Document:

Unassociated Document

    INVESTMENT
      AGREEMENT 

     

    This
      Agreement is made as of the 29th
      day of
      June, 2007, by and among Angstore
      Technologies Ltd.,
      a
      company duly registered in the state of Israel with its address at 7 HaOfe
      St., South Industrial Park, Ashkelon 78172 (the "Company")
      and
      Energtek Inc., a company duly registered in the State of Nevada, USA with its
      address at 26 East Hawthorne Avenue, Valley Stream, NY 11580, USA (the
      "Purchaser") 

    

    WHEREAS The
      Purchaser is a shareholder of the Company that presently holds 7,364 out of
      the
      16,364 issued and outstanding shares of the Company; and 

    

    WHEREAS The
      Purchaser wishes to purchase additional shares in the Company that shall bring
      its holdings in the Company to a majority holding in the Company and the Company
      agrees to issue such shares to the Purchaser as set forth herein;
      and

    

    WHEREAS The
      parties wish to set forth their agreements herein; 

    

    NOW
      THEREFORE, in consideration of the promises and mutual covenants contained
      herein, the Company and the Purchaser hereby agree as
      follows:

    

    
      	
              1.

            	
              Preamble
                and Appendixes

            

    

    
      	 	 	 

      	 	
              1.1.

            	
              The
                preamble to this Agreement as well as its appendixes forms an integral
                part hereto.

            

      	 	 	 

    

    
      	 	
              1.2.

            	
              The
                headings of the sections and subsections of this Agreement are made
                for
                convenience of reference only and are not to be considered in construing
                this Agreement.

            

    

    

    
      	
              2.

            	
              Purchase
                and Sale of Purchased Shares 

            

      	 	 

    

    
      	 	
              2.1.

            	
              The
                Purchaser agrees and undertakes to purchase, subject to the terms
                of this
                Agreement, from the Company, and the Company agrees to sell and issue
                to
                the Purchaser, an aggregate of 16,384 ordinary shares of the Company
                of
                NIS 1 par value, representing 50% of the Company’s issued and outstanding
                shares (the “Purchased Shares") on a fully diluted basis, as follows: On
                each Closing Date (hereafter defined), Purchaser shall purchase,
                and
                Company shall sell and issue, the number of shares of the Company’s
                ordinary shares set forth for each such Closing Date in Section 2.2
                hereof. The purchase price to be paid by Purchaser to the Company
                in
                consideration for the issuance of the Purchased Shares shall be $27.50
                per
                share (the "Purchase Price"), and shall be payable on each Closing
                Date
                with respect to the number of Purchased Shares purchased on such
                Closing
                Date.

            

    

    
    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              2.2.

            	
              The
                purchase and issuance of the Purchased Shares shall take place in
                three
                closings (each, a “Closing”)
                at the offices of Pelles, Moser, Sherman & Co. - Law Offices, located
                at 12 Abba Hillel Street, Ramat Gan, on June 29, 2007 or at such
                other
                time and place as may be agreed to by the parties in writing. The
                first
                closing shall take place on the date of this Agreement (the “First Closing
                Date”) simultaneously with the execution of this Agreement. The second
                closing shall take place during the month of July 2007 (the “Second
                Closing Date”). The third closing shall take place not later than August
                31, 2007 (the “Third Closing Date”). The number of Purchased Shares to be
                purchased and issued at each Closing shall be as
                follows:

            

      	 	 	 

    

    
      	 	
              2.2.1.

            	
              On
                the First Closing Date, 4,000 Purchased Shares shall be purchased
                and
                issued for an aggregate Purchase Price of
                US $110,000;

            

      	 	 	 

    

    
      	 	
              2.2.2.

            	
              On
                the Second Closing Date, 8,000 Purchased Shares shall be purchased
                and
                issued for an aggregate Purchase Price of US $220,000;
                and

            

      	 	 	 

    

    
      	 	
              2.2.3.

            	
              On
                the Third Closing Date, 4,364 Purchased Shares shall be purchased
                and
                issued for an aggregate Purchase Price of US
                $120,010.

            

      	 	 	 

    

    
      	 	
              2.3.

            	
              The
                capitalization table of the Company, pre and post the purchase of
                the
                Purchased Shares by the Purchaser, is as set in Exhibit
                2.3
                attached hereto. 

            

    

    
      	 	
              2.4.

            	
              The
                Company shall promptly notify the Registrar of Companies of the State
                of
                Israel of the issuance of the Purchased Shares, upon receipt of Purchase
                Price (or parts of the same according to Clause 2.2).
                

            

    

    
      	 	
              2.5.

            	
              The
                rights of the Purchased Shares are as determined in the memorandum
                and
                articles of association of the Company (as amended from time to
                time).

            

    

    

    
      	
              3.

            	
              Closing
                Deliveries.

            

      	 	 

    

    
      	 	
              3.1.

            	
              At
                each Closing, the Company shall deliver to Purchaser a share certificate
                representing the Purchased Shares purchased by Purchaser on that
                Closing
                Date against delivery to the Company by Purchaser of the Purchase
                Price
                therefor by wire transfer of immediately available funds to an account
                specified in writing by the Company.

            

      	 	 	 

    

    
      	 	
              3.2.

            	
              At
                the Closing taking place on the First Closing Date, the following
                additional transactions shall occur: 

            

      	 	 	 

    

    
      	 	
              3.2.1.

            	
              The
                Company shall deliver to the Purchaser a copy of a resolution of
                the
                Company’s shareholders approving this Agreement in the form attached
                hereto as Exhibit 3.2.1.

            

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              3.2.2.

            	
              The
                Company shall deliver to the Purchaser a copy of a resolution of
                the Board
                of Directors of the Company approving this Agreement, in the form
                attached
                hereto as Exhibit
                3.2.2 

            

      	 	 	 

    

    
      	 	
              3.2.3.

            	
              The
                Company shall secure any and all waivers required from any shareholders
                of
                the Company, regarding their pre-emptive rights in connection with
                the
                Purchased Shares, to the extent
                necessary.

            

      	 	 	 

    

    
      	 	
              3.2.4.

            	
              The
                Company shall notify the Office of the Chief Scientist in the ministry
                of
                Industry and Commerce ("the OCS") of such transaction. In the event
                the
                approval of the OCS shall be required, the Parties shall use their
                best
                endeavourers to secure such approval as soon as possible.
                

            

      	 	 	 

    

    
      	 	
              3.2.5.

            	
              The
                Purchaser shall deliver to the Company a copy of a resolution of
                the Board
                of Directors of the Purchaser approving this Agreement, in the form
                attached hereto as Exhibit
                3.2.5.

            

      	 	 	 

    

    
      	 	
              3.2.6.

            	
              The
                Purchaser shall deliver to the Company a copy of a resolution of
                the Board
                of Directors of the Purchaser, to be adopted within two business
                weeks
                from the Closing, nominating the CEO of the Company, Mr. Lev Zaidenberg,
                as President of the Purchaser. 

            

      	 	 	 

    

    
      	 	
              3.3

            	
              Conditions
                of Purchasers to Closing.
                The obligations of the Purchaser to purchase the Purchased Shares
                and to
                pay the Purchase Price at each Closing are subject to the fulfillment
                at
                or before the Closing Date for such Closing of the following conditions
                precedent (to the extent indicated below), any one or more of which
                may be
                waived in whole or in part by the Purchaser, which waiver shall be
                at the
                sole discretion of the Purchasers:

            

      	 	 	 

    

    
      	 	
              3.3.1

            	
              Representations
                and Warranties.
                The representations and warranties made by the Company in this Agreement
                shall have been true and correct when made, and shall be true and
                correct
                as of the Closing as if made on the
                Closing.

            

      	 	 	 

    

    
      	 	
              3.3.2

            	
              Covenants.
                All covenants, agreements, and conditions contained in this Agreement
                to
                be performed or complied with by the Company prior to the Closing
                shall
                have been performed or complied with by the Company, prior to or
                at the
                Closing.

            

      	 	 	 

    

    
      	 	
              3.3.3

            	
              Consents,
                etc.
                The Company shall have secured all permits, consents and authorizations
                that shall be necessary or required lawfully to consummate this Agreement
                and to issue the Purchased Shares to each Purchaser at the
                Closing.

            

      	 	 	 

    

    
      	 	
              3.3.4

            	
              Delivery
                of Documents.
                All of the documents to be delivered by the Company pursuant to Section
                3.2 shall have been delivered to the Purchasers. All other actions
                and
                transactions set forth in Section 3.2 shall have been completed on
                or
                prior to the Closing.

            

    

    
    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              3.3.5

            	
              Ordinary
                Course of Business.
                From the signing of this Agreement
                through the Closing, the Company has not taken, and has not agreed
                or
                resolved to take, any action which is outside the ordinary course
                of its
                business consistent with past custom and practice (including with
                respect
                to quantity and frequency).

            

      	 	 	 

    

    
      	
              4.

            	
              Representations
                and Warranties of the Company

            

      	 	 

      	 	The Company represents and warrants to the Purchaser,
              and
              acknowledges that the Purchaser is entering into this Agreement in
              reliance thereon, as of the date hereof as
              follows:

    

     

    
      	 	
              4.1.

            	
              Validity
                of Transaction.
                The Company has all requisite power and authority to execute, deliver,
                and
                perform this Agreement. All necessary corporate proceedings of the
                Company
                have been duly taken to authorize the execution, delivery, and performance
                of this Agreement by the Company. This Agreement is the legal, valid,
                and
                binding obligation of the Company, and is enforceable as to the Company
                in
                accordance with its terms. All waivers or other consents needed from
                any
                banks, shareholders, governmental entities, or other third parties
                in
                connection with the transactions contemplated by this Agreement,
                have been
                obtained, and evidence was delivered to the
                Purchaser.

            

      	 	 	 

    

    
      	 	
              4.2.

            	
              Capitalization.
                The share capital of the Company is as stated in Exhibit 2.3. There
                are no
                contracts, agreements, or understandings relating to the issuance,
                sale or
                transfer of any equity securities or other securities of Company,
                including any of the following: options, warrants, agreements, or
                other
                rights for the acquisition of shares of the Company's share capital;
                securities or other obligations of the Company which are convertible
                into
                shares of the Company's share capital; or sale agreements, shareholder
                agreements, pledges, proxies, voting trusts, powers of attorney,
                restrictions on transfer or other agreements or instruments that
                are
                binding on Seller or the Company, including without limitation, any
                such
                agreements or instruments that relate to the ownership, voting or
                transfer
                of any shares of the Company's share capital.

            

      	 	 	 

    

    
      	 	
              4.3.

            	
              Information.
                All written information which has been given by the Company to the
                Purchaser in the course of the negotiations leading to this Agreement
                was
                when given and is at the date hereof true and accurate in all material
                respects.

            

    

    
    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              4.4.

            	
              Contracts.
                The Company is not in breach of any deed, agreement or transaction
                to
                which it is a party, and to the best of its knowledge, no third party
                that
                has transacted business with the Company is in breach of any of its
                material obligations under any deed, agreement, or transaction to
                which it
                is a party with the Company. The Company has not given any guarantee,
                indemnity or security for or otherwise agreed to become directly
                or
                contingently liable for any obligation of any other person and no
                person
                has given any guarantee of or security for any obligation of the
                Company.

            

      	 	 	 

    

    
      	 	
              4.5.

            	
              Litigation.
                The Company is not involved in any civil, criminal or arbitration
                proceedings. 

            

      	 	 	 

      	 	4.6.	Debts and Loan Facilities.
              There are no debts owing by or to the Company other than (a) debts
              listed
              in the financial reports for the year ending Dec. 31st
              2006 and the 3 month period ending on March 31st
              2007, and (b) as detailed in Exhibit
              4.6
              and (c) which have arisen in the ordinary course of business. The Company
              has not lent any money that has not yet been repaid. The parties hereto
              confirm that after consummation of the investment, which is the subject
              of
              this Agreement, there are no other outstanding shareholder loans owed
              to
              any shareholder. 

    

      

    
      	 	
              4.7.

            	
              Brokers.
                No agent, broker, investment banker, person or firm acting in a similar
                capacity on behalf of or under the authority of the Company is or
                will be
                entitled to any broker's or finder's fee or any other commission
                or
                similar fee, directly or indirectly, on account of any action taken
                by the
                Company in connection with any of the transactions contemplated under
                this
                Agreement.

            

    

    
      	 	 

      	
              5.

            	
              Representations
                of the Purchaser

            

      	 	 

      	 	The Purchaser represents and warrants to the Company,
              and
              acknowledges that the Company is entering into this Agreement in reliance
              thereon, as of the date hereof as
              follows:

    

     

    
      	 	
              5.1

            	
              Validity
                of Transaction.
                The Purchaser has all requisite power and authority to execute, deliver,
                and perform this Agreement. All necessary corporate proceedings of
                the
                Purchaser have been duly taken to authorize the execution, delivery,
                and
                performance of this Agreement by the Purchaser. This Agreement is
                the
                legal, valid, and binding obligation of the Purchaser, and is enforceable
                as to the Purchaser in accordance with its terms. All waivers or
                other
                consents needed from any banks, shareholders, governmental entities,
                or
                other third parties in connection with the transactions contemplated
                by
                this Agreement, have been obtained, and evidence was delivered to
                the
                Purchaser.

            

    

    
    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              5.2

            	
              Brokers.
                No agent, broker, investment banker, person or firm acting in a similar
                capacity on behalf of or under the authority of Purchaser is or will
                be
                entitled to any broker's or finder's fee or any other commission
                or
                similar fee, directly or indirectly, on account of any action taken
                by
                Purchaser in connection with any of the transactions contemplated
                under
                this Agreement.

            

      	 	 	 

    

    
      	 	
              5.3

            	
              The
                Purchased Shares will be acquired for investment for by Purchaser
                for the
                Purchaser's own account, not as a nominee or agent, and not with
                a present
                view to the resale or distribution of any part thereof, and Purchaser
                has
                any present intention of selling, granting any participation in,
                or
                otherwise distributing the same.

            

      	 	 	 

    

    
      	 	
              5.4

            	
              Purchaser
                further represents that it is a shareholder of the Company and familiar
                with its business and has conducted such inspections as it deems
                fit.

            

      	 	 	 

    

    
      	
              6.

            	
              Miscellaneous

            

      	 	 

    

    
      	 	
              6.1.

            	
              Governing
                Law and Jurisdiction.
                This Agreement shall be governed and construed in accordance with
                the laws
                of Israel and the courts of Tel Aviv shall have sole jurisdiction.
                

            

      	 	 	 

    

    
      	 	
              6.2.

            	
              Entire
                Agreement.
                This agreement constitutes the entire agreement between the parties
                hereto
                pertaining to the transactions contemplated herein and embodies all
                the
                terms binding upon the parties in respect thereof. No party to this
                Agreement shall be liable or bound in any manner by prior consent
                or
                contemporaneous express or implied representation, warranty, statement,
                promise, covenant or agreement pertaining to the said transaction
                made by
                it or on its behalf unless same is expressly set forth or referred
                to
                herein.

            

      	 	 	 

    

    
      	 	
              6.3.

            	
              Notices.
                All notices in connection to this agreement will be in writing and
                delivered personally or sent by registered mail or certified mail,
                postage
                prepaid, by confirmed telefax or confirmed email, to the appropriate
                addresses of the parties or to any other address as each party may
                designate by written notice to the other party in the manner herein
                provided for such notice. Any notice thereunder shall be deemed to
                have
                been served or given as of the date such notice is actually received,
                is
                delivered personally, 7 days after dispatch if sent by registered
                mail or
                on the next business day if sent by telefax or by email, provided
                such
                delivery is confirmed.

            

      	 	 	 

    

    
      	 	
              6.4.

            	
              Amendments
                and Waivers.
                Any term of this Agreement may be amended and the observance of any
                term
                of this Agreement may be waived (either generally or in a particular
                instance and either retroactively or prospectively), only with the
                written
                consent of all the parties hereto.

            

    

    
    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	 	
              6.5.

            	
              Severability.
                If
                one or more provisions of this Agreement are held to be unenforceable
                under applicable law, such provision shall be excluded from this
                Agreement
                and the balance of the Agreement shall be interpreted as if such
                provisions were so excluded and shall be enforceable in accordance
                with
                its terms.

            

    

    

    Signatures
      in the following page

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    In
      witness whereof, the parties have executed this Investment Agreement as of
      the
      date first above written.

    

    

    [Signature
      page for June 29, 2007,  ordinary
      Shares Investment]

    

    

    
      	
              /s/
                Lev Zaidenberg_____________

            
	
              Angstore
                Technologies Ltd. 

            
	 

    

    By:
      Lev
      Zaidenberg

    Date:
      June 29, 2007

    
      	 
	
              /s/
                Doron Uziel________________

            
	
              Energtek
                Inc.

            
	 
	
              By:
                Doron Uziel

              Date:
                June 29, 2007

            

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
      2.3

    To
      the
      Investment Agreement made
      as
      of the 29th
      day of
      June, 2007, by and

    among
      Angstore Technologies Ltd. and Energtek Inc.,

     

     

    
 

    Capitalization
      of Angstore Technologies Ltd. 

    before
      the Investment

    

    
      	 	 	
              Shares

            	 	
              Percentage

            	 
	
              Radel
                LLC

            	 	 	
              9,000

            	 	 	
              55.0

            	
              %

            
	
              Energtek
                Inc.

            	 	 	
              7,364

            	 	 	
              45.0

            	
              %

            
	
              TOTAL

            	 	 	
              16,364

            	 	 	
              100.0

            	
              %

            

    

    

    

    Investments
      to take place

    

    
      	 	 	
              Investment

            	 	
              Shares

            	 
	
              First
                Closing

            	 	 	
              110,000

            	 	 	
              4,000

            	 
	
              Second
                Closing

            	 	 	
              220,000

            	 	 	
              8,000

            	 
	
              Third
                Closing

            	 	 	
              120,010

            	 	 	
              4,364

            	 
	
              TOTAL

            	 	 	
              450,010

            	 	 	
              16,364

            	 

    

    

    

    Capitalization
      after the Investment

    

    
      	 	 	
              Shares

            	 	
              Percentage

            	 
	
              Radel
                LLC

            	 	 	
              9,000

            	 	 	
              27.5

            	
              %

            
	
              Energtek
                Inc.

            	 	 	
              23,728

            	 	 	
              72.5

            	
              %

            
	
              TOTAL

            	 	 	
              32,728

            	 	 	
              100.0

            	
              %Unassociated Document

     

    

      Exhibit
        10.1

    SECURITIES
      PURCHASE AGREEMENT

    

     

    SECURITIES
      PURCHASE AGREEMENT (this “Agreement”),
      dated
      as of June ___, 2007, by and among Aftersoft Group, Inc a Delaware corporation,
      (the “Company”),
      and
      each of the purchasers set forth on the signature pages hereto (the
“Buyers”).

     

    WHEREAS:
      

     

    A. The
      Company and the Buyers are executing and delivering this Agreement in reliance
      upon the exemption from securities registration afforded by the rules and
      regulations as promulgated by the United States Securities and Exchange
      Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933
      Act”);

     

    B. Buyers
      desire to purchase and the Company desires to issue and sell, upon the terms
      and
      conditions set forth in this Agreement units comprised of (i) one share of
      common stock par value $0.0001 (the “common stock”) and (ii) one warrant,
      in the form attached hereto as Exhibit
      A,
      to
      purchase share of Common Stock (the “Warrants”)
      (the
“Units”).

     

    C. Each
      Buyer wishes to purchase, upon the terms and conditions stated in this
      Agreement, such principal amount of Units as is set forth immediately below
      its
      name on the signature pages hereto; and

     

    D. Contemporaneous
      with the execution and delivery of this Agreement, the parties hereto are
      executing and delivering a Registration Rights Agreement, in the form attached
      hereto as Exhibit
      “B”
      (the
“Registration
      Rights Agreement”),
      pursuant to which the Company has agreed to provide certain registration rights
      under the 1933 Act and the rules and regulations promulgated thereunder, and
      applicable state securities laws.

     

    NOW
      THEREFORE,
      the
      Company and each of the Buyers severally (and not jointly) hereby agree as
      follows:

     

    1. PURCHASE
      AND SALE OF UNITS.

     

    a. Purchase
      of Units.
      On the
      Closing Date (as defined below), the Company shall issue and sell to each Buyer
      and each Buyer severally agrees to purchase from the Company such principal
      amount of Units as is set forth immediately below such Buyer’s name on the
      signature pages hereto.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    b. Form
      of Payment.
      On the
      Closing Date (as defined below), (i) each Buyer shall pay the purchase
      price for the Units to be issued and sold to it at the Closing (as defined
      below) (the “Purchase
      Price”)
      by
      wire transfer of immediately available funds to the Company, in accordance
      with
      the Company’s written wiring instructions, against delivery of the Units equal
      to the Purchase Price as is set forth immediately below such Buyer’s name on the
      signature pages hereto, and (ii) the Company shall deliver such common
      stock and warrants that comprise the Units duly executed on behalf of the
      Company, to such Buyer, against delivery of such Purchase Price. 

     

    c. Closing
      Date.
      Subject
      to the satisfaction (or written waiver) of the conditions thereto set forth
      in
      Section 6 and Section 7 below, the date and time of the issuance and sale of
      the
      Units pursuant to this Agreement (the “Closing
      Date”)
      shall
      be 12:00 noon, New York time on June __, 2007, or such other mutually agreed
      upon time. The closing of the transactions contemplated by this Agreement (the
      “Closing”)
      shall
      occur on the Closing Date at such location as may be agreed to by the
      parties.

     

    2. BUYERS’
      REPRESENTATIONS AND WARRANTIES.
      Each
      Buyer severally (and not jointly) represents and warrants to the Company solely
      as to such Buyer that:

     

    a. Investment
      Purpose.
      As of
      the date hereof, the Buyer is purchasing the Units and the Warrants and the
      shares of Common Stock issuable upon exercise thereof (the “Warrant
      Shares”
and,
      collectively with the Units, Warrants and Shares, the “Securities”)
      for
      its own account and not with a present view towards the public sale or
      distribution thereof, except pursuant to sales registered or exempted from
      registration under the 1933 Act; provided,
      however,
      that by
      making the representations herein, the Buyer does not agree to hold any of
      the
      Securities for any minimum or other specific term and reserves the right to
      dispose of the Securities at any time in accordance with or pursuant to a
      registration statement or an exemption under the 1933 Act.

     

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

     

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

     

    d. Information.
      The
      Buyer and its advisors, if any, have been, and for so long as the Units
      including the securities underlying the Units, remain unregistered will continue
      to be, furnished with all materials relating to the business, finances and
      operations of the Company and materials relating to the offer and sale of the
      Securities which have been requested by the Buyer or its advisors. The Buyer
      and
      its advisors, if any, have been, and for so long as the Units and Warrants
      remain unregistered will continue to be, afforded the opportunity to ask
      questions of the Company. Notwithstanding the foregoing, the Company has not
      disclosed to the Buyer any material nonpublic information and will not disclose
      such information unless such information is disclosed to the public prior to
      or
      promptly following such disclosure to the Buyer. Neither such inquiries nor
      any
      other due diligence investigation conducted by Buyer or any of its advisors
      or
      representatives shall modify, amend or affect Buyer’s right to rely on the
      Company’s representations and warranties contained in Section 3 below. The Buyer
      understands that its investment in the Securities involves a significant degree
      of risk.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    e. Governmental
      Review.
      The
      Buyer understands that no United States federal or state agency or any other
      government or governmental agency has passed upon or made any recommendation
      or
      endorsement of the Securities.

     

    f. Transfer
      or Re-sale.
      The
      Buyer understands that (i) except as provided in the Registration Rights
      Agreement, the sale or re-sale of the Securities has not been and is not being
      registered under the 1933 Act or any applicable state securities laws, and
      the
      Securities may not be transferred unless (a) the Securities are sold
      pursuant to an effective registration statement under the 1933 Act, (b) the
      Buyer shall have delivered to the Company an opinion of counsel that shall
      be in
      form, substance and scope customary for opinions of counsel in comparable
      transactions to the effect that the Securities to be sold or transferred may
      be
      sold or transferred pursuant to an exemption from such registration, which
      opinion shall be accepted by the Company, (c) the Securities are sold or
      transferred to an “affiliate” (as defined in Rule 144 promulgated under the 1933
      Act (or a successor rule) (“Rule
      144”))
      of
      the Buyer who agrees to sell or otherwise transfer the Securities only in
      accordance with this Section 2(f) and who is an Accredited Investor,
      (d) the Securities are sold pursuant to Rule 144, or (e) the
      Securities are sold pursuant to Regulation S under the 1933 Act (or a successor
      rule) (“Regulation
      S”),
      and
      the Buyer shall have delivered to the Company an opinion of counsel that shall
      be in form, substance and scope customary for opinions of counsel in corporate
      transactions, which opinion shall be accepted by the Company; (ii) any sale
      of
      such Securities made in reliance on Rule 144 may be made only in accordance
      with
      the terms of said Rule and further, if said Rule is not applicable, any re-sale
      of such Securities under circumstances in which the seller (or the person
      through whom the sale is made) may be deemed to be an underwriter (as that
      term
      is defined in the 1933 Act) may require compliance with some other exemption
      under the 1933 Act or the rules and regulations of the SEC thereunder; and
      (iii)
      neither the Company nor any other person is under any obligation to register
      such Securities under the 1933 Act or any state securities laws or to comply
      with the terms and conditions of any exemption thereunder (in each case, other
      than pursuant to the Registration Rights Agreement). Notwithstanding the
      foregoing or anything else contained herein to the contrary, the Securities
      may
      be pledged as collateral in connection with a bona fide
      margin
      account or other lending arrangement. 

     

    g. Legends.
      The
      Buyer understands that the Units and, until such time as the Common Stock and
      Warrant Shares have been registered under the 1933 Act as contemplated by the
      Registration Rights Agreement or otherwise may be sold pursuant to Rule 144
      or
      Regulation S without any restriction as to the number of securities as of a
      particular date that can then be immediately sold, the Warrant Shares may bear
      a
      restrictive legend in substantially the following form (and a stop-transfer
      order may be placed against transfer of the certificates for such
      Securities):

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

      THE
        SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
        THE
        SECURITIES ACT OF 1933, AS AMENDED OR ANY STATE SECURITIES LAWS AND MAY NOT
        BE
        SOLD, OFFERED FOR SALE OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
        REGISTRATION STATEMENT OR AN OPINION OF COUNSEL OR OTHER EVIDENCE SATISFACTORY
        TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

    

     

    The
      legend set forth above shall be removed and the Company shall issue a
      certificate without such legend to the holder of any Security upon which it
      is
      stamped, if, unless otherwise required by applicable state securities laws,
      (a)
      such Security is registered for sale under an effective registration statement
      filed under the 1933 Act or otherwise may be sold pursuant to Rule 144 or
      Regulation S without any restriction as to the number of securities as of a
      particular date that can then be immediately sold, or (b) such holder provides
      the Company with an opinion of counsel, in form, substance and scope customary
      for opinions of counsel in comparable transactions, to the effect that a public
      sale or transfer of such Security may be made without registration under the
      1933 Act, which opinion shall be accepted by the Company so that the sale or
      transfer is effected or (c) such holder provides the Company with reasonable
      assurances that such Security can be sold pursuant to Rule 144 or Regulation
      S.
      The Buyer agrees to sell all Securities, including those represented by a
      certificate(s) from which the legend has been removed, in compliance with
      applicable prospectus delivery requirements, if any.

     

    h. Authorization;
      Enforcement.
      This
      Agreement and the Registration Rights Agreement have been duly and validly
      authorized. This Agreement has been duly executed and delivered on behalf of
      the
      Buyer, and this Agreement constitutes, and upon execution and delivery by the
      Buyer of the Registration Rights Agreement, such agreement will constitute,
      valid and binding agreements of the Buyer enforceable in accordance with their
      terms.

     

    i. Residency.
      The
      Buyer is a resident of the jurisdiction set forth immediately below such Buyer’s
      name on the signature pages hereto. 

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    3. REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY.
      The
      Company represents and warrants to each Buyer that:

     

    a. Organization
      and Qualification.
      The
      Company and each of its Subsidiaries (as defined below), if any, is a
      corporation duly organized, validly existing and in good standing under the
      laws
      of the jurisdiction in which it is incorporated, with full power and authority
      (corporate and other) to own, lease, use and operate its properties and to
      carry
      on its business as and where now owned, leased, used, operated and conducted.
      Schedule
      3(a)
      sets
      forth a list of all of the Subsidiaries of the Company and the jurisdiction
      in
      which each is incorporated. The Company and each of its Subsidiaries is duly
      qualified as a foreign corporation to do business and is in good standing in
      every jurisdiction in which its ownership or use of property or the nature
      of
      the business conducted by it makes such qualification necessary except where
      the
      failure to be so qualified or in good standing would not have a Material Adverse
      Effect. “Material
      Adverse Effect”
means
      any of (i) a material and adverse effect on the legality, validity or
      enforceability of any document executed in connection with this financing,
      (ii)
      a material and adverse effect on the results of operations, assets, prospects,
      business or condition (financial or otherwise) of the Company and the
      Subsidiaries, taken as a whole, or (iii) an adverse impairment to the Company’s
      ability to perform under any of the documents executed in connection with this
      financing. “Subsidiaries”
means
      any corporation or other organization, whether incorporated or unincorporated,
      in which the Company owns, directly or indirectly, any equity or other ownership
      interest.

     

    b. Authorization;
      Enforcement.
      (i) The
      Company has all requisite corporate power and authority to enter into and
      perform this Agreement, the Registration Rights Agreement, the Units (including
      the securities underlying the Units) and to consummate the transactions
      contemplated hereby and thereby and to issue the Securities, in accordance
      with
      the terms hereof and thereof, (ii) the execution and delivery of this Agreement,
      the Registration Rights Agreement, the Units (including the securities
      underlying the Units) by the Company and the consummation by it of the
      transactions contemplated hereby and thereby (including without limitation,
      the
      issuance of the Units and the issuance and reservation for issuance of the
      Warrant Shares issuable upon exercise thereof) have been duly authorized by
      the
      Company’s Board of Directors and no further consent or authorization of the
      Company, its Board of Directors, or its shareholders is required, (iii) this
      Agreement has been duly executed and delivered by the Company by its authorized
      representative, and such authorized representative is the true and official
      representative with authority to sign this Agreement and the other documents
      executed in connection herewith and bind the Company accordingly, and (iv)
      this
      Agreement constitutes, and upon execution and delivery by the Company of the
      Registration Rights Agreement, the Units, each of such instruments will
      constitute, a legal, valid and binding obligation of the Company enforceable
      against the Company in accordance with its terms.

     

    c. Capitalization.
      As of
      the date hereof, the authorized capital stock of the Company consists of (i)
      150,000,000 shares of Common Stock, par value [$.0001] per share, of
      which
      79,822,000
      shares
      are issued and outstanding, and [ ] shares are reserved for issuance, and
      [_____] shares are reserved for issuance. All of such outstanding shares of
      capital stock are, or upon issuance will be, duly authorized, validly issued,
      fully paid and nonassessable. No shares of capital stock of the Company are
      subject to preemptive rights or any other similar rights of the shareholders
      of
      the Company or any liens or encumbrances imposed through the actions or failure
      to act of the Company. 

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    d. Issuance
      of Shares.
      The
      Warrant Shares are duly authorized and reserved for issuance and, upon exercise
      of the Warrants in accordance with their respective terms, will be validly
      issued, fully paid and non-assessable, and free from all taxes, liens, claims
      and encumbrances with respect to the issue thereof and shall not be subject
      to
      preemptive rights or other similar rights of shareholders of the Company and
      will not impose personal liability upon the holder thereof.

     

    e. No
      Conflicts.
      The
      execution, delivery and performance of this Agreement, the Registration Rights
      Agreement, the Warrants by the Company and the consummation by the Company
      of
      the transactions contemplated hereby and thereby (including, without limitation,
      the issuance and reservation for issuance of the Warrant Shares) will not (i)
      conflict with or result in a violation of any provision of the Certificate
      of
      Incorporation or By-laws or (ii) violate or conflict with, or result in a breach
      of any provision of, or constitute a default (or an event which with notice
      or
      lapse of time or both could become a default) under, or give to others any
      rights of termination, amendment, acceleration or cancellation of, any
      agreement, indenture, patent, patent license or instrument to which the Company
      or any of its Subsidiaries is a party, or (iii) result in a violation of any
      law, rule, regulation, order, judgment or decree (including federal and state
      securities laws and regulations and regulations of any self-regulatory
      organizations to which the Company or its securities are subject) applicable
      to
      the Company or any of its Subsidiaries or by which any property or asset of
      the
      Company or any of its Subsidiaries is bound or affected (except for such
      conflicts, defaults, terminations, amendments, accelerations, cancellations
      and
      violations as would not, individually or in the aggregate, have a Material
      Adverse Effect). Neither the Company nor any of its Subsidiaries is in violation
      of its Certificate of Incorporation, By-laws or other organizational documents
      and neither the Company nor any of its Subsidiaries is in default (and no event
      has occurred which with notice or lapse of time or both could put the Company
      or
      any of its Subsidiaries in default) under, and neither the Company nor any
      of
      its Subsidiaries has taken any action or failed to take any action that would
      give to others any rights of termination, amendment, acceleration or
      cancellation of, any agreement, indenture or instrument to which the Company
      or
      any of its Subsidiaries is a party or by which any property or assets of the
      Company or any of its Subsidiaries is bound or affected, except for possible
      defaults as would not, individually or in the aggregate, have a Material Adverse
      Effect. The businesses of the Company and its Subsidiaries, if any, are not
      being conducted, and shall not be conducted so long as a Buyer owns any of
      the
      Securities, in violation of any law, ordinance or regulation of any governmental
      entity. Except as specifically contemplated by this Agreement and as required
      under the 1933 Act and any applicable state securities laws, the Company is
      not
      required to obtain any consent, authorization or order of, or make any filing
      or
      registration with, any court, governmental agency, regulatory agency, self
      regulatory organization or stock market or any third party in order for it
      to
      execute, deliver or perform any of its obligations under this Agreement, the
      Registration Rights Agreement, the Units in accordance with the terms hereof
      or
      thereof or to issue and sell the Units in accordance with the terms hereof
      and
      to issue the Warrant Shares upon exercise of the Warrants. Except as disclosed
      in Schedule
      3(f),
      all
      consents, authorizations, orders, filings and registrations which the Company
      is
      required to obtain pursuant to the preceding sentence have been obtained or
      effected on or prior to the date hereof. The Company is not in violation of
      the
      quotation requirements of the Over-the-Counter Bulletin Board (the “OTCBB”).
      

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    f. SEC
      Documents; Financial Statements.
      Except
      as disclosed in Schedule
      3(g),
      the
      Company has timely filed all reports, schedules, forms, statements and other
      documents required to be filed by it with the SEC pursuant to the reporting
      requirements of the Securities Exchange Act of 1934, as amended (the
“1934
      Act”)
      (all
      of the foregoing filed prior to the date hereof and all exhibits included
      therein and financial statements and schedules thereto and documents (other
      than
      exhibits to such documents) incorporated by reference therein, being hereinafter
      referred to herein as the “SEC
      Documents”).
      As of
      their respective dates, the SEC Documents complied in all material respects
      with
      the requirements of the 1934 Act and the rules and regulations of the SEC
      promulgated thereunder applicable to the SEC Documents, and none of the SEC
      Documents, at the time they were filed with the SEC, contained any untrue
      statement of a material fact or omitted to state a material fact required to
      be
      stated therein or necessary in order to make the statements therein, in light
      of
      the circumstances under which they were made, not misleading. None of the
      statements made in any such SEC Documents is, or has been, required to be
      amended or updated under applicable law (except for such statements as have
      been
      amended or updated in subsequent filings prior the date hereof). As of their
      respective dates, the financial statements of the Company included in the SEC
      Documents complied as to form in all material respects with applicable
      accounting requirements and the published rules and regulations of the SEC
      with
      respect thereto. Such financial statements have been prepared in accordance
      with
      United States generally accepted accounting principles, consistently applied,
      during the periods involved (except (i) as may be otherwise indicated in such
      financial statements or the notes thereto, or (ii) in the case of unaudited
      interim statements, to the extent they may not include footnotes or may be
      condensed or summary statements) and fairly present in all material respects
      the
      consolidated financial position of the Company and its consolidated Subsidiaries
      as of the dates thereof and the consolidated results of their operations and
      cash flows for the periods then ended (subject, in the case of unaudited
      statements, to normal year-end audit adjustments). Except as set forth in the
      financial statements of the Company included in the SEC Documents, the Company
      has no liabilities, contingent or otherwise, other than (i) liabilities incurred
      in the ordinary course of business subsequent to June 30, 2006 and (ii)
      obligations under contracts and commitments incurred in the ordinary course
      of
      business and not required under generally accepted accounting principles to
      be
      reflected in such financial statements, which, individually or in the aggregate,
      are not material to the financial condition or operating results of the
      Company.

     

    g. Absence
      of Certain Changes.
      Since
      June 30, 2006 there has been no material adverse change and no material adverse
      development in the assets, liabilities, business, properties, operations,
      financial condition, results of operations or prospects of the Company or any
      of
      its Subsidiaries.

     

    h. Absence
      of Litigation.
      Except
      as disclosed in Schedule 3 (h). There is no action, suit, claim, proceeding,
      inquiry or investigation before or by any court, public board, government
      agency, self-regulatory organization or body pending or, to the knowledge of
      the
      Company or any of its Subsidiaries, threatened against or affecting the Company
      or any of its Subsidiaries, or their officers or directors in their capacity
      as
      such, that could have a Material Adverse Effect. In addition Schedule
      3(h)
      contains
      a complete list and summary description of any pending or threatened proceeding
      against or affecting the Company or any of its Subsidiaries, without regard
      to
      whether it would have a Material Adverse Effect. The Company and its
      Subsidiaries are unaware of any facts or circumstances which might give rise
      to
      any of the foregoing.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    i. Patents,
      Copyrights, etc.
      The
      Company and each of its Subsidiaries owns or possesses the requisite licenses
      or
      rights to use all patents, patent applications, patent rights, inventions,
      know-how, trade secrets, trademarks, trademark applications, service marks,
      service names, trade names and copyrights (“Intellectual
      Property”)
      necessary to enable it to conduct its business as now operated (and, except
      as
      set forth in Schedule
      3(i)
      hereof,
      to the best of the Company’s knowledge, as presently contemplated to be operated
      in the future); there is no claim or action by any person pertaining to, or
      proceeding pending, or to the Company’s knowledge threatened, which challenges
      the right of the Company or of a Subsidiary with respect to any Intellectual
      Property necessary to enable it to conduct its business as now operated (and,
      except as set forth in Schedule
      3(i)
      hereof,
      to the best of the Company’s knowledge, as presently contemplated to be operated
      in the future); to the best of the Company’s knowledge, the Company’s or its
      Subsidiaries’ current and intended products, services and processes do not
      infringe on any Intellectual Property or other rights held by any person; and
      the Company is unaware of any facts or circumstances which might give rise
      to
      any of the foregoing. The Company and each of its Subsidiaries have taken
      reasonable security measures to protect the secrecy, confidentiality and value
      of their Intellectual Property.

     

    j. No
      Materially Adverse Contracts, Etc.
      Neither
      the Company nor any of its Subsidiaries is subject to any charter, corporate
      or
      other legal restriction, or any judgment, decree, order, rule or regulation
      which in the judgment of the Company’s officers has or is expected in the future
      to have a Material Adverse Effect. Neither the Company nor any of its
      Subsidiaries is a party to any contract or agreement which in the judgment
      of
      the Company’s officers has or is expected to have a Material Adverse
      Effect.

     

    k. Tax
      Status.
      Except
      as set forth on Schedule
      3(k),
      the
      Company and each of its Subsidiaries has made or filed all federal, state and
      foreign income and all other tax returns, reports and declarations required
      by
      any jurisdiction to which it is subject (unless and only to the extent that
      the
      Company and each of its Subsidiaries has set aside on its books provisions
      reasonably adequate for the payment of all unpaid and unreported taxes) and
      has
      paid all taxes and other governmental assessments and charges that are material
      in amount, shown or determined to be due on such returns, reports and
      declarations, except those being contested in good faith and has set aside
      on
      its books provisions reasonably adequate for the payment of all taxes for
      periods subsequent to the periods to which such returns, reports or declarations
      apply. There are no unpaid taxes in any material amount claimed to be due by
      the
      taxing authority of any jurisdiction, and the officers of the Company know
      of no
      basis for any such claim. The Company has not executed a waiver with respect
      to
      the statute of limitations relating to the assessment or collection of any
      foreign, federal, state or local tax. Except as set forth on Schedule
      3(k),
      none of
      the Company’s tax returns is presently being audited by any taxing
      authority.

     

    l. Disclosure.
      All
      information relating to or concerning the Company or any of its Subsidiaries
      set
      forth in this Agreement and provided to the Buyers pursuant to Section 2(d)
      hereof and otherwise in connection with the transactions contemplated hereby
      is
      true and correct in all material respects and the Company has not omitted to
      state any material fact necessary in order to make the statements made herein
      or
      therein, in light of the circumstances under which they were made, not
      misleading. No event or circumstance has occurred or exists with respect to
      the
      Company or any of its Subsidiaries or its or their business, properties,
      prospects, operations or financial conditions, which, under applicable law,
      rule
      or regulation, requires public disclosure or announcement by the Company but
      which has not been so publicly announced or disclosed.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    m. Acknowledgment
      Regarding Buyers’ Purchase of Securities.
      The
      Company acknowledges and agrees that the Buyers are acting solely in the
      capacity of arm’s length purchasers with respect to this Agreement and the
      transactions contemplated hereby. The Company further acknowledges that no
      Buyer
      is acting as a financial advisor or fiduciary of the Company (or in any similar
      capacity) with respect to this Agreement and the transactions contemplated
      hereby and any statement made by any Buyer or any of their respective
      representatives or agents in connection with this Agreement and the transactions
      contemplated hereby is not advice or a recommendation and is merely incidental
      to the Buyers’ purchase of the Securities. The Company further represents to
      each Buyer that the Company’s decision to enter into this Agreement has been
      based solely on the independent evaluation of the Company and its
      representatives.

     

    n. No
      Integrated Offering.
      Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf, has directly or indirectly made any offers or sales in any security
      or
      solicited any offers to buy any security under circumstances that would require
      registration under the 1933 Act of the issuance of the Securities to the Buyers.
      The issuance of the Securities to the Buyers will not be integrated with any
      other issuance of the Company’s securities (past, current or future) for
      purposes of any shareholder approval provisions applicable to the Company or
      its
      securities.

     

    o. Permits;
      Compliance.
      The
      Company and each of its Subsidiaries is in possession of all franchises, grants,
      authorizations, licenses, permits, easements, variances, exemptions, consents,
      certificates, approvals and orders necessary to own, lease and operate its
      properties and to carry on its business as it is now being conducted
      (collectively, the “Company
      Permits”),
      and
      there is no action pending or, to the knowledge of the Company, threatened
      regarding suspension or cancellation of any of the Company Permits. Neither
      the
      Company nor any of its Subsidiaries is in conflict with, or in default or
      violation of, any of the Company Permits, except for any such conflicts,
      defaults or violations which, individually or in the aggregate, would not
      reasonably be expected to have a Material Adverse Effect. Since June 30, 2006,
      neither the Company nor any of its Subsidiaries has received any notification
      with respect to possible conflicts, defaults or violations of applicable laws,
      except for notices relating to possible conflicts, defaults or violations,
      which
      conflicts, defaults or violations would not have a Material Adverse
      Effect.

     

    p. Title
      to Property.
      The
      Company and its Subsidiaries have good and marketable title in fee simple to
      all
      real property and good and marketable title to all personal property owned
      by
      them which is material to the business of the Company and its Subsidiaries,
      in
      each case free and clear of all liens, encumbrances and defects except such
      as
      are described in Schedule
      3(p)
      or such
      as would not have a Material Adverse Effect. Any real property and facilities
      held under lease by the Company and its Subsidiaries are held by them under
      valid, subsisting and enforceable leases with such exceptions as would not
      have
      a Material Adverse Effect.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

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

     

    r. Internal
      Accounting Controls.
      The
      Company and each of its Subsidiaries maintain a system of internal accounting
      controls sufficient, in the judgment of the Company’s management, to provide
      reasonable assurance that (i) transactions are executed in accordance with
      management’s general or specific authorizations, (ii) transactions are recorded
      as necessary to permit preparation of financial statements in conformity with
      generally accepted accounting principles and to maintain asset accountability,
      (iii) access to assets is permitted only in accordance with management’s general
      or specific authorization and (iv) the recorded accountability for assets is
      compared with the existing assets at reasonable intervals and appropriate action
      is taken with respect to any differences.

     

    s. No
      Investment Company.
      The
      Company is not, and upon the issuance and sale of the Securities as contemplated
      by this Agreement will not be an “investment company” required to be registered
      under the Investment Company Act of 1940 (an “Investment
      Company”).
      The
      Company is not controlled by an Investment Company.

     

    4. COVENANTS.

     

    a. Best
      Efforts.
      The
      parties shall use their best efforts to satisfy timely each of the conditions
      described in Section 6 and 7 of this Agreement. 

     

    b. Form
      D; Blue Sky Laws.
      The
      Company agrees to file a Form D with respect to the Securities as required
      under
      Regulation D. The Company shall, on or before the Closing Date, take such action
      as the Company shall reasonably determine is necessary to qualify the Securities
      for sale to the Buyers at the applicable closing pursuant to this Agreement
      under applicable securities or “blue sky” laws of the states of the United
      States (or to obtain an exemption from such qualification), and shall provide
      evidence of any such action so taken to each Buyer on or prior to the Closing
      Date.

     

    c. Reporting
      Status; Eligibility to Use Form S-3, SB-2 or Form S-1. The
      Company’s Common Stock is registered under [Section 12(g)] of the 1934 Act. The
      Company represents and warrants that it meets the requirements for the use
      of
      Form S-3 (or if the Company is not eligible for the use of Form S-3 as of the
      Filing Date (as defined in the Registration Rights Agreement), the Company
      may
      use the form of registration for which it is eligible at that time) for
      registration of the sale by the Buyer of the Registrable Securities (as defined
      in the Registration Rights Agreement). So long as the Buyer beneficially owns
      any of the Securities, the Company shall timely file all reports required to
      be
      filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate
      its status as an issuer required to file reports under the 1934 Act even if
      the
      1934 Act or the rules and regulations thereunder would permit such termination.
      The Company further agrees to file all reports required to be filed by the
      Company with the SEC in a timely manner so as to become eligible, and thereafter
      to maintain its eligibility, for the use of Form S-3. 

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    d. Use
      of Proceeds.
      The
      Company shall use the net proceeds from the sale of the Units in the manner
      set
      forth in Schedule
      4(d)
      attached
      hereto. 

     

    e. Authorization
      and Reservation of Shares.
      The
      Company shall at all times have authorized, and reserved for the purpose of
      issuance, a sufficient number of shares of Common Stock to provide for the
      full
      exercise of the outstanding Warrants and issuance of the Warrant Shares in
      connection therewith (based on the Exercise Price of the Warrants in effect
      from
      time to time). The Company shall not reduce the number of shares of Common
      Stock
      reserved for issuance upon exercise of the Warrants without the consent of
      each
      Buyer. The Company shall at all times maintain the number of shares of Common
      Stock so reserved for issuance at an amount (“Reserved
      Amount”)
      equal
      to no less than (1.5) times the number that is then actually issuable upon
      full
      exercise of the Warrants and the Additional Warrants (based on the Exercise
      Price of the Warrants in effect from time to time). If at any time the number
      of
      shares of Common Stock authorized and reserved for issuance (“Authorized
      and Reserved Shares”)
      is
      below the Reserved Amount, the Company will promptly take all corporate action
      necessary to authorize and reserve a sufficient number of shares, including,
      without limitation, calling a special meeting of shareholders to authorize
      additional shares to meet the Company’s obligations under this Section 4(h), in
      the case of an insufficient number of authorized shares, obtain shareholder
      approval of an increase in such authorized number of shares, and voting the
      management shares of the Company in favor of an increase in the authorized
      shares of the Company to ensure that the number of authorized shares is
      sufficient to meet the Reserved Amount. 

     

    5. TRANSFER
      AGENT INSTRUCTIONS.
      The
      Company shall issue irrevocable instructions to its transfer agent to issue
      certificates, registered in the name of each Buyer or its nominee, for the
      Warrant Shares in such amounts as specified from time to time by each Buyer
      to
      the Company upon exercise of the Warrants in accordance with the terms thereof
      (the “Irrevocable
      Transfer Agent Instructions”).
      Prior
      to registration of the Warrant Shares under the 1933 Act or the date on which
      the Warrant Shares may be sold pursuant to Rule 144 without any restriction
      as
      to the number of Securities as of a particular date that can then be immediately
      sold, all such certificates shall bear the restrictive legend specified in
      Section 2(g) of this Agreement. The Company warrants that no instruction other
      than the Irrevocable Transfer Agent Instructions referred to in this Section
      5,
      and stop transfer instructions to give effect to Section 2(f) hereof (in the
      case of the Warrant Shares, prior to registration of the Warrant Shares under
      the 1933 Act or the date on which the Warrant Shares may be sold pursuant to
      Rule 144 without any restriction as to the number of Securities as of a
      particular date that can then be immediately sold), will be given by the Company
      to its transfer agent and that the Securities shall otherwise be freely
      transferable on the books and records of the Company as and to the extent
      provided in this Agreement and the Registration Rights Agreement. Nothing in
      this Section shall affect in any way the Buyer’s obligations and agreement set
      forth in Section 2(g) hereof to comply with all applicable prospectus delivery
      requirements, if any, upon re-sale of the Securities. If a Buyer provides the
      Company with (i) an opinion of counsel in form, substance and scope customary
      for opinions in comparable transactions, to the effect that a public sale or
      transfer of such Securities may be made without registration under the 1933
      Act
      and such sale or transfer is effected or (ii) the Buyer provides reasonable
      assurances that the Securities can be sold pursuant to Rule 144, the Company
      shall permit the transfer, and, in the case of the Warrant Shares, promptly
      instruct its transfer agent to issue one or more certificates, free from
      restrictive legend, in such name and in such denominations as specified by
      such
      Buyer. The Company acknowledges that a breach by it of its obligations hereunder
      will cause irreparable harm to the Buyers, by vitiating the intent and purpose
      of the transactions contemplated hereby. Accordingly, the Company acknowledges
      that the remedy at law for a breach of its obligations under this Section 5
      may
      be inadequate and agrees, in the event of a breach or threatened breach by
      the
      Company of the provisions of this Section, that the Buyers shall be entitled,
      in
      addition to all other available remedies, to an injunction restraining any
      breach and requiring immediate transfer, without the necessity of showing
      economic loss and without any bond or other security being
      required.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    6. CONDITIONS
      TO THE COMPANY’S OBLIGATION TO SELL.
      The
      obligation of the Company hereunder to issue and sell the Units to a Buyer
      at
      the Closing is subject to the satisfaction, at or before the Closing Date of
      each of the following conditions thereto, provided that these conditions are
      for
      the Company’s sole benefit and may be waived by the Company at any time in its
      sole discretion:

     

    a. The
      applicable Buyer shall have executed this Agreement and the Registration Rights
      Agreement, and delivered the same to the Company.

     

    b. The
      applicable Buyer shall have delivered the Purchase Price in accordance with
      Section 1(b) above.

     

    c. The
      representations and warranties of the applicable Buyer shall be true and correct
      in all material respects as of the date when made and as of the Closing Date
      as
      though made at that time (except for representations and warranties that speak
      as of a specific date), and the applicable Buyer shall have performed, satisfied
      and complied in all material respects with the covenants, agreements and
      conditions required by this Agreement to be performed, satisfied or complied
      with by the applicable Buyer at or prior to the Closing Date. 

     

    d. No
      litigation, statute, rule, regulation, executive order, decree, ruling or
      injunction shall have been enacted, entered, promulgated or endorsed by or
      in
      any court or governmental authority of competent jurisdiction or any
      self-regulatory organization having authority over the matters contemplated
      hereby which prohibits the consummation of any of the transactions contemplated
      by this Agreement.

     

    7. CONDITIONS
      TO EACH BUYER’S OBLIGATION TO PURCHASE.
      The
      obligation of each Buyer hereunder to purchase the Units at the Closing is
      subject to the satisfaction, at or before the Closing Date of each of the
      following conditions, provided that these conditions are for such Buyer’s sole
      benefit and may be waived by such Buyer at any time in its sole
      discretion:

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    a. The
      Company shall have executed this Agreement and the Registration Rights
      Agreement, and delivered the same to the Buyer.

     

    b. The
      Company shall have delivered to such Buyer duly executed Notes (in such
      denominations as the Buyer shall request) and Warrants in accordance with
      Section 1(b) above.

     

    c. The
      Irrevocable Transfer Agent Instructions, in form and substance satisfactory
      to a
      majority-in-interest of the Buyers, shall have been delivered to and
      acknowledged in writing by the Company’s Transfer Agent.

     

    d. The
      representations and warranties of the Company shall be true and correct in
      all
      material respects as of the date when made and as of the Closing Date as though
      made at such time (except for representations and warranties that speak as
      of a
      specific date) and the Company shall have performed, satisfied and complied
      in
      all material respects with the covenants, agreements and conditions required
      by
      this Agreement to be performed, satisfied or complied with by the Company at
      or
      prior to the Closing Date. No litigation, statute, rule, regulation, executive
      order, decree, ruling or injunction shall have been enacted, entered,
      promulgated or endorsed by or in any court or governmental authority of
      competent jurisdiction or any self-regulatory organization having authority
      over
      the matters contemplated hereby which prohibits the consummation of any of
      the
      transactions contemplated by this Agreement.

     

    e. No
      event
      shall have occurred which could reasonably be expected to have a Material
      Adverse Effect on the Company.

     

    f. The
      Warrant Shares shall have been authorized for quotation on the OTCBB and trading
      in the Common Stock on the OTCBB shall not have been suspended by the SEC or
      the
      OTCBB.

     

    g. The
      Buyer
      shall have received an opinion of the Company’s counsel, dated as of the Closing
      Date, in form, scope and substance reasonably satisfactory to the Buyer and
      in
      substantially the same form as Exhibit
      C
      attached
      hereto.

     

    h. [The
      Buyer
      shall have received an officer’s certificate described in Section 3(c) above,
      dated as of the Closing Date.]

     

    8. GOVERNING
      LAW; MISCELLANEOUS.
      

     

    a. Governing
      Law.
      THIS
      AGREEMENT SHALL BE ENFORCED, GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
      LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
      ENTIRELY WITHIN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICT OF
      LAWS. THE PARTIES HERETO HEREBY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE
      UNITED STATES FEDERAL COURTS LOCATED IN NEW YORK, NEW YORK WITH RESPECT TO
      ANY
      DISPUTE ARISING UNDER THIS AGREEMENT, THE AGREEMENTS ENTERED INTO IN CONNECTION
      HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. BOTH PARTIES
      IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF
      SUCH SUIT OR PROCEEDING. BOTH PARTIES FURTHER AGREE THAT SERVICE OF PROCESS
      UPON
      A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE
      SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR PROCEEDING. NOTHING HEREIN
      SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED
      BY LAW. BOTH PARTIES AGREE THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH
      SUIT
      OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS
      BY
      SUIT ON SUCH JUDGMENT OR IN ANY OTHER LAWFUL MANNER. THE PARTY WHICH DOES NOT
      PREVAIL IN ANY DISPUTE ARISING UNDER THIS AGREEMENT SHALL BE RESPONSIBLE FOR
      ALL
      FEES AND EXPENSES, INCLUDING ATTORNEYS’ FEES, INCURRED BY THE PREVAILING PARTY
      IN CONNECTION WITH SUCH DISPUTE.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    b. Counterparts;
      Signatures by Facsimile.
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original but all of which shall constitute one and the same agreement
      and shall become effective when counterparts have been signed by each party
      and
      delivered to the other party. This Agreement, once executed by a party, may
      be
      delivered to the other party hereto by facsimile transmission of a copy of
      this
      Agreement bearing the signature of the party so delivering this
      Agreement.

     

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

     

    d. Severability.
      In the
      event that any provision of this Agreement is invalid or unenforceable under
      any
      applicable statute or rule of law, then such provision shall be deemed
      inoperative to the extent that it may conflict therewith and shall be deemed
      modified to conform with such statute or rule of law. Any provision hereof
      which
      may prove invalid or unenforceable under any law shall not affect the validity
      or enforceability of any other provision hereof.

     

    e. Entire
      Agreement; Amendments.
      This
      Agreement and the instruments referenced herein contain the entire understanding
      of the parties with respect to the matters covered herein and therein and,
      except as specifically set forth herein or therein, neither the Company nor
      the
      Buyer makes any representation, warranty, covenant or undertaking with respect
      to such matters. No provision of this Agreement may be waived or amended other
      than by an instrument in writing signed by the party to be charged with
      enforcement. 

     

    f. Notices.
      Any
      notices required or permitted to be given under the terms of this Agreement
      shall be sent by certified or registered mail (return receipt requested) or
      delivered personally or by courier (including a recognized overnight delivery
      service) or by facsimile and shall be effective five days after being placed
      in
      the mail, if mailed by regular United States mail, or upon receipt, if delivered
      personally or by courier (including a recognized overnight delivery service)
      or
      by facsimile, in each case addressed to a party. The addresses for such
      communications shall be:

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    If
      to the
      Company:

    

    Aftersoft
      Group, Inc.

    c/o
      Gersten Savage LLP

    600
      Lexington Ave, 9th
      Floor

    New
      York,
      NY 10022

     

    Attention:
      Chief Executive Officer

    Telephone:
      (212) 752-9700

    Facsimile:
      (212) 980-5192 

     

    With
      a
      copy to:

     

    Gersten
      Savage LLP

    600
      Lexington Avenue

    New
      York,
      New York 10022

    Attention:
      David E. Danovitch, Esq.

    Telephone:
      (212) 752-9700

    Facsimile:
      (212) 980-5192

     

    If
      to a
      Buyer: To the address set forth immediately below such Buyer’s name on the
      signature pages hereto.

     

    With
      copy
      to:

     

    

     

    

     

    Each
      party shall provide notice to the other party of any change in
      address.

     

    g. Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties and
      their successors and assigns. Neither the Company nor any Buyer shall assign
      this Agreement or any rights or obligations hereunder without the prior written
      consent of the other. Notwithstanding the foregoing, subject to
      Section 2(f), any Buyer may assign its rights hereunder to any person that
      purchases Securities in a private transaction from a Buyer or to any of its
      “affiliates,” as that term is defined under the 1934 Act, without the consent of
      the Company.

     

    h. Third
      Party Beneficiaries.
      This
      Agreement is intended for the benefit of the parties hereto and their respective
      permitted successors and assigns, and is not for the benefit of, nor may any
      provision hereof be enforced by, any other person.

     

    i. Survival.
      The
      representations and warranties of the Company and the agreements and covenants
      set forth in Sections 3, 4, 5 and 8 shall survive the closing hereunder
      notwithstanding any due diligence investigation conducted by or on behalf of
      the
      Buyers. The Company agrees to indemnify and hold harmless each of the Buyers
      and
      all their officers, directors, employees and agents for loss or damage arising
      as a result of or related to any breach or alleged breach by the Company of
      any
      of its representations, warranties and covenants set forth in Sections 3 and
      4
      hereof or any of its covenants and obligations under this Agreement or the
      Registration Rights Agreement, including advancement of expenses as they are
      incurred.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    j. Publicity.
      The
      Company and each of the Buyers shall have the right to review a reasonable
      period of time before issuance of any press releases, SEC, OTCBB or NASD
      filings, or any other public statements with respect to the transactions
      contemplated hereby; provided,
      however,
      that
      the Company shall be entitled, without the prior approval of each of the Buyers,
      to make any press release or SEC, OTCBB (or other applicable trading market)
      or
      NASD filings with respect to such transactions as is required by applicable
      law
      and regulations (although each of the Buyers shall be consulted by the Company
      in connection with any such press release prior to its release and shall be
      provided with a copy thereof and be given an opportunity to comment
      thereon).

     

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

     

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

     

    m. Remedies.
      The
      Company acknowledges that a breach by it of its obligations hereunder will
      cause
      irreparable harm to the Buyers by vitiating the intent and purpose of the
      transaction contemplated hereby. Accordingly, the Company acknowledges that
      the
      remedy at law for a breach of its obligations under this Agreement will be
      inadequate and agrees, in the event of a breach or threatened breach by the
      Company of the provisions of this Agreement, that the Buyers shall be entitled,
      in addition to all other available remedies at law or in equity, and in addition
      to the penalties assessable herein, to an injunction or injunctions restraining,
      preventing or curing any breach of this Agreement and to enforce specifically
      the terms and provisions hereof, without the necessity of showing economic
      loss
      and without any bond or other security being required.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF,
      the
      undersigned Buyers and the Company have caused this Agreement to be duly
      executed as of the date first above written.

    

    

    Aftersoft
      Group, Inc

    

    ________________________________

    Ian
      Warwick

    Chief
      Executive Officer 

    

    [_______________]

    By:
      [____________]

    

    

    ______________________________________

    [_______________]

    [_______________]

    

    

    RESIDENCE:
      

    

    ADDRESS: 

    

    

    

    AGGREGATE
      SUBSCRIPTION AMOUNT:

    

    
      	
              Number
                of Units:

            	
                ________

            
	
              Aggregate
                Purchase Price:

            	
              $________

            

    

    

    

    
      
        
        

      

      
        17

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