Document:

exhibit_10-24.htm

    
      

    

    Exhibit
      10.24

     

    

     

    WARRANT

     

    THE
      SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
      LAWS.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE
      OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
      REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933,
      AS
      AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION OF COUNSEL IN A
      FORM
      REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT REQUIRED UNDER
      SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE
      144
      UNDER SAID ACT.  NOTWITHSTANDING THE FOREGOING, THIS WARRANT MAY BE
      PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT.

     

     

    C-MARK
      INTERNATIONAL, INC.

     

    Warrant
      To Purchase Common Stock

     

    
      
        	 Warrant
                No.: 113W	
                 Number
                  of Shares: 500,000

              

      

    

     

    Date
      of
      Issuance:  June 21, 2007

    

    C-Mark
      International, Inc., a South Carolina corporation (the “Company”), hereby
      certifies that, for Ten United States Dollars ($10.00) and other good and
      valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged, Trafalgar Capital Specialized Investment Fund, Luxembourg,
      (“Trafalgar”), the registered holder hereof or its permitted assigns, is
      entitled, subject to the terms set forth below, to purchase from the Company
      upon surrender of this Warrant, at any time or times on or after the date
      hereof, but not after 11:59 P.M. Eastern Time on the Expiration Date (as
      defined herein) five hundred thousand (500,000) fully paid and nonassessable
      shares of Common Stock (as defined herein) of the Company (the “Warrant
      Shares”) at the exercise price per share provided in Section 1(b) below
      or as subsequently adjusted; provided, however, that in no event shall the
      holder be entitled to exercise this Warrant for a number of Warrant Shares
      in
      excess of that number of Warrant Shares which, upon giving effect to such
      exercise, would cause the aggregate number of shares of Common Stock
      beneficially owned by the holder and its affiliates to exceed 4.99% of the
      outstanding shares of the Common Stock following such exercise, except within
      sixty (60) days of the Expiration Date.  For purposes of the foregoing
      proviso, the aggregate number of shares of Common Stock beneficially owned
      by
      the holder and its affiliates shall include the number of shares of Common
      Stock
      issuable upon exercise of this Warrant with respect to which the determination
      of such proviso is being made, but shall exclude shares of Common Stock which
      would be issuable upon (i) exercise of the remaining, unexercised Warrants
      beneficially owned by the holder and its affiliates and (ii) exercise or
      conversion of the unexercised or unconverted portion of any other securities
      of
      the Company beneficially owned by the holder and its affiliates (including,
      without limitation, any convertible notes or preferred stock) subject to a
      limitation on conversion or exercise analogous to the limitation contained
      herein.  Except as set forth in the preceding sentence, for purposes
      of this paragraph, beneficial ownership shall be calculated in accordance with
      Section 13(d) of the Securities Exchange Act of 1934, as amended.  For
      purposes of this Warrant, in determining the number of outstanding shares of
      Common Stock a holder may rely on the number of outstanding shares of Common
      Stock as reflected in (1) the Company’s most recent Form 10-QSB or Form 10-KSB,
      as the case may be, (2) a more recent public announcement by the Company or
      (3)
      any other notice by the Company or its transfer agent setting forth the number
      of shares of Common Stock outstanding.  Upon the written request of
      any holder, the Company shall promptly, but in no event later than one (1)
      Business Day following the receipt of such notice, confirm in writing to any
      such holder the number of shares of Common Stock then outstanding.  In
      any case, the number of outstanding shares of Common Stock shall be determined
      after giving effect to the exercise of Warrants (as defined below) by such
      holder and its affiliates since the date as of which such number of outstanding
      shares of Common Stock was reported.

     

    

    
      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

    

    

     

     

    Section
      1.

     

    (a)           This
      Warrant is a common stock purchase warrant (the “Warrant”) issued
      pursuant to an amendment to that certain secured convertible debenture
      originally issued on May 15, 2007 from the Company to  Trafalgar (the
“Convertible Debenture”).

     

    (b)           Definitions.  The
      following words and terms as used in this Warrant shall have the following
      meanings:

     

    (i)           “Approved
      Stock Plan” means any employee benefit plan which has been approved by the
      Board of Directors of the Company, pursuant to which the Company’s securities
      may be issued to any employee, officer or director for services provided to
      the
      Company.

     

    (ii)           “Business
      Day” means any day other than Saturday, Sunday or other day on which
      commercial banks in the City of New York are authorized or required by law
      to
      remain closed.

     

    (iii)           “Closing
      Bid Price” means the closing bid price of Common Stock as quoted on the
      Principal Market (as reported by Bloomberg Financial Markets
      (“Bloomberg”) through its “Volume at Price” function).

     

    (iv)           “Common
      Stock” means (i) the Company’s common stock, par value $.0001 per
      share, and (ii) any capital stock into which such Common Stock shall have
      been changed or any capital stock resulting from a reclassification of such
      Common Stock.

     

    (v)           “Excluded
      Securities” means, provided such security is issued at a price which is
      greater than or equal to the arithmetic average of the Closing Bid Prices of
      the
      Common Stock for the ten (10) consecutive trading days immediately preceding
      the
      date of issuance, any of the following: (a) any issuance by the Company of
      securities in connection with a strategic partnership or a joint venture (the
      primary purpose of which is not to raise equity capital), (b) any issuance
      by
      the Company of securities as consideration for a merger or consolidation or
      the
      acquisition of a business, product, license, or other assets of another person
      or entity and (c) options to purchase shares of Common Stock, provided (I)
      such
      options are issued after the date of this Warrant to employees of the Company
      within thirty (30) days of such employee’s starting his employment with the
      Company, and (II) the exercise price of such options is not less than the
      Closing Bid Price of the Common Stock on the date of issuance of such
      option.

     

    

    
      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

    

     

     

    (vi)           “Expiration
      Date” means the date five (5) years from the Issuance Date of this Warrant
      or, if such date falls on a Saturday, Sunday or other day on which banks are
      required or authorized to be closed in the City of New York or the State of
      New
      York or on which trading does not take place on the Principal Exchange or
      automated quotation system on which the Common Stock is traded (a
“Holiday”), the next date that is not a Holiday.

     

    (vii)           “Issuance
      Date” means the date hereof.

     

    (viii)          “Options”
      means any rights, warrants or options to subscribe for or purchase Common Stock
      or Convertible Securities.

     

    (ix)         
        “Other Securities” means (i) those options and warrants
      of the Company issued prior to, and outstanding on, the Issuance Date of this
      Warrant, (ii) the shares of Common Stock issuable on exercise of such options
      and warrants, provided such options and warrants are not amended after the
      Issuance Date of this Warrant and (iii) the shares of Common Stock issuable
      upon exercise of this Warrant.

     

    (x)           “Person”
      means an individual, a limited liability company, a partnership, a joint
      venture, a corporation, a trust, an unincorporated organization and a government
      or any department or agency thereof.

     

    (xi)           “Principal
      Market” means the New York Stock Exchange, the American Stock Exchange, the
      Nasdaq National Market, the Nasdaq SmallCap Market, whichever is at the time
      the
      principal trading exchange or market for such security, or the over-the-counter
      market on the electronic bulletin board for such security as reported by
      Bloomberg or, if no bid or sale information is reported for such security by
      Bloomberg, then the average of the bid prices of each of the market makers
      for
      such security as reported in the “pink sheets” by the National Quotation Bureau,
      Inc.

     

    (xii)           “Securities
      Act” means the Securities Act of 1933, as amended.

     

    (xiii)           “Warrant”
      means this Warrant and all Warrants issued in exchange, transfer or replacement
      thereof.

     

    (xiv)           “Warrant
      Exercise Price” shall be $.10 per share or as subsequently adjusted as
      provided in Section 8 hereof.

     

    (xv)           “Warrant
      Shares” means the shares of Common Stock issuable at any time upon exercise
      of this Warrant.

     

    

    
      
        
          
          

        

        
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    (c)           Other
      Definitional Provisions.

     

    (i)           Except
      as otherwise specified herein, all references herein (A) to the Company
      shall be deemed to include the Company’s successors and (B) to any
      applicable law defined or referred to herein shall be deemed references to
      such
      applicable law as the same may have been or may be amended or supplemented
      from
      time to time.

     

    (ii)           When
      used in this Warrant, the words “herein”, “hereof”, and
“hereunder” and words of similar import, shall
      refer to
      this Warrant as a whole and not to any provision of this Warrant, and the words
      “Section”, “Schedule”, and “Exhibit” shall refer to
      Sections of, and Schedules and Exhibits to, this Warrant unless otherwise
      specified.

     

    (iii)           Whenever
      the context so requires, the neuter gender includes the masculine or feminine,
      and the singular number includes the plural, and vice versa.

     

    Section
      2.     Exercise of
      Warrant.  Subject to the terms and conditions hereof, this Warrant
      may be exercised by the holder hereof then registered on the books of the
      Company, pro rata as hereinafter provided, at any time on any Business Day
      on or
      after the opening of business on such Business Day, commencing with the first
      day after the date hereof, and prior to 11:59 P.M. Eastern Time on the
      Expiration Date, by (i) delivery of a written notice, in the form of the
      subscription notice attached as Exhibit A hereto (the “Exercise
      Notice”), of such holder’s election to exercise this Warrant, which notice
      shall specify the number of Warrant Shares to be purchased, (ii) payment to
      the Company of an amount equal to the Warrant Exercise Price(s) applicable
      to
      the Warrant Shares being purchased, multiplied by the number of Warrant
      Shares (at the applicable Warrant Exercise Price) as to which this Warrant
      is being exercised (plus any applicable issue or transfer taxes) (the
“Aggregate Exercise Price”): (a) in cash or wire transfer of immediately
      available funds, (b) using shares of Common Stock of the Company having a fair
      market value equal to the Aggregate Exercise Price, or (c) by delivery of a
      written notice of Net Exercise, as defined in the following paragraph and (iii)
      the surrender of this Warrant (or an indemnification undertaking with respect
      to
      this Warrant in the case of its loss, theft or destruction) to a common carrier
      for overnight delivery to the Company as soon as practicable following such
      date.  In the event of any exercise of the rights represented by this
      Warrant in compliance with this Section 2(a), the Company shall on the
      fifth (5th) Business Day following the date of receipt of the Exercise
      Notice, the Aggregate Exercise Price and this Warrant (or an indemnification
      undertaking with respect to this Warrant in the case of its loss, theft or
      destruction) and the receipt of the representations of the holder specified
      in
      Section 6 hereof, if requested by the Company (the “Exercise Delivery
      Documents”), and if the Common Stock is DTC eligible credit such aggregate
      number of shares of Common Stock to which the holder shall be entitled to the
      holder’s or its designee’s balance account with The Depository Trust Company;
      provided, however, if the holder who submitted the Exercise Notice requested
      physical delivery of any or all of the Warrant Shares, or, if the Common Stock
      is not DTC eligible  then the Company shall, on or before the
      fifth (5th) Business
      Day
      following receipt of the Exercise Delivery Documents, issue and surrender to
      a
      common carrier for overnight delivery to the address specified in the Exercise
      Notice, a certificate, registered in the name of the holder, for the number
      of
      shares of Common Stock to which the holder shall be entitled pursuant to such
      request.  Upon delivery of the Exercise Notice and Aggregate Exercise
      Price referred to in clause (ii) above the holder of this Warrant shall be
      deemed for all corporate purposes to have become the holder of record of the
      Warrant Shares with respect to which this Warrant has been
      exercised.  In the case of a dispute as to the determination of the
      Warrant Exercise Price, the Closing Bid Price or the arithmetic calculation
      of
      the Warrant Shares, the Company shall promptly issue to the holder the number
      of
      Warrant Shares that is not disputed and shall submit the disputed determinations
      or arithmetic calculations to the holder via facsimile within one (1) Business
      Day of receipt of the holder’s Exercise Notice.  If the holder and the
      Company are unable to agree upon the determination of the Warrant Exercise
      Price
      or arithmetic calculation of the Warrant Shares within one (1) day of such
      disputed determination or arithmetic calculation being submitted to the holder,
      then the Company shall immediately submit via facsimile (i) the disputed
      determination of the Warrant Exercise Price or the Closing Bid Price to an
      independent, reputable investment banking firm or (ii) the disputed arithmetic
      calculation of the Warrant Shares to its independent, outside
      accountant.  The Company shall cause the investment banking firm or
      the accountant, as the case may be, to perform the determinations or
      calculations and notify the Company and the holder of the results no later
      than
      forty-eight (48) hours from the time it receives the disputed determinations
      or
      calculations.  Such investment banking firm’s or accountant’s
      determination or calculation, as the case may be, shall be deemed conclusive
      absent manifest error.

     

    

    
      
        
          
          

        

        
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    In
      lieu
      of exercising this Warrant via cash payment or delivery of shares, holder may
      elect to receive shares equal to the value of this Warrant (or portion thereof
      being exercised) by surrender of this Warrant at the principal office of the
      Company together with notice of election to exercise by means of a Net Exercise
      in which event the Company shall issue to holder a number of shares of the
      Company computed using the following formula:

     

     

     

    
      	 	 X= 	 Y(A-B)_
	 	 	   
              A
	 	 	 
	 	 Where
              X = 	 the
              number of shares of Common Stock to be issued to the holder
	 	 	 
	 	 Y
              =  	
               the
                number of shares of Common Stock purchasable under this Warrant or,
                if
                only a portion of this Warrant is being exercised, the portion of
                this
                Warrant being exercised (at the date of such
                calculation)

            
	 	 	 
	 	 A
              =	 the
              Fair Market Value of one share of the Company’s Common Stock (at the date
              of such calculation)
	 	 	 
	 	 B
              = 	 the
              Exercise Price per share (as adjusted to the date of such
              calculation).

    

     

     

    (a)           Unless
      the rights represented by this Warrant shall have expired or shall have been
      fully exercised, the Company shall, as soon as practicable and in no event
      later
      than five (5) Business Days after any exercise and at its own expense, issue
      a
      new Warrant identical in all respects to this Warrant exercised except it shall
      represent rights to purchase the number of Warrant Shares purchasable
      immediately prior to such exercise under this Warrant exercised, less the number
      of Warrant Shares with respect to which such Warrant is exercised.

     

    

    
      
        
          
          

        

        
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    (b)           No
      fractional Warrant Shares are to be issued upon any pro rata exercise of this
      Warrant, but rather the number of Warrant Shares issued upon such exercise
      of
      this Warrant shall be rounded up or down to the nearest whole
      number.

     

    (c)           If
      the Company or its Transfer Agent shall fail for any reason or for no reason
      to
      issue to the holder within ten (10) days of receipt of the Exercise
      Delivery Documents, a certificate for the number of Warrant Shares to which
      the
      holder is entitled or to credit the holder’s balance account with The Depository
      Trust Company for such number of Warrant Shares to which the holder is entitled
      upon the holder’s exercise of this Warrant, the Company shall, in addition to
      any other remedies under this Warrant or the Placement Agent Agreement or
      otherwise available to such holder, pay as additional damages in cash to such
      holder on each day the issuance of such certificate for Warrant Shares is not
      timely effected an amount equal to 0.025% of the product of (A) the sum of
      the
      number of Warrant Shares not issued to the holder on a timely basis and to
      which
      the holder is entitled, and (B) the Closing Bid Price of the Common Stock for
      the trading day immediately preceding the last possible date which the Company
      could have issued such Common Stock to the holder without violating this
      Section 2.

     

    (d)           If
      within ten (10) days after the Company’s receipt of the Exercise Delivery
      Documents, the Company fails to deliver a new Warrant to the holder for the
      number of Warrant Shares to which such holder is entitled pursuant to Section
      2
      hereof, then, in addition to any other available remedies under this Warrant
      or
      the Placement Agent Agreement, or otherwise available to such holder, the
      Company shall pay as additional damages in cash to such holder on each day
      after
      such tenth (10th) day that
      such
      delivery of such new Warrant is not timely effected in an amount equal to 0.25%
      of the product of (A) the number of Warrant Shares represented by the
      portion of this Warrant which is not being exercised and (B) the Closing
      Bid Price of the Common Stock for the trading day immediately preceding the
      last
      possible date which the Company could have issued such Warrant to the holder
      without violating this Section 2.

     

    Section
      3.     Covenants as to
      Common Stock.  The Company hereby covenants and agrees as
      follows:

     

    (a)           This
      Warrant is, and any Warrants issued in substitution for or replacement of this
      Warrant will upon issuance be, duly authorized and validly issued.

     

    (b)           All
      Warrant Shares which may be issued upon the exercise of the rights represented
      by this Warrant will, upon issuance, be validly issued, fully paid and
      nonassessable and free from all taxes, liens and charges with respect to the
      issue thereof.

     

    (c)           During
      the period within which the rights represented by this Warrant may be exercised,
      the Company will at all times have authorized and reserved at least one hundred
      percent (100%) of the number of shares of Common Stock needed to provide for
      the
      exercise of the rights then represented by this Warrant and the par value of
      said shares will at all times be less than or equal to the applicable Warrant
      Exercise Price.  If at any time the Company does not have a sufficient
      number of shares of Common Stock authorized and available, then the Company
      shall call and hold a special meeting of its stockholders within sixty (60)
      days of that time for the sole purpose of increasing the number of authorized
      shares of Common Stock.

     

    

    
      
        
          
          

        

        
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    (d)           If
      at any time after the date hereof the Company shall file a registration
      statement, the Company shall include the Warrant Shares issuable to the holder,
      pursuant to the terms of this Warrant and shall maintain, so long as any other
      shares of Common Stock shall be so listed, such listing of all Warrant Shares
      from time to time issuable upon the exercise of this Warrant; and the Company
      shall so list on each national securities exchange or automated quotation
      system, as the case may be, and shall maintain such listing of, any other shares
      of capital stock of the Company issuable upon the exercise of this Warrant
      if
      and so long as any shares of the same class shall be listed on such national
      securities exchange or automated quotation system.

     

    (e)           The
      Company will not, by amendment of its Articles of Incorporation or through
      any
      reorganization, transfer of assets, consolidation, merger, dissolution, issue
      or
      sale of securities, or any other voluntary action, avoid or seek to avoid the
      observance or performance of any of the terms to be observed or performed by
      it
      hereunder, but will at all times in good faith assist in the carrying out of
      all
      the provisions of this Warrant and in the taking of all such action as may
      reasonably be requested by the holder of this Warrant in order to protect the
      exercise privilege of the holder of this Warrant against dilution or other
      impairment, consistent with the tenor and purpose of this
      Warrant.  The Company will not increase the par value of any shares of
      Common Stock receivable upon the exercise of this Warrant above the Warrant
      Exercise Price then in effect, and (ii) will take all such actions as may
      be necessary or appropriate in order that the Company may validly and legally
      issue fully paid and nonassessable shares of Common Stock upon the exercise
      of
      this Warrant.

     

    (f)           This
      Warrant will be binding upon any entity succeeding to the Company by merger,
      consolidation or acquisition of all or substantially all of the Company’s
      assets.

     

    Section
      4.     Taxes.  The
      Company shall pay any and all taxes, except any applicable withholding, which
      may be payable with respect to the issuance and delivery of Warrant Shares
      upon
      exercise of this Warrant.

     

    Section
      5.     Warrant Holder Not
      Deemed a Stockholder.  Except as otherwise specifically provided
      herein, no holder, as such, of this Warrant shall be entitled to vote or receive
      dividends or be deemed the holder of shares of capital stock of the Company
      for
      any purpose, nor shall anything contained in this Warrant be construed to confer
      upon the holder hereof, as such, any of the rights of a stockholder of the
      Company or any right to vote, give or withhold consent to any corporate action
      (whether any reorganization, issue of stock, reclassification of stock,
      consolidation, merger, conveyance or otherwise), receive notice of meetings,
      receive dividends or subscription rights, or otherwise, prior to the issuance
      to
      the holder of this Warrant of the Warrant Shares which he or she is then
      entitled to receive upon the due exercise of this Warrant.  In
      addition, nothing contained in this Warrant shall be construed as imposing
      any
      liabilities on such holder to purchase any securities (upon exercise of this
      Warrant or otherwise) or as a stockholder of the Company, whether such
      liabilities are asserted by the Company or by creditors of the
      Company.  Notwithstanding this Section 5, the Company will provide the
      holder of this Warrant with copies of the same notices and other information
      given to the stockholders of the Company generally, contemporaneously with
      the
      giving thereof to the stockholders.

     

    

    
      
        
          
          

        

        
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    Section
      6.    Representations of
      Holder.  The holder of this Warrant, by the acceptance hereof,
      represents that it is acquiring this Warrant and the Warrant Shares for its
      own
      account for investment only and not with a view towards, or for resale in
      connection with, the public sale or distribution of this Warrant or the Warrant
      Shares, except pursuant to sales registered or exempted under the Securities
      Act; provided, however, that by making the representations herein, the holder
      does not agree to hold this Warrant or any of the Warrant Shares for any minimum
      or other specific term and reserves the right to dispose of this Warrant and
      the
      Warrant Shares at any time in accordance with or pursuant to a registration
      statement or an exemption under the Securities Act.  The holder of
      this Warrant further represents, by acceptance hereof, that, as of this date,
      such holder is an “accredited investor” as such term is defined in
      Rule 501(a)(1) of Regulation D promulgated by the Securities and Exchange
      Commission under the Securities Act (an “Accredited
      Investor”).  Upon exercise of this Warrant the holder shall, if
      requested by the Company, confirm in writing, in a form satisfactory to the
      Company, that the Warrant Shares so purchased are being acquired solely for
      the
      holder’s own account and not as a nominee for any other party, for investment,
      and not with a view toward distribution or resale and that such holder is an
      Accredited Investor.  If such holder cannot make such representations
      because they would be factually incorrect, it shall be a condition to such
      holder’s exercise of this Warrant that the Company receive such other
      representations as the Company considers reasonably necessary to assure the
      Company that the issuance of its securities upon exercise of this Warrant shall
      not violate any United States or state securities laws.

     

    Section
      7.    Ownership and
      Transfer.

     

    (a)           The
      Company shall maintain at its principal executive offices (or such other office
      or agency of the Company as it may designate by notice to the holder hereof),
      a
      register for this Warrant, in which the Company shall record the name and
      address of the person in whose name this Warrant has been issued, as well as
      the
      name and address of each transferee.  The Company may treat the person
      in whose name any Warrant is registered on the register as the owner and holder
      thereof for all purposes, notwithstanding any notice to the contrary, but in
      all
      events recognizing any transfers made in accordance with the terms of this
      Warrant.

     

    Section
      8.    Adjustment of
      Warrant Exercise Price and Number of Shares.  The Warrant Exercise
      Price and the number of shares of Common Stock issuable upon exercise of this
      Warrant shall be adjusted from time to time as follows:

     

    (a)           Adjustment
      of Warrant Exercise Price and Number of Shares upon Issuance of Common
      Stock.  If and whenever on or after the Issuance Date of this
      Warrant, the Company issues or sells, or is deemed to have issued or sold,
      any
      shares of Common Stock (other than (i) Excluded Securities and (ii) shares
      of Common Stock which are issued or deemed to have been issued by the Company
      in
      connection with an Approved Stock Plan or upon exercise or conversion of the
      Other Securities) for a consideration per share less than a price (the
“Applicable Price”) equal to the Warrant Exercise Price in effect
      immediately prior to such issuance or sale, then immediately after such issue
      or
      sale the Warrant Exercise Price then in effect shall be reduced to an amount
      equal to such consideration per share.  Upon each such adjustment of
      the Warrant Exercise Price hereunder, the number of Warrant Shares issuable
      upon
      exercise of this Warrant shall be adjusted to the number of shares determined
      by
      multiplying the Warrant Exercise Price in effect immediately prior to such
      adjustment by the number of Warrant Shares issuable upon exercise of this
      Warrant immediately prior to such adjustment and dividing the product thereof
      by
      the Warrant Exercise Price resulting from such adjustment.

     

    

    
      
        
          
          

        

        
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    (b)           Effect
      on Warrant Exercise Price of Certain Events.  For purposes of
      determining the adjusted Warrant Exercise Price under Section 8(a) above, the
      following shall be applicable:

     

    (i)           Issuance
      of Options.  If after the date hereof, the Company in any manner
      grants any Options and the lowest price per share for which one share of Common
      Stock is issuable upon the exercise of any such Option or upon conversion or
      exchange of any convertible securities issuable upon exercise of any such Option
      is less than the Applicable Price, then such share of Common Stock shall be
      deemed to be outstanding and to have been issued and sold by the Company at
      the
      time of the granting or sale of such Option for such price per
      share.  For purposes of this Section 8(b)(i), the lowest price per
      share for which one share of Common Stock is issuable upon exercise of such
      Options or upon conversion or exchange of such Convertible Securities shall
      be
      equal to the sum of the lowest amounts of consideration (if any) received or
      receivable by the Company with respect to any one share of Common Stock upon
      the
      granting or sale of the Option, upon exercise of the Option or upon conversion
      or exchange of any convertible security issuable upon exercise of such
      Option.  No further adjustment of the Warrant Exercise Price shall be
      made upon the actual issuance of such Common Stock or of such convertible
      securities upon the exercise of such Options or upon the actual issuance of
      such
      Common Stock upon conversion or exchange of such convertible
      securities.

     

    (ii)           Issuance
      of Convertible Securities.  If the Company in any manner issues or
      sells any convertible securities and the lowest price per share for which one
      share of Common Stock is issuable upon the conversion or exchange thereof is
      less than the Applicable Price, then such share of Common Stock shall be deemed
      to be outstanding and to have been issued and sold by the Company at the time
      of
      the issuance or sale of such convertible securities for such price per
      share.  For the purposes of this Section 8(b)(ii), the lowest
      price per share for which one share of Common Stock is issuable upon such
      conversion or exchange shall be equal to the sum of the lowest amounts of
      consideration (if any) received or receivable by the Company with respect to
      one
      share of Common Stock upon the issuance or sale of the convertible security
      and
      upon conversion or exchange of such convertible security.  No further
      adjustment of the Warrant Exercise Price shall be made upon the actual issuance
      of such Common Stock upon conversion or exchange of such convertible securities,
      and if any such issue or sale of such convertible securities is made upon
      exercise of any Options for which adjustment of the Warrant Exercise Price
      had
      been or are to be made pursuant to other provisions of this Section 8(b), no
      further adjustment of the Warrant Exercise Price shall be made by reason of
      such
      issue or sale.

     

    (iii)           Change
      in Option Price or Rate of Conversion.  If the purchase price
      provided for in any Options, the additional consideration, if any, payable
      upon
      the issue, conversion or exchange of any convertible securities, or the rate
      at
      which any convertible securities are convertible into or exchangeable for Common
      Stock changes at any time, the Warrant Exercise Price in effect at the time
      of
      such change shall be adjusted to the Warrant Exercise Price which would have
      been in effect at such time had such Options or convertible securities provided
      for such changed purchase price, additional consideration or changed conversion
      rate, as the case may be, at the time initially granted, issued or sold and
      the
      number of Warrant Shares issuable upon exercise of this Warrant shall be
      correspondingly readjusted.  For purposes of this Section 8(b)(iii),
      if the terms of any Option or convertible security that was outstanding as
      of
      the Issuance Date of this Warrant are changed in the manner described in the
      immediately preceding sentence, then such Option or convertible security and
      the
      Common Stock deemed issuable upon exercise, conversion or exchange thereof
      shall
      be deemed to have been issued as of the date of such change.  No
      adjustment pursuant to this Section 8(b) shall be made if such adjustment
      would result in an increase of the Warrant Exercise Price then in
      effect.

     

    

    
      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

    

    

     

     

    (c)           Effect
      on Warrant Exercise Price of Certain Events.  For purposes of
      determining the adjusted Warrant Exercise Price under Sections 8(a) and
      8(b), the following shall be applicable:

     

    (i)           Calculation
      of Consideration Received.  If any Common Stock, Options or
      convertible securities are issued or sold or deemed to have been issued or
      sold
      for cash, the consideration received therefore will be deemed to be the net
      amount received by the Company therefore.  If any Common Stock,
      Options or convertible securities are issued or sold for a consideration other
      than cash, the amount of such consideration received by the Company will be
      the
      fair value of such consideration, except where such consideration consists
      of
      marketable securities, in which case the amount of consideration received by
      the
      Company will be the market price of such securities on the date of receipt
      of
      such securities.  If any Common Stock, Options or convertible
      securities are issued to the owners of the non-surviving entity in connection
      with any merger in which the Company is the surviving entity, the amount of
      consideration therefore will be deemed to be the fair value of such portion
      of
      the net assets and business of the non-surviving entity as is attributable
      to
      such Common Stock, Options or convertible securities, as the case may
      be.  The fair value of any consideration other than cash or securities
      will be determined jointly by the Company and the holders of Warrants
      representing at least two-thirds (b) of the Warrant Shares issuable upon
      exercise of the Warrants then outstanding.  If such parties are unable
      to reach agreement within ten (10) days after the occurrence of an event
      requiring valuation (the “Valuation Event”), the fair value of such
      consideration will be determined within five (5) Business Days after the
      tenth (10th) day following
      the
      Valuation Event by an independent, reputable appraiser jointly selected by
      the
      Company and the holders of Warrants representing at least two-thirds (b) of
      the
      Warrant Shares issuable upon exercise of the Warrants then
      outstanding.  The determination of such appraiser shall be final and
      binding upon all parties and the fees and expenses of such appraiser shall
      be
      borne jointly by the Company and the holders of Warrants.

     

    (ii)           Integrated
      Transactions.  In case any Option is issued in connection with the
      issue or sale of other securities of the Company, together comprising one
      integrated transaction in which no specific consideration is allocated to such
      Options by the parties thereto, the Options will be deemed to have been issued
      for a consideration of $.01.

     

    (iii)           Treasury
      Shares.  The number of shares of Common Stock outstanding at any
      given time does not include shares owned or held by or for the account of the
      Company, and the disposition of any shares so owned or held will be considered
      an issue or sale of Common Stock.

     

    

    
      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

    

    

     

     

    (iv)           Record
      Date.  If the Company takes a record of the holders of Common
      Stock for the purpose of entitling them (1) to receive a dividend or other
      distribution payable in Common Stock, Options or in convertible securities
      or
      (2) to subscribe for or purchase Common Stock, Options or convertible
      securities, then such record date will be deemed to be the date of the issue
      or
      sale of the shares of Common Stock deemed to have been issued or sold upon
      the
      declaration of such dividend or the making of such other distribution or the
      date of the granting of such right of subscription or purchase, as the case
      may
      be.

     

    (d)           Adjustment
      of Warrant Exercise Price upon Subdivision or Combination of Common
      Stock.  If the Company at any time after the date of issuance of
      this Warrant subdivides (by any stock split, stock dividend, recapitalization
      or
      otherwise) one or more classes of its outstanding shares of Common Stock into
      a
      greater number of shares, any Warrant Exercise Price in effect immediately
      prior
      to such subdivision will be proportionately reduced and the number of shares
      of
      Common Stock obtainable upon exercise of this Warrant will be proportionately
      increased.  If the Company at any time after the date of issuance of
      this Warrant combines (by combination, reverse stock split or otherwise) one
      or
      more classes of its outstanding shares of Common Stock into a smaller number
      of
      shares, any Warrant Exercise Price in effect immediately prior to such
      combination will be proportionately increased and the number of Warrant Shares
      issuable upon exercise of this Warrant will be proportionately
      decreased.  Any adjustment under this Section 8(d) shall become
      effective at the close of business on the date the subdivision or combination
      becomes effective.

     

    (e)           Distribution
      of Assets.  If the Company shall declare or make any dividend or
      other distribution of its assets (or rights to acquire its assets) to holders
      of
      Common Stock, by way of return of capital or otherwise (including, without
      limitation, any distribution of cash, stock or other securities, property or
      options by way of a dividend, spin off, reclassification, corporate
      rearrangement or other similar transaction) (a “Distribution”), at any
      time after the issuance of this Warrant, then, in each such case:

     

    (i)           any
      Warrant Exercise Price in effect immediately prior to the close of business
      on
      the record date fixed for the determination of holders of Common Stock
      entitled to receive the Distribution shall be reduced, effective as
      of the close of business on such record date, to a price determined by
      multiplying such Warrant Exercise Price by a fraction of which (A) the numerator
      shall be the Closing Sale Price of the Common Stock on the trading day
      immediately preceding such record date minus the value of the Distribution
      (as
      determined in good faith by the Company’s Board of Directors) applicable to one
      share of Common Stock, and (B) the denominator shall be the Closing Sale Price
      of the Common Stock on the trading day immediately preceding such record date;
      and

     

    (ii)           either
      (A) the number of Warrant Shares obtainable upon exercise of this Warrant shall
      be increased to a number of shares equal to the number of shares of Common
      Stock
      obtainable immediately prior to the close of business on the record date fixed
      for the determination of holders of Common Stock entitled to receive the
      Distribution multiplied by the reciprocal of the fraction set forth in the
      immediately preceding clause (i), or (B) in the event that the Distribution
      is
      of common stock of a company whose common stock is traded on a national
      securities exchange or a national automated quotation system, then the holder
      of
      this Warrant shall receive an additional warrant to purchase Common Stock,
      the
      terms of which shall be identical to those of this Warrant, except that such
      warrant shall be exercisable into the amount of the assets that would have
      been
      payable to the holder of this Warrant pursuant to the Distribution had the
      holder exercised this Warrant immediately prior to such record date and with
      an
      exercise price equal to the amount by which the exercise price of this Warrant
      was decreased with respect to the Distribution pursuant to the terms of the
      immediately preceding clause (i).

     

    

    
      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

    

    

     

     

    (f)           Certain
      Events.  If any event occurs of the type contemplated by the
      provisions of this Section 8 but not expressly provided for by such
      provisions (including, without limitation, the granting of stock appreciation
      rights, phantom stock rights or other rights with equity features), then the
      Company’s Board of Directors will make an appropriate adjustment in the Warrant
      Exercise Price and the number of shares of Common Stock obtainable upon exercise
      of this Warrant so as to protect the rights of the holders of the Warrants;
      provided, except as set forth in section 8(d),that no such adjustment pursuant
      to this Section 8(f) will increase the Warrant Exercise Price or decrease the
      number of shares of Common Stock obtainable as otherwise determined pursuant
      to
      this Section 8.

     

    (g)           Notices.

     

    (i)           Immediately
      upon any adjustment of the Warrant Exercise Price, the Company will give written
      notice thereof to the holder of this Warrant, setting forth in reasonable
      detail, and certifying, the calculation of such adjustment.

     

    (ii)           The
      Company will give written notice to the holder of this Warrant at least ten
      (10)
      days prior to the date on which the Company closes its books or takes a record
      (A) with respect to any dividend or distribution upon the Common Stock,
      (B) with respect to any pro rata subscription offer to holders of Common
      Stock or (C) for determining rights to vote with respect to any Organic
      Change (as defined below), dissolution or liquidation, provided that such
      information shall be made known to the public prior to or in conjunction with
      such notice being provided to such holder.

     

    (iii)           The
      Company will also give written notice to the holder of this Warrant at least
      ten
      (10) days prior to the date on which any Organic Change, dissolution or
      liquidation will take place, provided that such information shall be made known
      to the public prior to or in conjunction with such notice being provided to
      such
      holder.

     

    Section
      9.     Purchase Rights;
      Reorganization, Reclassification, Consolidation, Merger or
      Sale.

     

    (a)           In
      addition to any adjustments pursuant to Section 8 above, if at any time the
      Company grants, issues or sells any Options, Convertible Securities or rights
      to
      purchase stock, warrants, securities or other property pro rata to the record
      holders of any class of Common Stock (the “Purchase Rights”), then the
      holder of this Warrant will be entitled to acquire, upon the terms applicable
      to
      such Purchase Rights, the aggregate Purchase Rights which such holder could
      have
      acquired if such holder had held the number of shares of Common Stock acquirable
      upon complete exercise of this Warrant immediately before the date on which
      a
      record is taken for the grant, issuance or sale of such Purchase Rights, or,
      if
      no such record is taken, the date as of which the record holders of Common
      Stock
      are to be determined for the grant, issue or sale of such Purchase
      Rights.

     

    

    
      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

    

    

     

     

    (b)           Any
      recapitalization, reorganization, reclassification, consolidation, merger,
      sale
      of all or substantially all of the Company’s assets to another Person or other
      transaction in each case which is effected in such a way that holders of Common
      Stock are entitled to receive (either directly or upon subsequent liquidation)
      stock, securities or assets with respect to or in exchange for Common Stock
      is
      referred to herein as an “Organic Change.”  Prior to the
      consummation of any (i) sale of all or substantially all of the Company’s assets
      to an acquiring Person or (ii) other Organic Change following which the Company
      is not a surviving entity, the Company will secure from the Person purchasing
      such assets or the successor resulting from such Organic Change (in each case,
      the “Acquiring Entity”) a written agreement (in form and substance
      satisfactory to the holders of Warrants representing at least two-thirds of
      the
      Warrant Shares issuable upon exercise of the Warrants then outstanding) to
      deliver to each holder of Warrants in exchange for such Warrants, a security
      of
      the Acquiring Entity evidenced by a written instrument substantially similar
      in
      form and substance to this Warrant and satisfactory to the holders of the
      Warrants (including an adjusted warrant exercise price equal to the value for
      the Common Stock reflected by the terms of such consolidation, merger or sale,
      and exercisable for a corresponding number of shares of Common Stock acquirable
      and receivable upon exercise of the Warrants without regard to any limitations
      on exercise, if the value so reflected is less than any Applicable Warrant
      Exercise Price immediately prior to such consolidation, merger or
      sale).  Prior to the consummation of any other Organic Change, the
      Company shall make appropriate provision (in form and substance satisfactory
      to
      the holders of Warrants representing a majority of the
      Warrant Shares issuable upon exercise of the Warrants then outstanding) to
      insure that each of the holders of the Warrants will thereafter have the right
      to acquire and receive in lieu of or in addition to (as the case may be) the
      Warrant Shares immediately theretofore issuable and receivable upon the exercise
      of such holder’s Warrants (without regard to any limitations on exercise),
      such shares of stock, securities or assets that would have been issued or
      payable in such Organic Change with respect to or in exchange for the number
      of
      Warrant Shares which would have been issuable and receivable upon the exercise
      of such holder’s Warrant as of the date of such Organic Change (without taking
      into account any limitations or restrictions on the exercisability of this
      Warrant).

     

    Section
      10.     Lost,
      Stolen, Mutilated or Destroyed Warrant.  If this Warrant is lost,
      stolen, mutilated or destroyed, the Company shall promptly, on receipt of an
      indemnification undertaking (or, in the case of a mutilated Warrant, the
      Warrant), issue a new Warrant of like denomination and tenor as this Warrant
      so
      lost, stolen, mutilated or destroyed.

     

    Section
      11.    Notice.  Any
      notices, consents, waivers or other communications required or permitted to
      be
      given under the terms of this Warrant must be in writing and will be deemed
      to
      have been delivered:  (i) upon receipt, when delivered
      personally; (ii) upon receipt, when sent by facsimile (provided
      confirmation of receipt is received by the sending party transmission is
      mechanically or electronically generated and kept on file by the sending party);
      or (iii) one Business Day after deposit with a nationally recognized
      overnight delivery service, in each case properly addressed to the party to
      receive the same.  The addresses and facsimile numbers for such
      communications shall be:

     

    

    
      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

    

    

     

     

    
      	
              If
                to Trafalgar:

            	
              Trafalgar
                Capital Specialized Investment Fund, Luxembourg

            
	 	
              8-10
                Rue Mathias Hardt

            
	 	
              BP
                3023

            
	 	
              L-1030
                Luxembourg

            
	 	
              Attention: Andrew
                Garai, Chairman of the Board of

            
	 	
                        
                Trafalgar Capital Sarl, General Partner

            
	 	
              Facsimile:       011-44-207-405-0161
                and

                                      001-786-323-1651

            
	 	 
	
              With
                Copy to:

            	
              James
                G. Dodrill II, P.A.

            
	 	
              5800
                Hamilton Way

            
	 	
              Boca
                Raton, FL  33496

            
	 	
              Attention:  James
                Dodrill, Esq.

            
	 	
              Telephone: (561)
                862-0529

            
	 	
              Facsimile:    (561)
                892-7787

            
	 	 
	
              If
                to the Company, to:

            	
              C-Mark
                International, Inc..

            
	 	
              4130
                E. Van Buren, Suite 325

            
	 	
              Phoenix,
                AZ 85008

            
	 	
              Attn:
                Mr. Charles Jones, CEO

            
	 	
              Telephone:
                (602) 443-8640

            
	 	
              Facsimile:
                (602) 443-8646

            
	 	 
	
              With
                a copy to:

            	
              The
                O’Neal Law Firm

            
	 	
              17100
                E. Shea Blvd., Suite 400-D

            
	 	
              Fountain
                Hills, AZ  85268

            
	 	
              Attention:  William
                O’Neal, Esq.

            
	 	
              Telephone:
                (480) 812-5058

            
	 	
              Facsimile:
                (480) 816-9241

            

    

    

    If
      to a
      holder of this Warrant, to it at the address and facsimile number set forth
      on
Exhibit C hereto, with copies to such holder’s representatives as
      set forth on Exhibit C, or at such other address and facsimile as
      shall be delivered to the Company upon the issuance or transfer of this
      Warrant.  Each party shall provide five days’ prior written notice to
      the other party of any change in address or facsimile number.  Written
      confirmation of receipt (A) given by the recipient of such notice, consent,
      facsimile, waiver or other communication, (or (B) provided by a nationally
      recognized overnight delivery service shall be rebuttable evidence of personal
      service, receipt by facsimile or receipt from a nationally recognized overnight
      delivery service in accordance with clause (i), (ii) or (iii) above,
      respectively.

     

    Section
      12.    Date.  The
      date of this Warrant is set forth on page 1 hereof.  This Warrant,
      in all events, shall be wholly void and of no effect after the close of
      business on the Expiration Date, except that notwithstanding any other
      provisions hereof, the provisions of Section 8(b) shall continue in full
      force and effect after such date as to any Warrant Shares or other securities
      issued upon the exercise of this Warrant.

     

    

    
      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

    

    

     

     

    Section
      13.    Amendment and
      Waiver.  Except as otherwise provided herein, the provisions of
      the Warrants may be amended and the Company may take any action herein
      prohibited, or omit to perform any act herein required to be performed by it,
      only if the Company has obtained the written consent of the holders of Warrants
      representing at least two-thirds of the Warrant Shares issuable upon exercise
      of
      the Warrants then outstanding; provided that, except for Section 8(d), no such
      action may increase the Warrant Exercise Price or decrease the number of shares
      or class of stock obtainable upon exercise of any Warrant without the written
      consent of the holder of such Warrant.

     

    Section
      14.    Descriptive
      Headings; Governing Law.  The descriptive headings of the several
      sections and paragraphs of this Warrant are inserted for convenience only and
      do
      not constitute a part of this Warrant.  The corporate laws of the
      State of Florida shall govern all issues concerning the relative rights of
      the
      Company and its stockholders.  All other questions concerning the
      construction, validity, enforcement and interpretation of this Agreement shall
      be governed by the internal laws of the State of Florida without giving effect
      to any choice of law or conflict of law provision or rule (whether of the State
      of Florida or any other jurisdictions) that would cause the application of
      the
      laws of any jurisdictions other than the State of Florida  Each party
      hereby irrevocably submits to the exclusive jurisdiction of the state courts
      sitting in Broward County, Florida and the United States District Court for
      the
      Southern District of Florida for the adjudication of any dispute hereunder
      or in
      connection herewith or therewith, or with any transaction contemplated hereby
      or
      discussed herein, and hereby irrevocably waives, and agrees not to assert in
      any
      suit, action or proceeding, any claim that it is not personally subject to
      the
      jurisdiction of any such court, that such suit, action or proceeding is brought
      in an inconvenient forum or that the venue of such suit, action or proceeding
      is
      improper.  Each party hereby irrevocably waives personal service of
      process and consents to process being served in any such suit, action or
      proceeding by mailing a copy thereof to such party at the address for such
      notices to it under this Agreement and agrees that such service shall constitute
      good and sufficient service of process and notice thereof.  Nothing
      contained herein shall be deemed to limit in any way any right to serve process
      in any manner permitted by law.

     

    Section
      15.     Waiver of
      Jury Trial.  AS A MATERIAL INDUCEMENT FOR EACH PARTY
      HERETO TO ENTER INTO THIS WARRANT, THE PARTIES HERETO HEREBY WAIVE ANY RIGHT
      TO
      TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATED IN ANY WAY TO THIS WARRANT AND/OR
      ANY AND ALL OF THE OTHER DOCUMENTS ASSOCIATED WITH THIS
      TRANSACTION.

     

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be signed as of
      the date first set forth above.

     

    
      	 	
              CMARK
                INTERNATIONAL, INC.

            
	 	 
	 	
              By:    /s/ 
                Charles W. Jones,
                Jr.                                                                                  

            
	 	
              Name:    Charles
                W. Jones, Jr. 
                                   

            
	 	
              Title:    President                                           

            

    

    

    
 

    

    
      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

    

    

    

     

    EXHIBIT
      A TO WARRANT

     

    EXERCISE
      NOTICE

     

    TO
      BE EXECUTED

     

    BY
      THE REGISTERED HOLDER TO EXERCISE THIS WARRANT

     

    C-MARK
      INTERNATIONAL, INC.

     

    The
      undersigned holder hereby exercises the right to purchase ______________ of
      the
      shares of Common Stock (“Warrant Shares”) of C-Mark International, Inc..,
      a South Carolina corporation (the “Company”), evidenced by the attached
      Warrant (the “Warrant”).  Capitalized terms used herein and not
      otherwise defined shall have the respective meanings set forth in the
      Warrant.

     

    1.           Form
      of Warrant Exercise Price.  The Holder intends that payment of the
      Warrant Exercise Price shall be made as a “Cash Exercise” with respect to
      ______________ Warrant Shares.

     

    2.           Payment
      of Warrant Exercise Price. The holder shall pay the sum of $______________
      to the Company in accordance with the terms of the Warrant.

     

    3.           Delivery
      of Warrant Shares.  The Company shall deliver to the holder
      _________ Warrant Shares in accordance with the terms of the
      Warrant.

     

    Date:
      _______________ __, ______

    

    

    Name
      of
      Registered Holder

    

    By:                                                                                                                   

    Name:                                                                                                                          

    Title:                                                                                                                              

    

    

    

    

    

    
      
        
           A-1           

          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    

     

    EXHIBIT
      B TO WARRANT

     

     

    FORM
      OF WARRANT POWER

     

    FOR
      VALUE RECEIVED, the undersigned does hereby assign and transfer to
      ________________, Federal Identification No. __________, a warrant to
      purchase ____________ shares of the capital stock of C-Mark International,
      Inc.,
      a South Carolina corporation, represented by warrant certificate no. _____,
      standing in the name of the undersigned on the books of said
      corporation.  The undersigned does hereby irrevocably constitute and
      appoint ______________, attorney to transfer the warrants of said corporation,
      with full power of substitution in the premises.

     

    
      	
              Dated:

            	 
	 	 
	 	
              By:    
                                                                                                                                              

            
	 	
              Name:                                                                 

            
	 	
              Title:                                                                   

            
	 	 

    

    

    

     

     

     

     

     

     

     B-1exhibit_10-25.htm

    
      

    

    Exhibit
      10.25

     

    

     

    SECURITIES
      PURCHASE AGREEMENT

     

    THIS
      SECURITIES PURCHASE AGREEMENT (this
“Agreement”), dated as of July 13, 2007, by and among
C-Mark
      International, Inc., a South Carolina corporation, with headquarters
      located at 4130 E. Van Buren, Suite 325, Phoenix, AZ 85008 (the
“Company”), and the Buyers listed on Schedule I attached
      hereto (individually, a “Buyer” or collectively
“Buyers”).

     

     

    WITNESSETH:

     

    WHEREAS,
      the Company and the Buyer(s) are executing and delivering this Agreement in
      reliance upon an exemption from securities registration pursuant to Section
      4(2)
      and/or Rule 506 of Regulation D (“Regulation D”) as promulgated by
      the U.S. Securities and Exchange Commission (the “SEC”) under the
      Securities Act of 1933, as amended (the “1933 Act”);

     

    WHEREAS,
      the parties desire that, upon the terms and subject to the conditions contained
      herein, the Company shall issue and sell to the Buyer(s), as provided herein,
      and the Buyer(s) of which Seven Hundred Thirty Seven Thousand Three Hundred
      Thirty Five Dollars and ninety five cents ($737,335.95) shall be funded on
      the
      date hereof pursuant to four separate Secured Debentures (the “First
      Closing”), and the remainder shall be funded on a date that is mutually
      acceptable to the Company and the Buyers, for a total purchase price of up
      to
      One Million Dollars ($1,000,000), (the “Purchase Price”) in the
      respective amounts set forth opposite each Buyer(s) name on Schedule I (the
      “Subscription Amount”); and

     

    WHEREAS,
      upon repayment by the Company of amounts funded by the Buyers, the Purchase
      Price shall be increased by the amount of such principal repaid hereunder,
      provided however that in no event shall the outstanding principal amount funded
      by the Buyers exceed One Million Dollars at any time

     

    WHEREAS,
      contemporaneously with the execution and delivery of this Agreement, the parties
      hereto are executing and delivering a Registration Rights Agreement
      substantially in the form attached hereto as Exhibit A (the “Investor
      Registration Rights Agreement”) pursuant to which the Company has agreed to
      provide certain registration rights under the 1933 Act and the rules and
      regulations promulgated there under, and applicable state securities laws;
      and

     

    WHEREAS,
      the aggregate proceeds of the sale of the Secured Debentures contemplated hereby
      shall be held in escrow pursuant to the terms of an escrow agreement
      substantially in the form of the Escrow Agreement attached hereto as Exhibit
      B; and

     

    WHEREAS,
      the parties hereto previously executed and delivered Irrevocable Transfer Agent
      Instructions substantially in the form attached hereto as Exhibit C (the
“Irrevocable Transfer Agent Instructions”); and

     

    WHEREAS,
      contemporaneously with the execution and delivery of this Agreement, the parties
      hereto are executing and delivering a Security Agreement substantially in the
      form attached hereto as Exhibit D (the “Security Agreement”)
      pursuant to which the Company has agreed to provide the Buyer a security
      interest in Pledged Collateral (as this term is defined in the Security
      Agreement dated the date hereof) to secure Company’s obligations under this
      Agreement, the Secured Debenture, the Investor Registration Rights Agreement,
      the Irrevocable Transfer Agent Instructions, the Security Agreement or any
      other
      obligations of the Company to the Buyer; and

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    NOW,
      THEREFORE, in consideration of the mutual covenants and other
      agreements contained in this Agreement the Company and the Buyer(s) hereby
      agree
      as follows:

     

    1.           PURCHASE
      AND SALE OF SECURED DEBENTURES.

     

    (a)    Purchase
      of Secured Debentures.  Subject to the satisfaction (or waiver) of
      the terms and conditions of this Agreement, each Buyer agrees, severally and
      not
      jointly, to purchase at Closing (as defined herein below) and the Company agrees
      to sell and issue to each Buyer, severally and not jointly, at Closing, Secured
      Debentures in amounts corresponding with the Subscription Amount set forth
      opposite each Buyer’s name on Schedule I hereto.  Upon execution
      hereof by a Buyer, the Buyer shall wire transfer the Subscription Amount set
      forth opposite his name on Schedule I in same-day funds or a check payable
      to:
”James G. Dodrill II, P.A. as Escrow Agent for C-Mark International,
      Inc./Trafalgar Capital Investment Fund”, which Subscription Amount shall be held
      in escrow pursuant to the terms of the Escrow Agreement (as hereinafter defined)
      and disbursed in accordance therewith.  Notwithstanding the foregoing,
      a Buyer may withdraw his Subscription Amount and terminate this Agreement as
      to
      such Buyer at any time after the execution hereof and prior to Closing (as
      hereinafter defined). 

     

    (b)    Closing
      Date.  The Closing of the purchase and sale of the Secured
      Debentures shall take place at 10:00 a.m. Eastern Standard Time on the date
      hereof, subject to notification of satisfaction of the conditions to the Closing
      set forth herein and in Sections 6 and 7 below (or such later date as is
      mutually agreed to by the Company and the Buyer(s)) (the “FirstClosing
      Date”) and subsequent closings shall take place on dates that are mutually
      agreed to by the Company and the Buyers (“Subsequent Closing Dates” and
      with the First Closing Date, the “Closing Dates”),
      The  Closings shall occur on their respective Closing Dates at the
      offices of James G. Dodrill II, P.A., 5800 Hamilton Way, Boca Raton,
      FL  33496 (or such other place as is mutually agreed to by the Company
      and the Buyer(s)).

     

    (c)    Escrow
      Arrangements; Form of Payment.  Upon execution hereof by Buyer(s)
      and pending the Closing, the aggregate proceeds of the sale of the Secured
      Debentures to Buyer(s) pursuant hereto shall be deposited in a non-interest
      bearing escrow account with James G. Dodrill II, P.A., as escrow agent (the
      “Escrow Agent”), pursuant to the terms of an escrow agreement between the
      Company, the Buyer(s) and the Escrow Agent in the form attached hereto as
Exhibit B (the “Escrow Agreement”).  Subject to the
      satisfaction of the terms and conditions of this Agreement, on the Closing
      Dates, (i) the Escrow Agent shall deliver to the Company in accordance with
      the
      terms of the Escrow Agreement such aggregate proceeds for the Secured Debentures
      to be issued and sold to such Buyer(s), minus the fees and expenses as set
      forth
      herein which shall be paid directly from the gross proceeds held in escrow
      at
      each Closing by wire transfer of immediately available funds and (ii) the
      Company shall deliver to each Buyer, Secured Debentures which such Buyer(s)
      is
      purchasing in amounts indicated opposite such Buyer’s name on Schedule I, duly
      executed on behalf of the Company.

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (d)    “Closing
      Date
      Exchange Rate” means the Euro to US dollar spot exchange rate as quoted in the
      London edition of the Financial Times on the Closing Date.

     

    (e)    “Repayment
      Exchange Rate” means in relation to each date of a
      Redemption Notice, the Euro to US dollar spot exchange
      rate as quoted by in the London edition of the Financial Times on such
      date.

     

    (f)    If
      on the
      date of any Redemption Notice, the Repayment Exchange Rate is less than the
      Closing Date Exchange Rate then the number of Shares to be issued shall be
      increased by the same percentage as results from dividing the Closing Date
      Exchange Rate by the relevant Repayment Exchange Rate.  By way of
      example, if the number of Shares to be issued in respect of a particular
      Redemption Notice would, but for this Clause 1(f), be 1,000 and if the Closing
      Date Exchange Rate is 1.80 and the relevant Repayment Exchange Rate is 1.75,
      then 1,029 Shares will be issued in relation to that Redemption Notice, as
      the
      case may be.

     

    (g)    If
      on the
      Repayment Date or any Interest Repayment Date, the Cash Payment Date Exchange
      Rate, as defined below is less than the Closing Date Exchange Rate then the
      amount of cash required to satisfy the amounts due at such time shall be
      increased by the same percentage as results from dividing the Closing Date
      Exchange Rate by the relevant Cash Payment Date Exchange Rate. “Cash Payment
      Date Exchange Rate” means in
      relation to each Repayment Date or Interest Repayment Date
      the Euro to US dollar spot exchange
      rate as quoted in the London edition of the Financial Times on such
      date.  By way of example, if the amount of cash required to repay all
      amounts due on such date would, but for this Clause 1(g), be $1,000 and if
      the
      Closing Date Exchange Rate is 1.80 and the relevant Repayment Date Exchange
      Rate
      is 1.75 then the amount of cash from the Cash Payment required to repay all
      amounts due on such date will be $1,028.57.

     

    (h)    Revolving
      Nature of Secured Debentures.  Subject to the terms of this
      Agreement, upon repayment by the Company of amounts funded by the Buyers, the
      Purchase Price shall be increased by the amount of such principal repaid
      hereunder, provided however that in no event shall the outstanding principal
      amount funded by the Buyers exceed One Million Dollars at any
      time.  All Secured Debentures sold hereunder shall be substantially in
      the form of the Secured Debentures executed on the date hereof and each shall
      be
      individually secured by the accounts receivable relating to the project such
      Secured Debenture funds.

     

    2.           BUYER’S
      REPRESENTATIONS AND WARRANTIES.

     

    Each
      Buyer represents and warrants, severally and not jointly, that:

     

    (a)    Investment
      Purpose.  Each Buyer is acquiring the Secured Debentures, for its
      own account for investment only and not with a view towards, or for resale
      in
      connection with, the public sale or distribution thereof, except pursuant to
      sales registered or exempted under the 1933 Act; provided, however, that by
      making the representations herein, such Buyer reserves the right to dispose
      of
      the shares issued upon default of the Secured Debenture at any time in
      accordance with or pursuant to an effective registration statement covering
      such
      shares or an available exemption under the 1933 Act.

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    (b)    Accredited
      Investor Status.  Each Buyer is an “Accredited Investor” as
      that term is defined in Rule 501(a)(3) of Regulation D.

     

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

     

    (d)    Information.  Each
      Buyer and its advisors (and his or, its counsel), if any, have been furnished
      with all materials relating to the business, finances and operations of the
      Company and information he deemed material to making an informed investment
      decision regarding his purchase of the Secured Debentures, which have been
      requested by such Buyer.  Each Buyer and its advisors, if any, have
      been afforded the opportunity to ask questions of the Company and its
      management.  Neither such inquiries nor any other due diligence
      investigations conducted by such Buyer or its advisors, if any, or its
      representatives shall modify, amend or affect such Buyer’s right to rely on the
      Company’s representations and warranties contained in Section 3
      below.  Each Buyer understands that its investment in the Secured
      Debentures involves a high degree of risk.  Each Buyer is in a
      position regarding the Company, which, based upon employment, family
      relationship or economic bargaining power, enabled and enables such Buyer to
      obtain information from the Company in order to evaluate the merits and risks
      of
      this investment.  Each Buyer has sought such accounting, legal and tax
      advice, as it has considered necessary to make an informed investment decision
      with respect to its acquisition of the Secured Debentures.

     

    (e)    No
      Governmental Review.  Each Buyer understands that no United States
      federal or state agency or any other government or governmental agency has
      passed on or made any recommendation or endorsement of the Secured Debentures,
      or the fairness or suitability of the investment in the Secured Debentures,
      nor
      have such authorities passed upon or endorsed the merits of the offering of
      the
      Secured Debentures.

     

    (f)    Transfer
      or Resale.  Each Buyer understands that except as provided in the
      Investor Registration Rights Agreement: (i) the Secured Debentures have not
      been
      and are not being registered under the 1933 Act or any state securities laws,
      and may not be offered for sale, sold, assigned or transferred unless (A)
      subsequently registered thereunder, or (B) such Buyer shall have delivered
      to
      the Company an opinion of counsel, in a generally acceptable form, to the effect
      that such securities to be sold, assigned or transferred may be sold, assigned
      or transferred pursuant to an exemption from such registration requirements;
      (ii) any sale of such securities made in reliance on Rule 144 under the 1933
      Act
      (or a successor rule thereto) (“Rule 144”) may be made only in
      accordance with the terms of Rule 144 and further, if Rule 144 is not
      applicable, any resale of such securities under circumstances in which the
      seller (or the person through whom the sale is made) may be deemed to be an
      underwriter (as that term is defined in the 1933 Act) may require compliance
      with some other exemption under the 1933 Act or the rules and regulations of
      the
      SEC thereunder; and (iii) neither the Company nor any other person is under
      any
      obligation to register such securities under the 1933 Act or any state
      securities laws or to comply with the terms and conditions of any exemption
      thereunder.

     

    

    
      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

    

    

     

     

    (g)    Legends.  Each
      Buyer understands that the certificates or other instruments representing the
      Secured Debentures shall bear a restrictive legend in substantially the
      following form (and a stop ­transfer order may be placed against transfer of
      such stock certificates):

     

    
      	
               THE
                SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
                UNDER
                THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
                LAWS.  THE SECURITIES HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT
                PURPOSES AND NOT WITH A VIEW TOWARD RESALE AND MAY NOT BE OFFERED
                FOR
                SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
                REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT
                OF
                1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION
                OF
                COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
                REQUIRED
                UNDER SAID ACT OR APPLICABLE STATE SECURITIES
                LAWS.

            

    

     

    The
      legend set forth above shall be removed and the Company within two (2) business
      days shall issue a certificate without such legend to the holder of the Secured
      Debenture upon which it is stamped, if, unless otherwise required by state
      securities laws, (i) in connection with a sale transaction, provided the Secured
      Debenture is registered under the 1933 Act or (ii) in connection with a sale
      transaction, after such holder provides the Company with an opinion of counsel,
      which opinion shall be in form, substance and scope customary for opinions
      of
      counsel in comparable transactions, to the effect that a public sale, assignment
      or transfer of the Secured Debenture may be made without registration under
      the
      1933 Act.

     

    (h)    Authorization,
      Enforcement.  This Agreement has been duly and validly authorized,
      executed and delivered on behalf of such Buyer and is a valid and binding
      agreement of such Buyer enforceable in accordance with its terms, except as
      such
      enforceability may be limited by general principles of equity or applicable
      bankruptcy, insolvency, reorganization, moratorium, liquidation and other
      similar laws relating to, or affecting generally, the enforcement of applicable
      creditors’ rights and remedies.

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    (i)    Receipt
      of
      Documents.  Each Buyer and his or its counsel has received and
      read in their entirety:  (i) this Agreement and each representation,
      warranty and covenant set forth herein, the Security Agreement, the Investor
      Registration Rights Agreement, the Escrow Agreement, and the Irrevocable
      transfer Agent Instructions; (ii) all due diligence and other information
      necessary to verify the accuracy and completeness of such representations,
      warranties and covenants; and (iii) answers to all questions each Buyer
      submitted to the Company regarding an investment in the Company; and each Buyer
      has relied on the information contained therein and has not been furnished
      any
      other documents, literature, memorandum or prospectus.

     

    (j)    Due
      Formation of Corporate and Other Buyers.  If the Buyer(s) is a
      corporation, trust, partnership or other entity that is not an individual
      person, it has been formed and validly exists and has not been organized for
      the
      specific purpose of purchasing the Secured Debentures and is not prohibited
      from
      doing so.

     

    (k)    No
      Legal
      Advice From the Company.  Each Buyer acknowledges, that it had the
      opportunity to review this Agreement and the transactions contemplated by this
      Agreement with his or its own legal counsel and investment and tax
      advisors.  Each Buyer is relying solely on such counsel and advisors
      and not on any statements or representations of the Company or any of its
      representatives or agents for legal, tax or investment advice with respect
      to
      this investment, the transactions contemplated by this Agreement or the
      securities laws of any jurisdiction.

     

    3.           REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY.

     

    The
      Company represents and warrants as of the date hereof and as of each Closing
      Date to each of the Buyers that:

     

    (a)    Organization
      and
      Qualification.  The Company and its subsidiaries are corporations
      duly organized and validly existing in good standing under the laws of the
      jurisdiction in which they are incorporated, and have the requisite corporate
      power to own their properties and to carry on their business as now being
      conducted.  Each of the Company and its subsidiaries is duly qualified
      as a foreign corporation to do business and is in good standing in every
      jurisdiction in which the nature of the business conducted by it makes such
      qualification necessary, except to the extent that the failure to be so
      qualified or be in good standing would not have a material adverse effect on
      the
      Company and its subsidiaries taken as a whole.

     

    (b)    Authorization,
      Enforcement, Compliance with Other Instruments.  (i) The
      Company has the requisite corporate power and authority to enter into and
      perform this Agreement, the Security Agreement, the Investor Registration Rights
      Agreement, the Escrow Agreement, the Irrevocable Transfer Agent Instructions,
      and any related agreements, and to issue the Secured Debentures in accordance
      with the terms hereof and thereof, (ii) the execution and delivery of this
      Agreement, the Security Agreement, the Investor Registration Rights Agreement,
      the Escrow Agreement, the Irrevocable Transfer Agent Instructions (as defined
      herein) and any related agreements by the Company and the consummation by it
      of
      the transactions contemplated hereby and thereby, including, without limitation,
      the issuance of the Secured Debentures, the Warrants and the reservation for
      issuance and the issuance of the shares issuable upon exercise thereof, have
      been duly authorized by the Company’s Board of Directors and no further consent
      or authorization is required by the Company, its Board of Directors or its
      stockholders, (iii) this Agreement, the Security Agreement, the Investor
      Registration Rights Agreement, the Escrow Agreement, the Irrevocable Transfer
      Agent Instructions and any related agreements have been duly executed and
      delivered by the Company, (iv) this Agreement, the Security Agreement, the
      Investor Registration Rights Agreement, the Escrow Agreement, the Irrevocable
      Transfer Agent Instructions and any related agreements constitute the valid
      and
      binding obligations of the Company enforceable against the Company in accordance
      with their terms, except as such enforceability may be limited by general
      principles of equity or applicable bankruptcy, insolvency, reorganization,
      moratorium, liquidation or similar laws relating to, or affecting generally,
      the
      enforcement of creditors’ rights and remedies.  The authorized officer
      of the Company executing this Agreement, the Security Agreement, the Investor
      Registration Rights Agreement, the Escrow Agreement, the Irrevocable Transfer
      Agent Instructions and any related agreements knows of no reason why the Company
      cannot file the registration statement as required under the Investor
      Registration Rights Agreement or perform any of the Company’s other obligations
      under such documents.

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    (c)    Capitalization.  The
      authorized capital stock of the Company consists of 500 million shares of Common
      Stock, par value $.0001 per share and no shares of Preferred
      Stock.  As of the date hereof, the Company has 89,632,500 shares of
      Common Stock and no shares of Preferred Stock issued and
      outstanding.  All of such outstanding shares have been validly issued
      and are fully paid and nonassessable.  No shares of Common Stock are
      subject to preemptive rights or any other similar rights or any liens or
      encumbrances suffered or permitted by the Company.  As of the date of
      this Agreement, (i) there are no outstanding options, warrants, scrip, rights
      to
      subscribe to, calls or commitments of any character whatsoever relating to,
      or
      securities or rights convertible into, any shares of capital stock of the
      Company or any of its subsidiaries, or contracts, commitments, understandings
      or
      arrangements by which the Company or any of its subsidiaries is or may become
      bound to issue additional shares of capital stock of the Company or any of
      its
      subsidiaries or options, warrants, scrip, rights to subscribe to, calls or
      commitments of any character whatsoever relating to, or securities or rights
      convertible into, any shares of capital stock of the Company or any of its
      subsidiaries, (ii) there are no outstanding debt securities and (iii) there
      are
      no agreements or arrangements under which the Company or any of its subsidiaries
      is obligated to register the sale of any of their securities under the 1933
      Act
      (except pursuant to the Registration Rights Agreement) and (iv) there are no
      outstanding registration statements and there are no outstanding comment letters
      from the SEC or any other regulatory agency.  There are no securities
      or instruments containing anti-dilution or similar provisions that will be
      triggered by the issuance of the Secured Debentures as described in this
      Agreement.  The Company has furnished to the Buyer true and correct
      copies of the Company’s Certificate of Incorporation, as amended and as in
      effect on the date hereof (the “Certificate of Incorporation”), and the
      Company’s By-laws, as in effect on the date hereof (the “By-laws”), and
      the terms of all securities convertible into or exercisable for Common Stock
      and
      the material rights of the holders thereof in respect thereto other than stock
      options issued to employees and consultants.

     

    (d)    Issuance
      of Securities.  The Secured Debentures and the Warrants are duly
      authorized and, upon issuance in accordance with the terms hereof, shall be
      duly
      issued, fully paid and nonassessable, are free from all taxes, liens and charges
      with respect to the issue thereof.  The shares issuable upon exercise
      of the Warrants have been duly authorized and reserved for issuance and upon
      exercise in accordance with the Warrants, will be duly issued, fully paid and
      nonassessable.

     

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    (e)    No
      Conflicts.  The execution, delivery and performance of this
      Agreement, the Security Agreement, the Investors Registration Rights Agreement,
      the Escrow Agreement and the Irrevocable Transfer Agent Instructions by the
      Company and the consummation by the Company of the transactions contemplated
      hereby will not (i) result in a violation of the Certificate of Incorporation,
      any certificate of designations of any outstanding series of preferred stock
      of
      the Company or the By-laws or (ii) conflict with or constitute a default (or
      an
      event which with notice or lapse of time or both would become a default) under,
      or give to others any rights of termination, amendment, acceleration or
      cancellation of, any agreement, indenture or instrument to which the Company
      or
      any of its subsidiaries is a party, or result in a violation of any law, rule,
      regulation, order, judgment or decree (including federal and state securities
      laws and regulations and, once the Company’s common stock is quoted on the OTC
      Bulletin Board, the rules and regulations of The National Association of
      Securities Dealers Inc.’s OTC Bulletin Board) applicable to the Company or any
      of its subsidiaries or by which any property or asset of the Company or any
      of
      its subsidiaries is bound or affected.  Neither the Company nor its
      subsidiaries is in violation of any term of or in default under its Certificate
      of Incorporation or By-laws or their organizational charter or by-laws,
      respectively, or any material contract, agreement, mortgage, indebtedness,
      indenture, instrument, judgment, decree or order or any statute, rule or
      regulation applicable to the Company or its subsidiaries.  The
      business of the Company and its subsidiaries is not being conducted, and shall
      not be conducted in violation of any material law, ordinance, or regulation
      of
      any governmental entity.  Except as specifically contemplated by this
      Agreement and as required under the 1933 Act and any applicable state securities
      laws, the Company is not required to obtain any consent, authorization or order
      of, or make any filing or registration with, any court or governmental agency
      in
      order for it to execute, deliver or perform any of its obligations under or
      contemplated by this Agreement or the Registration Rights Agreement in
      accordance with the terms hereof or thereof.  All consents,
      authorizations, orders, filings and registrations which the Company is required
      to obtain pursuant to the preceding sentence have been obtained or effected
      on
      or prior to the date hereof.  The Company and its subsidiaries are
      unaware of any facts or circumstance, which might give rise to any of the
      foregoing.

     

    (f)    [reserved]

     

    (g)    None
      of the
      Company’s public statements and none of the information provided to the Buyers
      include any untrue statements of material fact, nor do they omit to state any
      material fact required to be stated therein necessary to make the statements
      made, in light of the circumstances under which they were made, not
      misleading.

     

    (h)    Absence
      of
      Litigation.  There is no action, suit, proceeding, inquiry or
      investigation before or by any court, public board, government agency,
      self-regulatory organization or body pending against or affecting the Company,
      the Common Stock or any of the Company’s subsidiaries, wherein an unfavorable
      decision, ruling or finding would (i) have a material adverse effect on the
      transactions contemplated hereby (ii) adversely affect the validity or
      enforceability of, or the authority or ability of the Company to perform its
      obligations under, this Agreement or any of the documents contemplated herein,
      or (iii) except as expressly disclosed in the SEC Documents, have a material
      adverse effect on the business, operations, properties, financial condition
      or
      results of  operations of the Company and its subsidiaries taken as a
      whole.

     

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    (i)    Acknowledgment
      Regarding Buyer’s Purchase of the Secured Debentures.  The Company
      acknowledges and agrees that the Buyer(s) is acting solely in the capacity
      of an
      arm’s length purchaser with respect to this Agreement and the transactions
      contemplated hereby.  The Company further acknowledges that the
      Buyer(s) is not acting as a financial advisor or fiduciary of the Company (or
      in
      any similar capacity) with respect to this Agreement and the transactions
      contemplated hereby and any advice given by the Buyer(s) or any of their
      respective representatives or agents in connection with this Agreement and
      the
      transactions contemplated hereby is merely incidental to such Buyer’s purchase
      of the Secured Debentures.  The Company further represents to the
      Buyer that the Company’s decision to enter into this Agreement has been based
      solely on the independent evaluation by the Company and its
      representatives.

     

    (j)    No
      General
      Solicitation.  Neither the Company, nor any of its affiliates, nor
      any person acting on its or their behalf, has engaged in any form of general
      solicitation or general advertising (within the meaning of Regulation D under
      the 1933 Act) in connection with the offer or sale of the Secured
      Debentures.

     

    (k)    No
      Integrated Offering.  Neither the Company, nor any of its
      affiliates, nor any person acting on its or their behalf has, directly or
      indirectly, made any offers or sales of any security or solicited any offers
      to
      buy any security, under circumstances that would require registration of the
      Secured Debentures under the 1933 Act or cause this offering of the Secured
      Debentures to be integrated with prior offerings by the Company for purposes
      of
      the 1933 Act.

     

    (l)    Employee
      Relations.  Neither the Company nor any of its subsidiaries is
      involved in any labor dispute nor, to the knowledge of the Company or any of
      its
      subsidiaries, is any such dispute threatened.  None of the Company’s
      or its subsidiaries’ employees is a member of a union and the Company and its
      subsidiaries believe that their relations with their employees are
      good.

     

    (m)    Intellectual
      Property Rights.  The Company and its subsidiaries own or possess
      adequate rights or licenses to use all trademarks, trade names, service marks,
      service mark registrations, service names, patents, patent rights, copyrights,
      inventions, licenses, approvals, governmental authorizations, trade secrets
      and
      rights necessary to conduct their respective businesses as now
      conducted.  The Company and its subsidiaries do not have any knowledge
      of any infringement by the Company or its subsidiaries of trademark, trade
      name
      rights, patents, patent rights, copyrights, inventions, licenses, service names,
      service marks, service mark registrations, trade secret or other similar rights
      of others, and, to the knowledge of the Company there is no claim, action or
      proceeding being made or brought against, or to the Company’s knowledge, being
      threatened against, the Company or its subsidiaries regarding trademark, trade
      name, patents, patent rights, invention, copyright, license, service names,
      service marks, service mark registrations, trade secret or other infringement;
      and the Company and its subsidiaries are unaware of any facts or circumstances
      which might give rise to any of the foregoing.

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (n)    Environmental
      Laws.  The Company and its subsidiaries are (i) in compliance with
      any and all applicable foreign, federal, state and local laws and regulations
      relating to the protection of human health and safety, the environment or
      hazardous or toxic substances or wastes, pollutants or contaminants
      (“Environmental Laws”), (ii) have received all permits, licenses or other
      approvals required of them under applicable Environmental Laws to conduct their
      respective businesses and (iii) are in compliance with all terms and conditions
      of any such permit, license or approval.

     

    (o)    Title.  Any
      real property and facilities held under lease by the Company and its
      subsidiaries are held by them under valid, subsisting and enforceable leases
      with such exceptions as are not material and do not interfere with the use
      made
      and proposed to be made of such property and buildings by the Company and its
      subsidiaries.

     

    (p)    Insurance.  The
      Company and each of its subsidiaries are insured by insurers of recognized
      financial responsibility against such losses and risks and in such amounts
      as
      management of the Company believes to be prudent and customary in the businesses
      in which the Company and its subsidiaries are engaged.  Neither the
      Company nor any such subsidiary has been refused any insurance coverage sought
      or applied for and neither the Company nor any such subsidiary has any reason
      to
      believe that it will not be able to renew its existing insurance coverage as
      and
      when such coverage expires or to obtain similar coverage from similar insurers
      as may be necessary to continue its business at a cost that would not materially
      and adversely affect the condition, financial or otherwise, or the earnings,
      business or operations of the Company and its subsidiaries, taken as a
      whole.

     

    (q)    Regulatory
      Permits.  The Company and its subsidiaries possess all material
      certificates, authorizations and permits issued by the appropriate federal,
      state or foreign regulatory authorities necessary to conduct their respective
      businesses, and neither the Company nor any such subsidiary has received any
      notice of proceedings relating to the revocation or modification of any such
      certificate, authorization or permit.

     

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

     

    (s)   No
      Material
      Adverse Breaches, etc.  Neither the Company nor any of its
      subsidiaries is subject to any charter, corporate or other legal restriction,
      or
      any judgment, decree, order, rule or regulation which in the judgment of the
      Company’s officers has or is expected in the future to have a material adverse
      effect on the business, properties, operations, financial condition, results
      of
      operations or prospects of the Company or its subsidiaries.  Neither
      the Company nor any of its subsidiaries is in breach of any contract or
      agreement which breach, in the judgment of the Company’s officers, has or is
      expected to have a material adverse effect on the business, properties,
      operations, financial condition, results of operations or prospects of the
      Company or its subsidiaries.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (t)    Tax
      Status.  The Company and each of its subsidiaries has made and
      filed all federal and state income and all other tax returns, reports and
      declarations required by any jurisdiction to which it is subject and (unless
      and
      only to the extent that the Company and each of its subsidiaries has set aside
      on its books provisions reasonably adequate for the payment of all unpaid and
      unreported taxes) has paid all taxes and other governmental assessments and
      charges that are material in amount, shown or determined to be due on such
      returns, reports and declarations, except those being contested in good faith
      and has set aside on its books provision reasonably adequate for the payment
      of
      all taxes for periods subsequent to the periods to which such returns, reports
      or declarations apply.  There are no unpaid taxes in any material
      amount claimed to be due by the taxing authority of any jurisdiction, and the
      officers of the Company know of no basis for any such claim.

     

    (u)    Certain
      Transactions.  Except for arm’s length transactions pursuant to
      which the Company makes payments in the ordinary course of business upon terms
      no less favorable than the Company could obtain from third parties and other
      than the grant of stock options disclosed in the SEC Documents, none of the
      officers, directors, or employees of the Company is presently a party to any
      transaction with the Company (other than for services as employees, officers
      and
      directors), including any contract, agreement or other arrangement providing
      for
      the furnishing of services to or by, providing for rental of real or personal
      property to or from, or otherwise requiring payments to or from any officer,
      director or such employee or, to the knowledge of the Company, any corporation,
      partnership, trust or other entity in which any officer, director, or any such
      employee has a substantial interest or is an officer, director, trustee or
      partner.

     

    (v)    Fees
      and
      Rights of First Refusal.  The Company is not obligated to offer
      the securities offered hereunder on a right of first refusal basis or otherwise
      to any third parties including, but not limited to, current or former
      shareholders of the Company, underwriters, brokers, agents or other third
      parties.

     

    4.           COVENANTS.

     

    (a)    Best
      Efforts.  Each party shall use its best efforts timely to satisfy
      each of the conditions to be satisfied by it as provided in Sections 6 and
      7 of
      this Agreement.

     

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

     

    (c)    Reporting
      Status.  Until the earlier of (i) the date as of which the
      Buyer(s) may sell all of the shares underlying the Warrants without restriction
      pursuant to Rule 144(k) promulgated under the 1933 Act (or successor thereto),
      or (ii) the date on which (A) the Buyer(s) shall have sold all the shares
      underlying the Warrants and (B) none of the Secured Debentures or shares
      underlying the Warrants are outstanding (the “Registration Period”), the
      Company shall file in a timely manner all reports required to be filed with
      the
      SEC pursuant to the 1934 Act and the regulations of the SEC thereunder, and
      the
      Company shall not terminate its status as an issuer required to file reports
      under the 1934 Act even if the 1934 Act or the rules and regulations thereunder
      would otherwise permit such termination.

     

     

    
      
        
        

      

      
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    (d)    Use
      of
      Proceeds.  The Company will use the proceeds from the sale of the
      Secured Debentures for the Company to complete specific Jobs identified to
      and
      agreed to by the Holder.

     

    (e)    Reservation
      of
      Shares.  The Company shall take all action reasonably necessary to
      at all times have authorized, and reserved for the purpose of issuance, such
      number of shares of Common Stock as shall be necessary to effect the issuance
      of
      the shares underlying the Warrants.  If at any time the Company does
      not have available such shares of Common Stock as shall from time to time be
      sufficient to effect the issuance of all of the shares underlying the Warrants
      of the Company, the Company shall call and hold a special meeting of the
      shareholders within thirty (30) days of such occurrence, for the sole purpose
      of
      increasing the number of shares authorized.  The Company’s management
      shall recommend to the shareholders to vote in favor of increasing the number
      of
      shares of Common Stock authorized.  Management shall also vote all of
      its shares in favor of increasing the number of authorized shares of Common
      Stock.

     

    (f)    Listings
      or Quotation.  The Company shall promptly secure the listing or
      quotation of the shares underlying the Warrants upon each national securities
      exchange, automated quotation system or The National Association of Securities
      Dealers Inc.’s Over-The-Counter Bulletin Board (“OTCBB”) or other market,
      if any, upon which shares of Common Stock are then listed or quoted (subject
      to
      official notice of issuance) and shall use its best efforts to maintain, so
      long
      as any other shares of Common Stock shall be so listed, such listing of all
      shares underlying the Warrants from time to time issuable under the terms of
      this Agreement.  The Company shall maintain the Common Stock’s
      authorization for quotation on the OTCBB.

     

    (g)    Fees
      and
      Expenses.

     

    (i)    Each
      of the
      Company and the Buyer(s) shall pay all costs and expenses incurred by such
      party
      in connection with the negotiation, investigation, preparation, execution and
      delivery of this Agreement, the Escrow Agreement, the Investor Registration
      Rights Agreement, the Security Agreement and the Irrevocable Transfer Agent
      Instructions.  The Company shall pay the Buyer a loan commitment fee
      of three percent (%) of the Purchase Price, which shall be paid directly from
      the proceeds of and proportionally upon each Closing.

     

    (ii)    The
      Company
      has agreed to pay legal fees to Buyer of Fifteen Thousand Dollars ($15,000),
      to
      cover legal fees and processes and administrative costs for the First Closing,
      which shall be paid directly from the proceeds of the First
      Closing.

     

    (iii)    The
      Company
      has agreed to pay legal fees of Three Thousand Seven Hundred Fifty Dollars
      ($3,750) for each additional Secured Debenture (and corresponding Transaction
      Agreements) issued subsequent to the First Closing

     

     

    
      
        
        

      

      
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    (iv)    The
      Company
      shall issue to the Buyer a warrant to purchase one million five hundred thousand
      (1,500,000) shares of the Company’s Common Stock for a period of five
      (5) years at an exercise price equal to $.0001 (“Warrant 1”). The
      Company shall also issue to the Buyer for each one hundred thousand dollars
      ($100,000) of Secured Debentures purchased by the Buyer(s), an additional
      warrant to purchase fifty thousand (50,000) shares of the Company’s Common Stock
      for a period of five (5) years from such date at an exercise price equal to
      $0.075 per share (“Warrant 2”). (collectively Warrant 1 and Warrant 2
      shall be referred to as the “Warrants”) The Warrants shall be exercised
      on a cash basis provided that the Company is not in Default and the shares
      underlying the Warrants are subject to an effective registration
      statement.

     

    (h)    Corporate
      Existence.  So long as any of the Secured Debentures remain
      outstanding, the Company shall not directly or indirectly consummate any merger,
      reorganization, restructuring, reverse stock split consolidation, sale of all
      or
      substantially all of the Company’s assets or any similar transaction or related
      transactions (each such transaction, an “Organizational Change”) unless,
      prior to the consummation an Organizational Change, the Company obtains the
      written consent of each Buyer.  In any such case, the Company will
      make appropriate provision with respect to such holders’ rights and interests to
      insure that the provisions of this Section 4(h) will thereafter be applicable
      to
      the Secured Debentures.

     

    (i)    Transactions
      With
      Affiliates.  So long as any Secured Debentures are outstanding,
      the Company shall not, and shall cause each of its subsidiaries not to, enter
      into, amend, modify or supplement, or permit any subsidiary to enter into,
      amend, modify or supplement any agreement, transaction, commitment, or
      arrangement with any of its or any subsidiary’s officers, directors, person who
      were officers or directors at any time during the previous two (2) years,
      stockholders who beneficially own five percent (5%) or more of the Common Stock,
      or Affiliates (as defined below) or with any individual related by blood,
      marriage, or adoption to any such individual or with any entity in which any
      such entity or individual owns a five percent (5%) or more beneficial interest
      (each a “Related Party”), except for (a) customary employment
      arrangements and benefit programs on reasonable terms, (b) any investment in
      an
      Affiliate of the Company,  (c) any agreement, transaction, commitment,
      or arrangement on an arms-length basis on terms no less favorable than terms
      which would have been obtainable from a person other than such Related Party,
      (d) any agreement transaction, commitment, or arrangement which is approved
      by a
      majority of the disinterested directors of the Company, for purposes hereof,
      any
      director who is also an officer of the Company or any subsidiary of the Company
      shall not be a disinterested director with respect to any such agreement,
      transaction, commitment, or arrangement.  “Affiliate” for
      purposes hereof means, with respect to any person or entity, another person
      or
      entity that, directly or indirectly, (i) has a ten percent (10%) or more equity
      interest in that person or entity, (ii) has ten percent (10%) or more common
      ownership with that person or entity, (iii) controls that person or entity,
      or
      (iv) shares common control with that person or
      entity.  “Control” or “controls” for purposes hereof
      means that a person or entity has the power, direct or indirect, to conduct
      or
      govern the policies of another person or entity.

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    (j)           Transfer
      Agent.  The Company covenants and agrees that, in the event that
      the Company’s agency relationship with the transfer agent should be terminated
      for any reason prior to a date which is two (2) years after the Closing Date,
      the Company shall immediately appoint a new transfer agent and shall require
      that the new transfer agent execute and agree to be bound by the terms of the
      Irrevocable Transfer Agent Instructions (as defined herein).

     

    (k)    Restriction
      on
      Issuance of the Capital Stock. So long as any Secured Debentures are
      outstanding, the Company shall not, without the prior written consent of the
      Buyer(s), (i) issue or sell shares of Common Stock or Preferred Stock without
      consideration or for a consideration per share less than the bid price of the
      Common Stock determined immediately prior to its issuance, (ii) issue any
      preferred stock, warrant, option, right, contract, call, or other security
      instrument granting the holder thereof, the right to acquire Common Stock
      without consideration or for a consideration less than such Common Stock’s bid
      price value determined immediately prior to it’s issuance, (iii) enter into any
      security instrument granting the holder a security interest in any and all
      assets of the Company, or (iv) file any registration statement on Form
      S-8.

     

    (l)    Restriction
      on
“Short” Position.  Neither the Buyer nor any of its affiliates
      have an open short position in the Common Stock of the Company, and the Buyer
      agrees that it shall not, and that it will cause its affiliates not to, engage
      in any short sales with respect to the Common Stock as long as any Secured
      Debentures shall remain outstanding.

     

    (m)    Due
      Diligence and Monitoring.  The Company shall provide the Buyer
      with all materials relating to the contracts awarded as well as supply lists
      for
      materials and labor in connection with the projects to date of purchase of
      each.

     

    5.           TRANSFER
      AGENT INSTRUCTIONS.

     

    The
      Company shall issue the Irrevocable Transfer Agent Instructions to its transfer
      agent irrevocably appointing James G. Dodrill II, P.A. as its agent for purpose
      of having certificates issued, registered in the name of the Buyer(s) or its
      respective nominee(s), for the shares to be issued upon exercise of the Warrants
      as specified from time to time by the Buyer(s) to the Company.  James
      G. Dodrill II, P.A. shall be paid a cash fee of Fifty Dollars ($50) for every
      occasion they act pursuant to the Irrevocable Transfer Agent
      Instructions.  The Company shall not change its transfer agent without
      the express written consent of the Buyer(s), which may be withheld by the
      Buyer(s) in its sole discretion.  Prior to registration of the shares
      to be issued upon exercise of the Warrants under the 1933 Act, all such
      certificates shall bear the restrictive legend specified in Section 2(g) of
      this
      Agreement.  The Company warrants that no instruction other than the
      Irrevocable Transfer Agent Instructions referred to in this Section 5, and
      stop
      transfer instructions to give effect to Section 2(g) hereof (in the case of
      the
      shares to be issued upon exercise of the Warrants prior to registration of
      such
      shares under the 1933 Act) will be given by the Company to its transfer agent
      and that the shares to be issued upon exercise of the Warrants shall otherwise
      be freely transferable on the books and records of the Company as and to the
      extent provided in this Agreement and the Investor Registration Rights
      Agreement.  Nothing in this Section 5 shall affect in any way the
      Buyer’s obligations and agreement to comply with all applicable securities laws
      upon resale of shares to be issued upon exercise of the Warrants.  If
      the Buyer(s) provides the Company with an opinion of counsel, in form, scope
      and
      substance customary for opinions of counsel in comparable transactions to the
      effect that registration of a resale by the Buyer(s) of any of the shares to
      be
      issued upon exercise of the Warrants is not required under the 1933 Act, the
      Company shall within two (2) business days instruct its transfer agent to issue
      one or more certificates in such name and in such denominations as specified
      by
      the Buyer.  The Company acknowledges that a breach by it of its
      obligations hereunder will cause irreparable harm to the Buyer by vitiating
      the
      intent and purpose of the transaction contemplated
      hereby.  Accordingly, the Company acknowledges that the remedy at law
      for a breach of its obligations under this Section 5 will be inadequate and
      agrees, in the event of a breach or threatened breach by the Company of the
      provisions of this Section 5, that the Buyer(s) shall be entitled, in
      addition to all other available remedies, to an injunction restraining any
      breach and requiring immediate issuance and transfer, without the necessity
      of
      showing economic loss and without any bond or other security being
      required.

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    6.           CONDITIONS
      TO THE COMPANY’S OBLIGATION TO SELL.

     

    The
      obligation of the Company hereunder to issue and sell the Secured Debentures
      to
      the Buyer(s) at the Closing is subject to the satisfaction, at or before the
      Closing Dates, of each of the following conditions, provided that these
      conditions are for the Company’s sole benefit and may be waived by the Company
      at any time in its sole discretion:

     

    (a)    Each
      Buyer
      shall have executed this Agreement, the Security Agreement, the Escrow Agreement
      and the Investor Registration Rights Agreement and the Irrevocable Transfer
      Agent Instructions and delivered the same to the Company.

     

    (b)    The
      Buyer(s)
      shall have delivered to the Escrow Agent the Purchase Price for Secured
      Debentures in respective amounts as set forth next to each Buyer as outlined
      on
      Schedule I attached hereto and the Escrow Agent shall have delivered the net
      proceeds to the Company by wire transfer of immediately available U.S. funds
      pursuant to the wire instructions provided by the Company.

     

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

     

    (d)    The
      Company
      shall have filed a form UCC-1 with regard to the Pledged Property and Pledged
      Collateral as detailed in the Security Agreement dated the date hereof and
      provided proof of such filing to the Buyer(s).

     

    7.           CONDITIONS
      TO THE BUYER’S OBLIGATION TO PURCHASE.

     

    The
      obligation of the Buyer(s) hereunder to purchase the Secured Debentures at
      the
      Closing is subject to the satisfaction, at or before the Closing Date, of each
      of the following conditions:

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    (a)    The
      Company
      shall have executed this Agreement, the Security Agreement, the Secured
      Debenture, the Escrow Agreement, the Irrevocable Transfer Instructions and
      the
      Investor Registration Rights Agreement, and delivered the same to the
      Buyer(s).

     

    (b)    The
      Common
      Stock shall be authorized for quotation on the OTCBB within one hundred fifty
      (150) days from the date of the Closing.

     

    (c)    The
      representations and warranties of the Company shall be true and correct in
      all
      material respects (except to the extent that any of such representations and
      warranties is already qualified as to materiality in Section 3 above, in which
      case, such representations and warranties shall be true and correct without
      further qualification) as of the date when made and as of the Closing Dates
      as
      though made at that time (except for representations and warranties that speak
      as of a specific date) and the Company shall have performed, satisfied and
      complied in all material respects with the covenants, agreements and conditions
      required by this Agreement to be performed, satisfied or complied with by the
      Company at or prior to the Closing Dates.  If requested by the Buyer,
      the Buyer shall have received a certificate, executed by the President of the
      Company, dated as of the Closing Dates, to the foregoing effect and as to such
      other matters as may be reasonably requested by the Buyer including, without
      limitation an update as of the Closing Dates regarding the representation
      contained in Section 3(c) above.

     

    (d)    The
      Company
      shall have executed and delivered to the Buyer(s) the Secured Debentures in
      the
      respective amounts set forth opposite each Buyer(s) name on Schedule I attached
      hereto.

     

    (e)    The
      Buyer(s)
      shall have received an opinion of counsel from counsel to the Company in a
      form
      satisfactory to the Buyer(s).

     

    (f)    The
      Company
      shall have provided to the Buyer(s) a certificate of good standing from the
      secretary of state from the state in which the company is
      incorporated.

     

    (g)    As
      of the
      Closing Date, the Company shall have reserved out of its authorized and unissued
      Common Stock, solely for the purpose of effecting the exercise of the Warrants,
      shares of Common Stock to effect the exercise of all of the Warrants then
      outstanding.

     

    (h)    The
      Irrevocable Transfer Agent Instructions, in form and substance satisfactory
      to
      the Buyer, shall have been delivered to and acknowledged in writing by the
      Company’s transfer agent.

     

    (i)    The
      Company
      shall have provided to the Buyer an acknowledgement, to the satisfaction of
      the
      Buyer, from the Company’s independent certified public accountants as to its
      ability to provide all consents required in order to file a registration
      statement in connection with this transaction.

     

    (j)    The
      Company
      shall have filed a form UCC-1 or such other forms as may be required to perfect
      the Buyer’s interest in the Pledged Property and Pledged Collateral as detailed
      in the Security Agreement dated the date hereof and provided proof of such
      filing to the Buyer(s).

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    (k)    The
      Company
      shall provide the Buyer a near term projection of the Company’s cash flow that
      brings its burn rate to zero and demonstrates the Company’s ability to fund its
      deficit until such time as this occurs.

     

    8.      
          INDEMNIFICATION.

     

    
      (a)   In
        consideration of the Buyer’s execution and delivery of this Agreement and
        acquiring the Secured Debentures and the Warrants hereunder, and in addition
        to
        all of the Company’s other obligations under this
        Agreement, the Company shall defend, protect, indemnify and hold harmless
        the
        Buyer(s) and each other holder of the Secured Debentures and Warrants, and
        all
        of their officers, directors, employees and agents (including, without
        limitation, those retained in connection with the transactions contemplated
        by
        this Agreement) (collectively, the “Buyer Indemnitees”) from and against
        any and all actions, causes of action, suits, claims, losses, costs, penalties,
        fees, liabilities and damages, and expenses in connection therewith
        (irrespective of whether any such Buyer Indemnitee is a party to the action
        for
        which indemnification hereunder is sought), and including reasonable attorneys’
fees and disbursements (the “Indemnified Liabilities”), incurred by the
        Buyer Indemnitees or any of them as a result of, or arising out of, or relating
        to (a) any misrepresentation or breach of any representation or warranty
        made by
        the Company in this Agreement, the Secured Debentures or the Investor
        Registration Rights Agreement or any other certificate, instrument or document
        contemplated hereby or thereby, (b) any breach of any covenant, agreement
        or
        obligation of the Company contained in this Agreement, or the Investor
        Registration Rights Agreement or any other certificate, instrument or document
        contemplated hereby or thereby, or (c) any cause of action, suit or claim
        brought or made against such Indemnitee and arising out of or resulting from
        the
        execution, delivery, performance or enforcement of this Agreement or any
        other
        instrument, document or agreement executed pursuant hereto by any of the
        Indemnities, any transaction financed or to be financed in whole or in part,
        directly or indirectly, with the proceeds of the issuance of the Secured
        Debentures or the status of the Buyer or holder of the Secured
        Debentures  the Warrants or the shares underlying the Warrants, as a
        Buyer of Secured Debentures in the Company.  To the extent that the
        foregoing undertaking by the Company may be unenforceable for any reason,
        the
        Company shall make the maximum contribution to the payment and satisfaction
        of
        each of the Indemnified Liabilities, which is permissible under applicable
        law.

    

     

    (b)    In
      consideration of the Company’s execution and delivery of this Agreement, and in
      addition to all of the Buyer’s other obligations under this Agreement, the Buyer
      shall defend, protect, indemnify and hold harmless the Company and all of its
      officers, directors, employees and agents (including, without limitation, those
      retained in connection with the transactions contemplated by this Agreement)
      (collectively, the “Company Indemnitees”) from and against any and all
      Indemnified Liabilities incurred by the Indemnitees or any of them as a result
      of, or arising out of, or relating to (a) any misrepresentation or breach of
      any
      representation or warranty made by the Buyer(s) in this Agreement, , instrument
      or document contemplated hereby or thereby executed by the Buyer, (b) any breach
      of any covenant, agreement or obligation of the Buyer(s) contained in this
      Agreement,  the Investor Registration Rights Agreement or any other
      certificate, instrument or document contemplated hereby or thereby executed
      by
      the Buyer, or (c) any cause of action, suit or claim brought or made against
      such Company Indemnitee based on material misrepresentations or due to a
      material breach and arising out of or resulting from the execution, delivery,
      performance or enforcement of this Agreement, the Investor Registration Rights
      Agreement or any other instrument, document or agreement executed pursuant
      hereto by any of the Company Indemnities.  To the extent that the
      foregoing undertaking by each Buyer may be unenforceable for any reason, each
      Buyer shall make the maximum contribution to the payment and satisfaction of
      each of the Indemnified Liabilities, which is permissible under applicable
      law.

     

     

     

    
      
        
        

      

      
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    9.           GOVERNING
      LAW: MISCELLANEOUS.

     

    (a)    Governing
      Law.  This Agreement shall be governed by and interpreted in
      accordance with the laws of the State of Florida without regard to the
      principles of conflict of laws.  The parties further agree that any
      action between them shall be heard in Broward County, Florida and expressly
      consent to the jurisdiction and venue of the State Court sitting in Broward
      County, Florida and the United States District Court for the Southern District
      of Florida for the adjudication of any civil action asserted pursuant to this
      Paragraph.

     

    (b)    Counterparts.  This
      Agreement may be executed in two or more identical counterparts, all of which
      shall be considered one and the same agreement and shall become effective when
      counterparts have been signed by each party and delivered to the other
      party.  In the event any signature page is delivered by facsimile
      transmission, the party using such means of delivery shall cause four (4)
      additional original executed signature pages to be physically delivered to
      the
      other party within five (5) days of the execution and delivery
      hereof.

     

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

     

    (d)    Severability.  If
      any provision of this Agreement shall be invalid or unenforceable in any
      jurisdiction, such invalidity or unenforceability shall not affect the validity
      or enforceability of the remainder of this Agreement in that jurisdiction or
      the
      validity or enforceability of any provision of this Agreement in any other
      jurisdiction.

     

    (e)    Entire
      Agreement, Amendments.  This Agreement supersedes all other prior
      oral or written agreements between the Buyer(s), the Company, their affiliates
      and persons acting on their behalf with respect to the matters discussed herein,
      and this Agreement and the instruments referenced herein contain the entire
      understanding of the parties with respect to the matters covered herein and
      therein and, except as specifically set forth herein or therein, neither the
      Company nor any Buyer makes any representation, warranty, covenant or
      undertaking with respect to such matters.  No provision of this
      Agreement may be waived or amended other than by an instrument in writing signed
      by the party to be charged with enforcement.

     

    (f)    Notices.  Any
      notices, consents, waivers, or other communications required or permitted to
      be
      given under the terms of this Agreement must be in writing and will be deemed to
      have been delivered (i) upon receipt, when delivered personally; (ii) upon
      confirmation of receipt, when sent by facsimile; (iii) three (3) days after
      being sent by U.S. certified mail, return receipt requested, or (iv) one (1)
      day
      after deposit with a nationally recognized overnight delivery service, in each
      case properly addressed to the party to receive the same.  The
      addresses and facsimile numbers for such communications shall be:

     

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    
      	
              If
                to the Company, to:

            	
              C-Mark
                International, Inc.

            
	 	
              4130
                E. Van Buren, Suite 325

            
	 	
              Phoenix,
                AZ 85008

            
	 	
              Attn:
                Mr. Charles Jones, CEO

            
	 	
              Telephone:
                (602) 443-8640

            
	 	
              Facsimile:
                (602) 443-8646

            
	 	 
	
              With
                a copy to:

            	
              The
                O’Neal Law Firm, P.C.

            
	 	
              17100
                E. Shea Blvd., Suite 400-D

            
	 	
              Fountain
                Hills, AZ  85268

            
	 	
              Attention: William
                D. O’Neal, Esq.

            
	 	
              Telephone:
                (480) 812-5058

            
	 	
              Facsimile:
                (480) 816-9241

            
	 	 
	
              If
                to the Transfer Agent, to:

            	
              First
                American Stock Transfer

            
	 	
              706
                E. Bell Road

            
	 	
              Suite
                202

            
	 	
              Phoenix,
                AZ 85012

            
	 	
              Attention:
                Salli Marinov

            
	 	
              Telephone:
                (602) 485-1346

            
	 	
              Facsimile:
                (602) 788-0423

            
	 	 
	
              With
                Copy to:

            	
              James
                G. Dodrill II, P.A.

            
	 	
              5800
                Hamilton Way

            
	 	
              Boca
                Raton, FL  33496

            
	 	
              Attention: Jim
                Dodrill, Esq.

            
	 	
              Telephone: (561)
                862-0529

            
	 	
              Facsimile:
                (561) 892-7787

            
	 	 

    

    If
      to the
      Buyer(s), to its address and facsimile number on Schedule I, with copies to
      the
      Buyer’s counsel as set forth on Schedule I.  Each party shall provide
      five (5) days’ prior written notice to the other party of any change in address
      or facsimile number.

     

    (g)    Successors
      and Assigns.  This Agreement shall be binding upon and inure to
      the benefit of the parties and their respective successors and
      assigns.  Neither the Company nor any Buyer shall assign this
      Agreement or any rights or obligations hereunder without the prior written
      consent of the other party hereto.

    

    (h)           No
      Third Party Beneficiaries.  This Agreement is intended for the
      benefit of the parties hereto and their respective permitted successors and
      assigns, and is not for the benefit of, nor may any provision hereof be enforced
      by, any other person.

     

    (i)    Survival.  Unless
      this Agreement is terminated under Section 9(l), the representations and
      warranties of the Company and the Buyer(s) contained in Sections 2 and 3, the
      agreements and covenants set forth in Sections 4, 5 and 9, and the
      indemnification provisions set forth in Section 8, shall survive the Closing
      for
      a period of two (2) years following the date on which the Secured Debentures
      are
      converted in full.  The Buyer(s) shall be responsible only for its own
      representations, warranties, agreements and covenants hereunder.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    (j)    Publicity.  The
      Company and the Buyer(s) shall have the right to approve, before issuance any
      press release or any other public statement with respect to the transactions
      contemplated hereby made by any party; provided, however, that the Company
      shall
      be entitled, without the prior approval of the Buyer(s), to issue any press
      release or other public disclosure with respect to such transactions required
      under applicable securities or other laws or regulations (the Company shall
      use
      its best efforts to consult the Buyer(s) in connection with any such press
      release or other public disclosure prior to its release and Buyer(s) shall
      be
      provided with a copy thereof upon release thereof).

     

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

     

    (l)    Termination.  In
      the event that the Closing shall not have occurred with respect to the Buyers
      on
      or before five (5) business days from the date hereof due to the Company’s or
      the Buyer’s failure to satisfy the conditions set forth in Sections 6 and 7
      above (and the non-breaching party’s failure to waive such unsatisfied
      condition(s)), the non-breaching party shall have the option to terminate this
      Agreement with respect to such breaching party at the close of business on
      such
      date without liability of any party to any other party; provided, however,
      that
      if this Agreement is terminated by the Company pursuant to this Section 9(l),
      the Company shall remain obligated to pay the Buyer(s) for the structuring
      fee
      described in Section 4(g) above.

     

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

     

    

    [REMAINDER
      PAGE INTENTIONALLY LEFT BLANK]

     

     

     

     

    

    
      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

    

    

    

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

     

    

    
      	 	
              COMPANY:

            
	 	
              CMARK
                INTERNATIONAL, INC.

            
	 	 
	 	 
	 	
              By:       /s/
                  Charles Jones,
                Jr.                                                     

            
	 	
              Name:        
                Charles Jones, Jr.

            
	 	
              Title:           President/CEO

            
	 	 

    

    

    
      	 	
              BUYER:

            
	 	
              TRAFALGAR
                CAPITAL SPECIALIZED

            
	 	
              INVESTMENT
                FUND, LUXEMBOURG

            
	 	
              By:           Trafalgar
                Capital Sarl

            
	 	
              Its:           General
                Partner

            
	 	 
	 	 
	 	
              By:        /s/ 
                Andrew
                Garai                
                                                                      

            
	 	
              Name:         Andrew
                Garai

            
	 	
              Title:           Chairman
                of the Board

            

    

    

    

    
      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

    

    

    

    EXHIBIT
      A

    

     

    FORM
      OF INVESTOR REGISTRATION RIGHTS AGREEMENT

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
 

    

    

    

    
      
        
          
          

        

        
          A-1

          
            

          

        

        
          
          

        

      

    

    

    

    EXHIBIT
      B

    

     

    FORM
      OF ESCROW AGREEMENT

     

    

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
 

    

    

    
      
        
          
          

        

        
          B-1

          
            

          

        

        
          
          

        

      

    

    

    

    EXHIBIT
      C

     

    TRANSFER
      AGENT INSTRUCTIONS

     

    

     

     

     

     

     

     

     

     

     

     

     

    
 

    

    

    
      
        
          
          

        

        
          C-1

          
            

          

        

        
          
          

        

      

    

    

    

     

    SCHEDULE
      I

     

     

    SCHEDULE
      OF BUYERS

     

    

    
      	
              
                Name

              

            	
              
                Signature

              

            	
              
                Address/Facsimile

                Number
                  of Buyer

              

            	
              
                Amount
                  of Subscription

              

            
	 	 	
              8-10
                Rue Mathias Hardt

            	 
	
              Trafalgar
                Capital Specialized

            	
              By:           Trafalgar
                Capital Sarl

            	
              BP
                3023

            	
              $        1,000,000

            
	
              Investment
                Fund, Luxembourg

            	
              Its:           General
                Partner

            	
              L-1030
                Luxembourg

            	 
	 	 	
              Facsimile:

            	 
	 	 	
              011-44-207-405-0161

            	 
	 	
              By:    /s/ 
                 Andrew
                Garai                

            	
              and

            	 
	 	
              Name:      Andrew
                Garai

            	
              001-786-323-1651

            	 
	 	
              Its:           Chairman
                of the Board

            	 	 

    

    

    Buyer’s
      Counsel:

    

    James
      G.
      Dodrill II, P.A.

    5800
      Hamilton Way

    Boca
      Raton, FL  33496

    Telephone:
      (561) 862-0529

    Facsimile:
      (561) 892-7787

     

     

     

     

     

     D-1

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