Document:

SUBSCRIPTION AGREEMENT

Rokwader, Inc.
23950 Craftsman Road
Calabasas, CA  91302
Telephone (818) 224-3675

Attn:       Yale Farar, President

Re:         Prospectus, dated ___, 2005

Dear Mr. Farar:
The undersigned investor ("Investor") in this Subscription Agreement
("Agreement") hereby acknowledges receipt of the prospectus ("Prospectus"),
dated June __, 2005 of Rokwader, Inc., a Delaware corporation ("Rokwader"), and
subscribes for the following number of shares upon the terms and conditions set
forth in the Prospectus. The Investor agrees that this Agreement is subject to
availability and acceptance by Rokwader.

The Investor hereby subscribes for ________________ shares of Rokwader's common
stock ("Common Stock") at $0.75 per share, for an aggregate purchase price of
$____________. Enclosed are the Investor's check made payable to "City National
Bank/Rokwader, Inc.'s Escrow Account" and W-9 form, to be forwarded to the
escrow account by Rokwader. The Investor may also elect to submit his or her
subscription funds to the escrow account via wire transfer as provided in this
Agreement, after providing the required W-9 form to Rokwader.

The Investor hereby acknowledges that City National Bank is acting solely as
escrow holder in connection with the offering of Common Stock and makes no
recommendation with respect thereto. City National Bank has made no
investigation regarding the offering or any person or entity involved in the
offering.

              [Remainder of this page is left blank intentionally.]

<PAGE>

WIRING INSTRUCTIONS:                            ACCEPTED AND AGREED:

ABA #[______________________]                   --------------------------------
City National Bank                              Signature of Investor
A/C[ ________________________]
f/f/c Trust account # [___________]             --------------------------------
Account Name:  Rokwader, Inc.                   Print Full Name
Attn:  [______________________]
                                                --------------------------------
                                                Street Address

                                                --------------------------------
                                                City, State, Zip

                                                --------------------------------
                                                Area Code and Telephone Number

                                                --------------------------------
                                                Social Security Number

                                                ACCEPTED AND AGREED:

                                                Rokwader, Inc.

                                                By:
                                                   -----------------------------
                                                   Yale Farar, PresidentExhibit 10.1

AGREEMENT
AND PLAN OF MERGER

BY AND
AMONG

ITEC
ENVIRONMENTAL GROUP, INC.,

ITEC
ACQUISITIONS, INC.

AND

ROSE
WASTE SYSTEMS, INC.

 

MAY 26,
2005

 

 

AGREEMENT
AND PLAN OF MERGER

THIS
AGREEMENT AND PLAN OF MERGER (the "AGREEMENT") is entered into as of May 26,
2005 (the “Execution Date”), by and among Itec Environmental Group, Inc., a
Delaware corporation ("ITEC"), Itec Acquisitions, Inc., a Delaware corporation
wholly owned by Itec ("MERGER SUB") and Rose Waste Systems, Inc., a California
corporation ("ROSE WASTE").

WHEREAS,
the Boards of Directors of Itec, Merger Sub and Rose Waste each have determined
that the acquisition of Rose Waste by Itec is in the best interests of their
respective companies and stockholders, have approved the Merger and accordingly
have agreed to effect the merger provided for herein upon the terms and subject
to the conditions set forth herein;

WHEREAS,
(a) Itec has organized Merger Sub as a new Delaware corporation and a wholly
owned subsidiary of Itec; (b) Merger Sub will merge with and into Rose Waste in
a reverse triangular merger (the "MERGER"); and (c) Rose Waste will be the
surviving corporation (the "SURVIVING CORPORATION") of the Merger. Upon the
effectiveness of the Merger, all the outstanding capital stock of Rose Waste
will be converted into capital stock of Itec. Each of these events will be
subject to and carried out pursuant to the terms and conditions of this
Agreement and a Certificate of Merger (the "CERTIFICATE OF MERGER") and the
applicable provisions of the laws of the States of Delaware and California;
and

WHEREAS,
the Merger is intended to be treated as: (a) a purchase for accounting purposes
and (b) a tax-free reorganization pursuant to the provisions of Section
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended (the "CODE"), by
virtue of the provisions of Section 368(a)(1)(A) and Section 368(a)(2)(E) of the
Code.

NOW,
THEREFORE, in consideration of the foregoing and the respective representations,
warranties, covenants and agreements set forth herein, intending to be legally
bound hereby the parties to this Agreement agree as follows:

1.
 CERTAIN
DEFINITIONS OF GENERAL TERMS

1.1
 "ACQUISITION
PROPOSAL" with respect to an Entity means any proposal or offer concerning the
possible disposition of all or any substantial portion of Rose Waste's business,
assets or capital stock by merger, consolidation, sale of assets or any other
means or any other transaction that would involve a change in control of Rose
Waste.

1.2
 "BEST
EFFORTS" shall mean the commercially reasonable efforts that a prudent business
Person desiring to achieve a particular result with respect to its business
would use in order to ensure that such result is achieved as expeditiously as
possible. An obligation to use "Best Efforts" under this Agreement does not
require the Person subject to that obligation to take actions that would result
in a Material Adverse Change in the benefits to such Person under this Agreement
or the other Merger Agreements.

 

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1.3
 "CAUSE"
shall have the meaning ascribed to it in Mr. Gitschel’s Employment Agreement to
be executed in connection with this Agreement as described in Section 8.10 below
(the “Employment Agreement”).

1.4
 "CODE"
shall mean the Internal Revenue Code of 1986, as amended.

1.5
 "CONTRACT"
shall mean, with respect to any Person, any written or oral agreement, contract,
understanding, arrangement, instrument, note, guaranty, indemnity,
representation, warranty, deed, assignment, power of attorney, purchase order,
work order, insurance policy, benefit plan, commitment, covenant, obligation,
promise or undertaking of any nature to which such Person is a party or by which
its properties or assets may be bound or affected or under which it or its
business, properties or assets receive benefits. See also "ROSE WASTE
CONTRACTS".

1.6
 "ENCUMBRANCE"
shall mean any lien, pledge, hypothecation, charge, mortgage, security interest,
encumbrance, equity, equitable interest, claim, preference, right of possession,
lease, tenancy, license, encroachment, covenant, infringement, interference,
Order, proxy, option, right of first refusal, preemptive right, community
property interest, defect, impediment, exception, reservation, limitation,
impairment, imperfection of title, condition or restriction of any nature
(including any restriction on the voting of any security, any restriction on the
transfer of any security or other asset, any restriction on the receipt of any
income derived from any asset, any restriction on the use of any asset and any
restriction on the possession, exercise or transfer of any other attribute of
ownership of any asset) other than liens for Taxes not yet due and
payable.

1.7
 "ENTITY"
shall mean any corporation (including any non profit corporation), general
partnership, limited partnership, limited liability partnership, joint venture,
estate, trust, cooperative, foundation, society, political party, union, company
(including any limited liability company or joint stock company), firm or other
enterprise, association, organization or entity.

1.8
 "GAAP"
shall mean U.S. generally accepted accounting principles.

1.9
 "INDEMNIFIED
PERSON" means any individual or entity that is indemnified pursuant to Article
13 hereof.

1.10
 "KNOWLEDGE"

(a)
 An
individual shall be deemed to have "Knowledge" of a particular fact or other
matter if such individual is after due inquiry actually aware of such fact or
other matter.

 

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(b)
 Rose
Waste shall be deemed to have "Knowledge" of a particular fact or matter only if
a director or Key Employee has or had Knowledge of such fact or
matter.

1.11
 "LIABILITY"
shall mean any debt, obligation, duty or liability of any nature including any
unknown, undisclosed, unmatured, unaccrued, unasserted, contingent, indirect,
conditional, implied, vicarious, derivative, joint, several or secondary
liability, regardless of whether such debt, obligation, duty or liability would
be required to be disclosed on a balance sheet prepared in accordance with GAAP
and regardless of whether such debt, obligation, duty or liability is
immediately due and payable.

1.12
 "MATERIAL
ADVERSE CHANGE" and "MATERIAL ADVERSE EFFECT" shall mean one or more changes in,
or effects on, the business, financial condition, operations, results of
operations, assets or liabilities of Itec or Rose Waste (as the case may be)
that, individually or in the aggregate, results in or would reasonably be
expected to result in a material adverse effect on, or a material adverse change
in, the business, financial condition, operations, results of operations, assets
or liabilities of the affected party taken as a whole. A statement in this
Agreement that an event or state of affairs "has," "does not have," "would
have," or "would not have" (or similar statements) a Material Adverse Change or
Material Adverse Effect, shall be deemed to mean that such event or state of
affairs both: (a) has (or does not have), does (or does not), will (or will
not), or would (or would not), result in, and/or (b) would (or would not)
reasonably be expected to result in, the consequences described in the preceding
sentence.

1.13
 "MERGER
AGREEMENTS" shall include: (a) this Agreement; (b) the Certificate of Merger,
(c) the Employment Agreement, (d) the Pledge Agreement, (e) the Letter Agreement
and (f) all other agreements to which at least one party to this Agreement will
be a party and that must be executed pursuant to this Agreement.

1.14
 "ORDER"
shall mean any:

(a)
 order,
judgment, injunction, edict, decree, ruling, pronouncement, determination,
decision, opinion, verdict, sentence, subpoena, writ or award that is issued,
made, entered, rendered or otherwise put into effect by or under the authority
of any court, administrative agency or other governmental body or any arbitrator
or arbitration panel; or

(b)
 Contract
with any governmental body that is entered into in connection with any
Proceeding.

1.15
 "ORDINARY
COURSE OF BUSINESS". An action taken by or on behalf of Itec or Rose Waste (as
the case may be) shall not be deemed to have been taken in the "Ordinary Course
of Business" unless:

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(a)
 such
action is consistent with such party's past customary business practices and
taken in the ordinary course of such party's normal day to day
operations;

(b)
 such
action is not required to be authorized by such party's stockholders, board of
directors or any committee of its board of directors and does not require any
other separate or special authorization of any nature; and

(c)
 such
action is similar in nature and magnitude to actions customarily taken, without
any special or separate authorization, in the ordinary course of the normal day
to day operations of other entities that are employed in businesses similar to
such party's business.

1.16
 "PERMITTED
ENCUMBRANCE" shall mean any (i) statutory lien for taxes, (ii) encumbrance in
the nature of zoning restrictions, easements, rights or restrictions of record
on the use of real property if the same do not materially detract from the value
of the property encumbered thereby or materially impair the use of such property
in the Business as currently conducted or proposed to be conducted, (iii)
statutory or common law lien to secure landlords, lessors or renters under
leases or rental agreements confined to the premises rented, (iv) deposit or
pledge made in connection with, or to secure payment of, worker's compensation,
unemployment insurance, old age pension programs mandated under applicable law
or other social security, (v) statutory or common law liens in favor of
carriers, warehousemen, mechanics and materialmen, statutory or common law liens
to secure claims for labor, materials or supplies and other like liens, and (vi)
restrictions on transfer of securities imposed by applicable state and federal
laws.

1.17
 "PERSON"
shall mean any individual, Entity or governmental body.

1.18
 "PROCEEDING"
shall mean any action, claim, suit, litigation, arbitration, proceeding
(including any civil, criminal, administrative, investigative or appellate
proceeding and any informal proceeding), prosecution, contest, hearing, inquiry,
inquest, audit, examination or investigation commenced, brought, conducted or
heard by or before any governmental body or any arbitrator or arbitration
panel.

1.19
 "SEC"
shall mean the Securities and Exchange Commission.

1.20
 "SECURITIES
ACT" shall mean the Securities Act of 1933, as amended.

1.21
 "ROSE
WASTE CONTRACT" shall mean any Contract:

(a)
 to which
Rose Waste is a party;

(b)
 by which
Rose Waste or any of its assets is or may become bound or under which Rose Waste
has or may become subject to any obligation; or

(c)
 under
which Rose Waste has or may acquire any right or interest.

 

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1.22
 "ROSE
WASTE STOCKHOLDER" shall mean a holder of shares of Rose Waste's capital stock,
including Rose Waste Common Stock (defined in Section 4.5).

2.
 PLAN OF
MERGER

2.1
 The
Merger. Subject to the terms and conditions of this Agreement, Merger Sub will
merge with and into Rose Waste pursuant to this Agreement and the Certificate of
Merger and in accordance with applicable provisions of the laws of the State of
Delaware and California as follows:

(a)
 Timing of
the Merger.

    (i)
 The
Closing. Unless this Agreement has first been terminated pursuant to Article 10
hereof, the closing of the transactions contemplated by this Agreement (the
"CLOSING") will take place at the offices of The Otto Law Group, PLLC, 900
Fourth Avenue, Suite 3140, Seattle, Washington at 11:00 a.m., Pacific Standard
Time upon the satisfaction of all the conditions to closing set forth in
Sections 8 and 9, or waiver thereof, or at such date, such other place, time and
date as Rose Waste and Itec may mutually select, but in any event no later than
one hundred and fifty (150) days after the Effective Time (defined in Section
(ii) below) (the "CLOSING DATE").

 

(ii)
 Effective
Time of the Merger. The Merger shall become effective once a Certificate of
Merger has been properly executed and duly filed with the Delaware and
California Secretary of State and appropriate evidence of acceptance for filing
has been obtained. This filing shall be made on the Execution Date. For the
purposes of this Agreement, the term "EFFECTIVE TIME" means the date and time at
which such Certificate of Merger is filed or at such later time as is provided
in the Certificate of Merger.

(b)
 Effects
of the Merger. At the Effective Time: (i) Merger Sub will merge with and into
Rose Waste, Rose Waste will be the Surviving Corporation and the separate
existence of Merger Sub will thereupon cease; (ii) each share of common stock of
Merger Sub outstanding immediately prior to the Effective Time will convert into
one (1) share of common stock of the Surviving Corporation; (iii) the Articles
of Incorporation and Bylaws of Rose Waste as of the Effective Time will remain
the Articles of Incorporation and Bylaws of the Surviving Corporation; (iv) the
directors of Rose Waste immediately prior to the Effective Time will remain the
directors of the Surviving Corporation; (v) the officers of Rose Waste
immediately prior to the Effective Time will remain the officers of the
Surviving Corporation; (vi) each share of Rose Waste Common Stock (defined in
Section 4.5) outstanding immediately prior to the Effective Time will be
converted as provided in Section 2.2; and (vii) the Merger will, from and after
the Effective Time, have all of the effects provided by applicable
law.

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2.2
 Conversion
of Shares.

(a)
 Conversion
of Shares.

    (i)
 Overall
Agreement. In connection with the Merger and pursuant to the provisions of this
Agreement and the Merger Agreements, Itec will issue to George Gitschel, Rose
Waste’s sole shareholder, 4,000,000 fully paid and nonassessable shares of Itec
Common Stock (the "TOTAL EXCHANGE SHARES," and each share individually, an
"EXCHANGE SHARE") in exchange for all of the capital stock of Rose Waste
outstanding immediately prior to the Effective Time. Each share of Rose Waste
Common Stock owned by George Gitschel immediately prior to the Effective Time
shall be canceled and extinguished without any conversion pursuant to this
Section 2.2. 

    (ii)
 Adjustment
for Capital Changes. If, prior to the Closing Date, Itec or Rose Waste
recapitalizes through a split-up of its outstanding shares into a greater
number, or a combination of its outstanding shares into a lesser number,
reorganizes, reclassifies or otherwise changes its outstanding shares into the
same or a different number of shares of other classes (other than through a
split-up or combination of shares provided for in the previous clause), or
declares a dividend on its outstanding shares payable in shares or securities
convertible into shares, or otherwise issues shares or any rights to shares of
Itec stock, the Total Exchange Shares will be adjusted appropriately so as to
maintain the proportionate interests of George Gitschel in Itec Common Stock at
the time of such recapitalization (“Total Exchange Shares Adjustment”);
provided,
however, that
there shall be no Total Exchange Shares Adjustment on account of either (i) the
Financing, or (ii) the issuance to Brean Murray & Co., Inc. of 5% of the
issued and outstanding common stock of Itec in connection with certain
investment banking services being provided in connection with the Financing
(defined in Section 11.1 below). 

    (iii)
 Fractional
Shares. No fractional shares of Itec Common Stock will be issued in connection
with the Merger. However, in lieu thereof, each Rose Waste Stockholder who would
otherwise be entitled to receive a fraction of an Exchange Share will receive
from Itec one (1) full share.

2.3
 Piggyback
Registration Rights. If Itec proposes to register any of its securities under
the Securities Act (other than pursuant to a Form S-4, Form S-8 or any other
successor form of limited purpose), it will give written notice by registered
mail at least thirty (30) business days prior to the filing of each such
registration statement to the holder of the Total Exchange Shares of its
intention to do so. If the holder notifies Itec within twenty (20) business days
after receipt of any such notice of its desire to include any of the Total
Exchange Shares in such proposed registration statement, Itec shall afford the
holder the opportunity to have any such amount of the Total Exchange Shares
registered under such registration statement.

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2.4
 Escrow.

(a)
 Escrow
Agent. George Gitschel, President of Rose Waste (the "ESCROW AGENT") shall hold,
release and perform other tasks related to the Rose Waste Common Stock pursuant
to the provisions of this Section 2.4 and the Pledge Agreement, a copy of which
is attached hereto as Exhibit
A (the
“Pledge Agreement”).

(b)
 Rose
Waste Common Stock. The Escrow Agent, the owner of all the Rose Waste Common
Stock, hereby agrees that at the Effective Time he shall act as the Escrow Agent
during the term of the Escrow Period in conformity with this Agreement and the
Pledge Agreement.

(c)
 Escrow
Period. At the Effective Time, the Escrow Agent will hold the Rose Waste Common
Stock and release the Rose Waste Common Stock to Itec upon expiration of the
Escrow Period and in conformity with this Agreement and the other Merger
Agreements. For the purposes of this Agreement, the "ESCROW PERIOD" means that
time period beginning at the Effective Time and ending on the Closing
Date.

2.5
 Securities
Law Compliance.

(a)
 Issuance
of Exchange Shares/Private Placement. The parties to this Agreement intend that
Itec shall issue the Exchange Shares pursuant to a "private placement" under
Regulation D and Section 4(2) of the Securities Act and applicable state
securities laws. The Exchange Shares shall constitute "restricted securities"
within the meaning of the Securities Act. The certificates for Exchange Shares
to be issued in the Merger shall bear appropriate legends to identify such
privately placed shares as being restricted under the Securities Act, to comply
with applicable state securities laws. Rose Waste shall furnish Itec with all
information concerning Rose Waste and Rose Waste Stockholders as may be
reasonably requested in connection with any action contemplated by this Section
2.5. Rose Waste shall further assist Itec by carrying out the covenants in
Section 6.12.

2.6
 Tax and
Accounting Aspects of the Merger.

(a)
 Tax Free
Reorganization. The parties intend to adopt this Agreement as a tax-free plan of
reorganization and to consummate the Merger in accordance with the provisions of
Section 368(a)(1)(A) and Section 368(a)(2)(E) of the Code. The value of the
Exchange Shares to be received in the Merger is approximately equal, in each
instance, to the value of Rose Waste Common Stock to be surrendered in exchange
therefor. The Exchange Shares issued in the Merger will be issued solely in
exchange for Rose Waste Common Stock, and no other transaction other than the
Merger represents, provides for or is intended to be an adjustment to, the
consideration paid for Rose Waste Common Stock. The parties shall treat the
Merger as a tax-free reorganization described in Section 368(a)(2)(E) of the
Code and shall not take any position on any tax returns or for any federal
income tax purposes that is inconsistent with such treatment or is inconsistent
with this Section 2.6(a). In addition, Itec will, after the Closing continue
Rose Waste's historic business or use a significant portion of Rose Waste's
business assets in a business. Itec and Merger Sub do not have a present intent
following the Merger to cause Rose Waste to issue additional shares of its stock
that would result in Itec losing control of Rose Waste within the meaning of
Section 368(c) of the Code. Itec has no current plan or intention to liquidate
Rose Waste, to merge Rose Waste with or into another corporation, to sell or
otherwise to dispose of the stock of Rose Waste, or to cause Rose Waste to sell
or otherwise to dispose of any of the assets of Rose Waste. Itec will not in
connection with the Merger redeem its stock furnished in exchange for Rose Waste
stock. Prior to the Merger, Itec will be in control of Merger Sub within the
meaning of Section 368(c) of the Code. Itec has no plan or intention to
reacquire any of its stock issued in the Merger. Itec, Merger Sub, Rose Waste
and the stockholders of Rose Waste will pay their respective expenses, if any,
incurred in connection with the Merger. None of the compensation received by any
stockholder of Rose Waste will be separate consideration for, or allocable to,
any of their shares of Rose Waste stock; none of the shares of Itec stock
received by any stockholder of Rose Waste will be separate consideration for, or
allocable to, any services, and the compensation paid to any stockholder of Rose
Waste will be for services actually rendered and will be commensurate with
amounts paid to third parties bargaining at arm's length for similar services.
Merger Sub does not have any liabilities nor are any of its assets subject to
any liabilities.

 

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(b)
 Accounting.
The parties intend that the Merger be treated as a purchase for accounting
purposes.

3. ADDITIONAL
AGREEMENTS

3.1
 Public
Announcement.

(a)
 Rose
Waste shall make no public disclosure regarding the negotiation of the Merger
without the prior written consent of Itec. Itec shall make no public disclosure
regarding the negotiation of the Merger unless, in the reasonable opinion of
Itec's counsel after consultation with Rose Waste's counsel, such disclosure is
required by law, in which event Rose Waste shall have a reasonable opportunity
to comment on any public disclosure before it is made. Itec and Rose Waste will
cooperate to prepare a joint press release after the Execution Date of this
Agreement.

(b)
 Rose
Waste shall take reasonable actions necessary to avoid any trading in Itec
equity securities by Rose Waste's directors, officers, employees and agents that
would be based on material nonpublic information, that relates to the proposed
Merger or that was learned in the due diligence process.

3.2
 Confidentiality.
Rose Waste and Itec each recognize that they have received and will receive
confidential information concerning the other during the course of the Merger
negotiations, preparations and due diligence. Accordingly, Itec and Rose Waste
each: (a) shall use its respective Best Efforts to prevent the unauthorized
disclosure of any confidential information concerning the other that was or is
disclosed during the course of such negotiations, preparations and due
diligence; and (b) shall not make use of or permit to be used any such
confidential information other than for the purpose of effectuating the Merger
and related transactions. The obligations of this section will not apply to
information that: (a) is or becomes part of the public domain other than by
fault of the receiving party; (b) is disclosed by the disclosing party to third
parties without restrictions on disclosure; (c) is received by the receiving
party from a third party without breach of a contractual or fiduciary
nondisclosure obligation to the other party; or (d) is required to be disclosed
by law. If this Agreement is terminated, all copies of documents containing
confidential information shall be returned by the receiving party to the
disclosing party. In addition to this paragraph 3.2, the provisions of the
Mutual Nondisclosure Agreement executed by the parties in April 27, 2005 (the
"NDA") will apply. To the extent there is a contradiction or ambiguity between
this Agreement and the NDA, the terms of this Agreement shall
control.

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3.3
 Purposely
Left Blank

3.4
 Purposely
Left Blank

3.5
 New
Options. Before the Closing Date, at the request and direction of George
Gitschel, Itec shall adopt a new stock option plan acceptable to George Gitschel
(the "NEW ITEC OPTION PLAN").

3.6
 Fees and
Expenses. Each party will be responsible for its own fees and expenses incurred
in connection with the Merger. However, Itec will pay (i) the reasonable
accounting fees incurred by Rose Waste with respect to the audit of the Rose
Waste Financial Statements, and (ii) the reasonable legal fees of Rose Waste in
the event this Agreement is rescinded on account of Itec not completing the
Financing (defined in Section 11.1 below).

3.7
 Integration
Matters. Rose Waste and Itec will cooperate in good faith to identify and, to
the extent practicable, to resolve matters regarding the orderly integration of
their respective operations, including matters relating to acceptable positions
with Itec for Key Employees and the retention of other Rose Waste employees who
will remain after the Merger.

3.8
 Further
Assurances. If, at any time before or after the Closing Date, any of the Parties
considers or is advised that any further deeds, assignments or assurances are
reasonably necessary or desirable to vest, perfect or confirm in each other
title to any property or rights to be vested, perfected or confirmed pursuant to
the Merger Agreements, the Parties and their proper officers and directors are
authorized and shall use their Best Efforts to execute and deliver all such
proper deeds, assignments and assurances and do all other things necessary or
desirable to vest, perfect or confirm title to such property or rights in the
other and otherwise to carry out the purpose of this Agreement.

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4.
 REPRESENTATIONS
AND WARRANTIES OF ROSE WASTE

Except as
specifically set forth in the disclosure letter provided by Rose Waste to Itec
simultaneously with the signing of this Agreement, dated as of the date of this
Agreement and as updated from time to time in writing delivered to Itec any time
thereafter up until the Closing Date (the "ROSE WASTE DISCLOSURE SCHEDULE"), the
parts of which are numbered to correspond to the section numbers of this
Agreement, Rose Waste hereby represents and warrants to Itec and Merger Sub as
follows:

4.1
 Organization
and Good Standing. Rose Waste is a corporation duly organized, validly existing
and in good standing under the laws of California and is qualified as a foreign
corporation in each jurisdiction in which a failure to be so qualified would
reasonably be expected to have a Material Adverse Effect. Rose Waste has
provided to Itec a true and complete list of each jurisdiction in which Rose
Waste has employees or owns or leases property and of each jurisdiction in which
Rose Waste is qualified to do business.

4.2
 Power,
Authorization and Validity.

(a)
 Rose
Waste has the right, power, legal capacity and authority: (i) to carry on its
business as now conducted and as proposed to be conducted; (ii) to own, use and
lease its properties in the manner in which its properties are currently owned,
used and leased and in the manner in which its properties are proposed to be
owned, used and leased; (iii) to perform its obligations under all Rose Waste
Contracts; and (iv) subject to stockholder and director approval of this
Agreement and the Merger, to enter into and perform its obligations under this
Agreement and all other agreements to which Rose Waste is or will be a party
that are required to be executed pursuant to this Agreement (collectively with
this Agreement, the "ROSE WASTE MERGER AGREEMENTS"). The execution, delivery and
performance of Rose Waste Merger Agreements have been duly and validly approved
and authorized by Rose Waste's Board of Directors and Rose Waste Stockholders.

(b)
 No
filing, authorization or approval with any governmental body, is necessary to
enable Rose Waste to enter into and perform its obligations under Rose Waste
Merger Agreements, except for: (i) the filing of the Certificate of Merger with
the Delaware and California Secretaries of State and the filing of appropriate
documents with the relevant authorities of other states in which Rose Waste is
qualified to do business, if any; (ii) such filings as may be required to comply
with federal and state securities laws; (iii) approval by Rose Waste
Stockholders of the transactions contemplated hereby; and (iv) consents required
under Contracts.

(c)
 Rose
Waste Merger Agreements are, or when executed by Rose Waste will be, valid and
binding obligations of Rose Waste enforceable in accordance with their
respective terms, except as to the effect, if any, of: (i) applicable bankruptcy
and other similar laws affecting the rights of creditors generally; (ii) rules
of law governing specific performance, injunctive relief and other equitable
remedies; and (iii) the enforceability of provisions requiring indemnification;
provided, however, that the Certificate of Merger will not be effective until
filed with the Delaware and California Secretaries of State.

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4.3
 No
Violation of Existing Agreements. Neither the execution and delivery of any of
Rose Waste Merger Agreements, nor the consummation of the transactions
contemplated hereby, will conflict with or (with or without notice and/or lapse
of time) result in a termination, breach, impairment or violation of: (a) any
provision of Rose Waste Certificate of Incorporation, Rose Waste bylaws or other
charter documents, as currently in effect; (b) in any material respect, any
material Rose Waste Contract; or (c) any federal, state, local or foreign Order,
statute, rule or regulation applicable to Rose Waste or its assets or properties
the violation of which would have a Material Adverse Effect. The consummation of
the Merger and the transfer to Itec of all of Rose Waste's material rights,
licenses, franchises, leases and Rose Waste Contracts will not require the
consent of any third party.

4.4
 Corporate
Documents.

(a)
 Rose
Waste has made available to Itec for examination complete and accurate copies of
all documents and information in the possession of Rose Waste or other Exhibits
called for by this Agreement, including, without limitation, the following: (i)
Rose Waste Certificate of Incorporation, Rose Waste bylaws or other charter
documents, as currently in effect; (ii) Rose Waste's minute book containing all
records of all proceedings, consents, actions and meetings of the stockholders,
the Board of Directors and any committees of the Board of Directors; (iii) its
stock ledger and journal reflecting all stock issuances, transfers and all other
stock records; and (iv) all permits, Orders and consents issued by any
regulatory agency with respect to Rose Waste, or any securities of Rose Waste,
and all applications for such permits, Orders and consents.

(b)
 There has
not been any material violation of any of the provisions of Rose Waste
Certificate of Incorporation or Rose Waste bylaws or of any resolution adopted
by Rose Waste Stockholders or Rose Waste Board of Directors, and to Rose Waste's
Knowledge, no event has occurred, and no condition or circumstance exists, that
likely would (with or without notice and/or lapse of time) constitute or result
directly or indirectly in such a violation.

(c)
 Rose
Waste's books of account, stock records, minute books and other records are
accurate, up to date and complete and have been maintained in accordance with
internal practices consistently applied. The minute book made available to Itec
is Rose Waste's only original minute book. All of Rose Waste's records are in
Rose Waste's actual possession and direct control.

4.5
 Capitalization.

(a)
 Capital
Stock. Rose Waste's authorized capital stock consists of: (i) 1,000,000 shares
of Common Stock ("ROSE WASTE COMMON STOCK"). As of the date of this Agreement:
(i) 1,000,000 shares of Rose Waste Common Stock have been issued and are
outstanding. George Gitschel holds all of the Rose Waste Common Stock and is the
only shareholder of Rose Waste.

 

12

(b)
 Options
and Warrants. There is no: (i) outstanding preemptive right, subscription,
option, call, warrant or right (whether or not currently exercisable) to acquire
from Rose Waste or, to Rose Waste's Knowledge, from affiliates any shares of the
capital stock or other securities of Rose Waste; (ii) outstanding security,
instrument or obligation issued by Rose Waste or controlled affiliates that is
or may become convertible into or exchangeable for any shares of the capital
stock or other securities of Rose Waste; (iii) stockholders' rights plan (or
similar plan commonly referred to as a "poison pill") or Contract under which
Rose Waste is or may become obligated to sell or otherwise issue any shares of
its capital stock or any other securities; (iv) Contract to which Rose Waste is
a party relating to the voting or registration of or restricting any Person from
purchasing, selling, pledging or otherwise disposing of (or granting any option
or similar right with respect to) any shares of Rose Waste Common Stock; or (v)
condition or circumstance, to Rose Waste's Knowledge, that likely would directly
or indirectly give rise to or provide a basis for the assertion of a claim by
any Person to the effect that such Person is entitled to acquire or receive any
shares of capital stock or other securities of Rose Waste.

(c)
 All
issued and outstanding shares of Rose Waste Common Stock have been duly
authorized and validly issued, are fully paid and non-assessable, are not
subject to any right of rescission, and have been offered, issued, sold and
delivered by Rose Waste in compliance with all registration or qualification
requirements (or applicable exemptions therefrom) of applicable federal and
state securities laws.

(d)
 Rose
Waste has not repurchased, redeemed or otherwise reacquired (and, except as
contemplated by this Agreement, has not agreed, committed or offered, in writing
or otherwise, to reacquire) any shares of capital stock or other securities of
Rose Waste. There are no shares of Rose Waste Common Stock held in treasury by
Rose Waste.

(e)
 There are
no shares of Rose Waste Common Stock reserved for future issuance pursuant to
stock options granted, director's and officer's stock option and stock purchase
plans, employee stock option and stock purchase plans and all other such similar
plans. 

 

(f)
 Rose
Waste is not under any obligation to register under the Securities Act any of
its presently outstanding securities or any securities that may be subsequently
issued.

 

4.6
 Board of
Directors and Officers. George Gitschel is the only member of Rose Waste's Board
of Directors and is its only executive officer.

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4.7
 Subsidiaries
and Other Interests. Rose Waste does not have any subsidiaries or any interest,
direct or indirect, in any Entity.

4.8
 Rose
Waste Financial Statements. Rose Waste has provided to Itec a true and complete
copy of the unaudited financial statements of Rose Waste for the annual periods
ended December 31, 2003 and 2004 (the “ROSE WASTE UNAUDITED FINANCIAL
STATEMENTS”). Subject to delivery by its auditors, within sixty (60) days of the
Execution Date, Rose Waste shall deliver to Itec its audited financial
statements for the fiscal years ended December 31, 2003 and 2004 (the "ROSE
WASTE FINANCIAL STATEMENTS"). The Rose Waste Unaudited Financial Statements: (i)
are in accordance with the books and records of Rose Waste; (ii) fairly present
in all material respects Rose Waste's financial condition at the date therein
indicated and the results of operations for the period therein specified; and
(iii) to the best of Rose Waste’s Knowledge, have been prepared in accordance
with GAAP (subject to customary year-end adjustments). Except as set forth in
the Rose Waste Unaudited Financial Statements, Rose Waste does not have any
material Liability, expense, claim, deficiency, guaranty or endorsement of any
type, whether accrued, absolute, contingent, matured, unmatured or other
(whether or not required to be reflected in financial statements in accordance
with GAAP). George Gitschel shall use his best efforts in assisting Rose Waste’s
auditors in delivering the Rose Waste Financial Statements within sixty (60)
days of the Execution Date.

4.9
 Title to
Properties.

(a)
 Rose
Waste has good and marketable title to all of its assets as shown on the Rose
Waste Unaudited Financial Statements and all other assets reflected in Rose
Waste's books and records as being owned by Rose Waste, free and clear of all
Encumbrances except for Permitted Encumbrances and assets disposed of in the
Ordinary Course of Business. All machinery and equipment included in such
properties is in good condition and repair, normal wear and tear
excepted.

(b)
 Rose
Waste owns no real property, nor has it ever owned any real property. All leases
of real or personal property to which Rose Waste is a party are fully effective
and afford Rose Waste peaceful and undisturbed possession of the subject matter
of the lease. The Surviving Corporation will obtain a valid ownership or
leasehold interest in all such personal property that Rose Waste currently owns
or leases and all real property that Rose Waste currently leases, as of the date
of this Agreement, in each case free and clear of all title defects and
Encumbrances of any kind, except: (i) mechanics', carriers', workers' and other
similar liens arising in the Ordinary Course of Business, (ii) liens for current
taxes not yet due and payable and (iii) Permitted Encumbrances.

(c)
 Rose
Waste is not in material violation of any law or regulation (including but not
limited to zoning, building, safety or environmental ordinance, regulation or
requirements) applicable to the operation of owned or leased properties the
violation of which would have a Material Adverse Effect, nor has Rose Waste
received any written notice of violation of any such law or regulation with
which it has not complied.

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4.10
 Intellectual
Property.

(a)
 As used
herein, the term "INTELLECTUAL PROPERTY RIGHTS" shall mean all worldwide
industrial and intellectual property rights, including, without limitation,
patents, patent applications, patent rights, trademarks, trademark applications,
trade names, service marks, service mark applications, copyright, copyright
applications, franchises, licenses, inventories, know-how, trade secrets,
customer lists, proprietary processes and formulae, all source and object code,
algorithms, architecture, structure, display screens, layouts, inventions,
development tools and all documentation and media constituting, describing or
relating to the above, including, without limitation, manuals, memoranda and
records.

(b)
 Rose
Waste owns or has a written license to, and has the unrestricted right to use,
sell and license, all Intellectual Property Rights material to Rose Waste's
business or conduct of its businesses (such Intellectual Property Rights
collectively referred to as the "ROSE WASTE IP RIGHTS") and such rights to use,
sell or license are reasonably sufficient for such conduct of its businesses. No
portion of Rose Waste IP Rights is subject to: (i) any Encumbrance, or (ii) any
outstanding Order, stipulation or Contract restricting in any manner Rose
Waste's ability to license or exploit such Rose Waste IP Rights, except for
standard non-exclusive consumer software licenses granted in the Ordinary Course
of Business. There are no royalties, honoraria, fees or other payments payable
by Rose Waste to any Person by reason of the ownership, use, license, sale or
disposition of Rose Waste IP Rights.

(c)
 After the
Closing Date of the Merger, the Surviving Corporation will own or have the
unrestricted right to use, sell, license and dispose of, and otherwise exercise
rights with respect to all Rose Waste IP Rights. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby will not: (i) constitute a material breach of any Contract
governing any Rose Waste IP Right or (ii) cause the forfeiture or termination or
give rise to a right of forfeiture or termination of any Rose Waste IP Right or
materially impair the right of Rose Waste or Itec to use, sell or license all or
any portion of any Rose Waste IP Right.

(d)
 Except as
set forth on Section 4.10(e), neither the past, current or intended use of Rose
Waste IP Rights in Rose Waste's business as it has been conducted prior to the
Closing, nor the manufacture, marketing, license, sale or intended use of any
product currently licensed or sold by Rose Waste or currently under development
by Rose Waste, causes Rose Waste to violate any license or Contract between Rose
Waste and any third party or to violate or infringe any Intellectual Property
Rights of any other Person. There is no pending or, to Rose Waste's Knowledge,
threatened Order or Proceeding contesting the validity, ownership or right to
use, sell, license or dispose of any Rose Waste IP Right nor, to Rose Waste's
Knowledge, is there any basis for any such Order or Proceeding. Rose Waste has
not received any notice asserting that any Rose Waste IP Right or the proposed
use, sale, license or disposition of a Rose Waste IP Right conflicts or will
conflict with the Intellectual Property Rights or other rights of any other
party, nor, to Rose Waste's Knowledge, is there any basis for any such
assertion. Rose Waste is not wrongfully using any confidential information or
trade secrets of any former employer of any past or present Rose Waste
employees. Rose Waste has not entered into any Contract to indemnify any other
Person against any charge of infringement relating to any Intellectual Property
Rights.

15

  (e)
 Rose
Waste has taken reasonable and practicable steps designed to safeguard and
maintain the secrecy and confidentiality of, and its proprietary rights in, all
Rose Waste IP Rights. There is no material unauthorized use, infringement or
misappropriation of any Rose Waste IP Right by any third party, including, to
the knowledge or Rose Waste, any Rose Waste employee. All Rose Waste officers,
employees and consultants have executed and delivered to Rose Waste an agreement
regarding the protection of proprietary information and the assignment to Rose
Waste of all Intellectual Property Rights arising from the services performed
for Rose Waste by such persons, and Rose Waste has delivered to Itec copies of
all such agreements. No Rose Waste employee or consultant is in violation of any
material term of any employment Contract, patent disclosure agreement or any
other Contract relating to the relationship of such employee with Rose Waste or
any other party (including prior employers) because of the nature of the
business conducted or proposed by Rose Waste. Rose Waste has provided Itec with
a list of all applications, registrations, filings and other formal actions made
or taken pursuant to federal, state and foreign laws by Rose Waste to perfect or
protect its interest in Rose Waste IP Rights, including, without limitation, all
patents, patent applications, trademarks, trademark applications and service
marks. No loss, cancellation, termination or expiration of any such registration
is reasonably foreseeable.

4.11
 Absence
of Certain Changes and Actions.

(a)
 Since
December 5, 2004, there has not been with respect to Rose Waste:

    (i)
 any
Material Adverse Effect;

    (ii)
 any
contingent Liability incurred as guarantor or otherwise with respect to the
obligations of others;

    (iii)
 any
Encumbrance (other than Permitted Encumbrances) placed on any of the properties
or assets of which Rose Waste owns or has a substantial interest;

    (iv)
 any
material Liability incurred other than Liabilities incurred in the Ordinary
Course of Business;

16

(v) any
purchase, sale, pledge, hypothecation or other disposition, or any Contract for
the purchase, sale or other disposition, of any of Rose Waste's properties or
assets other than in the Ordinary Course of Business and not exceeding $10,000
in aggregate purchases, sales, pledges, hypothecations and other
dispositions;

(vi)
 any
damage, destruction or loss, whether or not covered by insurance, having a
Material Adverse Effect on Rose Waste's properties, assets or
business;

(vii)
 any
material labor dispute or claim of unfair labor practices, any change in the
compensation payable or to become payable to any of its officers, employees or
agents, or any bonus payment or arrangement made to or with any of such
officers, employees or agents;

(viii)
 any
change with respect to the employment of the Key Employees;

(ix)
 any
payment or discharge of a material Liability of Rose Waste, which Liability was
not either shown on the Rose Waste Unaudited Financial Statements or incurred in
the Ordinary Course of Business thereafter; or

(x)
 any
Liability of Rose Waste to any of Rose Waste's officers, directors or
stockholders or any loans or advances made thereby to any of Rose Waste's
officers, directors or stockholders, except normal compensation and expense
allowances payable to officers.

(b)
 Since the
date of the Rose Waste Unaudited Financial Statements, Rose Waste has
not:

(i)
 formed
any subsidiary or acquired any equity interest or other interest in any other
Entity;

(ii)
 amended
Rose Waste Certificate of Incorporation, Rose Waste bylaws or any other charter
document;

(iii)
 sold,
issued, granted or authorized the issuance or grant of: (A) any shares of its
capital stock of any class or other security (other than pursuant to exercise of
outstanding stock options); (B) any option, call, warrant, obligation,
subscription, option or right to acquire any capital stock or any other
security, except for New Options authorized pursuant to Section 3.5 and stock
options and warrants described in Section 4.5; or (C) any instrument convertible
into or exchangeable for any capital stock or other security; or accelerated the
vesting of any outstanding option or other security;

17

(iv)
 declared,
set aside or paid any dividend on, or made any other distribution in respect of,
Rose Waste's capital stock;

(v)
 effected
any split, combination or recapitalization of Rose Waste's capital stock or any
direct or indirect redemption, purchase or other acquisition of Rose Waste's
capital stock, or effected or been a party to any transaction relating to a
recapitalization, reclassification of shares, stock split, reverse stock split
or similar transaction;

(vi)
 effected
or been a party to any transaction relating to a merger, consolidation, sale of
all or substantially all of its assets, or similar transaction; or received,
accepted or otherwise entered into any Acquisition Proposal, or solicited,
initiated, encouraged or induced, or provided any nonpublic information to or
entered into any discussions with any Person for the purpose of soliciting,
initiating, encouraging or inducing, the making or submission of any Acquisition
Proposal;

(vii)
 made any
capital expenditures, except for such capital expenditures as in the aggregate,
measured by invoice amount, do not exceed $50,000 or were consented to by Itec
in writing;

(viii)
 entered
into any material lease or Contract for the purchase

or sale
of any property, real or personal, except in the Ordinary Course of Business
consistent with past practice;

(ix)
 borrowed
any money other than in the Ordinary Course of

Business,
but in any event not exceeding $10,000;

(x)
 made any
loan or advance to any other Person, including without limitation any Rose Waste
Stockholder (except for normal employee travel advances in the Ordinary Course
of Business);

(xi)
guaranteed or acted as a surety for any obligation except for

the
endorsement of checks and other negotiable instruments in the Ordinary Course of
Business, consistent with past practice, which are not material in
amount;

(xii)
 established,
amended or adopted any Rose Waste Employee Plan or Rose Waste Benefit
Arrangement (defined in Sections 4.18(c) and 4.18(e)), paid any bonus or made
any profit sharing or similar payment to, or increased the amount of the wages,
salary, commissions, fringe benefits or other compensation or remuneration
payable to, any of its directors, officers or employees, other than as required
under agreements existing on the date hereof disclosed to Itec prior to the
Execution Date; or entered into any new employment agreement with any such
person other than in the Ordinary Course of Business;

18

(xiii)
 written
off as uncollectable, or established any extraordinary reserve with respect to,
any account receivable or other indebtedness, except in the Ordinary Course of
Business;

(xiv)
 forgiven
any debt or Encumbrance or otherwise released or waived any right or
claim;

(xv)
 amended
or terminated any Contract or license to which it is a party except those
amended or terminated in the Ordinary Course of Business which are not material
in amount or effect;

(xvi)
 changed
any of its methods of accounting or accounting practices in any respect (other
than as required by GAAP); or

(xvii)
 agreed to
any audit assessment by any tax authority or filed

any
federal or state income or franchise tax return unless copies of such returns
have been delivered to Itec for its review prior to filing;

(xviii)
 entered
into any transaction or taken any other action outside the Ordinary Course of
Business (other than as disclosed and pursuant to this Agreement).

(c)
 Since the
date of the Rose Waste Unaudited Financial Statements, Rose Waste has not
agreed, committed or entered into any Contract, in writing or otherwise, to take
any of the actions referred to in Sections 4.11(a) or 4.11(b)
above.

4.12
 Liabilities
to Stockholders. To the Knowledge of Rose Waste, no Rose Waste Stockholders have
any claims of any nature against Rose Waste, including, without limitation, for
any undistributed earnings or profits of Rose Waste.

4.13
 Litigation.
There is no Proceeding pending against Rose Waste and, nor to Rose Waste's
Knowledge, has any Proceeding been threatened, that, if determined adversely to
the interests of Rose Waste, would be reasonably likely to have a Material
Adverse Effect on Rose Waste.

4.14
 Taxes.

(a)
 For the
purposes of this Agreement, the terms "TAX" and "TAXES" include all federal,
state, local and foreign income, gains, franchise, excise, property, sales, use,
employment, license, payroll, occupation, recording, value added or transfer
taxes, governmental charges, fees, levies or assessments (whether payable
directly or by withholding), and, with respect to such taxes, any estimated tax,
interest and penalties or additions to tax and interest on such penalties and
additions to tax.

(b)
 Rose
Waste has: (i) filed all federal, state, local and foreign tax returns required
to be filed; (ii) paid all taxes shown on such returns and; (iii) established an
adequate accrual or reserve for the payment of all taxes payable in respect of
the periods subsequent to the periods covered by the most recent applicable tax
returns. To the best of Rose Waste’s Knowledge, Rose Waste has no material
Liability for taxes in excess of the amount so paid or accruals or reserves so
established in the Rose Waste Unaudited Financial Statements.

19

(c)
 No
deficiencies for any tax have been threatened, claimed, proposed or assessed in
writing. No Rose Waste tax return currently is being audited by the Internal
Revenue Service or any state taxing agency or authority. Rose Waste has
delivered to Itec accurate and complete copies of tax returns filed by Rose
Waste during the past three years.

4.15
 Compliance
with Laws. To Rose Waste's Knowledge, Rose Waste has complied and is in
compliance, in all material respects, with all applicable laws, ordinances,
regulations and rules, and all Orders applicable to it or to its assets,
properties and business and the violation of which would have a Material Adverse
Effect, including, without limitation:

(a)
 all
applicable federal and state securities laws and regulations;

(b)
 all
applicable federal, state, and local laws, ordinances, regulations, and all
Orders pertaining to: (i) the sale, licensing, leasing, ownership, or management
of its owned, leased or licensed real or personal property, products and
technical data; (ii) employment and employment practices, terms and conditions
of employment, and wages and hours; and (iii) safety, health, fire prevention,
environmental protection, toxic waste disposal, building standards, zoning and
other similar matters; and

Rose
Waste has received all material permits and approvals from, and has made all
filings with, third parties, including government agencies and authorities, that
are necessary in connection with its present business.

4.16
 Contracts
and Commitments.

(a)
 Rose
Waste is not a party to any Contract which has had or would reasonably be
expected to have a Material Adverse Effect on Rose Waste. Rose Waste is not a
party nor is subject to any Contracts, any of which is material to the business,
financial condition, operations, results of operations, assets or Liabilities of
Rose Waste ("MATERIAL ROSE WASTE CONTRACTs"), including, but not limited to
any:

(i)
 Contract
providing for payments by or to Rose Waste in an aggregate amount of: (A)
$50,000 or more in the Ordinary Course of Business, or (B) $10,000 or more not
in the Ordinary Course of Business;

(ii)
 material
Contract for the lease of real or personal property;

20

(iii)
 joint
venture Contract that involves a sharing of profits with other
Persons;

(iv)
 instrument
evidencing or related in any way to indebtedness for borrowed money by way of
direct loan, sale of debt securities, purchase money obligation, conditional
sale, guarantee or otherwise, except for trade indebtedness incurred in the
Ordinary Course of Business, and except as disclosed in Rose Waste Unaudited
Financial Statements;

(v)
 Contract
containing covenants purporting to limit Rose Waste's freedom to compete in any
line of business in any geographic area;

(vi)
 stock
redemption, stock option or stock purchase agreement, financing agreement,
license, lease or franchise;

(vii)
 any
government contract or subcontract; or

(viii)
 any other
material Contract entered into outside the Ordinary Course of
Business.

(b)
 Rose
Waste has delivered to Itec accurate and complete copies of all Material Rose
Waste Contracts. Each Material Contract is in full force and effect, and is
enforceable by Rose Waste in accordance with its material terms.

(c)
 Rose
Waste is not in breach or violation of or in default under any Material
Contract, and to Rose Waste's Knowledge: (i) no Person acting for Rose Waste has
violated or breached, or declared or committed any material default under, any
Material Contract; (ii) no event has occurred, and no circumstance or condition
exists, that likely would (with or without notice and/or lapse of time): (A)
result in a material violation or breach of any of the provisions of any
Material Contract, (B) give any Person the right to declare a default or
exercise any material remedy under any Material Contract, (C) give any Person
the right to accelerate the maturity or performance of any Material Contract, or
(D) give any Person the right to cancel, terminate or modify any Material
Contract; and (iii) Rose Waste has not waived any of its material rights under
any Material Contract.

(d)
 Rose
Waste has not received any notice that any Person against which Rose Waste has
or may acquire any rights under any Material Contract is insolvent and is not
able to satisfy all of such Person's Liabilities to Rose Waste, the failure of
which would result in a Material Adverse Effect.

(e)
 No Person
is currently materially renegotiating, nor has the contractual right to
materially renegotiate, any amount paid or payable to Rose Waste under any
Material Contract or any other material term or provision of any Material
Contract.

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(f)
 Rose
Waste has provided Itec with an accurate and brief description, as of the date
of this Agreement, of each proposed Contract as to which any bid, offer, written
proposal, term sheet or similar document has been submitted or received by Rose
Waste that would commit Rose Waste to provide services and is outstanding and if
entered would constitute a Material Contract.

(g)
 No party
to any Material Contract has notified Rose Waste in writing that Rose Waste has
failed to perform any material obligation thereunder. In addition, to Rose
Waste's Knowledge, there is no plan, intention or indication of any contracting
party to any Material Contract to cause the termination, cancellation or
modification of such Contract or to reduce or otherwise change its activity
thereunder in any material respect so as to adversely affect the benefits
derived or expected to be derived therefrom by Rose Waste.

(h)
 Rose
Waste has all material Rose Waste Contracts necessary to conduct its business in
the manner in which it is being conducted or is proposed to be conducted prior
to the Closing.

4.17
 Certain
Transactions and Agreements. None of Rose Waste Key Employees, nor to their
knowledge any member of their immediate families residing in the same
residence:

(a)
 has any
direct or indirect ownership interest in any firm or corporation that competes
with Rose Waste (except with respect to any interest in less than one percent of
the stock of any corporation whose stock is publicly traded) other than passive
investment in equity or debt securities;

(b)
 is
directly or indirectly interested in any Contract with Rose Waste, except for
normal compensation for services as a Rose Waste officer, director or employee;
or

(c)
 has any
material interest in any property, real or personal, tangible or intangible,
including without limitation Intellectual Property Rights, used in or pertaining
to Rose Waste's business, except for the normal rights of a
stockholder.

To Rose
Waste's knowledge, no Rose Waste officer or director, or any "affiliate" or
"associate" (as those terms are defined in Rule 405 promulgated under the
Securities Act) of any such person has had, either directly or indirectly, a
material interest in: (a) any Entity which purchases from or sells, licenses or
furnishes to Rose Waste any goods, property, technology or intellectual or other
property rights or services, or (b) any Contract to which Rose Waste is a party
or by which it may be bound or affected other than with respect to arms-length
transactions.

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4.18
 Employees,
ERISA and Other Compliance.

(a)
 General
Compliance. Rose Waste is in compliance in all material respects with all
applicable laws and Contracts relating to employment, employment practices,
wages, hours, and terms and conditions of employment, including, but not limited
to, employee compensation matters. With the exception of Rose Waste’s Employment
Agreement with Gorge Gitschel, Rose Waste has no employment or consulting
Contracts currently in effect that are not terminable at will (other than
agreements with the sole purpose of providing for the confidentiality of
proprietary information or assignment of inventions). All independent
contractors have been properly classified as independent contractors for the
purposes of federal and applicable state tax laws, laws applicable to employee
benefits and other applicable laws.

(b)
 Good
Labor Relations. Rose Waste: (i) to Rose Waste's knowledge has never been and is
not now subject to a union organizing effort; (ii) is not subject to any
collective bargaining agreement with respect to any of its employees; (iii) is
not subject to any other Contract with any trade or labor union, employees'
association or similar organization; and (iv) to its knowledge has no current
labor disputes. Rose Waste has good labor relations, and has no Knowledge of any
facts indicating that the consummation of the Merger or any of the other
transactions contemplated hereby will have a Material Adverse Effect on such
labor relations. As of the date of this Agreement, Rose Waste has no Knowledge
that any Key Employees or other key personnel intend to leave its employ. There
are no controversies pending or, to Rose Waste's Knowledge, threatened, between
Rose Waste and any of its employees that would be reasonably likely to result in
Rose Waste incurring any material Liability. All Rose Waste employees are
legally permitted to be employed by Rose Waste in the United States of
America.

(c)
 Employee
Plans. Rose Waste does not have any of the following: (i) an "employee benefit
plan", as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"); and (ii) with the exception of the Employment
Agreement with George Gitschel, other written or formal plans or Contracts
involving direct or indirect compensation or benefits (including any employment
Contracts entered into between Rose Waste and any employee of Rose Waste, but
excluding workers' compensation, unemployment compensation and other
government-mandated programs) currently or previously maintained, contributed to
or entered into by Rose Waste under which Rose Waste or any ERISA Affiliate (as
defined below) has any present or future Liability (collectively, the "ROSE
WASTE EMPLOYEE PLANS"). For purposes of this Section 4.18, "ERISA AFFILIATE"
shall mean any entity which is a member of: (i) a "controlled group of
corporations", as defined in Section 414(b) of the Code; (ii) a group of
entities under "common control", as defined in Section 414(c) of the Code; or
(iii) an "affiliated service group", as defined in Section 414(m) of the Code,
or treasury regulations promulgated under Section 414(o) of the Code, any of
which includes Rose Waste. Copies of all Rose Waste Employee Plans (and, if
applicable, related trust agreements) and all related documents, amendments and
written interpretations (including summary plan descriptions) thereto have been
delivered to Itec or its counsel. Rose Waste has performed in all material
respects all obligations required to be performed by it under each Rose Waste
Employee Plan, and each Rose Waste Employee Plan has been maintained
substantially in compliance with its terms and with the requirements prescribed
by any and all statutes, Orders, rules and regulations, which are applicable to
such Rose Waste Employee Plans.

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(d)
 Pension
Plans. No Rose Waste Employee Plans constitutes an "employee pension benefit
plan", as defined in Section 3(2) of ERISA.

(e)
 Benefit
Arrangements. Rose Waste has made available to Itec a complete list each
employment, severance (including all post-employment Liabilities) or other
similar Contract or policy and each Contract providing for insurance coverage
(including any self-insured arrangements), workers' benefits, vacation benefits,
severance benefits, disability benefits, death benefits, hospitalization
benefits, retirement benefits, deferred compensation, profit-sharing, bonuses,
stock options, stock purchase, phantom stock, stock appreciation or other forms
of incentive compensation or post-retirement insurance, compensation or benefits
for employees, consultants or directors which: (i) is not a Rose Waste Employee
Plan; (ii) is entered into, maintained or contributed to by Rose Waste; and
(iii) covers any employee or former employee of Rose Waste. Such Contracts and
policies as are described in this Section 4.18(e) are herein referred to
collectively as the "ROSE WASTE BENEFIT ARRANGEMENTS." Each Rose Waste Benefit
Arrangement has been maintained in substantial compliance with its terms and
with the requirements prescribed by any and all statutes, Orders, rules and
regulations which are applicable to such Rose Waste Benefit Arrangement. Rose
Waste has delivered to Itec or its counsel a complete and correct copy or
description of each Rose Waste Benefit Arrangement. All individuals who,
pursuant to the terms of any Rose Waste Benefit Arrangement, are entitled to
participate in any such Rose Waste Benefit Arrangement, are currently
participating in such Rose Waste Benefit Arrangement or have been offered an
opportunity to do so and have declined.

(f)
 Since
December 5, 2004, there has been no amendment to, written interpretation or
announcement (whether or not written) by Rose Waste relating to, or change in
employee participation or coverage under, any Rose Waste Employee Plan or Rose
Waste Benefit Arrangement that would increase materially the expense of
maintaining such Rose Waste Employee Plan or Rose Waste Benefit Arrangement in
the future other than the New Itec Option Plan.

(g)
 No
benefit payable or which may become payable by Rose Waste pursuant to any Rose
Waste Employee Plan or any Rose Waste Benefit Arrangement or as a result of or
arising under this Agreement shall constitute an "excess parachute payment" (as
defined in Section 280G(b)(1) of the Code) which is subject to the imposition of
an excise tax under Section 4999 of the Code or which would not be deductible by
reason of Section 280G of the Code.

(h)
 COBRA
Compliance. Rose Waste has provided, or will have provided prior to the Closing,
to individuals entitled thereto all required notices and coverage pursuant to
Section 4980B of the Code and the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended ("COBRA"), with respect to any "qualifying event" (as
defined in Section 4980B(f)(3) of the Code) occurring prior to and including the
Closing Date, and no material tax payable on account of Section 4980B of the
Code has been incurred with respect to any current or former employees (or their
beneficiaries) of Rose Waste.

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(i)
 No
Violation of Contracts. No Rose Waste employee is in violation of any term of
any employment Contract, patent disclosure agreement, non-competition agreement,
or any other Contract, or any restrictive covenant relating to the right of any
such employee to be employed by Rose Waste, or to use Intellectual Property
Rights of others. To Rose Waste's Knowledge, the mere fact of employment of any
Rose Waste employee does not subject Rose Waste to any Liability.

(j)
 Effect of
Merger.

(i)
 Rose
Waste is not a party to any Contract or plan with any Rose Waste Key Employee or
other key personnel: (A) the benefits of which are contingent, or the terms of
which are materially altered, upon the occurrence of a transaction involving
Rose Waste in the nature of any of the transactions contemplated by this
Agreement and the Certificate of Merger; (B) providing any term of employment or
compensation guarantee; or (C) providing severance benefits or other benefits
after the termination of employment of such employee regardless of the reason
for such termination of employment.

(ii)
 Rose
Waste is not a party to any Contract or plan, including, without limitation, any
stock option plan, stock appreciation rights plan or stock purchase plan, any of
the benefits of which will be materially increased, or the vesting of benefits
of which will be materially accelerated, by the occurrence of any of the
transactions contemplated by this Agreement and the Certificate of Merger or the
value of any of the benefits of which will be calculated on the basis of any of
the transactions contemplated by this Agreement and the Certificate of
Merger.

(k)
 Rose
Waste has made available to Itec a list of all current Rose Waste employees and
consultants and the current compensation of each.

4.19
 Books and
Records.

(a)
 The
books, records and accounts of Rose Waste: (i) are in all material respects
true, complete and correct; (ii) have been maintained in accordance with
standard industry practices on a basis consistent with prior years; (iii) are
stated in reasonable detail and accurately and fairly reflect the transactions
and dispositions of the assets of Rose Waste; and (d) accurately and fairly
reflect the basis for Rose Waste Unaudited Financial Statements.

(b)
 Rose
Waste has devised and maintains a system of internal accounting controls
reasonably sufficient to provide reasonable assurances that: (i) transactions
are executed in accordance with management's general or specific authorization;
(ii) transactions are recorded as necessary: (A) to permit preparation of
financial statements in conformity with GAAP or any other criteria applicable to
such statements, and (B) to maintain accountability for assets; and (iii) the
amount recorded for assets on Rose Waste's books and records is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.

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4.20
 Insurance.
Rose Waste maintains, and at all times since inception has maintained, fire and
casualty, general liability, business interruption, product liability and
sprinkler and water damage insurance which it believes to be reasonably prudent
for similarly sized and similarly situated businesses.

4.21
 Environmental
Matters.

(a)
 For the
purposes of this Agreement, the terms "DISPOSAL," "RELEASE," and "THREATENED
RELEASE" shall have the definitions assigned thereto by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. (S)
9601 et seq., as amended ("CERCLA"). For the purposes of this Agreement,
"HAZARDOUS MATERIALS" shall mean any hazardous or toxic substance, material or
waste which is or becomes prior to the Closing regulated under, or defined as a
"hazardous substance," "pollutant," "contaminant," "toxic chemical," "hazardous
material," "toxic substance" or "hazardous chemical" under: (i) CERCLA; (ii) any
similar federal, state or local law; or (iii) regulations promulgated under any
of the above laws or statutes.

(b)
 To Rose
Waste's Knowledge, none of Rose Waste's properties or facilities is in violation
of any federal, state or local law, ordinance, regulation or Order relating to
industrial hygiene or to the environmental conditions on, under or about such
properties or facilities, including, but not limited to, soil and ground water
condition.

(c)
 To Rose
Waste's Knowledge, during the time that Rose Waste has owned or leased
properties or owned or operated any facilities:

    (i)
 neither
Rose Waste nor any third party has used, generated, manufactured or stored on,
under or about such properties or facilities or transported to or from such
properties or facilities any Hazardous Materials;

    (ii)
 there
have been no disposals, releases or threatened releases of Hazardous Materials
(as defined below) on, from or under such properties or facilities;
and

    (iii)
 there has
been no litigation or Proceeding brought or threatened against Rose Waste by, or
any settlement reached by Rose Waste with, any party or parties alleging the
presence, disposal, release or threatened release of any Hazardous Materials on,
from or under any of Rose Waste's owned or leased properties or
facilities.

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(d)
 Rose
Waste has no Knowledge of any presence, disposals, releases or threatened
releases of Hazardous Materials on, from or under any of such properties or
facilities that may have occurred prior to Rose Waste having taken possession of
any of such properties or facilities.

4.22
 No
Brokers' Fees. Rose Waste is not obligated for the payment of fees or expenses
of any investment banker, broker, finder or other agent in connection with the
origin, negotiation or execution of this Agreement or the Certificate of Merger
or in connection with any transaction contemplated hereby or
thereby.

4.23
 Voting
Arrangements. There are no outstanding stockholder agreements, voting trusts,
proxies or other Contracts to which Rose Waste is a party or, to Rose Waste's
Knowledge, to which any other Person is a party, relating to the voting of any
shares of Rose Waste's capital stock.

4.24
 Ownership
of Shares of Itec Capital Stock. With the exception of that certain Itec Warrant
held by George Gitschel, as of the date hereof, neither Rose Waste nor, to Rose
Waste's Knowledge, any of Rose Waste's affiliates or associates (as such terms
are defined under the Securities and Exchange Act of 1934, as amended): (a)
beneficially owns, directly or indirectly; or (b) is party to any Contract for
the purpose of acquiring, holding, voting or disposing of, in each case, shares
of Itec capital stock, except for shares of Itec capital stock in the aggregate
representing less than 1% of the outstanding shares of Itec capital
stock.

4.25
 Accuracy
of Disclosure. None of the certificates or documents to be delivered by Rose
Waste to Itec under this Agreement, taken together, contains or will contain any
untrue statement of a material fact or omits or will omit to state any material
fact necessary in order to make the statements contained herein and therein, in
light of the circumstances under which such statements were made, not
misleading.

4.26 Investment. 

 

(a) Knowledge
of Investment and its Risks. Rose Waste and George Gitschel have knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of their investment in the stock of Itec. Rose Waste and George
Gitschel understand that an investment in Itec represents a high degree of risk
and there is no assurance that the business or operations of Itec will be
successful. Rose Waste and George Gitschel have considered carefully the risks
attendant to an investment in Itec and that, as a consequence of such risks,
Rose Waste and George Gitschel could lose their entire investment in
Itec.

 

(b)
 Investment
Intent. Rose Waste hereby represents and warrants that (i) George Gitschel is
acquiring the Total Exchange Shares for investment for his own account, and not
as a nominee or agent and not with a view to the resale or distribution of all
or any part of the Total Exchange Shares, and George Gitschel has no present
intention of selling, granting any participation in or otherwise distributing
any of the Total Exchange Shares within the meaning of the Securities Act and
(ii) George Gitschel does not have any contracts, understandings, agreements or
arrangements with any person and/or entity to sell, transfer or grant
participations to such person and/or entity, with respect to any of the Total
Exchange Shares.

 

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(c) Disclosure.
Rose Waste and George Gitschel have reviewed information provided by Itec in
connection with the decision to acquire the Total Exchange Shares. Itec has
provided Rose Waste and George Gitschel with all the information that Rose Waste
and George Gitschel have requested in connection with the decision to acquire
the Total Exchange Shares. Rose Waste, on behalf of George Gitschel, further
represents that George Gitschel has had an opportunity to ask questions and
receive answers from Itec regarding the business, properties, prospects and
financial condition of Itec. All such questions have been answered to the full
satisfaction of Rose Waste and George Gitschel.

(d) Accredited
Investor. George Gitschel is an “accredited investor” as that term is defined in
the Securities Act.

5. REPRESENTATIONS
AND WARRANTIES OF ITEC AND MERGER SUB. Itec and Merger Sub hereby represent and
warrant to Rose Waste as follows:

5.1
 Organization
and Good Standing. Itec is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and has the corporate
power and authority to own, operate and lease its properties and to carry on its
business as now conducted and as proposed to be conducted.

5.2
 Power,
Authorization and Validity.

(a)
 Itec has
the right, power, legal capacity and authority to: (i) to carry on its business
as now conducted and as proposed to be conducted; (ii) to own, use and lease its
properties in the manner in which its properties are currently owned, used and
leased and in the manner in which its properties are proposed to be owned, used
and leased; and (iii) enter into and perform its obligations under this
Agreement and all other Merger Agreements to which Itec is or will be a party
that are required to be executed pursuant to this Agreement (collectively with
this Agreement, the "ITEC MERGER AGREEMENTS"). The execution, delivery and
performance of the Itec Merger Agreements have been duly and validly approved
and authorized by Itec's Board of Directors, and as required, by Merger Sub's
Board of Directors.

(b)
 No
filing, authorization or approval, governmental or otherwise, is necessary to
enable Itec to enter into and perform its obligations under the Itec Merger
Agreements, except for: (i) the filing of the Certificate of Merger with the
Delaware and California Secretary of State and the filing of appropriate
documents with the relevant authorities of other states in which Itec is
qualified to do business, if any; (ii) such filings as may be required to comply
with federal and state securities laws; and (iii) such other approvals as of
which Itec has made Rose Waste aware prior to the execution of this
Agreement.

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(c)
 The Itec
Merger Agreements are, or when executed by Itec will be, valid and binding
obligations of Itec enforceable in accordance with their respective terms,
except as to the effect, if any, of: (i) applicable bankruptcy and other similar
laws affecting the rights of creditors generally; (ii) rules of law governing
specific performance, injunctive relief and other equitable remedies; and (iii)
the enforceability of provisions requiring indemnification in connection with
the offering, issuance or sale of securities; provided, however, that the
Certificate of Merger will not be effective until filed with the Delaware and
California Secretary of State.

5.3
 No
Violation of Existing Agreements. Neither the execution and delivery of any of
the Itec Merger Agreements, nor the consummation of the transactions
contemplated hereby, will conflict with, or (with or without notice and/or lapse
of time) result in a termination, breach, impairment or violation of: (a) any
provision of the certificate of incorporation, bylaws or other charter documents
of Itec, as currently in effect; (b) in any material respect, any material
Contract to which Itec is a party or by which Itec is bound; or (c) any federal,
state, local or foreign Order, statute, rule or regulation applicable to Itec or
its assets or properties.

5.4
 Valid
Issuance of Itec's Common Stock. The shares of Itec's Common Stock to be issued
pursuant to the Merger have been duly authorized and reserved for issuance and,
when issued in accordance with the terms of the Merger Agreements, will be
validly issued, fully paid and non-assessable, will not be subject to any
preemptive rights and will be issued in compliance with all applicable federal
or state securities laws pursuant to a valid exemption from registration under
Section 4(2), Rule 506 of Regulation D of the Securities Act. The authorized,
issued and outstanding capitalization of Itec is as set forth in Itec's SEC
Filings as of the dates of the financial statements or other information
included in Itec's SEC Filings.

5.5
 Disclosure.
Itec has made available to Rose Waste an investor disclosure package consisting
of Itec's annual report on Form 10-KSB for its fiscal year ending December 31,
2004 (the "FISCAL YEAR END"), all Forms 10-QSB and 8-K filed by Itec with the
Securities and Exchange Commission since the Fiscal Year End and up to the date
of this Agreement and all proxy materials distributed to Itec's stockholders
since the Fiscal Year End and up to the date of this Agreement (the "ITEC
DISCLOSURE PACKAGE").

5.6
 SEC
Reports. Itec has filed all required forms, reports and documents with the SEC
(collectively, the "SEC REPORTS"), each of which has complied in all material
respects with all applicable requirements of the Securities Act and the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder (the "EXCHANGE ACT"), each as in effect on the date so filed. The
audited consolidated financial statements and unaudited consolidated interim
financial statements of Itec included in its Annual Report on Form 10-KSB and
its Quarterly Reports on Form 10-QSB referred to above, were prepared in
accordance with GAAP consistently applied throughout the periods specified
therein, are correct and complete, and present fairly, in all material respects,
the consolidated financial position and results of operations of Itec for the
periods specified therein, subject in the case of the unaudited consolidated
interim financial statements to an absence of footnotes and to normal year-end
audit adjustments. The Itec Disclosure Package, this Agreement, the exhibits
hereto and any certificates or documents to be delivered to Rose Waste pursuant
to this Agreement, when taken together, do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements contained herein and therein, in light of the circumstances under
which such statements were made, not misleading.

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5.7
 Litigation.
There is no Proceeding pending against Itec and, to Itec's Knowledge, there
currently exists no set of circumstances which Itec believes is likely to result
in any Proceeding nor has any Proceeding been threatened, that, if determined
adversely to the interests of Itec, would have a material adverse effect on
Itec's ability to enter into the Itec Merger Agreements or to effect the Merger
or would have a Material Adverse Effect on Itec.

5.8
 Compliance
with Laws. Itec has complied with, is not in violation of, and has not received
any notices of violations with respect to, any federal, state or local statute,
law or regulation with respect to the conduct of its business, or the ownership
or operation of its business, except for failures to comply or violations which
would not have a Material Adverse Effect on Itec.

5.9
 No
Brokers' Fees. Itec is not obligated for the payment of fees or expenses of any
investment banker, broker, finder or other agent in connection with the origin,
negotiation or execution of this Agreement or the Certificate of Merger or in
connection with any transaction contemplated hereby or thereby.

5.10
 Interim
Operations of Merger Sub. Merger Sub was formed solely for the purpose of
engaging in the transactions contemplated by this Agreement, has engaged in no
other business activities and has conducted its operations only as contemplated
by this Agreement. All of the issued and outstanding shares of Merger Sub
capital stock are held by Itec.

5.11
 Merger
Sub. Merger Sub hereby makes all of the same representations and warranties as
Itec set forth above in this Article 5, except for Sections 5.5 and 5.10, by
substituting "Merger Sub" for "Itec" in the foregoing Article 5
text.

5.12
 Investment
Intent; Access to Information. Itec is acquiring the equity securities of the
Surviving Corporation to be acquired by Itec as a result of the Merger for
Itec's own account and Itec has the present intention of holding such equity
securities for investment purposes and not with a view to, or for sale in
connection with, any public distribution of such equity securities in violation
of any federal or state securities law. Itec has been furnished with or been
given adequate access to information about Rose Waste as it has
requested.

 

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5.13
 Intellectual
Property.

(a)
 As used
herein, the term "INTELLECTUAL PROPERTY RIGHTS" shall mean all worldwide
industrial and intellectual property rights, including, without limitation,
patents, patent applications, patent rights, trademarks, trademark applications,
trade names, service marks, service mark applications, copyright, copyright
applications, franchises, licenses, inventories, know-how, trade secrets,
customer lists, proprietary processes and formulae, all source and object code,
algorithms, architecture, structure, display screens, layouts, inventions,
development tools and all documentation and media constituting, describing or
relating to the above, including, without limitation, manuals, memoranda and
records.

(b)
 Itec owns
or has a written license to, and has the unrestricted right to use, sell and
license, all Intellectual Property Rights material to Itec's business or conduct
of its businesses (such Intellectual Property Rights collectively referred to as
the "ITEC IP RIGHTS") and such rights to use, sell or license are reasonably
sufficient for such conduct of its businesses. No portion of Itec IP Rights is
subject to: (i) any Encumbrance, or (ii) any outstanding Order, stipulation or
Contract restricting in any manner Itec's ability to license or exploit such
Itec IP Rights, except for standard non-exclusive consumer software licenses
granted in the Ordinary Course of Business. There are no royalties, honoraria,
fees or other payments payable by Itec to any Person by reason of the ownership,
use, license, sale or disposition of Itec IP Rights.

(c)
 After the
Closing Date of the Merger, Itec will own or have the unrestricted right to use,
sell, license and dispose of, and otherwise exercise rights with respect to all
Itec IP Rights. The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby will not: (i)
constitute a material breach of any Contract governing any Itec IP Right or (ii)
cause the forfeiture or termination or give rise to a right of forfeiture or
termination of any Itec IP Right or materially impair the right of Itec or Rose
Waste to use, sell or license all or any portion of any Itec IP
Right.

(d)
 Except as
set forth on Section 5.13(e), neither the past, current or intended use of Itec
IP Rights in Itec's business as it has been conducted prior to the Closing, nor
the manufacture, marketing, license, sale or intended use of any product
currently licensed or sold by Itec or currently under development by Itec,
causes Itec to violate any license or Contract between Itec and any third party
or to violate or infringe any Intellectual Property Rights of any other Person.
There is no pending or, to Itec's Knowledge, threatened Order or Proceeding
contesting the validity, ownership or right to use, sell, license or dispose of
any Itec IP Right nor, to Itec's Knowledge, is there any basis for any such
Order or Proceeding. Itec has not received any notice asserting that any Itec IP
Right or the proposed use, sale, license or disposition of a Itec IP Right
conflicts or will conflict with the Intellectual Property Rights or other rights
of any other party, nor, to Itec's Knowledge, is there any basis for any such
assertion. Itec is not wrongfully using any confidential information or trade
secrets of any former employer of any past or present Itec employees. Itec has
not entered into any Contract to indemnify any other Person against any charge
of infringement relating to any Intellectual Property Rights.

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  (e)
 Itec has
taken reasonable and practicable steps designed to safeguard and maintain the
secrecy and confidentiality of, and its proprietary rights in, all Itec IP
Rights. There is no material unauthorized use, infringement or misappropriation
of any Itec IP Right by any third party, including, to the knowledge or Itec,
any Itec employee. All Itec officers, employees and consultants have executed
and delivered to Itec an agreement regarding the protection of proprietary
information and the assignment to Itec of all Intellectual Property Rights
arising from the services performed for Itec by such persons, and Itec has
delivered to Rose Waste copies of all such agreements. No Itec employee or
consultant is in violation of any material term of any employment Contract,
patent disclosure agreement or any other Contract relating to the relationship
of such employee with Itec or any other party (including prior employers)
because of the nature of the business conducted or proposed by Itec. Itec has
provided Rose Waste with a list of all applications, registrations, filings and
other formal actions made or taken pursuant to federal, state and foreign laws
by Itec to perfect or protect its interest in Itec IP Rights, including, without
limitation, all patents, patent applications, trademarks, trademark applications
and service marks. No loss, cancellation, termination or expiration of any such
registration is reasonably foreseeable.

6.
 PRE-CLOSING
PERIOD COVENANTS OF ROSE WASTE. During the period of time from the date of this
Agreement until the Closing Date (the "Pre-Closing Period"), unless such other
time period or date is explicitly specified, Rose Waste covenants and agrees as
follows:

6.1
 Access to
Information.

(a)
 Rose
Waste will provide Itec and its attorneys and accountants with full access
(except with respect to technical trade secrets), at reasonable times and in a
reasonable manner, to all files, books and records of Rose Waste (including
without limitation all existing books, Contracts, leases, licenses, records, tax
returns, work papers and other documents and information related to Rose
Waste).

(b)
 Rose
Waste will provide Itec with copies of such existing books, Contracts, leases,
licenses, records, tax returns, work papers and other documents and information
related to Rose Waste as Itec may reasonably request (with the understanding of
all parties that all such access and investigation shall be and remain subject
to the confidentiality provisions of this Agreement and, to the extent set forth
in Section 3.2, the NDA).

(c)
 Rose
Waste will cause its accountants to cooperate with Itec and its agents in making
available all financial information reasonably requested.

(d)
 Unless
otherwise mutually agreed to, all: (i) communications regarding the Merger; (ii)
requests for additional information; (iii) requests for facility tours or
management meetings; and (iv) discussions or questions regarding procedures,
will be submitted or directed to Gary De Laurentiis.

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6.2
 Advice of
Changes; Duty to Update.

(a)
 Rose
Waste will promptly advise Itec in writing of: (i) the discovery by Rose Waste
of any event, condition, fact or circumstance occurring on or prior to the date
of this Agreement that would render any representation or warranty by Rose Waste
contained in this Agreement untrue or inaccurate in any material respect; (ii)
any event, condition, fact or circumstance occurring subsequent to the date of
this Agreement that would render any representation or warranty by Rose Waste
contained in this Agreement, if made on or as of the date of such event or the
Closing Date, untrue or inaccurate in any material respect; (iii) any breach of
any covenant or obligation of Rose Waste pursuant to this Agreement or any other
Rose Waste Merger Agreements; (iv) any event, condition, fact or circumstance
that may make the timely satisfaction of any of the conditions set forth in
Article 9 impossible or unlikely; and (v) any Material Adverse
Effect.

(b)
 Rose
Waste will promptly update any relevant and material information provided to
Itec after the date of this Agreement pursuant to the terms hereof.

6.3
 Maintenance
of Business.

(a)
 Rose
Waste will use its Best Efforts to conduct its operations exclusively in the
Ordinary Course of Business and in the same manner as such operations have been
conducted prior to the date of this Agreement.

(b)
 Rose
Waste will use its Best Efforts to carry on and preserve intact its current
business organization, keep available the services of its current officers and
employees and maintain its relations and goodwill with all customers, suppliers,
landlords, creditors, licensors, licensees, employees and other Persons having
business relationships with Rose Waste other than those relationships which
would not have a Material Adverse Effect.

(c)
 Rose
Waste will use its Best Efforts to maintain its equipment and other assets in
good working condition and repair according to the standards it has maintained
to the date of this Agreement, subject only to ordinary wear and
tear.

(d)
 Rose
Waste will use its Best Efforts to keep in full force all insurance policies of
Rose Waste and obtain any additional insurance required consistent with past
practices for its business and property.

(e)
 If Rose
Waste becomes aware of a deterioration in the relationship with any customer,
supplier, landlord, creditor, licensor, licensee, employee or other Person which
would have a Material Adverse Effect, it will promptly bring such information to
the attention of Itec in writing and, if requested by Itec, will exert its Best
Efforts to restore the relationship.

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6.4
 Covenants.
Rose Waste will not, without the prior written consent of an officer of Itec,
which consent shall not be unreasonably withheld:

(a)
 form any
subsidiary or acquire any equity interest or other interest in any other
Entity;

(b)
 amend
Rose Waste Certificate of Incorporation, its bylaws or any other charter
document;

(c)
 sell,
issue, grant or authorize the issuance or grant of: (i) any shares of its
capital stock of any class or other security (other than pursuant to the
exercise of currently outstanding options, warrants or conversion of Preferred
Stock); (ii) any option, call, warrant, obligation, subscription, option or
right to acquire any capital stock or any other security, except for New
Options; or (iii) any instrument convertible into or exchangeable for any
capital stock or other security;

(d)
 declare,
set aside or pay any dividend on, or make any other distribution in respect of,
Rose Waste's capital stock;

(e)
 effect
any split, combination or recapitalization of Rose Waste's capital stock or any
direct or indirect redemption, purchase or other acquisition of Rose Waste's
capital stock (other than pursuant to repurchase upon an employee's termination
of employment), or effect or be a party to any transaction relating to a
recapitalization, reclassification of shares, stock split, reverse stock split
or similar transaction;

(f)
 merge,
consolidate, acquire or otherwise reorganize with any entity other than Merger
Sub or Itec, or accept or enter into any Acquisition Proposal;

(g)
 sell,
give away or otherwise transfer or dispose, or lease or license any Rose Waste
asset, including without limitation placing any Rose Waste IP Right in the
public domain or otherwise disposing of or transferring any Rose Waste IP Right
or licensing the source code of any Rose Waste IP Right, to any other Person,
except for products sold (subject to the $10,000 limit in Section 4.11(a)(v))
and Rose Waste IP Rights licensed by Rose Waste in the Ordinary Course of
Business;

(h)
 pledge or
hypothecate any of its assets or otherwise permit any of its assets to become
subject to any Encumbrance, except in the Ordinary Course of Business and
subject to the $10,000 limit in Section 4.11(a)(v);

(i)
 make any
capital expenditures, except for such capital expenditures as in the aggregate,
measured by invoice amount, do not exceed $10,000 or were consented to by Itec
in writing;

34

(j)
 enter
into any material lease or Contract for the purchase or sale of any property,
real or personal, except in the Ordinary Course of Business consistent with past
practice;

(k)
 borrow
any money other than in the Ordinary Course of Business, but in any event not
exceeding $10,000;

(l)
 make any
loan or advance to any other Person, including without limitation any Rose Waste
Stockholder, officer or director (except for normal employee travel advances in
the Ordinary Course of Business);

(m)
 guarantee
or act as a surety for any obligation except for the endorsement of checks and
other negotiable instruments in the Ordinary Course of Business, consistent with
past practice, which are not material in amount;

(n)
 establish,
amend or adopt any Rose Waste Employee Plan or Rose Waste Benefit Arrangement
(defined in Sections 4.18(d)-(e)), pay any bonus, make any profit sharing or
similar payment, increase the amount of the wages, salary, commissions, fringe
benefits or other compensation or remuneration payable, or grant any severance
or termination pay to any of its directors, officers or employees, other than as
required under agreements existing on the date of this Agreement; or enter into
any new employment or consulting agreement with any such person;

(o)
 write off
as uncollectable, or establish any extraordinary reserve with respect to, any
account receivable or other indebtedness, except in the Ordinary Course of
Business;

(p)
 forgive
any debt or Encumbrance or otherwise release or waive any right or claim, in any
case, involving over $1,000;

(q)
 amend or
terminate any Contract or license to which it is a party except those amended or
terminated in the Ordinary Course of Business which are not material in amount
or effect;

(r)
 terminate
any of its Key Employees or management;

(s)
 change
any of its methods of accounting or accounting practices in any respect (other
than as required by GAAP);

(t)
 agree to
any audit assessment by any tax authority or file any federal or state income or
franchise tax return unless copies of such returns have been delivered to Itec
for its review prior to filing;

(u)
 commence
any litigation or dispute resolution process involving over
$10,000;

35

(v)
 take any
action that would be reasonably likely to interfere with the tax-free
reorganization status of the Merger;

(w)
 enter
into any transaction or take any other action outside the Ordinary Course of
Business; or

(x)
 agree,
commit or enter into any Contract to do any of the things described in the
preceding Sections 6.4(a) through 6.4(w).

6.5
 Rose
Waste Stockholders' Approval. As promptly as practicable after the Execution
Date and prior to the Effective Time, Rose Waste with the cooperation of Itec
will obtain approval of Rose Waste Stockholders for this Agreement and the
Merger, which approval has been recommended by Rose Waste's Board of Directors
and management.

6.6
 Regulatory
Approvals. Rose Waste will execute and file, or join in the execution and
filing, of any application or other document that may be necessary in order to
obtain the authorization, approval or consent of any governmental body, federal,
state, local or foreign which may be reasonably required, or which Itec may
reasonably request, in connection with the consummation of the transactions
contemplated by this Agreement. Rose Waste will use its Best Efforts to obtain
all such authorizations, approvals and consents.

6.7
 Necessary
Consents. Rose Waste will use its Best Efforts to obtain such written consents
and take such other actions as may be necessary or appropriate in addition to
those set forth in Sections 6.5 and 6.6 to allow the consummation of the
transactions contemplated by this Agreement and to allow Itec to carry on Rose
Waste's business after the Closing Date.

6.8
 Litigation.
Rose Waste will notify Itec in writing promptly after learning of any material
Proceedings by or before any court, board or governmental agency, initiated by
or against Rose Waste, or known by Rose Waste to be threatened against it. If
Rose Waste becomes subject to a review by the Internal Revenue Service or any
other taxing agency or authority for accounting periods prior to the Closing
Date (including but not limited to any short tax year resulting from the
Merger), then Rose Waste acknowledges that Itec will be entitled to participate
in such review and that Rose Waste shall be responsible for payment of any
assessment. Rose Waste will not enter into any settlement or other stipulation
with respect to any such review without the written consent of Itec, which
consent will not be unreasonably withheld.

6.9
 No Other
Negotiations.

(a)
 From the
date of this Agreement until the earlier of the Closing Date or termination of
this Agreement pursuant to its terms, Rose Waste shall not (nor will Rose Waste
permit any of its officers directors, stockholders, agents, representatives or
affiliates to), directly or indirectly: (i) solicit, initiate, entertain,
encourage or induce the making, submission or announcement of, any Acquisition
Proposal by any Person other than Itec, or (ii) participate in any discussions
or negotiations with, or disclose any non-public information concerning Rose
Waste to, or afford any access to the properties, books or records of Rose Waste
to, or otherwise assist or facilitate, or enter into any agreement or
understanding with, any Person other than Itec, in connection with any
Acquisition Proposal with respect to Rose Waste. Rose Waste will not, and will
instruct each of its representatives not to, directly or indirectly, make or
authorize any public statement, recommendation or solicitation in support of any
Acquisition Proposal by any Person other than Itec. Rose Waste shall immediately
cease and cause to be terminated any such contacts or negotiations with third
parties relating to any such transaction or proposed transaction. Without
limiting the generality of the foregoing, any violation of any of the
restrictions set forth in the preceding sentence by any representative of Rose
Waste shall be deemed to constitute a breach of this Section 6.9 by Rose
Waste.

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(b)
 Rose
Waste will notify Itec as promptly as practicable if it receives any proposal or
written inquiry or written request for Rose Waste in connection with an
Acquisition Proposal or potential Acquisition Proposal and, as promptly as
practicable, notify Itec of the significant terms and conditions of any such
Acquisition Proposal, as well as the identity of the third party submitting such
Acquisition Proposal.

6.10
 No
Solicitation of Employees. In the event of Termination of this Agreement, Rose
Waste will not directly or indirectly: (a) initiate or maintain contact (except
for contacts made in the Ordinary Course of Business) with any officer, director
or employee of Itec regarding its business, operations, prospects or finances,
or (b) solicit or offer to hire any employee of Itec or persuade any employee of
Itec to terminate his or her employment before May 30, 2006.

6.11
 Rose
Waste Dissenting Stockholders. As promptly as practicable after Rose Waste
Stockholders' Meeting and prior to the Closing Date, Rose Waste shall furnish
Itec with the name and address of each holder of Dissenting Shares, if any, and
the number of Dissenting Shares owned by such holder.

6.12
 Stockholder's
Questionnaire and Other Securities Laws Compliance.

(a)
 Rose
Waste will shall appoint a "purchaser's representative" (as defined by Rule
501(h) of the Securities Act) and take any other actions necessary to help
qualify the issuance of the Exchange Shares as a "private placement" under
Regulation D and/or Section 4(2) of the Securities Act. Any out-of-pocket costs
of such purchaser's representative shall be borne equally by Itec on one hand
and Rose Waste Stockholders on the other.

(b)
 Rose
Waste will use its Best Efforts to cause each Rose Waste Stockholder to execute
and deliver to Itec an Investor Questionnaire (the "ROSE WASTE STOCKHOLDER'S
QUESTIONNAIRE").

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6.13
 Blue Sky
Laws. Rose Waste shall use its Best Efforts to assist Itec to the extent
necessary to comply with the securities and Blue Sky laws of all jurisdictions
which are applicable in connection with the Merger.

6.14
 Tax Free
Reorganization. Rose Waste will cooperate with the other parties and take all
reasonable actions as may be necessary to ensure that this Agreement involves a
tax-free plan of reorganization and that the Merger is consummated in accordance
with the provisions of Section 368(a)(1)(A) and Section 368(a)(2)(E) of the
Code.

6.15
 Best
Efforts. Rose Waste will use its Best Efforts to cause the transactions
contemplated by this Agreement to be consummated, and, without limiting the
generality of the foregoing, to obtain all consents and authorizations of third
parties and to make all filings with, and give all notices to, third parties
that may be necessary or reasonably required on its part in order to effect the
transactions contemplated hereby.

7.
 PRE-CLOSING
PERIOD COVENANTS OF ITEC. During the Pre-Closing Period, unless such other time
period or date is explicitly specified, Itec covenants and agrees as
follows:

7.1
 Access to
Information. Itec shall permit Rose Waste and its attorneys and accountants to
conduct due diligence to the extent that is customary for private companies that
are acquired by public companies. Unless otherwise mutually agreed to, all: (a)
communications regarding the Merger; (b) requests for additional information;
(c) requests for facility tours or management meetings; and (d) discussions or
questions regarding procedures, will be submitted or directed to Gary De
Laurentiis.

7.2
 Advice of
Changes; Duty to Update.

(a)
 Itec will
promptly advise Rose Waste in writing of: (i) the discovery by Itec of any
event, condition, fact or circumstance occurring on or prior to the date of this
Agreement that would render any representation or warranty by Itec contained in
this Agreement untrue or inaccurate in any material respect; (ii) any event,
condition, fact or circumstance occurring subsequent to the date of this
Agreement that would render any representation or warranty by Itec contained in
this Agreement, if made on or as of the date of such event or the Closing Date,
untrue or inaccurate in any material respect; (iii) any breach of any covenant
or obligation of Itec pursuant to this Agreement or any other Itec Merger
Agreements; (iv) any event, condition, fact or circumstance that may make the
timely satisfaction of any of the conditions set forth in Article 8 impossible
or unlikely; and (v) any Material Adverse Effect.

(b)
 Itec will
promptly update any relevant and material information provided to Rose Waste
after the date hereof pursuant to the terms of this Agreement. Itec will furnish
to Rose Waste, promptly after filed with the SEC, any reports filed with the SEC
during the Pre-Closing Period.

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7.3
 Conduct
of Business. Itec will use its Best Efforts to preserve its business without
material impairment.

7.4
 Regulatory
Approvals. Itec will execute and file, or join in the execution and filing, of
any application or other document that may be necessary in order to obtain the
authorization, approval or consent of any governmental body, federal, state,
local or foreign, which may be reasonably required, or which Rose Waste may
reasonably request, in connection with the consummation of the transactions
contemplated by this Agreement. Itec will use its Best Efforts to obtain all
such authorizations, approvals and consents.

7.5
 Necessary
Consents. Itec will use its Best Efforts to obtain such written consents and
take such other actions as may be necessary or appropriate in addition to those
set forth in Section 7.4 to allow the consummation of the transactions
contemplated hereby and to allow Itec to carry on Rose Waste's business after
the Closing.

7.6
 No
Solicitation of Employees. In the event of Termination of this Agreement, Itec
will not directly or indirectly: (a) initiate or maintain contact (except for
contacts made in the Ordinary Course of Business) with any officer, director or
employee of Rose Waste regarding its business, operations, prospects or
finances, or (b) solicit or offer to hire any employee of Rose Waste or persuade
any employee of Rose Waste to terminate his or her employment. An employment
advertisement that is placed in a national or regional publication and is
directed at members of the public generally shall not constitute a breach of
clause "(b)" in the preceding sentence.

7.7
 Blue Sky
Laws. Itec shall take such steps as may be necessary to comply with the
securities and Blue Sky laws of all jurisdictions which are applicable in
connection with the Merger; provided, however, that Itec shall not be required
to qualify to do business or execute a general consent to service of process in
any jurisdiction.

7.8
 Tax Free
Reorganization. Itec will cooperate with the other parties and take all
reasonable actions as may be necessary to ensure that this Agreement involves a
tax-free plan of reorganization and that the Merger is consummated in accordance
with the provisions of Section 368(a)(1)(A) and Section 368(a)(2)(E) of the
Code.

7.9
 Best
Efforts. Itec will use its Best Efforts to satisfy or cause to be satisfied all
the conditions precedent which are set forth in Article 8. Itec will use its
Best Efforts to cause the transactions contemplated by this Agreement to be
consummated.

8.
 CONDITIONS
TO OBLIGATIONS OF ROSE WASTE. Rose Waste's obligations to consummate the Merger
and to take the other actions contemplated in this Agreement are subject to the
fulfillment or satisfaction, at or prior to the Closing, of each of the
following conditions (any one or more of which may be individually waived by
Rose Waste, but only in a writing signed by Rose Waste):

39

8.1
 Accuracy
of Representations and Warranties. The representations and warranties of Itec
and Merger Sub set forth in Article 5 shall be true and accurate in every
material respect (other than to the extent any such change is a result of the
Merger) on and as of the Closing Date with the same force and effect as if they
had been made at the Closing (except for reps made as of a date certain), and
Rose Waste shall have received a certificate to such effect executed by an
officer of each of Itec and Merger Sub on behalf of each of Itec and Merger
Sub.

8.2
 Covenants.
Itec shall have performed and complied in all material respects with all of its
covenants contained in Article 7 at or prior to the Closing, and Rose Waste
shall have received a certificate to such effect executed by an officer of Itec
on behalf of Itec.

8.3
 Compliance
with Law. There shall be no Order or threat of an Order, or any other fact or
circumstance, which would prohibit or render illegal the transactions
contemplated by this Agreement.

8.4
 No
Material Adverse Change. Itec shall not have experienced any Material Adverse
Change, other than to the extent that any such change is a result of the
proposed Merger. For the purpose of this Section 8.4, a decline in the market
price of Itec's common stock will not in and of itself constitute a Material
Adverse Change. Rose Waste shall have received a certificate to the effect that
no Material Adverse Change has occurred, executed by an officer of Itec on
behalf of Itec.

8.5
 Government
Consents. There shall have been obtained at or prior to the Closing Date such
permits or authorizations, and there shall have been taken such other action, as
may be required to consummate the Merger by any regulatory authority having
jurisdiction over the parties and the actions herein proposed to be taken,
including but not limited to requirements under applicable federal and state
securities laws.

8.6
 Consents.
Rose Waste shall have received duly executed copies of all material third-party
consents and approvals contemplated by this Agreement for Rose Waste to
consummate the transactions contemplated by this Agreement in form and substance
reasonably satisfactory to Rose Waste, except for such consents and approvals as
Itec shall have agreed shall not be obtained.

8.7
 Documents.
Rose Waste shall have received all written consents, assignments, waivers,
authorizations or other certificates reasonably deemed necessary by Rose Waste
or Rose Waste's legal counsel for Rose Waste to consummate the transactions
contemplated hereby.

8.8
 Rose
Waste Stockholder Approval. Rose Waste's Stockholders shall have approved and
adopted this Agreement and the Merger by a favorable vote of the requisite
percentage of shares of outstanding capital stock of Rose Waste entitled to vote
on this Agreement and the Merger by written consent, which complied in all
respects with Rose Waste Certificate of Incorporation, Rose Waste's bylaws and
other charter documents and all applicable law.

40

8.9
 Legal
Opinion. Rose Waste shall have received an opinion of Itec's counsel, The Otto
Law Group, PLLC, in form reasonably satisfactory to Rose Waste and its counsel
and dated as of the Closing Date. In rendering such opinion, The Otto Law Group,
PLLC shall be entitled to rely upon representations of officers of Itec, Merger
Sub and Rose Waste and in the Merger Agreements. 

8.10 Mr.
George Gitschel’s Employment Agreement. George Gitschel shall have executed an
Employment Agreement which shall be agreeable to both Itec and Mr.
Gitschel.

8.11 Pledge
Agreement and Letter Agreement. George Gitschel and Itec shall have executed and
delivered (a) the Pledge Agreement and (b) a Letter Agreement acceptable to them
in their absolute discretion regarding Itec’s obligations (i) to maintain George
Gitschel as a director and officer of Itec and the Surviving Corporation (ii) to
support financially, operationally and administratively the Surviving
Corporation as a separate entity, (iii) to permit Rose Waste to pay or
distribute to George Gitschel as and when he elects Rose Waste cash equal
to any unpaid profit of Rose Waste as of the Closing Date, and (iv) to permit
Rose Waste to sell at cost to George Gitschel certain investments in other
companies made by Rose Waste and not germane to its business (“Letter
Agreement”).

8.12 Adoption
of New Itec Option Plan. Itec shall have adopted the New Itec Option Plan which
shall be agreeable to both Itec and Mr. Gitschel.

8.13 Due
Diligence Review. Mr. George Gitschel shall be satisfied, in his sole and
absolute discretion, with his due diligence review (including that of his
professional advisors) of Itec including, but not limited to, their examination
of the balance sheets, the patents licensed by Itec and the agreements relating
thereto and the tax returns of Itec.

8.14 Executive
Officer and Director Appointments. Mr. George Gitschel shall have been appointed
the Vice President of Business Development and to the Board of Directors of Itec
and the Surviving Corporation.

9.
 CONDITIONS
TO OBLIGATIONS OF ITEC. Itec's obligations to consummate the Merger and to take
the other actions contemplated in this Agreement are subject to the fulfillment
or satisfaction, at or prior to the Closing, of each of the following conditions
(any one or more of which may be individually waived by Itec, but only in a
writing signed by Itec):

9.1
 Accuracy
of Representations and Warranties. The representations and warranties by Rose
Waste set forth in Article 4 shall be true and accurate in every material
respect on and as of the Closing with the same force and effect as if they had
been made at the Closing (except for representations that are made as of a date
certain), and Itec shall have received a certificate to such effect executed by
the President and Secretary of Rose Waste on behalf of Rose Waste.

41

9.2
 Covenants.
Rose Waste shall have performed and complied in all material respects with all
of the covenants contained in Article 6 at or prior to the Closing, and Itec
shall have received a certificate to such effect executed by the President and
Secretary of Rose Waste on behalf of Rose Waste.

9.3
 Compliance
with Law. There shall be no Order or threat of an Order, or any other fact or
circumstance, which would prohibit or render illegal the transactions
contemplated by this Agreement.

9.4
 No
Material Adverse Change. Rose Waste shall not have experienced any Material
Adverse Change, other than to the extent that any such change is a result of the
proposed Merger. Itec shall have received a certificate to such effect executed
by the President and Secretary of Rose Waste on behalf of Rose
Waste.

9.5
 Government
Consents. There shall have been obtained at or prior to the Closing such permits
or authorizations, and there shall have been taken such other action, as may be
required to consummate the Merger by any regulatory authority having
jurisdiction over the parties and the actions herein proposed to be taken,
including but not limited to requirements under applicable federal and state
securities laws.

9.6
 Third-Party
Consents; Assignments. Itec shall have received duly executed copies of all
material third-party consents, approvals, assignments, waivers, authorizations
or other certificates contemplated by this Agreement or reasonably deemed
necessary by Itec's legal counsel to provide for the continuation in full force
and effect of any and all Material Contracts and leases of Rose Waste and for
Itec to consummate the transactions contemplated hereby in form and substance
reasonably satisfactory to Itec.

9.7
 No
Litigation. No litigation or Proceeding shall be threatened or pending for the
purpose or with the probable effect of enjoining or preventing the consummation
of any of the transactions contemplated by this Agreement, or which would be
reasonably expected to have a Material Adverse Effect.

9.8
 Termination
of Rights. Any registration rights (other than those set forth in the Rights
Agreement), rights of refusal, rights to any liquidation preference, or
redemption rights of any Rose Waste Stockholder shall have been terminated or
waived as of the Closing Date.

9.9
 Due
Diligence Review. Itec shall be satisfied, in its sole and absolute discretion,
with its due diligence review (including that of its professional advisors) of
Rose Waste.

9.10
 Rose
Waste Stockholder Approval. Itec shall have received a copy of a resolution,
certified by the Secretary of Rose Waste, to the effect that Rose Waste's
Stockholders have approved and adopted this Agreement and the Merger by a
favorable vote of the requisite percentage of shares of outstanding capital
stock of Rose Waste entitled to vote on this Agreement and the Merger by written
consent, which vote complied in all respects with Rose Waste Certificate of
Incorporation, Rose Waste's bylaws and other charter documents and all
applicable law.

42

9.11
 Purposely
Left Blank

9.12
 Rose
Waste Stockholder's Questionnaires. Itec shall have received Rose Waste
Stockholder's Questionnaires from holders of all of the then-outstanding Total
Exchange Shares.

9.13
 Legal
Opinions. Itec shall have received an opinion of Rose Waste's counsel, Epstein,
Englert, Staley & Coffey, Professional Corporation, reasonably satisfactory
to Itec and its counsel dated as of the Closing Date. In rendering such
opinions, Epstein, Englert, Staley & Coffey, Professional Corporation shall
be entitled to rely upon representations of officers of Itec, Merger Sub and
Rose Waste.

10.
 TERMINATION
OF AGREEMENT AND CONTINUING OBLIGATIONS

10.1
 Right to
Terminate.

(a)
 Voluntary
Termination. This Agreement may be terminated by Itec and/or Rose Waste and the
Merger abandoned at any time prior to the Closing, whether before or after
approval by Rose Waste Stockholders:

    (i)
 by the
mutual written consent of both parties;

    (ii)
 by either
party, if such party (including its stockholders) is not in material breach of
any representation, warranty, covenant or agreement contained in this Agreement,
and such other party is in material breach of any representation, warranty,
covenant or agreement contained in this Agreement and such breaching party fails
to cure such material breach within fifteen (15) days of written notice of such
material breach from the non-breaching party;

    (iii)
 by either
party, if any of the conditions precedent to such party's obligations set forth
in Article 8 (if Rose Waste) or Article 9 (if Itec) have not been fulfilled or
waived at and as of the Closing; or

    (iv)
 by either
party, if there is a final nonappealable Order of a federal or state court in
effect preventing consummation of the Merger, or if any statute, rule,
regulation or Order is enacted, promulgated or issued or deemed applicable to
the Merger by any governmental body that would make consummation of the Merger
illegal.

(b)
 Automatic
Termination. Unless otherwise agreed by Itec and Rose Waste, this Agreement will
automatically terminate if all conditions to the Closing have not been satisfied
or waived on or before one hundred and fifty (150) days after the Effective
Time; provided, however, that the right to terminate this Agreement under this
Section 10.1 shall not be available to any party if such party (or its
stockholders') breach of any representation, warranty, covenant or agreement
contained in this Agreement has been the cause of or resulted in the failure of
the Closing to occur on or before such date.

43

10.2
 Termination
Procedures. If either party wishes to terminate this Agreement pursuant to
Section 10.1, such party shall deliver to the other party a written notice
stating that such party is terminating this Agreement and setting forth a brief
description of the basis of such termination. Termination of this Agreement will
be effective upon the delivery of such notice.

10.3
 Continuing
Obligations. Following any termination of this Agreement pursuant to this
Article 10, the parties to this Agreement will continue to be liable for
breaches of this Agreement prior to such termination and will continue to
perform their respective obligations under Sections 3.2, 6.10, 7.6 and 12.2.
Except for the continuing obligations set forth in the preceding sentence, the
parties to this Agreement will be without any further obligation or Liability
upon any party in favor of the other party. However, nothing in this Section
10.3 will limit the obligations of each party to use its Best Efforts to cause
the Merger to be consummated, as set forth in Sections 6.15 and
7.9.

10.4
 Itec
shall comply with the reporting requirements of Section 13 and 15(d) of the
Exchange Act and shall comply with all other public information reporting
requirements of the SEC (including Rule 144 promulgated by the Commission under
the Securities Act) from time to time in effect and relating to the availability
of an exemption from the Securities Act for the sale of any Exchange Shares.
Itec shall also cooperate with each holder of any Exchange Shares in supplying
such information as may be necessary for such holder to complete and file any
information reporting forms presently or hereafter required by the SEC as a
condition to the availability of a Rule 144 exemption from the Securities Act
for the sale of any Exchange Shares.

10.5
 Directors
and Officers Indemnification. From and after the Effective Time, Itec and
Surviving Corporation shall indemnify, defend and hold harmless each person who
is now or has been at any time prior to the date hereof, an officer or director
of Rose Waste (collectively, the "D&O GROUP") to the same extent that such
officer or director is indemnified by Rose Waste pursuant to Rose Waste's
charter and by-laws, as in effect on the date hereof, for acts or omissions in
such person's capacity as an officer or director of Rose Waste occurring on or
prior to the Effective Time, provided that (i) the D&O Group may retain only
one law firm to represent them with respect to any single action, which firm
shall be reasonably satisfactory to Itec and Surviving Corporation, unless there
is, under applicable standards of professional conduct, conflict on any
significant issue between the positions of any two or more members of the
D&O Group, (ii) Itec and Surviving Corporation shall pay the reasonable fees
and expenses of such counsel and (iii) Itec and Surviving Corporation shall not
be liable for any settlement effected without their written
consent.

 

44

11. POST-CLOSING
COVENANTS OF ITEC

11.1 Financing.
Itec shall have received (i) no less than $3,000,000 pursuant to the offering of
its securities, and (ii) the $2,000,000 loan from the CIWMB of the State of
California (the “Financing”) within the one hundred and fifty (150) day period
following the Effective Time provided for such in Section 11.2(iii). Itec shall
use its reasonable best efforts to secure the Financing.

11.2 Rescission.
In the event (i) of a Bankruptcy (defined below), (ii) the terms of George
Gitschel’s Employment Agreement with Itec, the Pledge Agreement or the Letter
Agreement are violated, or (iii) the Financing is not completed on or before one
hundred and fifty (150) days after the Effective Time, George Gitschel shall
have the right to return the Total Exchange Shares in exchange for all of the
Rose Waste Common Stock as provided in the Pledge Agreement, thereby regaining
control of Rose Waste.

(a) A
“Bankruptcy” shall be deemed to have occurred if Itec, (i) is the subject of an
order for relief under Title 11 of the United States Code, or any successor
statute or other statute in any foreign jurisdiction having like import of
effect, as such term is defined in the Act; (ii) is the subject of an entry of a
decree or order for relief by a court of competent jurisdiction in any
involuntary case brought against Itec under any bankruptcy, insolvency or other
similar law generally affecting the rights of creditors and relief of debtors
now or hereafter in effect (collectively, “Debtor Relief Laws”); (iii) is the
subject of an appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator or other similar agent under applicable Debtor Relief Laws
for Itec or for any substantial part of its assets or property; (iv) is ordered
to wind up or liquidate their affairs; (v) is the subject of the filing of a
petition in any involuntary bankruptcy case, which petition remains not
dismissed for a period of 180 days or which is not dismissed or suspended
pursuant to Section 305 of the Federal Bankruptcy Code (or any corresponding
provision of any future United States bankruptcy law); (vi) commences a
voluntary case under any applicable Debtor Relief Law now or hereafter in
effect; (vii) consents to the entry of an order for relief in an involuntary
case under any such law or to the appointment of or the taking or possession by
a receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar agent under any applicable Debtor Relief Laws for such Person or for any
substantial part of its assets or property; or (viii) makes any general
assignment for the benefit of its creditors.

11.3 Plastic
Material Purchased by Itec through Rose Waste. Any plastic material purchased by
Itec through Rose Waste shall be recorded on the books of Rose Waste and a
commission therefore shall be paid to Mr. Gitschel as provided in Mr. Gitschel’s
Employment Agreement.

45

12. POST-CLOSING
COVENANTS OF ROSE WASTE

12.1 Release
of Rose Waste Common Stock to Itec. Upon receipt by Itec of the Financing, the
Escrow Agent shall release the Rose Waste Common Stock to Itec, subject to and
in accordance with the Pledge Agreement and all other terms and conditions of
the Merger Agreements.

12.2 George
Gitschel and Rose Waste shall use their reasonable best efforts in cooperating
with Itec with regards to securing the Financing.

13.
 SURVIVAL
OF REPRESENTATIONS, INDEMNIFICATION AND REMEDIES

13.1
 Survival
of Representations. All representations, warranties, covenants and agreements of
Itec and Merger Sub contained in this Agreement will remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
the parties to this Agreement, until the earlier of the termination of this
Agreement or three (3) years after the Closing Date, whereupon such
representations, warranties, covenants and agreements will expire (except for
covenants that by their terms survive for a longer period). All representations,
warranties, covenants and agreements of Rose Waste contained in this Agreement
will remain operative and in full force and effect from the date of this
Agreement until the earlier of the termination of this Agreement or three (3)
years after the Closing Date, whereupon such representations, warranties,
covenants and agreements will expire (except for provisions that by their terms
survive for a longer period).

13.2
 Agreement
by Rose Waste and Rose Waste Stockholders to Indemnify. Subject to the
limitations set forth in this Article 13, Rose Waste and each of Rose Waste
Stockholders, severally but not jointly, hereby agree to indemnify and hold
harmless Itec and its officers, directors, agents and employees, and each
person, if any, who controls or may control Itec within the meaning of the
Securities Act from and against any and all claims, demands, actions, causes of
actions, losses, costs, damages, liabilities and expenses including, without
limitation, reasonable legal fees, reduced by any recovery under policies of
insurance ("ROSE WASTE DAMAGES"):

(a)
 arising
out of any misrepresentation or breach of or default in connection with any of
the representations, warranties, covenants and agreements given or made by Rose
Waste or Rose Waste Stockholder in this Agreement or any agreement, certificate,
document or instrument delivered by or on behalf of Rose Waste pursuant to this
Agreement;

(b)
 resulting
from any failure of any Rose Waste Stockholder: (i) to have good, valid and
marketable title to the issued and outstanding Rose Waste Common Stock held by
such stockholder, free and clear of Encumbrances other than Permitted
Encumbrances, or (ii) to have full right, capacity and authority to vote such
Rose Waste Common Stock in favor of the Merger and the other transactions
contemplated by the Certificate of Merger;

46

13.3
 Agreement
by Itec to Indemnify. Subject to the limitations set forth in this Article 11,
Itec hereby indemnify and hold harmless Rose Waste and its officers, directors,
agents and each of Rose Waste Stockholders and employees, and each person, if
any, who controls or may control Rose Waste or any Rose Waste Stockholder within
the meaning of the Securities Act from and against any and all claims, demands,
actions, causes of actions, losses, costs, damages, liabilities and expenses
including, without limitation, reasonable legal fees, reduced by any recovery
under policies of insurance arising out of any misrepresentation or breach of or
default in connection with any of the representations, warranties, covenants and
agreements given or made by Itec or Merger Sub in this Agreement or any
agreement certificate, document or instrument delivered by or on behalf of Itec
or Merger Sub pursuant to this Agreement or in connection with the New Itec
Option Plan (except for claims, demands, actions, causes of actions, losses,
costs, damages, liabilities and expenses related to the valid approval thereof)
("ITEC DAMAGES" and together with Rose Waste Damages, "DAMAGES").

13.4
 No
Additional Representations. Neither Rose Waste nor Itec or Merger Sub has made
and is not making any representation, warranty, covenant or agreement, express
or implied, with respect to the matters contained in this Agreement or the other
Merger Agreements other than the explicit representations, warranties, covenants
and agreements set forth herein or therein. Each Indemnifying Party acknowledge
and agrees that it will not assert, except pursuant to Article 11, any claim
against Itec Merger Sub, Rose Waste or Rose Waste Stockholders or any of their
respective partners, directors,

officers,
employees, agents, stockholders, consultants, representatives, controlling
persons or an Affiliate of any of the foregoing, or any such persons liable for
any inaccuracies, misstatements or omissions with respect to information
furnished by such persons. Upon making any payment to an Indemnitee for any
indemnification claim, the Indemnifying Party shall be subrogated, to the extent
of such payment, to any rights which the Indemnitee may have against other
persons (other than another Indemnitee) with respect to the subject matter
underlying such indemnification claim. Each party shall take all reasonable
steps to mitigate all Damages upon and after becoming aware of any event which
could reasonably be expected to give rise to any Damages with respect to which
indemnification may be requested hereunder.

14.
 MISCELLANEOUS

14.1
 Entire
Agreement. The Merger Agreements and the exhibits to this Agreement constitute
the entire understanding and agreement of the parties to this Agreement with
respect to the subject matter hereof and supersede all prior and contemporaneous
agreements or understandings, inducements or conditions, express or implied,
written or oral, between the parties with respect to the subject matter hereof.
The express terms hereof control and supersede any course of performance or
usage of the trade inconsistent with any of the terms hereof.

47

14.2
 Assignment;
Binding Upon Successors and Assigns. No party to this Agreement may assign any
of its rights or obligations hereunder without the prior written consent of the
other party hereto. This Agreement will be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted
assigns.

14.3
 No Third
Party Beneficiaries. No provisions of this Agreement are intended, nor will be
interpreted, to provide or create any third party beneficiary rights or any
other rights of any kind in any client, customer, affiliate, stockholder,
partner, employee or any party hereto or any other Person unless specifically
provided otherwise herein (including without limitation Section 10.5 hereof),
and, except as so provided, all provisions hereof will be personal solely
between the parties to this Agreement.

14.4
 Construction
of Agreement. This Agreement has been negotiated by the respective parties
hereto and their attorneys and have been reviewed by each party hereto.
Accordingly, no ambiguity in the language of this Agreement will be construed
for or against either party.

14.5
 Section
Headings. A reference to a section, article or exhibit will mean a section in,
article in or exhibit to this Agreement unless otherwise explicitly set forth.
The titles and headings herein are for reference purposes only and will not in
any manner limit the construction of this Agreement, which will be considered as
a whole.

14.6
 No Joint
Venture. Nothing contained in this Agreement will be deemed or construed as
creating a joint venture or partnership between any of the parties hereto.
Except as explicitly specified herein, no party is by virtue of this Agreement
authorized as an agent, employee or legal representative of any other party.
Except as explicitly specified herein, no party will have the power to control
the activities and operations of any other and their status is, and at all
times, will continue to be, that of independent contractors with respect to each
other. Except as explicitly specified herein, no party will have any power or
authority to bind or commit any other. No party will hold itself out as having
any authority or relationship in contravention of this Section
14.6.

14.7
 Time of
the Essence. Time is of the essence in the performance of each of the terms
hereof with respect to the obligations and rights of each party
hereto.

14.8
 Amendment,
Extension and Waivers. At any time prior to the Closing Date, Itec, Merger Sub
and Rose Waste may, to the extent legally allowed: (a) extend the time for
performance of any of the obligations of the other party; (b) waive any
inaccuracies in the representations and warranties made to such party contained
herein or in any document delivered pursuant thereto; and (iii) waive compliance
with any of the agreements, covenants or conditions for the benefit of such
party contained herein. Any term or provision of this Agreement may be amended.
Any agreement to any amendment, extension or waiver will be valid only if set
forth in writing and signed by the party to be bound. The waiver by a party of
any breach hereof or default in the performance hereof will not be deemed to
constitute a waiver of any other default or any

succeeding
breach or default. The failure of any party to enforce any of the provisions
hereof will not be construed to be a waiver of the right of such party
thereafter to enforce such provisions. The Agreement may be amended by the
parties hereto at any time before or after approval of Rose Waste Stockholders,
but, after such approval, no amendment will be made which by applicable law
requires the further approval of Rose Waste Stockholders without obtaining such
further approval.

48

14.9
 Severability.
If any provision of this Agreement or its application will for any reason and to
any extent be invalid or unenforceable, the remainder of this Agreement and
application of such provision to other persons or circumstances will be
interpreted so as reasonably to effect the intent of the parties hereto. The
parties will replace such void or unenforceable provision of this Agreement with
a valid and enforceable provision that will achieve, to the extent possible, the
economic, business and other purposes of the void or unenforceable
provision.

14.10
 Governing
Law. The validity of this Agreement the construction of its terms, and the
interpretation and enforcement of the rights and duties of the parties of this
Agreement will be exclusively governed by and construed in accordance with the
internal laws of the State of California, as applied to agreements entered into
solely between residents of and to be performed entirely in the State of
California, without reference to that body of law relating to conflicts of law
or choice of law.

14.11
 Other
Remedies. Except as otherwise provided herein, any and all remedies herein
expressly conferred upon a party will be deemed cumulative with and not
exclusive of any other remedy conferred hereby or by law on such party, and the
exercise of any one remedy will not preclude the exercise of any
other.

14.12
 Jurisdiction.
The parties consent to the personal jurisdiction of and the venue in the state
and federal courts within California.

14.13
 Arbitration.
Any controversy or claim arising out of or relating to this Agreement, or the
breach thereof, shall be settled by arbitration in California conducted by a
single arbitrator in accordance with the rules of the American Arbitration
Association. The arbitrator may grant injunctions or other relief to the same
extent as if this matter had been adjudicated by a court. The prevailing party
shall be entitled to an award of reasonable attorneys’ fees and costs.
Notwithstanding the foregoing, any party may apply to any court having
jurisdiction for an interim injunctive order to enforce the terms hereof prior
to the initiation of any such arbitration proceeding.

14.14
 Specific
Performance. The parties acknowledge that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached. The parties
shall be entitled to an injunction(s) to prevent breaches of this Agreement and
to enforce specifically the terms and provisions hereof in any court of the
United States or any state having jurisdiction. This is in addition to any other
remedy to which the parties are entitled at law or in equity.

49

14.15
 Attorneys'
Fees. Should suit be brought to enforce or interpret any part of this Agreement,
the prevailing party will be entitled to recover, as an element of the costs of
suit and not as damages, reasonable attorneys' fees to be fixed by the court
(including without limitation, costs, expenses and fees on any appeal). The
prevailing party will be entitled to recover its costs of suit, regardless of
whether such suit proceeds to final judgment.

14.16
 Notices.
All notices, instructions and other communications required or permitted to be
given under this Agreement or necessary or convenient in connection herewith
must be in writing and shall be deemed given: (a) when personally served or when
delivered by telex or facsimile; (b) one business day after deposit with an
overnight courier service as shown by the records of such delivery service; (c)
on the business day of transmission if such notice is sent by facsimile and the
sender receives electronic confirmation of receipt by the recipient; or (d) on
the earlier of actual receipt or the third business day following the date on
which the notice is deposited in the United States mail, first class certified
or registered mail, postage prepaid, addressed as follows:

 

	 	If to Itec: 	Itec Environmental Group, Inc.
	 	 	Attention: Gary De Laurentiis
	 	 	P.O. Box 760
	 	 	Riverbank, CA 95367
	 	 	Fax Number: (209) 881-3529
	 	 	 
	 	with a copy to: 	The Otto Law Group, PLLC
	 	 	
      Attention:
      David M. Otto

	 	 	900 Fourth Avenue, Suite 3140
	 	 	Seattle, Washington 98164
	 	 	Fax Number: (206) 262 - 9513
	 	 	 
	 	If to Rose Waste: 	Rose Waste Systems, Inc.
	 	 	Attention: George Gitschel
	 	 	3 Violet Lane
	 	 	San Carlos, CA 94070
	 	 	Fax Number: (650) 596 - 5786
	 	 	 
	 	with a copy to:	Epstein, Englert, Staley & Coffey,
      P.C.
	 	 	425 California Street, Seventeenth
      Floor
	 	 	San Francisco, California 94104
	 	 	Attention: Sam Coffey
	 	 	Fax Number: 415-398-6938
	 	 	 
	 	 	 

       
or to
such other address as a party may have furnished to the other parties in writing
pursuant to this Section 14.16.

50

14.17
 Counterparts.
This Agreement may be executed in any number of counterparts, each of which will
be an original as regards any party whose signature appears thereon and all of
which together will constitute one and the same instrument. This Agreement will
become binding when one or more counterparts hereof, individually or taken
together, will bear the signatures of each of the parties reflected hereon as
signatories.

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

 

	ITEC:	 
	 	 
	ITEC ENVIRONMENTAL GROUP,
      INC.	 
	 	 
	/s/ Gary M. De Laurentiis	 
	
      

    	 
	By: Gary M. De Laurentiis	 
	Its: Chairman & CEO	 
	 	 
	MERGER SUB:	 
	 	 
	ITEC ACQUISITIONS,
      INC.	 
	 	 
	/s/ Gary M. De Laurentiis	 
	
      

       	 
	By: Gary M. De Laurentiis	 
	Its: Chairman & CEO	 
	 	 
	ROSE
      WASTE:	 
	 	 
	ROSE WASTE SYSTEMS,
      INC.	 
	 	 
	/s/ George Gitschel	 
	
      

       	 
	By: George Gitschel	 
	Its: Chief Executive Officer	 

 

 

[SIGNATURE
PAGE TO AGREEMENT AND PLAN OF MERGER]

 

51

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