Document:

SECURITIES
      PURCHASE AGREEMENT

    

    BETWEEN

    

    SCIENCE
      DYNAMICS CORPORATION

     

    AND

     

    BARRON
      PARTNERS LP

    

    DATED

    

    September
      15, 2006

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SECURITIES
      PURCHASE AGREEMENT

    

    This
      SECURITIES PURCHASE AGREEMENT (the “Agreement”)
      is
      made and entered into as of the 15th
      day of
      September, 2006 between Science
      Dynamics Corporation, a
      corporation organized and existing under the laws of the State of Delaware
      (the
“Company”)
      and
Barron
      Partners LP, a
      Delaware limited partnership (“Investor”).

     

    RECITALS

     

    WHEREAS,
      the
Investor
      wishes to purchase from the Company, upon the terms and subject to the
      conditions of this Agreement, for the Purchase Price as hereinafter defined,
      (a)
      the Company’s convertible subordinated promissory note (the “Note”)
      in the
      principal amount of four million five hundred thousand dollars ($4,500,000),
      the
      Note to be in the
      form
      attached hereto as Exhibit
      A,
      and (b)
      Common Stock Purchase Warrants (the “Warrants”)
      to
purchase
      up to one hundred twenty five million (125,000,000) shares of the Company’s
      common stock, par value $.01 per share (“Common Stock”) at an exercise price of
      five cents ($.05) per share, and one hundred twenty five million (125,000,000)
      shares of Common Stock at an exercise price of twelve and one-half cents
($.125)
      per
      share. The
      Note
      will be convertible into shares of Series A Preferred Stock or Common Stock,
      as
      such terms are hereinafter defined, in the manner set forth in the
      Note;
      and

     

    WHEREAS,
      pursuant
      to the RTI Agreement, as hereinafter defined, the Company is acquiring Ricardi
      Technologies, Inc., a Virginia corporation (“RTI”)
      for
      consideration consisting of fifty million (50,000,000) shares of Common Stock,
      $3,500,000 in cash, a note in the principal amount of five hundred thousand
      dollars ($500,000), and one million (1,000,000) shares of series B preferred
      stock, par value $.01 per share (“Series
      B Preferred Stock”),
      which
      are convertible into an aggregate of eight million three hundred thirty three
      thousand three hundred thirty three (8,333,333) shares of Common Stock;
      and

     

    WHEREAS,
      the
      parties intend to memorialize the terms on which the Company will sell and
      the
      Investor will purchase the Note and Warrants.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants and premises contained herein, and for
      other good and valuable consideration, the receipt and adequacy of which are
      hereby conclusively acknowledged, the parties hereto, intending to be legally
      bound, agree as follows:

    

    ARTICLE
      I

     

    INCORPORATION
      BY REFERENCE AND DEFINITIONS

     

    
      	
              1.1.

            	
              Incorporation
                by Reference.
                The foregoing recitals and the Exhibits and Schedules attached hereto
                and
                referred to herein, are hereby acknowledged to be true and accurate,
                and
                are incorporated herein by this
                reference.

            

    

     

    
      	
              1.2.

            	
              Supersedes
                Other Agreements.
                This Agreement, to the extent that it is inconsistent with any other
                instrument or understanding among the parties, shall supersede such
                instrument or understanding to the fullest extent permitted by law.
                A copy
                of this Agreement shall be filed at the Company’s principal
                office.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
              1.3.

            	
              Certain
                Definitions.
                For purposes of this Agreement, the following capitalized terms shall
                have
                the following meanings (all capitalized terms used in this Agreement
                that
                are not defined in this Article 1 shall have the meanings set forth
                elsewhere in this Agreement):

            

    

     

    1.3.1. “4.9%
      Limitation”
has
      the
      meaning set forth in Section 2.1.3 of this Agreement.

     

    1.3.2. “1933
      Act”
means
      the Securities Act of 1933, as amended.

     

    1.3.3. “1934
      Act”
means
      the Securities Exchange Act of 1934, as amended.

     

    1.3.4. “Affiliate”
means
      a
      Person or Persons directly or indirectly, through one or more intermediaries,
      controlling, controlled by or under common control with the Person(s) in
      question. The term “control,” as used in the immediately preceding sentence,
      means, with respect to a Person that is a corporation, the right to the
      exercise, directly or indirectly, of more than 50% of the voting rights
      attributable to the shares of such controlled corporation and, with respect
      to a
      Person that is not a corporation, the possession, directly or indirectly, of
      the
      power to direct or cause the direction of the management or policies of such
      controlled Person.

     

    1.3.5. “Bylaws”
      means
      the
      bylaws of the Company, as the same may be amended from time to
      time.

     

    1.3.6. “Certificate
      of Designation”
means
      the certificate of the rights, preferences and privileges, subject to the
      limitations, with respect to the Series A Preferred Stock, pursuant to Article
      Fourth of the Certificate of Incorporation. The Certificate of Designation
      shall
      be in substantially the form of Exhibit
      B
      to this
      Agreement, subject to the provision of Section 6.5 of this
      Agreement.

     

    1.3.7. “Certificate
      of Incorporation”
means
      the certificate of incorporation of the Company, as the same may be amended
      from
      time to time.

     

    1.3.8. “Change
      of Name”
means
      the change of the Company’s corporate name to a name which better reflects its
      business. 

     

    1.3.9. “Closing” means
      the
      consummation of the transactions contemplated by this Agreement, all of which
      transactions shall be consummated contemporaneously with the
      Closing.

     

    1.3.10. “Closing
      Date”
means
      the date on which the Closing occurs, which be not later than September ,
      2006.

     

    1.3.11. “Common
      Stock”
means
      the Company’s common stock, which is presently designated as the common stock,
      par value $.01 per share. 

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-2

        
          

        

      

      
        
        

      

    

     

    1.3.12. “Company’s
      Governing Documents”
means
      the Certificate of Incorporation and Bylaws.

     

    1.3.13. “Convertible
      Securities”
means
      the Note and the Series A Preferred Stock.

     

    1.3.14. “Delaware
      Law”
means
      the Delaware General Corporation Law.

     

    1.3.15. “EBITDA”
means
      consolidated earnings before interest, taxes, depreciation and amortization,
      determined in accordance with GAAP.

     

    1.3.16. “Escrow
      Agreement”
means
      the Escrow Agreement among the Company, the Investor and Sichenzia Ross Friedman
      Ference LLP, as Escrow Agent, attached hereto as Exhibit
      C
      it being
      acknowledged that the Escrow Agent is counsel for the Company.

     

    1.3.17. “Exempt
      Issuance”
means
      the issuance of (a) shares of Common Stock or options to employees, officers,
      directors of and consultants (other than consultants whose services relate
      to
      the raising of funds) of the Company pursuant to the any stock or option plan
      that was or may be adopted by a majority of the independent members of the
      Board
      of Directors of the Company or a majority of the members of a committee of
      independent directors established for such purpose, (b) securities upon the
      exercise of or conversion of any securities issued hereunder and pursuant to
      the
      Registration Rights Agreement, the Note, the Warrants and the Certificate of
      Designation and any other options, warrants or convertible securities which
      are
      outstanding on after completion of the Closing, and (c) securities issued
      pursuant to acquisitions, licensing agreements, or other strategic transactions,
      provided any such issuance shall only be to a Person which is, itself or through
      its subsidiaries, an operating company in a business which the Company’s board
      of directors believes is beneficial to the Company and in which the Company
      receives benefits in addition to the investment of funds, but shall not include
      a transaction in which the Company is issuing securities primarily for the
      purpose of raising capital or to an entity whose primary business is investing
      in securities.

     

    1.3.18. “GAAP”
means
      United States generally accepted accounting principles consistently
      applied.

     

    1.3.19. “Material
      Adverse Effect”
means
      any adverse effect on the business, operations, properties or financial
      condition of the Company that is material and adverse to the Company and its
      subsidiaries, taken as a whole and/or any condition, circumstance, or situation
      that would prohibit or otherwise materially interfere with the ability of the
      Company to perform any of its material obligations under this Agreement or
      the
      Registration Rights Agreement or to perform its obligations under any other
      material agreement.

     

    1.3.20. “Person”
means
      an individual, partnership, firm, limited liability company, trust, joint
      venture, association, corporation, or any other legal entity.

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-3

        
          

        

      

      
        
        

      

    

     

    1.3.21. “Preferred
      Stock”
shall
      mean the preferred stock, par value $.01 of the Company.

     

    1.3.22. “Purchase
      Price”
      means
      the
      four million five hundred thousand dollars ($4,500,000)
      to be
      paid by the Investor to the Company for the Note and the Warrants

     

    1.3.23. “Registration
      Rights Agreement”
means
      the registration rights agreement between the Investor and the Company in
      substantially the form of Exhibit
      D
      to this
      Agreement.

     

    1.3.24. “Registration
      Statement”
means
      the registration statement under the 1933 Act to be filed with the Securities
      and Exchange Commission for the registration of the Shares pursuant to the
      Registration Rights Agreement.

     

    1.3.25. “Restated
      Certificate”
means
      the restated certificate of incorporation in substantially the form of
Exhibit
      E
      to this
      Agreement, which shall effect the Reverse Split and the Change of Name upon
      filing with the Secretary of State of the State of Delaware.

     

    1.3.26. “Restricted
      Stockholders”
shall
      have the meaning set forth in Section 6.16 of this Agreement.

     

    1.3.27. “Reverse
      Split”
means
      a
      one-for-ten reverse split of the Common Stock.

     

    1.3.28. “RTI
      Agreement”
means
      the stock purchase agreement dated September , 2006, by and between the Company
      and stockholders of RTI with respect to the Company’s acquisition of all of the
      capital stock of RTI, such agreement to be in substantially the form provided
      to
      the Investor.

     

    1.3.29. “Securities”
means
      the Note, the shares of Series A Preferred Stock, the Warrants and the
      Shares.

     

    1.3.30. “SEC”
means
      the Securities and Exchange Commission.

     

    1.3.31. “SEC
      Documents”
means,
      at any given time, the Company’s latest Form 10-K or Form 10-KSB and all Forms
      10-Q or 10-QSB and 8-K and all proxy statements or information statements filed
      between the date the Form 10-K or Form 10-KSB was filed and the date as to
      which
      a determination is being made until such time as the Company no longer has
      an
      obligation to maintain the effectiveness of a Registration Statement as set
      forth in the Registration Rights Agreement.

     

    1.3.32. “Series
      A Preferred Stock”
means
      the shares of Series A Preferred Stock having the rights, preferences and
      privileges and subject to the limitations set forth in the Certificate of
      Designation.

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-4

        
          

        

      

      
        
        

      

    

     

    1.3.33. “Series
      B Preferred Stock”
means
      the shares of Series B Preferred Stock to be issued pursuant to the RTI
      Agreement and having the rights, preferences and privileges and subject to
      the
      limitations set forth in the Series B Certificate of Designation.

     

    1.3.34. “Series
      B Certificate of Designation”
means
      the certificate of designation relating to the Series B Preferred Stock, in
      substantially the form of Exhibit
      F
      to this
      Agreement.

     

    1.3.35. “Shares”
means,
      collectively, the shares of Common Stock issued or issuable (i) upon conversion
      of the Note or the Series A Preferred Stock or (ii) upon exercise of the
      Warrants.

     

    1.3.36. “Subsequent
      Financing”
means
      any offer and sale of shares of the Preferred Stock or debt that, in either
      case, is initially convertible into shares of Common Stock or otherwise senior
      or superior to the Series A Preferred Stock.

     

    1.3.37. “Total
      Shares”
means
      the total number of shares of Common Stock as are issuable upon conversion
      of
      the Note, such number to be determined as if the Note are never converted into
      shares of Series A Preferred Stock.

     

    1.3.38. “Transaction
      Documents”
means
      this Agreement, all Schedules and Exhibits attached hereto, the Certificate
      of
      Designation, the Warrants, the Registration Rights Agreement and all other
      documents and instruments to be executed and delivered by the parties in order
      to consummate the transactions contemplated hereby.

     

    1.3.39. “Warrants”
means
      the Common Stock Purchase Warrants in substantially the form of Exhibits
      G-1 and G-2
      to this
      Agreement.

     

    
      	
              1.4.

            	
              References
                to Agreement.
                All references in this Agreement to “herein” or words of like effect, when
                referring to preamble, recitals, article and section numbers, schedules
                and exhibits shall refer to this Agreement unless otherwise
                stated.

            

    

     

    ARTICLE
      II

     

    SALE
      AND PURCHASE OF NOTE AND WARRANTS; PURCHASE PRICE

    

    
      	
              2.1.

            	
              Sale
                of Note and Issuance of Warrants. 

            

    

     

    2.1.1. Upon
      the
      terms and subject to the conditions set forth herein, and in accordance with
      applicable law, the Company agrees
      to
      sell to the Investor, and the Investor agrees to purchase from the Company,
      on
      the Closing Date the Note and the Warrants as set forth after the Investor’s
      name on Schedule A to this Agreement for the Purchase Price. The Purchase Price
      shall be paid by the Investor to the Company on the Closing Date by a wire
      transfer
      of the
      Purchase Price into escrow to be held by the escrow agent pursuant to the terms
      of the Escrow Agreement. The Company shall cause the Note and the Warrants
      to be
      issued to the Investor upon the release of the Purchase Price to the Company
      by
      the escrow agent pursuant to the terms of the Escrow Agreement.

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-5

        
          

        

      

      
        
        

      

    

     

    2.1.2. As
      set
      forth more fully in the Note, principal and interest on the Note shall be
      automatically converted into such number of shares of Series A Preferred Stock
      as is determined by dividing the principal amount of the Note by the Preferred
      Stock Conversion Price, as set forth in the Note, which shall initially be
      fifty
      seven and one-half cents ($.575) upon the filing by the Company of the Restated
      Certificate. As set forth more fully in the Certificate of Designation, each
      share of Series A Preferred Stock will be convertible into twenty-five (25)
      shares of Common Stock. 

     

    2.1.3. Notwithstanding
      any other provision of this Agreement, except as expressly provided in the
      Note,
      the Certificate of Designation or the Warrants, no Investor shall be entitled
      to
      convert the Note or the Series A Preferred Stock
      into
      shares of Common Stock or to exercise the Warrants to the extent that such
      conversion or exercise would result in beneficial ownership by the Investor
      and
      its Affiliates of more than 4.9% of the then outstanding number of shares of
      Common Stock on such date. For the purposes of this Agreement beneficial
      ownership shall be determined in accordance with Section 13(d) of the Securities
      Exchange Act of 1934, as amended, and Regulation 13d-3 thereunder. The
      limitation set forth in this Section 2.1.3 is referred to as the “4.9%
      Limitation.”
      

     

    
      	
              2.2.

            	
              Purchase
                Price.
                The Purchase Price payable by the Investor shall be delivered by
                the
                Investor in the form of wire transfers in United States dollars from
                the
                Investor to the escrow agent pursuant to the Escrow Agreement on
                the
                Closing Date.

            

    

     

    ARTICLE
      III

     

    CLOSING
      DATE AND DELIVERIES AT CLOSING

    

    
      	3.1.	
              Closing
                Date. The
                Closing of the transactions contemplated by this Agreement shall
                be held
                at the offices of counsel for the Company, at 1:00 P.M. local time,
                on the
                Closing Date or on such other date and time and at such other place
                as may
                be mutually agreed by the parties, including Closing by facsimile
                with
                originals to follow.

            

    

     

    
      	
              3.2.

            	
              Deliveries
                by the Company.
                In
                addition to and without limiting any other provision of this Agreement,
                the Company agrees to deliver, or cause to be delivered, to the escrow
                agent under the Escrow Agreement, the following:
                

            

    

     

    (a) At
      or
      prior to Closing, an executed Agreement with all exhibits and schedules attached
      hereto.

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-6

        
          

        

      

      
        
        

      

    

     

    (b) At
      the
      Closing, the executed Note in the name of the Investor.

     

    (c) At
      or
      prior to the Closing, executed Warrants in the name of the
      Investor.

     

    (d) The
      executed Registration Rights Agreement.

     

    (e) Certifications
      in form and substance acceptable to the Company and the Investor from any and
      all brokers or agents involved in the transactions contemplated hereby as to
      the
      amount of commission or compensation payable to such broker or agent as a result
      of the consummation of the transactions contemplated hereby and from the Company
      or Investor, as appropriate, to the effect that reasonable reserves for any
      other commissions or compensation that may be claimed by any broker or agent
      have been set aside.

     

    (f) Evidence
      of approval of the board of directors of the Company of (i) the Transaction
      Documents and the transactions contemplated hereby and (ii) the Restated
      Certificate, which shall reflect the Change of Name and the Reverse Split,
      which
      shall be subject to stockholder approval.

     

    (g) Evidence
      that the Company has complied with the provisions of Sections 6.10 and 6.11
      of
      this Agreement on or prior to the Closing Date.

     

    (h) Evidence
      that the Company has filed the Certificate of Designation and the Series B
      Certificate of Designation with the Secretary of State of Delaware.

     

    (i) Good
      standing certificates of the Company issued by the Secretary of State of
      Delaware.

     

    (j) An
      opinion from the Company’s
      special
      counsel
      concerning the Transaction Documents
      and the
      transactions contemplated hereby in form and substance reasonably acceptable
      to
      Investor.

     

    (k) The
      executed Escrow Agreement.

     

    (l) Copies
      of
      all executive employment agreements, including executed amendments to the
      employment agreements between the Company and Paul Burgess and the Company
      and
      Joe Noto both dated August 28, 2006, all past and present financing
      documentation or other documentation where stock could potentially be issued
      or
      issued as payment, all past and present litigation documents and historical
      financials, not previously provided to Investor.

     

    (m) Evidence
      that the Company has complied with all of its obligations set forth in Article
      IX of this Agreement.

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-7

        
          

        

      

      
        
        

      

    

     

    (n) Evidence
      that (i) that
      the
      Company shall have settled its obligations (i) to Laurus Master Fund, Ltd.
      (“Laurus”) by the payment of $500,000, the issuance of a promissory note in the
      principal amount of $250,000 and the issuance of a warrant to purchase
      14,583,333 shares of Common Stock at $.01 per share, and (ii) to The Keshet
      Fund
      L.P. and Keshet L.P. (collectively, “Keshet”) by the issuance of 3,000,000
      shares of Common Stock in settlement of all of the Corporation’s obligations to
      Keshet

     

    (o) Such
      other documents or certificates as shall be reasonably requested by Barron
      on
      behalf of the Investor.

     

    
      	
              3.3.

            	
              Deliveries
                by Investor.
                In
                addition to and without limiting any other provision of this Agreement,
                the Investor agrees to deliver, or cause to be delivered, to the
                escrow
                agent under the Escrow Agreement, the following:
                

            

    

     

    (a) A
      deposit
      in the amount of the Purchase Price;

     

    (b) The
      executed Agreement with all Exhibits and Schedules attached hereto;

     

    (c) The
      executed Registration Rights Agreement; 

     

    (d) The
      executed Escrow Agreement; and

     

    (e) Such
      other documents or certificates as shall be reasonably requested by the Company
      or its counsel.

     

    In
      the
      event any document (other than the Note and Warrants) provided to the other
      party in Sections 3.2 and 3.3 herein are provided by facsimile, the party shall
      forward an original document to the other party within seven (7) business
      days.

     

    
      	
              3.4.

            	
              Further
                Assurances.
                The Company and the Investor shall, upon request, on or after the
                Closing
                Date, cooperate with each other (specifically, the Company shall
                cooperate
                with the Investor, and the Investor shall cooperate with the Company)
                by
                furnishing any additional information, executing and delivering any
                additional documents and/or other instruments and doing any and all
                such
                things as may be reasonably required by the parties or their counsel
                to
                consummate or otherwise implement the transactions contemplated by
                this
                Agreement. 

            

    

     

    
      	
              3.5.

            	
              Waiver.
                The Investor may waive any of the requirements of Section 3.2 of
                this
                Agreement or any of its rights under the Escrow Agreement, and the
                Company
                at its discretion may waive any of its rights of Section 3.3 of this
                Agreement or any of its rights under the Escrow
                Agreement.

            

    

     

    ARTICLE
      IV

     

    REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY 

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-8

        
          

        

      

      
        
        

      

    

     

    The
      Company represents and warrants to the Investor as of the date hereof and as
      of
      Closing (which warranties and representations shall survive the Closing
      regardless of what examinations, inspections, audits and other investigations
      the Investor has heretofore made or may hereinafter make with respect to such
      warranties and representations) as follows: 

     

    
      	
              4.1.

            	
              Organization
                and Qualification.

            

    

     

    4.1.1. The
      Company
      is a corporation duly organized, validly existing and in good standing under
      the
      laws of the State
      of
      Delaware
      and has
      the requisite corporate power and authority to own, lease and
      operate
      its properties and to carry on its business as it is now being conducted and
      is
      duly qualified to do business in any other jurisdiction by virtue of the nature
      of the businesses conducted by it or the ownership or leasing of its properties,
      except where the failure to be so qualified will not, when taken together with
      all other such failures, have a Material Adverse Effect on the business,
      operations, properties, assets, financial condition or results of operation
      of
      the Company and its subsidiaries taken as a whole.

     

    4.1.2. RTI
      will,
      at the closing date, be wholly owned by the Company. No person has any right,
      title or interest in any equity, debt or other securities of any kind, including
      any options, warrants, rights or convertible securities, of any subsidiary
      of
      the Company. 

     

    
      	
              4.2.

            	
              Governing
                Documents.
                The complete and correct copies of the Company’s Governing Documents, as
                in effect on the Closing Date, has been delivered to the
                Investor.

            

    

     

    
      	
              4.3.

            	
              Capitalization.

            

    

     

    4.3.1. The
      authorized and outstanding capital stock of the Company is
      set
      forth in the Company’s quarterly report on Form 10-Q for the quarter ended June
      30, 2006 with the SEC and updated on all subsequent SEC Documents. All shares
      of
      capital stock have been duly authorized and are validly issued, and are fully
      paid and no assessable, and free of preemptive rights. As of Closing, the
      outstanding Common Stock will be as set forth on Schedule 4.3.1 to this
      Agreement. Said Schedule 4.3.1 shall also set forth all shares issuable pursuant
      to any agreements, including employment agreements, outstanding options, plans
      providing for the grant of options, stock grants or other equity-based
      incentives, warrants, convertible securities, notes and other debt instruments.
      All outstanding shares of capital stock have been duly authorized and are
      validly issued, and are fully paid and non-assessable and free of preemptive
      rights. All shares of capital stock described above to be issued have been
      duly
      authorized and when issued, will be validly issued, fully paid and
      non-assessable and free of preemptive rights. 

     

    4.3.2. All
      shares of capital stock described above to be issued have been duly authorized
      and when issued, will be validly issued, fully paid and non-assessable and
      free
      from preemptive rights. 

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-9

        
          

        

      

      
        
        

      

    

     

    4.3.3. Except
      pursuant to this Agreement and as set forth in Schedule 4.3.1 hereto, and as
      set
      forth in the Company’s SEC Documents, filed with the SEC, as of the date hereof
      and as of the Closing Date, there are no outstanding options, warrants, rights
      to subscribe for, calls or commitments of any character whatsoever relating
      to,
      or securities or rights convertible into or exchangeable for, shares of any
      class of capital stock of the Company, or agreements, understandings or
      arrangements to which the Company is a party, or by which the Company is or
      may
      be bound, to issue additional shares of its capital stock or options, warrants,
      scrip or rights to subscribe for, calls or commitment of any character
      whatsoever relating to, or securities or rights convertible into or exchangeable
      for, any shares of any class of its capital stock. The Company agrees to inform
      the Investor in writing of any additional warrants granted prior to the Closing
      Date.

     

    4.3.4. The
      Company on the Closing Date (i) will have full right, power, and authority
      to
      sell, the Note and Warrants to the Investor, free and clear of all liens,
      charges, claims, options, pledges, restrictions, and encumbrances whatsoever;
      and (ii) upon conversion of the Note or Series A Preferred Stock issuable upon
      conversion of the Note and upon exercise of the Warrants, the Investor will
      acquire title to the Shares issuable upon such conversion or exercise, free
      and
      clear of all liens, charges, claims, options, pledges, restrictions, and
      encumbrances whatsoever, except as otherwise provided in this Agreement and
      except for any of the foregoing which results from actions or omissions on
      the
      part of the Investor; provided, however, that as of the date of this Agreement
      and as of the Closing Date, the Company does not have sufficient authorized
      Common Stock for issuance upon conversion of the Note or the Series A Preferred
      Stock or upon exercise of the Warrants. Accordingly, the Company agrees that,
      not later than thirty (30) days from the Closing Date, the Company will file
      with the SEC a proxy statement pursuant to Regulation 14A of the SEC pursuant
      to
      the 1934 Act seeking stockholder approval of the Restated Certificate, and
      the
      Company will use all commercially reasonable efforts to obtain stockholder
      approval as soon as practical after filing the proxy statement. 

     

    
      	
              4.4.

            	
              Authority.

            

    

     

    4.4.1. The
      Company has, subject to the qualification set forth in Section 4.3.4 of this
      Agreement, all requisite corporate power and authority to execute and deliver
      this Agreement, the Note and the Warrants, to perform its obligations hereunder
      and thereunder and to consummate the transactions contemplated hereby and
      thereby. The execution and delivery of this Agreement by the Company and the
      consummation of the transactions contemplated hereby have been duly authorized
      by all necessary corporate action and no other corporate proceedings on the
      part
      of the Company is necessary to authorize this Agreement or to consummate the
      transactions contemplated hereby except as disclosed in this Agreement;
      provided, however, that stockholder approval is required for the Company to
      adopt the Restated Certificate. This Agreement has been duly executed and
      delivered by the Company and constitutes the legal, valid and binding obligation
      of the Company, enforceable against the Company in accordance with its terms
      subject to said Section 4.3.4;
      provided, however, that no representation is made with respect to the ability
      of
      either Investor to convert the Note or, following the filing of the Restated
      Certificate and the Certificate of Designation, the Series A Preferred Stock
      or
      exercise any Warrant if and to the extent that the Conversion Price of the
      Note
      or the Series A Preferred Stock, as defined in the Note or the Certificate
      of
      Designation, or the number of Shares issuable upon exercise of the Warrants
      would result in the issuance of a number of shares of Common Stock which is
      greater than the amount by which the authorized Common Stock exceeds the sum
      of
      the outstanding Common Stock and the shares of Common Stock reserved for
      issuance pursuant to outstanding agreements and outstanding options, warrants,
      rights, convertible securities and other securities upon the exercise or
      conversion of which or pursuant to the terms of which additional shares of
      Common Stock may be issuable (the foregoing proviso being referred to as the
      “Authorized
      Stock Proviso”).

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-10

        
          

        

      

      
        
        

      

    

     

    4.4.2. The
      Company’s
      board of directors has adopted the Restated Certificate and the Certificate
      of
      Designation, subject to stockholder approval of the Restated Certificate, as
      required by the Delaware Law. 

     

    4.4.3. The
      shares of Series A Preferred Stock issuable upon conversion of the Note and
      the
      Shares issuable upon conversion of the Note and the Series A Preferred Stock
      and
      upon exercise of the Warrants will be, when so issued after filing of the
      Restated Certificate, duly and validly authorized and issued, fully paid and
      non-assessable and not issued in violation of any preemptive rights or rights
      of
      first refusal.

     

    4.4.4. Upon
      the
      filing with the Secretary of State of the State of Delaware of the Restated
      Certificate, the shares of Series A Preferred Stock issued upon conversion
      of
      the Note will be duly and validly authorized and issued, fully paid and
      non-assessable.

     

    
      	
              4.5.

            	
              No
                Conflict; Required Filings and Consents.
                The execution and delivery of this Agreement by the Company does
                not, and
                the performance by the Company of its obligations hereunder will
                not: (i)
                conflict with or violate the Company’s Governing Documents;
                (ii)
                conflict with, breach or violate any federal, state, foreign or local
                law,
                statute, ordinance, rule, regulation, order, judgment or decree
                (collectively, “Laws”)
                in effect as of the date of this Agreement and applicable to the
                Company;
                or (iii) result in any breach of, constitute a default (or an event
                that
                with notice or lapse of time or both would become a default) under,
                give
                to any other entity any right of termination, amendment, acceleration
                or
                cancellation of, require payment under, or result in the creation
                of a
                lien or encumbrance on any of the properties or assets of the Company
                pursuant to, any note, bond, mortgage, indenture, contract, agreement,
                lease, license, permit, franchise or other instrument or obligation
                to
                which the Company is a party or by the Company or
                any
                of its properties or assets is bound other than violations, conflicts,
                breaches, defaults, terminations, accelerations, creations of liens,
                or
                incumbency that would not, in the aggregate, have a Material Adverse
                Effect
                except to the extent that stockholder approval may be required as
                a result
                of the Authorized Stock Proviso, in which event, the Company will
                seek
                stockholder approval to an increase in the authorized Common Stock
                sufficient to enable the Company to be in compliance with this Section
                4.5.

            

    

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
        Page-11

        
          

        

      

      
        
        

      

    

     

    
      	4.6.	
              Report
                and Financial Statements.

            

    

     

    4.6.1. The
      Company has delivered to the Investor
      its
      audited balance sheet as of December 31, 2005 and the audited statements of
      operations, stockholders equity and cash flows for the years ended December
      31,
      2005 and 2004, and the unaudited balance sheet as of June 30, 2006 and unaudited
      statements of operations and cash flows for the six months ended June 30, 2006
      and 2005 and stockholders’ equity for the six months ended June 30,
      2006,
      in each case including notes to the financial statements (collectively, the
      “Financial Statements”). Each of the balance sheets contained in such Financial
      Statements (including the related notes and schedules thereto) fairly presented
      the financial position of the Company, as of its date, and each of the
      statements of operations, stockholders’ equity and cash flows in such Financial
      Statements (including any related notes and schedules thereto) fairly presents,
      the results of operations, changes in stockholders’ equity and changes in cash
      flows, as the case may be, of the Company, for the periods to which they relate,
      in each case in accordance with GAAP, except in each case as may be noted
      therein, subject to normal year-end audit adjustments in the case of unaudited
      statements. The books and records of the Company have been, and are being,
      maintained in all material respects in accordance with GAAP and any other
      applicable legal and accounting requirements and reflect only actual
      transactions.
       Peter
      C.
      Cosmas Co. CPA’s,
      who
      audited the 2005 audited financial statements, is independent within the meaning
      of the regulations of the SEC.

     

    4.6.2. Peter
      C.
      Cosmas Co. CPA’s has
      not
      issued any management letter in connection with its audit of the Company’s
      audited Financial Statements for 2005 or 2004. 

     

    
      	
              4.7.

            	
              Compliance
                with Applicable Laws.
                The Company is not in violation of, or, to the knowledge of the Company,
                is under investigation with respect to or has been given notice or
                has
                been charged with the violation of any Laws, except for violations
                which
                individually or in the aggregate do not have a Material Adverse Effect.
                

            

    

     

    
      	
              4.8.

            	
              Brokers.
                No broker, finder or investment banker is entitled to any brokerage,
                finder’s or other fee or commission in connection with the transactions
                contemplated by this Agreement based upon arrangements made by or
                on
                behalf of the Company, except as set forth in Schedule 4.8 to this
                Agreement.

            

    

     

    
      	
              4.9.

            	
              SEC
                Documents.
                The Company is
                a publicly held company and it has made available to the Investor
                true and
                complete copies of any requested SEC Documents. The Company has registered
                its Common Stock pursuant to Section 12(g) of the 1934 Act. The
                Common Stock is quoted and traded on the OTC Bulletin Board. The
                Company
                has received no notice, either oral or written, with respect to the
                continued quotation or trading of the Common Stock on the OTC Bulletin
                Board. The
                Company has not provided to the Investor any information that, according
                to applicable law, rule or regulation, should have been disclosed
                publicly
                prior to the date hereof by the Company, but which has not been so
                disclosed. As
                of their respective dates, the SEC Documents complied in all material
                respects with the requirements of the 1934 Act, and rules and regulations
                of the SEC promulgated thereunder and the SEC Documents did not contain
                any untrue statement of a material fact or omit to state a material
                fact
                required to be stated therein or necessary in order to make the statements
                therein, in light of the circumstances under which they were made,
                not
                misleading.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-12

        
          

        

      

      
        
        

      

    

     

    
      	
              4.10.

            	
              Litigation.
                To the knowledge of the Company, no litigation, claim, or other proceeding
                before any court or governmental agency is pending or to the knowledge
                of
                the Company, threatened against the Company, the prosecution or outcome
                of
                which, if adversely determined, is likely to have a Material Adverse
                Effect.

            

    

     

    
      	
              4.11.

            	
              Exemption
                from Registration.
                Subject to the accuracy of the Investor’s representations in Article V,
                except as required pursuant to the Registration Rights Agreement,
                the sale
                of the Securities by the Company to the Investor will not require
                registration under the 1933 Act. When validly converted in accordance
                with
                the terms of the Note and the Series A Preferred Stock, and upon
                exercise
                of the Warrants in accordance with their terms, the Shares underlying
                the
                Series A Preferred Stock and the Warrants will be duly and validly
                issued,
                fully paid, and non-assessable, subject to the qualification set
                forth in
                Section 4.3.4 of this Agreement. The Company is issuing the Note,
                and,
                upon conversion of the Note, the Series A Preferred Stock, and the
                Warrants in accordance with and in reliance upon the exemption from
                securities registration afforded, inter alia, by Rule 506 under Regulation
                D as promulgated by the SEC under the 1933 Act, and/or Section 4(2)
                of the
                1933 Act; provided, however, that certain filings and registrations
                may be
                required under state securities “blue sky” laws depending upon the
                residency of the Investor.

            

    

     

    
      	
              4.12.

            	
              No
                General Solicitation or Advertising in Regard to this
                Transaction.
                Neither the Company nor any of its Affiliates nor, to the knowledge
                of the
                Company, any Person acting on its or their behalf (i) has conducted
                or
                will conduct any general solicitation (as that term is used in Rule
                502(c)
                of Regulation D as promulgated by the SEC under the 1933 Act) or
                general
                advertising with respect to the sale of the Series A Preferred Stock
                or
                Warrants, or (ii) made any offers or sales of any security or solicited
                any offers to buy any security under any circumstances that would
                require
                registration of the Series A Preferred Stock or Warrants, under the
                1933
                Act, except as required herein.

            

    

     

    
      	
              4.13.

            	
              No
                Material Adverse Effect.
                Since March 31, 2006, no
                event or circumstance resulting in a Material Adverse Effect has
                occurred
                or exists with respect to the Company. No material supplier or customer
                has given notice, oral or written, that it intends to cease or reduce
                the
                volume of its business with the Company from historical levels. Since
                March 31, 2006, no event or circumstance has occurred or exists with
                respect to the Company or its businesses, properties, prospects,
                operations or financial condition, that, under any applicable law,
                rule or
                regulation, requires public disclosure or announcement prior to the
                date
                hereof by the Company but which has not been so publicly announced
                or
                disclosed in writing to the
                Investor.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-13

        
          

        

      

      
        
        

      

    

     

    
      	
              4.14.

            	
              Material
                Non-Public Information.
                The Company has not disclosed to either Investor any material non-public
                information that (i) if disclosed, would reasonably be expected to
                have a
                material effect on the price of the Common Stock or (ii) according
                to
                applicable law, rule or regulation, should have been disclosed publicly
                by
                the Company prior to the date hereof but which has not been so disclosed;
                provided, however, that the Company has disclosed to the Investor
                matters
                relating to the Company’s acquisition of RTI and the terms of such
                acquisition.

            

    

     

    
      	
              4.15.

            	
              Internal
                Controls And Procedures.
                To the knowledge
                of the Company, the Company maintains books and records and internal
                accounting controls which provide reasonable assurance that (i) all
                transactions to which the Company or any subsidiary is a party or
                by which
                its properties are bound have been executed with management’s
                authorization; (ii) the recorded accounting of the Company’s and its
                subsidiaries’ assets is compared with existing assets at regular
                intervals; (iii) access to the Company’s and its subsidiaries’ assets is
                permitted only in accordance with management’s authorization; and (iv) all
                transactions to which the Company or any subsidiary is a party or
                by which
                its properties are bound are recorded as necessary to permit preparation
                of the consolidated financial statements of the Company in accordance
                with
                United States generally accepted accounting principals; it
                being understood that the Company has
                not conducted an internal controls audit and that no such audit has
                been
                required under applicable law.

            

    

     

    
      	
              4.16.

            	
              Full
                Disclosure.
                No representation or warranty made by the
                Company in
                this Agreement and no certificate or document furnished or to be
                furnished
                to the Investor pursuant to this Agreement contains or will contain
                any
                untrue statement of a material fact, or omits or will omit to state
                a
                material fact necessary to make the statements contained herein or
                therein, taken as a whole, not
                misleading.

            

    

     

    ARTICLE
      V

     

    REPRESENTATIONS
      AND WARRANTIES OF THE INVESTOR

     

    The
      Investor represents and warrants to the Company that:

    

    
      	
              5.1.

            	
              Organization
                and Standing of the Investor.
                The Investor is
                a limited partnership duly formed, validly existing and in good standing
                under the laws of the State of Delaware. The
                Investor was not formed for the purpose of investing solely in the
                Securities. The execution, delivery and performance of this Agreement
                by
                the Investor and the consummation by the Investor of the transactions
                contemplated hereby have been duly authorized by all necessary partnership
                action where appropriate. The
                state in which any offer to purchase the Securities was made or accepted
                by the Investor is the state shown as the Investor’s address.
                

            

    

     

    
      	
              5.2.

            	
              Authorization
                and Power.
                The Investor has the requisite power and authority to enter into
                and
                perform this Agreement and to purchase the Securities being sold
                to it
                hereunder. This Agreement and the Registration Rights Agreement have
                been
                duly executed and delivered by the Investor and at the Closing shall
                constitute valid and binding obligations of the Investor enforceable
                against the Investor in accordance with their terms, except as such
                enforceability may be limited by applicable bankruptcy, insolvency,
                reorganization, moratorium, liquidation, conservatorship, receivership
                or
                similar laws relating to, or affecting generally the enforcement
                of,
                creditors’ rights and remedies or by other equitable principles of general
                application.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-14

        
          

        

      

      
        
        

      

    

     

    
      	
              5.3.

            	
              No
                Conflicts.
                The execution, delivery and performance of this Agreement and the
                consummation by the Investor of the transactions contemplated hereby
                or
                relating hereto do not and will not (i) result in a violation of
                the
                Investor’s charter documents or bylaws where appropriate or (ii) conflict
                with, or constitute a default (or an event which with notice or lapse
                of
                time or both would become a default) under, or give to others any
                rights
                of termination, amendment, acceleration or cancellation of any agreement,
                indenture or instrument to which the Investor is a party, or result
                in a
                violation of any law, rule, or regulation, or any order, judgment
                or
                decree of any court or governmental agency applicable to the Investor
                or
                its properties (except for such conflicts, defaults and violations
                as
                would not, individually or in the aggregate, have a Material Adverse
                Effect on the Investor). The Investor is not required to obtain any
                consent, authorization or order of, or make any filing or registration
                with, any court or governmental agency in order for it to execute,
                deliver
                or perform any of the Investor’s obligations under this Agreement or to
                purchase the securities from the Company in accordance with the terms
                hereof, provided that for purposes of the representation made in
                this
                sentence, the Investor is assuming and relying upon the accuracy
                of the
                relevant representations and agreements of the Company
                herein.

            

    

     

    
      	
              5.4.

            	
              Financial
                Risks.
                The Investor acknowledges that the Investor is able to bear the financial
                risks associated with an investment in the securities being purchased
                by
                the Investor from the Company and that it has been given full access
                to
                such records of the Company and the subsidiaries and to the officers
                of
                the Company and the subsidiaries as it has deemed necessary or appropriate
                to conduct its due diligence investigation. The Investor is capable
                of
                evaluating the risks and merits of an investment in the securities
                being
                purchased by the Investor from the Company by virtue of its experience
                as
                an investor and its knowledge, experience, and sophistication in
                financial
                and business matters and the Investor is capable of bearing the entire
                loss of its investment in the securities being purchased by the Investor
                from the Company.

            

    

     

    
      	
              5.5.

            	
              Accredited
                Investor.
                The Investor is (i) an “accredited investor” as that term is defined in
                Rule 501 of Regulation D promulgated under the 1933 Act by reason
                of Rule
                501(a)(3) and (6), (ii) experienced in making investments of the
                kind
                described in this Agreement and the related documents, (iii) able,
                by
                reason of the business and financial experience of its officers (if
                an
                entity) and professional advisors (who are not affiliated with or
                compensated in any way by the Company or any of its affiliates or
                selling
                agents), to protect its own interests in connection with the transactions
                described in this Agreement, and the related documents, and (iv)
                able to
                afford the entire loss of its investment in the securities being
                purchased
                by the Investor from the Company. The Investor is acquiring the Securities
                for investment and not with a view to the sale or distribution thereof
                and
                understands that such Securities are restricted securities, as defined
                in
                the 1933 Act, and may not be sold or otherwise distributed except
                pursuant
                to an effective registration statement or an exemption from the
                registration requirements of the 1933 Act and that the certificates
                for
                such securities shares and Warrants will bear an investment
                legend.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-15

        
          

        

      

      
        
        

      

    

     

    
      	
              5.6.

            	
              Brokers.
                No broker, finder or investment banker is entitled to any brokerage,
                finder’s or other fee or commission in connection with the transactions
                contemplated by this Agreement based upon arrangements made by or
                on
                behalf of the Investor, except as set forth on Schedule 4.8, it being
                understood that the compensation payable to the brokers listed on
                such
                Schedule 4.8 are payable by the
                Company.

            

    

     

    
      	
              5.7.

            	
              Knowledge
                of Company.
                The Investor and its advisors, if any, have been, upon request, furnished
                with all materials relating to the business, finances and operations
                of
                the Company and materials relating to the offer and sale of the securities
                being purchased by the Investor from the Company. The Investor and
                its
                advisors, if any, have been afforded the opportunity to ask questions
                of
                the Company and have received complete and satisfactory answers to
                any
                such inquiries.

            

    

     

    
      	
              5.8.

            	
              Risk
                Factors.
                The Investor understands that the investment by the Investor in the
                Securities being purchased by the Investor from the Company involves
                a
                high degree of risk. The Investor understands that no United States
                federal or state agency or any other government or governmental agency
                has
                passed on or made any recommendation or endorsement of the securities
                being purchased by the Investor from the Company. The Investor warrants
                that it is able to bear the complete loss of its investment in the
                securities being purchased by it from the Company. In acquiring the
                Securities, the Investor is not relying upon any projections of the
                future
                financial condition, results of operations or cash flows relating
                to the
                Company.
                The Investor acknowledges and agrees that (a) it has had the opportunity
                to obtain, and it has reviewed and discussed with the Company, to
                the
                extent that it deems necessary, information concerning the Company,
                including risks relating to the Company and its financial statements,
                and
                that (b) in entering into and performing this Agreement, the Investor
                has
                not relied on any oral representations made by the Company or any
                of its
                agents, representatives or
                advisors.

            

    

     

    
      	
              5.9.

            	
              Full
                Disclosure.
                No representation or warranty made by the Investor in this Agreement
                and
                no certificate or document furnished or to be furnished to the Company
                pursuant to this Agreement contains or will contain any untrue statement
                of a material fact, or omits or will omit to state a material fact
                necessary to make the statements contained herein or therein not
                misleading. Except as set forth or referred to in this Agreement,
                (a) the
                Investor does not have any agreement or understanding with any person
                relating to acquiring, holding, voting or disposing of any equity
                securities of the Company, and (b) during the past five years there
                has
                not occurred any event listed in Item 401(f) of Regulation S-K or
                any
                investigation relating to any such event with respect to the Investor
                or
                any of its managing partners. 

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-16

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      VI

     

    COVENANTS
      OF THE COMPANY

     

    
      	
              6.1.

            	
              Registration
                Rights.
                The Company shall cause the Registration Rights Agreement to remain
                in
                full force and effect and shall comply in all material respects with
                the
                terms thereof.

            

    

     

    
      	
              6.2.

            	
              Reservation
                of Common Stock.
                As of the date hereof, the Company has reserved and the Company shall
                continue to reserve and keep available at all times, free of preemptive
                rights, shares of Common Stock for the purpose of enabling the Company
                to
                issue the Shares underlying the Note or the Series A Preferred Stock,
                as
                the case may be, and the Warrants;
                provided, however, that if, as a result of the Authorized Stock Proviso,
                there are not sufficient shares reserved as required in this Section
                6.2,
                the Company shall, within thirty (30) days after the Company becomes
                aware
                of such deficiency, prepare and file with the SEC a proxy statement
                pursuant to which the Company will seek stockholder approval for
                an
                increase in the authorized Common Stock sufficient to enable the
                Company
                to be in compliance with this Section 6.2. The Investor agrees to
                vote in
                favor of such proposal.

            

    

     

    
      	
              6.3.

            	
              Compliance
                with Laws.
                The Company hereby agrees to comply in all material respects with
                the
                Company’s reporting, filing and other obligations under the federal
                securities laws.

            

    

     

    
      	
              6.4.

            	
              1934
                Act Registration and Compliance.
                The Company will use its best efforts to comply in all respects with
                its
                reporting and filing obligations under the 1934 Act, and will not
                take any
                action or file any document (whether or not permitted by the 1934
                Act or
                the rules thereunder) to terminate or suspend any such registration
                or to
                terminate or suspend its reporting and filing obligations under the
                1934
                until the Investor has disposed of all of its Shares or to cause
                the
                trading of the Common Stock on the OTC Bulletin Board to be suspended
                or
                terminated other than as a result of a change in the standards or
                requirements for such trading. In the event that the Common Stock
                is
                traded in a market which does not require the Company to be current
                in its
                reporting requirement under the 1934 Act, the Company shall, nonetheless,
                continue to file all reports required to be filed by a reporting
                company.
                If for any reason, the Company’s common stock is not a reporting company
                pursuant to the 1934 Act, the Company shall pay the Investor, as
                liquidated damages, an amount at the rate of twenty-four percent
                (24%) per
                annum, of the Purchase Price of the principal amount of the Note
                or the
                shares of Series A Preferred Stock (or shares of Common Stock issued
                upon
                conversion of the Series A Preferred Stock) that are then owned by
                the
                Investor. Such payment shall be made in cash or in shares of Series
                A
                Preferred Stock, as the Investor shall elect, with the payment of
                the
                Series A Preferred Stock being based on the Purchase Price. The liquidated
                damages shall be paid on a per diem basis, for each day during which
                the
                Company fails to be in compliance with this Section
                6.4.

            

    

     

    
      	
              6.5.

            	
              Corporate
                Existence; Conflicting Agreements.
                The Company will take all steps necessary to preserve and continue
                the
                corporate existence of the Company. The Company shall not enter into
                any
                agreement, the terms of which agreement would restrict or impair
                the right
                or ability of the Company to perform any of its obligations under
                this
                Agreement or any of the other agreements attached as exhibits hereto.
                

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-17

        
          

        

      

      
        
        

      

    

     

    
      	
              6.6.

            	
              Series
                A Preferred Stock.
                Until the earliest of (a) three years from the Closing or (b) such
                date as
                the Investor shall have converted the Note or the Series A Preferred
                Stock
                into not less than 90% of the Total Shares sold the underlying Shares
                or
                (c) such date as the Investor shall have transferred the Note or
                the
                Series A Preferred Stock which are convertible into an aggregate
                of not
                less than 90% of the Total Shares, the Company will not issue any
                preferred stock of with the exception of Series A Preferred Stock
                issued
                to the Investor as provided in this Agreement and the Registration
                Rights
                Agreement. 

            

    

     

    
      	
              6.7.

            	
              Convertible
                Debt.
                On or prior to the Closing Date, the Company will cause to be cancelled
                all convertible debt in the Company. Until the earliest of (a) three
                years
                from the Closing or (b) such date as the Investor shall have converted
                the
                Note or the Series A Preferred Stock into not less than 90% of the
                Total
                Shares sold the underlying Shares or (c) such date as the Investor
                shall
                have transferred the Note or the Series A Preferred Stock which are
                convertible into an aggregate of not less than 90% of the Total Shares,
                the Company will not issue any convertible debt.
                

            

    

     

    
      	
              6.8.

            	
              Debt
                Limitation.
                The Company agrees that, for two years after Closing, neither it
                nor its
                consolidated subsidiaries, shall permit outstanding indebtedness,
                based on
                the principal amount outstanding at the end of a calendar quarter,
                to be
                more than two times the sum of the EBITDA from continuing operations
                over
                the four quarters ending on such date. Indebtedness shall include
                any
                liabilities or obligations which, under GAAP, are reflected as
                indebtedness on the Company’s consolidated balance
                sheet.

            

    

     

    
      	
              6.9.

            	
              Reset
                Equity Deals.
                On or prior to the Closing Date, the Company will cause to be cancelled
                any and all reset features related to any shares outstanding that
                could
                result in additional shares being issued. For a period of three years
                from
                the Closing the Company will not enter into any transactions that
                have any
                reset features that could result in additional shares being issued.
                For
                purposes of this Section 6.9, a reset provision for a convertible
                security
                or derivative security shall mean a provision (a) whereby the issuance
                of
                securities at a lower price or having a lower conversion or exercise
                price
                will result in the conversion or exercise price of the security being
                reduced to the lower price or lower conversion or exercise price
                or more
                shares being issued, as the case may be, or (b) which provide that
                the
                conversion or exercise price is based on the market price at the
                time of
                conversion or exercise or (c) any other device which results in an
                adjustment to the exercise price or conversion price of the securities
                other than stock dividends, stock splits, stock distributions, combination
                of shares, reverse splits, and other recapitalizations, as long as
                they
                effect all stockholders
                appropriately.

            

    

     

    
      	
              6.10.

            	
              Independent
                Directors.

            

    

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
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    6.10.1. The
      Company shall have caused the appointment of the majority of the board of
      directors to be independent directors, as defined by the rules
      of
      the Nasdaq Stock Market, not later than forty five (45) days after the Closing
      Date.

     

    6.10.2. If,
      at
      any time subsequent to the expiration of forty five (45) days after the Closing
      Date until the earlier of (a) three years from the Closing or (b) such date
      as
      the Investor shall have converted not less than 90% of the Convertible
      Securities and sold the underlying Shares or (c) such date as the Investor
      shall
      have transferred not less than 90% of the Convertible Securities or (d)
such
      date
      as the total number or principal amount of Convertible Securities which the
      Investor shall have either transferred or converted and sold the underlying
      Shares shall represent not less than 90% of Shares issuable upon conversion
      of
      the Convertible Securities issued to the Investor,
      the
      board of directors shall not be composed of a majority of independent
      directors:

     

    6.10.2.1.
      for a
      reason other than for an Excused Reason, the Company shall have sixty (60)
      days
      to take such steps as are necessary so that a majority of the Company’s
      directors are independent directors, and

     

    6.10.2.2.
      for an
      Excused Reason, the Company shall have seventy five (75) days from the date
      that
      the Company becomes aware of the event (or the last event if there are more
      than
      one such event) giving rise to the Excused Reason, to take such steps as are
      necessary so that a majority of the Company’s directors are independent
      directors.

     

    6.10.3. The
      term
“Excused
      Reason”
shall
      mean the death or resignation of an independent director or the occurrence
      of an
      event whereby an independent director ceases to be independent.

     

    6.10.4. If,
      during the period referred to in Section 6.10.2 of this Agreement, the Company
      shall have failed to have a board of directors composed of a majority of
      independent directors after the date by which such situation was to have been
      cured pursuant to Section 6.10.2.1 or Section 6.10.2.2 of this Agreement,
      whichever shall apply, the Company shall pay to the Investor, as liquidated
      damages and not as a penalty, an amount equal to twenty percent (20%) per annum
      of the Purchase Price of the then outstanding shares of Series A Preferred
      Stock
      or principal amount of the Note, as the case may be, payable monthly in cash
      or
      Series A Preferred Stock at the option of the Investor, based on the number
      of
      days that such condition exists beyond the applicable grace period; provided,
      however, that if the Restated Certificate shall not have been filed, the Company
      may issue a Note in lieu of shares of Series A Preferred Stock pursuant to
      this
      Section 6.10 and Section 6.11 of this Agreement. The parties agree that the
      only
      damages payable for a violation of such provisions shall be such liquidated
      damages. Nothing shall preclude the Investor from pursuing or obtaining specific
      performance or other equitable relief with respect to this Agreement. The
      parties hereto agree that the liquidated damages provided for in this Section
      6.10.4 constitute a reasonable estimate of the damages that may be incurred
      by
      the Investor by reason of the failure of the Company to have a majority of
      directors as independent directors.

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-19

        
          

        

      

      
        
        

      

    

     

    6.10.5. In
      no
      event shall the total payments made pursuant to this Section 6.10 and Section
      6.11, whether in cash or Series A Preferred Stock exceed in the aggregate twenty
      percent (20%) of the Purchase Price of the shares of Series A Preferred Stock
      or
      principal amount of the Note, as the case may be, that are outstanding as of
      the
      date on which a computation is being made.

     

    
      	
              6.11.

            	
              Independent
                Directors on Audit and Compensation Committees.
                No later than forty five (45) days the Closing Date, the Company
                will have
                an audit committee comprised solely of not less than three independent
                directors and a compensation committee comprised of not less than
                three
                directors, a majority of whom are independent directors. If at any
                time
                after the subsequent to the Closing Date, independent directors do
                not
                comprise all of the members of the audit committee and a majority
                of the
                members of the compensation committee within the grace periods provided
                in
                Section 6.10, the Company shall pay to the Investor, as liquidated
                damages
                and not as a penalty, an amount equal to twenty percent (20%) per
                annum of
                the Purchase Price of the then outstanding Series A Preferred Stock
                or
                principal amount of the Note, as the case may be, payable monthly
                in cash
                or Series A Preferred Stock at the option of the Investor, such payment
                shall be based on the number of days that such condition exists.
                The
                parties agree that the only damages payable for a violation of the
                terms
                of this Agreement with respect to which liquidated damages are expressly
                provided shall be such liquidated damages. Nothing shall preclude
                the
                Investor from pursuing other remedies or obtaining specific performance
                or
                other equitable relief with respect to this Agreement. Notwithstanding
                the
                foregoing, no liquidated damages shall be payable pursuant to this
                Section
                6.11 during any period for which liquidated damages are payable pursuant
                to Section 6.10.

            

    

     

    
      	6.12.	
              Use
                of Proceeds.
                The Company will use the
                net
                proceeds
                from the sale of the Note and the Warrants (excluding amounts paid
                by the
                Company for legal and administrative fees and
                other expenses of the transaction) for
                working capital and the acquisition of RTI (of which $1,500,000 shall
                be
                held in escrow as provided in the RTI Agreement) and the payment
                of
                $500,000 to Laurus. 

            

    

     

    
      	6.13.	
              Right
                of First Refusal

            

    

     

    6.13.1. In
      the
      event that the Company seeks to raise additional funds through a private
      placement of its securities (a “Proposed
      Financing”),
      other
      than Exempt Issuances, the Investor shall have the right to participate in
      any
      subsequent funding by the Company of the offering price on a pro rata basis,
      based on the percentage that (a) the number of the Investor’s Total Shares,
      without regard to the 4.9% Limitation, bears to (b) the total number of shares
      of Common Stock outstanding plus the number of Shares issuable upon conversion
      of the Note or Series A Preferred Stock, as the case may be, and any other
      series of convertible preferred stock or debt securities, without regard to
      the
      4.9% Limitations any other limitations on exercise such other convertible
      preferred stock or debt securities. This Section 6.14 shall apply to each such
      offering based on the total purchase price of the securities being offered
      by
      the Company.

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
        Page-20

        
          

        

      

      
        
        

      

    

     

    6.13.2. The
      terms
      on which the Investor shall purchase securities pursuant to Proposed Financing
      shall be the same as such securities are purchased by other investors. The
      Company shall give the Investor the opportunity to participate in the offering
      by giving the Investor not less than ten (10) days notice setting forth the
      terms of the Proposed Financing. In the event that the terms of the Proposed
      Financing are changed in a manner which is more favorable to the potential
      investor, the Company shall provide the Investor, at the same time as the notice
      is provided to the other potential investors, with a new ten (10) day notice
      setting forth the revised terms that are provided to the other potential
      investors.

     

    6.13.3. In
      the
      event that the Investor does not exercise its right to participate in the
      Proposed Financing within the time limits set forth in Section 6.14.2 of this
      Agreement, the Company may sell the securities in the Proposed Financing at
      a
      price and on terms which are no more favorable to the investors than the terms
      provided to the Investor. If the Company subsequently changes the price or
      terms
      so that the price is more favorable to the investors or so the terms are more
      favorable to the investors, the Company shall provide the Investor with the
      opportunity to purchase the securities on the revised terms in the manner set
      forth in Section
      6.14.2
      of this
      Agreement.

     

    
      	6.14.	
              Price
                Adjustment.
                From the date hereof until such time as the Investor holds no Securities,
                except for Exempt Issuances, as to which this Section
                6.14
                does not apply, if the Company closes on the sale or issuance of
                Common
                Stock at a price, or warrants, options, convertible
                debt or equity securities with a exercise price per share or exercise
                price per share which is less than the Conversion Price then in effect
                (such lower sales price, conversion or exercise price, as the case
                may be,
                being referred to as the “Lower Price”), the Conversion Price in effect
                from and after the date of such transaction shall be reduced to the
                Lower
                Price. For purpose of determining the exercise price of warrants
                issued by
                the Company, the price, if any, paid per share for the warrants shall
                be
                added to the exercise price of the warrants. A similar provision
                shall be
                included in the Warrants.

            

    

     

    
      	6.15.	
              Price
                Adjustments Based on EBITDA Per
                Share.

            

    

     

    6.15.1. The
      Certificate of Designation shall contain the following provisions, and similar
      provisions shall be included in the Warrants.

     

    6.15.2. In
      the
      event the Company’s consolidated EBITDA for the year ended December 31, 2006 is
      less than $.0019 per share on a fully-diluted basis, then the Conversion Price
      shall be reduced by the percentage shortfall, up to a maximum of 30%. Thus,
      if
      EBITDA per share for the year ended December 31, 2006 is $.00133 per share
      on a
      fully-diluted basis, the Conversion Price shall be reduced by 30%. Such
      reduction shall be made at the time the Company files its Form 10-KSB for the
      year ended December 31, 2006, and shall apply to the Note or all shares of
      the
      Series A Preferred Stock, as the case may be, which are outstanding on the
      date
      the Form 10-KSB is filed, or, if not filed on time, on the date that filing
      was
      required. For purpose of this Section 6.15, EBITDA shall be based on net income
      plus (a)
      any
      charges relating to the transaction contemplated by this Agreement, the Note
      and
      the Registration Rights Agreement
      plus (b)
      any non-recurring items other than those referred to in clause (c) of this
      Section 6.15.2, minus (c) any Earn-Out Payment, as defined in the RTI Agreement,
      or comparable payments to the former stockholders of RTI which, in the
      aggregate, are in excess of $750,000. 

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
        Page-21

        
          

        

      

      
        
        

      

    

     

    6.15.3. In
      the
      event the Company’s consolidated EBITDA for the year ended December 31, 2007 is
      less than $.00549 per share on a fully-diluted basis, then the Conversion Price
      shall be reduced by the percentage shortfall, up to a maximum of 30%. Thus,
      if
      EBITDA for the year ended December 31, 2007 is $.003843 per share on a
      fully-diluted basis, the Conversion Price shall be reduced by 30%. Such
      reduction shall be made at the time the Company files its Form 10-KSB for the
      year ended December 31, 2007, and shall apply to the Note or all shares of
      the
      Series A Preferred Stock, as the case may be, which are outstanding on the
      date
      the Form 10-KSB is filed, or, if not filed on time, on the date that filing
      was
      required. 

     

    6.15.4. For
      purpose of determining EBITDA Per Share on a fully-diluted basis, all shares
      of
      Common Stock issuable upon conversion of convertible securities and upon
      exercise of warrants and options shall be deemed to be outstanding, regardless
      of whether (i) such shares are treated as outstanding for determining diluted
      earnings per share under GAAP, (ii) such securities are “in the money,” or (iii)
      such shares may be issued as a result of the 4.9% Limitation. The per share
      amounts set forth in Sections 6.15.2 and 6.15.3 of this Agreement shall be
      adjusted in accordance with GAAP to reflect any stock dividend, split,
      distribution, reverse split or combination of shares or other
      recapitalization.

     

    
      	6.16.	
              Insider
                Selling.
                The earliest any Restricted Stockholders can start selling their
                shares of
                Common Stock in the public market shall be twenty four (24) months
                from
                the Closing Date. Restricted Stockholders shall include all persons
                who
                are officers and directors of the Company and all persons who are,
                as of
                the date hereof, officers or directors of RTI and their spouses.
                Andrew
                Barron Worden and the Investor shall not be considered Restricted
                Stockholders. The restrictions in this Section 6.16 shall not apply
                to
                shares issued pursuant to a stock option or long-term incentive plans
                which may be approved by the Compensation Committee provided that
                such
                committee is comprises of a majority of independent directors. The
                Company
                may include in such registration statement shares of Common Stock
                held by
                former stockholders of RTI who were not officers or directors of
                RTI
                during the three months prior to the Closing Date; provided, however,
                that, if, in order for the registration statement to be declared
                effective
                by the SEC, it is necessary to reduce the number of shares covered
                by the
                registration statement, all of the shares being sold by such former
                RTI
                stockholders shall be excluded prior to any reduction in the shares
                being
                sold by the Investor. 

            

    

     

    
      	6.17.	
              Employment
                and Consulting Contracts.
                For three years after the Closing, Company must have a unanimous
                approval
                from the Compensation Committee of the Board of Directors having
                reached a
                conclusion that any awards other than salary are usual, appropriate
                and
                reasonable for any officer, director or consultants whose compensation
                is
                more than $100,000 per annum. This Section 6.17 does not apply to
                attorneys, accountants and other persons who provide professional
                services
                to the Company.

            

    

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
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      	6.18.	
              Subsequent
                Equity Sales.
                From the date hereof until such time as the Investor hold no more
                than 5%
                of the Shares (determined as if the Note and Series A Preferred Stock
                were
                fully converted and the Warrants fully exercised), the Company shall
                be
                prohibited from effecting or entering into an agreement to effect
                any
                Subsequent Financing involving a “Variable
                Rate Transaction”
                or an “MFN
                Transaction”
                (each as defined below). The term “Variable
                Rate Transaction”
                shall mean a transaction in which the Company issues or sells (i)
                any debt
                or equity securities that are convertible into, exchangeable or
                exercisable for, or include the right to receive additional shares
                of
                Common Stock either (A) at a conversion, exercise or exchange rate
                or
                other price that is based upon and/or varies with the trading prices
                of or
                quotations for the shares of Common Stock at any time after the initial
                issuance of such debt or equity securities, or (B) with a conversion,
                exercise or exchange price that is subject to being reset at some
                future
                date after the initial issuance of such debt or equity security or
                upon
                the occurrence of specified or contingent events directly or indirectly
                related to the business of the Company or the market for the Common
                Stock.
                The term “MFN
                Transaction”
                shall mean a transaction in which the Company issues or sells any
                securities in a capital raising transaction or series of related
                transactions which grants to an investor the right to receive additional
                shares based upon future transactions of the Company on terms which
                are
                more favorable to the Investor than the terms initially provided
                to the
                investor in its initial securities purchase agreement with the Company.
                The Investor shall be entitled to obtain injunctive relief against
                the
                Company to preclude any such issuance, which remedy shall be in addition
                to any right to collect damages. Notwithstanding the foregoing, this
                Section 6.18 shall not apply in respect of an Exempt Issuance, except
                that
                no Variable Rate Transaction or MFN Transaction shall be an Exempt
                Issuance.

            

    

     

    
      	6.19.	
              Approval
                of Restated Certificate.
                The Company shall obtain stockholder approval of the Restated Certificate
                and the file the Restated Certificate not later than one hundred
                twenty
                (120) from the Closing Date. In the event that the Restated Certificate
                is
                not filed with the Secretary of State of the State of Delaware within
                one
                hundred fifty days (150) from the Closing Date, then for each whole
                or
                partial month that elapses between the 150th
                day from the Closing Date and the date of such filing, the Conversion
                Price, then in effect of the Note and the Series A Preferred Stock
                (as
                defined in the Note and the Certificate of Designations) and the
                Exercise
                Price of the Warrants (as defined the Warrants) shall automatically
                be
                reduced by 6%. 

            

    

     

    
      	6.20.	
              Stock
                Splits.
                All forward and reverse stock splits shall affect all equity and
                derivative holders proportionately.

            

    

     

    
      	6.21.	
              No
                Disclosure of Material Non-Public Information.
                The Company will not disclose to the Investor any material non-public
                information concerning the Company except (a) with the consent of
                Investor
                and (b) if such consent is given, pursuant to a non-disclosure agreement
                which provides, among other things, that the Investor will not disclose
                the material non-public information to any person and the Investor
                will
                not engage in any transactions involving the Company’s securities while in
                possession of material non-public information. 

            

    

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
        Page-23

        
          

        

      

      
        
        

      

    

     

    
      	6.22.	
              Payment
                of Due Diligence Expenses.
                At Closing the Escrow Agent shall disperse to the Barron Fifty Thousand
                Dollars ($50,000.00) for due diligence, legal and any other expenses
                which
                the Investor may incur in connection with this
                Agreement.

            

    

     

    ARTICLE
      VII

     

    COVENANTS
      OF THE INVESTORS

    

    
      	
              7.1.

            	
              Compliance
                with Law.
                The Investor covenants that its trading activities with respect to
                shares
                of the Company’s Common Stock will be in compliance with all applicable
                state and federal securities laws, rules and regulations and rules
                and
                regulations of any public market on which the Company’s Common Stock is
                listed. 

            

    

     

    
      	
              7.2.

            	
              Transfer
                Restrictions.
                The Investor acknowledges that (a) the Note, and Warrants and shares
                of
                Series A Preferred Stock and Common Stock issuable upon conversion
                of the
                Note and Series A Preferred Stock or upon exercise of the Warrants
                have
                not been registered under the 1933 Act, and may not be transferred
                unless
                (i) they are subject to a current and effective registration statement
                under the 1933 Act, or (ii) the Investor shall have delivered to
                the
                Company an opinion of counsel, which counsel and opinion shall be
                reasonably satisfactory to the Company, to the effect that the Securities
                to be sold or transferred may be sold or transferred pursuant to
                an
                exemption from such registration; and (b) any sale of the Securities
                made
                in reliance on Rule 144 promulgated under the 1933 Act may be made
                only in
                accordance with the terms of said Rule, to the extent that such Rule
                is
                applicable.

            

    

     

    
      	
              7.3.

            	
              Restrictive
                Legend.
                The Investor acknowledges and agrees that the Securities and the
                Shares
                shall bear a restrictive legend and a stop-transfer order may be
                placed
                against transfer of any such Securities except that the requirement
                for a
                restrictive legend shall not apply to Shares sold pursuant to a current
                and effective registration statement or a sale pursuant Rule 144
                or any
                successor rule:

            

    

     

    ARTICLE
      VIII

     

    CONDITIONS
      PRECEDENT TO THE COMPANY’S OBLIGATIONS

    

    The
      obligation of the Company to consummate the transactions contemplated hereby
      shall be subject to the fulfillment, on or prior to Closing Date, of the
      following conditions:

    

    
      	
              8.1.

            	
              No
                Termination.
                This Agreement shall not have been terminated pursuant to Article
                X
                hereof.

            

    

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
        Page-24

        
          

        

      

      
        
        

      

    

     

    
      	
              8.2.

            	
              Representations
                True and Correct.
                The representations and warranties of the Investor contained in this
                Agreement shall be true and correct in all material respects on and
                as of
                the Closing Date with the same force and effect as if made on as
                of the
                Closing Date.

            

    

     

    
      	
              8.3.

            	
              Compliance
                with Covenants.
                The Investor shall have performed and complied in all material respects
                with all covenants, agreements, and conditions required by this Agreement
                to be performed or complied with by it prior to or at the Closing
                Date.

            

    

     

    
      	
              8.4.

            	
              No
                Adverse Proceedings.
                On the Closing Date, no action or proceeding shall be pending by
                any
                public authority or individual or entity before any court or
                administrative body to restrain, enjoin, or otherwise prevent the
                consummation of this Agreement or the transactions contemplated hereby
                or
                to recover any damages or obtain other relief as a result of the
                transactions proposed hereby. 

            

    

     

    ARTICLE
      IX

     

    CONDITIONS
      PRECEDENT TO INVESTOR’S OBLIGATIONS

    

    The
      obligation of the Investor to consummate the transactions contemplated hereby
      shall be subject to the fulfillment, on or prior to Closing Date unless
      specified otherwise, of the following conditions:

    

    
      	
              9.1.

            	
              No
                Termination.
                This Agreement shall not have been terminated pursuant to Article
                X
                hereof.

            

    

     

    
      	
              9.2.

            	
              Representations
                True and Correct.
                The representations and warranties of the Company contained in this
                Agreement shall be true and correct in all material respects on and
                as of
                the Closing Date with the same force and effect as if made on as
                of the
                Closing Date.

            

    

     

    
      	
              9.3.

            	
              Compliance
                with Covenants.
                The Company shall have performed and complied in all material respects
                with all covenants, agreements, and conditions required by this Agreement
                to be performed or complied with by it prior to or at the Closing
                Date.

            

    

     

    
      	
              9.4.

            	
              No
                Adverse Proceedings.
                On the Closing Date, no action or proceeding shall be pending by
                any
                public authority or individual or entity before any court or
                administrative body to restrain, enjoin, or otherwise prevent the
                consummation of this Agreement or the transactions contemplated hereby
                or
                to recover any damages or obtain other relief as a result of the
                transactions proposed hereby.

            

    

     

    
      	
              9.5.

            	
              Acquisition
                of
                RTI.
                The
                Company
                shall have acquired
                RTI pursuant to the RTI Agreement, and prior to the closing, the
                Company
                shall have provided the Investor with evidence that RTI’s EBITDA for the
                year ended March 31, 2006 was not less than seven hundred ninety-nine
                thousand dollars ($799,000), after deducting the earnout of five
                hundred
                sixty thousand dollars ($560,000). 

            

    

     

    
      
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          PURCHASE AGREEMENT

        
        

      

      
        Page-25

        
          

        

      

      
        
        

      

    

     

    
      	
              9.6.

            	
              Approval
                of Restated Certificate.
                The Company’s board of directors shall have approved the Restated
                Certificate.

            

    

     

    
      	
              9.7.

            	
              Issuance
                of Warrants or Stock to Former Investors.
                The Company shall have issued Laurus Warrant to purchase 14,583,333
                shares
                of Common Stock, and shall have issued Keshet 3,000,000 shares of
                Common
                Stock. 

            

    

     

    ARTICLE
      X

     

    TERMINATION,
      AMENDMENT AND WAIVER

    

    
      	
              10.1.

            	
              Termination.
                This Agreement may be terminated at any time prior to the Closing
                Date

            

    

     

    10.1.1. by
      mutual
      written consent of the Investor and the Company;

     

    10.1.2. by
      the
      Company upon a material breach of any representation, warranty, covenant or
      agreement on the part of the Investor set forth in this Agreement, or by the
      Investor upon a material breach of any representation, warranty, covenant or
      agreement on the part of the Company set forth in this Agreement, or by either
      party if (a) the representations or warranties of the other party, taken
      together, shall fail to be true and correct in all material respects or (b)
      if
      the conditions to closing set forth in Article VIII or Article IX of this
      Agreement not be satisfied, and such breach or failure shall, if capable of
      cure, not have been cured within five (5) business days after receipt by the
      party in breach of a notice from the non-breaching party setting forth in detail
      the nature of such breach.

     

    
      	
              10.2.

            	
              Effect
                of Termination.
                Except as otherwise provided herein, in the event of the termination
                of
                this Agreement pursuant to Section 10.1 hereof, there shall be no
                liability on the part of the Company or the Investor or any of its
                officers, directors, agents or other representatives and all rights
                and
                obligations of any party hereto shall cease; provided, that if this
                Agreement shall be terminated pursuant to Section 10.1.2 of this
                Agreement, the breaching party shall be liable to the non-breaching
                party
                for all of the costs and expenses of the non-breaching party not
                to exceed
                $50,000. The breaching party shall be the party who shall have breached
                the representations, warranties, covenants and agreements under this
                Agreement or who shall have failed to satisfy the closing
                conditions.

            

    

     

    
      	
              10.3.

            	
              Amendment.
                This Agreement may be amended by the parties hereto any time prior
                to the
                Closing Date by an instrument in writing signed by the parties
                hereto;
                provided, however that the 4.9% Limitation may not be amended or
                waived.

            

    

     

    
      	
              10.4.

            	
              Waiver.
                At any time prior to the Closing Date, the Company or the Investor,
                as
                appropriate, may: (a) extend the time for the performance of any
                of the
                obligations or other acts of other party or; (b) waive any inaccuracies
                in
                the representations and warranties contained herein or in any document
                delivered pursuant hereto which have been made to it or them; or
                (c) waive
                compliance with any of the agreements or conditions contained herein
                for
                its or their benefit other than the 4.9% Limitation which may not
                be
                waived. Any such extension or waiver shall be valid only if set forth
                in
                an instrument in writing signed by the party or parties to be bound
                hereby.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-26

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      XI

     

    GENERAL
      PROVISIONS

    

    
      	
              11.1.

            	
              Transaction
                Costs.
                Except as otherwise provided herein, each of the parties shall pay
                all of
                his or its costs and expenses (including attorney fees and other
                legal
                costs and expenses and accountants’ fees and other accounting costs and
                expenses) incurred by that party in connection
                with this Agreement; provided, the Company shall pay the Investor
                for its
                expenses as provided in Section 6.22.

            

    

     

    
      	
              11.2.

            	
              Indemnification.
                The Investor agrees to indemnify, defend and hold the Company (following
                the Closing Date) and its officers and directors harmless against
                and in
                respect of any and all claims, demands, losses, costs, expenses,
                obligations, liabilities or damages, including interest, penalties
                and
                reasonable attorney’s fees, that it shall incur or suffer, which arise out
                of or result from any breach of this Agreement by the Investor or
                failure
                by the Investor to perform with respect to the representations, warranties
                or covenants contained in this Agreement or in any exhibit or other
                instrument furnished or to be furnished under this Agreement. The
                Company
                agrees to indemnify, defend and hold the Investor (following the
                Closing
                Date) harmless against and in respect of any and all claims, demands,
                losses, costs, expenses, obligations, liabilities or damages, including
                interest, penalties and reasonable attorney’s fees, that it shall incur or
                suffer, which arise out of, result from or relate to any breach of
                this
                Agreement or failure by the Company to perform with respect to the
                representations, warranties or covenants contained in this Agreement
                or in
                any exhibit or other instrument furnished or to be furnished under
                this
                Agreement. In no event shall the Company or the Investor be entitled
                to
                recover consequential or punitive damages resulting from a breach
                or
                violation of this Agreement nor shall any party have any liability
                hereunder in the event of gross negligence or willful misconduct
                of the
                indemnified party. In the event of the failure of the Company to
                issue the
                Series A Preferred Stock and Warrants in violation of the provisions
                of
                this Agreement, the Investor, as their sole remedy, shall be entitled
                to
                pursue a remedy of specific performance upon tender into the Court
                an
                amount equal to the Purchase Price hereunder. The indemnification
                by the
                Investor shall be limited to $50,000.00. This Section 11.2 shall
                not
                relate to indemnification under the Registration Rights
                Agreement.

            

    

     

    
      	
              11.3.

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

            

    

     

    
      	
              11.4.

            	
              Entire
                Agreement.
                This Agreement (together with the Schedule, Exhibits, Warrants and
                documents referred to herein) constitute the entire agreement of
                the
                parties and supersede all prior agreements and undertakings, both
                written
                and oral, between the parties, or any of them, with respect to the
                subject
                matter hereof. 

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-27

        
          

        

      

      
        
        

      

    

     

    
      	
              11.5.

            	
              Notices.
                All notices and other communications hereunder shall be in writing
                and
                shall be deemed to have been given (i) on the date they are delivered
                if
                delivered in person; (ii) on the date initially received if delivered
                by
                facsimile transmission or e-mail provided that any notice by facsimile
                or
                e-mail shall only be effective if receipt is acknowledged by the
                recipient; or (iv) on the on the date of delivery as shown on the
                return
                receipt, if mailed by registered or certified mail, return receipt
                requested with postage and other fees prepaid as
                follows:

            

    

     

    If
      to
      the Company:

    

    Science
      Dynamics Corporation

    7150
      North Park Drive; Suite 500

    Pennsauken,
      NJ 08109 

    Attn:
      Mr.
      Paul Burgess, CEO

    Facsimile:
      

    e-mail:
      pburgess@sysmanagement.com

    

    With
      a
      copy to:

     

    Sichenzia
      Ross Friedman Ference LLP

    1065
      Avenue of the Americas

    New
      York,
      New York 10018

    Attention:
      Asher S. Levitsky P.C.

    Facsimile
      No.: (212) 930-9725

    e-mail:
      alevitsky@srff.com

    

    If
      to
      the Investor:

    

    at
      its
      address set forth in Schedule A

    

    
      	
              11.6.

            	
              Severability.
                If any term or other provision of this Agreement is invalid, illegal
                or
                incapable of being enforced by any rule of law or public policy,
                all other
                conditions and provisions of this Agreement shall nevertheless remain
                in
                full force and effect so long as the economic or legal substance
                of the
                transactions contemplated hereby is not affected in any manner materially
                adverse to any party. Upon such determination that any such term
                or other
                provision is invalid, illegal or incapable of being enforced, the
                parties
                hereto shall negotiate in good faith to modify this Agreement so
                as to
                effect the original intent of the parties as closely as possible
                in an
                acceptable manner to the end that the transactions contemplated hereby
                are
                fulfilled to the extent possible.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-28

        
          

        

      

      
        
        

      

    

     

    
      	
              11.7.

            	
              Binding
                Effect.
                All the terms and provisions of this Agreement whether so expressed
                or
                not, shall be binding upon, inure to the benefit of, and be enforceable
                by
                the parties and their respective administrators, executors, legal
                representatives, heirs, successors and assignees.
                

            

    

     

    
      	
              11.8.

            	
              Preparation
                of Agreement.
                This Agreement shall not be construed more strongly against any party
                regardless of who is responsible for its preparation. The parties
                acknowledge each contributed and is equally responsible for its
                preparation. In
                resolving any dispute regarding, or construing any provision in,
                this
                Agreement, there shall be no presumption made or inference drawn
                because
                of the drafting history of the Agreement, or because of the inclusion
                of a
                provision not contained in a prior draft or the deletion or modification
                of a provision contained in a prior
                draft.

            

    

     

    
      	
              11.9.

            	
              Governing
                Law.
                This Agreement shall be governed by, and construed in accordance
                with, the
                laws of the State of New York, without giving effect to applicable
                principles of conflicts of law.

            

    

     

    
      	
              11.10.

            	
              Jurisdiction.
                If any action is brought among the parties with respect to this Agreement
                or otherwise, by way of a claim or counterclaim, the parties agree
                that in
                any such action, and on all issues, the parties irrevocably waive
                their
                right to a trial by jury. Exclusive jurisdiction and venue for any
                such
                action shall be the federal and state courts situated in the City,
                County
                and State of New York. In the event suit or action is brought by
                any party
                under this Agreement to enforce any of its terms, or in any appeal
                therefrom, it is agreed that the prevailing party shall be entitled
                to
                reasonable attorneys fees to be fixed by the arbitrator, trial court,
                and/or appellate court if such party prevails on substantially all
                issues
                in dispute.

            

    

     

    
      	
              11.11.

            	
              Preparation
                and Filing of SEC filings.
                The Investor shall reasonably assist and cooperate with the Company
                in the
                preparation of all filings with the SEC after the Closing Date due
                after
                the Closing Date. 

            

    

     

    
      	
              11.12.

            	
              Further
                Assurances, Cooperation.
                Each party shall, upon reasonable request by the other party, execute
                and
                deliver any additional documents necessary or desirable to complete
                the
                transactions herein pursuant to and in the manner contemplated by
                this
                Agreement. The parties hereto agree to cooperate and use their respective
                best efforts to consummate the transactions contemplated by this
                Agreement.

            

    

     

    
      	
              11.13.

            	
              Survival.
                The representations, warranties, covenants and agreements made herein
                shall survive the Closing of the transaction contemplated hereby.
                

            

    

     

    
      	
              11.14.

            	
              Third
                Parties.
                Except as disclosed in this Agreement, nothing in this Agreement,
                whether
                express or implied, is intended to confer any rights or remedies
                under or
                by reason of this Agreement on any persons other than the parties
                hereto
                and their respective administrators, executors, legal representatives,
                heirs, successors and assignees. Nothing in this Agreement is intended
                to
                relieve or discharge the obligation or liability of any third persons
                to
                any party to this Agreement, nor shall any provision give any third
                persons any right of subrogation or action over or against any party
                to
                this Agreement.

            

    

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-29

        
          

        

      

      
        
        

      

    

     

    
      	
              11.15.

            	
              Failure
                or Indulgence Not Waiver; Remedies Cumulative.
                No failure or delay on the part of any party hereto in the exercise
                of any
                right hereunder shall impair such right or be construed to be a waiver
                of,
                or acquiescence in, any breach of any representation, warranty, covenant
                or agreement herein, nor shall any single or partial exercise of
                any such
                right preclude other or further exercise thereof or of any other
                right.
                All rights and remedies existing under this Agreement are cumulative
                to,
                and not exclusive of, any rights or remedies otherwise
                available.

            

    

     

    
      	
              11.16.

            	
              Counterparts.
                This Agreement may be executed in one or more counterparts, and by
                the
                different parties hereto in separate counterparts, each of which
                when
                executed shall be deemed to be an original, but all of which taken
                together shall constitute one and the same agreement. A facsimile
                transmission of this signed Agreement shall be legal and binding
                on the
                party who delivered the Agreement by facsimile transmission.
                

            

    

     

    [SIGNATURES
      ON FOLLOWING PAGE]

     

    
      
        SECURITIES
          PURCHASE AGREEMENT

        
        

      

      
        Page-30

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF,
      the
      Investor and the Company have as of the date first written above executed this
      Agreement.

    
      	 	 	 	 
	
              THE
                COMPANY:

               

              SCIENCE
                DYNAMICS CORPORATION

            	 
	 	 
 	 
 	 
 
	 By:  	/s/
              Joseph Noto 	 	 
	 	
              
Joseph
              Noto, CFO	
            
	 	 	 

    

    
      	 	 	 	 
	
              INVESTORS:

              
BARRON
                PARTNERS LP

              By:
                Barron Capital Advisors, LLC, its General Partner

            	 
	 	 
 	 
 	 
 
	
               By: 

            	/s/
              Andrew Barron Worden 	 	 
	 	
              
                
Andrew
                Barron Worden

              Managing
                Partner 

              730
                Fifth Avenue, 25th Floor

              New
                York NY 10019

            	
            
	 	 	 

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule
      A

    

    
      	
               

               

               

              NAME
                AND ADDRESS

            	 	
              AMOUNT
                OF INVESTMENT

            	 	
              NUMBER
                OF SHARES 

              OF
                PREFERRED STOCK 

              INTO
                WHICH NOTE IS CONVERTIBLE

            	 	
              NUMBER
                OF SHARES 

              OF
                COMMON STOCK 

              INTO
                WHICH PREFERRED 

              STOCK
                IS CONVERTIBLE

            	 	
               

              NUMBER
                OF SHARES UNDERLYING “A”
                AND “B” WARRANTS

            	 
	
              Barron
                Partners LP

              730
                Fifth Avenue

              25th
                Floor

              New
                York, New York 10019

              Attn:
                Andrew Barron Worden

              e-mail:
                abw@barronpartners.com

              hrm@barronpartners.com

            	 	
              $

            	
              4,500,000

            	 	 	
              7,826,087

            	 	 	
              19,565,218

            	 	 	
              125,000,000/

              125,000,000

            	 

    

     

    *
      Reflects one-for-ten reverse split.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Schedule
      4.3.1 – Capitalization

     

    
      
        	
                Schedule
                  4.3.1

              	 	 	 	 	 	 	 
	
                Science
                  Dynamics Corporation, Inc

              	 	 	 	 	 	 	 
	
                Cap
                  Table Post RTI Closing ( Aug 31, 2006 Assumed)

              	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	
                 

              	 	 	
                Common
                  SHS 

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Share
                  o/s as of Aug 25, 2006

              	 	 	
                113,980,767
                  

              	 	 	 	 
	
                Shares
                  to be issued at closing:

              	 	 	 	 	 	 	 
	
                Keshet

              	 	 	
                3,000,000
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Mike
                  Ricciardi (RTI Sale)

              	 	 	
                50,000,000
                  

              	 	 	 	 
	 	 	 	 
 	 	 	 	 
	
                Shares
                  o/s post closing

              	 	 	
                166,980,767
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Derivatives
                  at Closing:

              	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Feb
                  28, 2005 Options SMEI EE's

              	 	 	
                1,735,000
                  

              	 	 	 	 
	
                April
                  1, 2005 Options CFO

              	 	 	
                2,000,000
                  

              	 	 	 	 
	
                Feb
                  28, 2005 Options SDC EE's

              	 	 	
                505,000
                  

              	 	 	 	 
	
                RTI
                  Options

              	 	 	
                4,250,000
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Laurus
                  Warrants (2.0M Note)

              	 	 	
                6,000,000
                  

              	 	 	 	 
	
                Seller
                  5.0mshs Preferred Conversion

              	 	 	
                8,333,333
                  

              	 	 	 	 
	
                Laurus
                  Warrants Nov18 Modification

              	 	 	
                3,000,000
                  

              	 	 	 	 
	
                Laurus
                  Warrants

              	 	 	
                14,583,333
                  

              	 	 	
                Replaces
                  Laurus Debt

              	 
	
                Friends
                  and Family Warrrants $0.12

              	 	 	
                11,667,000
                  

              	 	 	 	 
	
                A
                  Bashflorth options 

              	 	 	
                8,000,000
                  

              	 	 	 	 
	
                P
                  Burgess (CEO) Options

              	 	 	
                10,000,000
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Total

                  derivatives

              	 	 	
                70,073,666
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Fully
                  Diluted SH count post Closing

              	 	 	
                237,054,433
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Barron:

              	 	 	 	 	 	 	 
	
                Barron
                  Warrants

              	 	 	
                250,000,000
                  

              	 	 	 	 
	
                Barron
                  SHS

              	 	 	
                195,652,174
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Total
                  with Barron

              	 	 	
                682,706,607
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Dragonfly
                  warrants $.05

              	 	 	
                4,891,000
                  

              	 	 	 	 
	
                Dragonfly
                  warrants $.125

              	 	 	
                4,891,000
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Total
                  with Barron and Dragonfly

              	 	 	
                692,488,607
                  

              	 	 	 	 
	 	 	 	 	 	 	 	 
	
                Total
                  After Reverse

              	 	 	
                69,248,861
                  

              	 	 	 	 

      

      

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

    

    Schedule
      4.8 –
      Broker

     

    
      Schedule
        4.8 to the Securities Purchase Agreement between Science Dynamics Corporation
        and Barron Partners LP

      

      
        	
                Name
                  of Broker  

              	 	
                Amount
                  of fee or commission due

              
	
                Dragonfly
                  Capital Partners, LLC: 

                 

              	 	
                $234,000
                  of which $134,000 shall be paid   at
                  the closing and the balance of which shall
                  be paid post-closing and warrants to purchase 4,891,000 shares
                  of the
                  Company’s common stock at $0.05 per share and warrants to purchase
                  4,891,000 shares of the Company’s common stock at $0.125 per
                  share

              
	 	 	 
	
                Colebrooke
                  Capital: 

              	 	
                $126,000
                  of which $76,000 shall be
                  paid at closing and the

              
	 	 	 
	
                CRESCENT
                  FUND LLC 

              	 	
                $20,000
                  to be paid post-closing 

              
	 	 	 
	
                Watergate
                  Holding LLC     

              	 	
                $115,000

              

      

      

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

    

    Exhibit
      A

    

    Form
      of Note

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      B

    

    Form
      of Certificate of Designation 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      C

    

    Escrow
      Agreement

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      D

    

    Registration
      Rights Agreement

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
      E

    

    Restated
      Certificate 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      F

    

    Form
      of Series B Certificate of Designation 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      G-1

    

    $.05
      Warrants

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Exhibit
      F-2

    

    $.125
      WarrantSTOCK
      PURCHASE AGREEMENT

     

    by

     

    RICCIARDI
      TECHNOLOGIES, INC.,

     

    ITS
      OWNERS, INCLUDING

     

    MICHAEL
      RICCIARDI AS THE OWNER REPRESENTATIVE

     

    and

     

    SCIENCE
      DYNAMICS CORPORATION

    

    

    

    

      DATED
        AS OF SEPTEMBER
        12, 2006

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    STOCK
      PURCHASE AGREEMENT

     

    THIS
      STOCK PURCHASE AGREEMENT (this “Agreement”)
      is
      dated as of September 12, 2006 by and among SCIENCE DYNAMICS CORPORATION, a
      Delaware corporation (“Purchaser”),
      RICCIARDI TECHNOLOGIES, INC., a Virginia corporation (the “Company”)
      and
      those other persons listed on Schedule O
      hereto
      (the “Owners”)
      and
      Michael Ricciardi, one
      of
      the Owners and as a representative of all of the Owners (the “Owner
      Representative”).

     

    Preliminary
      Statements

     

    WHEREAS,
      the
      Company is in the business of providing software consulting and development
      services for the command and control of biological sensors and other Department
      of Defense requirements to United States federal governmental agencies either
      directly or through prime contractors of such governmental agencies (the
“Business”);
      

     

    WHEREAS,
      the
      Owners own all of the outstanding capital stock of the Company;

     

    WHEREAS,
      Purchaser is interested in acquiring all of the Company’s outstanding capital
      stock; and

     

    WHEREAS,
      the
      Owners are willing to sell, and Purchaser is willing to purchase, all of the
      outstanding capital stock of the Company held by the Owners pursuant to the
      terms and conditions hereof;

     

    NOW,
      THEREFORE,
      in
      consideration of the foregoing and the mutual promises, covenants and agreements
      contained in this Agreement, the parties, intending to be legally bound, hereby
      agree as follows:

     

    ARTICLE
      1

    CERTAIN
      DEFINITIONS

     

    1.1 Defined
      Terms.
      As used
      in this Agreement, the following terms shall have the meanings herein specified,
      unless the context otherwise requires: 

     

    Affiliate
      means:
      (i) any Person that directly or indirectly through one or more intermediaries
      controls, is controlled by or under common control with the Person specified;
      (ii) any director, officer, or Subsidiary of the Person specified; and
      (iii) the immediate family members of the Person specified. For purposes of
      this
      definition and without limitation to the previous sentence, (a) “control”
of
      a
      Person means the power, direct or indirect, to direct or cause the direction
      of
      management and policies of such Person, whether through ownership of voting
      securities, by contract or otherwise, (b) any Person owning more than ten
      percent (10%) or more of the voting securities or similar interests of another
      Person shall be deemed to be an Affiliate of that Person, and (c) “immediate family member”
means
      a
      Person’s spouse, parents or siblings, or lineal descendants of any of the
      foregoing (by blood, adoption or marriage).

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    Books
      and Records
      means
      all records, documents, lists and files, relating to the Business including,
      without limitation, price lists, lists of accounts, customers, suppliers and
      personnel, all product, business and marketing plans, historical sales data
      and
      all books, ledgers, files and business records (including, without limitation,
      all financial records and books of account), in any of the foregoing cases,
      whether in electronic form or otherwise.

     

    Business
      Day
      shall
      mean any day that banks are opened for business in the Commonwealth of Virginia,
      other than a Saturday or Sunday.

     

    Cash
      means
      all
      cash, marketable securities and cash equivalents (including Tax refunds) of
      the
      Company plus $100,000 from the Company's credit line with Wachovia
      Bank.

     

    Cash
      Deposit
      means
      One Hundred Thousand Dollars ($100,000).

     

    Cause
      means
      (a) conviction of, or plea or nolo contendere to, a felony or other crime
      involving moral turpitude; (b) fraud on or misappropriation of any funds or
      property of the Company or any Affiliate, customer or vendor of the Company;
      (c)
      personal dishonesty, willful misconduct, or breach of fiduciary duty against
      the
      Company which involves personal profit; (d) material breach of any provision
      of
      any employment, non-disclosure, non-competition, non-solicitation or other
      similar agreement, executed by the employee for the benefit of the Company
      or
      the Purchaser, as determined by the Company's or Purchaser's Board of Directors,
      as applicable; or (e) a refusal to substantially perform the employee's written
      and known duties (excluding death and disability of the employee); provided,
      however, that in the case of clauses (d) and (e), it shall not constitute Cause
      unless the Company or Purchaser, as the case may be, shall have provided the
      employee with written notice of its alleged actions constituting Cause (which
      notice shall specify in reasonable detail the particulars of such Cause) and
      the
      employee has not cured any such alleged Cause or substantially commenced its
      effort to cure such breach within thirty (30) days of the employee's receipt
      of
      such written notice.

    

    Change
      of Control
      of
      Purchaser or Company means: (1) the closing of a sale or other conveyance
      of all or substantially all of the assets of Company or Purchaser; or (2) the
      closing of a sale or other conveyance of all or substantially all of the
      outstanding securities of Purchaser or Company (including by merger, share
      exchange, consolidation, or other business combination involving the Company
      or
      Purchaser, as the case may be). 

    

    Claim
      Notice
      has the
      meaning set forth in Section 10.3(b).

     

    Closing
      has
      the
      meaning set forth in Section 8.1.

     

    Closing
      Date
      has the
      meaning set forth in Section 8.1.

     

    Closing
      Payment has
      the
      meaning set forth in Section 3.1(b).

     

    Code
      means
      the Internal Revenue Code of 1986 and the rules and regulations promulgated
      thereunder, as amended and supplemented from time to time.

     

    Company
      Expenses
      means
      the following expenses of Company: (a) the cash contribution to the ESOP
      for fiscal year ending March 31, 2006 and for the partial fiscal year ending
      as
      of the Closing Date; (b) the redemption price for the shares of Company common
      stock held by ESOP; (c) the aggregate amount of all Company Taxes for all
      Tax periods ending on or prior to March 31, 2006 payable by the Owners in
      accordance with Section 12.2(a); (d) commissions, fees and other charges
      and expenses due to Company’s legal counsel and other service providers in
      connection with the transactions contemplated by this Agreement, including
      Holland & Knight LLP, Sheppard Mullin Richter & Hampton LLP and Advanced
      Valuation Analytics, Ltd. not remitted by Company; and (e) any other fees
      and expenses the Owner Representative is permitted to pay of the Purchase Price
      in accordance with Section 14.12.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Company
      Material Adverse Effect means
      any
      materially adverse change in or effect on the financial condition, Business,
      operations, assets or properties of the Company before the Closing and on the
      Business after the Closing, provided that (i) changes in general industry
      conditions or general economic conditions, consequences of acts of war or
      terrorism, (ii) adverse effects arising from the announcement or
      consummation of the transactions contemplated under this Agreement, or
      (iii) the loss of a re-compete of any Material Contract, the failure of any
      Material Contract to be renewed or have an option elected, the failure of the
      Company to be awarded any Contract in response to any bid or the termination
      of
      any Material Contract for convenience shall not be deemed to constitute a
      Company Material Adverse Effect.

     

    Consents
      means
      any
      consents, waivers, approvals, authorizations, certifications or exemptions
      from
      any Person under any Contract or Requirement of Law or otherwise, as
      applicable.

     

    Contracts
      means,
      with respect to any Person, any indentures, indebtedness, contracts, leases,
      agreements, instruments, licenses, undertakings and other commitments, whether
      written or oral, to which such Person or such Person’s properties are bound,
      exclusive of Permits. 

     

    Conversion
      Shares shall
      have the meaning set forth in Section 5.4(b).

     

    Earn-Out
      Payment
      shall
      have the meaning set forth in Section 3.2(a).

     

    Earn-Out
      Period
      shall
      have the meaning set forth in Section 3.2(a).

     

    Earn-Out
      Notice
      shall
      have the meaning set forth in Section 3.2(b).

     

    EBITDA
      shall
      mean the consolidated earnings of the Company and Purchaser from operations
      (including, without limitation, consolidated earnings of the Company and
      Purchaser from the services division and the Company's SensorView product)
      before interest, taxes, depreciation, amortization and extraordinary gains
      or
      losses and excluding (1) Purchaser's Technology Division (the division providing
      Purchaser’s technical products and services), (2) Purchaser's unallocated
      corporate expenses, all as determined in accordance with GAAP, and as agreed
      to
      by Owner Representative, and (3) earnings generated from additional acquisitions
      or new product lines from such additional acquisitions by Purchaser.

     

    Effective
      Time means
      12:01 a.m. on the Closing Date.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    Employee
      Benefit Plan
      means
      any “employee benefit plan” (as such term is defined in ERISA Section 3(3)) and
      any other deferred compensation, pension, profit sharing, stock bonus,
      restricted stock, stock option, stock purchase, savings, group insurance or
      retirement plan, and all vacation pay, severance pay, life, health, disability,
      premium conversion, flexible spending, incentive compensation, bonus and other
      employee benefit or fringe benefit plans or arrangements (whether written or
      unwritten) maintained by the Company or any of its ERISA Affiliates (including,
      without limitation, any benefit plan or arrangement maintained for retirees)
      within the previous three plan years or with respect to which contributions
      are
      or were (within such three year period) made or required to be made by any
      the
      Company or any of its ERISA Affiliates or with respect to which the Company
      or
      any of its ERISA Affiliates has any liability.

     

    Employment
      Agreement
      means
      the employment agreement by and between Purchaser and Michael Ricciardi, in
      the
      form attached hereto as Exhibit I.

     

    Encumbrances
      means,
      with respect to any asset, any security interests, liens, encumbrances, pledges,
      trusts, charges, proxies, mortgages, conditional or installment sales Contracts,
      title retention Contracts and transferability restrictions.

     

    ERISA
      means
      the Employment Retirement Income Security Act of 1974 and the rules and
      regulations promulgated thereunder, as amended and supplemented from time to
      time.

     

    ERISA
      Affiliate
      means
      any Person that is included with the Company in a controlled group or affiliated
      service group under Sections 414(b), (c), (m) or (o) of the Code.

     

    Escrow
      Agent
      means
      the meaning given to such term in the Escrow Agreement or the Hold Back Escrow
      Agreement, as the case may be.

     

    Escrow
      Agreement
      has the
      meaning set forth in Section 3.4(a).

     

    Escrow
      Balance
      has the
      meaning set forth in Section 3.4(a).

     

    Escrow
      Deposit has
      the
      meaning set forth in Section 3.4(a).

     

    ESOP
      means
      the Ricciardi Technologies, Inc. Employee Stock Ownership Plan.

     

    GAAP
      means
      generally accepted accounting principals applicable in the United States of
      America.

     

    Good
      Reason
      means
      any one of the following: (a) the Company’s (or its Affiliates) willful material
      breach of any provision of an employee agreement by and between employee and
      Company or Purchaser; (b) any material adverse change in the employee's position
      (including status, offices, titles and reporting requirements), authority,
      duties or responsibilities, or any other action by the Company or Purchaser
      made
      without the employee's permission (other than a change due to the employee's
      permanent disability or as an accommodation under the Americans With
      Disabilities Act) or (c) Company (or its Affiliates) requiring relocation
      of employee more than twenty-five (25) miles from Manassas, Virginia without
      employee's consent; provided,
      however,
      that it
      shall not constitute Good Reason unless the employee shall have provided the
      Company or Purchaser, as the case may be, with written notice of its alleged
      actions constituting Good Reason (which notice shall specify in reasonable
      detail the particulars of such Good Reason) and the Company or Purchaser, as
      the
      case may be, has not cured any such alleged Good Reason or substantially
      commenced its effort to cure such breach within thirty (30) days of the
      Company's or Purchaser's, as the case may be, receipt of such written
      notice.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    Governmental
      or Regulatory Authority
      means
      any court, tribunal, arbitrator, authority, agency, commission, official or
      other instrumentality of the government of the United States or of any foreign
      country, or of any state or any political subdivision of any such government
      (whether state, provincial, county, city, municipal or otherwise).

     

    Historical
      Financial Statements
      has the
      meaning set forth in Section 4.12(a).

     

    Indebtedness
      means,
      without duplication, (a) all indebtedness (including the principal amount
      thereof and the amount of accrued and unpaid interest thereon) of the Company,
      whether or not represented by bonds, debentures, notes or other securities,
      for
      the repayment of money borrowed, (b) all deferred indebtedness of the
      Company for the payment of the purchase price of property or assets purchased,
      (c) all obligations of the Company to pay rent or other payment amounts
      under a lease of real or personal property which is required to be classified
      as
      a capital lease or a liability on the face of a balance sheet prepared in
      accordance with GAAP, (d) any outstanding reimbursement obligation of the
      Company with respect to letters of credit, bankers’ acceptances or similar
      facilities issued for the account of the Company, (e) any payment
      obligation of the Company under any interest rate swap agreement, forward rate
      agreement, interest rate cap or collar agreement or other financial agreement
      or
      arrangement entered into for the purpose of limiting or managing interest rate
      risks, (f) all indebtedness for borrowed money secured by any Encumbrances
      existing on property owned by the Company, whether or not indebtedness secured
      thereby shall have been assumed, (g) all guaranties, endorsements,
      assumptions and other contingent obligations of the Company in respect of,
      or to
      purchase or to otherwise acquire, indebtedness for borrowed money of other
      Persons, and (h) all premiums, penalties and change of control payments
      required to be paid or offered in respect of any of the foregoing as a result
      of
      the consummation of the transactions contemplated by this Agreement or
      otherwise, regardless if any of such are actually paid.

     

    Indemnifiable
      Losses
      means
      all losses, liabilities, obligations, claims, demands, (including any
      governmental penalty or punitive damages), deficiencies, interest, damages,
      penalties, settlements, causes of action, Taxes, costs and expenses, including,
      without limitation, the actual reasonable costs paid in connection with an
      Indemnified Party’s investigation and evaluation of any claim or right asserted
      against such Indemnified Party and all reasonable attorneys’, experts’ and
      accountants’ fees, expenses and disbursements and court costs including, without
      limitation, those incurred in connection with the Indemnified Party’s
      enforcement of this Agreement and the indemnification provisions of Article
      10
      of this
      Agreement.

     

    Indemnified
      Employees
      has the
      meaning set forth in Section 11.2(a).

     

    Indemnified
      Party
      has the
      meaning set forth in Section 10.3(a).

     

    Indemnifying
      Party
      has the
      meaning set forth in Section 10.3(a).

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    Indemnity
      Notice
      has the
      meaning set forth in Section 10.3(a).

     

    Intellectual
      Property
      means,
      with respect to any Person, all patents, patent rights, patent applications,
      registered trademarks and service marks, trademark rights, trademark
      applications, service mark rights, service mark applications, trade names,
      fictitious names, registered copyrights, copyright rights (including, without
      limitation, computer programming code) and all intellectual, industrial or
      proprietary rights and trade secrets, technology and know-how in which such
      Person has an ownership or licensed interest, in each case together with any
      amendments, modifications and supplements thereto.

     

    Interim
      Financial Statements
      has the
      meaning set forth in Section 4.12(b).

     

    Inventory
      means,
      with respect to any Person, all inventory incremental or relating to, or used
      in
      connection with such Person's business including, without limitation, all raw
      materials, parts, accessories, upgrades, supplies, packaging materials, finished
      goods and vehicles. 

     

    IRS
      means
      the Internal Revenue Service or any successor organization thereto.

     

    Knowledge
      means
      with respect to any representation, warranty or statement of any party in this
      Agreement that is qualified by such party’s “Knowledge,”
the
      actual knowledge of such party, and (a) in the case of the Company, the actual
      knowledge of the Material Owners; and (b) in the case of Purchaser, the actual
      knowledge of Purchaser’s officers, directors and managers.

     

    Leased
      Real Property
      means
      all real property leased to Company.

     

    Legal
      Proceeding
      means
      any action, suit, arbitration, claim or investigation by or before any
      Governmental or Regulatory Authority, any arbitration or alternative dispute
      resolution panel, or any other legal, administrative or other
      proceeding.

     

    Material
      Contracts
      has the
      meaning set forth in Section 4.13(a).

     

    Material
      Owners
      means
      Michael Ricciardi, David Godso and Marie Ricciardi.

     

    Neutral
      Auditor
      has the
      meaning set forth in Section 3.2(b).

    

    Note
      has
      the
      meaning set forth in Section 3.1(a).

    

    Noticed
      Party
      has the
      meaning set forth in Section 10.3(a).

    

    Obligations
      and Liabilities
      and
      words of similar import include, without limitation, any direct or indirect
      indebtedness, guaranty, endorsement, claim, loss, damage, deficiency, cost,
      expense, obligation or responsibility, fixed or unfixed, known or unknown,
      asserted or unasserted, choate or inchoate, liquidated or unliquidated, secured
      or unsecured.

     

    Order
      means
      any judgment, order, writ, decree, injunction or other determination whatsoever
      of any Governmental or Regulatory Authority or any other entity or body whose
      finding, ruling or holding is legally binding or is enforceable as a matter
      of
      right (in any case, whether preliminary or final).

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    Owner
      Representative
      has the
      meaning set forth in Section 14.12.

     

    Payment
      Factor means a
      fraction, the numerator of which equals the aggregate number of Transferred
      Shares being sold under this Agreement by an Owner as set forth on Schedule
      O
      and the
      denominator equals the aggregate number of Transferred Shares being sold by
      all
      Owners under this Agreement as set forth on Schedule
      O.

     

    Permits
      means
      all licenses, permits, certificates of authority, authorizations, approvals,
      registrations, franchises, rights, orders, qualifications and similar rights
      or
      approvals granted or issued by any Governmental or Regulatory Authority relating
      to the Business.

     

    Person
      means
      any natural person, corporation, general partnership, limited partnership,
      limited liability company, proprietorship, joint venture, trust, association,
      union, entity, or other form of business organization or any Governmental or
      Regulatory Authority whatsoever. 

     

    Pledge
      Agreement
      has the
      meaning set forth in Section 3.4(c).

     

    Property
      Leases means
      the
      leases for real property of a Person.

     

    Purchase
      Price
      has the
      meaning set forth in Section 2.1.

     

    Purchaser
      Equity has
      the
      meaning set forth in Section 5.4.

     

    Purchaser
      Common Shares has
      the
      meaning set forth in Section 2.1.

     

    Purchaser
      Preferred Shares has
      the
      meaning set forth in Section 2.1.

     

    Purchaser
      Shares has
      the
      meaning set forth in Section 2.1.

     

    Receivables
      means,
      with respect to any Person and as of any date of determination, such Person's
      (a) trade accounts receivable for work performed, (b) rights to
      receive payment from banks, credit card organizations, and credit card
      transaction processing services, with respect to the sale of Inventory by such
      Person prior to such date, (c) notes receivable, (d) receivables from
      vendors, manufacturers and other suppliers of the such Person or such Person's
      business, (e) receivables related to repairs made under warranty; and
      (e) other miscellaneous receivables of such Person or such Person's
      business at such date.

     

    Regulatory
      Approvals
      means
      all Consents from all Governmental or Regulatory Authorities.

     

    Requirement
      of Law
      means,
      with respect to any Person, any provision of law, statute, treaty, rule,
      regulation, ordinance, executive order or pronouncement having the effect of
      law, whether domestic or foreign, or any Order, whether domestic or foreign,
      to
      which, in each case, such Person or any of such Person’s properties, operations,
      business or assets is bound or subject.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

    Restated
      Charter means
      Purchaser's certificate of incorporation, as amended, including as amended
      by
      the Statement of Designations.

     

    Resolution
      Period has
      the
      meaning set forth in Section 3.2(b)

     

    Securities
      Act
      means
      the Securities Act of 1933 and the rules and regulations promulgated thereunder,
      all as amended and supplemented from time to time.

     

    Statement
      of Designations
      is the
      statement of designations to Purchaser's certificate of incorporation, in the
      form attached hereto as Exhibit H, and that sets forth the rights, preferences,
      privileges and restrictions of the Purchaser Preferred Shares.

     

    Subsidiary
      means,
      with respect to any Person, any Person of which securities or other ownership
      interests having ordinary voting power to select a majority of the board of
      directors or other persons serving similar functions are at the time directly
      or
      indirectly owned by such Person.

     

    Taxes
      means
      (a) any tax, charge, fee, levy or other assessment including, without
      limitation, any net income, gross income, gross receipts, sales, use, ad
      valorem, transfer, franchise, profits, payroll, employment, social security,
      withholding, unemployment, excise, estimated, stamp, occupancy, occupation,
      property or other similar taxes, including any interest or penalties thereon,
      and additions to tax or additional amounts imposed by any federal, state, local
      or foreign Governmental or Regulatory Authority, domestic or foreign (a
“Taxing Authority”)
      or (b)
      any liability for the payment of any taxes, interest, penalty, addition to
      tax
      or like additional amount resulting from the application of Treasury Regulation
      §1.1502-6 or comparable Requirement of Law.

     

    Tax
      Returns
      means
      any declaration, return, report, estimate, information return, schedule,
      statements or other document filed or required to be filed with or, when none
      is
      required to be filed with a Taxing Authority, the statement or other document
      issued by, a Taxing Authority.

     

    Territory
      shall
      mean the United States of America.

     

    Transaction
      Documents
      means
      this Agreement and all other agreements executed in connection with this
      Agreement to effectuate the transaction contemplated hereby.

     

    Transferred
      Shares
      has the
      meaning set forth in Section 2.2.

     

    Transfer
      Taxes
      means
      any applicable documentary, sales, use, stamp, filing, registration, transfer
      and similar Taxes (including penalties and interest) payable as a result of
      the
      conveyance of the Transferred Shares contemplated by this
      Agreement.

     

    Treasury
      Regulations
      means
      the regulations promulgated under the Code.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      2

    PURCHASE
      OF TRANSFERRED SHARES

     

    2.1. Purchase
      and Sale of the Shares. Subject
      to the terms and conditions set forth in this Agreement, and in reliance upon
      the representations and warranties made by the Company and the Owners to
      Purchaser and made by Purchaser to the Owners and Company in this Agreement,
      as
      of the Effective Time, the Owners shall sell, transfer and assign to Purchaser,
      and Purchaser shall purchase and acquire from the Owners free and clear of
      all
      Encumbrances except the Encumbrances set forth in the Pledge Agreement in
      accordance with Section 3.4(c) below, one hundred percent (100%) of Owners’
shares of the Company’s outstanding common stock in exchange for the payment by
      Purchaser to Owners of Four Million Dollars ($4,000,000), 50,000,000 shares
      of
      common stock of Purchaser ("Purchaser
      Common Shares"),
      1,000,000 shares of Series B Convertible Preferred Stock of Purchaser, having
      the rights, preferences, privileges and restrictions set forth in the Statement
      of Designations ("Purchaser
      Preferred Shares,"
      and
      collectively with the Purchaser Common Shares, "Purchaser
      Shares")
      and
      the Earn-Out Payment, if any, free and clear of all Encumbrances as adjusted
      pursuant to Sections 3.2 and 3.4 (the "Purchase
      Price").
      The
      Purchase Price is payable in accordance with Section 3.1.

     

    2.2. Delivery.
      The
      shares of Company capital stock being purchased pursuant to
      Section 2.1
      are
      collectively referred to in this Agreement as the “Transferred
      Shares.”
Upon
      consummation of the Closing, all of the Transferred Shares shall have been
      sold,
      transferred and conveyed to Purchaser without any further action by or
      documentation from the Owners; provided, however, but subject to
      Section 3.4(c) below, each of the Owners shall deliver to Purchaser a
      certificate or certificates, registered in the name of such Owner, properly
      endorsed, representing all of the Transferred Shares held by such
      Owner. 

     

    ARTICLE
      3

    CONSIDERATION

     

    3.1. Consideration
      and Payment. The
      Purchase Price for the Transferred Shares shall be paid as follows:

     

    (a) On
      the
      Closing Date, in exchange for the Transferred Shares, Purchaser shall deliver
      to
      Owners (i) 44,166,667 Purchaser Common Shares free and clear of all Encumbrances
      except as set forth in the Registration Rights Agreement, attached hereto as
      Exhibit A, (ii) $3,150,000 in cash in immediately available funds,
      minus the Cash Deposit if paid by Purchaser to Owners pursuant to Section 8.1
      below, (iii) a promissory note (“Note”)
      in the
      principal amount of $500,000.00, the form of which is attached hereto as Exhibit
      B, and (iv) 1,000,000 Purchaser Preferred Shares free and clear of all
      Encumbrances except as set forth in the Registration Rights Agreement ((i),
      (ii), (iii) and (iv), collectively, the "Closing
      Payment")
      and
      shall also pay the Escrow Deposit to the Escrow Agent. The Purchaser Shares
      shall be made tradable in accordance with the Registration Rights Agreement,
      attached hereto as Exhibit A. 

     

    (b) On
      the
      Closing Date, Purchaser shall deliver to Company’s employees two million
      (2,000,000) incentive stock options to purchase Purchaser Common Shares, priced
      at the greater of: (i) the closing market price and (ii) the volume-weighted
      average price per share for the fifteen (15) days prior to the Closing Date..
      The granting of the options shall be made pursuant to allocations determined
      by
      the Owner Representative, and shall be approved by Purchaser, approval not
      to be
      unreasonably withheld. The options will have a ten (10) year term, shall vest
      equally each year in three (3) years and such vesting shall accelerate if
      (i) such employee is terminated without Cause or without Good Reason or
      (ii) upon a Change of Control of Purchaser. 

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    (c) Over
      a
      two (2) year period, beginning on the Closing Date, Purchaser shall deliver
      to
      Company’s employees Five Hundred Thousand (500,000) incentive stock options each
      year for a total of One Million (1,000,000) incentive stock options to purchase
      Purchaser Common Shares, priced at the greater of: (i) the closing market price
      and (ii) the volume-weighted average price per share for the fifteen (15) days
      prior to the date of each such grant. The granting of the options shall be
      made
      pursuant to allocations determined by the Owner Representative, and shall be
      approved by Purchaser, approval not to be unreasonably withheld. The options
      will have a ten (10) year term and shall vest equally in each year in three
      (3)
      years and such vesting shall accelerate if (i) such employee is terminated
      without Cause or without Good Reason or (ii) upon a Change of Control of
      Purchaser. 

     

    3.2. Earn-Out.

     

    (a) Calculation
      of Earn-Out Payment.
      As part
      of the Purchase Price for the Transferred Shares, the Purchaser shall pay to
      the
      Owners up to One Million Five Hundred Thousand Dollars ($1,500,000) in cash
      as
      an earn-out payment (the “Earn-Out
      Payment”).
      One
      half of the Earn-Out Payment shall be payable to Owners if the total amount
      of
      the EBITDA for the twelve-month period ending on the one year anniversary of
      the
      Closing Date (the “Earn-Out
      Period”)
      is
      equal to or greater than $2,250,000 but less than $2,500,000 and the entire
      Earn
      Out Payment shall be payable to Owners if the total amount of the EBITDA for
      the
      Earn-Out Period is equal to or exceeds $2,500,000. The Purchaser shall pay
      the
      Earn-Out Payment to the Owners in cash in accordance with Section 3.2(b)
      below.

     

    (b) Payment
      and Dispute Procedures.
      Within
      thirty (30) days of completion of Purchaser's audit for 2007, but in no event
      later than April 30, 2008, the Purchaser will deliver to the Owner
      Representative a notice (the “Earn-Out
      Notice”)
      setting forth Purchaser’s determination of the EBITDA for the Earn-Out Period
      and stating whether the Owners are entitled to the Earn-Out Payment, in whole
      or
      in part. If the Earn-Out Notice provides that the Owners are entitled to all
      or
      half of the Earn-Out Payment, the Purchaser shall make the applicable Earn-Out
      Payment no later than thirty (30) days following delivery of the Earn-Out
      Notice. If the Earn-Out Notice provides that Owners are not entitled to any
      or
      only half of the Earn-Out Payment, and the Owner Representative disagrees with
      Purchaser’s determination, the Owner Representative shall notify the Purchaser
      no later than 30 days after the Earn-Out Notice is delivered of its objections
      and the basis therefor. If an objection is made, the Purchaser and the Owner
      Representative will negotiate in good faith to reach an agreement regarding
      the
      matters in dispute. Purchaser agrees to provide the Owner Representative
      promptly upon request with all documents and work papers related to Purchaser's
      determination of EBITDA for the Earn-Out Period. If the Purchaser and the Owner
      Representative, notwithstanding such good faith effort, fail to resolve all
      matters in dispute within 30 days after the Owner Representative advises the
      Purchaser of its objections (the "Resolution
      Period"),
      then
      any remaining disputed matters will be submitted by the Purchaser and the Owner
      Representative to Grant Thornton or another mutually acceptable independent
      accounting firm (the “Neutral
      Auditor”)
      for a
      determination resolving such amounts and issues. Each party agrees to execute,
      if requested by the Neutral Auditor, a reasonable engagement letter with respect
      to the determination to be made by the Neutral Auditor. All fees and expenses
      relating to the work, if any, to be performed by the Neutral Auditor shall
      be
      borne by the party that does not prevail in such dispute (i.e., if the Owners
      are awarded any portion of the Earn Out Payment not already paid by Purchaser
      then such fees and expenses will be borne by the Purchaser, and if it is finally
      determined that the Owners are not owed any, or any additional Earn-Out Payment,
      then such fees and expenses shall be borne by the Owners pro rata based on
      the
      Payment Factor). Except as provided in the preceding sentence, all other costs
      and expenses incurred by the parties in connection with resolving any dispute
      hereunder before the Neutral Auditor shall be borne by the party incurring
      such
      cost and expense. The Neutral Auditor shall determine only those issues still
      in
      dispute at the end of the Resolution Period and the Neutral Auditor’s
      determination shall be based upon and consistent with the terms and conditions
      of this Agreement. The determination by the Neutral Auditor shall be based
      solely on presentations with respect to such disputed items by the Purchaser
      and
      the Owner Representative to the Neutral Auditor and not on the Neutral Auditor’s
      independent review. The Purchaser and the Owner Representative shall use their
      reasonable best efforts to make their respective presentations as promptly
      as
      practicable following submission to the Neutral Auditor of the disputed items,
      and each such party shall be entitled, as part of its presentation, to respond
      to the presentation of the other party and any questions and requests of the
      Neutral Auditor. In deciding any matter, the Neutral Auditor (i) shall be
      bound by the provisions of this Section 3.2(b) and (ii) may not assign
      a value to any item greater than the greatest value for such item claimed by
      either the Purchaser or the Owner Representative or less than the smallest
      value
      for such item claimed by the Purchaser or the Owner Representative. The Neutral
      Auditor’s determination shall be made within 45 days after its engagement (which
      engagement shall be made no later than five (5) Business Days after the end
      of
      the Resolution Period), or as soon thereafter as possible, shall be set forth
      in
      a written statement delivered to the Purchaser and the Owner Representative
      and
      shall be final, conclusive, non-appealable and binding for all purposes
      hereunder; provided
      that
      such determination may be reviewed, corrected or set aside by a court of
      competent jurisdiction but only if upon a finding that the Neutral Auditor
      committed manifest error with respect to its determination. The determination
      of
      the Neutral Auditor shall not be deemed an award subject to review under the
      Federal Arbitration Act or any other statute.

     

    
      
        
        

      

      
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    (c) Covenants
      Regarding Earn-Out.
      After
      the Closing and until the end of the Earn-Out Period:

     

    (i) Purchaser
      shall, and shall cause the Company, to operate their respective businesses
      in a
      manner reasonably consistent with past practices of Purchaser and Company,
      as
      applicable, but taking into account the acquisition of the Company by the
      Purchaser as a wholly-owned subsidiary of the Purchaser, changes in the
      administrative operations of the Company as a result of such acquisition, and
      other changes reasonably related to the Company being a wholly-owned subsidiary
      of the Purchaser; provided, however, that Purchaser shall not cause the Company
      to pay a management fee or other payment to Purchaser or any Affiliate of
      Purchaser unless such amount is excluded from the computation of EBITDA. The
      Purchaser shall, and shall cause the Company to, remain in material compliance
      with all applicable Laws (including but not limited to the Federal Acquisition
      Regulations) and shall not take any action with the purpose or effect of causing
      Purchaser to not be required to pay the Earn-Out Payment to Owners.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    (ii) In
      the
      event, that during the Earn-Out Period, the Purchaser or the Company determines
      to sell, transfer, assign or otherwise dispose of (directly or indirectly)
      any
      assets used primarily in the businesses of Company and Purchaser (other than
      any
      of Purchaser's Affiliates, in which event the EBITDA arising from such assets
      shall be allocated to Company and Purchaser for purposes of calculating whether
      the targets described in Section 3.2(a)
      were
      achieved), or consummate a Change of Control, then the Purchaser shall pay
      to
      the Owners in cash the full Earn-Out Payment.

     

    3.3. Form
      of Payments. 

     

    (a) All
      payments of cash under this Agreement and the Note shall be made in United
      Stated Dollars by delivery to the recipient by depositing, by bank wire
      transfer, the required amount (in immediately available funds) in an account
      of
      the recipient, which account shall be designated by the recipient in writing
      at
      least three (3) Business Days prior to the date of the required payment and
      all
      payments of Purchaser Stock shall be made by delivery of a certificate
      representing the number of Purchaser Shares to be received by each Owner to
      the
      address designated by each Owner on Schedule
      O.
      In the
      case of all payments to be made to the Owners under this Agreement or the Escrow
      Agreement, either cash or Purchaser Shares, each Owner shall receive an amount
      equal to the aggregate payment multiplied by the Payment Factor. 

     

    (b) The
      Owner
      Representative has established a separate bank account for the Cash and the
      cash
      portion of any payments to be made to the Owners under this Agreement. Prior
      to
      the distribution of the Cash and the cash portion of any payments to be made
      to
      the Owners under this Agreement, the Owner Representative shall pay from such
      amounts the Company Expenses, with each Owner receiving an amount equal to
      the
      balance multiplied by the Payment Factor.

     

    3.4. Escrow.
      

     

    (a) To
      secure
      the indemnification obligations of Owners set forth in Article
      10,
      Purchaser and each Owner shall at the Closing execute an Escrow Agreement,
      a
      form of which is attached to this Agreement as Exhibit D (the “Escrow
      Agreement”),
      which
      provides for Three Hundred and Fifty Thousand Dollars ($350,000) and 5,833,333
      Purchaser Common Shares to be held in escrow following the Closing Date (the
      "Escrow
      Deposit").
      Any
      balance of the Escrow Deposit remaining and due to the Owners in accordance
      with
      this Agreement and the Escrow Agreement, plus any interest or income earned
      on
      such Escrow Deposit that has not been so paid, by the date that is eighteen
      (18)
      months after the Closing Date, less any amounts necessary to secure any timely
      asserted and pending but unresolved Purchaser claims for indemnification
      pursuant to Article
      10
      shall be
      paid to the Owners within thirty (30) days of the date that is eighteen (18)
      months after the Closing Date (the "Escrow
      Balance").
      Each
      Owner shall be paid an amount equal to the Escrow Balance, multiplied by the
      Payment Factor. 

     

    (b) Each
      Owner's aggregate Closing Payment to be received at Closing shall be reduced
      by
      the amount equal to the Escrow Deposit multiplied by the Payment
      Factor. 

     

    
      
        
        

      

      
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    (c) To
      secure
      the payment obligations of Purchaser under the Note, Purchaser and each Owner
      shall at the Closing execute a Pledge Agreement, a form of which is attached
      to
      this Agreement as Exhibit E (the “Pledge
      Agreement”),
      which
      provides for 3,050 of the Transferred Shares to be delivered to Michael J.
      Stutman, Esq., of Shaiman, Drucker, Beckman, Sobel & Stutman,
      LLP, to
      be
      held in escrow following the Closing Date until payment in full by Purchaser
      of
      the Note.

     

    

    3.5. Options.
      As soon
      as practicable following the date of this Agreement, each holder of Company
      options outstanding as of the date hereof shall have the option to exercise
      such
      option in full (contingent upon the consummation of the transactions
      contemplated hereunder) and join in this Agreement as an Owner hereunder and
      Schedule
      O
      shall be
      updated accordingly. Each Company option shall terminate to the extent not
      exercised prior to the Effective Time.

     

    3.6. Other
      Company Shareholders.
      As soon
      as practicable following the date of this Agreement, the Company will solicit
      the consent and joinder in this Agreement as an Owner hereunder of Thomas
      Aylesworth, Darrell Berger, Markus Litscher and Lino Ricciardi and Schedule
      O
      shall be
      updated accordingly. 

     

    ARTICLE
      4

    REPRESENTATIONS
      AND WARRANTIES OF

    THE
      COMPANY AND THE OWNERS

     

    The
      Company and the Owners hereby jointly and severally represent and warrant to
      Purchaser as of the date of this Agreement and as of the Closing Date except
      to
      the extent that a representation, warranty or disclosure schedule expressly
      states that such representation or warranty, or information in such disclosure
      schedule, is current only as the date of this Agreement or of an earlier date
      as
      follows: 

     

    4.1. Capacity.
      Each
      Owner has full capacity to execute and deliver this Agreement and the
      Transaction Documents to be executed and delivered by such Owner and to perform
      such Owner’s obligations under this Agreement and such Transaction Documents to
      which such Owner is a party. The Agreement and the Transaction Documents to
      which it is a party have been duly executed and delivered by or on behalf of
      each Owner and constitute the legal, valid and binding obligation of each Owner,
      enforceable against such Owner in accordance with their terms except as
      enforceability may be limited by bankruptcy, insolvency or other laws affecting
      creditors’ rights generally and the exercise of judicial discretion in
      accordance with general equitable principles.

     

    4.2. Noncontravention
      by the Owners.
      Except
      as set forth on Schedule 4.2
      hereto,
      the execution, delivery and performance of this Agreement and the Transaction
      Documents by each of the Owners, and the consummation of the transactions
      contemplated by this Agreement and the Transaction Documents by the Owners
      do
      not (a) require any action by or in respect of, or filing with, any
      Governmental or Regulatory Authority, (b) contravene, violate or constitute
      a breach or default under, any Requirement of Law applicable to the Owners,
      or
      (c) result in the creation of any Encumbrance on the
      Transferred Shares or any of the assets of the Company.

     

    
      
        
        

      

      
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    4.3. Organization;
      Qualification; Good Standing.

     

    (a) The
      Company (i) is a corporation duly organized, validly existing and in good
      standing under the laws of the Commonwealth of Virginia, (ii) has the power
      and
      authority to own and operate its properties and assets and to transact its
      business as currently conducted, and (iii) is duly qualified and authorized
      to
      do business and is in good standing in all jurisdictions where such
      qualification is required by Requirement of Law, which jurisdictions are listed
      on Schedule 4.3(a),
      except
      for those jurisdictions in which failure to do so would not have a Company
      Material Adverse Effect.

     

    (b) There
      is
      no Legal Proceeding or Order pending or, to the Knowledge of the Company,
      threatened against or affecting the Company revoking, limiting or curtailing,
      or
      seeking to revoke, limit or curtail the Company’s power, authority or
      qualification to own, lease or operate its properties or assets or to transact
      the Business.

     

    4.4. Authority;
      Binding Agreement. The
      execution, delivery and performance of this Agreement and the Transaction
      Documents to which it is a party by the Company have been duly authorized by
      all
      requisite action on the part of the Company, and have been duly executed and
      delivered by or on behalf of the Company and constitute the legal, valid and
      binding obligation of the Company, enforceable against the Company in accordance
      with their terms, except as enforceability may be limited by bankruptcy,
      insolvency or other laws affecting creditors’ rights generally and the exercise
      of judicial discretion in accordance with general equitable
      principles.

     

    4.5. Noncontravention
      by Company.
      Except
      as set forth on Schedule 4.5,
      the
      execution, delivery and performance of this Agreement and the other Transaction
      Documents and the consummation of the transactions contemplated by this
      Agreement and the Transaction Documents by the Company and the Owners do not,
      with respect to the Company: (a) require any action by or in respect of, or
      filing with, any Governmental or Regulatory Authority, (b) contravene,
      violate or constitute a breach or default under any Requirement of Law
      applicable to the Company or the Company’s properties or any Material Contract
      to which the Company or the Company’s properties is bound or subject, (c)
      contravene, violate or constitute, whether with or without the passage of time
      or the giving of notice or both, a breach or default under, the Company’s
      certificate of incorporation, bylaws or other governing documents, or any
      material Requirement of Law applicable to the Company or any of its properties
      or any Material Contract to which the Company or any of its properties is bound
      or subject, or (d) other than as provided under the Transaction Documents,
      result in the creation of any Encumbrance on the Company’s assets.

     

    4.6. Capitalization.

     

    The
      Owners are the beneficial and record owners of the Transferred Shares. All
      of
      the issued and outstanding shares of capital stock of the Company are validly
      issued, fully paid and non-assessable and have not been issued in violation
      of
      any preemptive rights or other rights to subscribe for, purchase or otherwise
      acquire securities.
      Except
      as set forth on Schedule
      4.6(a),
      there
      are no outstanding subscriptions, warrants, options, rights, agreements,
      convertible securities or other commitments or instruments pursuant to which
      either Company is or may become obligated to issue or sell shares of its capital
      stock.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    4.7.
      Title.
      Except
      as set forth in Schedule 4.7,
      Company
      is the sole and exclusive owner of, and has good and marketable title to, all
      of
      the Company’s assets, wherever located, free and clear of all Encumbrances of
      any kind or nature whatsoever.

     

    4.8. Legal
      Proceedings.

     

    (a) Owners.
      There
      is no Legal Proceeding or Order pending against or, to the Knowledge of the
      Company, threatened against or affecting, either of the Owners or any of their
      respective properties or otherwise, that could adversely affect or restrict
      the
      ability of the Owners to consummate fully the transactions contemplated by
      this
      Agreement or that in any manner could draw into question the validity of this
      Agreement.

     

    4.9. Compliance
      with Laws.
      To the
      Company's Knowledge, Company at all times since its incorporation has been
      operating, in all material respects, in compliance with all Requirements of
      Law
      applicable to it or any of its properties or to which it or its properties
      is
      bound or subject. The Company has not received any written notice from any
      Person concerning alleged violations of, or the occurrence of any events or
      conditions resulting in alleged noncompliance with, any Requirement of Law
      applicable to the Company or any of its properties are bound or subject. Neither
      the Company, nor, in connection with the conduct at the Business, the Owners
      or
      any of their respective Affiliates has made any illegal kickback, bribe, gift
      or
      political contribution to or on behalf of any customer, or to any officer,
      director, employee of any customer, or to any other Person.

     

    4.10. Labor/Employee
      Matters.

     

    (a) Schedule 4.10(a)
      attached
      hereto is a complete and accurate list of all consulting or similar Contracts
      to
      which the Company is a party or may otherwise be bound or subject, and the
      compensation to which each consultant is entitled under its respective Contract.
      The Company delivered or caused to be delivered to Purchaser true and complete
      copies of all such Contracts. No individuals retained by the Company as an
      independent contractor or consultant would be reclassified by the IRS, the
      U.S.
      Department of Labor or any other Governmental or Regulatory Authority as an
      employee of the Company for any purpose whatsoever.

     

    (b) Schedule 4.10(b)
      hereto
      is a complete and accurate list of the name of each employee of the Company,
      together with such employee’s current position or function, the current rate of
      hourly, monthly or annual compensation (as the case may be), and any
      compensation increase and bonuses since December 31, 2005, none of which are
      outside of the ordinary course of business or inconsistent with the normal
      course of business or past practices of Company. Schedule 4.10(b)
      also
      identifies those employees with whom the Company has entered into an employment
      Contract limiting, restricting or qualifying the Company’s right to alter the
      terms and conditions of employment and terminate employment at the Company’s
      will or a Contract obligating the Company to pay severance or similar payments
      to any employee upon termination of employment for any reason. Company has
      delivered to Purchaser true and complete copies of the Contracts identified
      on
Schedule
      4.10(b).

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

       

    

    (c) To
      Company's Knowledge, there are no threatened or contemplated attempts to
      organize for collective bargaining purposes any of the employees of, or other
      Persons engaged by, the Company. The Company is not a party to or bound by
      any
      collective bargaining agreement or similar Contract and no collective bargaining
      agreement or similar Contract covering any of the Company’s employees or other
      Persons engaged by Company is currently being negotiated.

     

    (d) To
      the
      Knowledge of the Company, no employee of the Company is a party to any Contract
      with any Person who is a former employer of such employee (other than the
      Company), which Contract would limit or restrict the ability of such employee
      to
      perform his or her duties for Purchaser in the ordinary course of
      business.

     

    (e) The
      Company has complied in all material respects with all applicable Requirements
      of Law relating to the employment of its employees. The Company has not received
      written notice of the intent of any Governmental or Regulatory Authority
      responsible for the enforcement of Requirements of Law relating to labor or
      employment matters to conduct an investigation with respect to or relating
      to
      the Company and, to the Company's Knowledge, no such investigation is in
      progress.

     

    (f) The
      Company has taken commercially reasonable precautions to prevent disclosure
      of
      its confidential and/or trade secret information.

     

    4.11. Employee
      Benefit Plans.

     

    (a) Schedule 4.11(a)
      hereto
      sets forth a complete and accurate list of the Employee Benefit Plans. With
      respect to each Employee Benefit Plan, the Company has made available to
      Purchaser true and complete copies of (i) the plan document, trust agreement
      and
      any other document (including amendments thereto) governing such Employee
      Benefit Plan, (ii) the summary plan description, (iii) all Form 5500 annual
      reports and attachments filed within the past three years, and (iv) the most
      recent IRS determination letter, if any, for such Employee Benefit
      Plan.

     

    (b) Each
      of
      the Employee Benefit Plans complies in form and has been operated and
      administered in material compliance with their respective terms and all
      applicable Requirements of Law including, without limitation, ERISA and the
      Code.

     

    (c) No
      Employee Benefit Plan (except statutory rights under COBRA) provides post
      retirement medical benefits, post retirement death benefits or any post
      retirement welfare benefits of any kind whatsoever.

     

    (d) The
      Company has not, and will not, make or cause to be made to any current employee,
      and there has not been made to any former employee of the Company, any payment
      in the form of wages or other consideration pursuant to any employment agreement
      or Employee Benefit Plan that was as of the Effective Time in the aggregate
      an
“excess parachute payment” (within the meaning of Section 280G(b) of the
      Code) as a consequence in whole or in part of this Agreement, or thereafter,
      as
      a consequence of any change in the ownership or effective control of the Company
      or any change in the ownership of a substantial portion of the Company’s
      assets.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

       

    

    (e) The
      Company has not maintained and does not maintain any self-insured health,
      medical, dental or similar plans except as set forth in Schedule 4.11(e)
      hereto,
      and the Company has no, and will not have any, liabilities under such fully
      or
      partially self-insured plans for any periods prior to the Effective
      Time.

     

    4.12. Financial
      Statements.

     

    (a) True
      and
      correct copies of the Company’s balance sheets as of March 31, 2004, 2005 and
      2006 and the related statements of operations, for the years then ended,
      together with all proper exhibits, schedules and notes thereto (collectively,
      the “Historical Financial Statements”)
      will
      be made available. 

     

    (b) True
      and
      correct copies of the Company’s internally prepared, unaudited financial
      statements of the Company for each of the months April 2006 through August
      2006, consisting of a balance sheet and the related statements of operations
      and
      cash flows (collectively, the “Interim Financial Statements”)
      will
      be made available.

     

    (c) Except
      as
      disclosed in the Interim Financial Statements or in Schedule 4.12(c)
      hereto,
      since August 30, 2006:

     

    (i) the
      Company has operated in the normal and ordinary course in a manner consistent
      with past practices;

     

    (ii) to
      the
      Company’s Knowledge, there has been no development, event, condition, or
      circumstance that has had or could have a Company Material Adverse
      Effect;

     

    (iii) there
      has
      not been any change in the accounting methods or practices followed by
      Company;

     

    (iv) the
      Company has not sustained any material damage, destruction, theft, loss or
      interference with the Company’s assets or its businesses, whether or not covered
      by insurance;

     

    (v) no
      development, event, condition or circumstance that constitutes, whether with
      or
      without the passage of time or the giving of notice or both, a default under
      any
      of the Company’s outstanding debt obligations has occurred;

     

    (vi) the
      Company has not created, incurred, assumed or guaranteed any indebtedness
      (except for the endorsement of negotiable instruments for deposit or collection
      or similar transactions in the normal and ordinary course of business or
      disclosed) other than for trade indebtedness incurred in the normal and ordinary
      course of business;

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

       

    

    (vii) the
      Company has paid and discharged diligently, in accordance with past practice
      and
      not less than on a timely basis, all of the Company’s payables and other
      Obligations and Liabilities including, without limitation, all accrued
      obligations to pay management or similar fees to any Person;

     

    (viii) the
      Company has not entered into any Contract outside of the ordinary course of
      business which involves either (A) a commitment of any of the Company’s assets
      or the incurrence by the Company of liabilities in any one transaction or series
      of related transactions in excess of $10,000, or (B) involve a term of more
      than
      six (6) months;

     

    (ix) the
      Company has not sold, leased, exchanged, transferred or otherwise disposed
      of,
      or agreed to sell, lease, exchange, transfer or otherwise dispose of, the
      Company’s assets with an individual fair market value of $10,000 or more, except
      for the disposition of obsolete or worn-out equipment, or the sale of Inventory,
      in the normal and ordinary course of business; and

     

    (d) Except
      as
      set forth on Schedule 4.12(d),
      the
      Leased Real Property is suitable to carry out the Business as conducted and
      intended to be conducted thereon, adequately serviced by all utilities and
      services necessary for the conduct of the Business, and, to the Company’s
      Knowledge, in compliance with all applicable laws, rules and
      regulations.

     

    (e) There
      are
      no condemnation, appropriation or other proceedings involving any taking of
      the
      Leased Real Property pending, or to the Knowledge of the Company, threatened,
      against any of the Leased Real Property.

     

    (f) Except
      as
      set forth on Schedule
      4.12(f),
      the
      current use of the Leased Real Property is a permitted under the existing zoning
      and other laws, rules and regulations.

     

    (g) Each
      Property Lease (i) is in full force and effect, (ii) affords the Company
      exclusive possession of the applicable Leased Real Property, and (iii)
      constitutes a valid and binding obligation of, and is enforceable in accordance
      with its terms against, the respective parties thereto, except as enforceability
      may be limited by bankruptcy, insolvency or other laws affecting creditors’
rights generally and the exercise of judicial discretion in accordance with
      general equitable principles. Notwithstanding the generality of the foregoing,
      the Company has the current right under the Property Leases to the exclusive
      and
      peaceful possession of the Leased Real Property and their use in the Business
      in
      accordance with the terms and conditions of the applicable Property
      Lease.

     

    4.13. Contracts.

     

    (a) Schedule 4.13(a)
      is a
      complete and accurate list of each Contract, other than such Contracts described
      on other Company disclosure schedules hereto, described below to which the
      Company or any of its properties is party or is otherwise bound or subject
      (each, a “Material Contract”):

     

    (i) all
      Contracts relating to the performance of services or the sale of products by
      the
      Company;

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

       

    

    (ii) all
      Contracts relating to the acquisition or the divestiture of fixed assets,
      including intangible assets, physical fixed assets (with the exception of real
      estate and real estate-like rights) and financial assets;

     

    (iii) the
      Property Leases and all other lease or rental Contracts (whether for real or
      personal property);

     

    (iv) all
      Contracts that provide a license of Intellectual Property entered into by the
      Company, whether as licensor or licensee, other than licenses to use software
      available over the counter;

     

    (v) all
      employment Contracts and all Contracts with advisors or consultants to the
      extent that they involve annual payments exceeding $10,000;

     

    (vi) all
      Contracts relating to fringe benefits, profit sharing, commissions, or bonuses
      as well as similar agreements;

     

    (vii) all
      Contracts that purport to or have the effect of limiting the Company’s right to
      engage in, or compete with any Person in any business; and 

     

    (viii) all
      Contracts which have been entered into or assumed outside the ordinary course
      of
      the Business.

     

    4.14. Insurance. Schedule 4.14
      hereto
      is a complete and accurate list of all insurance policies held by the Company
      identifying all of the following for each such policy: (a) the type of
      insurance; (b) the insurer; (c) the policy number; (d) the applicable policy
      limits, (e) the applicable periodic premium; and (f) the expiration date. Each
      such insurance policy is valid and binding and is and has been in effect since
      the date of its issuance. All premiums due thereunder have been paid or will
      be
      paid in the ordinary course of business, and neither the Company nor either
      of
      the Owners has received any notice of any cancellation, non-renewal or
      termination in respect of any such policy. The Company is not in default under
      any such policy. To the Knowledge of the Company, no such insurer is the subject
      of insolvency proceedings. The Company has not received written notice that
      any
      insurer under any policy referred to in this Section 4.14
      is
      denying liability with respect to a claim thereunder or defending under a
      reservation of rights clause. The Company has notified its insurance carriers
      of
      all litigation, claims and facts which could reasonably give rise to a claim,
      all of which are disclosed in Schedule 4.14.
      

     

    4.15. Intellectual
      Property.

     

    (a) Schedule 4.15(a)
      hereto
      is a complete and accurate list of all of the Company’s registered patents,
      patent applications, copyright registrations, copyright applications, trademark
      registrations and trademark applications, both domestic and foreign, together
      with the: (i) applicable registration number; (ii) filing, registration, issue
      or application date; (iii) record owner; (iv) country; and (v) title or
      description. 

     

    (b) There
      is
      neither pending, nor to the Company’s Knowledge, threatened, any Legal
      Proceeding against the Company contesting the validity or right of the Company
      to register or use any of it's Intellectual Property, and the Company has not
      received any written notice of infringement upon or conflict with any asserted
      right of others nor, to the Company’s Knowledge, is there a valid basis for such
      a notice.

     

    
      
        
        

      

      
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    (c) Except
      as
      otherwise provided in the applicable Contracts that provide a license of
      Intellectual Property identified as such in Schedule 4.15(a),
      the
      Company has no obligation to compensate others for the use of any Intellectual
      Property. In addition, except as otherwise provided on Schedule 4.15(a),
      the
      Company has not granted to any other Person any license or other right to use,
      in any manner, any of the Intellectual Property used by the Company in
      connection with the Business, whether or not requiring the payment of
      royalties.

     

    4.16. Taxes
      and Tax Returns. 

     

    (a) The
      Company has duly and timely filed all Tax Returns required to be filed by the
      Company. Each such Tax Return was true, correct and complete. The Company has
      paid in full all Taxes due and payable, or asserted or claimed to be due and
      payable by any Tax Authority from the Company, whether or not shown on any
      Tax
      Return.

     

    (b) The
      Company has complied with all applicable Requirements of Law relating to the
      payment and withholding of Taxes (including, without limitation, withholding
      of
      Taxes pursuant to Sections 1441 and 1442 of the Code, or similar provisions
      under any foreign Requirements of Law) and has, within the time and in the
      manner prescribed by applicable Requirements of Law, withheld from employee
      wages and paid over, in a timely manner, to the proper Taxing Authorities all
      amounts required to be so withheld and paid over under applicable Requirements
      of Law.

     

    (c) No
      deficiency for any Taxes has been proposed, asserted or assessed against the
      Company that has not been resolved and paid in full or fully reserved for and
      identified on the Company’s balance sheet included in the Interim Financial
      Statements. The Company has not received any outstanding and unresolved written
      notices from the IRS or any other Taxing Authority of any proposed examination
      or of any proposed change in reported information relating to the Company.
      Except as set forth in Schedule
      4.16
      attached
      hereto (which sets forth the nature of the proceeding, the type of Tax Return,
      the deficiencies proposed or assessed and the amount thereof, and the taxable
      year in question), no Legal Proceeding or audit or similar foreign proceedings
      is pending with regard to the Company’s Taxes or Tax Returns.

     

    (d) No
      waiver, extension or comparable consent given by the Company regarding the
      application of the statute of limitations with respect to any Taxes or Tax
      Returns is outstanding, nor, to the Knowledge of the Company, is any request
      for
      any such waiver, extension or consent pending.

     

    (e) There
      are
      no Encumbrances of any kind for Taxes upon any of the Company’s assets or
      properties other than for those Encumbrances for Taxes not yet due and
      payable.

     

    (f) The
      Company has not requested any extension of time within which to file any Tax
      Return, which Tax Return has not since been filed.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (g) The
      Company is not a party to any Contract providing for the allocation or sharing
      of Taxes. The Company has not filed a consent under Section 341(f) of the
      Code.

     

    (h) The
      Company has not agreed to make, nor is it required to make, any adjustment
      under
      Section 481(a) of the Code for any period ending after the Effective Time by
      reason of a change in accounting method or otherwise and the Company does not
      have any Knowledge that the IRS has proposed such adjustment or change in
      accounting method.

     

    (i) None
      of
      Company’s assets or properties is required to be treated as owned by any other
      person pursuant to the “safe harbor lease” provisions of former Section
      168(f)(8) of the Code.

     

    (j) The
      Company has no permanent establishment located in any tax jurisdiction other
      than the United States, and is not liable for the payment of Taxes levied by
      any
      jurisdiction located outside the United States.

     

    (k) To
      the
      Company’s Knowledge, no state of facts exists or has existed that would
      constitute grounds for the assessment of Tax liability with respect to periods
      that have not been audited by the IRS or any other Taxing
      Authority.

     

    (l) The
      unpaid Taxes of the Company (i) did not, as of March 31, 2006, exceed
      the reserve for Tax liability (rather than any reserve for deferred Taxes)
      on
      the most recent balance sheet included in the Interim Financial Statements,
      and
      (ii) will not exceed the reserve as adjusted for the passage of time through
      the
      Effective Time.

     

    (m) All
      transactions that could give rise to an understatement of federal income tax
      (within the meaning of Section 6662 of the Code) have been adequately disclosed
      on the Company’s Tax Returns in accordance with Section 6662(d)(2)(B) of
      the Code.

     

    (n) No
      indebtedness of the Company is “corporate acquisition indebtedness” within the
      meaning of Section 279(b) of the Code.

     

    (o) The
      Company has no liability for the Taxes of any Person (other than the Company)
      under Treasury Regulation Section 1.1502-6 (or any similar provision of state,
      local or foreign law) as a transferee or successor, by Contract, or
      otherwise.

     

    4.17. Accounts. Schedule 4.17
      herein
      completely and accurately states the names and addresses of each bank, financial
      institution, fund, investment or money manager brokerage house and similar
      institution in which the Company maintains any account (whether checking,
      savings, investment, trust or otherwise), lock box, or safe deposit box, and
      the
      account numbers and name of the persons having authority to affect transactions
      with respect thereto or other access thereto. 

     

    4.18. Receivables. Schedule
      4.18
      is a
      schedule of Company’s Receivables, updated as of the Closing Date. Assuming
      reasonable commercial efforts by Purchaser to collect such Company Receivables
      and Purchaser’s compliance with all applicable contract terms with respect to
      each such Company Receivables. Except as set forth on Schedule 4.18,
      the
      Company has not written-off any Company Receivables since June 30, 2006. The
      Company Receivables arose from bona fide transactions in the normal and ordinary
      course of the Business and reflect credit terms consistent with the Company’s
      past practice. Assuming
      reasonable commercial efforts by Purchaser to collect such Company Receivables
      and Purchaser’s compliance with all applicable contract terms with respect to
      each such Company Receivable, the Company Receivables will be collectible in
      accordance with their terms in the aggregate amount shown, less any allowances
      for doubtful accounts reflected therein, calculated in a manner consistent
      with
      the allowance reflected in the Interim Financial Statements.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    4.19. Inventory. All
      Inventory reflected on the Company’s most recent balance sheet in the Interim
      Financial Statements delivered to Purchaser and in the Company’s Books and
      Records (a) was purchased or acquired and is maintained in the normal and
      ordinary course of the Business, (b) has been reflected on such Books and
      Records at a value equal to the wholesale market value thereof as of the date
      of
      purchase. 

     

    4.20. Prepayment
      of Indebtedness.
      Except
      as set forth on Schedule 4.20,
      all
      Obligations and Liabilities of the Company with respect to any outstanding
      Indebtedness or other obligations may be prepaid by the Company at any time,
      without any interest (other than accrued or unpaid interest on outstanding
      principal at the non-default interest rate provided for in the Contract
      governing such indebtedness or obligations), charge, penalty, premium, fee
      or
      other amount.

     

    4.21. No
      Other Agreements to Sell.
      Neither
      the Company nor any of the Owners has granted, and there is not outstanding
      any
      option, right, agreement, Contract or other obligation or commitment pursuant
      to
      which any other Person could claim a right to acquire in any way any ownership
      or other material interest in the Company or any of the Transferred
      Shares.

     

    4.22. Directors
      and Officers. Schedule 4.22
      hereto
      sets forth an accurate and complete list of the Company’s directors and
      officers.

     

    4.23.
      Disclosure
      Generally.
      The
      representations, warranties and disclosures contained in this Article
      4,
      as
      modified by the disclosure schedules to this Article
      4,
      do not
      contain any untrue statement of material fact or omit to state any material
      fact
      necessary in order to make any such representations, warranties or disclosures,
      in light of the circumstances in which they were made, not misleading.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      5

    REPRESENTATIONS
      AND WARRANTIES OF PURCHASER

     

    The
      Purchaser represents and warrants to the Company and the Owners as of the date
      of this Agreement and as of the Closing Date except to the extent that a
      representation, warranty or disclosure schedule expressly states that such
      representation or warranty, or information in such disclosure schedule, is
      current only as the date of this Agreement or of an earlier date as follows:
      

     

    5.1. Organization.

     

    (a) Purchaser
      i)
      is a
      corporation duly incorporated, validly existing and in good standing under
      the
      laws of the State of Delaware, ii)
      has the
      corporate power and authority to own and operate its properties and assets
      and
      to transact its business as currently conducted, and iii)
      is duly
      qualified and authorized to do business and is in good standing in all
      jurisdictions where the failure to be duly qualified, authorized and in good
      standing would have a material adverse effect upon Purchaser’s businesses,
      prospects, operations, results of operations, assets, liabilities or condition
      (financial or otherwise).

     

    (b) There
      is
      no Legal Proceeding or Order pending or, to the Knowledge of Purchaser,
      threatened against or affecting Purchaser revoking, limiting or curtailing,
      or
      seeking to revoke, limit or curtail Purchaser’s power, authority or
      qualification to own, lease or operate its properties or assets or to transact
      its business.

     

    5.2. Authority;
      Binding Agreement.
      The
      execution, delivery and performance of this Agreement and the Transaction
      Documents by the Purchaser have been duly authorized by all requisite action
      on
      the part of the Purchaser, and have been duly executed and delivered by or
      on
      behalf of the Purchaser and constitute the legal, valid and binding obligation
      of the Purchaser, enforceable against the Purchaser in accordance with their
      terms except as enforceability may be limited by bankruptcy, insolvency or
      other
      laws affecting creditors’ rights generally and the exercise of judicial
      discretion in accordance with general equitable principles.

     

    5.3. Noncontravention
      by Purchaser.
      Except
      as set forth on Schedule 5.3,
      the
      execution, delivery and performance of this Agreement and the other Transaction
      Documents and the consummation of the transactions contemplated by this
      Agreement and the Transaction Documents by the Purchaser do not:
      (a) require any action by or in respect of, or filing with, any
      Governmental or Regulatory Authority, (b) contravene, violate or constitute
      a breach or default under any Requirement of Law applicable to the Purchaser
      or
      the Purchaser's properties or any Purchaser Material Contract to which the
      Purchaser or the Purchaser’s properties is bound or subject, (c) contravene,
      violate or constitute, whether with or without the passage of time or the giving
      of notice or both, a breach or default under, the Purchaser’s certificate of
      incorporation, bylaws or other governing documents, or any material Requirement
      of Law applicable to the Purchaser or any of its properties or any Purchaser
      Material Contract to which the Purchaser or any of its properties is bound
      or
      subject, or (d) other than as provided under the Transaction Documents, result
      in the creation of any Encumbrance on the Purchaser’s assets.

     

    5.4. Capitalization.
      

     

    (a) The
      outstanding capital stock of Purchaser prior to Closing consists of 113,980,767
      Purchaser Common Shares, no Purchaser Preferred Shares and no other series
      or
      class of Purchaser preferred stock. Schedule 5.4
      sets
      forth, as of the date hereof, all of the issued and outstanding capital stock,
      by class and/or series, and all issued and outstanding options and warrants
      to
      purchase capital stock of Purchaser (collectively, "Purchaser
      Equity")
      and
      the owners of record of such Purchaser Equity. Except as set forth on
Schedule 5.4,
      there
      are no outstanding or authorized stock appreciation, phantom stock or similar
      rights with respect to Purchaser, nor are there any voting trusts, proxies,
      shareholder agreements or any other agreements or understandings with respect
      to
      the voting of the Purchaser Equity. Except as set forth on Schedule 5.4,
      there
      are no options, warrants or other rights to subscribe for or purchase any
      capital stock or other equity interests of Company or securities convertible
      into or exchangeable for, or that otherwise confer on the holder any right
      to
      acquire any Purchaser Equity, or preemptive rights or rights of first refusal
      or
      first offer nor are there any contracts, commitments, agreements,
      understandings, arrangements or restrictions to which Purchaser is a party
      or by
      which Purchaser is bound relating to any shares of Purchaser Equity, whether
      or
      not outstanding. 

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

       

    

    (b) All
      issued and outstanding shares of Parent have been duly authorized and validly
      issued, are fully paid and nonassessable, and were issued in compliance with
      all
      applicable Requirements of Law concerning the issuance of securities.
The
      Purchaser Shares to be issued to the Owners pursuant to this Agreement, and
      the
      shares of common stock issuable upon conversion of the Purchaser Preferred
      Shares (the "Conversion
      Shares")
      will
      be upon issuance or conversion, as the case may be, duly authorized, validly
      issued, fully paid and nonassessable, free and clear of all Encumbrances, and
      not subject to or issued in violation of any purchase option, call option,
      right
      of first refusal, preemptive right, subscription right or any similar right
      under any Requirement of Law or Purchaser's certificate of incorporation, as
      amended.

     

    (c) The
      rights, preferences, privileges and restrictions of the Purchaser Shares and
      Conversion Shares are as stated in the Restated Charter. The Purchaser Preferred
      Shares are convertible into common stock of Purchaser on a one (1) for eight
      and
      one-thirds (8 1/3)
      basis
      as of the date hereof and the consummation of the transactions contemplated
      hereunder will not result in any anti-dilution adjustment or other similar
      adjustment to the outstanding shares of preferred stock of Purchaser. The
      Conversion Shares have been duly and validly reserved for issuance.

     

    5.5. Title.
      Except
      as set forth in Schedule 5.5,
      Purchaser is the sole and exclusive owner of, and has good and marketable title
      to, all of the Purchaser’s assets, wherever located, free and clear of all
      Encumbrances of any kind or nature whatsoever.

     

    5.6. Legal
      Proceedings.

     

    There
      is
      no Legal Proceeding or Order pending against or, to the Knowledge of Purchaser,
      threatened against or affecting, Purchaser or its Affiliates, or any of their
      respective properties or otherwise, that could adversely affect or restrict
      the
      ability of Purchaser to consummate fully the transactions contemplated by this
      Agreement or that in any manner could draw into question the validity of this
      Agreement.

     

    5.7. Compliance
      with Laws.
      To the
      Purchaser’s Knowledge, Purchaser and its Affiliates at all times since their
      respective incorporation has been operating, in all material respects, in
      compliance with all Requirements of Law applicable to it or any of its
      properties or to which it or its properties is bound or subject. Neither
      Purchaser nor any of its Affiliates has received any written notice from any
      Person concerning alleged violations of, or the occurrence of any events or
      conditions resulting in alleged noncompliance with, any Requirement of Law
      applicable to the Purchaser or any of its Affiliates or any of their respective
      properties are bound or subject. Neither the Purchaser nor any of its Affiliates
      has made any illegal kickback, bribe, gift or political contribution to or
      on
      behalf of any customer, or to any officer, director, employee of any customer,
      or to any other Person.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    5.8. Taxes
      and Tax Returns.
      

     

    (a) 
      The
      Purchaser has duly and timely filed all Tax Returns required to be filed by
      the
      Purchaser. Each such Tax Return was true, correct and complete. The Purchaser
      has paid in full all Taxes due and payable, or asserted or claimed to be due
      and
      payable by any Tax Authority from the Purchaser, whether or not shown on any
      Tax
      Return.

     

    (b) The
      Purchaser has complied with all applicable Requirements of Law relating to
      the
      payment and withholding of Taxes (including, without limitation, withholding
      of
      Taxes pursuant to Sections 1441 and 1442 of the Code, or similar provisions
      under any foreign Requirements of Law) and has, within the time and in the
      manner prescribed by applicable Requirements of Law, withheld from employee
      wages and paid over, in a timely manner, to the proper Taxing Authorities all
      amounts required to be so withheld and paid over under applicable Requirements
      of Law.

     

    (c) No
      deficiency for any Taxes has been proposed, asserted or assessed against the
      Purchaser that has not been resolved and paid in full or fully reserved for
      and
      identified on the Purchaser’s balance sheet included in the Purchaser Interim
      Financial Statements. The Purchaser has not received any outstanding and
      unresolved written notices from the IRS or any other Taxing Authority of any
      proposed examination or of any proposed change in reported information relating
      to the Purchaser. Except as set forth in Schedule
      5.14
      attached
      hereto (which sets forth the nature of the proceeding, the type of Tax Return,
      the deficiencies proposed or assessed and the amount thereof, and the taxable
      year in question), no Legal Proceeding or audit or similar foreign proceedings
      is pending with regard to the Purchaser’s Taxes or Tax Returns.

     

    (d) No
      waiver, extension or comparable consent given by the Purchaser regarding the
      application of the statute of limitations with respect to any Taxes or Tax
      Returns is outstanding, nor, to the Knowledge of the Purchaser, is any request
      for any such waiver, extension or consent pending.

     

    (e) There
      are
      no Encumbrances of any kind for Taxes upon any of the Purchaser’s assets or
      properties other than for those Encumbrances for Taxes not yet due and
      payable.

     

    (f) The
      Purchaser has not requested any extension of time within which to file any
      Tax
      Return, which Tax Return has not since been filed.

     

    (g) The
      Purchaser is not a party to any Contract providing for the allocation or sharing
      of Taxes. The Purchaser has not filed a consent under Section 341(f) of the
      Code.

     

    (h) The
      Purchaser has not agreed to make, nor is it required to make, any adjustment
      under Section 481(a) of the Code for any period ending after the Effective
      Time
      by reason of a change in accounting method or otherwise and the Purchaser does
      not have any Knowledge that the IRS has proposed such adjustment or change
      in
      accounting method.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

       

    

    (i) None
      of
      Purchaser’s assets or properties is required to be treated as owned by any other
      person pursuant to the “safe harbor lease” provisions of former Section
      168(f)(8) of the Code.

     

    (j) The
      Purchaser has no permanent establishment located in any tax jurisdiction other
      than the United States, and is not liable for the payment of Taxes levied by
      any
      jurisdiction located outside the United States.

     

    (k) To
      the
      Purchaser’s Knowledge, no state of facts exists or has existed that would
      constitute grounds for the assessment of Tax liability with respect to periods
      that have not been audited by the IRS or any other Taxing
      Authority.

     

    (l) The
      unpaid Taxes of the Purchaser (i) did not, as of June 30, 2006, exceed the
      reserve for Tax liability (rather than any reserve for deferred Taxes) on the
      most recent balance sheet included in the Interim Financial Statements, and
      (ii)
      will not exceed the reserve as adjusted for the passage of time through the
      Effective Time.

     

    (m) All
      transactions that could give rise to an understatement of federal income tax
      (within the meaning of Section 6662 of the Code) have been adequately disclosed
      on the Purchaser’s Tax Returns in accordance with Section 6662(d)(2)(B) of
      the Code.

     

    (n) No
      indebtedness of the Purchaser is “corporate acquisition indebtedness” within the
      meaning of Section 279(b) of the Code.

     

    (o) The
      Purchaser has no liability for the Taxes of any Person (other than the
      Purchaser) under Treasury Regulation Section 1.1502-6 (or any similar provision
      of state, local or foreign law) as a transferee or successor, by Contract,
      or
      otherwise.

     

    5.9. Regulatory
      Filings.
      The
      Purchaser has filed timely all registrations, filings, reports, and submissions
      that are required by any Requirement of Law. All such registrations, filings,
      reports and submissions were made in accordance with applicable Requirements
      of
      Law when filed and all information contained in such registrations, filings,
      reports and submissions was true and complete when made. Since the date of
      any
      such filing, there has been no development, event, condition or circumstance
      that would require the Purchaser to amend or supplement any such registration,
      filing, report or submission or otherwise make any additional registration,
      filing, report or submission. To Purchaser's Knowledge, no deficiencies have
      been asserted by any Governmental or Regulatory Authority with respect to any
      such registrations, filings, reports and submissions that have not been finally
      resolved.

     

    5.10. Inventory.
       All
      Inventory reflected on the Purchaser's most recent balance sheet in the
      Purchaser Interim Financial Statements delivered to Company and in the
      Purchaser's Books and Records (a) was purchased or acquired and is
      maintained in the normal and ordinary course of Purchaser's business, (b) has
      been reflected on such Books and Records at a value equal to the wholesale
      market value thereof as of the date of purchase. 

     

    5.11. Product
      Liability.
      The
      Purchaser has no liability (and, to the Purchaser’s Knowledge, there is no basis
      for any present or future Legal Proceeding or Order against the Purchaser giving
      rise to any liability) arising out of any injury to individuals or property
      as a
      result of the ownership, possession or use of any product sold or delivered
      by
      the Purchaser or its Affiliates. 

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    5.12. No
      Other Agreements to Sell.
      Except
      as set forth on Schedule 5.12,
      Neither
      the Purchaser nor any Affiliate has granted, and there is not outstanding any
      option, right, agreement, Contract or other obligation or commitment pursuant
      to
      which any other Person could claim a right to acquire in any way any ownership
      or other material interest in the Purchaser, any Affiliate or any of the capital
      stock of Purchaser or its Affiliates.

     

    5.13. Directors
      and Officers.
      Schedule 5.13
      hereto
      sets forth an accurate and complete list of the Purchaser’s directors and
      officers.

     

    5.14. Disclosure
      Generally.
      The
      representations, warranties and disclosures contained in this Article 5, as
      modified by the disclosure schedules to this Article 5, do not contain any
      untrue statement of material fact or omit to state any material fact necessary
      in order to make any such representations, warranties or disclosures, in light
      of the circumstances in which they were made, not misleading.

     

    ARTICLE
      6

    GENERAL
      COVENANTS

     

    6.1. Notice
      of Certain Events.

     

    (a) The
      Company and the Owners shall promptly notify Purchaser of and Purchaser shall
      promptly notify Company and the Owners of:

     

    (i) any
      notice or other communication from any Person alleging that the consent of
      such
      Person is or may be required in connection with the transactions contemplated
      by
      this Agreement or the other Transaction Documents;

     

    (ii) any
      notice or other communication from any Governmental or Regulatory Authority
      in
      connection with the transactions contemplated by this Agreement or the other
      Transaction Documents; and

     

    (iii) any
      material claims or legal proceedings commenced or, to their Knowledge
      threatened, relating to or involving or otherwise affecting the Company,
      Purchaser or the Owners and which relates to the consummation of the
      transactions contemplated by this Agreement.

     

    (b) If
      the
      Company acquires Knowledge or the Purchaser acquires Knowledge after the date
      of
      this Agreement of (i) any matter which, if existing, occurring or known at
      the
      date of this Agreement would have been required to be disclosed to Purchaser
      or
      Company and Owners, as the case may be, or (ii) the occurrence of any event
      or
      the failure of any event to occur that may result in the failure to satisfy
      any
      condition specified in Article
      7
      or the
      obligations of any party to consummate the transactions contemplated by this
      Agreement, such party shall, promptly after obtaining such Knowledge, notify
      Purchaser or Owner Representative, as applicable,, in writing in sufficient
      detail to permit a reasonable analysis thereof.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

       

    

    6.2. Confidentiality.

     

    (a) Prior
      to
      the Closing, Purchaser shall hold in confidence, and use its commercially
      reasonable efforts to have all of the officers, managers, independent
      contractors and employees hold in confidence, all knowledge and information
      of a
      secret or confidential nature with respect to the Business and shall not
      disclose, publish or make use of the same without the consent of Company and
      the
      Owner Representative, except to the extent that such information shall have
      become public knowledge other than by breach of this Agreement by Purchaser
      and
      except and to the extent disclosure is required by applicable Requirement of
      Law.

     

    (b) The
      Owners shall hold in confidence all knowledge and information of a secret or
      confidential nature with respect to the Business following the Closing and
      shall
      not disclose, publish or make use of the same without the consent of Purchaser,
      except to the extent that such information shall have become public knowledge
      other than by breach of this Agreement by the Company or the Owners, and except
      and to the extent disclosure is required by applicable Requirement of
      Law.

     

    (c) The
      parties agree that the remedy at law for any breach of this
      Section 6.2
      would be
      inadequate and that the aggrieved party shall be entitled to injunctive relief
      in addition to any other remedy it may have upon breach of any provision of
      this
      Section 6.2.

     

    6.3. Noncompetition. 

     

    (a) Obligation.
      From
      and after the date of Closing, for a period of three (3) years, each of the
      Material Owners agrees that such Material Owner will not, directly or
      indirectly: 

     

    (i) engage
      or
      participate in the Business in the Territory in direct competition with Company
      or Purchaser;

     

    (ii) become
      interested (as owner, stockholder, lender, partner, co-venturer, director,
      shareholder, employee, agent, consultant or otherwise) in any portion of the
      business of any person, firm, corporation, association or other entity located
      or doing business in the Territory other than Purchaser and its Affiliates
      where
      such portion of such business is in or competitive with the Business; provided,
      however, notwithstanding the foregoing, each Material Owner may hold not more
      than two percent (2%) of the outstanding securities of any class of any
      publicly-traded securities of a company that is engaged in activities referenced
      in this Section 6.3(a);

     

    (iii) solicit,
      call on or transact or engage in any direct or indirect business activity,
      for a
      purpose competitive with the Business in the Territory, with any Person;

     

    (iv) influence
      or attempt to influence any current customer or referral source of the Company
      prior to the Closing to terminate or modify any written or oral agreement with
      Purchaser or any of its Affiliates (including the Company after the Closing);
      or

     

    (v) influence
      or attempt to influence any person or entity, for a purpose competitive with
      the
      Business, either (A) to terminate or modify an employment, consulting, agency,
      distributorship or other arrangement with Purchaser or its Affiliates, or (B)
      to
      employ or retain, or arrange to have any other person or entity employ or
      retain, any person who is employed or retained by Purchaser or its
      Affiliates.

     

    
      
        
        

      

      
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    (b) Acknowledgments.
      Each
      Material Owner hereby acknowledges and agrees that:

     

    (1) the
      rights, obligations and duties of such Material Owner under this
      Section 6.3
      are
      necessary for the protection of the legitimate business interests of Purchaser
      at the times set forth in this Section 6.3;
      

     

    (2) the
      agreements of the Material Owners set forth in this Section 6.3
      are an
      integral part of this Agreement, without which transactions contemplated in
      and
      by this Agreement will not close;

     

    (3) the
      scope
      of the obligations set forth in this Section 6.3
      is
      reasonable in time, geography and types and limitations of activities
      restricted; and

     

    (4) the
      breach of this Section 6.3
      will be
      such that the parties’ harmed by such breach will not have an adequate remedy at
      law because of the unique nature of the Business.

     

    (c) Remedy.
      The
      parties acknowledge and agree that the rights of Purchaser pursuant to
      Section 6.3(a)
      are of a
      specialized and unique character and that immediate and irreparable damage
      will
      result to such parties if the obligated parties under such sections fail to
      or
      refuse to perform their obligations thereunder and, notwithstanding any election
      by Purchaser to claim damages from as a result of any such failure or refusal,
      Purchaser may, in addition to any other remedies and damages available, seek
      an
      injunction in a court of competent jurisdiction to restrain any such failure
      or
      refusal. No single exercise of the foregoing remedy shall be deemed to exhaust
      Purchaser’s right to such remedy, but the right to such remedy shall continue
      undiminished and may be exercised from time to time as often as such parties
      may
      elect. 

     

    (d) Early
      Termination.
      The
      restrictive covenants set forth in this Section 6.3 shall terminate
      automatically with respect to Michael Ricciardi and David Godso, respectively,
      if such Owner is terminated from employment by Company and/or Purchaser without
      Cause or such Owner terminates his employment with Company and/or Purchaser
      with
      Good Reason.

     

    6.4. Non-Disparagement.
      Neither
      the Owners nor any of their respective Affiliates, on the one hand, nor
      Purchaser or any of Purchaser’s Affiliates, on the other hand, will, directly or
      indirectly, disparage, deprecate or make any negative comment or interfere
      in
      the business activities of the other or the other’s stockholders, directors,
      managers, members, officers, employees, independent contractors, or
      agents.

     

    6.5. Further
      Assurances.

     

    (a) Subject
      to the terms and conditions herein provided, each of the parties hereto agrees,
      subject to its legal obligations, to use all reasonable commercial efforts
      to
      take, or cause to be taken, all actions and to do, or cause to be done, all
      things necessary, proper or advisable to consummate and make effective the
      transactions contemplated by this Agreement and the other Transaction Documents,
      including to use its commercially reasonable efforts to rectify any event or
      circumstance which would impede the consummation of the transactions
      contemplated hereby.

     

    
      
        
        

      

      
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    (b) Except
      as
      required by law, no party will voluntarily cooperate with any Person which
      may
      hereafter seek to restrain or prohibit or otherwise oppose the transactions
      contemplated by this Agreement and each party will cooperate with the other
      party to resist any such effort to restrain or prohibit or otherwise oppose
      such
      transactions.

     

    6.6. Distribution
      to Owners.
      Immediately prior, or simultaneously with Closing, Company shall distribute
      to
      the Owners all of its Cash pro rata based on the Payment Factor.

     

    ARTICLE
      7

    CONDITIONS
      TO CLOSING

     

    7.7. Conditions
      Precedent to Obligations of
      Purchaser.
      The
      obligations of Purchaser to proceed with the Closing under this Agreement are
      subject to the fulfillment prior to or at Closing of the following conditions
      (any one or more of which may be waived in whole or in part by Purchaser in
      Purchaser’s sole discretion):

     

    (a) Bringdown
      of Representations and Warranties.
      The
      representations and warranties of the Company and the Owners contained in this
      Agreement shall be true and correct in all material respects (without regard,
      for purposes hereof, of any materiality, material adverse effect or similar
      qualifications contained in such representations and warranties) on and as
      of
      the time of Closing,
      except
      for changes contemplated by this Agreement and those representations and
      warranties which address matters only as of a particular date (which shall
      remain true and correct as of such date),
      with
      the same force and effect as though such representations and warranties had
      been
      made on, as of and with reference to such time, and Purchaser shall have
      received a certificate to such effect duly executed by the Company and the
      Owner
      Representative.

     

    (b) Performance
      and Compliance.
      The
      Company and the Owners shall have performed, in all material respects, all
      of
      the covenants and complied, in all material respects, with all of the provisions
      required by this Agreement to be performed or complied with by them on or before
      the Closing, and Purchaser shall have received a certificate to such effect
      duly
      executed by the Company and the Owner Representative.

     

    (c) Satisfactory
      Instruments.
      All
      instruments and documents required on the Company’s and the Owners’ part to
      effectuate and consummate the transactions contemplated hereby, including those
      listed in Section 8.3
      hereof,
      shall be delivered to Purchaser and shall be substantially in the form of the
      Exhibits attached hereto, when applicable.

     

    (d) Required
      Consents.
      All
      Consents of third parties, including, without limitation, all Governmental
      or
      Regulatory Authorities, necessary or appropriate to consummate the transactions
      contemplated hereby and by the Transaction Documents shall have been obtained
      and no such consent or approval (i) shall have been conditioned upon the
      modification in any material respect, cancellation or termination of any
      material lease, commitment, agreement, easement, right, license, Permit or
      authorization of the Company; or (ii) shall impose on Purchaser or the
      Company after the Closing, as applicable, any material condition, provision
      or
      requirement not presently imposed upon it or any condition that would be more
      restrictive on Purchaser or the Company after the Closing, as applicable, after
      the Closing than the conditions presently imposed on the
      Company or either of the Owners before the Closing, as applicable.

     

    
      
        
        

      

      
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    (e) Litigation.
      No
      order of any Governmental or Regulatory Authority shall be in effect which
      restrains or prohibits the transactions contemplated hereby or which would
      limit
      or adversely affect Purchaser’s ownership or control of the Transferred Shares,
      and there shall not have been threatened, nor shall there be pending, any action
      or proceeding by or before any court or Governmental or Regulatory Authority,
      (i) challenging any of the transactions contemplated by this Agreement or
      seeking monetary relief by reason of the consummation of such transactions,
      or
      (ii) by any present or former owner of any capital stock or equity interest
      in the Company (whether through a derivative action or otherwise) against
      the Company or any officer, director, manager or member of the Company in his
      capacity as such, or (iii) which might have a material adverse effect on
      its business, prospects or condition (financial or otherwise) of the
Business
      as transacted prior to Closing.

     

    (f) UCC
      Termination Statements.
      The
      Company shall have delivered to Purchaser Uniform Commercial Code financing
      release or termination statements with respect to all security interests in
      the
      Company’s assets, except for the security interest held by Wachovia Bank.

     

    (g) No
      Material Adverse Change.
      No
      Company Material Adverse Effect shall have occurred since the
      date
      hereof. 

     

    (h) Joinder.
      Thomas
      Aylesworth, Darrell Berger, Markus Litscher, Lino Ricciardi and each holder
      of
      Company options who exercised such options between the date hereof and Closing
      and shall have all joined this Agreement as an Owner hereunder.

     

    7.2. Conditions
      Precedent to the Obligations of the Company
      and the Owners.
      The
      obligations of the Company and the Owners to proceed with the Closing hereunder
      are subject to the fulfillment prior to or at Closing of the following
      conditions (any one or more of which may be waived in whole or in part by the
      Owners in their sole discretion):

     

    (a) Bringdown
      of Representations and Warranties.
      The
      representations and warranties of Purchaser contained in this Agreement shall
      be
      true and correct in all material respects (without regard, for purposes hereof,
      of any materiality, material adverse effect or similar qualifications contained
      in such representations and warranties) on and as of the time of Closing,
except
      for changes contemplated by this Agreement and those representations and
      warranties which address matters only as of a particular date (which shall
      remain true and correct as of such date),
      with
      the same force and effect as though such representations and warranties had
      been
      made on, as of and with reference to such time and Purchaser shall have
      delivered to the Company a certificate to such effect.

     

    (b) Performance
      and Compliance.
      Purchaser shall have performed all of the covenants and complied, in all
      material respects, with all the provisions required by this Agreement to be
      performed or complied with by it on or before the Closing, and Purchaser shall
      have delivered to the Company and Owners a certificate to such
      effect.

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

       

    

    (c) Litigation.
      No
      order of any Governmental or Regulatory Authority shall be in effect which
      restrains or prohibits the transactions contemplated hereby.

     

    (d) Satisfactory
      Instruments.
      All
      instruments and documents required on the part of Purchaser to effectuate and
      consummate the transactions contemplated hereby listed in
      Section 8.2
      hereof
      shall be delivered to the Company and/or the Owners and shall be substantially
      in the form of the Exhibits attached hereto, when applicable.

     

    (e) No
      Material Adverse Effect.
      No
      material adverse effect upon Purchaser’s businesses, prospects, operations,
      results of operations, prospects, assets, liabilities or condition (financial
      or
      otherwise) shall have occurred since the date hereof.

     

    (f) ESOP
      Valuation.
      The
      ESOP shall have received from Advanced Valuation Analytics, Ltd. a valuation
      opinion dated as of the Closing Date, to the effect that the consideration
      to be
      received by the ESOP for redemption of their shares by Company immediately
      prior
      to Closing shall be at least equal to the fair market value of the shares,
      and
      that the terms of the redemption are fair to the ESOP from a financial point
      of
      view, all as required under the Company's ESOP and applicable Department of
      Labor regulations. 

     

    (g) ESOP
      Trustee.
      The
      trustee of the ESOP shall have determined that the redemption of the shares
      by
      Company of the Company capital stock held by the ESOP does not violate
      ERISA.

     

    (h) Filing
      of Statement of Designations.
      The
      Statement of Designations shall have been filed with the Secretary of State
      of
      the State of Delaware and shall continue to be in full force and effect as
      of
      the Closing Date.

     

    (i) Joinder.
      Thomas
      Aylesworth, Darrell Berger, Markus Litscher, Lino Ricciardi and each holder
      of
      Company options who exercised such options between the date hereof and Closing
      and shall have all joined this Agreement as an Owner hereunder.

     

    ARTICLE
      8

    CLOSING

     

    8.1. The
      Closing.
      The
      consummation of the transactions contemplated by this Agreement (the
“Closing”)
      shall
      take place in person at the offices of Shaiman, Drucker, Beckman, Sobel &
Stutman LLP, 1845 Walnut Street, 15th
      Floor,
      Philadelphia, PA 19103, or by facsimile or other electronic means upon the
      satisfaction of the conditions set forth in Section 7.1 and 7.2 which is
      expected to occur on or before September 15, 2006 (the “Closing Date”)
      or
      such other location or later date as the parties may agree. Subject to Section
      13.2, if the Closing does not occur by the 15th
      day
      subsequent from the date hereof, Purchaser shall pay the Owners the
      nonrefundable Cash Deposit. 

    

    8.2. Deliveries
      of Purchaser.
      At the
      Closing, Purchaser shall deliver to
      the
Owners:

     

    
      
        
        

      

      
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    (a) the
      bring
      down certificate referenced in Section 7.2(a);

     

    (b) the
      certificate referenced in Section 7.2(b);
      

     

    (c) the
      Closing Payment,
      including the Note and certificates representing the Purchaser
      Shares;

     

    (d) the
      Employment Agreement;

     

    (e) the
      Registration Rights Agreement;

     

    (f) the
      Pledge Agreement;

     

    (g) the
      Escrow Agreement and the Hold Back Escrow Agreement; and 

     

    (h) such
      other instruments or agreements as the Owner Representative may reasonably
      require.

     

    8.3. Deliveries
      of the Owners.
      On the
      Closing Date, the Owners shall deliver, or caused to be delivered, to the
      Purchaser:

     

    (a) Stock
      certificates representing the Transferred Shares, duly endorsed in blank and
      accompanied by duly executed stock powers (provided that 3,050 of the
      Transferred Shares to be delivered to Michael Stutman, Esq., of Drucker,
      Beckman, Sobel & Stutman LLP pursuant to Section 3.4(c) and the Pledge
      Agreement);

     

    (b) the
      bring-down certificate referenced in Section 7.1(a);

     

    (c) the
      certificate referenced in Section 7.1(b);

     

    (d) the
      Registration Rights Agreement;

     

    (e) the
      Employment Agreement; 

     

    (f) the
      Escrow Agreement and the Hold Back Escrow Agreement; and 

     

    (g) such
      other instruments or agreements as the Purchaser may reasonably
      require.

     

    ARTICLE
      9

    SURVIVAL;
      WAIVER OF INDEMNITY OR CONTRIBUTION

     

    9.1. Survival
      of Representations and
      Warranties.
      The
      representations and warranties of each Party hereunder:

     

    (a) shall
      survive until eighteen months following the Closing, except for the
      representations and warranties in Sections 4.15 and 5.14 which shall survive
      until the expiration of the statute of limitations applicable to the subject
      matter addressed there under;

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

       

    

    (b) any
      representation or warranty that would otherwise terminate in accordance with
      Section 9.1(a)
      will
      continue to survive if an Indemnity Notice, a Claim Notice or other written
      notice of facts that can reasonably be expected to give rise to an
      indemnification claim under Article
      10
      shall
      have been given in good faith on or prior to the date on which such
      representation or warranty would have otherwise terminated, until the related
      claim for indemnification has been satisfied or otherwise resolved as provided
      in Article
      10;
      and

     

    (c) any
      representation or warranty contained in this Agreement made by any party or
      any
      information furnished by any party that was made by such party fraudulently,
      shall indefinitely survive the Closing.

     

    9.2. No
      Indemnity or Contribution; Waiver. 

     

    (a) The
      Owners shall not be entitled to make any claim for indemnity or contribution
      or
      any other similar claim against Purchaser or any of Purchaser’s Affiliates
      (including, after the Closing, the Company), with respect to any Indemnifiable
      Losses for which the Owners or their respective Affiliates are liable under
      Article
      10.
      To the
      extent that the Owners may now or in the future have the right to assert any
      such claim against Purchaser or any of Purchaser’s Affiliates (including, after
      the Closing, the Company), the Owners hereby waive any such right and hereby
      release and forever discharge Purchaser and Purchaser’s Affiliates (including,
      after the Closing, the Company) from any such claim.

     

    (b) The
      Purchaser shall not be entitled to make any claim for indemnity or contribution
      or any other similar claim against the Owners or any of Owners’ Affiliates with
      respect to any Indemnifiable Losses for which the Purchaser and/or their
      respective Affiliates are liable under Article
      10.
      To the
      extent that the Purchaser may now or in the future have the right to assert
      any
      such claim against Owners or any of Owners’ respective Affiliates, the Purchaser
      hereby waives any such right and hereby release and forever discharge Owners
      and
      Owners’ Affiliates from any such claim.

     

    ARTICLE
      10

    INDEMNIFICATION

     

    10.1. The
      Owners’ Indemnification.
      From and
      after the Closing Date, the Owners severally shall indemnify and hold harmless
      Purchaser and any of Purchaser’s Affiliates (including, after the Closing, the
      Company), and each of their respective directors, officers, employees, agents,
      successors and assigns and legal representatives, from and against all
      Indemnifiable Losses that may be imposed upon, incurred by or asserted against
      any of them resulting from, related to, or arising out of:

     

    (a) any
      misrepresentation or breach of any representation or warranty by the Company
      or
      the Owners under this Agreement or any document, instrument, certificate or
      other item furnished or to be furnished to Purchaser pursuant hereto or thereto
      or in connection with the transactions contemplated by this
      Agreement;
      and

     

    (b) any
      breach or non-fulfillment of any covenant or agreement to be performed by the
      Company or the Owners under this Agreement or any document, instrument,
      certificate or other item furnished or to be furnished to Purchaser pursuant
      hereto or thereto in connection with the transactions contemplated by this
      Agreement.

     

    
      
        
        

      

      
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    10.2. The
      Purchaser’s Indemnification.
      From
      and after the Closing Date, the Purchaser shall indemnify and hold harmless
      each
      Owner and any Owner Affiliate, and each of their respective directors, officers,
      employees, agents, successors and assigns and legal representatives, from and
      against all Indemnifiable Losses that may be imposed upon, incurred by or
      asserted against any of them resulting from, related to, or arising out
      of:

     

    (c) any
      misrepresentation or breach of any representation or warranty by the Purchaser
      under this Agreement or any document, instrument, certificate or other item
      furnished or to be furnished to the Company and/or Owners pursuant hereto or
      thereto or in connection with the transactions contemplated by this Agreement;
      and

     

    (d) any
      breach or non-fulfillment of any covenant or agreement to be performed by the
      Purchaser under this Agreement or any document, instrument, certificate or
      other
      item furnished or to be furnished to the Company and/or Owners pursuant hereto
      or thereto in connection with the transactions contemplated by this
      Agreement.

     

    10.3. Payment;
      Procedure for Indemnification.

     

    (a) In
      the
      event that a Person shall suffer an Indemnifiable Loss and seek indemnification
      under this Article (the “Indemnified Party”)
      he,
      she or it shall give written notice to the Owners
      (the
“Noticed Party,”
and
      the party(ies) from whom indemnification under this Article is sought, the
      “Indemnifying Party”)
      of the
      amount of the Indemnifiable Loss, together with reasonably sufficient
      information to enable the Noticed Party to determine the accuracy and nature
      of
      the claimed Indemnifiable Loss (the “Indemnity Notice”).
      The
      failure of any Indemnified Party to give the Noticed Party the Indemnity Notice
      promptly after actual notice of the Indemnifiable Loss shall not release the
      Indemnifying Party of liability under this Article; provided, however that
      the
      Indemnifying Party shall not be liable for Indemnifiable Losses incurred by
      the
      Indemnified Party that would not have been incurred but for the delay in the
      delivery of, or the failure to deliver, the Indemnity Notice. Within 30 days
      after the receipt by the Noticed Party of the Indemnity Notice, the Noticed
      Party shall do one of the following and decide whether or not to raise any
      objection: (i) provide notice to the Indemnifying Party directing the
      Indemnifying Party to pay to the Indemnified Party an amount equal to the
      Indemnifiable Loss or (ii) object to such claim, in which case the Noticed
      Party
      shall give written notice to the Indemnified Party of such objection together
      with the reasons therefor, it being understood that the failure of the Noticed
      Party to so object shall preclude the Noticed Party from asserting any claim,
      defense or counterclaim relating to the Indemnifying Party’s failure to pay any
      Indemnifiable Loss that was the subject of such Notice. The Noticed Party’s
      objection shall not relieve the Indemnifying Party from its obligations under
      this Article.

     

    (b) In
      the
      event the facts giving rise to the claim for indemnification under this Article
      shall involve any action or threatened claim or demand by any third party
      against the Indemnified Party, the Indemnified Party, within the earlier of,
      as
      applicable, 10 days after receiving a written notice of the filing of a lawsuit
      or 30 days after receiving notice of the existence of a claim or demand giving
      rise to the claim for indemnification, shall send written notice of such claim
      to the Noticed Party (the “Claim Notice”).
      The
      failure of the Indemnified Party to give the Noticed Party the Claim Notice
      shall not release the Indemnifying Party of liability under this Article;
      provided, however, that the Indemnifying Party shall not be liable for
      Indemnifiable Losses incurred by the Indemnified Party that would not have
      been
      incurred but for the delay in the delivery of, or the failure to deliver, the
      Claim Notice. Except for claims resulting from, relating to, or arising out
      of
      any dispute with the Company’s customers or suppliers, the Indemnifying Party
      shall be entitled to defend such claim in the name of the Indemnified Party
      at
      the Indemnifying Party’s own expense and through counsel of the Indemnifying
      Party’s own choosing; provided, that if the applicable claim or demand is
      against, or if the defendants in any such Legal Proceeding shall include, both
      the Indemnified Party and the Indemnifying Party and the Indemnified Party
      reasonably concludes that there are defenses available to it that are different
      or additional to those available to the Indemnifying Party or if the interests
      of the Indemnified Party may be reasonably deemed to conflict with those of
      the
      Indemnifying Party, then the Indemnified Party shall have the right to select
      separate counsel and to assume and control the defense of such claim, demand
      or
      Legal Proceeding, with the reasonable fees, expenses and disbursements of such
      counsel to be reimbursed by the Indemnifying Party as incurred. The Indemnifying
      Party shall give the Indemnified Party notice in writing within 10 days after
      receiving the Claim Notice from the Indemnified Party in the event of
      litigation, or otherwise within 30 days, of its intent to defend such claim.
      In
      the case of any claim resulting from, relating to or arising out of any dispute
      with any of the Company’s customers or suppliers, Purchaser shall have the sole
      right to control the defense thereof. Whenever the Indemnifying Party is
      entitled to defend any claim under this Section 10.2(b),
      the
      Indemnified Party may elect, by notice in writing to the Noticed Party, to
      continue to participate through its own counsel, at the Indemnified Party’s
      expense, but the Indemnifying Party shall have the right to control the defense
      of the claim or the litigation.
      The
      Indemnified Party shall cooperate with the Indemnifying Party in the defense
      of
      any claim, demand or Legal Proceeding that the Indemnifying Party has and for
      which the Indemnifying Party has elected to defend pursuant to this
      Section 10.2(b).

     

    
      
        
        

      

      
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    (c) Notwithstanding
      any other provision contained in this Agreement, the party controlling the
      defense of the claim or the litigation shall not settle any such claim or
      litigation without the prior written consent of the Noticed Party for the other
      party, which consent shall not be unreasonably withheld; provided, that if
      the
      Indemnified Party is controlling the defense of the claim or the litigation
      and
      shall have, in good faith, negotiated a settlement thereof, which proposed
      settlement contains terms that are reasonable under the circumstances, then
      the
      Noticed Party for the Indemnifying Party shall not withhold or delay the giving
      of such consent. In the event that the Indemnifying Party is controlling the
      defense of the claim or the litigation and shall have negotiated a settlement
      thereof, which proposed settlement is substantively final and unconditional
      as
      to the parties thereto (other than the consent of the Noticed Party for the
      Indemnified Party required under this Section 10.2(c))
      and
      contains an unconditional release of the Indemnified Party and does not include
      the taking of any actions by, or the imposition of any restrictions on the
      part
      of, the Indemnified Party and the Noticed Party for the Indemnified Party shall
      unreasonably refuse to consent to such settlement, the liability of the
      Indemnifying Party under this Article, upon the ultimate disposition of such
      litigation or claim, shall be limited to the amount of the proposed settlement;
      provided, however, that in the event the proposed settlement shall require
      that
      the Indemnified Party make an admission of liability, a confession of judgment,
      or shall contain any other non-financial obligation which, in the reasonable
      judgment of the Indemnified Party, renders such settlement unacceptable, then
      the Indemnified Party’s failure to consent shall not give rise to the foregoing
      limitation of the Indemnifying Party’s liability as provided for in this
      Section 10.2(c),
      and the
      Indemnifying Party shall continue to be liable to the full extent of such
      litigation or claim.

     

    
      
        
        

      

      
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    (d) The
      party
      controlling the defense of the claim or the litigation shall provide to the
      non-controlling party a report as to the status of each claim for
      indemnification pursuant to this Article no less frequently than once every
      three months so long as such claim is outstanding.

     

    (e) The
      non-controlling party in the defense of the claim or the litigation shall have
      the right to consult with the controlling party and the controlling party shall
      facilitate such consultation with respect to the conduct and results of the
      proceeding and the strategy of the controlling party for addressing the matters
      that are the basis of such claim. Upon reasonable request by the non-controlling
      party, the controlling party shall provide the notice, copies, access and right
      of consultation provided for herein with respect to any claim for
      indemnification pursuant to this Agreement.

     

    (f) Notwithstanding
      any indemnification or defense arrangement between the parties to this Agreement
      to the contrary, the parties agree to cooperate with each other in pursuing
      any
      claims against any Person who may be liable for any Losses or Liabilities which
      are the subject of an Indemnity Notice, and in pursuing any available claims
      against insurers who may have provided insurance coverage for any such Losses
      or
      Liabilities.

     

    10.4. Limitations.
      The
      Owners' indemnification obligations under Section 10.1(a)
      shall
      not arise unless the aggregate amount of Indemnifiable Losses for which the
      Owners are so required to indemnify exceeds $25,000, but in such event, the
      Owners shall be required to indemnify the Indemnified Party for all
      Indemnifiable Losses, including the initial $25,000 of Indemnifiable Losses
      up
      to a cap of $700,000, the first half of which shall be payable in Purchaser
      Shares valued at the greater of: (i) the closing market price and (ii) the
      volume-weighted average price per share for the fifteen (15) days prior to
      the
      indemnification event and the second half of which shall be payable in cash.
      Notwithstanding any other provision herein, no Owner shall have any
      indemnification payment obligation for any Indemnifiable Losses under this
      Article
      10
      in
      excess of the aggregate Purchase Price received by such Owner from Purchaser
      for
      such Owner's Transferred Shares sold hereunder; and provided, further the Owners
      aggregate indemnification obligation under Section 10.1 shall be limited to
      the Escrow Deposit. 

    

    10.5. Payment. Upon
      the
      determination of the liability under this Article
      10,
      the
      Indemnifying Party shall pay to the Indemnified Party within 10 Business Days
      after such determination, the amount of any claim for indemnification made
      hereunder.  

     

    10.6. Non-Impairment
      of Indemnity. 

     

    (a) The
      results of Purchaser’s due diligence investigation and examination of the
      Company and the Owners
      is for
      Purchaser’s sole benefit, and shall not (i) impair or reduce any representation
      or warranty made by the Company and/or the Owners
      in this
      Agreement, (ii) relieve the Company or the Owners
      from its
      or their obligations with respect to such representations and warranties
      (including, without limitation, the indemnification obligations under this
      Article), or (iii) mitigate any of the Company’s or the Owners’
      obligations to disclose all material facts to Purchaser with respect to the
      Company and the Business.

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

       

    

    (b) The
      results of Company's and/or Owners due diligence investigation and examination
      of the Purchaser is for Company's and the Owners' sole benefit, and shall not
      (i) impair or reduce any representation or warranty made by the Purchaser in
      this Agreement, (ii) relieve the Purchaser from its obligations with respect
      to
      such representations and warranties (including, without limitation, the
      indemnification obligations under this Article), or (iii) mitigate any of the
      Purchaser's obligations to disclose all material facts to the Company and Owners
      with respect to the Purchaser and its business.

     

    10.7. Subrogation.
      Upon
      making an indemnity payment pursuant to this Agreement, the Indemnifying Party
      will, to the extent of such payment, be subrogated to all rights of the
      Indemnified Party against any third party in respect of the damages to which
      the
      payment related. Without limiting the generality of any other provision hereof,
      each such Indemnified Party and Indemnifying Party will duly execute upon
      request all instruments reasonably necessary to evidence and perfect the above
      described subrogation rights.

     

    10.8. Exclusive
      Remedies.
      The
      remedies provided for in this Agreement shall be the sole and exclusive remedies
      of the parties and their respective officers, directors, employees, affiliates,
      agents, representatives, successors and assigns for any breach of or inaccuracy
      in any representation, warranty or covenant contained in this Agreement or
      any
      certificate delivered at Closing; provided,
      however,
      that
      nothing herein is intended to waive any claims for fraud or waive any equitable
      remedies to which a party may be entitled.

     

    10.9. No
      Double Recovery; Use of Insurance.
      Notwithstanding
      anything herein to the contrary, no party shall be entitled to indemnification
      or reimbursement under any provision of this Agreement for any amount to the
      extent such party or its Affiliate has been indemnified or reimbursed for such
      amount under any other provision of this Agreement, the Exhibits or Disclosure
      Schedules attached hereto, or any document executed in connection with this
      Agreement or otherwise. Furthermore, in the event any Indemnifiable Losses
      related to a claim by Purchaser are covered by insurance, Purchaser agrees
      to
      use commercially reasonable efforts to seek recovery
      under such insurance and Purchaser shall not be entitled to recover from the
      Owners(and shall refund amounts received up to the amount of indemnification
      actually received) with respect to such damages to the extent Purchaser recovers
      the insurance payment specified in the policy.

     

    10.10. Treatment
      of Indemnity Payments Between the
      Parties.
      Unless
      otherwise required by applicable Requirements of Law, all indemnification
      payments shall constitute adjustments to the Purchase Price for all Tax
      purposes, and no party shall take any position inconsistent with such
      characterization.

     

    10.11. Mitigation.
      Each
      party agrees to use reasonable efforts to mitigate any loss, liability or damage
      which forms the basis of a claim hereunder.

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      11

    POST-CLOSING
      COVENANTS

     

    11.1. Further
      Cooperation. 

     

    (a) From
      and
      after the Closing Date, at Purchaser’s request from time to time, the
Owners
      shall
      execute and deliver to Purchaser such further endorsements, assignments and
      instruments of transfer and conveyance and take such other actions as Purchaser
      reasonably requests to transfer, vest or perfect Purchaser’s rights in and to
      the Transferred Shares, free and clear of all Encumbrances and to consummate
      the
      transactions contemplated by this Agreement.

     

    (b) From
      and
      after the Closing Date, at an Owner's request from time to time, the
Purchaser
      shall
      execute and deliver to such Owner such further endorsements, assignments and
      instruments of transfer and conveyance and take such other actions as such
      Owner
      reasonably requests to transfer, vest or perfect the Owner's rights in and
      to
      the Purchaser Shares, free and clear of all Encumbrances and to consummate
      the
      transactions contemplated by this Agreement.

     

    11.2. Director
      and Officer Indemnification and Insurance.

     

    (a) Indemnification.
      Purchaser agrees that it shall cause, for a period of six (6) years after the
      Closing, all rights to indemnification existing immediately prior to the Closing
      in favor of the current directors (both in their capacity as directors and
      officers of Company) of Company at or prior to the Closing and the officers
      of
      Company listed on Schedule 11.2(a)
      (“Indemnified
      Employees”)
      as
      provided for in Company’s Bylaws as of the date hereof to continue (without
      amendment or modification in any way unless required by law or regulation)
      in
      full force. Subject to the foregoing, Purchaser may, from and after the Closing,
      cause Company to merge, dissolve or reorganize.

     

    (b) For
      a
      period of four (4) years after the Closing, Purchaser shall maintain or cause
      Company to maintain fiduciary liability insurance with coverage in respect
      of
      periods prior to the Closing in amount and scope substantially identical to
      that
      provided to Company under its policy no. 42 3467765 with
      Hartford.

     

    (c) This
      Section 11.2 shall be binding on all successors and assigns of Company and
      Purchaser. In the event that Purchaser or Company or any of their respective
      successors or assigns consummates a Change of Control, then and in each such
      case, proper provision shall be made so that such successors and assigns shall
      assume all obligations set forth in this Section 11.2. The provisions of
      this Section 11.2 are intended to be for the benefit of, and shall be
      enforceable by, each Indemnified Employee, his or her heirs, and his or her
      representatives or assigns.

     

    11.3. Termination
      of ESOP.
      Company, Owner Representative and ESOP shall take all appropriate action to
      terminate ESOP simultaneously with the Closing, it being under that the ESOP
      Trust must continue as required by the ESOP, ERISA and applicable Department
      of
      Labor regulations.

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

       

    

    ARTICLE
      12

    CERTAIN
      TAX MATTERS

     

    12.1. Transfer
      Taxes.
      The
      Purchaser shall be responsible for the payment of all Transfer Taxes, if any,
      which may be payable with respect to the sale and transfer of the Transferred
      Shares and the Purchaser Shares. The Owners shall, at their own expense, file
      all necessary Tax Returns and other documentation with respect to all such
      Transfer Taxes and, if required, by any applicable Requirement of Law, Purchaser
      will, and will cause the Company to, join in an execution of any such Tax
      Returns and other documentation.

     

    12.2. Other
      Tax Returns.

     

    (a) Tax
      Periods Ending on or Before March 31, 2006.
      Owner
      Representative shall prepare or cause to be prepared and file or cause to be
      filed in a timely manner all federal and state income Tax Returns for the
      Company for all Tax periods ending on or prior to March 31, 2006 which are
      filed
      after the Closing Date and the Owners shall pay all Taxes payable by the Company
      reflected on such Tax Returns or due for Tax periods covered by such Tax
      Returns. The Purchaser shall and, following the Closing Date, shall cause the
      Company to, cooperate with any commercially reasonable request of the Owners
      to
      permit the Owners to comply with their obligations under this
      Section 12.2(a).
      The
      Owners shall be entitled to receive, pro rata based on the Payment Factor,
      all
      Company Tax refunds for all Tax periods ending on or prior to March 31,
      2006.

     

    (b) Tax
      Periods Beginning After March 31, 2006.
      Purchaser shall prepare or cause to be prepared and file or cause to be filed
      any Tax Returns of the Company for Tax periods which begin after March 31,
      2006,
      and Purchaser shall pay all Taxes payable by the Company reflected on such
      Tax
      Returns or due for Tax periods covered by such Tax Returns, up to a maximum
      of
      Two Hundred Thousand Dollars ($200,000.00). Notwithstanding
      the foregoing, Owners shall pay all Taxes payable by the Company reflected
      on
      such Tax Returns or due for Tax periods covered by such Tax Returns, in excess
      of Two Hundred Thousand Dollars ($200,000.00) (except for any portion of such
      Tax liability that might arise as a result of Company converting from cash
      to
      accrual reporting of its Taxes). If such Tax Returns show a Tax liability in
      excess of Two Hundred Thousand Dollars ($200,000.00) Purchaser shall permit
      Owner Representative to review and comment on each such Tax Return described
      in
      the preceding sentence prior to filing and shall make such revisions to such
      Tax
      Returns as are reasonably requested by Owner Representative. 

     

    (c) Cooperation
      on Tax Matters.

     

    (i) Purchaser,
      the Company, and the Owners shall cooperate fully, as and to the extent
      reasonably requested by the other party, in connection with the filing of Tax
      Returns pursuant to this Section 12.2 and any audit, litigation or other
      proceeding with respect to Taxes. Such cooperation shall include the retention
      and (upon the other party’s request) the provision of records and information
      which are reasonably relevant to any such audit, litigation or other proceeding
      and making employees available on a mutually convenient basis to provide
      additional information and explanation of any material provided hereunder.
      The
      Company and the Owners agree (A) to retain all Books and Records with respect
      to
      Tax matters pertinent to the Company relating to any Tax period beginning before
      the Closing Date until the expiration of the statute of limitations (and, to
      the
      extent notified by Purchaser or the Owners, any extensions thereof) of the
      respective Tax periods, and to abide by all record retention agreements entered
      into with any taxing authority, and (B) to give the other party reasonable
      written notice prior to transferring, destroying or discarding any such Books
      and Records and, if the other party so requests, the Company or the Owners,
      as
      the case may be, shall allow the other party to take possession of such Books
      and Records.

     

    
      
        
        

      

      
        40

        
          

        

      

      
        
        

      

       

    

    (ii) Purchaser
      and the Owners further agree, upon request, to use their commercially reasonable
      efforts to obtain any certificate or other document from any Governmental or
      Regulatory Authority or any other person as may be necessary to mitigate, reduce
      or eliminate any Tax that could be imposed (including, but not limited to,
      with
      respect to the transactions contemplated hereby).

     

    (iii) Following
      the Closing, the Company shall not take any action which would be reasonably
      likely to have an adverse Tax impact upon the Company or the Owners for any
      period ending prior to the date of Closing unless the Company, after
      consultation with its Tax advisors, determines that a Tax position of the
      Company for any period ending prior to the date of Closing was
      illegal.

     

    (iv) Any
      adverse Tax consequences upon the Company or the Owners for any period ending
      prior to the Closing Date as a result of Company converting from cash to accrual
      reporting of its Taxes shall be the responsibility of Purchaser.

     

    ARTICLE
      13

    TERMINATION

     

    13.1. Termination
      Events.
      This
      Agreement may be terminated at any time prior to the Closing Date as
      follows:

     

    (a) By
      the
      mutual written consent of the Owner Representative and Purchaser;

     

    (b) iv)
      By
      Purchaser if there has been a material breach of any representation or warranty
      set forth in this Agreement on the part of the Company and/or the Owners which
      is incapable of being, or is not, cured within 10 Business Days after written
      notice from Purchaser to the Company and the Owner Representative of such breach
      (or in any event prior to the date of Closing), and (ii) by the Owner
      Representative if there has been a material breach of any representation or
      warranty set forth in this Agreement on the part of Purchaser which is incapable
      of being, or is not, cured within 10 Business Days after notice from the Owner
      Representative to Purchaser of such breach (or in any event prior to the date
      of
      Closing).

     

    (c) (i)
      By
      Purchaser if there has been a material breach of any covenant or agreement
      set
      forth in this Agreement on the part of the Company and/or the Owners, which
      is
      incapable of being, or is not, cured (other than by mere disclosure of the
      breach) within 10 Business Days after written notice from Purchaser to the
      Company and the Owner Representative of such breach (or in any event prior
      to
      the date of Closing), and (ii) by the Owner Representative if there has been
      a
      material breach of any covenant or agreement set forth in this Agreement on
      the
      part of Purchaser, which is incapable of being, or is not, cured (other than
      by
      mere disclosure of the breach) within 10 Business Days after written notice
      from
      the Owner Representative or Company to Purchaser of such breach (or in any
      event
      prior to the date of Closing);

     

    
      
        
        

      

      
        41

        
          

        

      

      
        
        

      

    

     

    (d) (i)
      By
      Purchaser if any of the conditions specified in Section 7.1
      hereof
      shall not have been fulfilled by the time required and shall not have been
      waived by Purchaser; and (ii) by the Owner Representative if any of the
      conditions specified in Section 7.2
      hereof
      shall not have been fulfilled by the time required and shall not have been
      waived by the Owners;

     

    (e) By
      Purchaser if the transactions contemplated by this Agreement have not been
      consummated on or before ninety (90) days following the date hereof; provided,
      that, Purchaser may terminate this Agreement pursuant to this
      subsection (e)
      only if
      Closing shall not have occurred by such date for a reason other than Purchaser’s
      failure to satisfy the conditions to Closing of Owners set forth in
      Section 7.2
      hereof;
      

     

    (f) By
      the
      Owner Representative if the transactions contemplated by this Agreement have
      not
      been consummated on or before forty-five (45) days following the date hereof;
      provided, that, Owners may terminate this Agreement pursuant to this
      subsection (f)
      only if
      Closing shall not have occurred by such date for a reason other than Owners’
failure to satisfy the conditions to Closing of Purchaser set forth in
      Section 7.1
      hereof; 

     

    (g) By
      Purchaser or the Owners if any permanent injunction or final non-appealable
      order or decree of any court of competent jurisdiction and authority is in
      effect which would prevent the consummation of the transactions contemplated
      by
      this Agreement.

     

    13.2. Liabilities
      in Event of Termination.
      In the
      event of any termination of this Agreement pursuant to Section 13.1,
      this
      Agreement shall terminate and there shall be no liability on the part of any
      party hereto except:

     

    (h) 
      if this
      Agreement is terminated pursuant to Section 13.1(a),
      13.1(b)(i),
      13.1(c)(i)
      or
13.1(d)(i),
      then
      the Cash Deposit shall be returned within three (3) Business Days thereafter
      to
      Purchaser;

     

    (i) if
      this
      Agreement is terminated for any reason other than pursuant to
      Section 13.1(a),
      13.1(b)(i),
      13.1(c)(i)
      or
13.1(d)(i),
      then
      the Company shall be entitled to keep the Cash Deposit; and 

     

    (j) 
      for
      liabilities arising from a willful breach of this Agreement prior to such
      termination; provided, however, that the terms and conditions of Article
      1,
      Sections 6.2,
      6.4,
      this
Article
      13
      and
Article
      14
      shall
      survive such termination.

     

    
      
        
        

      

      
        42

        
          

        

      

      
        
        

      

       

    

    ARTICLE
      14

    MISCELLANEOUS

     

    14.1. Notices.
      All
      notices required to be given to any of the parties to this Agreement shall
      be in
      writing and shall be deemed to have been sufficiently given, subject to the
      further provisions of this Section 14.1,
      for all
      purposes when presented personally to such party or sent by certified or
      registered mail, return receipt requested, with proper postage prepaid, or
      any
      national overnight delivery service, with proper charges prepaid, to such party
      at its address set forth below:

     

    
      	
              If
                to the 

              Owner
                Representative:

            	
               

               

              Mr.
                Michael Ricciardi

              5704
                Old Clifton Road

              Clifton,
                VA 20124

            
	 	 
	
              With
                a copy to:

            	
              Holland
                & Knight LLP

              1600
                Tysons Boulevard, Suite 700

              McLean,
                Virginia 22102

              Attention:
                William J. Mutryn

              (Fax)
                703/720-8610

            
	 	 
	
              If
                to the Company (pre-Closing):

            	
              Ricciardi
                Technologies, Inc.

              8306
                Rugby Road

              Manassas,
                VA 20111

              Facsimile:
                703/365-9818

            
	 	 
	
              With
                a copy to:

            	
              Holland
                & Knight LLP

              1600
                Tysons Boulevard, Suite 700

              McLean,
                Virginia 22102

              Attention:
                William J. Mutryn

              (Fax)
                703/720-8610

            
	 	 
	
              If
                to Purchaser:

            	
              Science
                Dynamics Corporation.

              7150
                N. Park Drive, Suite 500

              Pennsauken,
                New Jersey 08109

              Attention:
                Mr. Paul Burgess

              Facsimile:
                __________________

            
	 	 
	
              With
                a copy to:

            	
              Shaiman,
                Drucker, Beckman, Sobel & Stutman LLP

              1845
                Walnut Street, 15th
                Floor

              Philadelphia,
                PA 19103

              Attention:
                Michael J. Stutman, Esquire

              Facsimile:
                215.972.0048

            

    

     

    Such
      notice shall be deemed to be received when delivered if delivered personally,
      the next business day after the date sent if sent by a national overnight
      delivery service, or three (3) business days after the date mailed if mailed
      by
      certified or registered mail. Any notice of any change in such address shall
      also be given in the manner set forth above. Whenever the giving of notice
      is
      required, the giving of such notice may be waived in writing by the party
      entitled to receive such notice.

     

    
      
        
        

      

      
        43

        
          

        

      

      
        
        

      

    

     

    14.2. No
      Third Party Beneficiaries.
      Except
      as is otherwise expressly provided in this Agreement, this Agreement is not
      intended to, and does not, create any rights in or confer any benefits upon
      anyone other than the parties hereto.

     

    14.3. Schedules
      and Exhibits.
      All
      schedules and exhibits attached to this Agreement are incorporated by reference
      into this Agreement for all purposes.

     

    14.4. Expenses.
      Purchaser, on the one hand, and the Owners, on the other hand, shall pay their
      own expenses incident to the preparation, negotiation and execution of this
      Agreement including, without limitation, all fees and costs and expenses of
      their respective legal counsel and advisors.

     

    14.5. Entire
      Agreement; Amendment.
      This
      Agreement and the Transaction Documents and any other documents, instruments
      or
      other writings delivered or to be delivered pursuant to this Agreement
      constitute the entire agreement among the parties with respect to the subject
      matter hereof and thereof and supersede all prior agreements, understandings,
      and negotiations, whether written or oral, with respect to the subject matter
      hereof and thereof. None of the terms and provisions contained in this Agreement
      can be changed without a writing signed by all parties hereto.

     

    14.6. Public
      Statements.
      The
      Owners and Purchaser agree to consult with each other before issuing any press
      release or otherwise making any public statement with respect to the
      transactions contemplated hereby, and shall not issue any such press release
      or
      make any such public statement prior to such consultation, except as may be
      required by a Requirement of Law.

     

    14.7. No
      Waiver of Rights.
      No
      waiver of any rights of the Owners, on the one hand, or Purchaser, on the other
      hand, under this Agreement shall be effective unless it is in writing and
      executed by a duly authorized representative of the party against whom
      enforcement of any such waiver is sought. No failure or delay on the part of
      any
      party in the exercise of any power or right under this Agreement shall operate
      as a waiver thereof, nor shall any single or partial exercise of any such power
      or right. The waiver by any party of a breach of any provision of this Agreement
      shall not operate or be construed as a waiver of any other or subsequent breach
      under this Agreement.

     

    14.8. Section and
      Paragraph Titles.
      The
      section and paragraph titles used in this Agreement are for convenience
      only and are not intended to define or limit the contents or substance of any
      such section or paragraph.

     

    14.9. Binding
      Effect.
      This
      Agreement shall be binding upon and inure to the benefit of each of the parties
      to this Agreement and their respective heirs, personal representatives, and
      successors (including any entity into which such party may be converted) and
      permitted assigns. The Owners, on the one hand, and Purchaser, on the other
      hand, shall not have the right to assign this Agreement without the prior
      written consent of the other, provided, that (a) Purchaser may assign any
      or all of its rights and interests under this Agreement to one or more of
      Purchaser’s Affiliates; and (b) any or all of the rights and interests of
      Purchaser under this Agreement (i) may be assigned to any Purchaser of
      substantially all of the assets of Purchaser or any of Purchaser’s Affiliates,
      (ii) may be assigned as a matter of law to the surviving entity in any merger,
      consolidation, share exchange or reorganization involving Purchaser, and (iii)
      may be assigned as collateral security to any lender or lenders (including
      any
      agent for any such lender or lenders) providing financing in connection with
      the
      transactions contemplated by this Agreement, or to any assignee or assignees
      of
      such lender, lenders or agent (it being understood that in any or all of the
      cases described in clauses (a) and (b) above Purchaser nonetheless shall remain
      responsible for the performance of all of its obligations under this
      Agreement).

     

    
      
        
        

      

      
        44

        
          

        

      

      
        
        

      

       

    

    14.10. Counterparts.
      This
      Agreement may be executed in any number of counterparts, and each such
      counterpart shall be deemed to be an original instrument, but all such
      counterparts together shall constitute one and the same instrument.

     

    14.11. Severability.
      Any
      provision of this Agreement that is prohibited or unenforceable in any
      jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
      such prohibition or unenforceability without invalidating the remaining
      provisions of this Agreement or such provision, and any such prohibition or
      unenforceability in any jurisdiction shall not invalidate or render
      unenforceable such provision in any other jurisdiction.

     

    14.12. Owner
      Representative.

     

    (a) By
      the
      execution and delivery of this Agreement, including counterparts hereof, each
      Owner hereby irrevocably constitutes and appoints Michael Ricciardi as the
      true
      and lawful agent and attorney-in-fact (the “Owner
      Representative”)
      of
      such Owner with full powers of substitution to act in the name, place and stead
      of such Owner with respect to the performance on behalf of such Owner under
      the
      terms and provisions of this Agreement, as the same may be from time to time
      amended, and to do or refrain from doing all such further acts and things,
      and
      to execute all such
      documents on such Owner’s behalf, as the Owner Representative shall deem
      necessary or appropriate in connection with any of the transactions contemplated
      under this Agreement, including:

     

    (i) to
      receive all payments made by the Purchaser to the Owners under this
      Agreement;

     

    (ii) to
      agree
      upon or compromise any matter related to the calculation of any adjustments
      to
      the Purchase Price pursuant to Article
      3
      or
      otherwise or other payments to be made;

     

    (iii) to
      act
      for the Owners with respect to all indemnification matters referred to in this
      Agreement, including the right to compromise on behalf of the Owners any
      indemnification claim made by or against the Owners;

     

    (iv) to
      terminate, amend, or waive any provision of this Agreement; provided that any
      such action, if material to the rights and obligations of the Owners in the
      reasonable judgment of the Owner Representative, shall be taken in the same
      manner with respect to all Owners, unless otherwise agreed by each Owner who
      is
      subject to any disparate treatment of a potentially adverse nature;

     

    
      
        
        

      

      
        45

        
          

        

      

      
        
        

      

       

    

    (v) to
      employ
      and obtain the advice of legal counsel, accountants and other professional
      advisors as the Owner Representative, in his sole discretion, deems necessary
      or
      advisable in the performance of his duties as the Owner Representative and
      to
      rely on their advice and counsel;

     

    (vi) to
      incur
      and pay out of the Purchase Price expenses, including fees of attorneys and
      accountants incurred pursuant to the transactions contemplated hereby, and
      any
      other fees and expenses allocable or in any way relating to such transaction
      or
      any indemnification claim, whether incurred prior or subsequent to
      Closing;

     

    (vii) to
      retain
      a portion of the Purchase Price as a reserve against the payment of expenses
      incurred in his capacity as Owner Representative; and

     

    (viii) to
      do or
      refrain from doing any further act or deed on behalf of the Owners which the
      Owner Representative deems necessary or appropriate in his sole discretion
      relating to the subject matter of this Agreement as fully and completely as
      any
      of the Owners could do if personally present and acting.

     

    (b) The
      appointment of the Owner Representative shall be deemed coupled with an interest
      and shall be irrevocable, and any other person may conclusively and absolutely
      rely, without inquiry, upon any actions of the Owner Representative as the
      acts
      of the Owners in all matters referred to in this Agreement. Each of the Owners
      hereby ratifies and confirms all that the Owner Representative shall do or
      cause
      to be done by virtue of such Owner Representative’s appointment as Owner
      Representative of such Owner. The Owner Representative shall act for the Owners
      on all of the matters set forth in this Agreement in the manner the Owner
      Representative believes to be in the best interest of the Owners, but the Owner
      Representative shall not be responsible to any Owners for any loss or damage
      any
      Owners may suffer by reason of the performance by the Owner Representative
      of
      such Owner Representative’s duties under this Agreement, other than loss or
      damage arising from willful misconduct in the performance of such Owner
      Representative’s duties under this Agreement.

     

    (c) Each
      of
      the Owners hereby expressly acknowledges and agrees that the Owner
      Representative is authorized to act on behalf of such Owner notwithstanding
      any
      dispute or disagreement among the Owners, and that any person shall be entitled
      to rely on any and all action taken by the Owner Representative under this
      Agreement without liability to, or obligation to inquire of, any of the Owners.
      If the Owner Representative resigns or ceases to function in such capacity
      for
      any reason whatsoever, then the successor Owner Representative shall be the
      person which the Owners which held a majority of the Transferred Shares at
      Closing appoint; provided,
      however,
      that if
      for any reason no successor has been appointed within thirty (30) days, then
      any
      Owner shall have the right to petition a court of competent jurisdiction for
      appointment of a successor Owner Representative. The Owners do hereby jointly
      and severally agree to indemnify and hold the Owner Representative harmless
      from
      and against any and all liability, loss, cost, damage or expense (including
      without limitation attorneys’ fees) reasonably incurred or suffered as a result
      of the performance of such Owner Representative’s duties under this Agreement
      except for any such liability arising out of the willful misconduct of the
      Owner
      Representative.

     

    
      
        
        

      

      
        46

        
          

        

      

      
        
        

      

    

     

    14.13. Waiver
      of Jury Trial.
      EACH
      PARTY TO THIS AGREEMENT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE
      FULLEST EXTENT SUCH PARTY MAY LEGALLY AND EFFECTIVELY DO SO, TRIAL BY JURY
      IN
      ANY SUIT, ACTION OR PROCEEDING ARISING UNDER THIS AGREEMENT.

     

    14.14. Governing
      Law.
      This
      Agreement shall be governed and construed as to its validity, interpretation
      and
      effect by the laws of the Commonwealth of Virginia notwithstanding the choice
      of
      law rules of Virginia or any other jurisdiction. In addition, in the case of
      any
      dispute under or in connection with this Agreement, each of the parties hereby
      consents to the exclusive jurisdiction and venue of the courts of the
      Commonwealth of Virginia or the Federal District Courts for such state, provided
      that such Federal court has subject matter jurisdiction over such dispute,
      and
      each of the parties hereby waives any claim such party may have at any time
      as
      to forum non conveniens
      with
      respect to such venue. Notwithstanding anything to the contrary set forth in
      the
      preceding sentence, any of the parties hereto shall have the right to institute
      any legal action against the other party arising out of or relating to this
      Agreement in any appropriate court and in any jurisdiction where Company and/or
      the Owners are subject to personal jurisdiction and where venue is
      proper.

     

     

    [signature
      page follows]

     

    
      
        
        

      

      
        47

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      the
      Company, the Owners and Purchaser have caused this Stock Purchase Agreement
      to
      be duly executed as of the date first written above.

     

    
      	 	 	 
	 	
              Purchaser:

               

            
	 	SCIENCE
              DYNAMICS
              CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
               

              Name: 

            	
              
Paul
              Burgess
	 	Title:	
            
	 	 	
              

            

    

     

    
      	
            	 	 
	 	
              Company:

               

            
	 	RICCIARDI
              TECHNOLOGIES, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	Name: 	
              
 
	 	Title: 	
              
 
	 	 	
              
 

    

     

    
      	
            	Owners:
	 	 	
               

               

            
	 	
              
David
              Godso

    

     

    
      	
            	 	 
	 	 	
               

               

            
	 	
              
Domenico
              Ricciardi

    

     

    
      	
            	 	 
	 	 	
               

               

            
	 	
              
Marie
              Ricciardi

    

    

    
      	
            	 	 
	 	 	
               

               

            
	 	
              
Michael
              Ricciardi, as an Owner and as the Owner
              Representative

    

     

    
      	
            	 	 
	 	 	
               

               

            
	 	
              
Michele
              Ricciardi

    

     

    
      {Stock
        Purchase Agreement Signature Page}

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