Document:

Unassociated Document

    
      Exhibit
4.1

      

      

      IMAGE
METRICS, INC.

      

      Warrant
No. ___

      

      FORM OF WARRANT TO PURCHASE
COMMON STOCK

       

      VOID
AFTER 5:00 P.M., EASTERN TIME,

      ON THE
EXPIRATION DATE

      

      THIS
WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), AND MAY NOT
BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED WITHOUT
COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION PROVISIONS OF APPLICABLE
FEDERAL AND STATE SECURITIES LAWS OR WITHOUT DELIVERING AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

      

      FOR VALUE
RECEIVED, Image
Metrics, Inc., a
Nevada corporation (the “Company”),
hereby agrees to sell upon the terms and on the conditions hereinafter set
forth, at any time commencing on the date hereof but no later than 5:00 p.m.,
Eastern Time, on __________, 2014 (the “Expiration
Date”), to ______________________, or his, her or its registered assigns
(the “Holder”),
under the terms as hereinafter set forth, ____________ (_____) fully paid and
non-assessable shares of the Company’s Common Stock, par value $.001 per share
(the
“Common
Stock”), at a purchase price per share of $1.50 (the “Warrant
Price”), pursuant to the terms and conditions set forth in this warrant
(this “Warrant”).
The number of shares of Common Stock issued upon exercise of this Warrant
(“Warrant
Shares”) and the Warrant Price are subject to adjustment in certain
events as hereinafter set forth.

      

      This
Warrant is one of a series of the Company’s Warrants to purchase Common Stock
issued pursuant to the Company’s Confidential Private Placement Memorandum,
dated January 26, 2010, as the same may be supplemented from time to time, to
investors.

      

      
        
          
            	
                     
      

                  	
                    1.

                  	
                    Exercise
      of Warrant.

                  

          

            

        

      

      (a)      The
Holder may exercise this Warrant according to the terms and conditions set
forthherein by delivering to the Company, at the address set forth in Section 13
prior to 5:00 p.m., Eastern Time, on the Expiration Date (i) this Warrant, (ii)
the Subscription Form attached hereto as Exhibit A (the “Subscription
Form”) (having then been duly executed by the Holder), (iii) cash, a
certified check or a bank draft in payment of the purchase price, in lawful
money of the United States of America, for the number of Warrant Shares
specified in the Subscription Form.

      

      (b)      This
Warrant may be exercised in whole or in part so long as any exercise in part
hereof would not involve the issuance of fractional Warrant Shares. If exercised
in part, the Company shall deliver to the Holder a new Warrant, identical in
form to this Warrant, in the name of the Holder, evidencing the right to
purchase the number of Warrant Shares as to which this Warrant has not been
exercised, which new Warrant shall be signed by the President or Chief Executive
Officer of the Company. The term Warrant as used herein shall include any
subsequent Warrant issued as provided herein.

      

      (c)      No
fractional Warrant Shares or scrip representing fractional Warrant Shares shall
be issued upon the exercise of this Warrant. The Company shall pay cash in lieu
of such fractional Warrant Shares. The price of a fractional Warrant Share shall
equal the product of (i) the closing price of the Common Stock on the exchange
or market on which the Common Stock is then traded (if the Common Stock is not
then publicly traded, then upon the fair market value per share of the Common
Stock (as determined by the Company’s Board of Directors)), and (ii) the
applicable fraction.

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

      

      (d)      In
the event of any exercise of the rights represented by this Warrant, a
certificate or certificates for Warrant Shares so purchased, registered in the
name of the Holder on the stock transfer books of the Company, shall be
delivered to the Holder within a reasonable time after such rights shall have
been so exercised. The person or entity in whose name any certificate for
Warrant Shares is issued upon exercise of the rights represented by this Warrant
shall for all purposes be deemed to have become the holder of record of such
Warrant Shares immediately prior to the close of business on the date on which
the Warrant was surrendered and payment of the Warrant Price and any applicable
taxes was made, irrespective of the date of delivery of such certificate, except
that, if the date of such surrender and payment is a date when the stock
transfer books of the Company are closed, such person shall be deemed to have
become the holder of such shares at the opening of business on the next
succeeding date on which the Company’s stock transfer books are open. Except as
provided in Section 4 hereof, the Company shall pay any and all documentary
stamp or similar issue or transfer taxes payable in respect of the issue or
delivery of Warrant Shares on exercise of this Warrant.

      

      (e)      The
Company will not close its stockholder books or records in any manner which
prevents the timely exercise of this Warrant, pursuant to the terms
hereof.

      

      
        
          
            	
                     
      

                  	
                    2.

                  	
                    Disposition
      of Warrant Shares and Warrant.

                  

          

        

      

       

      (a)      The
Holder hereby acknowledges that: (i) this Warrant and any Warrant Shares
purchased pursuant hereto are not being registered (A) under the Securities Act
of 1933 (the “Act”)
on the ground that the issuance of this Warrant is exempt from registration
under Section 4(2) of the Act as not involving any public offering, or (B) under
any applicable state securities law because the issuance of this Warrant does
not involve any public offering; and (ii) that the Company’s reliance on the
registration exemption under Section 4(2) of the Act and under applicable state
securities laws is predicated in part on the representations hereby made to the
Company by the Holder. The Holder represents and warrants that he, she or it is
acquiring this Warrant and will acquire Warrant Shares for investment for his,
her or its own account, with no present intention of dividing his, her or its
participation with others or reselling or otherwise distributing this Warrant or
Warrant Shares.

      

      (b)      The
Holder hereby agrees that he, she or it will not sell, transfer, pledge or
otherwise dispose of (collectively, “Transfer”)
all or any part of this Warrant and/or Warrant Shares unless and until he, she
or it shall have first have given notice to the Company describing such Transfer
and furnished to the Company (i) a statement from the transferee, whereby the
transferee represents and warrants that he, she, or it is acquiring this Warrant
and will acquire Warrant Shares, as applicable, for investment for his, her or
its own account, with no present intention of dividing his, her or its
participation with others or reselling or otherwise distributing this Warrant or
Warrant Shares, as applicable, and either (ii) an opinion, reasonably
satisfactory to counsel for the Company, of counsel (competent in securities
matters, selected by the Holder and reasonably satisfactory to the Company) to
the effect that the proposed Transfer may be made without registration under the
Act and without registration or qualification under any state law, or (iii) an
interpretative letter from the U.S. Securities and Exchange Commission to the
effect that no enforcement action will be recommended if the proposed sale or
transfer is made without registration under the Act.

      

      (c)      If,
at the time of issuance of Warrant Shares, no registration statement is in
effect with respect to such shares under applicable provisions of the Act, the
Company may, at its election, require that (i) the Holder provide written
reconfirmation of the Holder’s investment intent to the Company, and (ii) any
stock certificate evidencing Warrant Shares shall bear legends reading
substantially as follows:

      

      “THE
SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THE SHARES REPRESENTED BY THIS
CERTIFICATE IS SUBJECT TO CERTAIN RESTRICTIONS SET FORTH IN THE WARRANT PURSUANT
TO WHICH THESE SHARES WERE PURCHASED FROM THE COMPANY.  COPIES OF SUCH
RESTRICTIONS ARE ON FILE AT THE PRINCIPAL OFFICES OF THE COMPANY. NO TRANSFER OF
SUCH SHARES OR OF THIS CERTIFICATE (OR OF ANY SHARES OR OTHER SECURITIES (OR
CERTIFICATES THEREFOR) ISSUED IN EXCHANGE FOR OR IN RESPECT OF SUCH SHARES)
SHALL BE EFFECTIVE UNLESS AND UNTIL THE TERMS AND CONDITIONS SET FORTH IN THE
WARRANT HAVE BEEN COMPLIED WITH.”

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      “THE
SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) OR AN OPINION OF COUNSEL SATISFACTORY TO THE
ISSUER OF THIS CERTIFICATE THAT REGISTRATION IS NOT REQUIRED UNDER THE
ACT.”

      

      In
addition, so long as the foregoing legend may remain on any stock certificate
evidencing Warrant Shares, the Company may maintain appropriate “stop transfer”
orders with respect to such certificates and the shares represented thereby on
its books and records and with those to whom it may delegate registrar and
transfer functions.

      

      3.           Reservation
of Shares.
The Company hereby agrees that at all times there shall be reserved for
issuance upon the exercise of this Warrant such number of shares of the Common
Stock as shall be required for issuance upon exercise of this Warrant. The
Company further agrees that all Warrant Shares will be duly authorized and will,
upon issuance and payment of the exercise price therefor, be validly issued,
fully paid and non-assessable, free from all taxes, liens, charges and
encumbrances with respect to the issuance thereof, other than taxes, if any, in
respect of any transfer occurring contemporaneously with such issuance and other
than transfer restrictions imposed by federal and state securities
laws.

      

      Except
and to the extent as waived or consented to by the Holder, the Company shall not
by any action, including, without limitation, amending its certificate or
articles of incorporation or through any reorganization, transfer of assets,
consolidation, merger, dissolution, issue or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist in the
carrying out of all such terms and in the taking of all such actions as may be
necessary or appropriate to protect the rights of Holder as set forth in this
Warrant.  Without limiting the generality of the foregoing, the
Company will (a) not increase the par value of any Warrant Shares above the
amount payable therefor upon such exercise immediately prior to such increase in
par value, (b) take all such action as may be necessary or appropriate in order
that the Company may validly and legally issue fully paid and nonassessable
Warrant Shares upon the exercise of this Warrant, and (c) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents
from any public regulatory body having jurisdiction thereof as may be necessary
to enable the Company to perform its obligations under this
Warrant.

      

      Before
taking any action which would result in an adjustment in the number of Warrant
Shares for which this Warrant is exercisable or in the Exercise Price, the
Company shall obtain all such authorizations or exemptions thereof, or consents
thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof.

      

      4.            Exchange,
Transfer or Assignment of Warrant.  Subject
to Section 2, this Warrant is exchangeable, without expense, at the option of
the Holder, upon presentation and surrender hereof to the Company or at the
office of its stock transfer agent, if any, for other Warrants of the Company
(“Warrants”)
of different denominations, entitling the Holder or Holders thereof to purchase
in the aggregate the same number of Warrant Shares purchasable hereunder.
Subject to Section 2, upon surrender of this Warrant to the Company or at the
office of its stock transfer agent, if any, with the Assignment Form attached
hereto as Exhibit
B (the “Assignment
Form”) duly executed and funds sufficient to pay any transfer tax, the
Company shall, without charge, execute and deliver a new Warrant in the name of
the assignee named in the Assignment Form and this Warrant shall promptly be
canceled. Subject to Section 2, this Warrant may be divided or combined with
other Warrants that carry the same rights upon presentation hereof at the office
of the Company or at the office of its stock transfer agent, if any, together
with a written notice specifying the names and denominations in which new
Warrants are to be issued and signed by the Holder hereof.

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      5.           Capital
Adjustments.
This Warrant is subject to
the following further provisions:

      

      (a)      Recapitalization,
Reclassification and Succession. If any recapitalization of the Company
or reclassification of its Common Stock or any merger or consolidation of the
Company into or with a corporation or other business entity, or the sale or
transfer of all or substantially all of the Company’s assets or of any successor
corporation’s assets to any other corporation or business entity (any such
corporation or other business entity being included within the meaning of the
term “successor corporation”) shall be effected, at any time while this Warrant
remains outstanding and unexpired, then, as a condition of such
recapitalization, reclassification, merger, consolidation, sale or transfer,
lawful and adequate provision shall be made whereby the Holder of this Warrant
thereafter shall have the right to receive upon the exercise hereof as provided
in Section 1 and in lieu of the Warrant Shares immediately theretofore issuable
upon the exercise of this Warrant, such shares of capital stock, securities or
other property as may be issued or payable with respect to or in exchange for
the number of outstanding shares of Common Stock equal to the number of Warrant
Shares immediately theretofore issuable upon the exercise of this Warrant had
such recapitalization, reclassification, merger, consolidation, sale or transfer
not taken place, and in each such case, the terms of this Warrant shall be
applicable to the shares of stock or other securities or property receivable
upon the exercise of this Warrant after such consummation.

      

      (b)      Subdivision or Combination
of Shares. If the Company at any time while this Warrant remains
outstanding and unexpired shall subdivide or combine its Common Stock, the
number of Warrant Shares purchasable upon exercise of this Warrant shall be
proportionately adjusted.

      

      (c)      Stock Dividends and
Distributions.  If the Company at any time while this Warrant
is outstanding and unexpired shall issue or pay the holders of its Common Stock,
or take a record of the holders of its Common Stock for the purpose of entitling
them to receive, a dividend payable in, or other distribution of, Common Stock,
then the number of Warrant Shares purchasable upon exercise of this Warrant
shall be adjusted to the number of shares of Common Stock that Holder would have
owned immediately following such action had this Warrant been exercised
immediately prior thereto.

      

      (d)      Exercise Price
Adjustment. (i) If, prior to
exercise of this Warrant, the Company has issued, or shall be deemed to have
issued, Additional Shares of Common Stock (as defined below) for a consideration
per share of less than the then applicable Adjustment Trigger Price (as defined
below) or with a per share conversion, exercise or exchange price of less than
the then applicable Adjustment Trigger Price (each, a “Triggering
Issuance” and such lesser consideration or per share conversion, exercise
or exchange price, the “Triggering
Issuance Price”), then the Warrant Price will be adjusted immediately
thereafter so that it shall equal the rate determined by multiplying the Warrant
Price in effect immediately prior thereto by a fraction, the numerator of which
shall be the sum of the number of shares of Common Stock outstanding immediately
prior to the issuance of such additional shares and the number of shares of
Common Stock which the aggregate consideration received for the issuance of such
additional shares would purchase at such current market price per share of
Common Stock, and the denominator of which shall be the number of shares of
Common Stock outstanding immediately after the issuance of such additional
shares, multiplied by 1.50 (the “Adjusted
Warrant Price”). Thereafter, unless and until further adjusted pursuant
to this Section 5(d) or Section 5(e) hereof, the Warrant Price shall equal the
Adjusted Warrant Price and the Adjustment Trigger Price shall equal the
Triggering Issuance Price. The “Adjustment Trigger Price” shall be $1.00 on the
date hereof and be subject to adjustment as set forth in this Section 5(d) and
Section 5(e).

      

      (ii)      As
used herein, “Additional
Shares” shall mean all shares of Common Stock, or any securities
convertible into or exercisable or exchangeable for shares of Common Stock
(“Common
Stock Equivalents”), issued or deemed to be issued by the Company after
the date hereof; provided, however, that
issuances or deemed issuances described in subsections (a), (b) or (c) of this
Section 5 and in the case of (A) shares of Common Stock (or Common Stock
Equivalents) issued in acquisitions, mergers or strategic alliances, as
reasonably determined by the Board of Directors of the Company in the exercise
of their business judgment, (B) exercises of outstanding Image Metrics Limited
stock options and warrants assumed by the Company as a result of the Exchange
Offer (as defined in the Memorandum) consummated on _________, 2010, or (c)
shares of Common Stock (or Common Stock Equivalents) issued in connection with a
bridge financing and the conversion into the offering described in the
Memorandum of interim loans made prior to the Exchange Offer, shall not be
deemed issuances of Additional Shares of Common Stock.

      

      (e)      Price Adjustments.
Whenever the number of Warrant Shares purchasable upon exercise of this Warrant
is adjusted pursuant to Sections 5(a), 5(b) or 5(c), the then applicable Warrant
Price and then applicable Adjustment Trigger Price shall be proportionately
adjusted.

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      

      (f)      Certain Shares
Excluded. The number of shares of Common Stock outstanding at any given
time for purposes of the adjustments set forth in this Section 5 shall exclude
any shares then directly or indirectly held in the treasury of the
Company.

      

      (g)      Deferral and Cumulation of
De Minimis Adjustments.  The Company shall not be required to
make any adjustment pursuant to this Section 5 if the amount of such adjustment
would be less than one percent (1%) of the Warrant Price in effect immediately
before the event that would otherwise have given rise to such adjustment. In
such case, however, any adjustment that would otherwise have been required to be
made shall be made at the time of and together with the next subsequent
adjustment which, together with any adjustment or adjustments so carried
forward, shall amount to not less than one percent (1%) of the Warrant Price in
effect immediately before the event giving rise to such next subsequent
adjustment. All calculations under this Section 5 shall be made to the nearest
cent or to the nearest one-hundredth of a share, as the case may be, but in no
event shall the Company be obligated to issue fractional Warrant Shares or
fractional portions of any securities upon the exercise of the
Warrant.

      

      (h)      Duration of
Adjustment. Following each computation or readjustment as provided in
this Section 5, the new adjusted Warrant Price and number of Warrant Shares
purchasable upon exercise of this Warrant shall remain in effect until a further
computation or readjustment thereof is required.

      

      (i)      Voluntary Adjustment by
Company. The Company may at any time during the term of this Warrant
reduce the then current Exercise Price to any amount and for any period of time
deemed appropriate by the Board of Directors of the Company.

      

      
        
          
            	
                     
      

                  	
                    6.

                  	
                    Redemption.

                  

          

            

        

      

      (a)      Optional Redemption.
Provided that the Registration Statement is then effective, the Company may
redeem not less than all the Warrants then outstanding for the Redemption Price
any time after the average Closing Bid Price of the Company’s Common Stock
exceeds $5.00 per share for a period of 30 days with an average daily trading
volume of at least 50,000 shares per day for a period of 20 Trading Days ending
within 15 days of the Notice Date.

      

      (b)      Redemption
Procedures.  Not less than 30 days before any Redemption Date,
written notice shall be given to the Holder of this Warrant specifying the
number of Warrant Shares underlying this Warrant to be redeemed, the paragraph
of this Section 6 pursuant to which such redemption shall be made and the place
and date of such redemption, which date shall not be a day on which banks in the
City of New York are required or authorized to close. If such notice of
redemption shall have been duly given and if on or before such Redemption Date
the funds necessary for redemption shall have been set aside so as to be and
continue to be available therefor, then, notwithstanding that this Warrant shall
not have been surrendered for cancellation, after the close of business on such
Redemption Date, the Warrant Shares so called for redemption shall no longer be
Warrant Shares and all rights with respect to such Warrant Shares shall
forthwith after the close of business on the Redemption Date cease, except only
the right of the Holder to receive, upon presentation of this Warrant, the
Redemption Price therefor, without interest thereon. The Warrant may be
exercised in accordance with its terms at any time after notice of redemption
shall have been given by the Company pursuant to this section and prior to the
time and date fixed for redemption. On and after the redemption date, the record
holder of the Warrant shall have no further rights except to receive, upon
surrender of the Warrant, the Redemption Price.

      

      (c)      Definitions. For the
purposes of this Section 6, the following definitions shall apply:

      

      “Closing
Bid Price” shall mean as of any date, the last closing bid price on the
Principal Market, as reported by Bloomberg, or, if the Principal Market begins
to operate on an extended hours basis and does not designate the closing bid
price then the last bid price  prior to 4:00:00 p.m., New York Time,
as reported by Bloomberg, or, if the Principal Market is not the principal
securities exchange or trading market for such security, the last closing bid
price on the Eligible Market that is the principal securities exchange or
trading market where such security is listed or traded as reported by Bloomberg,
or if the foregoing do not apply, the last closing bid price of such security in
the over-the-counter market on the electronic bulletin board for such security
as reported by Bloomberg, or, if no closing bid price is reported for such
security by Bloomberg, the average of the bid prices of any market makers for
such security as reported in the "pink sheets" by Pink Sheets LLC (formerly the
National Quotation Bureau, Inc.).

      
        
           

        

        
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      “Eligible
Market” shall mean the Principal Market, the Nasdaq Global Market, the
Nasdaq Capital Market, the New York Stock Exchange, Inc. or the NYSE Amex
(formerly the American Stock Exchange).

      

      “Notice
Date” shall mean the date on which written notice is given to the Holder
of this Warrant pursuant to this Section 6.

      

      “Principal
Market” shall mean the OTC Bulletin Board.

      

      “Redemption
Date” shall mean the date set by the Company for redemption of this
Warrant.

      

      “Redemption
Price” shall mean $.05 per Warrant Share

      

      “Registration
Statement” shall mean the registration statement registering the Warrant
Shares to be filed by the Company, as further described in the Subscription
Agreement (as defined below).

      

      “Reporting
Period” shall mean the four full fiscal quarters immediately following
the date of this Warrant.

      

      “Trading
Day” shall mean any day on which trading in the Common Stock is reported
on the Principal Market, or, if the Principal Market is not the principal
trading market for the Common Stock, then on the Eligible Market that is the
principal securities exchange or securities market on which the Common Stock is
then traded; provided that "Trading Day" shall not include any day on which the
Common Stock is scheduled to trade on such exchange or market for less than 4.5
hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market
does not designate in advance the closing time of trading on such exchange or
market, then during the hour ending at 4:00 p.m., Eastern Time).

       

      
        
          	
                   
      

                	
                  7.

                	
                  Notice
      to Holders.

                

        

      

      
         

      

      (a)      Notice of Record Date. In
case:

      

      (i)      the
Company shall take a record of the holders of its Common Stock (or other stock
or securities at the time receivable upon the exercise of this Warrant) for the
purpose of entitling them to receive any dividend (other than a cash dividend
payable out of earned surplus of the Company) or other distribution, or any
right to subscribe for or purchase any shares of stock of any class or any other
securities, or to receive any other right;

      

      (ii)     of
any capital reorganization of the Company, any reclassification of the capital
stock of the Company, any consolidation with or merger of the Company into
another corporation, or any conveyance of all or substantially all of the assets
of the Company to another corporation; or

      

      (iii)    of
any voluntary dissolution, liquidation or winding-up of the
Company;

      

      then, and
in each such case, the Company will mail or cause to be mailed to the Holder
hereof at the time outstanding a notice specifying, as the case may be, (i) the
date on which a record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such dividend,
distribution or right, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding-up is to take place, and the time, if any, is to be fixed, as of which
the holders of record of Common Stock (or such stock or securities at the time
receivable upon the exercise of this Warrant) shall be entitled to exchange
their shares of Common Stock (or such other stock or securities) for securities
or other property deliverable upon such reorganization, reclassification,
consolidation, merger, conveyance, dissolution or winding-up. Such notice shall
be mailed at least ten (10) calendar days prior to the record date therein
specified, or if no record date shall have been specified therein, at least ten
(10) days prior to such specified date.

      
        
           

        

        
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      (b)      Certificate of
Adjustment. Whenever any adjustment shall be made pursuant to Section 5
hereof, the Company shall promptly make available and have on file for
inspection a certificate signed by its Chairman, Chief Executive Officer,
President or a Vice President, setting forth in reasonable detail the event
requiring the adjustment, the amount of the adjustment, the method by which such
adjustment was calculated and the Warrant Price and number of Warrant Shares
purchasable upon exercise of this Warrant after giving effect to such
adjustment.

      

      7.          
 Loss,
Theft, Destruction or Mutilation.
Upon receipt by the Company of evidence satisfactory to it, in the
exercise of its reasonable discretion, of the ownership and the loss, theft,
destruction or mutilation of this Warrant and, in the case of loss, theft or
destruction, of indemnity reasonably satisfactory to the Company and, in the
case of mutilation, upon surrender and cancellation thereof, the Company will
execute and deliver in lieu thereof, without expense to the Holder, a new
Warrant of like tenor dated the date hereof.

      

      8.      
    Warrant
Holder Not a Stockholder.
The Holder of this Warrant, as such, shall not be entitled by reason of
this Warrant to any rights whatsoever as a stockholder of the Company, including
but not limited to voting rights. No provision hereof, in the absence of any
affirmative action by Holder to exercise this Warrant to purchase Warrant
Shares, and no enumeration herein of the rights or privileges of Holder, shall
give rise to any liability of Holder for the purchase price of any Common Stock
or as a stockholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.

      

      9.     
    Registration
Rights.
Warrant Shares will be accorded the registration rights under the Act set
forth in that certain subscription agreement between the Company and the
original Holder (the “Subscription
Agreement”) pursuant to which this Warrant was originally
issued.

      

      10.   
    Notices.
Any notice provided for in this Warrant must be in writing and must be
either personally delivered, mailed by first class mail (postage prepaid and
return receipt requested), or sent by reputable overnight courier service
(charges prepaid) to the recipient at the address below indicated:

      

      If to the
Company:

      

      Image
Metrics, Inc.

      1918 Main
Street, 2nd
Floor

      Santa
Monica, California 90405

      Attention:
President

      

      If to the
Holder:

      

      To the
address of such Holder set forth on the books and records of the
Company.

      

      or such
other address or to the attention of such other person as the recipient party
shall have specified by prior written notice to the sending party. Any notice
under this Warrant will be deemed to have been given (a) if personally
delivered, upon such delivery, (b) if mailed, five days after deposit in the
U.S. mail, or (c) if sent by reputable overnight courier service, one business
day after such services acknowledges receipt of the notice.

      

      11.  
    Choice
of Law.
THIS WARRANT IS ISSUED UNDER AND SHALL FOR ALL PURPOSES BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT
GIVING EFFECT TO ITS CONFLICTS OF LAW RULES.

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      

      12.     
  Submission
to Jurisdiction. EACH OF THE HOLDER AND THE COMPANY SUBMITS TO THE
JURISDICTION OF ANY STATE OR FEDERAL COURT SITTING IN THE COUNTY OF LOS ANGELES,
STATE OF CALIFORNIA, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS WARRANT AND AGREES THAT ALL CLAIMS IN RESPECT OF THE ACTION OR PROCEEDING
MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. EACH OF THE HOLDER AND THE
COMPANY ALSO AGREE NOT TO BRING ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS WARRANT IN ANY OTHER COURT. EACH OF THE PARTIES WAIVES ANY
DEFENSE OF INCONVENIENT FORUM TO THE MAINTENANCE OF ANY ACTION OR PROCEEDING SO
BROUGHT AND WAIVES ANY BOND, SURETY, OR OTHER SECURITY THAT MIGHT BE REQUIRED OF
ANY OTHER PARTY WITH RESPECT THERETO.

      

      13.     
  Warrant
Register. The Company shall register this Warrant, upon records to be
maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time.
The Company may deem and treat the registered Holder of this Warrant as the
absolute owner hereof for the purpose of any exercise hereof or any distribution
to the Holder, and for all other purposes, absent actual notice to the
contrary.

       

      
        
          	
                   
      

                	
                  14.

                	
                  Miscellaneous.

                

        

          

      

      (a)      Remedies. Holder, in
addition to being entitled to exercise all rights granted by law, including
recovery of damages, will be entitled to specific performance of its rights
under this Warrant.  The Company agrees that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach by it
of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be
adequate.

      

      (b)      Successors and
Assigns. Subject to applicable securities laws, this Warrant and the
rights and obligations evidenced hereby shall inure to the benefit of and be
binding upon the successors of the Company and the successors and permitted
assigns of Holder. The provisions of this Warrant are intended to be for the
benefit of all Holders from time to time of this Warrant and shall be
enforceable by any such Holder or holder of Warrant Shares.

      

      (c)      Amendment. This
Warrant may be modified or amended or the provisions hereof waived with the
written consent of the Company and the Holder.

      

      (d)      Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Warrant shall be prohibited by or invalid under applicable law, such
provision shall be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.

      

      IN
WITNESS WHEREOF, the Company has duly caused this Warrant to be signed on its
behalf, in its corporate name and by a duly authorized officer, as of this ___
day of ________ 2010.

      

      
        
          
            
              	
                      IMAGE
      METRICS, INC.

                    
	 
      
	
                      By:

                    	 	
                          

                    
	 
      	
                      Michael
      R. Starkenburg

                    
	 
      	
                      President
      and Chief Executive
Officer

                    

            

          

        

      

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      EXHIBIT
A

      

      SUBSCRIPTION
FORM

      

      Image
Metrics, Inc.

      1918 Main
Street, 2nd
Floor

      Santa
Monica, California 90405

      Attention:
President

      

      The
undersigned hereby (1) irrevocably elects to exercise his, her or its rights to
purchase ____________ shares of the common stock, par value $.001 per share
(“Common
Stock”), of Image Metrics, Inc., a Nevada corporation, covered by the
attached Warrant, (2) makes payment in full of the purchase price therefore by
enclosure of cash, a certified check or bank draft, (3) requests that
certificates for such shares of Common Stock be issued in the name
of:

      

      (Please
print the Warrant holder’s name, address and Social Security/Tax Identification
Number)

      

      
        
          	
                     

                
	 
      
	
                     

                
	 
      
	
                     

                

        

      

      

      and (4)
if such number of shares of Common Stock shall not be all the shares receivable
upon exercise of the attached Warrant, requests that a new Warrant for the
balance of the shares covered by the attached Warrant be registered in the name
of, and delivered to:

      

      (Please
print name, address and Social Security/Tax Identification Number)

      

      
        
          	
                     

                
	 
      
	
                     

                
	 
      
	
                     

                

        

      

      

      In lieu
of receipt of a fractional share of Common Stock, the undersigned will receive a
check representing payment therefor.

      

      
        
          
            
              
                	
                        Dated:
      _____________________

                      	 	
                         

                      
	 
      	
                        PRINT
      WARRANT HOLDER NAME

                      
	 
      	 
      
	 
      	
                           

                      
	 
      	
                        Name:

                      
	 
      	
                        Title:

                      

              

            

          

        

      

      

      
        
          	
                  Witness:

                
	 
      
	
                     

                

        

      

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      EXHIBIT
B

      

      ASSIGNMENT
FORM

      

      Image
Metrics, Inc.

      1918 Main
Street, 2nd
Floor

      Santa
Monica, California 90405

      Attention:
President

      

      FOR VALUE
RECEIVED, _______________________________________________ hereby sells, assigns
and transfers unto

      

      (Please
print assignee’s name, address and Social Security/Tax Identification
Number)

      

      
        
          	
                     

                
	 
      
	
                     

                
	 
      
	
                     

                

        

      

      

      the right
to purchase shares of common stock, par value $.001 per share, of Image Metrics,
Inc., a Nevada corporation (the “Company”),
represented by this Warrant to the extent of shares as to which such right is
exercisable and does hereby irrevocably constitute and appoint
____________________________, Attorney, to transfer the same on the books of the
Company with full power of substitution in the premises.

      

      
        
          
            
              
                	
                        Dated:
      _____________________

                      	 	
                         

                      
	 
      	
                        PRINT
      WARRANT HOLDER NAME

                      
	 
      	 
      
	 
      	
                           

                      
	 
      	
                        Name:

                      
	 
      	
                        Title:

                      

              

            

          

        

      

      

      
        
          	
                  Witness:

                
	 
      
	
                     

                

        

      

      
        
           

        

        
          10Unassociated Document

    

      Exhibit
10.1

      

       

      IMAGE
METRICS

      

      FORM OF SUBSCRIPTION
DOCUMENTS AND INSTRUCTIONS

      

      INSTRUCTIONS

      

      The
following documents must be completed in accordance with the instructions set
forth below and must be executed in order to determine whether you are an
accredited investor and, if accredited, in order to subscribe for the purchase
of units (“Units”),
each unit consisting of one share of Series A Convertible Preferred Stock
(“Preferred
Stock”), and a detachable warrant to purchase one-half share of Common
Stock (“Warrants”),
of a publicly-traded company which will, by an exchange offer, acquire all of
the outstanding ordinary and preferred shares and business of Image Metrics
Limited, a corporation organized under the laws of England and
Wales.

      

      PLEASE PRINT THE ANSWERS TO
ALL QUESTIONS.

      

      1.            Enclosed are the Following
Documents:

      

      (a)          Subscription
Agreement. Be sure to carefully and fully read the Subscription
Agreement, and execute the signature page which is applicable to you. On the
appropriate signature page of the Subscription Agreement, the Subscriber must
sign, print his, her or its name, address and social security or tax
identification number where indicated, and indicate the number of Units
subscribed for, the date of execution and the manner in which title to the
Preferred Stock and Warrants will be held.

      

      (b)          Investor
Questionnaire. Be sure to carefully and fully read the Investor
Questionnaire, which can be found after the signature pages to the Subscription
Agreement. On the signature page of the Investor Questionnaire, the Subscriber
must sign and print his, her or its name where indicated.

      

      A
PROSPECTIVE SUBSCRIBER MUST BE SURE TO CAREFULLY AND FULLY READ THE ACCOMPANYING
CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM PRIOR TO RETURNING THE SIGNED
SUBSCRIPTION DOCUMENTS.

      

      2.           
Payment.

      

      Payment
of the purchase price may be made by check payable to “Signature Bank, as Escrow
Agent for Image Metrics,” or by wire transfer of immediately available funds,
contemporaneously with the execution and delivery of the Subscription Agreement,
to Signature Bank as follows:

      

      Wire Transfer Instructions
for Escrow Account

      

      Signature
Bank

      261
Madison Avenue

      New York,
New York 10016

      ABA #
026-013-576

      Account #
______________

      For
credit to: Signature Bank, as Escrow Agent for Image Metrics

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      

      3.            Return of Documents and
Checks.

      

      Copies of
the signed Subscription Agreement and Investor Questionnaire, and checks if
payment is being made by check, should be delivered to either of the following
Placement Agents:

      

      
        
          
            	
                    Broadband
      Capital

                  	 
      	
                    Joseph
      Gunnar & Co.,

                  
	
                    Management
      LLC

                  	 
      	
                    LLC

                  
	
                    712
      Fifth Avenue

                  	 
      	
                    30
      Broad Street, 11th Floor

                  
	
                    New
      York, New York 10019

                  	 
      	
                    New
      York, New York

                  
	
                    Phone:
      (212) 277-5301

                  	 
      	
                    10004

                  
	 
      	 
      	
                    Phone:
      (212) 440-9650

                  
	
                    Michael
      Rapp

                  	 
      	 
      
	
                    Chairman

                  	 
      	
                    Stephen
      A. Stein

                  
	
                    mrapp@broadbandcapital.com

                  	 
      	
                    President

                  
	 
      	 
      	
                    sstein@jgunnar.com

                  
	 	 	 
	
                    *

                  	
                    *

                  	
                    *

                  

          

        

      

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      

      NAME OF
SUBSCRIBER:_____________________________

      

      To:         Image
Metrics

      1918 Main
Street, 2nd
Floor

      Santa
Monica, California 90405

      

      SUBSCRIPTION
AGREEMENT

      

      This
Subscription Agreement (this “Agreement”)
is being delivered to you in connection with your investment in a
publicly-traded company, which will subsequently change its name to Image
Metrics, Inc. (“Pubco”),
and the concurrent acquisition by exchange offer (the “Exchange
Offer”) by Pubco of all of the outstanding ordinary and preferred shares
of Image Metrics Limited, a private company incorporated in England and Wales.
Broadband Capital Management LLC and Joseph Gunnar & Co., LLC (together, the
“Placement
Agents”) shall serve as co-placement agents of Pubco in conducting a
private placement (the “Offering”)
of units (“Units”),
each Unit consisting of (i) one share of Pubco’s Series A Convertible Preferred
Stock (“Preferred
Stock”), convertible into one share of Pubco’s common stock (“Common
Stock”), and (ii) a detachable warrant to purchase one-half share of
Common Stock (“Warrants”),
at an exercise price of $1.50 per share. The purchase price per Unit is $1.00.
The Offering is being conducted on a “best efforts – 8,000,000 Units or none”
basis with a maximum of 12,800,000 Units being offered. All funds received in
the Offering shall be promptly transmitted to and deposited in a special
non-interest bearing escrow account at Signature Bank, New York, New York (the
“Escrow
Agent”) and, upon completion of the Exchange Offer and the other
conditions precedent set forth herein, shall be released from escrow and
delivered to Pubco at which time the securities subscribed for as further
described below shall be delivered, subject to Section 8 hereof, to you. The
Company and the Placement Agents may continue to offer and sell Units and
conduct additional closings (each, a “Closing”)
for the sale of additional Units after the Initial Closing until the termination
of the Offering.

      

      1.           
SUBSCRIPTION AND
PURCHASE PRICE

      

      1.1    
      Subscription.
Subject to the conditions set forth in Section 2 hereof, the undersigned hereby
subscribes for and agrees to purchase the number of Units indicated on page F-10
hereof on the terms and conditions described herein. The minimum number of Units
that may be purchased is 50,000. Subscriptions for lesser amounts may be
accepted at the sole discretion of Pubco and the Placement Agents.

      

      1.2   
       Purchase
of Securities. The undersigned understands and acknowledges that the
purchase price to be remitted to the Placement Agents in exchange for the Units
shall be $1.00 per Unit, for an aggregate purchase price as set forth on page 10
hereof (the “Aggregate
Purchase Price”).  The undersigned’s delivery of this Agreement
to the Placement Agents shall be accompanied by payment for the Units subscribed
for hereunder, payable in United States dollars, by check or wire transfer, to
“Signature Bank, as Escrow Agent for Image Metrics,” with the undersigned’s
delivery of this Agreement to the Placement Agents. The undersigned understands
and agrees that, subject to Section 2.1(a) and applicable laws, by executing
this Agreement, he, she or it is entering into a binding agreement.

      

      2.           
ACCEPTANCE AND
CLOSING PROCEDURES

      

      2.1      
    Acceptance
or Rejection.

      

      (a)          The
obligation of the undersigned to purchase the Units shall be irrevocable, and
the undersigned shall be legally bound to purchase the Units subject to the
terms set forth in this Agreement.

      

      (b)          The
undersigned understands and agrees that Pubco and the Placement Agents reserve
the right to reject this subscription for the Units in whole or part in any
order at any time prior to the closing (the “Closing”)
of the purchase and sale of the Units for any or no reason, notwithstanding the
undersigned’s prior receipt of notice of acceptance of the undersigned’s
subscription.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

      (c)          In
the event of rejection of this subscription by Pubco or the Placement Agents in
accordance with Section 2.1(b), or the sale of the Units is not consummated by
the Placement Agents for any reason, this Agreement and any other agreement
entered into between the undersigned and Pubco relating to this subscription
shall thereafter have no force or effect, and the Placement Agents shall
promptly return or cause to be returned to the undersigned the purchase price
remitted to the Escrow Agent, without interest thereon or deduction
therefrom.

      

      
        2.2          Closing.

      

      

      Each
Closing shall take place at the offices of Greenberg Traurig, LLP, counsel to
Pubco, at 200 Park Avenue, 15th Floor, New York, New York 10166, or such other
place as determined by the Placement Agents. The Initial Closing shall take
place on a Business Day promptly following the satisfaction of the conditions
set forth in Section 8 below. Each subsequent Closing shall take place at such
times as determined by Pubco (each closing date referred to as a “Closing
Date”), or such other date as is mutually agreed to by the parties and
the undersigned. “Business
Day” shall mean from the hours of 9:00 a.m., Eastern time, through 5:00
p.m., Eastern time, of a day other than a Saturday, Sunday or other day on which
commercial banks in New York, New York or London, England are authorized or
required to be closed.

      

      3.        
   INVESTOR’S REPRESENTATIONS AND WARRANTIES

      

      The
undersigned hereby acknowledges, agrees with and represents and warrants to
Pubco and the Placement Agents, as follows:

      

      3.1       The
undersigned has full right, power and authority, without the necessity of any
consent or approval of any other person or entity, to enter into and perform
his, her or its obligations under this Agreement, the execution and delivery of
which has been duly authorized, if applicable, and this Agreement constitutes
the undersigned’s valid, legal and binding obligation, enforceable against the
undersigned in accordance with its terms. The performance of the undersigned’s
obligations hereunder will not constitute a breach or violation of, or conflict
with, any agreement, commitment or other obligation to which the undersigned is
a party or by which the undersigned is bound.

      

      3.2       The
undersigned acknowledges his, her or its understanding that the offering and
sale of the Units is intended to be exempt from registration under the
Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section
4(2) of the Securities Act and the provisions of Regulation D promulgated
thereunder (“Regulation
D”). In furtherance thereof, the undersigned represents and warrants to
Pubco and the Placement Agents as follows:

      

      (a)          The
undersigned realizes that the basis for the exemption from registration may not
be available if, notwithstanding the undersigned’s representations contained
herein, the undersigned is merely acquiring the Units for a fixed or
determinable period in the future, or for a market rise, or for sale if the
market does not rise.  The undersigned does not have any such
intention;

      

      (b)          The
undersigned is acquiring the Units solely for the undersigned’s own beneficial
account, for investment purposes, and not with view to, or resale in connection
with, any distribution of the shares of Preferred Stock, or shares of Common
Stock into which the Preferred Stock is convertible and the Warrants are
exercisable;

      

      (c)          The
undersigned has the financial ability to bear the economic risk of his, her or
its investment, has adequate means for providing for his, her or its current
needs and contingencies, and has no need for liquidity with respect to the
investment in Pubco;

      

      (d)          The
undersigned and the undersigned’s attorney, accountant, purchaser representative
and/or tax advisor, if any (collectively, “Advisors”),
have received the Confidential Private Placement Memorandum, dated January 26,
2010, together with all appendices thereto (as such documents may be amended or
supplemented, the “Memorandum”),
relating to the private placement by Pubco of the Units, and all other documents
requested by the undersigned or Advisors, if any, have carefully reviewed them
and understand the information contained therein, prior to the execution of this
Agreement; and

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      

      (e)          The
undersigned (together with his, her or its Advisors, if any) has such knowledge
and experience in financial and business matters as to be capable of evaluating
the merits and risks of the prospective investment in the Units.  If
other than an individual, the undersigned also represents it has not been
organized solely for the purpose of acquiring the Units.

      

      3.3     
    The information in the Investor Questionnaire completed
and executed by the undersigned (the “Investor
Questionnaire”) is true and accurate in all respects, and the undersigned
is an “accredited investor,” as that term is defined in Rule 501(a) of
Regulation D.

      

      3.4       
  The undersigned is not relying on the Placement Agents or their
respective affiliates or sub-agents with respect to economic considerations
involved in this investment. The undersigned has relied on the advice of, or has
consulted with, only his Advisors. Each Advisor, if any, is capable of
evaluating the merits and risks of an investment in the Units as such are
described in the Memorandum, and each Advisor, if any, has disclosed to the
undersigned in writing (a copy of which is annexed to this Agreement) the
specific details of any and all past, present or future relationships, actual or
contemplated, between the Advisor and the Placement Agents or any respective
affiliate or sub-agent thereof.

      

      3.5      
   The undersigned represents, warrants and agrees that he, she
or it will not sell or otherwise transfer the Units, the shares of Preferred
Stock or Warrants (including such shares of Common Stock into which the
Preferred Stock is convertible and Warrants are exercisable, and collectively
with the Units, Preferred Stock and Warrants, the “Securities”)
without registration under the Securities Act or an exemption therefrom, and
fully understands and agrees that the undersigned must bear the economic risk of
his, her or its purchase because, among other reasons, the Securities have not
been registered under the Securities Act or under the securities laws of any
state and, therefore, cannot be resold, pledged, assigned or otherwise disposed
of unless they are subsequently registered under the Securities Act and under
the applicable securities laws of such states, or an exemption from such
registration is available. In particular, the undersigned is aware that the
Securities are “restricted securities,” as such term is defined in Rule 144
promulgated under the Securities Act (“Rule
144”), and they may not be sold pursuant to Rule 144 unless all of the
conditions of Rule 144 are met. The undersigned also understands that, except as
otherwise provided herein, Pubco is under no obligation to register the
Securities on his, her or its behalf or to assist them in complying with any
exemption from registration under the Securities Act or applicable state
securities laws.  The undersigned understands that any sales or
transfers of the Securities are further restricted by state securities laws and
the provisions of this Agreement.

      

      3.6      
   No representations or warranties have been made to the
undersigned by Pubco, Image Metrics Limited or the Placement Agents, or any of
their respective officers, employees, agents, sub-agents, affiliates or
subsidiaries, other than any representations of Pubco contained herein and in
the Memorandum, and in subscribing for Units the undersigned is not relying upon
any representations other than those contained herein or in the
Memorandum.

      

      3.7     
    The undersigned understands and acknowledges that his,
her or its purchase of the Units is a speculative investment that involves a
high degree of risk and the potential loss of their entire investment and has
carefully read and considered the matters set forth in the Memorandum and in
particular the matters under the caption “Cautionary Language Regarding
Forward-Looking Statements and Industry Data” and “Risk Factors” therein, and,
in particular, acknowledges that Image Metrics Limited provides facial animation
services in the highly competitive interactive entertainment and film
industries, and has a limited financial and operating history for purposes of
assessing its future financial results, including its ability to ever generate
significant revenue or have profits.

      

      3.8      
   The undersigned’s overall commitment to investments that are
not readily marketable is not disproportionate to the undersigned’s net worth,
and an investment in the Units will not cause such overall commitment to become
excessive.

      

      3.9      
   The undersigned understands and agrees that the certificates
for the Securities shall bear substantially the following legend until (i) such
Securities shall have been registered under the Securities Act and effectively
disposed of in accordance with a registration statement that has been declared
effective or (ii) in the opinion of counsel for Pubco such Securities may be
sold without registration under the Securities Act, as well as any applicable
“blue sky” or state securities laws:

       

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      

      THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS.  SUCH
SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES AND MAY NOT BE OFFERED FOR
SALE, SOLD, DELIVERED AFTER SALE, TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FILED BY THE ISSUER WITH THE U.S.
SECURITIES AND EXCHANGE COMMISSION COVERING SUCH SECURITIES UNDER THE SECURITIES
ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION
IS NOT REQUIRED.

      

      3.10    
   Neither the U.S. Securities and Exchange Commission (the
“SEC”)
nor any state securities commission has approved the Units or the Securities, or
passed upon or endorsed the merits of the Offering or confirmed the accuracy or
determined the adequacy of the Memorandum. The Memorandum has not been reviewed
by any Federal, state or other regulatory authority.

      

      3.11      
 The undersigned and his, her or its Advisors, if any, have had a
reasonable opportunity to ask questions of and receive answers from a person or
persons acting on behalf of Pubco and Image Metrics Limited concerning the
offering of the Units and the business, financial condition, results of
operations and prospects of Pubco, and all such questions have been answered to
the full satisfaction of the undersigned and his, her or its Advisors, if
any.

      

      3.12    
   The undersigned is unaware of, is in no way relying on, and
did not become aware of the offering of the Units through or as a result of, any
form of general solicitation or general advertising including, without
limitation, any article, notice, advertisement or other communication published
in any newspaper, magazine or similar media or broadcast over television, radio
or electronic mail through the Internet, in connection with the offering and
sale of the Units and is not subscribing for Units and did not become aware of
the offering of the Units through or as a result of any seminar or meeting to
which the undersigned was invited by, or any solicitation of a subscription by,
a person not previously known to the undersigned in connection with investments
in securities generally.

      

      3.13     
  The undersigned has taken no action which would give rise to any
claim by any person for brokerage commissions, finders’ fees or the like
relating to this Agreement or the transactions contemplated hereby (other than
commissions to be paid by Pubco to the Placement Agents, their respective
sub-agents or as otherwise described in the Memorandum) and, in turn, to be paid
to other selected dealers.

      

      3.14     
  The undersigned is not relying on Pubco, the Placement Agents or any
of their respective employees, agents or sub-agents with respect to the legal,
tax, economic and related considerations of an investment in the Units, and the
undersigned has relied on the advice of, or has consulted with, only his, her or
its own Advisors.

      

      3.15       
The undersigned acknowledges that any estimates or forward-looking statements or
projections included in the Memorandum were prepared by the future management of
Pubco in good faith, but that the attainment of any such projections, estimates
or forward-looking statements cannot be guaranteed by Pubco or its management
and should not be relied upon.

      

      3.16     
  No oral or written representations have been made, or oral or
written information furnished, to the undersigned or his, her or its Advisors,
if any, in connection with the offering of the Units which are in any way
inconsistent with the information contained in the Memorandum.

      

      3.17     
  The undersigned’s substantive relationship with one or both of the
Placement Agents or their respective sub-agents through which the undersigned is
subscribing for Units predates such Placement Agent’s or such sub-agent’s
contact with the undersigned regarding an investment in the Units.

      

      3.18    
    The undersigned acknowledges that the foregoing
representations, warranties and agreements shall be relied upon by Pubco and the
Placement Agents in conducting the Offering and shall survive the
Closing.

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

      

      4. 
         THE COMPANY’S
REPRESENTATIONS AND WARRANTIES

      

      Except as
set forth in the Memorandum, the Company (which means each of Image Metrics and
Pubco prior to the closing of the Exchange Offer and their respective
subsidiaries, if any (as defined in the Memorandum), and the combined entity
after giving effect to the closing of the Exchange Offer and their respective
subsidiaries, if any) hereby acknowledges, represents and warrants to each of
the undersigned, as follows:

      

      4.1   
      Organization
and Qualification.  The Company is an entity duly incorporated
or otherwise organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation or organization, with the requisite power
and authority to own and use its properties and assets and to carry on its
business as currently conducted.  The Company is not in violation of
any of the provisions of its certificate or articles of incorporation, bylaws or
other organizational or charter documents. The Company is duly qualified to
conduct business and is in good standing as a foreign corporation in each
jurisdiction in which the nature of the business conducted or property owned by
it makes such qualification necessary, except where the failure to be so
qualified or in good standing, as the case may be, would not have or reasonably
be expected to result in (i) a material adverse effect on the legality, validity
or enforceability of this Agreement, (ii) a material adverse effect on the
results of operations, assets, business or financial condition of the Company,
or (iii) adversely impair the Company’s ability to perform in any material
respect on a timely basis its obligations under this Agreement (any of (i), (ii)
or (iii), a “Material
Adverse Effect”).

      

      4.2        
 Authorization;
Enforcement. The Company has the requisite corporate power and authority
to enter into and to consummate the transactions contemplated by this Agreement
and otherwise to carry out its obligations hereunder. The execution and delivery
of this Agreement by the Company and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary action on the
part of the Company and no further action is required by the Company in
connection herewith. This Agreement has been (or upon delivery will have been)
duly executed by the Company and, when delivered in accordance with the terms
hereof, will constitute the valid and binding obligation of the Company
enforceable against the Company in accordance with its terms except: (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of creditors’ rights
generally and (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies.

      

      4.3     
    No
Conflicts. The execution, delivery and performance of this Agreement by
the Company and the consummation by the Company of the transactions contemplated
hereby do not and will not: (i) conflict with or violate any provision of the
Company’s certificate or articles of incorporation, bylaws or other
organizational or charter documents, or (ii) conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both) of,
any agreement, credit facility, debt or other instrument (evidencing a Company
debt or otherwise) or other understanding to which the Company is a party or by
which any property or asset of the Company is bound or affected, or (iii) result
in a violation of any law, rule, regulation, order, judgment, injunction, decree
or other restriction of any court or governmental authority to which the Company
is subject (including federal and state securities laws and regulations), or by
which any property or asset of the Company is bound or affected; except in the
case of each of clauses (ii) and (iii), such as would not have or reasonably be
expected to result in a Material Adverse Effect.

      

      4.4     
     Filings,
Consents and Approvals. The Company is not required to obtain any
consent, waiver, authorization or order of, give any notice to, or make any
filing or registration with, any court or other foreign, federal, state, local
or other governmental authority or other person in connection with the
execution, delivery and performance by the Company of this Agreement, other than
(a) the filing with the SEC of the Registration Statement and applicable blue
sky filings, (b) such as have already been obtained or such exemptive filings as
are required to be made under applicable securities laws, (c) such other filings
that have been made pursuant to applicable state securities laws and post-sale
filings pursuant to applicable state and federal securities laws which the
Company undertakes to file within the applicable time periods. Subject to the
accuracy of the representations and warranties of each Investor set forth in
Section 3 hereof, the Company has taken all action necessary to exempt: (i) the
issuance and sale of the Securities, (ii) the issuance of the Common Stock upon
conversion of the Preferred Stock and exercise of the Warrants, and (iii) the
other transactions contemplated by the transaction documents from the provisions
of any stockholder rights plan or other “poison pill” arrangement, any
anti-takeover, business combination or control share law or statute binding on
the Company or to which the Company or any of its assets and properties may be
subject and any provision of the Company’s Articles of Incorporation or By-laws
that is or could reasonably be expected to become applicable to the Investors as
a result of the transactions contemplated hereby, including without limitation,
the issuance of the Securities and the ownership, disposition or voting of the
Securities by the Investors or the exercise of any right granted to the
Investors pursuant to this Agreement.

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      

      4.5      
   Issuance
of the Securities. The shares of Preferred Stock are duly authorized and,
when issued and paid for in accordance with this Agreement, will be duly and
validly issued, fully paid and nonassessable, free and clear of all
Liens.  The Warrants have been duly and validly
authorized.  Upon the due conversion of the Preferred Stock, the
underlying Common Stock will be validly issued, fully paid and non-assessable
free and clear of any and all liens, pledges, security interests, encumbrances
or other adverse claims or interests of any kind whatsoever (collectively,
“Liens”).
Upon the due exercise of the Warrants, the underlying Common Stock will be
validly issued, fully paid and non-assessable free and clear of all Liens. The
Company has reserved from its duly authorized capital stock the maximum number
of shares of Common Stock issuable pursuant to this Agreement, the Preferred
Stock and the Warrants.

      

      4.6       
  Capitalization.  The
Memorandum accurately sets forth the number of shares of capital stock issued
and to be issued by the Company as of the Closing Date. All of the issued and
outstanding shares of the Company’s capital stock have been duly authorized and
validly issued and are fully paid, nonassessable and free of pre-emptive rights
and were issued in full compliance with applicable state and federal securities
law and any rights of third parties. No person has any right of first refusal,
preemptive right, right of participation, or any similar right to participate in
the transactions contemplated by this Agreement. There are no outstanding
options, warrants, script rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities, rights or obligations
convertible into or exchangeable for, or giving any Person any right to
subscribe for or acquire, any shares of Common Stock, or contracts, commitments,
understandings or arrangements by which the Company is or may become bound to
issue additional shares of Common Stock, or securities or rights convertible or
exchangeable into shares of Common Stock, other than in connection with the
Exchange Offer and the Company’s stock option plans. The issue and sale of the
Securities will not obligate the Company to issue shares of Common Stock or
other securities to any person (other than the Investors) and will not result in
a right of any holder of Company securities to adjust the exercise, conversion,
exchange or reset price under such securities. There are no voting agreements,
buy-sell agreements, option or right of first purchase agreements or other
agreements of any kind among the Company and any of the securityholders of the
Company relating to the securities of the Company held by them. No person has
the right to require the Company to register any securities of the Company under
the Securities Act, whether on a demand basis or in connection with the
registration of securities of the Company for its own account or for the account
of any other person.

      

      4.7      
   SEC
Reports; Financial Statements.  Pubco has filed all reports and
registration statements required to be filed by it under the Securities Act and
the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
two years preceding the date hereof (or such shorter period as the Company was
required by law to file such material) (the foregoing materials, including the
exhibits thereto, being collectively referred to herein as the “SEC
Reports” and, together with the Memorandum, the “Disclosure
Materials”) on a timely basis or has received a valid extension of such
time of filing and has filed any such SEC Reports prior to the expiration of any
such extension. As of their respective dates, the SEC Reports complied in all
material respects with the requirements of the Securities Act and the Exchange
Act and the rules and regulations of the SEC promulgated thereunder, and none of
the SEC Reports, when filed, 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.  The financial statements of the
Company included in the SEC Reports comply in all material respects with
applicable accounting requirements and the rules and regulations of the SEC with
respect thereto as in effect at the time of filing. Such financial statements
have been prepared in accordance with generally accepted accounting principles
applied on a consistent basis during the periods involved in the United States
(“GAAP”),
except as may be otherwise specified in such financial statements or the
Securities thereto and except that unaudited financial statements may not
contain all footnotes required by United States GAAP, and fairly present in all
material respects the financial position of the Company and its consolidated
subsidiaries as of and for the dates thereof and the results of operations and
cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments. The financial
statements of Image Metrics included in the Memorandum have been prepared in
accordance with United States GAAP, except as may be otherwise specified in such
financial statements or the Securities thereto and except that unaudited
financial statements may not contain all footnotes required by United States
GAAP, and fairly present in all material respects the financial position of
Image Metrics and its consolidated subsidiaries as of and for the dates thereof
and the results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal, immaterial, year-end
audit adjustments.

       

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      

      4.8      
   Litigation.  There
is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of the Company, threatened against or affecting the
Company, or any of their respective properties before or by any court,
arbitrator, governmental or administrative agency or regulatory authority
(federal, state, county, local or foreign) (collectively, an “Action”)
which: (i) adversely affects or challenges the legality, validity or
enforceability of this Agreement or the Securities or (ii) could, if there were
an unfavorable decision, have or reasonably be expected to result in a Material
Adverse Effect. Neither the Company nor any director or officer thereof is or
has been the subject of any Action involving a claim of violation of or
liability under federal or state securities laws or a claim of breach of
fiduciary duty. There has not been, and to the knowledge of the Company, there
is not pending or contemplated, any investigation by the SEC involving the
Company or any current or former director or officer of the Company. The SEC has
not issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company under the Exchange Act or the
Securities Act.

      

      4.9      
   Labor
Relations.  The Company is not a party to or bound by any
collective bargaining agreements or other agreements with labor organizations.
The Company has not violated in any material respect any laws, regulations,
orders or contract terms, affecting the collective bargaining rights of
employees, labor organizations or any laws, regulations or orders affecting
employment discrimination, equal opportunity employment, or employees’ health,
safety, welfare, wages and hours. No material labor dispute exists or, to the
knowledge of the Company, is imminent with respect to any of the employees of
the Company which could reasonably be expected to result in a Material Adverse
Effect.

      

      4.10   
    Compliance.  The
Company: (i) is not in default under or in violation of (and no event has
occurred that has not been waived that, with notice or lapse of time or both,
would result in a default by the Company under), or has the Company received
notice of a claim that it is in default under or that it is in violation of, any
indenture, loan or credit agreement or any other agreement or instrument to
which it is a party or by which it or any of its properties is bound (whether or
not such default or violation has been waived), (ii) is in violation of any
order of any court, arbitrator or Governmental Body, or (iii) is or has been in
violation of any statute, rule or regulation of any governmental authority,
including without limitation all foreign, federal, state and local laws
applicable to its business, except in the case of clauses (i), (ii) and (iii) as
would not have or reasonably be expected to result in a Material Adverse
Effect.

      

      4.11   
    Regulatory
Permits. The Company possesses all certificates, authorizations and
permits issued by the appropriate federal, state, local or foreign regulatory
authorities necessary to conduct their respective businesses as described in the
SEC Reports and the Memorandum, except where the failure to possess such permits
would not have or reasonably be expected to result in a Material Adverse Effect
(“Material
Permits”), and the Company has not received any notice of proceedings
relating to the revocation or modification of any Material Permit.

      

      4.12    
   Title
to Assets. The Company has good and marketable title in fee simple to all
real property owned by it that is material to the business of the Company and
good and marketable title in all personal property owned by it that is material
to the business of the Company, in each case free and clear of all Liens, except
for Liens as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property
by the Company and Liens for the payment of federal, state or other taxes, the
payment of which is neither delinquent nor subject to penalties.  Any
real property and facilities held under lease by the Company are held by it
under valid, subsisting and enforceable leases of which the Company is in
compliance.

      

      4.13  
     Material
Contracts.

      

      (a)          The
Company has not violated or breached, or committed any default under, any
agreement, contract or instrument which it has entered into and is material to
it in its business (collectively, the “Material
Contracts”) in any material respect, and, to the Company’s knowledge, no
other person has violated or breached, or committed any default under any
Material Contract, except for violations, breaches of defaults which would not
have a Material Adverse Effect; and

      

      (b)          To
the Company's knowledge, no event has occurred, and no circumstance or condition
exists, that (with or without notice or lapse of time) will, or would reasonably
be expected to: (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 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, except, in each case, as would not have a Material Adverse
Effect.

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      

      4.14        Taxes.

      

      (a)          The
Company has timely and properly filed all applicable local, state, federal and
foreign tax returns required to be filed by it for all years and periods (and
portions thereof) for which any such tax returns were due, except where the
failure to so file would not have a Material Adverse Effect. All such filed tax
returns are accurate in all material respects. The Company has timely paid all
applicable local, state, federal and foreign taxes due and payable (whether or
not shown on filed tax returns), except where the failure to so pay would not
have a Material Adverse Effect.  There are no pending assessments,
asserted deficiencies or claims for additional local, state, federal and foreign
taxes that have not been paid. The reserves for taxes, if any, reflected in the
SEC Reports or in the Memorandum are adequate, and there are no Liens for taxes
on any property or assets of the Company (other than Liens for taxes not yet due
and payable). There have been no audits or examinations of any tax returns by
any Governmental Body, and the Company has not received any notice that such
audit or examination is pending or contemplated. No claim has been made by any
governmental or regulatory authority, agency or commission (a “Governmental
Body”) in a jurisdiction where the Company does not file tax returns that
it is or may be subject to taxation by that jurisdiction. To the knowledge of
the Company, no state of facts exists or has existed which would constitute
grounds for the assessment of any penalty or any further tax liability beyond
that shown on the respective tax returns. There are no outstanding agreements or
waivers extending the statutory period of limitation for the assessment or
collection of any tax.

      

      (b)          The Company is not a party to any
tax-sharing agreement or similar arrangement with any other
person.

      

      (c)          The
Company has made all necessary
disclosures required by Treasury Regulation Section 1.6011-4.  The
Company has not been a participant in a “reportable transaction” within the
meaning of Treasury Regulation Section 1.6011-4(b).

      

      (d)          No
payment or benefit paid or provided, or to be paid or provided, to current or
former employees, directors or other service providers of the Company will fail
to be deductible for federal income tax purposes under Section 280G of the
Internal Revenue Code of 1986, as amended (the “Code”).

      

      4.15        Employees.

      

      (a)          The
Company is not party to any collective bargaining agreements and, to the
Company’s knowledge, there are no attempts to organize the employees of the
Company.

      

      (b)          Each
person who performs services for the Company has been, and is, properly
classified by the Company as an employee or an independent
contractor.

      

      (c)          To
the Company's knowledge, no employee or advisor of the Company is or is alleged
to be in violation of any term of any employment contract, disclosure agreement,
proprietary information and inventions agreement or any other contract or
agreement or any restrictive covenant or any other common law obligation to a
former employer relating to the right of any such employee to be employed by the
Company because of the nature of the business conducted or to be conducted by
the Company or to the use of trade secrets or proprietary information of others,
and the employment of the employees of the Company does not subject the Company
or the Company's stockholders to any liability.  There is neither
pending nor, to the Company's knowledge, threatened any actions, suits,
proceedings or claims, or, to the Company’s knowledge, any basis therefor or
threat thereof with respect to any contract, agreement, covenant or obligation
referred to in the preceding sentence.

      

      4.16        Patents
and Trademarks. To the knowledge of the Company, the Company has, or has
rights to use, all patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, licenses and other similar
rights that are necessary or material for use in connection with its business as
described in the Memorandum and which the failure to so have could have or
reasonably be expected to result in a Material Adverse Effect (collectively, the
“Intellectual
Property Rights”). The Company has not received a written notice that the
Intellectual Property Rights used by the Company violates or infringes upon the
rights of any person. To the knowledge of the Company, all such Intellectual
Property Rights are enforceable.  The Company has taken reasonable
steps to protect the Company’s rights in its Intellectual Property Rights and
confidential information (the “Confidential
Information”).  Each employee, consultant and contractor who
has had access to Confidential Information which is necessary for the conduct of
Company’s business as currently conducted or as currently proposed to be
conducted has executed an agreement to maintain the confidentiality of such
Confidential Information and has executed appropriate agreements that are
substantially consistent with the Company’s standard forms
thereof.  Except under confidentiality obligations, there has been no
material disclosure of any of the Company’s Confidential Information to any
third party.

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      

      4.17          Environmental
Matters.  The Company is not in violation of any statute, rule,
regulation, decision or order of any Governmental Body relating to the use,
disposal or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, “Environmental
Laws”), owns or operates any real property contaminated with any
substance that is subject to any Environmental Laws, is liable for any off-site
disposal or contamination pursuant to any Environmental Laws, or is subject to
any claim relating to any Environmental Laws, which violation, contamination,
liability or claim has had or could reasonably be expected to have a Material
Adverse Effect, individually or in the aggregate; and there is no pending or, to
the Company’s knowledge, threatened investigation that might lead to such a
claim.

      

      4.18          Insurance.  The
Company is insured by insurers of recognized financial responsibility against
such losses and risks and in such amounts as are prudent and customary in the
business in which the Company is engaged as described in the Memorandum. The
Company has no 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
without a significant increase in cost.

      

      4.19          Transactions
With Affiliates and Employees. None of the officers or directors of the
Company and, to the knowledge of the Company, none of the employees of the
Company is presently a party to any transaction with the Company (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement providing for the furnishing of services to or
by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to the
knowledge of the Company, any entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner, in each case in excess of $120,000 other than (a) for payment of salary
or consulting fees for services rendered, (b) reimbursement for expenses
incurred on behalf of the Company and (c) for other employee benefits, including
stock option agreements under any stock option plan of the Company.

      

      4.20          Private
Placement. Assuming the accuracy of the Investors’ representations and
warranties set forth in Section 3, no registration under the Securities Act is
required for the offer and sale of the Securities by the Company to the
Investors as contemplated hereby.  The information contained in the
Memorandum is true and correct in all material respects as of its
date.

      

      4.21          No
Integrated Offering.  Other than in connection with the
Exchange Offer, 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 of any security or solicited any offers to buy any security, under
circumstances that would cause this offering of the Securities to be integrated
with prior offerings by the Company for purposes of the Securities Act or any
applicable shareholder approval provisions, including, without limitation, under
the rules and regulations of any exchange or automated quotation system on which
any of the securities of the Company are listed or designated.

      

      4.22          Brokers
and Finders. No person will have, as a result of the transactions
contemplated by this Agreement, any valid right, interest or claim against or
upon the Company for any commission, fee or other compensation pursuant to any
agreement, arrangement or understanding entered into by or on behalf of the
Company.

      

      4.23          No
Directed Selling Efforts or General Solicitation.  Neither the
Company nor any person acting on its behalf has conducted any general
solicitation or general advertising (as those terms are used in Regulation D) in
connection with the offer or sale of any of the Securities.

      

      4.24          Questionable
Payments. To
the Company’s knowledge, neither the Company nor any of its current or former
stockholders, directors, officers, employees, agents or other persons acting on
behalf of the Company, has on behalf of the Company or in connection with its
business: (a) used any corporate funds for unlawful contributions, gifts,
entertainment or other unlawful expenses relating to political activity; (b)
made any direct or indirect unlawful payments to any governmental officials or
employees from corporate funds; (c) established or maintained any unlawful or
unrecorded fund of corporate monies or other assets; (d) made any false or
fictitious entries on the books and records of the Company; or (e) made any
unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful
payment of any nature.

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      

      4.25        Related
Party Transactions. (a) None of the Company or any of its affiliates,
officers, directors, stockholders or employees, or any affiliate of any of such
person, has any material interest in any property, real or personal, tangible or
intangible, including the Company’s Intellectual Property used in or pertaining
to the business of the Company, except for the normal rights of a stockholder,
or, to the knowledge of the Company, any supplier, distributor or customer of
the Company, (b) there are no agreements, understandings or proposed
transactions between the Company and any of its officers, directors, employees,
affiliates, or, to the Company's knowledge, any affiliate thereof, (c) to the
Company’s knowledge, no employee, officer or director of the Company has any
direct or indirect ownership interest in any firm or corporation with which the
Company is affiliated or with which the Company has a business relationship, or
any firm or corporation that competes with the Company; (d) to the Company’s
knowledge, no member of the immediate family of any officer or director of the
Company is directly or indirectly interested in any Material Contract or (e)
there are no amounts owed (cash and stock) to officers, directors and
consultants (salary, bonuses or other forms of compensation).

      

      4.26        Foreign
Corrupt Practices Act. None of the Company, nor to the knowledge of the
Company, any agent or other person acting on behalf of the Company, has,
directly or indirectly: (a) used any funds, or will use any proceeds from the
sale of the Securities, for unlawful contributions, gifts, entertainment or
other unlawful expenses related to foreign or domestic political activity, (b)
made any unlawful payment to foreign or domestic government officials or
employees or to any foreign or domestic political parties or campaigns from
corporate funds, (c) failed to disclose fully any contribution made by the
Company (or made by any person acting on its behalf of which the Company is
aware) or any members of their respective management which is in violation of
any Legal Requirement, or (d) has violated in any material respect any provision
of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and
regulations thereunder which was applicable to the Company.

      

      4.27        PFIC.  The
Company is not, nor intends to become, a “passive foreign investment company”
within the meaning of Section 1297 of the Code of 1986.

      

      4.28        OFAC.
To the knowledge of the Company, neither the Company nor any director, officer,
agent, employee, affiliate or person acting on behalf of the Company, is
currently subject to any U.S. sanctions administered by the Office of Foreign
Assets Control of the U.S. Treasury Department (“OFAC”);
and the Company will not directly or indirectly use the proceeds of the sale of
the Securities, or lend, contribute or otherwise make available such proceeds to
any of the Company’s subsidiaries, joint venture partner or other person or
entity, towards any sales or operations in Cuba, Iran, Syria, Sudan, Myanmar or
any other country sanctioned by OFAC or for the purpose of financing the
activities of any person currently subject to any U.S. sanctions administered by
OFAC.

      

      5.         
  COVENANTS

      

      5.1          Registration
Rights.

      

      (a)          Pubco
shall file a registration statement (the “Registration
Statement”) with the SEC covering the resale of the shares of Common
Stock into which the Preferred Stock is convertible and the Warrants are
exercisable (the “registrable
shares”) on or around, but no later than, 90 days after the Closing Date.
Pubco shall use its best efforts to have the Registration Statement declared
effective by the SEC as soon as practicable after the initial filing, but in any
event not later than 270 days after the Closing Date (or 300 days in the event
of a full review by the SEC of the Registration Statement), and agrees to use
its commercially reasonable best efforts to respond to any SEC comments or
questions regarding the Registration Statement on or prior to the date which is
20 business days from the date such comments or questions are received, but in
any event not later than 30 business days from the date such comments or
questions are received.  Pubco will maintain the effectiveness of the
Registration Statement from the date of the effectiveness of the Registration
Statement until 18 months after that date; provided, however, that, if at
any time or from time to time after the date of effectiveness of the
Registration Statement, Pubco notifies the undersigned in writing of the
existence of a Potential Material Event (as defined below), the undersigned
shall not offer or sell any of the registrable shares, or engage in any other
transaction involving or relating to the Securities, from the time of the giving
of notice with respect to a Potential Material Event until Pubco notifies the
undersigned that such Potential Material Event either has been disclosed to the
public or no longer constitutes a Potential Material Event; provided, further
that, Pubco may not suspend the right of the undersigned pursuant to this
Section 5.1(a) for more than 60 days in the aggregate. “Potential
Material Event” means the possession by Pubco of material information
regarding a potential transaction not ripe for disclosure in a registration
statement, which shall be evidenced by determinations in good faith by the Board
of Directors of Pubco that disclosure of such information in the registration
statement would be detrimental to the business and affairs of
Pubco.

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      

      (b)          If
(i) Pubco fails to file the Registration Statement with the SEC on or prior to
90 days after the Closing Date, (ii) Pubco fails to cause the Registration
Statement to be declared effective by the SEC on or prior to 270 days (or 300
days in the event of a full review) after the Closing Date or, if earlier,
within three days after the SEC states that there will be no review or has no
further comments, (iii) Pubco fails to respond to the SEC, within 30 days after
receipt, to any questions and comments from the SEC regarding the Registration
Statement or (iv) Pubco fails to timely file its periodic reports with the SEC
in accordance with the Securities Exchange Act of 1934, as amended, Pubco shall
be obligated to pay liquidated damages in cash equal to 2% of the Aggregate
Purchase Price of the Units subscribed for by the undersigned for each month (or
portion thereof) that the Registration Statement is not so filed, effective or
responded to or Pubco fails to satisfy its periodic reporting requirements.
Notwithstanding the foregoing, (A) Pubco shall not be obligated to pay to the
undersigned pursuant to this paragraph an aggregate liquidated damages amount
greater than 12% of the Aggregate Purchase Price of the Units subscribed for by
the undersigned and (B) any such liquidated damages may be waived entirely in
the event the Board of Directors of Pubco determines that Pubco’s management has
exerted its best efforts to cause the registrable shares to be registered within
the aforementioned time periods and to remain current in filing its periodic
reports.

      

      (c)          Pubco
shall notify the undersigned at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, upon discovery that, or upon
the happening of any event as a result of which, the prospectus included in such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances then existing. At the request of the undersigned, Pubco shall also
prepare, file and furnish to the undersigned a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such shares, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing. The undersigned agrees
not to offer or sell any registrable shares covered by the Registration
Statement after receipt of such notification until the receipt of such
supplement or amendment.

      

      (d)          Pubco
may request the undersigned to furnish Pubco such information with respect to
the undersigned and the undersigned’s proposed distribution of the registrable
shares pursuant to the Registration Statement as Pubco may from time to time
reasonably request in writing or as shall be required by law or by the SEC in
connection therewith, and the undersigned agrees to furnish Pubco with such
information.

      

      (e)          Pubco
agrees to bear all SEC registration and filing fees, printing and mailing
expenses, and fees and disbursements of counsel and accountants for
Pubco.

      

      6.        
   USE OF PROCEEDS

      

      The net
proceeds of the Offering will be used in a manner consistent with the plan
described in “Use of Proceeds” in the Memorandum.

      

      7.      
     INSIDER TRADING PROHIBITION;
INDEMNITY

      

      7.1          Until
the filing by Pubco of its Current Report on Form 8-K with the SEC describing
the Exchange Offer and the Offering, the undersigned hereby agrees to (i)
refrain from (a) engaging in any transactions with respect to the capital stock
of Pubco or securities exercisable or convertible into or exchangeable for any
shares of capital stock of Pubco, and (b) entering into any transaction which
would have the same effect, or entering into any swap, hedge or other
arrangement that transfers, in whole or in part, any of the economic
consequences of ownership of the capital stock of Pubco and (ii) indemnify and
hold harmless Pubco, the Placement Agents, and their respective officers and
directors, employees, agents, sub-agents and affiliates and each other person,
if any, who controls any of the foregoing, against any loss, liability, claim,
damage and expense whatsoever (including, but not limited to, any and all
expenses whatsoever reasonably incurred in investigating, preparing or defending
against any litigation commenced or threatened or any claim whatsoever) arising
out of or based upon any violation of this Section 7(a) by the
undersigned.

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      

      7.2          The
undersigned, whether in its own capacity or through a representative, agent or
affiliate, agrees that it will not enter into or effect any “short sales” of any
Securities purchased in the Offering or any hedging, stabilization or other
similar transaction, whether on a U.S. domestic exchange or any foreign exchange
for a period commencing on the issuance of such Securities and ending one year
after the Registration Statement covering the shares of Common Stock issuable
upon conversion or exercise of the Securities sold in the Offering has been
declared effective by the SEC.

      

      7.3          The
undersigned agrees to indemnify and hold harmless Pubco, the Placement Agents,
the Escrow Agent and their respective officers and directors, employees, agents,
sub-agents, attorneys, accountants and affiliates and each other person, if any,
who controls any of the foregoing, against any loss, liability, claim, damage
and expense whatsoever (including, but not limited to, any and all expenses
whatsoever reasonably incurred in investigating, preparing or defending against
any litigation commenced or threatened or any claim whatsoever) arising out of
or based upon any false representation or warranty (or any omission which
results in any representation or warranty being false) by the undersigned, or
the undersigned’s breach of, or failure to comply with, any covenant or
agreement made by the undersigned herein or in any other document furnished by
the undersigned to Pubco, the Placement Agents, the Escrow Agent and their
respective officers and directors, employees, agents, sub-agents and affiliates
and each other person, if any, who controls any of the foregoing in connection
with the Offering.

      

      8.          
CONDITIONS TO ACCEPTANCE OF SUBSCRIPTION

      

      Pubco’s
right to accept the subscription of the undersigned is conditioned upon
satisfaction of the following conditions precedent on or before the date Pubco
accepts such subscription (any or all of which may be waived by the undersigned
in his, her or its sole discretion):

      

      8.1          On
the Closing Date, no legal, administrative or regulatory action, suit or
proceeding shall be pending which seeks to restrain or prohibit the transactions
contemplated by this Agreement.

      

      8.2          The
closing of the Exchange Offer (as defined in the introductory paragraph hereof)
shall occur concurrently with the initial closing of the Offering.

      

      8.3          The
Board of Directors of Pubco shall have approved the issuance of the Preferred
Stock and Warrants pursuant to this Agreement in accordance with the applicable
laws of the jurisdiction of Pubco’s incorporation and expressly approved the
assumption of this Agreement.

      

      8.4          Pubco
shall have expressly assumed this Agreement and the other subscription documents
in the Offering for a minimum of 8,000,000 Units and shall have indicated such
assumption by executing and delivering a counterpart of this executed Agreement
and the other subscription documents.

      

      8.5          The
representations and warranties of Pubco and Image Metrics contained in this
Agreement shall have been true and correct on the date of this Agreement and
shall be true and correct on the Closing Date as if made on the Closing
Date.

      

      8.6          The
Placement Agents shall have agreed to accept such subscription.

      

      9.          
NOTICES TO
SUBSCRIBERS

      

      9.1          THE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES
LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH LAWS. THE
SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC, ANY STATE
SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE
FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR THE
ACCURACY OR ADEQUACY OF THE MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.

       

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

      

      9.2          THE
SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT
BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT, AND
APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. SUBSCRIBERS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF
TIME.

      

      9.3          THE
DISTRIBUTION OF THE MEMORANDUM AND THE OFFER AND SALE OF THE UNITS (AND THE
SECURITIES COMPRISING THE UNITS AND THE SECURITIES INTO WHICH THE COMPONENTS OF
THE UNITS ARE CONVERTIBLE OR EXERCISABLE) MAY BE RESTRICTED BY LAW IN CERTAIN
JURISDICTIONS.  PERSONS INTO WHOSE POSSESSION THE MEMORANDUM COMES
MUST INFORM THEMSELVES ABOUT, AND OBSERVE, ANY SUCH RESTRICTIONS. NONE OF PUBCO,
IMAGE METRICS OR THE PLACEMENT AGENTS ARE MAKING ANY REPRESENTATION TO THE
POTENTIAL INVESTOR OR PURCHASER OF THE UNITS (OR THE SECURITIES COMPRISING THE
UNITS OR THE SECURITIES INTO WHICH THE COMPONENTS OF THE UNITS ARE CONVERTIBLE
OR EXERCISABLE) REGARDING THE LEGALITY OF ANY INVESTMENT THEREIN BY THE
POTENTIAL INVESTOR OR PURCHASER UNDER APPLICABLE LEGAL INVESTMENT OR SIMILAR
LAWS.

      

      10.         MISCELLANEOUS
PROVISIONS

      

      10.1         Modification.
Neither this Agreement, nor any provisions hereof, shall be waived, modified,
discharged or terminated except by an instrument in writing signed by the party
against whom any waiver, modification, discharge or termination is
sought.

      

      10.2        Survival.
The undersigned’s representations and warranties made in this Subscription
Agreement shall survive the execution and delivery of this Agreement and the
delivery of the Units, Preferred Stock and Warrants.

      

      10.3         Notices.  Any
party may send any notice, request, demand, claim or other communication
hereunder to the undersigned at the address set forth on the signature page of
this Agreement or to Pubco at the address set forth above using any means
(including personal delivery, expedited courier, messenger service, fax,
ordinary mail or electronic mail), but no such notice, request, demand, claim or
other communication will be deemed to have been duly given unless and until it actually is received by
the intended recipient. Any party may change the address to which notices,
requests, demands, claims and other communications hereunder are to be delivered
by giving the other parties written notice in the manner herein set
forth.

      

      10.4         Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original, but all of which together shall constitute one and the
same instrument.

      

      10.5         Binding
Effect. Except as otherwise provided herein, this Agreement shall be
binding upon, and inure to the benefit of, the parties to this Agreement and
their heirs, executors, administrators, successors, legal representatives and
assigns. If the undersigned is more than one person or entity, the obligation of
the undersigned shall be joint and several and the agreements, representations,
warranties and acknowledgments contained herein shall be deemed to be made by,
and be binding upon, each such person or entity and his or its heirs, executors,
administrators, successors, legal representatives and assigns.

      

      10.6         Assignability.  This
Agreement is not transferable or assignable by the undersigned.  This
Agreement shall be transferable or assignable by the Placement Agents to
Pubco.

      

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

       

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

      

      ANTI-MONEY
LAUNDERING REQUIREMENTS

      

      
        
          
            
              	 
      	 
      	 
      	 
      	
                      How
      big is the problem and

                    
	
                      The USA PATRIOT Act

                    	
                        

                    	
                      What is money laundering?

                    	
                        

                    	
                      why is it important?

                    
	
                      The
      USA PATRIOT Act is designed to detect, deter, and punish terrorists in the
      United States and abroad. The Act imposes new anti-money laundering
      requirements on brokerage firms and financial institutions. Since April
      24, 2002, all brokerage firms have been required to have new,
      comprehensive anti-money laundering programs.

                    	 
      	
                      Money
      laundering is the process of disguising illegally obtained money so that
      the funds appear to come from legitimate sources or activities. Money
      laundering occurs in connection with a wide variety of crimes, including
      illegal arms sales, drug trafficking, robbery, fraud, racketeering, and
      terrorism.

                    	 
      	
                      The
      use of the U.S. financial system by criminals to facilitate terrorism or
      other crimes could taint our financial markets. According to the U.S.
      State Department, one recent estimate puts the amount of worldwide money
      laundering activity at $1 trillion a year.

                    
	 
      	 
      	 
      	 
      	 
      
	
                      To
      help you understand theses efforts, we want to provide you with some
      information about money laundering and our steps to implement the USA
      PATRIOT Act.

                    	 
      	 
      	 
      	 
      

            

          

        

      

      

      
        
          	
                  What are we required to do to eliminate money
      laundering?  

                
	
                  Under
      new rules required by the USA PATRIOT Act, our anti-money laundering
      program must designate a special compliance officer, set up employee
      training, conduct independent audits, and establish policies and
      procedures to detect and report suspicious transactions and ensure
      compliance with the new laws.

                	 
      	
                  As
      part of our required program, we may ask you to provide various
      identification documents or other information. Until you provide the
      information or documents we need, we may not be able to effect any
      transactions for you.

                

        

      

      

      PRIVACY
POLICIES

      

      It is the
policy of each of Broadband Capital Management LLC and Joseph Gunnar & Co.,
LLC (each, a “Placement
Agent” and together, the “Placement
Agents”) to respect the privacy of customers who subscribe to
transactions placed by the Placement Agents.

      

      Whether
its own brokers introduce Customers to the Placement Agents or the introduction
was made through Selling Agents (hereinafter referred to as “Subscribers”)
non-public personal information is protected by each of the Placement
Agents.

      

      Neither
of the Placement Agents will disclose any non-public personal information about
Subscribers to anyone, except as required or permitted by law and to effect,
administer or enforce transactions requested by Subscribers in the ordinary
processing, servicing or maintaining their accounts. Furthermore, the Placement
Agents do not reserve the right to disclose Subscriber’s non-public personal
information in the future without first notifying the Subscriber of a change in
privacy policy and providing a convenient opportunity for Subscriber to opt out
of information sharing with non-affiliated third parties.

      

      Under the
USA PATRIOT Act of 2001 (Public Law 107-56)(together with all rules and
regulations promulgated hereunder, the “Patriot
Act”), the Placement Agents and/or your broker may be required or
requested to disclose to one or more regulatory and/or law enforcement bodies
certain information regarding transactions relating to your account involving
transactions with foreign entitles and individuals, other transactions in your
account as required in the Patriot Act and other activities described in the
Patriot Act as “suspicious activities.” Neither the Placement Agents nor your
broker shall have any obligation to advise you of any such disclosures or
reports made in compliance with the Patriot Act.

       

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

      

      ALL SUBSCRIBERS MUST
COMPLETE THIS PAGE

      

      IN WITNESS WHEREOF, the undersigned has
executed this Agreement on the ______ day of
____________2010.

      

      
        
          	 
      	 
      	
                  X
      $1.00 for each Unit

                	 
      	
                  =
      $_____________________.

                
	
                  Units
      subscribed for

                	
                    

                	 
      	
                    

                	
                   Aggregate
      Purchase Price

                

        

      

      

      Manner in
which Title is to be held (Please Check One):

      

      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  1.

                                	
                                   ̈

                                	
                                  Individual

                                	 
      	
                                  7

                                	
                                   ̈

                                	
                                  Trust/Estate/Pension
      or Profit sharing Plan

                                
	 
      	 
      	
                                   

                                	 
      	 
      	 
      	
                                  Date
      Opened:______________

                                
	 	 	 	 	 	 	 
	
                                  2.

                                	
                                   ̈

                                	
                                  Joint
      Tenants with Right of

                                	 
      	
                                  8

                                	
                                   ̈

                                	
                                  As
      a Custodian for

                                
	 
      	 
      	
                                  Survivorship

                                	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	
                                  Under
      the Uniform Gift to Minors Act of the

                                
	 
      	 
      	 
      	 
      	 
      	 
      	
                                  State
      of

                                
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
                                  3.

                                	
                                   ̈

                                	
                                  Community
      Property

                                	 
      	
                                  9.

                                	
                                   ̈

                                	
                                  Married
      with Separate Property

                                
	 	 	 	 	 	 	 
	
                                  4.

                                	
                                   ̈

                                	
                                  Tenants
      in Common

                                	 
      	
                                  10.

                                	
                                   ̈

                                	
                                  Keogh

                                
	 	 	 	 	 	 	 
	
                                  5.

                                	
                                   ̈

                                	
                                  Corporation/Partnership/
      Limited

                                	 
      	
                                  11.

                                	
                                   ̈

                                	
                                  Tenants
      by the Entirety

                                
	 
      	 
      	
                                  Liability
      Company

                                	 
      	 
      	 
      	 
      
	 	 	 	 	 	 	 
	
                                  6.

                                	
                                   ̈

                                	
                                  IRA

                                	 
      	 
      	 
      	 
      

                        

                      

                    

                  

                

              

            

          

        

      

      

      IF MORE
THAN ONE SUBSCRIBER, EACH SUBSCRIBER MUST SIGN.

      INDIVIDUAL
SUBSCRIBERS MUST COMPLETE PAGE 18.

      SUBSCRIBERS
WHICH ARE ENTITIES MUST COMPLETE PAGE 19.

       

      
        
           

        

        
          17

          
            

          

        

        
           

        

      

      

      
        EXECUTION BY NATURAL
PERSONS

        

      

      
        
          

        
Exact Name in Which Title is to be Held

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    Name
      (Please Print)

                                                  	 
      	
                                                    
                                                      Name
      of Additional Purchaser

                                                    

                                                  
	
                                                     

                                                  	 
      	 
      
	
                                                    Residence:
      Number and Street

                                                  	 
      	
                                                    Address
      of Additional Purchaser

                                                  
	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    City,
      State and Zip Code

                                                  	 
      	
                                                    City,
      State and Zip Code

                                                  
	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    Social
      Security Number

                                                  	 
      	
                                                    Social
      Security Number

                                                  
	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    Telephone
      Number

                                                  	 
      	
                                                    Telephone
      Number

                                                  
	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    Fax
      Number (if available)

                                                  	 
      	
                                                    Fax
      Number (if available)

                                                  
	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    E-Mail
      (if available)

                                                  	 
      	
                                                    E-Mail
      (if available)

                                                  
	
                                                     

                                                  	 
      	
                                                     

                                                  
	
                                                    (Signature)

                                                  	
                                                      

                                                  	
                                                    (Signature
      of Additional
Purchaser)

                                                  

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

      

      ACCEPTED
this ___ day of _________ 2010, on behalf of Pubco and Image
Metrics.

      

      
        	 
      	
                By:

              	 
      
	 
      	 
      	
                 Name:

              
	 
      	 
      	
                 Title:

              

      

       

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

      

      EXECUTION BY SUBSCRIBER
WHICH IS AN ENTITY

      (Corporation,
Partnership, LLC, Trust, Etc.)

      
        

      

      
        
          

        
Name of Entity (Please Print)

      

      
        	
                Date
      of Incorporation or Organization:  

              	
                    

              

      

      

      
        	
                State
      of Principal Office:

              	
                    

              

      

      

      
        	
                Federal
      Taxpayer Identification Number:

              	
                    

              

      

      

      
        
          
            
              
                
                  	
                           

                        	 
      
	
                          Office
      Address

                        	 
      
	
                           

                        	 
      
	
                          City,
      State and Zip Code

                        	 
      
	
                           

                        	 
      
	
                          Telephone
      Number

                        	 
      
	
                           

                        	 
      
	
                          Fax
      Number (if available)

                        	 
      
	
                           

                        	 
      
	
                          E-Mail
      (if available)

                        	 
      

                

              

            

          

        

      

      

      
        	 
      	
                By:

              	
                   

              
	 
      	 
      	
                Name:

              
	 
      	 
      	
                Title:

              

      

      

      
        
          
            
              
                	
                        [seal]

                      	 
      	 
      
	 
      	 
      	 
      
	
                        Attest:

                      	
                            

                      	 
      	
                            

                      
	 	
                        (If
      Entity is a Corporation)

                      	 	 
	 
      	 
      	 
      
	 
      	 
      	
                            

                      
	 
      	
                          

                      	
                        Address

                      

              

            

          

        

      

      

      ACCEPTED
this ____ day of __________ 2010, on behalf of Pubco and Image
Metrics.

      

      
        	 
      	
                By:

              	
                   

              
	 
      	 
      	
                Name:

              
	 
      	 
      	
                Title:

              

      

       

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

      

      INVESTOR
QUESTIONNAIRE

      

      Instructions:
Check all boxes below which correctly describe you.

      

      
        	
                 ̈

              	
                You are (i) a bank, as defined in Section
      3(a)(2) of the Securities Act of 1933, as amended (the “Securities
      Act”), (ii) a savings and loan association
      or other institution, as defined in Section 3(a)(5)(A) of the Securities
      Act, whether acting in an individual or fiduciary capacity, (iii) a broker or dealer registered
      pursuant to Section 15 of the Securities Exchange Act of 1934, as amended
      (the “Exchange
      Act”), (iv) an insurance company as defined
      in Section 2(13) of the Securities Act, (v) an investment company
      registered under the Investment Company Act of 1940, as amended (the
      “Investment
      Company Act”),
      (vi) a business development company
      as defined in Section 2(a)(48) of the Investment Company Act,
      (vii) a Small Business Investment
      Company licensed by the U.S. Small Business Administration under Section
      301 (c) or (d) of the Small Business Investment Act of 1958, as amended,
      (viii) a plan established and
      maintained by a state, its political subdivisions, or an agency or
      instrumentality of a state or its political subdivisions, for the benefit
      of its employees and you have total assets in excess of $5,000,000, or
      (ix) an employee benefit plan within
      the meaning of the Employee Retirement Income Security Act of 1974, as
      amended (“ERISA”) and (1) the decision that you shall
      subscribe for and purchase units consisting of one share of Series A
      Convertible Preferred Stock and a detachable warrant to purchase one-half
      share of common stock (the “Units”), is made by a plan fiduciary, as
      defined in Section 3(21) of ERISA, which is either a bank, savings and
      loan association, insurance company, or registered investment adviser, (2)
      you have total assets in excess of $5,000,000 and the decision that you
      shall subscribe for and purchase the Units is made solely by persons or
      entities that are accredited investors, as defined in Rule 501 of
      Regulation D promulgated under the Securities Act (“Regulation
      D”) or (3) you are a self-directed plan
      and the decision that you shall subscribe for and purchase the Units is
      made solely by persons or entities that are accredited
      investors.

              

      

      

      
        	
                 ̈

              	
                You are a private business
      development company as defined in Section 202(a)(22) of the Investment
      Advisers Act of 1940, as
amended.

              

      

      

      
        	
                 ̈

              	
                You are an organization described
      in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the
      “Code”), a corporation, Massachusetts
      or similar business trust or a partnership, in each case not formed for
      the specific purpose of making an investment in the Units and with total
      assets in excess of
$5,000,000.

              

      

      

      
        	
                 ̈

              	
                You are a director or executive
      officer of Image Metrics
Limited.

              

      

      

      
        	
                 ̈

              	
                You are a natural person whose
      individual net worth, or joint net worth with your spouse, exceeds
      $1,000,000 at the time of your subscription for and purchase of the
      Units.

              

      

      

      
        	
                 ̈

              	
                You are a natural person who had
      an individual income in excess of $200,000 in each of the two most recent
      years or joint income with your spouse in excess of $300,000 in each of
      the two most recent years, and who has a reasonable expectation of
      reaching the same income level in the current
  year.

              

      

      

      
        	
                 ̈

              	
                You are a trust, with total
      assets in excess of $5,000,000, not formed for the specific purpose of
      acquiring the Units, whose subscription for and purchase of the Units is
      directed by a sophisticated person as described in Rule 506(b)(2)(ii) of
      Regulation D.

              

      

      

      
        	
                 ̈

              	
                You are an entity in which all of
      the equity owners are persons or entities described in one of the
      preceding paragraphs.

              

      

       

      
        
           

        

        
          20

          
            

          

        

        
           

        

      

      

      The
undersigned hereby represents and warrants that all of its answers to this
Investor Questionnaire are true as of the date of its execution of the
Subscription Agreement pursuant to which it purchased Units of
Pubco.

      

      
        	
                    

              	 
      	
                    

              
	
                Name
      of Purchaser [please print]

              	 
      	
                Name
      of Co-Purchaser [please print]

              
	 
      	 
      	 
      
	
                    

              	 
      	
                    

              
	
                Signature
      of Purchaser (Entities please

              	 
      	
                Signature
      of Co-Purchaser

              
	
                provide
      signature of Purchaser’s duly

              	 
      	 
      
	
                authorized
      signatory.)

              	 
      	 
      
	 
      	 
      	 
      
	
                    

              	 
      	 
      
	
                Name
      of Signatory (Entities only)

              	 
      	 
      
	 
      	 
      	 
      
	
                    

              	 
      	 
      
	
                Title
      of Signatory (Entities only)

              	
                  

              	 
      

      

       

      
        
           

        

        
          21

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