iv)          all
      know-how, trade secrets, confidential information, customer lists, software,
      technical information, data, process technology, plans, drawings, and blue
      prints (collectively, “Buyer
      Trade Secrets”); in
      each
      case owned, used, or licensed by Buyer as licensee or licensor.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (b)           
      Section 4.22(b)
      of the Buyer’s Disclosure Schedule contains a complete and accurate list and
      summary description, including any royalties paid or received by the Company,
      of
      all Contracts relating to the Buyer Intellectual Property Assets to which Buyer
      is a party or by which Buyer is bound, except for any license implied by the
      sale of a product and perpetual, paid up licenses for commonly available
      software programs with a value of less than $1,000 under which Buyer is the
      licensee.  There are no outstanding and, to the Knowledge of Buyer, no
      Threatened disputes or disagreements with respect to any such
      agreement

    

    (c)           
      Know How Necessary for the Business.

    

    (i)           
      The Buyer Intellectual Property Assets are all those necessary for the operation
      of Buyer’s business as they are currently conducted.  Buyer is the
      owner of all right, title, and interest in and to each of the Buyer Intellectual
      Property Assets, free and clear of all Encumbrances, other than Permitted
      Encumbrances, and has the right to use without payment to a third party all
      of
      the Buyer Intellectual Property Assets.

    

    (ii)           
      Except as set forth in Section 4.22(b) of
      the Buyer’s Disclosure Schedule, all former and current employees of Buyer have
      executed written Contracts with Buyer that assign to Buyer all rights to any
      inventions, improvements, discoveries, or information relating to the business
      of Buyer.  No employee of Buyer has entered into any Contract that
      restricts or limits in any way the scope or type of work in which the employee
      may be engaged or requires the employee to transfer, assign, or disclose
      information concerning his work to anyone other than Buyer.

    

    (d)           
      Buyer Patents.

    

    (i)           
      Section 4.22(d)
      of the Buyer’s Disclosure Schedule contains a complete and accurate list and
      summary description of all filed Buyer Patents.  Buyer is the owner of
      all right, title, and interest in and to each of the filed Buyer Patents, free
      and clear of all Encumbrances, other than Permitted Encumbrances.

    

    (ii)           
      All of the issued Patents are currently in compliance with all material formal
      Legal Requirements (including payment of filing examination, and maintenance
      fees and proofs of working or use), are valid and enforceable, and are not
      subject to any maintenance fees or taxes or actions falling due within ninety
      days after the Closing Date.

    

    (iii)           
      No Buyer Patent has been or is now involved in any interference, reissue,
      reexamination, or opposition proceeding. To the Knowledge of Buyer, there is
      no
      potentially interfering patent or patent application of any third
      party.

    

    None
      of the profits manufactured and
      sold, nor any process or expertise used, by Buyer infringes or is alleged to
      infringe any patent or other proprietary right of any other Person.

    

    (e)           
      Buyer Trademarks.

    

    (i)           
      Section 4.22(f)
      of Buyer’s Disclosure Schedule contains a complete and accurate list and summary
      description of all Buyer Marks.  Buyer is the owner of all right,
      title, and interest in and to each of the Buyer Marks, free and clear of all
      Encumbrances, other than Permitted Encumbrances.

    

    (ii)           
      All Buyer Marks that have been registered with the United States Patent and
      Trademark Office are currently in compliance with all material formal legal
      requirements (including the timely post-registration filing of affidavits of
      use
      and incontestability and renewal applications), are valid and enforceable,
      and
      are not subject to any maintenance fees or taxes or actions falling due within
      ninety days after the Closing Date.

    

    (iii)           
      No Buyer Mark has been or is now involved in any opposition, invalidation,
      or
      cancellation and, to the Knowledge of Buyer, no such action is Threatened with
      the respect to any of the Buyer Marks.

    

    (iv)           
      To the Knowledge of Buyer, there is no potentially interfering trademark or
      trademark application of any third party.

    

    (v)           
      None of the Buyer Marks used by Buyer infringes or is alleged to infringe any
      trade name, trademark, or service mark of any third party.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (f)           
      Buyer Copyrights.

    

    (i)           
      Section 4.22(f)
      of the Buyer’s Disclosure Schedule contains a complete and accurate list and
      summary description of all Buyer Copyrights.  Buyer is the owner of
      all right, title, and interest in and to each of the Buyer Copyrights, free
      and
      clear of all Encumbrances, other than Permitted Encumbrances.

    

    (ii)           
      All the Buyer Copyrights have been registered and are currently in compliance
      with material formal legal requirements, are valid and enforceable, and are
      not
      subject to any maintenance fees or taxes or actions falling due within ninety
      days after the date of Closing.

    

    (iii)           
      None of the subject matter of any of the Buyer Copyrights infringes or is
      alleged to infringe any copyright of any third party or is a derivative work
      based on the work of a third party.

    

    (g)           
      Buyer Trade Secrets.

    

    (i)           
      With respect to each Buyer Trade Secret, the documentation relating to such
      Buyer Trade Secret is current, accurate, and sufficient in detail and content
      to
      identify and explain it and to allow its full and proper use without reliance
      on
      the knowledge or memory of any individual.

    

    (ii)           
      Buyer has taken all reasonable precautions to protect the secrecy,
      confidentiality, and value of the Buyer Trade Secrets.

    

    (iii)          
      Buyer has a right to use the Buyer Trade Secrets. The Buyer Trade Secrets are
      not part of the public knowledge or literature, and, to the Knowledge of Buyer,
      have not been used, divulged, or appropriated either for the benefit of any
      Person (other than Buyer) or to the detriment of Buyer.

    

    4.23           
      CERTAIN
      PAYMENTS.  Since inception, neither Buyer nor any director,
      officer, agent, or employee of Buyer; or to Knowledge of Buyer, any other Person
      associated with or acting for or on behalf of Buyer, has directly or indirectly,
      in violation of any Legal Requirement (a) made any contribution, gift, bribe,
      rebate, payoff, influence payment, kickback, or other payment to any Person,
      private or public, regardless of form, whether in money, property, or services
      (i) to obtain favorable treatment in securing business, (ii) to pay for
      favorable treatment for business secured, or (iii) to obtain special concessions
      or for special -concessions already obtained, for or in respect of Buyer or
      any
      Affiliate of Buyer, or (b) established or maintained any fund or asset for
      such
      purposes that has not been recorded in the books and records of
      Buyer.

    

    4.24           
      RELATIONSHIPS WITH
      RELATED PERSONS.  Neither Buyer, nor any Related Person of
      Buyer, or has had, any interest in any property (whether real, personal, or
      mixed and whether tangible or intangible), used in or pertaining to Buyer’s
      business.  Neither Buyer, nor any Related Person of Buyer owns, or has
      owned (of record or as a beneficial owner) an equity interest or any other
      financial or profit interest in, a Person that has (i) had business dealings
      or
      a material financial interest in any transaction with Buyer other than business
      dealings or transactions conducted in the Ordinary Course of Business with
      Buyer
      at substantially prevailing market prices and on substantially prevailing market
      terms, or (ii) engaged in competition with Buyer with respect to any line of
      the
      products or services of Buyer in any market presently served by
      Buyer.  Neither Buyer nor any Related Person of Buyer is a party to
      any Contract with, or has any claim or right against, Buyer.

    

    5.           
      ADDITIONAL COVENANTS
      AND AGREEMENTS.

    

    5.1           
      BOARD OF DIRECTORS
      REPRESENTATION.  The Board of Directors of Buyer shall
      initially consist of nine (9) members, three (3) of which shall have been
      designated by Sellers.  At such time as the Board of Directors of
      Buyer consists of six (6) or less members, then Sellers shall be entitled to
      designate two (2) members.

    

    5.2           
      TERMINATION OF
      INVESTOR RIGHTS AND SHAREHOLDER AGREEMENT.  The Company and
      certain of the Sellers are parties to an Investor Rights and Shareholder
      Agreement dated February 28, 2006 (the “Investor Rights
      Agreement”).  The parties to the Investor Rights Agreement
      hereby agree that the Investor Rights Agreement shall be terminated
      simultaneously with the consummation of Closing hereunder and shall be of no
      further force or effect.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    5.3           
      TERMINATION OF
      FOUNDER’S STOCK RESTRICTION AGREEMENT.  Each of the Founding
      Shareholders is a party to a Founder’s Stock Restriction Agreement with the
      Company, each dated February 28, 2006 (the “Founders
      Agreements”).  The Company hereby waives its rights of first
      refusal under each of the Founders Agreements with respect to the exchange
      of
      Shares pursuant to this Agreement.  The parties to each of the
      Founders Agreements hereby agree that each of the Founders Agreements shall
      be
      terminated simultaneously with the consummation of Closing hereunder, and shall
      be of no further force or effect.

    

    5.4           
      RESIGNATION OF COMPANY
      DIRECTORS.  Effective upon the consummation of Closing
      hereunder, Thomas Dorsett and Brian Groh hereby resign as directors of the
      Company, and Fred Zolla and Craig Stout are hereby appointed in their
      place.

    

    5.5           
      RESIGNATION OF COMPANY
      OFFICERS.  Effective upon the consummation of Closing
      hereunder, Thomas Dorsett, C. Robert Dorsett and John Dogru hereby resign as
      officers of the Company, and Fred Zolla is hereby appointed as Chairman of
      the
      Board of the Company, and Craig Stout is hereby appointed as Secretary of the
      Company.

    

    6.           
      TERMINATION.  This
      Agreement may be terminated by the mutual consent of Buyer and the
      Sellers.

    

    7.           
      INDEMNIFICATION;
      REMEDIES.

    

    7.1           
      SURVIVAL; RIGHT
      TO
      INDEMNIFICATION NOT AFFECTED BY KNOWLEDGE.  All
      representations, warranties, covenants, and obligations of the Sellers and
      Buyer
      in this Agreement, the Disclosure Schedules, and any other certificate or
      document delivered pursuant to this Agreement will survive the
      Closing.  All representations, warranties, covenants, and obligations
      of the Company in this Agreement, the Disclosure Schedule, and any other
      certificate or document delivered pursuant to this Agreement will terminate
      upon
      the consummation of Closing.

    

    7.2           
      INDEMNIFICATION
      AND
      PAYMENT OF DAMAGES BY SELLERS AND THE COMPANY.  The Sellers,
      severally and not jointly, will indemnify and hold harmless Buyer and the
      Company, and their respective Representatives, stockholders, controlling
      persons, and affiliates (collectively, the “Buyer Indemnified Persons”)
      for, and will pay to the Buyer Indemnified Persons the amount of, any loss,
      liability, claim, damage (but specifically excluding incidental and
      consequential damages), expense (including costs of investigation and defense
      and reasonable attorneys’ fees), whether or not involving a third party claim
      (collectively, “Damages”), arising, directly
      or indirectly, from or in connection with:

    

    (a)           
      any Breach of any representation or warranty made by Sellers or the Company
      in
      this Agreement, the Sellers’ Disclosure Schedule, or any other certificate or
      document delivered by Sellers or the Company pursuant to this
      Agreement;

    

    (b)           
      any Breach by any Seller or the Company of any covenant or obligation of such
      Seller in this Agreement; or

    

    (c)           
      any claim by any Person for brokerage or finder’s fees or commissions or similar
      payments based upon any agreement or understanding alleged to have been made
      by
      any such Person with Sellers or the Company (or any Person acting on their
      behalf) in connection with any of the Contemplated Transactions.

    

    7.3           
      INDEMNIFICATION
      AND
      PAYMENT OF DAMAGES BY BUYER.  Buyer will indemnify and hold
      harmless Sellers and each of their respective Representatives, stockholders,
      controlling persons, affiliates, heirs, successors and assigns (collectively,
      the “Seller Indemnified
      Persons”) for, and will pay to the Seller Indemnified Persons the amount
      of any Damages arising, directly or indirectly, from or in connection
      with:

    

    (a)           
      any Breach of any representation or warranty made by Buyer in this Agreement,
      the Buyer’s Disclosure Schedule, or in any other certificate or document
      delivered by Buyer pursuant to this Agreement;

    

    (b)           
      any Breach by Buyer of any covenant or obligation of Buyer in this Agreement;
      or

    

    (c)           
      any claim by any Person for brokerage or finder’s fees or commissions or similar
      payments based upon any agreement or understanding alleged to have been made
      by
      such Person with Buyer (or any Person acting on its behalf) in connection with
      any of the Contemplated Transactions.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    7.4           
      TIME
      LIMITATIONS.  If the Closing occurs, Sellers will have no
      liability (for indemnification or otherwise) with respect to any representation
      or warranty (other than those in Sections 3.3, 3.9,
3.11,
      and 3.17), or covenant
      or
      obligation to be performed and complied with prior to the Closing Date unless
      on
      or before the first anniversary of the Closing Date, Buyer notifies Sellers
      of a
      claim specifying the factual basis of that claim in reasonable detail to the
      extent then known by Buyer; a claim with respect to Sections 3.3, 3.11,
      or 3.17 may be made
      at
      any time prior to the third anniversary of the Closing Date, and a claim with
      respect to Sections
      3.3 may be made at any time prior to the sixth anniversary of the Closing
      Date.  If the Closing occurs, Buyer will have no liability (for
      indemnification or otherwise) with respect to any representation or warranty
      (other than those in Sections 4.6, 4.9,
4.13,
      and 4.19), or covenant
      or
      obligation to be performed and complied with prior to the Closing Date, unless
      on or before first anniversary of the Closing Date Sellers notify Buyer of
      a
      claim specifying the factual basis of that claim in reasonable detail to the
      extent then known by Sellers; a claim with respect to Sections 4.9, 4.13,
      or 4.19 may be made
      at
      any tune prior to the third anniversary of the Closing Date, and a claim with
      respect to Section
      4.6 may be made at any time prior to the sixth anniversary of the Closing
      Date.  Notwithstanding anything in this Section 7.4 to the
      contrary, any by any party based on fraud may be made at any time prior to
      the
      expiration of the applicable statute of limitations for fraud.

    

    7.5           
      LIMITATIONS ON
      SELLERS’ LIABILITY.  Sellers will have no liability (for
      indemnification or otherwise) with respect to the matters described in clause
      (a), clause (b) and clause (c) of Section 7.2 until the
      total of all Damages with respect to such matters exceeds $50,000, and then
      only
      for the amount by which such Damages exceed $ 50,000.  However, first
      sentence of this Section 7.5 will not
      apply to any intentional Breach by Sellers or the Company of any covenant or
      obligation or to the breach of Section 3.3, whether
      intentional or not.  The liability of each of Seller pursuant to Section 7.2, shall be
      limited to an amount equal to ten percent (10%) of the aggregate value of the
      Buyer’s Shares (based on the Vemics Stock Price) received by such Seller under
      this Agreement, provided, however; that any liability arising out of fraud
      of
      any Seller shall be limited to the aggregate value of the Buyer’s Shares (based
      on the Vemics Stock Price) received by such Seller under this
      Agreement.  Further, in the event of a breach by a Seller of a
      representation or warranty of such Seller set forth in Sections 3.2(a),
3.3(b),
3.l5(b)(i)
      and/or
3.24 (a “Seller
      Breach”), only the
      Seller responsible for such Seller Breach shall be liable for any Damages
      sustained or incurred as a result of such Seller Breach and the Buyer, on behalf
      of itself; its affiliates, Related Persons and all Buyer Indemnified Persons,
      covenants and agrees not to seek any Damages or personal money judgment against
      any Seller other than the Seller responsible for such Seller Breach for Damages
      sustained or incurred by any Buyer Indemnified Party arising out of or in
      connection with such Seller Breach.  In addition, Buyer’s recourse
      against any Seller for Damages shall be limited to the Buyer’s Shares received
      by such Seller hereunder or, with respect to any of the Buyer’s Shares that are
      subsequently sold, exchanged or otherwise disposed of by such Seller, the
      proceeds from such sale, exchange or other disposition.

    

    7.6           
      LIMITATIONS ON BUYER’S
      LIABILITY.  Buyer will have no liability (for indemnification
      or otherwise) with respect to the matters described in clause (a) or (b) of
      Section 7.3
      until the total of all Damages with respect to such matters exceeds $50,000,
      and
      then only for the amount by which such Damages exceed
      $50,000.  However, this Section 7.6 will not
      apply to any Breach of any of Buyer’s representations and warranties of which
      Buyer had Knowledge at any time prior to the date on which such representation
      and warranty is made or any intentional Breach by Buyer of any covenant or
      obligation, and Buyer will be liable for all Damages with respect to such
      Breaches.  The total liability of Buyer pursuant to Section 7.3 shall be
      limited to an amount equal to $4,050,000.

    

    7.7           
      NO RIGHT OF
      CONTRIBUTION.  If Closing occurs, none of the Sellers shall
      have any right of contribution, indemnification or other claim against the
      Company in connection with any matter and, effective upon the consummation
      of
      Closing, the Sellers hereby release the Company from any such
      claims.

    

    7.8           
      PROCEDURE FOR
      INDEMNIFICATION-THIRD PARTY CLAIMS.

    

    (a)           
      Promptly after receipt by an indemnified party under Sections 7.2, or
7.3
      of notice
      of the commencement of any Proceeding against it, such indemnified party will,
      if a claim is to be made against an indemnifying party under such Section,
      give
      notice to the indemnifying party of the commencement of such claim, but the
      failure to notify the indemnifying party will not relieve the indemnifying
      party
      of any liability that it may have to any indemnified party, except to the extent
      that the indemnifying party demonstrates that the defense of such action is
      prejudiced by the indemnifying party’s failure to give such notice.

    

    (b)           
      If any Proceeding referred to in Section 7.8(a) is
      brought against an indemnified party and it gives notice to the indemnifying
      party of the commencement of such Proceeding the indemnifying party will, unless
      the claim involves Taxes, be entitled to participate in such Proceeding and,
      to
      the extent that it wishes (unless the indemnifying party is also a party to
      such
      Proceeding and the indemnified party determines in good faith that joint
      representation would be inappropriate), to assume the defense of such Proceeding
      with counsel satisfactory to the indemnified party and, after notice from the
      indemnifying party to the indemnified party of its election to assume the
      defense of such Proceeding the indemnifying party will not, as long as it
      diligently conduct such defense, be liable to the indemnified party under this
      Section 7 for
      any fees of other counsel or any other expenses with respect to the defense
      of
      such Proceeding in each case subsequently incurred by the indemnified party
      in
      connection with the defense of such Proceeding.  If the indemnifying
      party assumes the defense of a Proceeding, (i) no compromise or settlement
      of
      such claims may be effected by the indemnifying party without the indemnified
      party’s consent (which shall not be unreasonably withheld) unless (A) there is
      no finding or admission of any violation of Legal Requirements or any violation
      of the rights of any Person and no effect on any other claims that may be made
      against the indemnified party, and (B) the sole relief provided is monetary
      damages that are paid in fall by the indemnifying party; and (ii) the
      indemnified party will have no liability with respect to any compromise or
      settlement of such claims effected without its consent.  If notice is
      given to an indemnifying party of the commencement of any Proceeding and the
      indemnifying party does not, within ten days after the indemnified party’s
      notice is given, give notice to the indemnified party of its election to assume
      the defense of such Proceeding, the indemnified party may, by notice to the
      indemnifying party, assume the exclusive light to defend, compromise, or settle
      such Proceeding, but the indemnifying party will not be bound by any
      determination made in such Proceeding or any compromise or settlement effected
      by the indemnified party without its consent (which may not be unreasonably
      withheld).

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    (c)           
      Notwithstanding the foregoing, if an indemnified party determines in good faith
      that there is a reasonable probability that a Proceeding may adversely affect
      it
      or its affiliates other than as a result of monetary damages for which it would
      be entitled to indemnification under this Agreement, the indemnified party
      may,
      by notice to the indemnifying party, assume the exclusive right to defend,
      compromise, or settle such Proceeding, but the indemnifying party will not
      be
      bound by any determination of a Proceeding so defended or any compromise or
      settlement effected without its consent (which may not be unreasonably
      withheld).

    

    (d)           
      Sellers hereby consent to the non-exclusive jurisdiction of any court in which
      a
      Proceeding is brought against any Indemnified Person for purposes of any claim
      that an Indemnified Person may have under this Agreement with respect to such
      Proceeding or the matters alleged therein, and agree that process may be served
      on Sellers with respect to such a claim anywhere in the world.

    

    7.9           
      PROCEDURE FOR
      INDEMNIFICATION–OTHER CLAIMS.  A claim for indemnification for
      any matter not involving a third-party claim may be asserted by notice to the
      party from whom indemnification is sought.

    

    7.10           
      EXCLUSIVE
      REMEDY.  Except in the event of fraud, if the Closing occurs,
      the remedies for indemnification contained in this Section 7 shall be
      the exclusive remedies of the parties hereto, and shall be deemed exclusive
      of
      any other remedy conferred by law or equity upon any party hereto, with respect
      to any matter related to or arising out of this Agreement or any of the
      Contemplated Transactions.

    

    7.11           
      MITIGATION.

    

     (a)           
      The parties shall use reasonable efforts to collect the proceeds of any
      insurance which would have the effect of reducing Damages (in which case such
      proceeds shall reduce such Damages) and, if indemnification payments shall
      have
      been received by any indemnified person prior to the collection of such
      proceeds, such indemnified person shall remit to the indemnifying party, the
      amount of such proceeds (net of the cost of collection thereof) to the extent
      of
      indemnification payments received in respect of such Damages. To the extent
      any
      Damages of an indemnified person is reduced by receipt of payment (i) under
      insurance policies, or (i) from third parties not affiliated with the
      indemnified person, such payments (net of the expenses of the recovery thereof)
      shall be credited against such Damages.

    

        
      (b)            The amount
      of any Damages payable hereunder shall be net of any tax benefit actually
      derived (or reasonably expected to be derived) by any indemnified person on
      account of such Damages.

    

        
      (c)            The
      indemnifying party shall be subrogated to the indemnified person’s rights of
      recovery to the extent of any Damages satisfied by the indemnifying
      party.  Such indemnified person shall execute and deliver such
      instruments and papers as are necessary to assign such rights and assist in
      the
      exercise thereof.

    

    8.           
      GENERAL
      PROVISIONS.

    

    8.1           
      EXPENSES.  Except
      as otherwise expressly provided in this Agreement, Buyer will bear all expenses
      incurred by Buyer and the Company in connection with the preparation, execution,
      and performance of this Agreement and the Contemplated Transactions, including
      all fees and expenses of agents, representatives, counsel, and accountants
      up to
      an aggregate of $15,000 (but specifically excluding such expenses incurred
      by
      the Sellers).

    

    8.2           
      PUBLIC
      ANNOUNCEMENTS.  Any public announcement or similar publicity
      with respect to this Agreement or the Contemplated Transactions will be issued,
      if at all, at such time and in such manner as mutually agreed to by the
      parties.  Unless consented to by the parties in advance or required by
      Legal Requirements, prior to the Closing the parties shall keep this Agreement
      strictly confidential and may not make any disclosure of this Agreement to
      any
      Person.  Sellers and Buyer will consult with each other concerning the
      means by which the Company’s employees, customers, and suppliers and others
      having dealings with the Company will be informed of the Contemplated
      Transactions, and Buyer will have the right to be present for any such
      communication.

    

    8.3           
      CONFIDENTIALITY.  Between
      the date of this Agreement and the Closing Date, Buyer, Sellers and the Company
      will maintain in confidence, and will cause the directors, officers, employees,
      agents, and advisors of Buyer and the Company to maintain in confidence, and
      not
      use to the detriment of another party or the Company any written, oral, or
      other
      information obtained in confidence from another party or the Company in.
      connection with this Agreement or the Contemplated Transactions, unless (a)
      such
      information is already known to such party or to others not bound by a duty
      of
      confidentiality or such information becomes publicly available through no fault
      of such party, (b) the use of such information is necessary or appropriate
      in
      making any filing or obtaining any consent or approval required for the
      consummation of the Contemplated Transactions, or (c) the famishing or use
      of
      such information is required by or necessary or appropriate in connection with
      legal proceedings.

    

    8.4           
      NOTICES.  All
      notices, consents, waivers, and other communications under this Agreement must
      be in writing and will be deemed to have been duly given when (a) delivered
      by
      hand (with written confirmation of receipt), (b) sent by telecopier (with
      written confirmation of receipt), provided that a copy is mailed by registered
      mail, return receipt requested, or (c) when received by the addressee, if sent
      by a nationally recognized overnight delivery service (receipt requested),
      in
      each case to the appropriate addresses and telecopier numbers set forth below
      (or to such other addresses and telecopier numbers as a party may designate
      by
      notice to the other parties):

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
               

            	
              If
                to Sellers or the Company. 

            

    

    

    
      	
               

            	
              NuScribe,
                Inc. 

            

    

    3600
      Bee
      Caves Road

    Suite
      216

    Austin,
      Texas  78746

    Attention:  Thomas
      Dorsett

    Facsimile
      No.:  (512) 233-5190

    

    
      	
               

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

            

    

    

    Jackson
      Walker L.L.P.

    100
      Congress Avenue

    Suite
      1100

    Austin,
      Texas  78701

    Attention:  Lawrence
      A. Waks, Esq.

    Facsimile
      No.:  (512) 236-2002

    

    
      	
               

            	
              If
                to Buyer: 

            

    

    

    Vemics,
      Inc.

    523
      Avalon Gardens Drive

    Nanuet,
      New York  10954

    Attention:  Fred
      Zolla, Chairman

    Facsimile
      No.:  (845) 371-7381

    

    
      	
               

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

            

    

    

    David
      A.
      Weinstein, Esq.

    29
      Concordia Center

    P.O.
      Box
      7401

    Monroe
      Township, NJ  08831

    Facsimile
      No.:  (732) 792-1427

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.5           
      JURISDICTION; SERVICE
      OF PROCESS.  Any action or proceeding seeking to enforce any
      provision of, or based on any right arising out of, this Agreement may be
      brought against any of the parties in the courts of New York, New York, or,
      if
      it has or can acquire jurisdiction, in the United States District Court for
      the
      Southern District of New York, and each of the parties consents to the
      jurisdiction of such courts (and of the appropriate appellate courts) in any
      such action or proceeding and waives any objection to venue laid
      therein.  Process in any action or proceeding referred to in the
      preceding sentence may be served on any party anywhere in the
      world.

    

    8.6           
      FURTHER
      ASSURANCES.  The parties agree (a) to furnish upon request to
      each other such further information, (b) to execute and deliver to each other
      such other documents, and (c) to do such other acts and things, all as the
      other
      party may reasonably request for the purpose of carrying out the intent of
      this
      Agreement and the documents referred to in this Agreement.

    

    8.7           
      WAIVER.  The
      rights and remedies of the parties to this Agreement are cumulative and not
      alternative.  Neither the failure nor any delay by any party in
      exercising any right, power, or privilege under this Agreement or the documents
      referred to in this Agreement will operate as a waiver of such right, power;
      or
      privilege, and no single or partial exercise of any such right, power, or
      privilege will preclude any other or further exercise of such right, power,
      or
      privilege or the exercise of any other right, power, or privilege.  To
      the maximum extent permitted by applicable law, (a) no claim or right arising
      out of this Agreement or the documents referred to in this Agreement can be
      discharged by one party, in whole or in part, by a waiver or renunciation of
      the
      claim or right unless in writing signed by the other party; (b) no waiver that
      may be given by a party will be applicable except in the specific instance
      for
      which it is given; and (c) no notice to or demand on one party will be deemed
      to
      be a waiver of any obligation of such party or of the right of the party giving
      such notice or demand to take further action without notice or demand as
      provided in this Agreement or the documents referred to in this
      Agreement.

    

    8.8           
      ENTIRE AGREEMENT
      AND
      MODIFICATON.  This Agreement supersedes all prior agreements
      between the parties with respect to its subject matter (including the Letter
      of
      Intent between Buyer and the Company dated August ___, 2006) and constitutes
      (along with the documents referred to in this Agreement) a complete and
      exclusive statement of the terms of the agreement between the parties with
      respect to its subject matter.  This Agreement may not be amended
      except by a written agreement executed by the party to be charged with the
      amendment.

    

    8.9           
      DISCLOSURE
      SCHEDULE.  The disclosures in Sellers’ and Buyer’s Disclosure
      Schedules shall be arranged in sections corresponding to the numbered and
      lettered sections and subsections contained in Section 3 or 4
      as applicable, and
      the disclosures in any section or subsection of Sellers’ and Buyer’s Disclosure
      Schedule shall qualify other sections and subsections in Section 3 or 4,
      as applicable,
      only to the extent it is readily apparent from a reading of the disclosure
      that
      such disclosure is applicable to such other sections and
      subsections.

    

    8.10           
      ASSIGNMENTS,
      SUCCESSORS, AND NO THIRD-PARTY RIGHTS.  Neither party may
      assign any of its rights under this Agreement without the prior consent of
      the
      other parties, except that Buyer may assign any of its rights under this
      Agreement to any Subsidiary of Buyer.  Subject to the preceding
      sentence, this Agreement will apply to, be binding in all respects upon, and
      inure to the benefit of the successors and permitted assigns of the
      parties.  Nothing expressed or referred to in this Agreement will be
      construed to give any Person other than the parties to this Agreement and the
      parties described in Section 7, any legal
      or equitable right, remedy, or claim under or with respect to this Agreement
      or
      any provision of this Agreement.  This Agreement and all of its
      provisions and conditions are for the sole and exclusive benefit of the parties
      to this Agreement and their successors and assigns.

    

    8.11           
      SEVERABILITY.  If
      any provision of this Agreement is held invalid or unenforceable by any court
      of
      competent jurisdiction, the other provisions of this Agreement will remain
      in
      full force and effect.  Any provision of this Agreement held invalid
      or unenforceable only in part or degree will remain in full force and effect
      to
      the extent not held invalid or unenforceable.

    

    8.12           
      SECTION HEADINGS,
      CONSTRUCTION.  The headings of Sections in this Agreement are
      provided for convenience only and will not affect its construction or
      interpretation.  All references to “Section” or “Sections” refer to
      the corresponding Section or Sections of this Agreement.  All words
      used in this Agreement will be construed to be of such gender or number as
      the
      circumstances require.  Unless otherwise expressly provided, the word
“including” does not limit the preceding words or terms.

    

    8.13           
      TIME OF
      ESSENCE.  With regard to all dates and time periods set forth
      or referred to in this Agreement, time is of the essence.

    

    8.14           
      GOVERNING
      LAW.  This Agreement will be governed by the laws of the State
      of New York without regard to conflicts of laws principles.

    

    8.15           
      COUNTERPARTS;
      FACSIMILE SIGNATURE.  This Agreement may be executed in one or
      more counterparts, each of which will be deemed to be an original copy of this
      Agreement and all of which, when taken together, will be deemed to constitute
      one and the same agreement.  The exchange of copies of this Agreement
      and of signature pages by facsimile transmission shall constitute effective
      execution and delivery of this Agreement as to the parties and may be used
      in
      lieu of the original Agreement for all purposes.  Signatures of the
      parties transmitted by facsimile shall be deemed to be their original signatures
      for all purposes.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    8.16           
      SELLERS’
REPRESENTATIVE.

    

    (a)           
      Appointment
      Authority.  Each of the Sellers hereby appoints Thomas Dorsett
      as their representative (the “Sellers’ Representative”), as
      the attorney-in-fact for and on behalf of each Seller, and the Sellers’
Representative shall be authorized hereby to take any and all actions and make
      any decisions on behalf of the Sellers required or permitted to be taken by
      any
      of the Sellers under this Agreement or any of the Sellers’ Closing Documents in
      connection with the consummation of the Contemplated Transactions, including,
      without limitation, the exercise of the power to (i) receive or give any notice
      on behalf of Sellers pursuant to this Agreement or any of the Sellers’ Closing
      Documents, (ii) authorize delivery to Sellers of the Holdback Shares and the
      Adjustment Shares, if any, (iii) prepare the Closing Balance Sheet and deliver
      the same to Buyer and otherwise represent Sellers in, and control the
      disposition of, all matters related thereto, (iv) agree to, negotiate, enter
      into settlements and compromises of, and comply with orders of courts with
      respect to claims hereunder or under the Sellers’ Closing Documents, (v)
      terminate this Agreement pursuant to Section 6, and (vi)
      take all actions necessary in the judgment of the Sellers’ Representative for
      the accomplishment of the foregoing and all of the other terms, conditions
      and
      limitations of this Agreement and the Sellers’ Closing
      Documents.  Each of the Sellers shall be bound by all actions taken by
      the Sellers’ Representative in connection with this Agreement and the Sellers’
Closing Documents.  Buyer and the Company shall be entitled to rely on
      any action or decision of the Sellers’ Representative evidenced by a written
      document executed by the Sellers’ Representative as the action or decision of
      each of the Sellers, and Buyer and the Company shall be held harmless from
      and
      indemnified against any claim of any Seller in respect of this Section
      8.16.

    

    (b)           
      Acceptance.  The
      Seller Representative has executed this Agreement as acknowledgment and
      acceptance of the provisions of this Section
      8.16.

    

    (c)           
      Each Seller covenants and agrees that it will not voluntarily revoke the power
      of attorney conferred in this Section
      8.16.

    

    (e)           
      The Sellers’ Representative may resign as the Sellers’ Representative for any
      reason and at any time by written notice to the Buyer and each
      Seller.  The Sellers shall designate another Seller as its successor
      by a majority of the Pro Rata Shares as soon as practicable and shall notify
      the
      Buyer in writing of such designation.

     

    [SIGNATURE
      PAGES TO FOLLOW]

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      In
        Witness Whereof, the parties have executed and delivered this Agreement as
        of
        the date first written above.

       

      
        	
                BUYER:

                Vemics,
                  Inc.

                
                

                /s/
                  Fred
                  Zola                                    
                  

                Fred
                  Zolla, CEO & President

                
                

                FOUNDING
                  SHAREHOLDERS:

                
                

                /s/
                  John
                  Mehmet                              
                  

                John
                  Mehmet Ulgar Dogru

                
                

                /s/
                  Thomas
                  Dorsett                          
                  

                 Thomas
                  Dorsett

                
                

                C.
                  Robert Dorsett Heritage Trust

                
                

                By
/s/
                  C. Robert
                  Dorsett                    
                  

                C.
                  Robert Dorsett, Co-Trustee

                
                

                By
/s/
                  Loretta R.
                  Dorsett                   
                  

                Loretta
                  R. Dorsett, Co-Trustee

                
                

                /s/
                  Jang
                  Kim                                  
                  

                Jang
                  Kim

                
                

                /s/
                  Reid
                  Moody                            
                  

                Reid
                  Moody

                
                

                /s/Angela
                  Moody                         
                  

                Angela
                  Moody

                
                

                /s/
                  Clark
                  Redus                            
                  

                Clark
                  Redus

                
                

                /s/
                  Bala
                  Sambandam                     
                  

                Bala
                  Sambandam

                
                

                /s/
                  Steve
                  Williams                        
                  

                Steve
                  Williams

                
                

              	 	
                COMPANY:

                NuScribe,
                  Inc.

                
                

                /s/
                  Thomas
                  Dorsett                     
                  

                Thomas
                  Dorsett, President

                
                

                INVESTOR
                  SHAREHOLDERS:

                
                

                C.
                  Robert Dorsett Heritage Trust

                
                

                By /s/
                  C. Robert
                  Dorsett               
                  

                C.
                  Robert Dorsett, Co-Trustee

                
                

                By
                  /s/ Loretta R.
                  Dorsett               
                  

                Loretta
                  R. Dorsett, Co-Trustee

                
                

                Travis
                  Price Dorsett Trust

                
                

                By
                  /s/ C. Robert
                  Dorsett               
                  

                C.
                  Robert Dorsett, Co-Trustee

                
                

                By
                  /s/ Loretta R.
                  Dorsett               

                Loretta
                  R. Dorsett, Co-Trustee

                
                

                /s/
                  Brian
                  Groh                             
                  

                Brian
                  Groh

                
                

                /s/
                  Robert G.
                  Harris                     
                  

                Robert
                  G. Harris

                
                

                /s/
                  Maurice
                  Khollman                  
                  

                Maurice
                  Khollman

                
                

                /s/
                  Reid
                  Moody                        
                  

                Reid
                  Moody

                
                

                /s/
                  Jason
                  Moller                        
                  

                Jason
                  Moller

                
                

                /s/
                  Jonathan
                  Strain                    
                  

                Jonathan
                  Strain

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