Document:

** This exhibit contains  confidential  material which has been omitted pursuant
to a Confidential  Treatment  Request.  The omitted  information  has been filed
separately with the Securities and Exchange Commission.

                      LICENSE AND BINDER PURCHASE AGREEMENT

         THIS LICENSE AND BINDER PURCHASE AGREEMENT (the  "Agreement"),  is made
and  entered  into as of April 17,  2000 by and  between  DTE  Kentucky,  LLC, a
Delaware limited  liability company (the  "Licensee"),  and Covol  Technologies,
Inc., a Delaware corporation (the "Licensor").

         WHEREAS  Licensor  has  developed  a  proprietary  process  to  produce
synthetic coal fuel extrusions,  pellets, and briquettes  (collectively referred
to herein as  "briquettes")  from  waste  coal  dust,  coal fines and other coal
derivatives,  and Licensor is entitled to license the synthetic Coal Briquetting
Technology (as defined below) to Licensee;

         WHEREAS  Licensor  owns  a  synthetic  fuel  manufacturing  plant  (the
"Facility"),  which is  dismantled  and stored at the  Buccaneer  Storage  Yard,
Buccaneer  Enterprises,  Inc., Route 10, Box 393, Buckhannon,  West Virginia and
Licensee has or will acquire the Facility from Licensor as  contemplated by that
certain  Asset  Purchase  Agreement,  dated as of April 17, 2000, by and between
Licensee, Licensor, Mountaineer Fuel, LLC, a Utah limited liability company, and
Synfuel  Investments,  Inc., a Utah  corporation,  each subsidiaries of Licensor
(the "Purchase Agreement");

         WHEREAS  Licensee  wishes to  obtain  and  Licensor  wishes to grant to
Licensee a license for the synthetic Coal  Briquetting  Technology to be used in
connection  with the  Facility  on the  terms and  conditions  set forth in this
Agreement, and Licensee wishes to obtain and Licensor wishes to sell to Licensee
the  Proprietary  Binder Material (as defined below) for use in the operation of
the Facility.

         NOW, THEREFORE,  in consideration of the foregoing premises, the mutual
covenants  and  agreements  hereinafter  set forth,  and other good and valuable
consideration,  the receipt  and  sufficiency  of which is hereby  acknowledged,
Licensor and Licensee each agree as follows:

         Section 1.  Definitions.

         "Coal Briquetting Technology" means all intellectual property,  patents
(including,  but  not  limited  to,  United  States  Patent  Numbers  5,599,361;
5,487,764;  and 5,453,103) and  applications  therefor,  printed and not printed
technical  data,  know-how,  trade secrets,  copyrights  and other  intellectual
property rights, inventions, discoveries, techniques, works, processes, methods,
plans, software, designs, drawings, schematics,  specifications,  communications
protocols,  source and object code and modifications,  test procedures,  program
cards,  tapes,   disks,   algorithms  and  all  other  scientific  or  technical
information in whatever form including "Developed Technology" and "Improvements"
relating to,  embodied in or used in the process to produce  synthetic coal fuel
briquettes from waste coal dust, coal fines, run of mine coal, and other similar
coal derivatives,  including all such information in existence as of the date of
this  Agreement  as well as related  information  later  developed  by Licensor;
provided, however, that the defined term "Coal Briquetting Technology" shall not
include the proprietary  process/method  or other binder material or composition
developed by Licensor to produce  synthetic  coke  briquettes  from coke breeze,
iron revert materials,  or any technology used in any application other than the
processing

<PAGE>

and production of synthetic coal fuel  briquettes.  Nothing in this Agreement is
intended to grant to Licensee the right to apply the Coal Briquetting Technology
to produce  anything  other than synthetic coal fuel intended to qualify for tax
credits under Section 29(c)(1)(C) of the Internal Revenue Code.

         "Code" means the Internal Revenue Code of 1986, as amended.

         "Developed   Technology"   means  any  inventions,   "Improvement,"  or
technology that Licensor may conceive,  make,  invent,  or suggest in connection
with Licensor's disclosure to Licensee of the Coal Briquetting  Technology,  all
of which the  parties  hereto  acknowledge  and agree  constitutes  the sole and
exclusive   property  of  Licensor.   "Developed   Technology"  also  means  any
inventions,  "Improvement,"  or new  technology  directly  related  to the  Coal
Briquetting  Technology that Licensor or Licensee may conceive,  make, invent or
suggest  relating  to the Coal  Briquetting  Technology  during the Term of this
Agreement; provided, however, that "Developed Technology" shall not include coal
fines recovery,  coal fines washing,  material  handling,  or product  marketing
techniques or technologies  conceived,  made, invented, or suggested by Licensee
that are  generally  applicable  to the coal  industry but which are used at the
Facility in connection with the Coal Briquetting Technology.

         "Effective Date" means the date of this Agreement set forth above.

         "Facility" has the meaning set forth in the preamble.

         "Improvement"  means an  alteration  or  addition  to an  invention  or
discovery  which may  enhance  performance  or  economics  while  maintaining  a
product's,   device's,   or  method's  essential  identity  and  character.   An
"Improvement"  may  comprise  alterations  or  additions  to either  patented or
unpatented inventions,  discoveries,  technology, or devices, and may or may not
be patentable;  provided,  however,  that  "Improvement"  shall not include coal
fines recovery,  coal fines washing,  material  handling,  or product  marketing
techniques or technologies  conceived,  made, invented, or suggested by Licensee
that are  generally  applicable  to the coal  industry but which are used at the
Facility in connection with the Coal Briquetting Technology.

         "Licensee" has the meaning set forth in the preamble.

         "Licensor" has the meaning set forth in the preamble.

         "Proprietary  Binder  Material" means and refers to the binder compound
necessary  for the  production,  by Licensee,  of synthetic  coal  briquettes as
contemplated  under the Purchase  Agreement and which  briquettes are reasonably
expected  to  constitute  "qualified  fuels"  pursuant  to the terms of  Section
29(c)(1)(C)  of the Code and with  respect  to which  Section  29 is  applicable
pursuant to Section 29(f) and 29(g) of the Code.

         "Purchase Agreement" has the meaning set forth in the preamble.

         "Royalty" has the meaning set forth in Section 3.

         Section 2.  License Grant.

                                       2
<PAGE>

         2.1 General. Licensor hereby grants to Licensee a non-exclusive license
to use the Coal Briquetting  Technology,  including Developed  Technology and/or
Improvements relating to the Coal Briquetting Technology, throughout the term of
this  Agreement,  for the  purpose of  commercial  exploitation,  including  the
non-exclusive  right to make,  have made or use at the  Facility and to offer to
sell and to sell or otherwise transfer products that have been manufactured with
the Coal  Briquetting  Technology,  subject to the terms and  conditions of this
Agreement.  Licensee  hereby  accepts the license on the terms hereof.  Licensee
shall not have the right to sublicense the Coal Briquetting Technology.

         2.2  Licensor's  Ownership  of  Developed  Technology.   All  Developed
Technology  and/or   Improvements  are  and  shall  become  Licensor's  absolute
property,  subject to the terms of this  Agreement.  Licensee  shall at any time
during the Term of this  Agreement  and  thereafter,  at  Licensor's  reasonable
request,  execute any patent papers  covering such Developed  Technology  and/or
Improvements as well as any other documents that Licensor may consider necessary
or  helpful  in the  prosecution  of  applications  for a patent  thereon  or in
connection  with  any  litigation  or  controversy  related  thereto;  provided,
however,  that all expenses  incident to the filing of such applications and the
prosecution  thereof  and the  conduct  of such  litigation  shall  be  borne by
Licensor.

         2.3  Exclusive  Technology.  Licensee  agrees  to  use  only  the  Coal
Briquetting  Technology  at the Facility and not to use any other  technology at
the Facility,  except to the extent other or additional technology is necessary.
Licensee shall not use any process or  methodology  that is not part of the Coal
Briquetting Technology, except to the extent that other or additional technology
is necessary.  Licensee (a) shall not make or have made products  using the Coal
Briquetting  Technology  or similar  technology  except at the  Facility and (b)
shall only make and have made products using the Coal Briquetting  Technology at
the  Facility  under  this  License  Agreement,  except to the  extent  other or
additional  technology is  necessary.  Licensee  further  agrees to use the Coal
Briquetting  Technology  only under  authority  of this License  Agreement  with
Licensor. Notwithstanding the foregoing, Licensee may produce Section 29 Product
at the  Facility  without the use of the  Proprietary  Binder  Material and with
binder  material  provided  elsewhere  subject  to the  requirement  to pay  the
additional royalty provided in Section 3.1 hereof.

         2.4  Non-licensed  Technology.  Licensor  retains the absolute right to
fully exploit its technologies including, but not limited to, the application of
such technology embodied in the Coal Briquetting  Technology to produce,  market
and use synthetic coke briquettes from coke breeze,  iron revert materials,  and
any other materials to which Licensor's technology can be applied.

         2.5  Confidentiality.  Each of the parties hereby agree to maintain the
Coal  Briquetting   Technology   confidential  and  not  to  disclose  the  Coal
Briquetting  Technology,   or  any  aspect  thereof,   including  the  Developed
Technology  or  Improvements  (collectively,  the  "Confidential  Information").
Notwithstanding  the foregoing,  information  which (a) is or becomes  generally
available to the public other than as a result of an unauthorized  disclosure by
the parties or their respective agents, employees, directors or representatives,
(b) was available to the party receiving disclosure on a non-confidential  basis
prior to its receiving disclosure  hereunder,  (c) lawfully becomes available to
the party receiving  disclosure on a  non-confidential  basis from a third party
source (provided that such source is not known by the party receiving disclosure
or its agents,

                                       3
<PAGE>

employees,  directors or  representatives to be prohibited from transmitting the
information), or (d) a party is compelled by legal process by any court or other
authority to disclose  shall not be subject to the terms of this Section 2.5. In
the case of (d) above,  the  compelled  party shall give the other party  prompt
written  notice of such legal  process in order that an  appropriate  protective
order can be sought  and each  party  agrees  not to  oppose  the other  party's
efforts  to  prevent  the  disclosure  of  Confidential   Information.   At  the
termination  of this  Agreement,  all  copies  of any  Confidential  Information
(including,  without limitation,  any reports or memoranda) shall be returned by
the  party  receiving  disclosure.  Nothing  in this  Agreement  shall  prohibit
Licensee  from  disclosing  the  Confidential  Information  to  others as may be
reasonably  necessary  for  Licensee  to  exploit  Licensee's  rights  under the
Purchase  Agreement,  and/or this Agreement;  provided that the recipient of any
such Confidential  Information executes a Confidentiality  Agreement restricting
further disclosure of the Confidential Information.

         2.6 Know-How and  Assistance.  To enable Licensee to benefit fully from
the license of the Coal Briquetting Technology, Licensor shall provide access to
all  relevant  documentation,  drawings,  engineering  specifications  and other
know-how in its possession, reasonable access to its employees or agents who are
familiar  with  the  Coal  Briquetting  Technology,  Developed  Technology,  and
Improvements  and shall  provide such  technical  assistance  and training as is
requested  by  Licensee.  If  Licensor  does  not  have  responsibility  for the
operation of the Facility,  Licensee  shall  reimburse  Licensor for  reasonable
travel and other  similar  out-of-pocket  expenses  of  Licensor  in  performing
services under this Section 2.6;  provided  however,  that Licensor shall obtain
the prior approval of Licensee for any expenditures in excess of $5,000.

         Section 3.  Royalty.

         3.1 Royalty Payments. During the term of this Agreement, Licensee shall
pay to  Licensor  a  royalty  in an  amount  equal to $** per ton for the  first
360,000  tons  per  calendar  year,  and $** per ton for all tons in  excess  of
360,000 tons in a calendar year, of Section 29 Product  produced at the Facility
and sold during the period  commencing on the  effective  date hereof and ending
upon the expiration of the term (or earlier termination) of this Agreement. Such
royalty  shall be paid  quarterly  on the last day of January,  April,  July and
October  of each year for the  Section  29  Product  sold  during  the  previous
calendar quarter. In the event that, during the term of this Agreement, Licensee
elects to use a binder  material  other than the  Proprietary  Binder  Material,
Licensee will pay an additional royalty to Licensor in the amount of $** per ton
of Section 29 Product produced at the Facility,  without the Proprietary  Binder
Material, and sold to any third-party customer.

                                       4
<PAGE>

         Section 4.  Sales of Binder.

         4.1 Sale and Purchase.  Licensor  shall sell to Licensee,  and Licensee
shall  purchase from  Licensor,  all of Licensee's  requirements  of Proprietary
Binder  Material  required to operate the Facility.  Licensor  shall deliver the
Proprietary  Binder  Material at such times and in such  amounts as requested by
Licensee.  Licensor  shall  invoice  Licensee for  Proprietary  Binder  Material
monthly.  Payments for Proprietary  Binder Material delivered by Licensor during
any  calendar  month shall be due and payable to Licensor on the tenth  business
day of the immediately succeeding month.

         4.2  Price.  The price  which  Licensee  shall pay for the  Proprietary
Binder Material delivered by Licensor shall be an amount equal to (a) Licensor's
direct and actual costs  (including,  but not limited to,  material,  labor, and
transportation  costs) and a percentage of the total  overhead costs of Licensor
reasonably  reflecting  the  ratio  of  the  administrative  costs  incurred  in
connection  with the  manufacture  and sale of the  Proprietary  Binder Material
(estimated at the date hereof to be $** per unit of Proprietary  Binder Material
necessary to create one (1) ton of synthetic  fuel  product),  payable within 30
days  of  receipt  of an  invoice  therefor,  plus  (b) **  ($**)  per  unit  of
Proprietary  Binder  Material  necessary to create one (1) ton of synthetic fuel
product,  payable for the preceding calendar quarter on the last day of January,
April, July and October of each year.

         4.3  Licensor  Representations  and  Warranties.  Licensor  represents,
warrants and covenants as follows:

                  (a)  Licensor  shall  convey  to  Licensee  good  title to all
Proprietary Binder Material purchased by Licensee from Licensor hereunder,  free
and clear of any and all liens, claims and encumbrances of any type whatsoever.

                  (b) No Proprietary Binder Material shall contain any hazardous
material in violation of applicable laws and governmental regulations.

                  (c) At Licensee's reasonable request,  Licensor shall replace,
or  refund  the  purchase  price  of,  all  non-conforming  Proprietary  Binding
Material.

                  (d) Proper use of the Coal Briquetting  Technology,  including
use at an adequate,  qualified  Facility and with adequate  feedstocks and other
raw  materials,  will enable  Licensor to produce a product  which is reasonably
expected  to  constitute  "qualified  fuels"  pursuant  to the terms of  Section
29(c)(1)(C) of the Code.

         4.4 Order  Procedure.  Licensee  shall deliver all purchase  orders for
Proprietary  Binder  Material at least  thirty (30) days in advance of the first
day of the  month in which  delivery  of such  Proprietary  Binder  Material  is
required  under such  purchase  order.  (For example,  Licensee  shall deliver a
purchase order for December  delivery by no later than November 1st).  Each such
purchase order shall be delivered  either (a) in writing  (including by fax), or
(b) orally by  telephone  by an  authorized  agent of  Licensee  (subject to the
condition that it is followed by a

                                       5
<PAGE>

written  purchase order within 24 hours).  Such purchase orders shall be sent to
Licensor at such address as Licensor shall direct.

         4.5 Delivery and Acceptance.  All Proprietary Binder Material purchased
hereunder shall be delivered F.O.B. the Facility. Licensor shall arrange for any
necessary  transportation  of the  Proprietary  Binder Material to the Facility.
Licensee  shall bear the expense of unloading the  Proprietary  Binder  Material
from  the  trucks.  Licensee  shall  have a  reasonable  opportunity  to  sample
Proprietary  Binder  Material  delivered  to it  hereunder  to confirm that such
Proprietary  Binder Material conforms to the terms and requirements  hereof, and
Licensee shall not be deemed or required to accept any such  Proprietary  Binder
Material prior to the completion of such sampling.

         4.6 Delivery of Binder Material.  If Licensor's  ability to deliver the
Proprietary  Binder  Material to Licensee will be  interrupted or terminated for
any  reason,  Licensor  shall  give not less than  ninety  (90)  days  notice to
Licensee.  Subject to giving notice of its inability to deliver the  Proprietary
Binder  Material to Licensee  (or,  in the  absence of such  notice,  the actual
failure to deliver the Proprietary Binder Material for at least twenty (20) days
after  Licensee  gives written  notice of  non-delivery  to Licensor),  Licensor
hereby grants to Licensee a nonexclusive  license for the term of this Agreement
(or such shorter period as provided in the proviso hereto) to use the technology
used to manufacture the Proprietary Binder Material, and the copy of the Formula
delivered in escrow  pursuant to Section  4.7, to  manufacture  the  Proprietary
Binder  Material  in  sufficient  quantities  to operate  the  Facility  to full
capacity, and such technology shall be deemed "Coal Briquetting  Technology" for
the purposes of this Agreement;  provided,  however, that the license granted to
Licensee under this Section 4.6 shall cease (subject to  reinstatement  upon the
reoccurrence of the events  contemplated  above) and sales of Proprietary Binder
Material under the terms of this Agreement shall be reinstated, in each case, on
a date not less than ninety (90) days after  Licensor  gives notice to Licensee,
together with evidence reasonably satisfactory to Licensee that Licensor is able
to deliver the Proprietary Binder Material in accordance with this Agreement. No
additional  fee or royalty shall be payable to Licensor in  connection  with the
License  granted  pursuant to this Section 4.6 and Licensor shall be responsible
for any additional  out-of-pocket  costs incurred by Licensee in connection with
the production of Proprietary Binder Material pursuant to this Section 4.6.

         4.7 Escrow of Binder  Material  Formula.  As a material  inducement for
Licensee  entering  into this  Agreement  and for the Buyer  under the  Purchase
Agreement  entering  into  the  Purchase  Agreement,  and in  order  to  provide
assurance  to  Licensee of access to an adequate  and  continuing  supply of the
Proprietary  Binder Material during the term of this Agreement,  Licensor agrees
to place in escrow with Licensee the formula and technology  used to manufacture
the  Proprietary   Binder  Material  (the  "Formula")  as  provided  herein.  In
connection therewith,  Licensor agrees to deposit with Licensee, within ten (10)
days of the date of this  Agreement,  a copy of the Formula.  During the term of
this  Agreement,  Licensor  shall keep the  Formula in escrow  fully  current by
depositing  all updates and  revisions  thereto  and related  materials,  as the
Formula may be updated or revised from time to time. Such supplemental  deposits
will be  completed  no later  than ten (10)  days  after the date of use of such
revised Formula by Licensor.  Title to the Formula shall remain in Licensor, but
title to the copy  thereof to be  deposited in escrow  hereunder  shall,  in the
event the Formula  shall be released  for use to Licensee as provided in Section
4.6, pass to and vest in Licensee.  Licensee shall hold such copy of the Formula
and

                                       6
<PAGE>

any supplements in a safe-deposit box at a financial  institution located in the
Detroit/Ann  Arbor,  Michigan  region  designated  by  Licensee  and  reasonably
approved by Licensor.  Notwithstanding its ownership of a copy of the Formula in
such event,  Licensee's  use of the Formula shall remain subject to the terms of
this Agreement.

         Section 5.  Records;  Inspection;  Confidentiality.  Each party  hereto
shall keep accurate  records  containing  all data  reasonably  required for the
computation and verification of the amounts to be paid by the respective parties
under  this  Agreement,  and shall  permit  each other  party or an  independent
accounting  firm  designated  by such other party to inspect  and/or  audit such
records during normal business hours upon reasonable  advance notice.  All costs
and expenses  incurred by a party in connection  with such  inspection  shall be
borne by it. Each party agrees to hold  confidential  from all third parties all
information contained in records examined by or on behalf of it pursuant to this
Section 5; provided, however, that information which (a) is or becomes generally
available to the public other than as a result of an unauthorized  disclosure by
the parties or their respective agents, employees, directors or representatives,
(b) was available to the party receiving disclosure on a non-confidential  basis
prior to its receiving disclosure  hereunder,  (c) lawfully becomes available to
the party receiving  disclosure on a  non-confidential  basis from a third party
source (provided that such source is not known by the party receiving disclosure
or its agents,  employees,  directors or  representatives  to be prohibited from
transmitting the  information),  or (d) a party is compelled by legal process by
any court or other  authority  to disclose  shall not be subject to the terms of
this  Section 5. In the case of (d) above,  the  compelled  party shall give the
other  party  prompt  written  notice of such  legal  process  in order  that an
appropriate  protective  order can be sought and each party agrees not to oppose
the other party's efforts to prevent the disclosure of such information.  At the
termination  of this  Agreement,  all  copies  of such  information  (including,
without  limitation,  any reports or  memoranda)  shall be returned by the party
receiving disclosure.

         Section 6. Enforcement of Proprietary Rights.  Licensee shall cooperate
in good faith,  with Licensor's  efforts to enforce its  proprietary  patent and
trade secret rights.

         Section 7.  General Representations and Warranties.

         7.1  Authority.  Each of Licensee and Licensor  represents and warrants
that (a) the  execution,  delivery and  performance  of this  Agreement  and the
consummation of the transactions  contemplated  hereby have been duly authorized
on its behalf by all requisite  action,  corporate or otherwise,  (b) it has the
full right,  power and  authority to enter into this  Agreement and to carry out
the  terms  of this  Agreement,  (c) it has duly  executed  and  delivered  this
Agreement,  and (d) this  Agreement  is a valid  and  binding  obligation  of it
enforceable in accordance with its terms.

         7.2 No Consent.  Each of Licensee and Licensor  represents and warrants
that no approval, consent,  authorization,  order, designation or declaration of
any court or regulatory  authority or  governmental  body or any  third-party is
required to be obtained by it, nor is any filing or registration  required to be
made therewith by it for the consummation by it of the transactions contemplated
under this Agreement.

         7.3 Intellectual  Property  Matters.  Licensor  represents and warrants
that (a) it owns, free and clear of all liens and encumbrances,  patents related
to the Coal Briquetting Technology

                                       7
<PAGE>

(including,  but  not  limited  to,  United  States  Patent  Numbers  5,599,361,
5,487,764 and  5,453,103)  and has developed  the Coal  Briquetting  Technology,
including, but not limited to, printed and not printed technical data, know-how,
trade secrets,  copyrights, and other intellectual property rights and all other
scientific or technical information in whatever form relating to, embodied in or
used in the process to produce  synthetic coal fuel  briquettes  from waste coal
dust, coal fines, run of mine coal and other similar coal derivatives,  and, the
right to freely make, use, sell and exploit  Proprietary Binder Material used in
manufacturing  synthetic coal fuel  briquettes  from waste coal dust, coal fines
and other similar coal  derivatives,  (b) it has the right and power to grant to
Licensee the  licenses  granted  herein,  and (c) the sale or use of the rights,
Proprietary  Binder Material  and/or licenses  granted herein as contemplated by
this Agreement will not infringe any third-party's intellectual property rights.

         7.4  Indemnification.  Each party agrees to indemnify,  defend and hold
harmless the other party and its partners, directors, officers, members, agents,
representatives,  subsidiaries  and  affiliates  from  and  against  any and all
claims,  demands or suits (by any party,  including  any  governmental  entity),
losses,  liabilities,   damages,  obligations,   payments,  costs  and  expenses
(including  the  costs  and  expenses  of  enforcing  this  indemnification  and
defending  any and all actions,  suits,  proceedings,  demands and  assessments,
which shall include reasonable  attorneys' fees and court costs) resulting from,
relating to, arising out of, or incurred in connection with any breach of any of
the representations, warranties and/or covenants contained in this Agreement.

         Section  8.  Term.  The  term  of  this  Agreement  is for  the  period
commencing  on the Effective  Date of this  Agreement and ending on the later of
(a) 31 December  2007,  (b) the full term of Section 29 of the Code,  or (c) the
last to expire of the U.S.  patents in existence at the  Effective  Date of this
Agreement  that  disclose  and  claim  Covol's   proprietary   Coal  Briquetting
Technology  as  defined  herein.  Any  extension  of this  Agreement  must be in
writing, signed by both parties.

         Section  9.  Termination.  This  Agreement  shall  terminate  upon  the
termination  date set forth in Section 8,  unless the  Agreement  is  terminated
sooner pursuant to this Section 9.

         9.1  Termination  for Cause. In addition to any other remedies that may
exist,  either party may  terminate  this  Agreement  for cause in the event the
other party  commits a material  breach of any  provision  of this  Agreement by
giving the other  party at least  sixty (60) days prior  written  notice of such
termination, unless such default or breach is cured within said sixty (60) days.
If either party  terminates this Agreement  pursuant to this Section 9, Licensee
shall  promptly  return and cause all agents of Licensee  to promptly  return to
Licensor all Confidential  Information and all Coal Briquetting  Technology then
in Licensee's  possession,  and Licensee  shall not  thereafter  use for its own
commercial benefit or disclose to any third person any Confidential  Information
or Coal Briquetting Technology during the period ending three (3) years from the
date of such termination.  Notwithstanding the foregoing,  information which (a)
is or becomes  generally  available  to the public  other than as a result of an
unauthorized  disclosure  by the  Licensee or its  respective  members,  agents,
employees, directors or representatives,  (b) was available to the Licensee on a
non-confidential basis prior to its receiving disclosure hereunder, (c) lawfully
becomes available to the Licensee on a non-confidential basis from a third party
source  (provided  that such source is not known by the Licensee or its members,
agents,   employees,   directors  or   representatives  to  be  prohibited  from
transmitting the information), or (d) the Licensee is

                                       8
<PAGE>

compelled by legal process by any court or other authority to disclose shall not
be  subject  to the terms of the duty to protect  Confidential  Information  set
forth in this  section.  In the case of (d) above,  the Licensee  shall give the
Licensor  prompt  written  notice  of  such  legal  process  in  order  that  an
appropriate  protective  order can be sought and  Licensee  agrees not to oppose
Licensor's efforts to prevent the disclosure of Confidential Information.

         9.2 Termination for Insolvency or Ceasing Business.  This Agreement may
be terminated by either party if:

           (a) The other party  becomes  insolvent or is unable to pay its debts
as they fall due, seeks protection  voluntarily or  involuntarily  under any law
relating to bankruptcy, receivership, insolvency,  administration,  liquidation,
dissolution or similar law of any jurisdiction (other than for the purposes of a
reorganization  with a view to continuing  the business as a going concern under
relevant  bankruptcy  or  insolvency  proceedings)  or  enters  into  a  general
assignment  or  arrangement  or a  composition  with or for the  benefit  of its
creditors; or

           (b)  The  other  party  takes  any  step  (including  the  filing  or
presentation  of a  petition,  the  convening  of a meeting  or the filing of an
application  or  consent)  in any  jurisdiction  for,  or  with a view  to,  the
appointment of an administrator,  liquidator,  receiver,  trustee,  custodian or
similar official (other than for the purposes of a reorganization with a view to
continuing  the  business  as a  going  concern  under  relevant  bankruptcy  or
insolvency  proceedings)  for such  party  and/or  the  whole or any part of the
business,  undertaking,  property,  assets, receiver or uncalled capital of such
party Licensee or any such person is appointed.

         9.3 Effect of  Termination.  Upon  termination of this  Agreement,  all
rights granted to and future obligations of the parties shall immediately cease;
however  termination  shall not relieve either party of its obligations  accrued
during the term of this  Agreement  (including  any  pre-termination  obligation
Licensee  may  have to pay  Licensor)  which  has not  been  fulfilled,  and all
representations,  warranties,  indemnification  obligations and  confidentiality
agreements made herein shall survive termination of this Agreement.

         Section  10.  Effectiveness  of  Certain  Provisions.   Notwithstanding
anything herein to the contrary,  Licensee shall not be obligated under Sections
2.3,  3.1 or 4.1 hereof  unless and until  Licensee  has  entered  into  binding
agreements  with a third party to relocate  and place the Facility at a suitable
location  and to sell the  output of the  Facility,  all  pursuant  to terms and
conditions mutually acceptable to Licensee and a third party.

         Section 11. Waiver. The failure of any party to enforce at any time any
provision of this Agreement shall not be construed as a waiver of such provision
or the right  thereafter to enforce each and every  provision.  No waiver by any
party, either express or implied, of any breach of any of the provisions of this
Agreement  shall be  construed  as a waiver of any other  breach of such term or
condition.

         Section 12.  Severability.  If any provision of this Agreement shall be
held by a court of competent  jurisdiction to be invalid or unenforceable in any
respect for any reason, the validity and enforceability of any such provision in
any other respect and of the remaining provisions of this Agreement shall not be
in any way impaired.

                                       9
<PAGE>

         Section  13.  Notices.  All  notices  required  or  authorized  by this
Agreement shall be effective upon receipt and given to the parties in writing by
fax, mail, or courier as follows:

         To Licensor:          Brent M. Cook, President
                               Covol Technologies, Inc.
                               3280 North Frontage Road
                               Lehi, Utah 84043
                               Fax:  (801) 768-4481

         To Licensee:          DTE Kentucky, LLC
                               425 South Main Street
                               Suite 201
                               Ann Arbor, Michigan  48104
                               Fax:  (734) 668-9739
                               Attn:  Manager of Assets

         With a copy to:       DTE Energy Services, Inc.
                               425 South Main Street
                               Suite 201
                               Ann Arbor, Michigan  48104
                               Fax: (734) 668-1028
                               Attn:  General Counsel

         Section 14. Remedies Cumulative. Remedies provided under this Agreement
shall be  cumulative  and in  addition to other  remedies  provided by law or in
equity.

         Section  15.  Entire  Agreement.  This  Agreement,  together  with  the
Transaction  Documents (as defined in the Purchase  Agreement),  constitutes the
entire agreement of the parties relating to the subject matter hereof. There are
no promises,  terms,  conditions,  obligations,  or warranties  other than those
contained  herein and therein.  This  Agreement  and the  Transaction  Documents
supersede  any and all prior  communications,  representations,  or  agreements,
verbal or written,  between the parties  relating to the subject  matter hereof.
This  Agreement  may not be  amended  except in  writing  signed by the  parties
hereto.

         Section  16.  Governing  Law.  This  Agreement  shall  be  governed  in
accordance with the laws of the State of New York,  exclusive of its conflict of
laws rules.

         Section 17. Assignment. This Agreement may not be assigned, in whole or
in part,  by any party  without the written  consent of the other  party,  which
consent shall not be  unreasonably  withheld,  except that Licensor and Licensee
shall have the right to assign their  respective  rights and  obligations  under
this Agreement to any entity which is controlled by Licensor or Licensee, as the
case may be,  and of  which  Licensor  or  Licensee,  as the case may be,  owns,
directly  or  indirectly,  at least  fifty  percent  (50%) of each  class of its
outstanding securities,  provided that no such assignment shall release Licensor
or Licensee, as the case may be, from their respective obligations hereunder.

                  [Remainder of page intentionally left blank]

                                       10
<PAGE>

         Executed by the duly  authorized  representative  of the parties on the
date and year first above written.

COVOL TECHNOLOGIES, INC.                   DTE KENTUCKY, LLC

By: /s/ Kirk A. Benson                     By:  /s/  Kent L. McCargar
    ----------------------------               -------------------------------
Name:  Kirk A. Benson                      Name:   Kent L. McCargar
Its:     CEO                               Its: Vice President and Chief
                                                Financial Officer

                                       11STOCK PURCHASE AGREEMENT

                                     BETWEEN

                          SHADY DALE INVESTMENTS, LLC.,
                          J. D. JENKINS AND RON JENKINS

                                      AND

                             iCOMMERCE GROUP, INC.

                                 AUGUST 1, 1999

<PAGE>
<TABLE>
<CAPTION>
                                TABLE OF CONTENTS
<S>     <C>                                                                  <C>
Section 1.    Definitions..................................................  1

Section 2.    Purchase and Sale of Company shares..........................  3
         (a)  Basic Transaction............................................  3
         (b)  Purchase Price...............................................  3
         (c)  The Closing .................................................  3
         (d)  Deliveries at the Closing....................................  3

Section 3.    Representations and Warranties Concerning the Transaction....  4
         (a)  Representations and Warranties of Sellers....................  4
         (b)  Representations and Warranties of Buyer......................  4

Section 4.    Representations and Warranties Concerning the Company and its
                Subsidiaries...............................................  5
         (a)  Organization, Qualification, and Corporate Power.............  5
         (b)  Capitalization...............................................  5
         (c)  Noncontravention.............................................  6
         (d)  Brokers' Fees................................................  6
         (e)  Title to Personal Properties.................................  6
         (f)  Events Subsequent to June 30, 1999...........................  6
         (g)  Compliance with Law and Other Related Regulations............  7
         (h)  Intellectual Property........................................  8
         (i)  Employee Benefits............................................  8
         (j)  Certain Business Relationships With the Company and its
                Subsidiaries...............................................  8
         (k)  Minute Books.................................................  8
         (l)  Accuracy of Statements.......................................  8

 Section 5.   Pre-Closing Covenants........................................  8
         (a)  General......................................................  8
         (b)  Notice of Developments.......................................  8
         (c)  Exclusivity..................................................  9
         (d)  Covenants of Sellers.........................................  9

Section 6.    Post-Closing Covenants....................................... 11
         (a)  General...................................................... 11
         (b)  Litigation Support........................................... 11
         (c)  Transition................................................... 11
         (d)  Prepayment of Buyer Note..................................... 11

Section 7.    Conditions to Obligation to Close............................ 12
         (a)  Conditions to Obligation of Buyer............................ 12
         (b)  Conditions to Obligation of Sellers.......................... 12

Section 8.    Remedies for Breaches of This Agreement...................... 13
         (a)  Survival of Representations and Warranties................... 13
         (b)  Indemnification Provisions for Benefit of Buyer.............. 13
         (c)  Indemnification Provisions for Benefit of Sellers............ 14
         (d)  Matters Involving Third Parties.............................. 14

Section 9.    Termination.................................................. 15
         (a)  Termination of Agreement..................................... 15
         (b)  Effect of Termination........................................ 16

                                       i

<PAGE>

Section 10.   Miscellaneous................................................ 16
         (a)  Press Releases and Public Announcements...................... 16
         (b)  No Third Party Beneficiaries................................. 16
         (c)  Entire Agreement............................................. 16
         (d)  Succession and Assignment.................................... 16
         (e)  Counterparts................................................. 17
         (f)  Headings..................................................... 17
         (g)  Notices.....................................................  17
         (h)  Governing Law...............................................  17
         (i)  Amendments and Waivers......................................  18
         (j)  Severability................................................  18
         (k)  Expenses....................................................  18
         (l)  Construction................................................  18
         (m)  Incorporation of Exhibits and Schedules.....................  18
         (n)  Confidentiality.............................................  18
</TABLE>

EXHIBITS

Exhibit A -   Form of Buyer Note

                                       ii

<PAGE>

                            STOCK PURCHASE AGREEMENT

         AGREEMENT entered into as of August 1, 1999, by and between iCommerce
Group, Inc., a Delaware corporation ("Buyer"), Shady Dale Investments, LLC., a
Georgia Limited Liability Company ("LLC"), J. D. Jenkins and Ron Jenkins
(collectively, the "Sellers"). Buyer and Sellers are referred to herein at times
as the "Parties." Other capitalized terms used herein are defined in Section 1.

         WHEREAS, Sellers own all of the outstanding capital stock of Caribbean
Cigar Company (Cayman), Ltd., a Cayman Island corporation (the "Company");

         WHEREAS, the Company is engaged in the business of manufacturing and
distributing premium and other cigars;

         WHEREAS, subject to the terms and conditions set forth in this
Agreement, Buyer desires to purchase from Sellers, and Sellers desire to sell to
Buyer, all of the outstanding capital stock of the Company; and

         WHEREAS, the purchase price for the capital stock of the Company will
consist of shares of common stock of the Buyer and promissory notes payable by
Buyer;

         NOW, THEREFORE, in consideration of the premises and the mutual
promises herein made, and in consideration of the representations, warranties,
and covenants herein contained, the Parties agree as follows:

         Section 1. Definitions.

         "Adverse Consequences" means (i) all actions, suits, proceedings,
investigations, charges, complaints, claims, injunctions, judgments, orders,
decrees, rulings, damages, dues, penalties, fines, costs, reasonable amounts
paid in settlement, liabilities, obligations, taxes, liens, losses, expenses,
and fees, including court costs and reasonable attorneys' fees and expenses and
(ii) the amount of the loss, damage or expense (or decrease in the value of the
business of the Company) that is actually suffered or incurred by reason of a
breach of a representation or warranty or a covenant or agreement that would not
have been suffered or incurred if the representation or warranty or covenant or
agreement had not been breached.

         "Affiliate" means, with respect to any Person, any other Person that,
directly or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, the first mentioned Person
within the meaning of the Securities Exchange Act.

         "Applicable Rate" means the corporate base rate of interest announced
from time to time by Chemical Bank (or its successors).

         "Business" means the cigar manufacturing and distributing operations of
Caribbean Cigar Company (Cayman), Ltd.

         "Buyer" has the meaning set forth in the preface above.

         "Buyer Notes" has the meaning set forth in Section 2(b) below.

         "Closing" has the meaning set forth in Section 2(c) below.

         "Closing Date" has the meaning set forth in Section 2(c) below.

                                       1
<PAGE>

         "Code" where applicable in this Agreement means the Internal Revenue
Code of 1986, as amended.

         "Company" has the meaning set forth in the preface above.

         "Company Shares" means the shares of common stock, par value $.01 per
share, of the Company.

         "Disclosure Schedule" has the meaning set forth in Section 4 below.

         "Employee Benefit Plan" means any (a) nonqualified deferred
compensation or retirement plan or arrangement which is an Employee Pension
Benefit Plan, (b) qualified defined contribution retirement plan or arrangement
which is an Employee Pension Benefit Plan, (c) qualified defined benefit
retirement plan or arrangement which is an Employee Pension Benefit Plan, or (d)
Employee Welfare Benefit Plan.

         "GAAP" means United States generally accepted accounting principles as
in effect from time to time.

         "Income Tax" means any federal, state, local, or foreign income tax,
including any interest, penalty, or addition thereto, whether disputed or not.

         "Income Tax Return" means any return, declaration, report, claim for
refund, or information return or statement relating to Income Taxes, including
any schedule or attachment thereto.

         "Indemnified Party" has the meaning set forth in Section 8(d) below.

         "Indemnifying Party" has the meaning set forth in Section 8(d) below.

         "Intellectual Property" has the meaning set forth in Section 4(i)
below.

         "Knowledge" means actual knowledge without independent investigation.

         "Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice.

         "Party" has the meaning set forth in the preface above.

         "Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof), or any other entity.

         "Securities Act" means the Securities Act of 1933, as amended.

         "SEC" means the Securities and Exchange Commission.

         "Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.

         "Security Interest" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest, other than (a) mechanic's, materialmen's,
and similar liens, (b) liens for taxes not yet due and payable or for taxes that
the taxpayer is contesting in good faith through appropriate proceedings, (c)
purchase money liens on personal properties and liens securing rental payments
under capital lease arrangements for real or personal properties, and (d) other

                                       2
<PAGE>

liens arising in the Ordinary Course of Business and not incurred in connection
with the borrowing of money.

         "Sellers" has the meaning set forth in the preface above.

         "Subsidiary" means any corporation with respect to which a specified
Person (or a Subsidiary thereof) directly or indirectly owns a majority of the
common stock or has the power to vote or direct the voting of sufficient
securities to elect a majority of the directors (or any partnership as to which
such Person has a similar ownership or voting interest).

         "Third Party Claim" has the meaning set forth in Section 8(d) below.

         Section 2. Purchase and Sale of Company Shares.

         (a) Basic Transaction. On and subject to the terms and conditions of
this Agreement, Buyer agrees to purchase from Sellers, and Sellers agrees to
sell to Buyer, all of the outstanding Company Shares for the consideration
specified in Section 2(b).

         (b) Purchase Price. At the Closing, Buyer shall pay to Sellers the
following as the purchase price for the Company Shares: (i) 650,000 shares of
common stock of the Buyer and (ii) a negotiable promissory note in the principal
amount of $100,000 payable by Buyer to Sellers in the form of Exhibit A hereto
(the "Buyer Notes"). The number of shares representing all the outstanding
shares of the Company being purchased and the allocation is as follows:
<TABLE>
<CAPTION>
                                                                                       Payment of Purchase Price
                                                                                       -------------------------
                                                                                                            Note
         Name                                  # of Shares Being Sold                 Stock                Amount
         ----                                  ----------------------                 -----                ------
<S>                                                      <C>                           <C>                    <C>
         Shady Dale
         Investments, LLC                                1,000                         130,000                20,000
         J. D. Jenkins                                   2,001                         260,000                40,000
         Ron Jenkins                                     2,000                         260,000                40,000
                                                    ----------                   -------------         -------------
                                                         5,001                         650,000         $     100,000
                                                    ==========                   =============         =============
</TABLE>

         (c) The Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at the offices of the Company at
10:00 a.m. local time on September 30, 1999 (or, if later, the second business
day following the satisfaction or waiver of all conditions to the obligations of
the Parties to consummate the transactions contemplated hereby (other than
conditions with respect to actions the respective Parties will take at the
Closing itself)) (the "Closing Date").

         (d) Deliveries at the Closing. At the Closing, (i) Sellers will deliver
to Buyer the various instruments and documents referred to in Section 7(a)
below, (ii) Buyer will deliver to Sellers the various instruments and documents
referred to in Section 7(b) below (including the Buyer Notes), (iii) Sellers
will deliver to Buyer stock certificates representing all of the outstanding
Company Shares, endorsed in blank or accompanied by duly executed assignment
documents and (iv) Buyer will deliver to Sellers the consideration specified in
Section 2(b) above for the outstanding Company Shares.

                                       3
<PAGE>

         Section 3. Representations and Warranties Concerning the Transaction.

         (a) Representations and Warranties of Sellers. Sellers as defined in
Section 1. Definitions, or individually as identified herein, as the case may
be, represent and warrant to Buyer that the statements contained in this Section
3(a) are true and correct as of the date of this Agreement.

                  (i) Organization. Shady Dale Investments, LLC is a limited
liability company, duly organized and validly existing under the laws of
Georgia.

                  ii) Authorization of Transaction. Shady Dale Investments, LLC
has full power and authority to execute and deliver this Agreement and to
perform its obligations hereunder. This Agreement constitutes the valid and
legally binding obligation of Sellers, enforceable against them in accordance
with its terms. Sellers do not need to give any notice to, make any filing with,
or obtain any authorization, consent, or approval of any government or
governmental agency in order to consummate the transactions contemplated by this
Agreement.

                  (iii) Brokers' Fees. Neither the Sellers nor the Company have
any liability or obligation to pay any fees or commissions to any broker,
finder, or agent with respect to the transactions contemplated by this Agreement
for which Buyer could become liable or obligated.

                  (iv) Company Shares. Sellers hold of record and own
beneficially all of the issued and outstanding Company Shares free and clear of
any restrictions on transfer (other than restrictions under the Securities Act
and state securities laws), taxes, security interests, options, warrants,
purchase rights, contracts, commitments, equities, claims, demands, liens,
claims, charges and encumbrances. Sellers are not party to any option, warrant,
purchase right, or other contract or commitment that could require them to sell,
transfer, or otherwise dispose of any capital stock of the Company. Sellers are
not party to any voting trust, proxy, or other agreement or understanding with
respect to the voting of any capital stock of the Company.

                  (v) Investment. Sellers are not acquiring their i-Commerce
Group Notes with a view to or for sale in connection with any distribution
thereof within the meaning of the Securities Act.

         (b) Representations and Warranties of Buyer. Buyer represents and
warrants to Sellers that the statements contained in this Section 3(b) are true
and correct as of the date of this Agreement.

                  (i) Organization. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the Cayman Islands.

                  (ii) Authorization of Transaction. Buyer has the corporate
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally binding
obligation of Buyer, enforceable against it in accordance with its terms. Buyer
need not give any notice to, make any filing with, or obtain any authorization,
consent, or approval of any government or governmental agency in order to
consummate the transactions contemplated by this Agreement.

                  (iii) Buyer Notes, etc. Buyer has the corporate power and
authority to execute, issue and deliver the Buyer Notes and to perform its
obligations thereunder. The Buyer Notes have been duly authorized and, when
executed, issued and delivered to Sellers, will constitute the valid and binding

                                       4
<PAGE>

obligation of Buyer, enforceable against Buyer in accordance with its terms.

                  (iv) Noncontravention. The execution, delivery and performance
of this Agreement, the Buyer Notes, and the issuance of capital stock of Parent
will not (i) violate any statute, regulation, rule, injunction, judgment, order,
decree, ruling, charge, or other restriction of any government, governmental
agency, or court to which Buyer is subject or any provision of the charter or
bylaws of Buyer or (ii) result in a breach of, constitute a default under,
result in the acceleration or termination of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice or consent
(other than notices previously given or consents previously obtained) under any
agreement, contract, lease, license, instrument, or other arrangement to which
Buyer is a party or by which it is bound or to which any of its assets is
subject (or result in the imposition of any Security Interest upon any of its
assets). The issuance of capital stock of Parent will not breach or conflict
with any preemptive, first refusal or similar rights of any holder of Buyer's
securities.

                  (v) No Material Adverse Change. Since January 1, 1999, there
has not been any material adverse change in the business or financial condition
of the Buyer.

                  (vi) Brokers' Fees. Neither Buyer nor any of its Affiliates
have any liability or obligation to pay any fees or commissions to any broker,
finder, or agent with respect to the transactions contemplated by this Agreement
for which Sellers or any of its Affiliates could become liable or obligated.

                  (vii) Investment. Buyer is not acquiring the Company Shares
with a view to or for sale in connection with any distribution thereof within
the meaning of the Securities Act.

         Section 4. Representations and Warranties Concerning the Company.
Sellers represent and warrant to Buyer that the statements contained in this
Section 4 are true and correct as of the date of this Agreement.

         (a) Organization, Qualification, and Corporate Power. The Company is
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its organization. The Company is duly authorized to conduct
business and is in good standing under the laws of each jurisdiction where such
qualification is required, except where the lack of such qualification or good
standing would not materially interfere with the ability of the Company and its
Subsidiaries to conduct business or have a material adverse effect on the
Company. The Company has full corporate power and authority to carry on the
businesses in which it is engaged and to own and use the properties owned and
used by it.

         (b) Capitalization. The entire authorized capital stock of the Company
consists of 50,000 shares of common stock, par value $.01 per share, of which
5,001 shares are issued and outstanding. All of the issued and outstanding
Company Shares have been duly authorized, are validly issued, fully paid, and
nonassessable, and are held of record by Sellers. There are no outstanding or
authorized options, warrants, purchase rights, subscription rights, conversion
rights, exchange rights, or other contracts or commitments that could require
the Company to issue, sell, or otherwise cause to become outstanding any
additional shares of its capital stock. There are no outstanding or authorized
stock appreciation, phantom stock, profit participation, or similar rights
issued by the Company (or with respect to which the Company could be required to
make payments or issue any capital stock).

                                       5
<PAGE>

         (c) Noncontravention. Neither the execution and the delivery of this
Agreement, nor the consummation of the transactions contemplated hereby, will
(i) violate any statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge, or other restriction of any government, governmental agency, or
court to which the Company is subject or any provision of the charter or bylaws
of the Company or (ii) result in a breach of, constitute a default under, result
in the acceleration or termination in accordance with its terms of, create in
any party the right to accelerate, terminate, modify, or cancel, or require any
notice under any agreement, contract, lease, license, instrument, or other
arrangement to which the Company is a party or by which it is bound or to which
any of its assets is subject (or result in the imposition of any Security
Interest upon any of its assets), except where the violation, conflict, breach,
default, acceleration, termination, modification, cancellation, failure to give
notice, or Security Interest would not have a material adverse effect on the
Company or on the ability of the Parties to consummate the transactions
contemplated by this Agreement. The Company does not need to give any notice to,
make any filing with, or obtain any authorization, consent, or approval of any
government or governmental agency in order for the Parties to consummate the
transactions contemplated by this Agreement.

         (d) Brokers' Fees. The Company has no liability or obligation to pay
any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement.

         (e) Title to Personal Properties. The Company has good and marketable
title to, or a valid and effective right to use, all of their respective
personal properties, including all personal properties reflected on the Latest
Balance Sheet or acquired since the date of the Latest Balance Sheet (except
property disposed of subsequent to that date in the Ordinary Course of Business
and except other immaterial items). Such assets and properties are not subject
to any mortgage, pledge, lien, claim, encumbrance, charge, security interest or
title retention or other security arrangement except for liens for the payment
of federal, state and other taxes, the payment of which is neither delinquent
nor subject to penalties, and except for other liens and encumbrances incidental
to the conduct of the business of the Company and its Subsidiaries or the
ownership of their assets or properties which were not incurred in connection
with the borrowing of money or the obtaining of advances and which do not in the
aggregate materially detract from the value of the assets or properties of the
Company or materially impair the use thereof in the operation of the Business.
All leases pursuant to which the Company leases any substantial amount of
personal property are valid and effective in accordance with their respective
terms.

         (f) Events Subsequent to June 30, 1999.

                  (i) Since June 30, 1999, the Company has not (A) taken any
material action outside the Ordinary Course of Business; (B) borrowed any money;
(C) become contingently liable for any borrowings of another Person (or
guaranteed or become contingently liable for the performance of contractual
obligations of another Person); (D) failed to use its reasonable efforts to
preserve its business organization intact, to keep available the services of its
employees and independent contractors, or to preserve its relationships with its
customers, suppliers and other Persons with which it deals; or (E) increased or
committed to increase the salary or compensation of any officer.

                  (ii) Since June 30, 1999, the Company has not engaged in any
material practice, taken any material action or entered into any material
transaction outside the Ordinary Course of Business (other than the transactions
contemplated by this Agreement). Without limiting the generality of the
foregoing, since that date:

                                       6
<PAGE>

                           (A) there has been no change made or authorized in
the charter or bylaws of the Company;

                           (B) the Company has not issued, sold or otherwise
disposed of any of its capital stock, or granted any options, warrants or other
rights to purchase or obtain (including upon conversion, exchange or exercise)
any of its capital stock;

                           (C) the Company has not declared, set aside or paid
any dividend or made any distribution with respect to its capital stock (whether
in cash or in kind), or redeemed, purchased or otherwise acquired any of its
capital stock;

                           (D) the Company has not created, incurred, assumed or
guaranteed more than $100,000 in aggregate indebtedness for borrowed money and
capitalized lease obligations;

                           (E) the Company has not sold, leased, transferred or
assigned any material assets, tangible or intangible, outside the Ordinary
Course of Business;

                           (F) there has not been any material adverse change in
the financial condition, business, properties, assets or results of operations
of the Company (provided that no representation or warranty is made as to the
decline in the performance of the business experienced to date, the
circumstances or factors giving rise to such decline or any continuation of such
decline, circumstances or factors in the future, all of which risks are being
assumed by Buyer);

                           (G) there has not been any destruction, damage or
loss (whether or not covered by insurance) to the assets or properties of the
Company which materially affects or impairs the ability of the Company to
conduct its business;

                           (H) there has not been any mortgage or pledge of any
material amount of the assets or properties of the Company; and

                           (I) the Company has not committed to any of the
foregoing.

         (g) Compliance with Law and Other Related Regulations. Except in the
case of environmental, franchise and labor matters (which are exclusively
covered by the representations and warranties contained in Sections 4(q), (x)
and (y), respectively):

                  (i) The Company is in compliance with applicable laws within
the jurisdiction of its incorporation and all other jurisdictions in which the
Company is doing business, except where failure to comply would not have a
material adverse effect on the Company.

                  (ii) Without limiting the foregoing, the Company has properly
filed all material reports, paid all fees and obtained all material licenses,
permits, certificates and authorizations needed or required for the conduct of
its business and the use of its assets and properties and the premises occupied
by it in connection therewith and is in compliance in all material respects with
all conditions, restrictions and provisions of all such material licenses,
permits, certificates and authorizations.

                                       7

<PAGE>
         (h) Intellectual Property.

                  (i) Section 4(i) of the Disclosure Schedule identifies the
following owned or used by any of the Company: (A) patents and pending patent
applications; (B) trademark, service mark and trade name registrations and
applications therefor; (C) copyright registrations and applications therefor;
and (D) licenses and similar agreements for the use of any intellectual property
(including, without limitation, patents, unpatented inventions and technology,
trademarks, service marks and trade names, copyrights and copyrightable works,
know-how and trade secrets, hereinafter collectively referred to as
"Intellectual Property") to which the Company is a party, either as licensee or
licensor (other than licenses for the use of commercially available computer
software and related documentation).

                  (ii) The Company owns and possess all right, title and
interest in and to, or have a valid and enforceable license to use, the
Intellectual Property necessary for the operation of the Business and no written
claim by any third party contesting the validity, enforceability, use or
ownership of any of the Intellectual Property has been made or, to the Knowledge
of Sellers, threatened in the last three years or is currently outstanding.

         (i) Employee Benefits. The Company does not maintain any Employee
Benefit Plan for the benefit of its employees.

         (j) Certain Business Relationships With the Company and its
Subsidiaries. Neither the Sellers or its Affiliates (excluding for this purpose
the Company) own any material asset, tangible or intangible, which is used in
the business of, or provides any material service to, the Company.

         (k) Minute Books. The minute book of the Company accurately records all
material actions taken its shareholders and directors.

         (l) Accuracy of Statements. Neither this Agreement nor the Disclosure
Schedule contains an untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein or therein, in
light of the circumstances in which they are made, not misleading.

         Section 5. Pre-Closing Covenants. The Parties agree as follows with
respect to the period between the execution of this Agreement and the Closing.

         (a) General. Each of the Parties will use its reasonable efforts to
take all action and to do all things necessary, proper, or advisable in order to
consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the closing conditions set forth in
Section 7 below).

         (b) Notice of Developments.

                  (i) Sellers may elect at any time to notify Buyer in writing
of any development causing a breach of any of its representations and warranties
in Section 4 above. Unless Buyer has the right to terminate this Agreement
pursuant to Section 9(a)(ii) below by reason of the development and exercises
that right within the period of 10 business days referred to in Section 9(a)(ii)
below, the written notice pursuant to this Section 5(b)(i) will be deemed to
have amended the Disclosure Schedule, to have qualified the representations and
warranties contained in Section 4 above, and to have cured any misrepresentation
or breach of warranty that otherwise might have existed hereunder by reason of
the development, in each case to the extent of the disclosure contained in such
written notice.

                                       8
<PAGE>

                  (ii) Each Party will give prompt written notice to the other
of any development causing a breach of any of its own representations and
warranties in Section 3 above. No disclosure by any Party pursuant to this
Section 5(b)(ii), however, shall be deemed to amend or supplement the Disclosure
Schedule or to prevent or cure any misrepresentation or breach of warranty.

         (c) Exclusivity. The Sellers will not solicit, initiate, or encourage
the submission of any proposal or offer from any Person or enter into any
discussions, negotiations or agreements relating to the acquisition of all or
substantially all of the capital stock or assets of any of the Company and its
Subsidiaries (including any acquisition structured as a merger, consolidation,
or share exchange).

         (d) Covenants of Sellers. Sellers agree that, unless Buyer otherwise
agrees in writing and except as set forth in the Disclosure Schedule, prior to
the Closing Date:

                  (i) Truth of Representations and Warranties. Sellers shall use
reasonable efforts to assure that the Company does not take any action which
would render untrue in any material respect any of the representations or
warranties of Sellers herein contained, and Sellers shall use reasonable efforts
to assure that the Company does not omit to take any action, the omission of
which would render untrue in any material respect any such representation or
warranty. If the Closing occurs, Buyer shall not have any right of action or
remedy against Sellers for breach of this Section 5(d)(i).

                  (ii) Preservation of Business. Sellers shall cause the Company
to use its reasonable efforts to (i) preserve intact the present business
organization of the Company, (ii) preserve the present goodwill and
relationships of the Company with all Persons having business dealings with the
Company, and (iii) preserve and maintain in force all material licenses,
registrations, franchises, patents, trademarks, copyrights, bonds and other
similar rights of the Company. Sellers shall cause the Company to refrain from
entering into any employment agreements with any of their officers or management
personnel which may not be cancelled without penalty upon notice not exceeding
90 days.

                  (iii) Ordinary Course. Sellers shall use reasonable efforts to
not cause or permit the Company to engage in any material practice, take any
material action, or enter into any material transaction outside the Ordinary
Course of Business. Sellers shall use reasonable efforts to cause the Company to
operate their businesses only in the usual, regular and Ordinary Course of
Business and to maintain all supplies and inventory at levels commensurate with
those customarily maintained by the Company in the Ordinary Course of Business.
Sellers shall use reasonable efforts to cause the Company to operate their
businesses in material compliance with their contractual obligations. Without
limiting the foregoing, Sellers shall use reasonable efforts to assure that the
Company does not (i) place a Security Interest on any property or assets, (ii)
except in the Ordinary Course of Business, incur any material obligation
(contingent or otherwise), or purchases or acquires, or transfers or conveys,
any material assets or properties or enters into any material transaction, or
(iii) acquire any stock or other equity interest in any corporation, trust or
other entity.

                  (iv) Books and Records. Sellers shall cause the Company to
maintain its books, accounts and records in the usual, regular and ordinary
manner, and on a basis consistent with prior years.

                                       9
<PAGE>

                  (v) No Organizational Changes. Except as contemplated by this
Agreement, Sellers shall assure that the Company does not (i) amend its charter
or by-laws, (ii) make any change in its capital stock by reclassification,
subdivision, reorganization or otherwise, or (iii) merge or consolidate with any
other corporation, trust or entity or change the character of its business.

                  (vi) No Issuance of Shares, Options or Other Securities.
Sellers shall assure that the Company does not (i) issue any shares of capital
stock or (ii) grant any option, warrant or other right to purchase or to convert
any obligation into shares of capital stock.

                  (vii) Compensation. Sellers shall assure that the Company does
not (i) increase the compensation payable to any officer or to other management
personnel from the amount payable as of the date of this Agreement, except in
accordance with normal and customary practice, or (ii) introduce or change any
pension or profit sharing plan, or any other employee benefit arrangement,
except for insubstantial changes necessary to comply with the minimum
requirements of the Code or ERISA, or except as disclosed in the Disclosure
Schedule or as contemplated by this Agreement.

                  (viii) Dividends. Sellers shall assure that the Company does
not (i) declare, make or pay any dividend or other distribution with respect to
its capital stock or otherwise, (ii) purchase, redeem or otherwise acquire any
shares of its capital stock, or (iii) transfer, distribute or pay, directly or
indirectly, any assets or properties (other than money) to any shareholders of
the Company, except in each case as otherwise permitted in this Agreement.

                  (ix) Right of Inspection. Sellers shall cause the Company to
make available to Buyer and its representatives for inspection at all reasonable
times all of the assets, properties, facilities, records, agreements (including
all documents of any description evidencing any right or obligation of the
Company) and the consolidated financial statements of the Company and allow
Buyer and its representatives the right to make whatever copies of such
materials it requires, and Sellers shall cause the Company to permit Buyer and
its independent accountants to audit or make such audit tests respecting the
accounts of the Company as Buyer or its accountants consider appropriate.

                  (x) Entry Into Obligations. Sellers shall assure that the
Company does not (i) enter into any lease, contract, agreement or other
obligation with any Person other than contracts for the sale of products or
services and contracts for the purchase of supplies or services in the Ordinary
Course of Business (or, whether or not in the Ordinary Course of Business, which
involve obligations in excess of $10,000) or (ii) enter into any service
agreements, maintenance agreements, contracts or other arrangements relating to
the operation or maintenance of the Business other than in the Ordinary Course
of Business.

                  (xi) Confidentiality. Sellers shall assure that the Company
does not reveal, orally or in writing, to any Person, other than Buyer and its
representatives, any of the confidential business procedures or practices
followed by it in the conduct of its business or any other information of a
confidential nature.

                  (xii) Maintenance of Assets and Properties. Sellers shall use
reasonable efforts to cause the Company to keep the premises occupied by it and
all of the equipment and other tangible assets and personal property of the
Company and its Subsidiaries in substantially the same condition as on the date
of this Agreement. Sellers shall assure that the Company does not remove any

                                       10
<PAGE>

personal property from the Business unless same are replaced with similar items
of at least equal quality prior to the Closing Date. Sellers shall assure that
the Company does not sell or permit to be sold or otherwise transferred or
disposed of any material item or group of items constituting personal property,
except items sold in the Ordinary Course of Business. Sellers shall assure that
the Company does not convey any ownership or leasehold interest in the Business.

                  (xiii) Satisfaction of Obligations and Liabilities. Sellers
shall use reasonable efforts to cause the Company to (i) pay or cause to be paid
all of the obligations and liabilities arising out of its business as they
mature, other than immaterial items disputed in good faith by Sellers or other
items disputed with the written approval of Buyer, (ii) maintain in all material
respects and perform in all material respects its obligations under all
agreements and contracts to which it is bound in a manner consistent with past
practice, and (iii) comply in all material respects with all requirements of
applicable laws within the jurisdiction of its incorporation and all other
jurisdictions in which the Company is doing business in a manner consistent with
past practice. Sellers shall cause the Company to pay or cause to be paid in
full when due all bills and invoices for labor, goods, materials, services and
utilities of any kind relating to the Business which were contracted for by the
Company or which were delivered to or performed on the Business other than
immaterial items disputed by Sellers or other items disputed with the written
approval of Buyer.

         Section 6. Post-Closing Covenants. The Parties agree as follows with
respect to the period following the Closing.

         (a) General. In case at any time after the Closing any further
reasonable action is necessary to carry out the purposes of this Agreement, each
of the Parties will take such further action (including the execution and
delivery of such further instruments and documents) as any other Party may
reasonably request, all at the sole cost and expense of the requesting Party
(unless the requesting Party is entitled to indemnification therefor under
Section 8 below).

         (b) Litigation Support. In the event and for so long as any Party
actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand in connection with
(i) any transaction contemplated under this Agreement or (ii) any fact,
situation, circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act, or transaction on or prior
to the Closing Date involving each of the other Parties shall cooperate with
such Party or its counsel in the defense or contest, make available their
personnel, and provide such testimony and access to their books and records as
shall be necessary in connection with the defense or contest, all at the sole
cost and expense of the contesting or defending Party (unless the contesting or
defending Party is entitled to indemnification therefor under Section 8 below).

         (c) Transition. The Sellers will not take any action that is designed
or intended to have the effect of discouraging any lessor, licensor, customer,
supplier, or other business associate of the Company from maintaining the same
business relationships after the Closing as it maintained with the Company prior
to the Closing.

         (d) Prepayment of Buyer Notes. Buyer will use its reasonable efforts to
pay the outstanding Principal amount of the Buyer Notes plus all accrued and
unpaid interest thereon prior to maturity.

                                       11

<PAGE>

         Section 7. Conditions to Obligation to Close.

         (a) Conditions to Obligation of Buyer. The obligation of Buyer to
consummate the transactions to be performed by it in connection with the Closing
is subject to satisfaction of the following conditions:

                  (i) the representations and warranties of Sellers herein
contained shall have been true and correct in all material respects when made
and, in addition, shall be true and correct in all material respects on and as
of the Closing Date with the same force and effect as though made on and as of
the Closing Date, except as affected by transactions contemplated hereby;

                  (ii) Sellers shall have in all material respects performed all
obligations and agreements and complied in all material respects with all their
covenants and conditions contained in this Agreement to be performed and
complied with by them or on or prior to the Closing Date;

                  (iii) there shall be no material adverse change in the
business, properties or financial condition of the Company (other than any
material adverse change resulting from or relating to (A) the decline in the
performance of the business experienced to date, the circumstances or factors
giving rise to such decline or any continuation of such decline, circumstances
or factors in the future or (B) any actions taken or announced by Buyer in
connection with the transactions contemplated by this Agreement or any reaction
of employees or business relations of the Company to the transactions
contemplated by this Agreement, all of which risks are being assumed by the
Buyer);

                  (iv) (A) no action or proceeding before any court or
governmental agency shall have been instituted or threatened which would enjoin,
restrain or prohibit (or which seeks substantial damages as a result of or in
connection with) the transactions contemplated by this Agreement and which would
in the reasonable judgment of Buyer make it inadvisable to consummate such
transactions and (B) no court order shall have been entered in any action or
proceeding instituted by any other Person which enjoins, restrains or prohibits
the consummation of the transactions contemplated by this Agreement;

                  (v) Buyer shall have received from counsel to Sellers an
opinion in form and substance as set forth in Exhibit B attached hereto,
addressed to Buyer, and dated as of the Closing Date;

                  (vi) Buyer shall have received from LLC a certificate signed
by the Chief Manager and Secretary and from the individual Sellers, dated the
date of the Closing Date, certifying that the closing conditions set forth in
Sections 7(a)(i), (ii) and (vii) are satisfied; and

                  (vii) all other documents required to be delivered by Sellers,
the Company or its Subsidiaries under this Agreement at or prior to the Closing
Date shall be delivered or shall be tendered by the Closing Date.

Buyer may waive any condition specified in this Section 7(a).

         (b) Conditions to Obligation of Sellers. The obligation of Sellers to
consummate the transactions to be performed by them in connection with the
Closing is subject to satisfaction of the following conditions:

                  (i) the representations and warranties of Buyer herein
contained shall have been true and correct in all material respects when made
and, in addition, shall be true and correct in all material respects on and as

                                       12
<PAGE>

of the Closing Date with the same force and effect as though made on and as of
the Closing Date, except as affected by transactions contemplated hereby;

                  (ii) Buyer shall have in all material respects performed all
obligations and agreements and complied in all material respects with all their
covenants and conditions contained in this Agreement to be performed and
complied with by them on or prior to the Closing Date;

                  (iii) no action or proceeding before any court or governmental
agency shall have been instituted or threatened which would enjoin, restrain or
prohibit (or seeks substantial damages as a result of or in connection with) the
transactions contemplated by this Agreement and which would in the reasonable
judgment of Sellers make it inadvisable to consummate such transactions, and no
court order shall have been entered in any action or proceeding instituted by
any other Person which enjoins, restrains or prohibits the consummation of the
transactions contemplated by this Agreement;

                  (iv) Buyer shall have executed and delivered the Buyer Notes;

                  (v) Sellers shall have received from counsel to Buyer an
opinion in form and substance as set forth in Exhibit C attached hereto,
addressed to Sellers, and dated as of the Closing Date;

                  (vi) Sellers shall have received from Buyer a certificate of
the president and secretary of Buyer, dated as of the Closing Date, certifying
that the closing conditions set forth in Sections 7(b)(i), (ii), (iv), (v) and
(vii) are satisfied; and

                  (vii) all other documents required to be delivered by Buyer
under this Agreement at or prior to the Closing Date shall be delivered or shall
be tendered by the Closing Date.

Sellers may waive any condition specified in this Section 7(b).

         Section 8. Remedies for Breaches of This Agreement.

         (a) Survival of Representations and Warranties. All of the
representations and warranties of the Parties contained in Sections 3 and 4
above shall survive the Closing hereunder and shall continue in full force and
effect for a period of one year thereafter.

         (b) Indemnification Provisions for Benefit of Buyer.

                  (i) In the event that (A) the Sellers breach any
representation or warranty contained herein and (B) Buyer makes a written claim
for indemnification against Sellers with respect thereto within one year after
the Closing (which written claim shall specify in reasonable particulars the
basis of the breach being asserted and, to the extent then determinable, a
calculation of any Adverse Consequences which Buyer claims to suffer as a result
thereof), then the Sellers agree to indemnify Buyer from and against any Adverse
Consequences Buyer suffers which are proximately caused by the breach; provided,
however, that Sellers shall not have any obligation to indemnify Buyer from and
against any Adverse Consequences caused by the breach of any representation or
warranty of Sellers contained in Section 4 above unless and until Buyer has
suffered Adverse Consequences in excess of a $25,000 deductible per occurrence

                                       13
<PAGE>

(after which point Sellers will be obligated only to indemnify Buyer from and
against further Adverse Consequences associated with the occurrence in
question).

                  (ii) Sellers shall indemnify Buyer and its Affiliates from and
against any Adverse Consequences which it suffers in connection with any action,
suit or proceeding brought by any franchisee of the Company or its Subsidiaries
if and to the extent that such action, suit or proceeding seeks relief in
respect of actions or omissions which occur prior to the Closing; provided that
(A) a $25,000 per occurrence deductible shall apply to indemnification claims
under this Section 8(b)(ii); (B) Sellers shall not be obligated to indemnify
Buyer or its Affiliates in respect of any actions or omissions of Buyer or its
Affiliates at any time before or after the Closing or any actions or omissions
of the Company or its Subsidiaries after the Closing; and (C) Sellers shall not
be obligated to indemnify Buyer or its Affiliates in respect of any actions,
suits or proceedings if and to the extent they relate to the identity, finances
or business strategy of Buyer or its Affiliates.

                  (iii) Any indemnification for Adverse Consequences suffered by
Buyer or its Affiliates shall first be paid by reducing pro rata the outstanding
principal amount of the Buyer Note; provided, however, that no such reduction
shall occur unless (A) Buyer has made its claim for indemnification in
accordance with this Section 8(b) and (B) Sellers has agreed to such claim or,
if Sellers does not so agree, Buyer has obtained a judgement in favor of Buyer
from a court of competent jurisdiction. Buyer and its Affiliates shall not be
entitled to payment in cash for any claim for indemnification unless and until
(C) the principal amount of the Buyer Note has been repaid and/or canceled in
full (or reduced to zero pursuant to this Section 8(b)(iii)) or (D) Sellers has
transferred the Buyer Notes to any Person.

         (c) Indemnification Provisions for Benefit of Sellers.

                  (i) In the event (A) Buyer breaches any representation or
warranty contained in Section 3 above and (B) Sellers make a written claim for
indemnification against Buyer with respect thereto within one year after the
Closing (which written claim shall specify in reasonable particulars the basis
of the breach being asserted and, to the extent then determinable, a calculation
of any Adverse Consequences which Sellers claims to suffer as a result thereof),
then Buyer agrees to indemnify Sellers from and against any Adverse Consequences
Sellers suffers through and after the date of the claim for indemnification
proximately caused by the breach.

                  (ii) Except in the case of matters for which Buyer is entitled
to indemnification from Sellers under Section 8(b) above, in the event that
Sellers or any of LLC's Affiliates are named as a party to any action, suit or
proceeding arising from, relating to or in connection with any actions or
omissions of the Company (whether before or after the Closing Date), then Buyer
shall fully indemnify and hold harmless Sellers and any of LLC's Affiliates from
all Adverse Consequences in connection therewith.

         (d) Matters Involving Third Parties.

                  (i) If any third party shall notify any Party (the
"Indemnified Party") with respect to any matter (a "Third Party Claim") which
may give rise to a claim for indemnification against any other Party (the
"Indemnifying Party") under this Section 8, then the Indemnified Party shall
promptly (and in any event within 5 business days after receiving notice of the
Third Party Claim) notify each Indemnifying Party thereof in writing; provided,
however, that failure to provide such notice on a timely basis shall not release

                                       14
<PAGE>

the Indemnifying Party from any of its obligations under this Section 8 except
to the extent the Indemnifying Party is materially prejudiced by such failure.

                  (ii) The Indemnifying Party will have the right at any time to
assume and thereafter conduct the defense of the Third Party Claim with counsel
of its choice; provided, however, that the Indemnifying Party will not consent
to the entry of any judgment or enter into any settlement with respect to the
Third Party Claim without the prior written consent of the Indemnified Party
(not to be unreasonably withheld or delayed) unless the judgment or proposed
settlement involves only the payment of money damages by the Indemnifying Party
and does not impose an injunction or other equitable relief upon the Indemnified
Party.

                  (iii) Unless and until the Indemnifying Party assumes the
defense of the Third Party Claim as provided in Section 8(d)(ii) above, the
Indemnified Party may defend against the Third Party Claim in any manner it
reasonably may deem appropriate.

                  (iv) In no event will the Indemnified Party consent to the
entry of any judgment or enter into any settlement with respect to the Third
Party Claim without the prior written consent of each of the Indemnifying
Parties (not to be unreasonably withheld or delayed).

                  (v) In the event that any Party suffers damage or loss in
respect of which it has or makes a valid claim against another Party for
indemnification, it must take reasonable steps to mitigate its loss or damage.

         Section 9. Termination.

         (a) Termination of Agreement. This Agreement may be terminated as
provided below:

                  (i) Buyer and Sellers may terminate this Agreement by mutual
written consent at any time prior to the Closing;

                  (ii) Buyer may terminate this Agreement by giving written
notice to Sellers at any time prior to the Closing in the event that (A) Sellers
have within the previous 10 business days given the Buyer any notice pursuant to
Section 5(b)(i) above and (B) the development that is the subject of the notice
(taken together with developments which were the subject of any previous notices
pursuant to Section 5(b)(i)) has had a material adverse effect upon the Company
and its Subsidiaries taken as a whole (other than any material adverse effect
resulting from or relating to (1) the decline in the performance of the business
(including but not limited to the decline in comparable store sales) experienced
to date, the circumstances or factors giving rise to such decline or any
continuation of such decline, circumstances or factors in the future, (2) any
pending or threatened litigation by or on behalf of franchisees or (3) any
actions taken or announced by Buyer in connection with the transactions
contemplated by this Agreement or any reaction of employees or business
relations of the Company or its Subsidiaries to the transactions contemplated by
this Agreement, all of which risks are being assumed by the Buyer);

                  (iii) Buyer may terminate this Agreement by giving written
notice to Sellers at any time prior to the Closing (A) in the event that (1)
Sellers have breached any representation, warranty or covenant contained in this
Agreement, (2) such breach would have a material adverse effect on the Company
and its Subsidiaries taken as a whole, (3) Buyer has notified Sellers in writing
of such breach and (4) such breach has continued without cure for a period of 30

                                       15
<PAGE>

days after the notice of breach or (B) if the Closing shall not have occurred on
or before October 31, 1999 by reason of the failure of any condition precedent
under Section 7(a) hereof (unless the failure results primarily from Buyer
breaching any representation, warranty or covenant contained in this Agreement);
and

                  (iv) Sellers may terminate this Agreement by giving written
notice to Buyer at any time prior to the Closing (A) in the event that (1) Buyer
has breached any representation, warranty or covenant contained in this
Agreement, (2) such breach would have a material adverse effect on Buyer, (3)
Sellers has notified Buyer in writing of such breach, and (4) such breach has
continued without cure for a period of 30 days after the notice of breach or (B)
if the Closing shall not have occurred on or before October 31, 1999 by reason
of the failure of any condition precedent under Section 7(b) hereof (unless the
failure results primarily from Sellers breaching any representation, warranty or
covenant contained in this Agreement).

         (b) Effect of Termination. If either Party terminates this Agreement
pursuant to Section 9(a) above, all rights and obligations of the Parties
hereunder shall terminate without any liability of any Party to any other Party
(except for any liability of any Party which has committed a willful breach
hereof or any Party which fails to consummate the Closing notwithstanding the
fact that (1) all of the conditions running in its favor under Section 7 hereof
have been satisfied and (2) all of the conditions running in the favor of the
other Party under Section 7 have been satisfied or waived); provided, however,
that the Confidentiality Agreement shall survive termination.

         Section 10.  Miscellaneous.

         (a) Press Releases and Public Announcements. No Party shall issue any
press release or make any public announcement relating to the subject matter of
this Agreement prior to the Closing without the prior written approval of the
other Party; provided, however, that either Party may make any public disclosure
it believes in good faith is required by applicable law, the regulations of the
SEC, or any listing or trading agreement concerning its publicly-traded
securities (in which case the disclosing Party will use its reasonable efforts
to consult the other Party prior to making the disclosure).

         (b) No Third Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any Person other than the Parties and their respective
successors and permitted assigns.

         (c) Entire Agreement. This Agreement (including the exhibits and
schedules hereto referred to herein) constitutes the entire agreement between
the Parties and supersedes any prior understandings, agreements, or
representations by or between the Parties, written or oral, to the extent they
related in any way to the subject matter hereof.

         (d) Succession and Assignment. This Agreement shall be binding upon and
inure to the benefit of the Parties named herein and their respective successors
and permitted assigns and heirs. No Party may assign either this Agreement or
any of its rights, interests, or obligations hereunder without the prior written
approval of the other Party; provided, however, that any Party may (i) assign
any or all of its rights and interests hereunder to one or more of its
Affiliates and (ii) designate one or more of its Affiliates to perform its
obligations hereunder (in any or all of which cases the assigning Party
nonetheless shall remain responsible for the performance of all of its
obligations hereunder).

                                       16
<PAGE>

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

         (f) Headings. The Section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.

         (g) Notices. All notices, requests, demands, claims, and other
communications hereunder will be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be deemed duly given if (and then five
business days after) it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
<TABLE>
<CAPTION>
<S>      <C>                                                       <C>
         If to Sellers:                                            Copy to:

         J. D. Jenkins
         913 Glensprings Drive
         Knoxville, TN 37922

         Ron Jenkins
         5000 Cloverhill Lane
         Knoxville, TN 37922

         Shady Dale Investments, LLC.                              Morris, Manning & Martin
         2239 Goode Rd.                                            3343 Peachtree Rd., N.E.
         Conyers, GA 30094                                         1600 Atlanta Financial Center
         Attn: President                                           Atlanta, GA 30326
                                                                   Attn: Oby T. Brewer, Esq.

         If to Buyer:                                              Copy to:

         iCommerce Group, Inc.                                     Stone & Hinds, PC
         6312 Baum Drive                                           700 First American Center
         Knoxville, TN 37919                                       507 Gay Street, S.W.
                                                                   Knoxville, TN 37902
                                                                   Attn: Maurice W. Gerard
</TABLE>

Either Party may send any notice, request, demand, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service,
telecopy, telex, ordinary mail, or electronic mail), but no such notice,
request, demand, claim, or other communication shall 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 Party
notice in the manner herein set forth.

         (h) Governing Law. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Tennessee without giving
effect to any choice or conflict of law provision or rule (whether of the State
of Tennessee or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Tennessee.

                                       17
<PAGE>

         (i) Amendments and Waivers. No amendment of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by duly
authorized representatives of Buyer and Sellers. No waiver by any Party of any
default, misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any such prior or subsequent
occurrence.

         (j) Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation or in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.

         (k) Expenses. Each of Buyer and Sellers will bear its own costs and
expenses (including legal fees and expenses) incurred in connection with this
Agreement and the transactions contemplated hereby.

         (l) Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation.

         (m) Incorporation of Exhibits and Schedules. The Exhibits and Schedules
identified in this Agreement are incorporated herein by reference and made a
part hereof.

         (n) Confidentiality. Following the Closing, Sellers and its Affiliates
shall maintain the confidentiality of all nonpublic information concerning the
Company and its Subsidiaries; provided that Sellers and its Affiliates shall be
entitled to use and/or disclose relevant portions of such information for tax,
accounting and financial reporting purposes and in connection with the
enforcement of their rights under this Agreement.

                                       18
<PAGE>

                                   * * * * * *

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

                                       iCOMMERCE GROUP, INC.

                                       By:  _______________________________
                                             Title:

                                       J. D. JENKINS

                                       By:  _______________________________
                                             An Individual

                                       RON JENKINS

                                       By:  _______________________________
                                              An Individual

                                       SHADY DALE INVESTMENTS, LLC

                                       By:  _______________________________
                                             Title:

                                       19

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