Document:

Exhibit 10.1

 

Execution Version

 

Talecris Biotherapeutics Holdings Corp.

 

7.75% Senior Notes due
2016

 

REGISTRATION
RIGHTS AGREEMENT

 

October 21, 2009

 

Morgan Stanley & Co. Incorporated

Goldman, Sachs & Co.

Wells Fargo Securities, LLC

Citigroup Global Markets Inc.

As Representatives of the Initial Purchasers

c/o Morgan Stanley & Co. Incorporated

      1585 Broadway, 

      New York, NY 10036

 

Ladies and Gentlemen:

 

Talecris
Biotherapeutics Holdings Corp., a corporation organized under the laws of
Delaware (the “Company”), proposes to issue and sell to certain purchasers (the
“Initial Purchasers”), for whom you (the “Representatives”) are acting as
representatives, its 7.75% Senior Notes due 2016 (the “Notes”) to be guaranteed
(the “Guarantees” and, together with the Notes, “the Securities”) by the
entities listed in Schedule A (the “Guarantors”), upon the terms set forth in
the Purchase Agreement among the Company, the Guarantors and the
Representatives dated October 16, 2009 (the “Purchase Agreement”) relating
to the initial placement (the “Initial Placement”) of the Securities.  To induce the Initial Purchasers to enter
into the Purchase Agreement and to satisfy a condition to your obligations
thereunder, the Company agrees with you for your benefit and the benefit of the
holders from time to time of the Securities (including the Initial Purchasers)
(each a “Holder” and, collectively, the “Holders”), as follows:

 

1.             Definitions.  Capitalized terms used herein without
definition shall have their respective meanings set forth in the Purchase
Agreement.  As used in this Agreement,
the following capitalized defined terms shall have the following meanings:

 

“Act” shall mean the Securities Act of 1933, as
amended, and the rules and regulations of the Commission promulgated
thereunder.

 

“Affiliate”
shall have the meaning specified in Rule 405 under the Act and the terms “controlling”
and “controlled” shall have meanings correlative thereto.

 

“Broker-Dealer”
shall mean any broker or dealer registered as such under the Exchange Act.

 

“Business
Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a
day on which banking institutions or trust companies are authorized or
obligated by law to close in New York City.

 

1

 

“Closing
Date” shall mean the date of the first issuance of the Securities.

 

“Commission”
shall mean the Securities and Exchange Commission.

 

“Deferral
Period” shall have the meaning indicated in Section 4(j)(ii) hereof.

 

“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.

 

“Exchange
Offer Registration Period” shall mean the period following the
consummation of the Registered Exchange Offer and ending on the earlier of (i) the
90th day following consummation of the Registered
Exchange Offer or such longer period if extended pursuant to Section 4(j) as
a result of the occurrence of any of the events set forth in Sections 4(b)(ii) through
(v) hereof and (ii) such time as no Exchanging Dealer holds
Registrable Securities, exclusive of any period during which any stop order
shall be in effect suspending the effectiveness of the Exchange Offer
Registration Statement.

 

“Exchange
Offer Registration Statement” shall mean a registration statement of the
Company on an appropriate form under the Act with respect to the Registered
Exchange Offer, all amendments and supplements to such registration statement,
including post-effective amendments thereto, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.

 

“Exchanging
Dealer” shall mean any Holder (which may include any Initial Purchaser) that is
a Broker-Dealer and elects to exchange any Securities that it acquired for its
own account as a result of market-making activities or other trading activities
(but not directly from the Company or any Affiliate of the Company) for New
Securities.

 

“Final
Memorandum” shall mean the offering memorandum, dated October 16, 2009,
relating to the Securities, including any and all exhibits thereto and any
information incorporated by reference therein as of such date.

 

“FINRA
Rules” shall mean the Conduct Rules of The Financial Industry Regulatory
Authority.

 

“Holder”
shall have the meaning set forth in the preamble hereto.

 

“Indenture”
shall mean the Indenture relating to the Securities, dated as of October 21,
2009, between the Company, the Guarantors and The Bank of New York Mellon Trust
Company, N.A., as trustee, as the same may be amended from time to time in
accordance with the terms thereof.

 

“Initial
Placement” shall have the meaning set forth in the preamble hereto.

 

“Initial
Purchaser” shall have the meaning set forth in the preamble hereto.

 

“Issuer
FWP” shall mean the “issuer free writing prospectus” as defined in Rule 433
under the Act.

 

2

 

“Losses”
shall have the meaning set forth in Section 6(d) hereof.

 

“Majority
Holders” shall mean, on any date, Holders of a majority of the aggregate
principal amount of Securities registered under a Registration Statement.

 

“Managing
Underwriters” shall mean the investment banker or investment bankers and
manager or managers that administer an underwritten offering, if any, under a
Registration Statement.

 

“New
Securities” shall mean debt securities of the Company identical in all material
respects to the Securities (except that the transfer restrictions shall be
modified or eliminated, as appropriate) to be issued under the Indenture.

 

“Prospectus”
shall mean the prospectus included in any Registration Statement (including,
without limitation, a prospectus that discloses information previously omitted
from a prospectus filed as part of an effective registration statement in
reliance upon Rule 430A under the Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Securities or the New Securities covered by such Registration Statement,
and all amendments and supplements thereto, including any and all exhibits
thereto and any information incorporated by reference therein.

 

“Purchase
Agreement” shall have the meaning set forth in the preamble hereto.

 

“Registered
Exchange Offer” shall mean the proposed offer of the Company to issue and
deliver to the Holders of the Securities that are not prohibited by any law or
policy of the Commission from participating in such offer, in exchange for the
Securities, a like aggregate principal amount of the New Securities.

 

“Registrable
Securities” shall mean (i) Securities other than those that have been (A) registered
under a Registration Statement and disposed of in accordance therewith or (B) distributed
to the public pursuant to Rule 144 under the Act or any successor rule or
regulation thereto that may be adopted by the Commission and (ii) any New
Securities resale of which by the Holder thereof requires compliance with the
prospectus delivery requirements of the Act.

 

“Registration
Default Damages” shall have the meaning set forth in Section 8 hereof.

 

“Registration
Statement” shall mean any Exchange Offer Registration Statement or Shelf
Registration Statement that covers any of the Securities or the New Securities
pursuant to the provisions of this Agreement, any amendments and supplements to
such registration statement, including post-effective amendments (in each case
including the Prospectus contained therein), all exhibits thereto and all
material incorporated by reference therein.

 

“Securities”
shall have the meaning set forth in the preamble hereto.

 

“Shelf
Registration” shall mean a registration effected pursuant to Section 3
hereof.

 

“Shelf
Registration Period” has the meaning set forth in Section 3(b) hereof.

 

3

 

“Shelf
Registration Statement” shall mean a “shelf” registration statement of the
Company pursuant to the provisions of Section 3 hereof which covers some
or all of the Securities or New Securities, as applicable, on an appropriate
form under Rule 415 under the Act, or any similar rule that may be
adopted by the Commission, amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.

 

“Trustee”
shall mean the trustee with respect to the Securities under the Indenture.

 

“Trust
Indenture Act” shall mean the Trust Indenture Act of 1939, as amended, and the rules and
regulations of the Commission promulgated thereunder.

 

“Underwriter”
shall mean any underwriter of Securities in connection with an offering thereof
under a Shelf Registration Statement.

 

2.             Registered Exchange Offer.  (a) Unless the Registered Exchange Offer
shall not be permissible under applicable law or Commission policy, the Company
shall prepare and, not later than 180 days following the Closing Date (or if
such day is not a business day, the next succeeding business day), shall file
with the Commission the Exchange Offer Registration Statement with respect to
the Registered Exchange Offer.  The
Company shall use its commercially reasonable efforts to cause the Exchange
Offer Registration Statement to become effective under the Act within 240 days
of the Closing Date (or if such day is not a business day, the next succeeding
business day).

 

(b)           Upon the effectiveness of the
Exchange Offer Registration Statement, the Company shall as soon as practicable
commence the Registered Exchange Offer, it being the objective of such Registered
Exchange Offer to enable each Holder so electing to exchange Securities for New
Securities (assuming that such Holder is not an Affiliate of the Company,
acquires the New Securities in the ordinary course of such Holder’s business,
has no arrangements with any person to participate in the distribution of the
New Securities and is not prohibited by any law or policy of the Commission
from participating in the Registered Exchange Offer) to trade such New
Securities from and after their receipt without any limitations or restrictions
under the Act and without material restrictions under the securities laws of a
substantial proportion of the several states of the United States.  The Company shall use its commercially
reasonable efforts to consummate the Registered Exchange Offer no later than 45
days after the Exchange Offer Registration Statement is declared effective.

 

(c)           In connection with the Registered
Exchange Offer, the Company shall:

 

(i)            mail to each Holder a copy of the
Prospectus forming part of the Exchange Offer Registration Statement, together
with an appropriate letter of transmittal and related documents; provided, that the
Company shall only be required to mail such Prospectus to Holders of which the
Company are aware after due inquiry;

 

(ii)           keep the Registered Exchange Offer
open for not less than 20 Business Days after the date notice thereof is mailed
to the Holders (or, in each case, longer if required by applicable law) (the “Expiration
Date”);

 

4

 

(iii)          use its commercially reasonable
efforts to keep the Exchange Offer Registration Statement continuously
effective under the Act, supplemented and amended as required, under the Act to
ensure that it is available for sales of New Securities by Exchanging Dealers
during the Exchange Offer Registration Period;

 

(iv)          cause the Exchange Offer Registration
Statement and the related Prospectus and any amendment or supplement thereto,
as of the effective date of the Exchange Offer Registration Statement or such
amendment or supplement, (A) to comply in all material respects with the
applicable requirements of the Act; and (B) not to contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein (in the
case of the Prospectus, in the light of the circumstances under which they were
made) not misleading; it being understood that the Company shall not be so
responsible for written information furnished to the Company by or on behalf of
Holders expressly for use therein;

 

(v)           utilize the services of a depositary
for the Registered Exchange Offer with an address in the Borough of Manhattan
in New York City, which may be the Trustee or an Affiliate of the Trustee;

 

(vi)          permit Holders to withdraw tendered
Securities at any time prior to the close of business, New York time, on the
last Business Day on which the Registered Exchange Offer is open;

 

(vii)         prior to effectiveness of the Exchange
Offer Registration Statement, provide a supplemental letter to the Commission (A) stating
that the Company is conducting the Registered Exchange Offer in reliance on the
position of the Commission in Exxon Capital Holdings Corporation (pub.
avail. May 13, 1988), Morgan Stanley and Co., Inc. (pub.
avail. June 5, 1991); and (B) including a representation that the
Company has not entered into any arrangement or understanding with any person
to distribute the New Securities to be received in the Registered Exchange
Offer and that, to the best of the Company’s information and belief, each
Holder participating in the Registered Exchange Offer is acquiring the New
Securities in the ordinary course of business and has no arrangement or
understanding with any person to participate in the distribution of the New
Securities; and

 

(viii)        comply in all respects with all
applicable laws.

 

(d)           As
soon as practicable after the close of the Registered Exchange Offer, the
Company shall:

 

(i)            accept for exchange all Securities
validly tendered and not validly withdrawn pursuant to the Registered Exchange
Offer;

 

(ii)           deliver to the Trustee for
cancellation in accordance with Section 4(r) all Securities so
accepted for exchange; and

 

5

 

(iii)          cause the Trustee as soon as
practicable to authenticate and deliver to each Holder of Securities a
principal amount of New Securities equal to the principal amount of the
Securities of such Holder so accepted for exchange.

 

(e)           Each Holder hereby acknowledges and
agrees that any Broker-Dealer and any such Holder using the Registered Exchange
Offer to participate in a distribution of the New Securities (x) could not
under Commission policy as in effect on the date of this Agreement rely on the
position of the Commission in Exxon Capital Holdings Corporation (pub.
avail. May 13, 1988) and Morgan Stanley and Co., Inc. (pub.
avail. June 5, 1991), as interpreted in the Commission’s letter to
Shearman & Sterling dated July 2, 1993 and similar no-action
letters; and (y) must comply with the registration and prospectus delivery
requirements of the Act in connection with any secondary resale transaction,
which must be covered by an effective registration statement containing the
selling security holder information required by Item 507 or 508, as
applicable, of Regulation S-K under the Act if the resales are of New
Securities obtained by such Holder in exchange for Securities acquired by such
Holder directly from the Company or one of its Affiliates.  Accordingly, each Holder participating in the
Registered Exchange Offer shall be required to represent to the Company that,
at the time of the consummation of the Registered Exchange Offer:

 

(i)            any New Securities received by such
Holder will be acquired in the ordinary course of business;

 

(ii)           such Holder will have no arrangement
or understanding with any person to participate in the distribution of the
Securities or the New Securities within the meaning of the Act; and

 

(iii)          such Holder is not an Affiliate of the
Company;

 

(f)            If any Initial Purchaser determines
that it is not eligible to participate in the Registered Exchange Offer with
respect to the exchange of Securities constituting any portion of an unsold
allotment, at the request of such Initial Purchaser within 20 days after the
consummation of the Exchange Offer, the Company shall issue and deliver to such
Initial Purchaser (exclusively for resale under a Shelf Registration Statement
or pursuant to an applicable exemption from registration) or the person
purchasing New Securities registered under a Shelf Registration Statement as
contemplated by Section 3 hereof from such Initial Purchaser, in exchange
for such Securities, a like principal amount of New Securities.  The Company shall use its commercially
reasonable efforts to cause the CUSIP Service Bureau to issue the same CUSIP
number for such New Securities as for New Securities issued pursuant to the
Registered Exchange Offer.

 

3.             Shelf Registration.  (a) If (i) due to any change in law
or applicable interpretations thereof by the Commission’s staff, the Company
determines upon advice of its outside counsel that it is not permitted to
effect the Registered Exchange Offer as contemplated by Section 2 hereof; (ii) for
any other reason the Registered Exchange Offer is not consummated within 285
days of the Closing Date; (iii) any Initial Purchaser so requests within
20 days after the consummation of the Exchange Offer with respect to Securities
that are not eligible to be exchanged for New Securities in the Registered Exchange
Offer and that are held by it following 

 

6

 

consummation of
the Registered Exchange Offer; (iv) any Holder (other than an Initial
Purchaser) who notifies the Company within 20 days after the consummation of
the Exchange Offer that it is not eligible to participate in the Registered
Exchange Offer other than by reason of such Holder being an affiliate of the
Company (it being understood that the requirement that an Exchanging Dealer
deliver the Prospectus contained in the Exchange Offer Registration Statement
in connection with the sale of New Securities shall not result in such New
Securities being not “freely tradeable”) and holds Securities pending consummation of the
Registered Exchange Offer, so requests; or (v) in the case of any Initial
Purchaser that participates in the Registered Exchange Offer or acquires New
Securities pursuant to Section 2(f) hereof, such Initial Purchaser
does not receive freely tradeable New Securities in exchange for Securities
constituting any portion of an unsold allotment (it being understood that (x) the
requirement that an Initial Purchaser deliver a Prospectus containing the
information required by Item 507 or 508 of Regulation S-K under the Act in
connection with sales of New Securities acquired in exchange for such
Securities shall result in such New Securities being not “freely tradeable”;
and (y) the requirement that an Exchanging Dealer deliver a Prospectus in
connection with sales of New Securities acquired in the Registered Exchange
Offer in exchange for Securities acquired as a result of market-making
activities or other trading activities shall not result in such New Securities
being not “freely tradeable”), the Company shall effect a Shelf Registration
Statement in accordance with subsection (b) below.

 

(b)           (i) The Company shall as promptly as practicable
(but in no event (i) if the Exchange Offer Registration Statement
is not permitted to be filed by applicable law, more than 180 days following
the Closing Date and (ii) in any other circumstance in which a Shelf
Registration Statement is required to be filed, more than 90 days after so
required or requested pursuant to this Section 3), file with the Commission and shall use
its commercially reasonable efforts to cause to be declared effective under the
Act (i) if the Exchange Offer Registration Statement is not declared
effective by the SEC within 240 days of the Closing Date, within 240 days after
the Closing Date, (ii) if the Registered Exchange Offer is not consummated
within 285 days of the Closing Date, within 285 days of the Closing Date or (iii) in
any other circumstance in which a Shelf Registration Statement is required to
be filed, within 180 days after so required or requested, a Shelf Registration
Statement relating to the offer and sale of the Securities or the New
Securities, as applicable, by the Holders thereof from time to time in
accordance with the methods of distribution elected by such Holders and set
forth in such Shelf Registration Statement; provided, however,
that no Holder (other than an Initial Purchaser) shall be entitled to have the
Securities held by it covered by such Shelf Registration Statement unless such
Holder agrees in writing to be bound by all of the provisions of this Agreement
applicable to such Holder (with the Initial Purchasers’ agreement thereto being
evidenced by their execution of this Agreement); and provided further, that
with respect to New Securities received by an Initial Purchaser in exchange for
Securities constituting any portion of an unsold allotment, the Company may, if
permitted by current interpretations by the Commission’s staff, file a
post-effective amendment to the Exchange Offer Registration Statement
containing the information required by Item 507 or 508 of Regulation S-K,
as applicable, in satisfaction of its obligations under this subsection with
respect thereto, and any such Exchange Offer Registration Statement, as so
amended, shall be referred to herein as, and governed by the provisions herein
applicable to, a Shelf Registration Statement.

 

7

 

(ii)           Subject to Section 4(j), the
Company shall use its commercially reasonable efforts to keep the Shelf
Registration Statement continuously effective, supplemented and amended as
required by the Act, in order to permit the Prospectus forming part thereof to
be usable by Holders for a period (the “Shelf Registration Period”) from the
date the Shelf Registration Statement is declared effective by the Commission
until the earliest of (A) the second anniversary thereof, (B) the
date upon which all the Securities or New Securities, as applicable, covered by
the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement, and (C) the date upon which the Securities or New
Securities, as applicable, are no longer restricted securities (as defined in Rule 144
under the Act, or any successor rule thereof).  The Company shall be deemed not to have used
its commercially reasonable efforts to keep the Shelf Registration Statement
effective during the Shelf Registration Period if it voluntarily takes any
action that would result in Holders of Securities covered thereby not being
able to offer and sell such Securities at any time during the Shelf Registration
Period, unless such action is (x) required by applicable law or otherwise
undertaken by the Company in good faith and for valid business reasons (not
including avoidance of the Company’s obligations hereunder), including the
acquisition or divestiture of assets, and (y) permitted pursuant to Section 4(j)(ii) hereof.

 

(iii)          The Company shall cause the Shelf
Registration Statement and the related Prospectus and any amendment or
supplement thereto, as of the effective date of the Shelf Registration Statement
or such amendment or supplement, (A) to comply in all material respects
with the applicable requirements of the Act; and (B) not to contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein (in
the case of the Prospectus, in the light of the circumstances under which they
were made) not misleading; it being understood that the Company shall
not be so responsible for written information furnished to the Company by or on
behalf of Holders expressly for use therein.

 

4.             Additional Registration
Procedures.  In connection with any
Shelf Registration Statement and, to the extent applicable, any Exchange Offer
Registration Statement, the following provisions shall apply.

 

(a)           The Company shall:

 

(i)            furnish, in each case if requested
in writing, to each of the Representatives and to counsel for the
Representatives, in the case of an Exchange Offer Registration Statement, and
to counsel for the Holders of Registrable Securities, in the case of a Shelf
Registration Statement, not less than five Business Days prior to the filing
thereof with the Commission, a copy of any Exchange Offer Registration
Statement and any Shelf Registration Statement, as applicable, and each
amendment thereof and each amendment or supplement, if any, to the Prospectus
included therein (including all documents incorporated by reference therein
after the initial filing) and shall use its commercially reasonable efforts to
reflect in each such document, when so filed with the Commission, such comments
as the Representatives reasonably propose;

 

(ii)           include the information set forth in
Annex A hereto on the facing page of the Exchange Offer Registration
Statement, in Annex B hereto in the forepart of the

 

8

 

Exchange Offer Registration Statement in a section
setting forth details of the Exchange Offer, in Annex C hereto in the
underwriting or plan of distribution section of the Prospectus contained in the
Exchange Offer Registration Statement, and in Annex D hereto in the letter of
transmittal delivered pursuant to the Registered Exchange Offer;

 

(iii)          if requested by a Representative,
include the information required by Item 507 or 508 of Regulation S-K, as
applicable, in the Prospectus contained in the Exchange Offer Registration
Statement;

 

(iv)          include within the Prospectus
contained in the Exchange Offer Registration Statement a section entitled “Plan
of Distribution,” reasonably acceptable to the Representatives, which shall
contain a summary statement of the positions taken or policies made by the
staff of the Commission with respect to the potential “underwriter” status of
any broker-dealer that is the beneficial owner (as defined in Rule 13d-3
under the Exchange Act) of New Securities received by such Broker-Dealer in the
Registered Exchange Offer, whether such positions or policies have been
publicly disseminated by the staff of the Commission or such positions or
policies, in the reasonable judgment of the Representatives based upon advice
of counsel (which may be in house counsel), represent the prevailing views of
the staff of the Commission; and

 

(v)           in the case of a Shelf Registration
Statement, include the names of the Holders that propose to sell Securities
pursuant to the Shelf Registration Statement as selling security holders.

 

(b)           The Company shall advise the
Representatives, the Holders of Securities covered by any Shelf Registration
Statement (but only to such Holders as are named as selling security holders in
the prospectus forming part of such Shelf Registration Statement or in a
supplement to such Prospectus) and any Exchanging Dealer under any Exchange Offer
Registration Statement that has provided in writing to the Company a telephone
or facsimile number and address for notices, and, if requested by any
Representative or any such Holder or Exchanging Dealer, shall confirm such
advice in writing (which notice pursuant to clauses (ii)-(v) hereof shall
be accompanied by an instruction to suspend the use of the Prospectus until the
Company shall have remedied the basis for such suspension):

 

(i)            when a Registration Statement and
any amendment thereto has been filed with the Commission and when the
Registration Statement or any post-effective amendment thereto has become
effective;

 

(ii)           of any request by the Commission for
any amendment or supplement to the Registration Statement or the Prospectus or
for additional information;

 

(iii)          of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or
the institution of any proceeding for that purpose;

 

(iv)          of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
securities included therein for sale in any jurisdiction or the institution or
threatening of any proceeding for such purpose; and

 

9

 

(v)           unless notice has been provided
pursuant to Section 4(j)(ii) hereto, of the happening of any event
that requires any change in the Registration Statement or the Prospectus so
that, as of such date, they (A) do not contain any untrue statement of a
material fact and (B) do not omit to state a material fact required to be
stated therein or necessary to make the statements therein (in the case of the
Prospectus, in the light of the circumstances under which they were made) not
misleading.

 

(c)           The Company shall use its
commercially reasonable efforts to prevent the issuance of any order suspending
the effectiveness of any Registration Statement or the qualification of the
securities therein for sale in any jurisdiction and, if issued, to obtain as
soon as possible the withdrawal thereof.

 

(d)           The Company shall furnish to each
Holder of Securities covered by any Shelf Registration Statement, without
charge, at least one copy of such Shelf Registration Statement and any
post-effective amendment thereto, including all material incorporated therein
by reference, and, if the Holder so requests in writing, all exhibits thereto
(including exhibits incorporated by reference therein).

 

(e)           The Company shall, during the Shelf
Registration Period, deliver to each Holder of Securities covered by any Shelf
Registration Statement, without charge, as many copies of the Prospectus
(including any preliminary prospectus) included in such Shelf Registration
Statement and any amendment or supplement thereto as such Holder may reasonably
request in writing.  Subject to the
provisions of this agreement, the Company consents to the use of the Prospectus
or any amendment or supplement thereto by each of the selling Holders of
Securities in connection with the offering and sale of the Securities covered
by the Prospectus, or any amendment or supplement thereto, included in the
Shelf Registration Statement.

 

(f)            The Company shall furnish to each
Exchanging Dealer which so requests, without charge, at least one copy of the
Exchange Offer Registration Statement and any post-effective amendment thereto,
including all material incorporated by reference therein, and, if the
Exchanging Dealer so requests in writing, all exhibits thereto (including
exhibits incorporated by reference therein).

 

(g)           The Company shall promptly deliver to
each Initial Purchaser, each Exchanging Dealer and each other person required
to deliver a Prospectus during the Exchange Offer Registration Period, without
charge, as many copies of the Prospectus included in such Exchange Offer
Registration Statement and any amendment or supplement thereto as any such
person may reasonably request in writing. 
The Company consents, subject to the provisions of this Agreement, to
the use of the Prospectus or any amendment or supplement thereto by any Initial
Purchaser, any Exchanging Dealer and any such other person that may be required
to deliver a Prospectus following the Registered Exchange Offer in connection
with the offering and sale of the New Securities covered by the Prospectus, or
any amendment or supplement thereto, included in the Exchange Offer
Registration Statement.

 

(h)           Prior to the Registered Exchange
Offer or any other offering of Securities pursuant to any Registration
Statement, the Company shall use its reasonable best efforts to arrange, if
necessary, for the qualification of the Securities or the New Securities for
sale under

 

10

 

the laws of such
jurisdictions as any Holder shall reasonably request and shall maintain such
qualification in effect so long as required; provided that in no event shall
the Company be obligated to qualify to do business in any jurisdiction where it
is not then so qualified or to take any action that would subject it to service
of process in suits or to taxation, other than those arising out of the Initial
Placement, the Registered Exchange Offer or any offering pursuant to a Shelf
Registration Statement, in any such jurisdiction where it is not then so
subject.

 

(i)            The Company shall cooperate with the
Holders of Securities to facilitate the timely preparation and delivery of
certificates representing New Securities or Securities to be issued or sold
pursuant to any Registration Statement free of any restrictive legends and in
such denominations and registered in such names as Holders may request a
reasonable period of time prior to sales of Securities pursuant to such
Registration Statement.

 

(j)            (i) Upon the occurrence of any
event contemplated by subsections (c)(ii) through (v) above, the
Company shall promptly (or within the time period provided for by clause (ii) hereof,
if applicable) prepare a post-effective amendment to the applicable
Registration Statement or an amendment or supplement to the related Prospectus
or file any other required document so that, as thereafter delivered to the
purchasers of the Securities included therein, the Prospectus will not include
an untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading.  In such circumstances, the period of
effectiveness of the Exchange Offer Registration Statement provided for in Section 2
shall be extended by the number of days from and including the date of the
giving of a notice of suspension pursuant to Section 4(b) to and
including the date when the Initial Purchasers, the Holders of the Securities
and any known Exchanging Dealer shall have received such amended or
supplemented Prospectus pursuant to this Section.

 

(ii)           Upon the occurrence or existence of any
pending corporate development or any other material event that, in the
reasonable judgment of the Company, makes it appropriate to suspend the
availability of a Shelf Registration Statement and the related Prospectus, the
Company shall give notice (without notice of the nature or details of such
events) to the Holders (but only to such Holders as are named as selling
security holders in the Prospectus forming part of such Shelf Registration
Statement or in a supplement to such Prospectus) that the availability of such Shelf Registration is
suspended and, upon the giving of any such notice in accordance with Section 11
hereof, each Holder agrees not to sell any Registrable Securities
pursuant to the Shelf Registration until such Holder’s receipt of copies of the
supplemented or amended Prospectus, or until it is advised in writing by the
Company that the Prospectus may be used, and has received copies of any additional
or supplemental filings that are incorporated or deemed incorporated by
reference in such Prospectus.  The period
during which the availability of the Shelf Registration and any Prospectus is
suspended (the “Deferral Period”) shall not exceed 45 days in any three-month
period or 90 days in any twelve-month period.

 

(k)           Not later than the effective date of
any Registration Statement, the Company shall provide a CUSIP number for the
Securities or the New Securities, as the case may be, registered under such
Registration Statement and provide the Trustee with printed certificates for
such Securities or New Securities, in a form eligible for deposit with The
Depository Trust Company.

 

11

 

(l)            The Company shall comply with all
applicable rules and regulations of the Commission and shall make
generally available to the holders of Securities and New Securities an earnings
statement satisfying the provisions of Section 11(a) of the Act as
soon as practicable after the effective date of the applicable Registration
Statement and in any event no later than 45 days after the end of a 12-month
period (or 90 days, if such period is a fiscal year) beginning with the first
month of the Company’s first fiscal quarter commencing after the effective date
of the applicable Registration Statement.

 

(m)          The Company shall cause the Indenture
to be qualified under the Trust Indenture Act in a timely manner.  In the event that such qualification would
require the appointment of a new trustee under the Indenture, the Company shall
appoint a new trustee thereunder pursuant to the applicable provisions of the
Indenture.

 

(n)           The Company may require each Holder
of securities to be sold pursuant to any Shelf Registration Statement to furnish
to the Company such information regarding the Holder and the distribution of
such securities as the Company may from time to time reasonably require for
inclusion in such Registration Statement. 
The Company may exclude from such Shelf Registration Statement the
Securities of any Holder that unreasonably fails to furnish such information
within a reasonable time after receiving such request.

 

(o)           In the case of any Shelf Registration
Statement, the Company shall enter into customary agreements (including, if
requested, an underwriting agreement in customary form) and take all other
appropriate actions, if any, as the Holders of a majority of the Securities to
be included in the Shelf Registration Statement shall reasonably request in
order to facilitate the disposition of the Securities.

 

(p)           In
the case of any Shelf Registration Statement, the Company shall:

 

(i)            make reasonably available for inspection by the
Holders of Securities to be registered thereunder, any underwriter
participating in any disposition pursuant to such
Registration Statement, and any attorney, accountant or other agent retained by
the Holders or any such underwriter all relevant financial and other records
and pertinent corporate documents of the Company and its subsidiaries;

 

(ii)           cause the Company’s officers,
directors, employees, accountants and auditors to supply all relevant
information reasonably requested by the Holders or any such underwriter,
attorney, accountant or agent in connection with any such Registration Statement
as is customary for similar due diligence examinations; provided, that
the foregoing due diligence examination shall be coordinated on behalf of the
parties (other than the Initial Purchasers) by one counsel designated by and on
behalf of such parties;

 

(iii)          if requested by any Holder, make such
representations and warranties to the Holders of Securities registered
thereunder and the underwriters, if any, in form, substance and scope as are
customarily made by issuers to underwriters in primary underwritten offerings
and covering matters including, but not limited to, those set forth in the
Purchase Agreement;

 

12

 

(iv)          if requested by any Holder, obtain
opinions of counsel to the Company and updates thereof (which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to the
Managing Underwriters, if any) addressed to each selling Holder and the
underwriters, if any, covering such matters as are customarily covered in
opinions requested in underwritten offerings and such other matters as may be
reasonably requested by such Holders and underwriters;

 

(v)           if requested by any Holder, obtain “comfort”
letters and updates thereof from the independent certified public accountants
of the Company (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data are, or are required
to be, included in the Registration Statement), addressed to each selling
Holder of Securities registered thereunder and the underwriters, if any, in
customary form and covering matters of the type customarily covered in “comfort”
letters in connection with primary underwritten offerings; and

 

(vi)          deliver such documents and
certificates as may be reasonably requested by the Majority Holders or the
Managing Underwriters, if any, including those to evidence compliance with Section 4(j) and
with any customary conditions contained in the underwriting agreement or other
agreement entered into by the Company.

 

The actions set forth in clauses (iii), (iv), (v) and (vi) of
this paragraph (q) shall be performed at (A) the effectiveness of
such Registration Statement and each post-effective amendment thereto; and (B) each
closing under any underwriting or similar agreement as and to the extent
required thereunder.

 

(q)           In
the case of any Exchange Offer Registration Statement, the Company shall, if
requested by an Initial Purchaser, or by a broker dealer that holds Securities
that were acquired as a result of market making or other trading activities:

 

(i)            make reasonably available for
inspection by the requesting party, and any attorney, accountant or other agent
retained by the requesting party, all relevant financial and other records,
pertinent corporate documents and properties of the Company and its
subsidiaries;

 

(ii)           cause the Company’s officers,
directors, employees, accountants and auditors to supply all relevant
information reasonably requested by the requesting party or any such attorney,
accountant or agent in connection with any such Registration Statement as is
customary for similar due diligence examinations; provided, that the
foregoing due diligence examination shall be coordinated on behalf of the
parties (other than the Initial Purchasers) by one counsel designated by and on
behalf of such parties;

 

(iii)          make such representations and
warranties to the requesting party, in form, substance and scope as are
customarily made by issuers to underwriters in primary underwritten offerings
and covering matters including, but not limited to, those set forth in the
Purchase Agreement;

 

13

 

(iv)          obtain opinions of counsel to the
Company and updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the requesting party and its
counsel, addressed to the requesting party, covering such matters as are
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by the requesting party or its
counsel;

 

(v)           obtain “comfort” letters and updates
thereof from the independent certified public accountants of the Company (and,
if necessary, any other independent certified public accountants of any
subsidiary of the Company or of any business acquired by the Company for which
financial statements and financial data are, or are required to be, included in
the Registration Statement), addressed to the requesting party, in customary
form and covering matters of the type customarily covered in “comfort” letters
in connection with primary underwritten offerings, or if requested by the
requesting party or its counsel in lieu of a “comfort” letter, an agreed-upon
procedures letter under Statement on Standards for Attestation Engagements Section 201,
covering matters requested by the requesting party or its counsel; and

 

(vi)          deliver such documents and
certificates as may be reasonably requested by the requesting party or its
counsel, including those to evidence compliance with Section 4(j) and
with conditions customarily contained in underwriting agreements.

 

The
foregoing actions set forth in clauses (iii), (iv), (v), and (vi) of this Section shall
be performed at the close of the Registered Exchange Offer and the effective
date of any post-effective amendment to the Exchange Offer Registration
Statement.

 

(r)            If a Registered Exchange Offer is to
be consummated, upon delivery of the Securities by Holders to the Company (or
to such other person as directed by the Company) in exchange for the New
Securities, the Company shall mark, or caused to be marked, on the Securities
so exchanged that such Securities are being cancelled in exchange for the New
Securities.  In no event shall the
Securities be marked as paid or otherwise satisfied.

 

(s)           The Company shall use its
commercially reasonable efforts if the Securities have been rated prior to the
initial sale of such Securities, to confirm that a rating (which need not be
the same rating from the relevant ratings agencies) will apply to the
Securities or the New Securities, as the case may be, covered by a Registration
Statement.

 

(t)            In the event that any Broker-Dealer
shall underwrite any Securities or participate as a member of an underwriting
syndicate or selling group or “assist in the distribution” (within the meaning
of FINRA Rules) thereof, whether as a Holder of such Securities or as an
underwriter, a placement or sales agent or a broker or dealer in respect thereof,
or otherwise, the Company will assist such Broker-Dealer in complying with the
requirements of such FINRA Rules, including, without limitation, by (i) if
such FINRA Rules, including Rule 2720, shall so require, engaging a “qualified
independent underwriter” (as defined in Rule 2720) to participate in the
preparation of the Registration Statement relating to such Securities, to
exercise usual standards of due diligence in respect thereto and, if any
portion of the offering contemplated by such Registration Statement is an
underwritten offering or is made through a placement or sales agent, to
recommend the yield of such Securities, (ii) indemnifying any such
qualified

 

14

 

independent
underwriter to the extent of the indemnification of underwriters provided in Section 6
hereof and (iii) providing such information to such Broker-Dealer as may
be required in order for such Broker-Dealer to comply with the requirements of
FINRA Rules.

 

(u)           The Company shall use its
commercially reasonable efforts to take all other steps necessary to effect the
registration of the Securities or the New Securities, as the case may be,
covered by a Registration Statement.

 

5.             Registration Expenses.  The Company shall bear all expenses incurred
in connection with the performance of its obligations under Sections 2, 3
and 4 hereof (other than any underwriting discounts or commissions) and, in the
event of any Shelf Registration Statement, will reimburse the Holders for the reasonable
fees and disbursements of one firm or counsel (which shall initially be
Sullivan & Cromwell LLP, but which may be another nationally
recognized law firm experienced in securities matters designated by the
Majority Holders) to act as counsel for the Holders in connection therewith,
and, in the case of any Exchange Offer Registration Statement, will reimburse
the Initial Purchasers for the reasonable fees and disbursements of counsel
acting in connection therewith.

 

6.             Indemnification and Contribution.  (a) Each
of the Company and the Guarantors agrees to indemnify and hold harmless each
Holder of Securities or New Securities, as the case may be, covered by any
Registration Statement, (including the Initial Purchasers and, with respect to
any Prospectus delivery as contemplated in Section 4(g) hereof, each
Exchanging Dealer), the directors, officers, employees, Affiliates and agents
of each such Holder and each person who controls any such Holder within the
meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities (including, without limitation, any legal or
other expenses reasonably incurred in connection with defending or
investigating any such action or claim), joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement as originally filed or in
any amendment thereof, or in any preliminary Prospectus, the Prospectus or
Issuer FWP, or in any amendment thereof or supplement thereto, or arise out of
or are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
(in the case of any preliminary Prospectus, the Prospectus or Issuer FWP, in
the light of the circumstances under which they were made) not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by it in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company or the Guarantors will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company and the Guarantors by or on behalf of the
party claiming indemnification specifically for inclusion therein; provided,
further that, with respect to any untrue statement or omission of
material fact made in any Registration Statement, the indemnity agreement
contained in this Section 6(a) shall not inure to the benefit of any
Holder from whom the person asserting any such losses, claims, damages,
liabilities or expenses purchased Securities or New Securities concerned, or
any person

 

15

 

controlling
such Holders, if a copy of the Prospectus (as then amended or supplements
thereto) was not sent or given by or on behalf of such Holder to such person,
if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Securities or the New Securities to such
person, and if the Prospectus (as so amended or supplemented) would have cured
the defect giving rise to such losses, claims, damages, liabilities or
expenses, unless such failure is the result of noncompliance by the Company or
the Guarantors with Section 4(d)-(g) hereof.  This indemnity agreement shall be in addition
to any liability that the Company or the Guarantors may otherwise have.

 

Each of the Company and the Guarantors also agree to
indemnify as provided in this Section 6(a) or contribute as provided
in Section 6(d) hereof to Losses of each underwriter, if any, of
Securities or New Securities, as the case may be, registered under a Shelf
Registration Statement, their directors, officers, employees, Affiliates or
agents and each person who controls such underwriter on substantially the same
basis as that of the indemnification of the Initial Purchasers and the selling
Holders provided in this Section 6(a) and shall, if requested by any
Holder, enter into an underwriting agreement reflecting such agreement, as
provided in Section 4(o) hereof.

 

(b)           Each Holder of Securities or New
Securities covered by a Registration Statement (including each Initial
Purchaser that is a Holder, in such capacity and, with respect to any
Prospectus delivery as contemplated in Section 4(g) hereof, each
Exchanging Dealer) severally and not jointly agrees to indemnify and hold
harmless the Company, the Guarantors and each of their respective directors,
each of its officers who signs such Registration Statement and each person who
controls the Company or the Guarantors within the meaning of either the Act or
the Exchange Act, to the same extent as the foregoing indemnity from the
Company and the Guarantors to each such Holder, but only with reference to
written information relating to such Holder furnished to the Company by or on
behalf of such Holder specifically for inclusion in the documents referred to
in the foregoing indemnity.  This indemnity agreement will be in
addition to any liability that any such Holder may otherwise have.

 

(c)           Promptly after receipt by an indemnified party under
this Section 6 or notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section, notify the indemnifying party in
writing of the commencement thereof; but the failure so to notify the
indemnifying party (i) will not relieve it from liability under
paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by
the indemnifying party of substantial rights and defenses; and (ii) will
not, in any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in paragraph (a) or
(b) above.  The indemnifying party
shall be entitled to appoint counsel (including local counsel) of the
indemnifying party’s choice at the indemnifying party’s expense to represent
the indemnified party in any action for which indemnification is sought (in
which case the indemnifying party shall not thereafter be responsible for the
fees and expenses of any separate counsel, other than local counsel if not
appointed by the indemnifying party, retained by the indemnified party or
parties except as set forth below); provided, however, that such
counsel shall be satisfactory to the indemnified party.  Notwithstanding the indemnifying party’s
election to appoint counsel (including local counsel) to represent the
indemnified party in an action, the indemnified party shall have the right to
employ separate counsel (including local counsel), and

 

16

 

the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel if (i) the use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a
conflict of interest; (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties that are different from or additional to those available to the
indemnifying party; (iii) the indemnifying party shall not have employed
counsel satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of the institution of such action;
or (iv) the indemnifying party shall authorize the indemnified party to
employ separate counsel at the expense of the indemnifying party.  An indemnifying party will not, without the
prior written consent of the indemnified parties (which consent will not be
unreasonably withheld or delayed), settle or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim, action, suit
or proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.  The indemnifying party shall not be liable
for any settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the plaintiff,
the indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment.

 

(d)           In the event that the indemnity provided in
paragraph (a) or (b) of this Section is unavailable to or
insufficient to hold harmless an indemnified party for any reason for the
losses, claims, damages or liabilities referred to therein, then each
applicable indemnifying party shall have a joint and several obligation to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending any loss, claim, liability, damage or action) (collectively “Losses”)
to which such indemnified party may be subject in such proportion as is
appropriate to reflect the relative benefits received by such indemnifying
party, on the one hand, and such indemnified party, on the other hand, from the
Initial Placement and the Registration Statement which resulted in such Losses;
provided, however, that in no case shall any Initial Purchaser be
responsible, in the aggregate, for any amount in excess of the purchase
discount or commission applicable to such Security, or in the case of a New
Security, applicable to the Security that was exchangeable into such New
Security, as set forth in the Purchase Agreement, nor shall any underwriter be
responsible for any amount in excess of the underwriting discount or commission
applicable to the securities purchased by such underwriter under the
Registration Statement which resulted in such Losses.  If the allocation provided by the immediately
preceding sentence is unavailable for any reason, the indemnifying party and the
indemnified party shall contribute in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of such
indemnifying party, on the one hand, and such indemnified party, on the other
hand, in connection with the statements or omissions which resulted in such
Losses as well as any other relevant equitable considerations.  Benefits received by the Company and the
Guarantors shall be deemed to be equal to the total net proceeds from the
Initial Placement (before deducting expenses) as set forth in the Final
Memorandum.  Benefits received by the
Initial Purchasers shall be deemed to be equal to the total purchase discounts
and commissions as set forth in the Purchase Agreement, and benefits received
by any other Holders shall be deemed to be equal to 

 

17

 

the
value of receiving Securities or New Securities, as applicable, registered under
the Act.  Benefits received by any
underwriter shall be deemed to be equal to the total underwriting discounts and
commissions, as set forth on the cover page of the Prospectus forming a
part of the Registration Statement which resulted in such Losses.  Relative fault shall be determined by
reference to, among other things, whether any untrue or any alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information provided by the indemnifying party, on the
one hand, or by the indemnified party, on the other hand, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission.  The parties agree that it would not be just
and equitable if contribution were determined by pro rata allocation (even if
the Holders were treated as one entity for such purpose) or any other method of
allocation which does not take account of the equitable considerations referred
to above.  Notwithstanding the provisions
of this paragraph (d), no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.  For purposes of this
Section, each person who controls a Holder within the meaning of either the Act
or the Exchange Act and each director, officer, employee and agent of such
Holder shall have the same rights to contribution as such Holder, and each person
who controls the Company or a Guarantor within the meaning of either the Act or
the Exchange Act, each officer of the Company and the Guarantors who shall have
signed the Registration Statement and each director of the Company and the
Guarantors shall have the same rights to contribution as the Company and the
Guarantors, subject in each case to the applicable terms and conditions of this
paragraph (d).

 

(e)           The provisions of this Section will
remain in full force and effect, regardless of any investigation made by or on
behalf of any Holder or the Company or any of the indemnified persons referred
to in this Section 6, and will survive the sale by a Holder of securities
covered by a Registration Statement.

 

7.             Underwritten Registrations.  (a) If any of the Securities or New
Securities, as the case may be, covered by any Shelf Registration Statement are
to be sold in an underwritten offering, the Managing Underwriters shall be
selected by the Majority Holders and shall be reasonably acceptable to the Company.

 

(b)           No person may participate in any
underwritten offering pursuant to any Shelf Registration Statement, unless such
person (i) agrees to sell such person’s Securities or New Securities, as
the case may be, on the basis reasonably provided in any underwriting
arrangements approved by the persons entitled hereunder to approve such
arrangements; and (ii) completes and executes all questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements.

 

8.             Registration
Defaults.  If:

 

(a)           on or prior to the 180th day
following the date of original issuance of the Securities, neither the Exchange
Offer Registration Statement nor the Shelf Registration Statement has been
filed with the Commission; or

 

18

 

(b)                                 on or prior to the 240th day following
the date of original issuance of the Securities, neither the Exchange Offer
Registration Statement nor the Shelf Registration Statement has been declared
effective; or

 

(c)                                  on or prior to the 45th business day after
the Exchange Offer Registration Statement is declared effective, the Registered
Exchange Offer has not been consummated; or

 

(d)                                 after either the Exchange Offer
Registration Statement or the Shelf Registration Statement has been declared
effective, such Registration Statement thereafter ceases to be effective or
usable (subject to the exceptions contained in this Agreement) in connection
with resales of the Securities or New Securities in accordance with and during
the periods specified in this Agreement;

 

(each such event referred to in clauses (a) through (d), a “Registration
Default”), the Company shall pay liquidated damages (“Registration Default
Damages”) to the Holders of the Securities or New Securities, as the case may
be.  Registration Default Damages shall
accrue at a rate of 0.25% per annum for the first 90 days from and
including the date of a Registration Default (which rate shall be increased by
an additional 0.25% per annum for each subsequent 90-day period that such
Registration Default Damages continue to accrue, provided that the rate
of such Registration Default Damages may in no event exceed 1.00% per
annum) until all such Registration Defaults have been cured; provided, however,
that (1) upon the filing of the Registration Statement (in the case of
paragraph (a) above), (2) upon the effectiveness of the Registration
Statement (in the case of paragraph (b) above), (3) upon the
consummation of the Registered Exchange Offer (in the case of paragraph (c) above),
or (4) upon the effectiveness of the Registration Statement which had
ceased to remain effective (in the case of paragraph (d) above),
Registration Default Damages shall cease to accrue, but only if all Registration Defaults have been cured.  Notwithstanding any provision herein to the
contrary, the amount of Registration Default Damages shall not increase because
more than one of the circumstances described in Section 8(a)-(d) has
occurred and is pending.

 

9.                                       No Inconsistent Agreements. 
The Company has not entered into, and agrees not to enter into, any
agreement with respect to the Securities or the New Securities that is
inconsistent with the rights granted to the Holders herein or that otherwise
conflicts with the provisions hereof.

 

10.                                 Amendments and Waivers. 
The provisions of this Agreement may not be amended, qualified, modified
or supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the Company has obtained the written consent of
the Holders of a majority of the aggregate principal amount of the Registrable
Securities outstanding; provided that, with respect to any matter that
directly or indirectly affects the rights of any Initial Purchaser hereunder,
the Company shall obtain the written consent of each such Initial Purchaser
against which such amendment, qualification, supplement, waiver or consent is
to be effective.  Notwithstanding the
foregoing (except the foregoing provisos), a waiver or consent to departure
from the provisions hereof with respect to a matter that relates exclusively to
the rights of Holders whose Securities or New Securities, as the case may be,
are being sold pursuant to a Registration Statement and that does not directly
or indirectly affect the rights of

 

19

 

other Holders may
be given by the Majority Holders, determined on the basis of Securities or New
Securities, as the case may be, being sold rather than registered under such
Registration Statement.

 

11.                                 Notices.  All notices
and other communications provided for or permitted hereunder shall be made in
writing by hand-delivery, first-class mail, telex, telecopier or air courier
guaranteeing overnight delivery:

 

(a)                                  if to a Holder, at the most current
address given by such holder to the Company in accordance with the provisions
of this Section 11, which address initially is, with respect to each
Holder, the address of such Holder maintained by the Registrar under the
Indenture;

 

(b)                                 if to the Representatives, initially at
the address or addresses set forth in the Purchase Agreement; and

 

(c)                                  if to the Company, initially at its
address set forth in the Purchase Agreement.

 

All such notices and communications shall be deemed
to have been duly given when received.

 

The
Initial Purchasers or the Company by notice to the other parties may designate
additional or different addresses for subsequent notices or communications.

 

12.                                 Remedies.  Each Holder,
in addition to being entitled to exercise all rights provided to it herein, in
the Indenture or in the Purchase Agreement or granted by law, including
recovery of liquidated or other damages, will be entitled to specific
performance of its rights under this Agreement. 
The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agrees to waive in any action for
specific performance the defense that a remedy at law would be adequate.  Notwithstanding the
foregoing, the Registration Default Damages are intended to constitute the sole
monetary damages that a Holder may collect as a result of the occurrence of any
of the conditions described in Sections 8(a) — (d) and any
obligations that result in any such condition, other than the costs and
expenses associated with enforcing their rights thereunder.

 

13.                                 Successors.  This
Agreement shall inure to the benefit of and be binding upon the parties hereto,
their respective successors and assigns, including, without the need for an
express assignment or any consent by the Company thereto, subsequent Holders of
Securities and the New Securities, and the indemnified persons referred to in Section 6
hereof.  The Company hereby agrees to
extend the benefits of this Agreement to any Holder of Securities and the New Securities,
and any such Holder may specifically enforce the provisions of this Agreement
as if an original party hereto.

 

14.                                 Counterparts. 
This Agreement may be signed in one or more counterparts, each of which
shall constitute an original and all of which together shall constitute one and
the same agreement.

 

20

 

15.                                 Headings.  The section
headings used herein are for convenience only and shall not affect the
construction hereof.

 

16.                                 Applicable Law. 
This Agreement shall be governed by and construed in accordance with the
laws of the State of New York applicable to contracts made and to be performed
in the State of New York.  The parties
hereto each hereby waive any right to trial by jury in any action, proceeding
or counterclaim arising out of or relating to this Agreement.

 

17.                                 Severability. 
In the event that any one of more of the provisions contained herein, or
the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions hereof shall not be in any way impaired or affected
thereby, it being intended that all of the rights and privileges of the parties
shall be enforceable to the fullest extent permitted by law.

 

18.                                 Securities Held by the Company, etc. 
Whenever the consent or approval of Holders of a specified percentage of
principal amount of Securities or New Securities is required hereunder,
Securities or New Securities, as applicable, held by the Company or its
Affiliates (other than subsequent Holders of Securities or New Securities if
such subsequent Holders are deemed to be Affiliates solely by reason of their
holdings of such Securities or New Securities) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.

 

21

 

If the foregoing is in accordance with your understanding
of our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between the Company, the Guarantors and the several Initial Purchasers.

 

	
   

  	
  Very truly yours,

  
	
   

  	
  TALECRIS
  BIOTHERAPEUTICS HOLDINGS CORP.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lawrence Stern

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  TALECRIS
  BIOTHERAPEUTICS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lawrence Stern

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  TALECRIS PLASMA
  RESOURCES INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lawrence Stern

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

The foregoing Agreement is hereby confirmed and

accepted as of the date first above written.

 

Morgan Stanley & Co. Incorporated

Citigroup Global Markets Inc.

Goldman, Sachs & Co.

Wells Fargo Securities, LLC

 

For themselves and the other several Initial Purchasers 

named in Schedule I to the Purchase Agreement.

 

	
  By:

  	
  Morgan
  Stanley & Co. Incorporated

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Peter Zippelius

  	
   

  
	
   

  	
  Name: Peter Zippelius

  	
   

  
	
   

  	
  Title: Vice President

  	
   

  

 

[Signature Page to
Registration Rights Agreement]

 

 

ANNEX A

 

Each broker-dealer that receives new securities for
its own account pursuant to the Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such new securities.  The Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an “underwriter” within the meaning of the Act.  This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of new securities received in exchange for securities where such
securities were acquired by such broker-dealer as a result of market-making
activities or other trading activities. 
The company has agreed that, starting on the expiration date and ending
on the earlier of (i) the 90th day following
the expiration date (or such longer period extended on a day-for-day basis if
the company restricts the use of the prospectus during such period) and (ii) such
time as no broker-dealer holds any new securities resale of which requires
compliance with the prospectus delivery requirements of the Act, it will make
this prospectus available to any broker-dealer for use in connection with any
such resale. See “Plan of Distribution”.

 

A-1

 

ANNEX B

 

Each broker-dealer that receives new securities for
its own account in exchange for securities, where such securities were acquired
by such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such new securities. 
See “Plan of Distribution”.

 

B-1

 

ANNEX C

PLAN OF DISTRIBUTION

 

Each broker-dealer that receives new securities for
its own account pursuant to the Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such new securities.  This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of new securities received in exchange for securities where such
securities were acquired as a result of market-making activities or other
trading activities.  The company has
agreed that, starting on the expiration date and ending on the earlier of (i) the
90th day following the expiration date (or such
longer period extended on a day-for-day basis if the company restricts the use
of the prospectus during such period) and (ii) such time as no
broker-dealer holds any new securities resale of which requires compliance with
the prospectus delivery requirements of the Act (such period, “Exchange Offer
Registration Period”), it will make this prospectus, as amended or
supplemented, available to any broker-dealer for use in connection with any
such resale.  In addition, until                     ,
                    ,
all dealers effecting transactions in the new securities may be required to
deliver a prospectus.

 

The
company will not receive any proceeds from any sale of new securities by
brokers-dealers.  New securities received
by broker-dealers for their own account pursuant to the Exchange Offer may be
sold from time to time in one or more transactions in the over-the-counter
market, in negotiated transactions, through the writing of options on the new
securities or a combination of such methods of resale, at market prices
prevailing at the time of resale, at prices related to such prevailing market
prices or negotiated prices.  Any such
resale may be made directly to purchasers or to or through brokers or dealers
who may receive compensation in the form of commissions or concessions from any
such broker-dealer and/or the purchasers of any such new securities.  Any broker-dealer that resells new securities
that were received by it for its own account pursuant to the Exchange Offer and
any broker or dealer that participates in a distribution of such new securities
may be deemed to be an “underwriter” within the meaning of the Act and any
profit of any such resale of new securities and any commissions or concessions
received by any such persons may be deemed to be underwriting compensation
under the Act.  The Letter of Transmittal
states that by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter”
within the meaning of the Act.

 

During
the Exchange Offer Registration Period, the company will promptly send additional copies of
this prospectus and any amendment or supplement to this prospectus to any
broker-dealer that requests such documents in the Letter of Transmittal.  The company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
holder of the securities) other than commissions or concessions of any brokers
or dealers and will indemnify the holders of the securities (including any
broker-dealers) against certain liabilities, including liabilities under the
Act.

 

[If applicable, add information required by Regulation
S-K Items 507 and/or 508.]

 

C-1

 

ANNEX D

 

Rider A

 

PLEASE FILL IN YOUR NAME AND ADDRESS BELOW IF YOU ARE A BROKER-DEALER
AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.

 

	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

Rider B

 

If the undersigned is not a Broker-Dealer, the undersigned represents
that it acquired the New Securities in the ordinary course of its business, it
is not engaged in, and does not intend to engage in, a distribution of New
Securities and it has no arrangements or understandings with any person to
participate in a distribution of the New Securities.  If the undersigned is a Broker-Dealer that
will receive New Securities for its own account in exchange for Securities, it
represents that the Securities to be exchange for New Securities were acquired
by it as a result of market-making activities or other trading activities and
acknowledges that it will deliver a prospectus in connection with any resale of
such New Securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an “underwriter”
within the meaning of the Act.

 

D-1

 

SCHEDULE A

 

Guarantors:

 

TALECRIS BIOTHERAPEUTICS, INC.

 

TALECRIS PLASMA RESOURCES INC.

 

A-1October 21, 2009 8K Exhibit 10.1

Exhibit 10.1
 

SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this "Agreement") is dated as of October15, 2009,
between Zoom Technologies, Inc., a Delaware corporation (the "Company"), and each purchaser identified on the
signature pages hereto (each, including its successors and assigns, a "Purchaser" and collectively, the
"Purchasers").

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(2) of the
Securities Act of 1933, as amended (the "Securities Act"), and Rule 506 promulgated thereunder, the Company desires
to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the
Company as more fully described in this Agreement.

NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and each Purchaser agree as
follows:

ARTICLE I. 

                      DEFINITIONS

1.1   Definitions.  The following terms have the meanings set forth in this Section 1.1:

"8-K Filing" shall mean the current report on Form 8-K filed on EDGAR with the Commission
disclosing the sale of equity securities pursuant to this Agreement and attaching as exhibits thereto all material Transaction Documents,
including, without limitation, this Agreement, the form of Series A & C Warrant, the form of Series B Warrant, the form of Series D &
E Warrant, the Voting Agreement and the form of Lock-Up Agreement.

"Acquiring Person" shall have the meaning ascribed to such term in Section 4.6.

"Action" shall have the meaning ascribed to such term in Section 3.1(j).

"Affiliate" means any Person that, directly or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the
Securities Act.  

"Available Undersubscribed Amount" have the meaning ascribed to it in Section 4.11(c). 

"Basic Amount" have the meaning ascribed to it in Section 4.11(c).

"Board of Directors" means the board of directors of the Company.

"Business Day" means any day except any Saturday, any Sunday, any day which is a federal
legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other
governmental action to close.

"Bylaws" shall have the meaning ascribed to it in Section 3.1(h).

"Certificate of Incorporation" shall have the meaning ascribed to it in Section 3.1(h).

"Closing" means the closing of the purchase and sale of the Securities pursuant to Section
2.1.

"Closing Date" means the Trading Day on which all of the Transaction Documents have been
executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers' obligations to pay the
Subscription Amount and (ii) the Company's obligations to deliver the Securities, in each case, have been satisfied or waived.

"Closing Statement" means the Closing Statement in the form on Annex A attached
hereto.

"Commission" means the United States Securities and Exchange Commission.

"Common Stock" means the common stock of the Company, par value $0.01 per share, and any
other class of securities into which such securities may hereafter be reclassified or changed.

"Company Counsel" means Ellenoff Grossman & Schole LLP, with offices located at 150
East 42nd Street, New York, New York 10017.

"Contingent Obligation" means, as to any Person, any direct or indirect liability, contingent or otherwise, of
that Person with respect to any indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the
Person incurring such liability, or the primary effect thereof, is to provide assurance to the obligee of such liability that such liability will be paid
or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or
in part) against loss with respect thereto;

"Disclosure Schedules" shall have the meaning ascribed to such term in Section 3.1.

"Effective Date" shall have the meaning ascribed to such term in the Registration Rights
Agreement.

"Escrow Agent" means Sichenzia Ross Friedman Ference LLP, with offices located at 61
Broadway, New York, New York 10006.

                              2

"Escrow Agreement" means the escrow agreement entered into prior to the date hereof, by and
among the Company and the Escrow Agent in substantially the form of Exhibit J attached hereto pursuant to which the Purchasers,
shall deposit Subscription Amounts with the Escrow Agent to be applied to the transactions contemplated hereunder.

"Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.

"GAAP" shall have the meaning ascribed to such term in Section 3.1(i).

"Indebtedness" of any Person means, without duplication (A) all indebtedness for borrowed money, (B) all
obligations issued, undertaken or assumed as the deferred purchase price of property or services (including, without limitation, "capital
leases" in accordance with generally accepted accounting principles) (other than trade payables entered into in the ordinary course of
business), (C) all reimbursement or payment obligations with respect to letters of credit, surety bonds and other similar instruments, (D) all
obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the
acquisition of property, assets or businesses, (E) all indebtedness created or arising under any conditional sale or other title retention
agreement, or incurred as financing, in either case with respect to any property or assets acquired with the proceeds of such indebtedness
(even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of
such property), (F) all monetary obligations under any leasing or similar arrangement which, in connection with generally accepted accounting
principles, consistently applied for the periods covered thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A)
through (F) above secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by)
any mortgage, lien, pledge, charge, security interest or other encumbrance upon or in any property or assets (including accounts and contract
rights) owned by any Person, even though the Person which owns such assets or property has not assumed or become liable for the
payment of such indebtedness, and (H) all Contingent Obligations in respect of indebtedness or obligations of others of the kinds referred to
in clauses (A) through (G) above.

"Intellectual Property Rights" shall have the meaning ascribed to such term in Section
3.1(w).

"Legend Removal Date" shall have the meaning ascribed to such term in Section 4.1(c). 

"Liens" means a lien, charge, security interest, encumbrance, right of first refusal, preemptive
right or other restriction. 

                              3

"Lock-Up Agreement" means the Lock-Up Agreement, dated as of the date hereof, by and
among the Company and the directors, officers and certain affiliates of the Company in the form of Exhibit E attached hereto.

"Material Adverse Effect" shall mean (i) a material adverse effect on the legality, validity or
enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or
condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company's
ability to perform in any material respect on a timely basis its obligations under any Transaction Document.

"Material Permits" shall have the meaning ascribed to such term in Section 3.1(k).

"Notice of Acceptance" have the meaning ascribed to it in Section 4.11(c). 

"Offer" shall have the meaning ascribed to it in Section 4.11(c).

"Offer Notice" shall have the meaning ascribed to it in Section 4.11(c).

"Offer Period" have the meaning ascribed to it in Section 4.11(c).

"Offered Securities" have the meaning ascribed to it in Section 4.11(c).

"Person" means an individual or corporation, partnership, trust, incorporated or unincorporated
association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of
any kind.

"Proceeding" means an action, claim, suit, investigation or proceeding (including, without
limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

"Public Information Failure" shall have the meaning ascribed to it in Section 4.2(b).

"Public Information Failure Payments" shall have the meaning ascribed to it in Section
4.2(b).

"Refused Securities" shall have the meaning ascribed to it in Section 4.11(c).

"Registration Rights Agreement" means the Registration Rights Agreement, dated the date
hereof, among the Company and the Purchasers, in the form of Exhibit A attached hereto.

"Registration Statement" means a registration statement meeting the requirements set forth in
the Registration Rights Agreement and covering the resale of the Warrant Shares by each Purchaser as provided for in the Registration
Rights Agreement.

"Required Approvals" shall have the meaning ascribed to such term in Section 3.1(f).

                              4

"Required Minimum" means, as of any date, the maximum aggregate number of Shares then
issued or potentially issuable in the future pursuant to the Transaction Documents, including, without limitation, 130% of the shares of
Common Stock underlying the Series A and Series C Warrants and 100% of the Shares, the shares of Common Stock underlying the Series
B, D and E Warrants, ignoring any conversion or exercise limits set forth therein.

"Rule 144" means Rule 144 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the
same effect as such Rule.

"Rule 424" means Rule 424 promulgated by the Commission pursuant to the Securities Act, as
such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having
substantially the same purpose and effect as such Rule.

"SEC Reports" shall have the meaning ascribed to such term in Section 3.1(i).

"Securities" means the Shares, the Warrants, and the Warrant Shares.

"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.

"Series A Warrants" means the Series A Common Stock purchase warrants delivered to the
Purchasers at the Closing in accordance with Section 2.2(a) hereof, which warrants shall be exercisable as of the Issue Date (as defined
therein), subject to the Exchange Cap (as defined therein) limitation.  The Series A Warrants shall have an exercise price of $6.00 and a term
of exercise equal to 5 years from the Issue Date, in the form of Exhibit B attached hereto.

"Series B Warrants" means the Series B Common Stock purchase warrants delivered to the
Purchasers at the Closing in accordance with Section 2.2(a) hereof, which warrants shall be exercisable only upon obtaining the Required
Approvals (as defined therein).  The Series B Warrants shall have an exercise price of $0.01 and a term of exercise equal to three(3) months
from the Issue Date (as defined therein) provided, however, that such date shall be extended indefinitely if the Warrant
cannot be exercised due to the Beneficial Ownership Limitation (as defined therein) or the Exchange Cap (as defined therein) limitation until
the Warrant can be exercised in full by the holder thereof without breaching the Beneficial Ownership Limitation or the Exchange Cap
limitation, in the form of Exhibit C attached hereto.

                              5

"Series C Warrants" means the Series C Common Stock purchase warrants delivered to the
Purchasers at the Closing in accordance with Section 2.2(a) hereof, which warrants shall be exercisable only upon the exercise of the Series
B Warrants.  The Series C Warrants shall have an exercise price of $6.00 and a term of exercise equal to 5 years from the Issue Date (as
defined therein), in the form of Exhibit B attached hereto.

"Series D Warrants" means the Series D Common Stock purchase warrants delivered to the
Purchasers at the Closing in accordance with Section 2.2(a) hereof, which warrants shall be exercisable based upon the achievement of
certain performance criteria.  The Series D Warrant shall have an exercise price of $0.01 and a term of exercise equal to three (3) months
from the date the Maximum Eligibility Date (as defined therein) is increased; provided, however, that such date shall be
extended indefinitely if the Warrant cannot be exercised due to the Beneficial Ownership Limitation (as defined therein) or the Exchange Cap
(as defined therein) until the Warrant can be exercised in full by the holder thereof without breaching the Beneficial Ownership Limitation or
the Exchange Cap limitation, in the form of Exhibit D attached hereto.

"Series E Warrants" means the Series E Common Stock purchase warrants delivered to the
Purchasers at the Closing in accordance with Section 2.2(a) hereof, which warrants shall be exercisable based upon the achievement of
certain performance criteria.  The Series E Warrants shall have an exercise price of $0.01 and a term of exercise equal to three (3) months
from the date the Maximum Eligibility Date (as defined therein) is increased; provided, however, that such date shall be
extended indefinitely if the Warrant cannot be exercised due to the Beneficial Ownership Limitation (as defined therein) until the Warrant can
be exercised in full by the holder thereof without breaching the Beneficial Ownership Limitation, in the form of Exhibit D
attached hereto.

"Shares" means the shares of Common Stock issued or issuable to each Purchaser pursuant to
this Agreement.

"Shareholder Approval" means such approval as may be required by the applicable rules and
regulations of the Nasdaq Capital Market (or any successor entity) from the shareholders of the Company with respect to the transactions
contemplated by the Transaction Documents, including the issuance of any Shares in excess of 19.9% of the issued and outstanding
Common Stock on the Closing Date.

"Short Sales" means all "short sales" as defined in Rule 200 of Regulation SHO under
the Exchange Act (but shall not be deemed to include the location and/or reservation of borrowable shares of Common Stock). 

"Stockholder Approval" shall have the meaning ascribed to it in Section 3.1(a).

"Subscription Amount" means, as to each Purchaser, the aggregate amount to be paid for Shares and Warrants purchased hereunder as specified below such Purchaser's name on the
signature page of this Agreement and next to the heading "Subscription Amount," in United States dollars and in immediately
available funds.

                                     6

"Subsequent Placement" shall have the meaning ascribed to it in Section 4.11(c).

"Subsequent Placement Agreement" shall have the meaning ascribed to it in Section
4.11(c).

"Subsequent Placement Documents" shall have the meaning ascribed to it in Section
4.11(c).

"Subsidiary" means any subsidiary of the Company as set forth on Schedule 3.1(b) and
shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

"Trading Day" means a day on which the principal Trading Market is open for trading.

"Trading Market" means any of the following markets or exchanges on which the Common Stock
is listed or quoted for trading on the date in question: the NYSE Alternext, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq
Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).

"Transaction Documents" means this Agreement, the Placement Agent Agreement, the
Warrants, the Registration Rights Agreement, the Escrow Agreement, the Voting Agreement, the Lock-Up Agreements, all exhibits and
schedules thereto and hereto and any other documents or agreements executed in connection with the transactions contemplated
hereunder.

"Transfer Agent" means Computershare Stock Transfer, the current transfer agent of the
Company, with a mailing address of 1745 Gardena Avenue, Glendale CA 91204, and any successor transfer agent of the Company.

"Trigger Date" shall have the meaning ascribed to it in Section 4.1(b).

"Undersubscribed Amount" have the meaning ascribed to it in Section 4.1(c).

"Warrants" means, collectively, the Series A Warrants, the Series B Warrants, the Series C
Warrants, the Series D Warrants and the Series E Warrants.

"Warrant Shares" means the shares of Common Stock issuable upon exercise of the
Warrants.

                              7

ARTICLE II. 

                  PURCHASE AND SALE

2.1   Closing.  On the Closing Date, upon the terms and subject to the conditions set forth herein,
substantially concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the
Purchasers, severally and not jointly, agree to purchase, up to an aggregate of 1,241,924 Shares at a per share purchase price equal to
$4.00 per share and 1,259,326 Series B Warrants at a purchase price equal to $4.00 per Series B Warrant.  For every Share subscribed by
each Purchaser, such number of Series A, B, C, D and E Warrants as set forth in Section 2.2(a) below. Each Purchaser shall deliver to the
Escrow Agent via wire transfer or a certified check of immediately available funds equal to such Purchaser's Subscription Amount as set forth
on the signature page hereto executed by such Purchaser and the Company shall deliver to each Purchaser its respective Common Stock
and Warrants as determined pursuant to Section 2.2(a), and the Company and each Purchaser shall deliver the other items set forth in
Section 2.2 deliverable at the Closing. In lieu of delivering such funds to the Escrow Agent, Purchaser may deliver such funds at the Closing
to the Company via wire transfer or a certified check of immediate available funds.  Upon satisfaction of the covenants and conditions set
forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of Schulte Roth & Zabel LLP at 919 Third Avenue, New York, New
York 10022 or such other location as the parties shall mutually agree and the Subscription Amount shall be released from Escrow to the
account of the Company in accordance with the terms of the Escrow Agreement.

2.2   Deliveries.

	On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the
following:

	this Agreement duly executed by the Company;

	legal opinions of U.S., PRC, Hong Kong Counsel, as well as the Good Standing Certificate of the BVI Company,
substantially in the forms of, substantially in the forms of Exhibit G, Exhibit H, Exhibit I, and Exhibit J respectively,
attached hereto; 

	a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver, on an
expedited basis, a certificate evidencing a number of Shares equal to such Purchaser's Subscription Amount divided by the per share
purchase price of $4.00 per share, registered in the name of such Purchaser;

	such number of Series A, B, C, D and E Warrants as set forth opposite such Purchaser's name in the Schedule A
hereto.

	the Placement Agent Agreement, duly executed by the Company; 

	the Registration Rights Agreement duly executed by the Company; 

	the Escrow Agreement, duly executed by the Company; 

                              8

	the Voting Agreement, duly executed by Mr. Lei Gu and Mr. Cao Wei, stockholders of the Company or other
stockholders of the Company representing a minimum of 63% of the voting capital of the Company prior issuance of the Securities pursuant
to this Agreement;.

	the Lock-Up Agreement executed by Mr. Lei Gu; and

	 the Lock-Up Agreement executed by Mr. Cao Wei.

	On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the
following: 

	this Agreement duly executed by such Purchaser;

	such Purchaser's Subscription Amount by wire transfer to the account as specified in writing by the Company;

	the Registration Rights Agreement, duly executed by such Purchaser;

	the Escrow Agreement, duly executed by such Purchaser; and

	the Purchaser Questionnaire in the form on Annex B attached hereto.

2.3   Reverse Merger Transaction.  The parties acknowledge prior to the consummation of the
transactions contemplated by this Agreement, the Company completed a share exchange for all the issued and outstanding shares of Gold
Lion Holding Limited, a company organized in the British Virgin Islands (the "BVI") ("Gold Lion"),
pursuant to that certain Share Exchange Agreement dated as of January 28, 2009 (and amended May 12, 2009) by and among the
Company, Gold Lion, Tianjin Tong Guang Group Digital Communication Co., Ltd., a company organized under the laws of the People's
Republic of China ("TCB Digital"), Zoom Telephonics, Inc., Lei (Leo) Gu, a citizen of the PRC; and (6) Cao Wei, a citizen
of the PRC. Upon the consummation of the share exchange, Gold Lion became a wholly-owned subsidiary of the Company (the
"Reverse Merger Transaction").

2.4   Closing Conditions. 

	The obligations of the Company hereunder in connection with the Closing are subject to the following conditions
being met:

	the accuracy in all material respects on the Closing Date of the representations and warranties of the Purchasers
contained herein (unless as of a specific date therein);

                              9

	all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing
Date shall have been performed; and

	the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.

	The respective obligations of the Purchasers hereunder in connection with the Closing are subject to the
following conditions being met:

	the accuracy in all material respects (except that any representation and warranty that is qualified as to
"materiality" or "Material Adverse Effect" shall be true and correct in all respects) when made and on the Closing Date of the
representations and warranties of the Company contained herein (except for those which by their terms specifically refer to an earlier date, in
which case such representations and warranties shall have been true and correct in all material respects (except that any representation and
warranty that is qualified as to "materiality" or "Material Adverse Effect" shall be true and correct in all respects) as of such earlier
date);

	all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing
Date shall have been performed; 

	the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement; 

	there shall have been no Material Adverse Effect with respect to the Company since the date hereof; 

	as of the Closing Date, the NASDAQ Capital Market shall have approved the continued listing of the Common
Stock of the Company, the additional listing application with respect to the Shares and, subject to Stockholder Approval, the additional listing
application with respect to the Warrant Shares; and

	from the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the
Commission or the Company's principal Trading Market (except for any suspension of trading of limited duration agreed to by the Company,
which suspension shall be terminated prior to the Closing).

ARTICLE III. 

                  REPRESENTATIONS, WARRANTIES AND COVENANTS

3.1   Representations and Warranties of the Company.  Except as set forth in the Disclosure Schedules,
which Disclosure Schedules shall be deemed a part hereof and shall

                              10

qualify any representation or otherwise made herein to the extent of the
disclosure contained in the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and
warranties to each Purchaser:

	Approval of Issuance of Securities.  The Company covenants to (i) hold a special meeting of
shareholders to approve at the earliest practical date following the date hereof to approve the issuance and/or potential issuance of common
stock equal to 19.99 percent or more of the Company's issued and outstanding common stock pursuant to NASDAQ rules and regulations
(the "Stockholder Approval"); (ii) file the required notification with NASDAQ regarding the issuance and/or potential issuance of
common stock equal to 19.99 percent or more of the Company's issued and outstanding common stock pursuant to NASDAQ rules and
regulations and (iii) file a proxy statement on Schedule 14A soliciting the vote from the Company's shareholders to approve the issuance of
the Warrant  Shares and to remove any restrictions on exercise of the Warrants with respect to the Exchange Cap (as defined therein), within
45 days of the date hereof.  The Company covenants to use its best efforts to obtain SEC clearance on the proxy statement on Schedule 14A
as soon as practicable, and the Company further covenants to hold such special meeting of shareholders as soon as practicable, but in no
event later than December 1, 2009.

	Subsidiaries.  All of the direct and indirect subsidiaries of the Company are set forth on Schedule
3.1(b).  The Company owns, directly or indirectly, such percentage of the Subsidiary as set forth in Schedule 3.1(b) and such
ownership interest is free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly
issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.  If the Company
has no subsidiaries, all other references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded. Other than as contemplated by the Transaction Documents, there are no outstanding preemptive, conversion or other
rights, options, warrants or agreements granted or issued by or binding upon any subsidiary for the purchase or acquisition of any shares of
capital stock of any subsidiary or any other securities convertible into, exchangeable for or evidencing the rights to subscribe for any shares
of such capital stock that would have a dilutive effect on the Company's ownership of its subsidiaries. Other than as contemplated by the
Transaction Documents, neither the Company nor any subsidiary is subject to any obligation (contingent or otherwise) to repurchase or
otherwise acquire or retire any shares of the capital stock of any subsidiary or any convertible securities, rights, warrants or options of the
type described in the preceding sentence. Neither the Company nor any subsidiary is party to, nor has any knowledge of, any agreement
restricting the voting or transfer of any shares of the capital stock of any subsidiary.

	Organization and Qualification.  The Company and each of the Subsidiaries is an entity duly
incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or
organization, with

                              11

the requisite power and authority to own and use its properties and assets and to carry on its business as currently
conducted.  Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation
or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary,
except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in a
Material Adverse Effect and no Proceeding has been initiated in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit
or curtail such power and authority or qualification.

	Authorization; Enforcement.  The Company has the requisite corporate power and authority to enter into
and to consummate the transactions contemplated by each of the Transaction Documents and otherwise to carry out its obligations
hereunder and thereunder.  The execution and delivery of each of the Transaction Documents by the Company and the consummation by it
of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no
further action is required by the Company, the Board of Directors or the Company's stockholders in connection therewith other than in
connection with the Required Approvals.  Each Transaction Document to which it is a party has been (or upon delivery will have been) duly
executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding
obligation of the Company enforceable against the Company in accordance with its terms, except: (i) as limited by general equitable
principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of
creditors' rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies
and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.  

	No Conflicts.  The execution, delivery and performance by the Company of the Transaction Documents,
the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby to which it is a party
do not and will not: (i) conflict with or violate any provision of the Company's or any Subsidiary's certificate or articles of incorporation, bylaws
or other organizational or charter documents, (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both
would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or
give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any
agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which
the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii)
subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws
and regulations), or by which any property or asset of the Company or a Subsidiary is

                              12

bound or affected; except in the case of each of
clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.

	Filings, Consents and Approvals.  The Company is not required to obtain any consent, waiver,
authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other
governmental authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction
Documents, other than: (i) the filings required pursuant to Section 4.5 of this Agreement, (ii) the filing with the Commission pursuant to the
Registration Rights Agreement, (iii) the notice and/or application(s) to each applicable Trading Market for the issuance and sale of the
Shares, Warrants and Warrant Shares and the listing of the Shares and Warrant Shares for trading thereon in the time and manner required
thereby, (iv) the filing of Form D with the Commission and such filings as are required to be made under applicable state securities laws and
(v) any Shareholder Approval, if required, (collectively, the "Required Approvals").

	Issuance of the Securities.  The Shares and Warrants are duly authorized and, when issued and paid
for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of
all Liens other than restrictions on transfer provided for in the Transaction Documents.  The Warrant Shares, when duly issued and when
issuance of such is authorized by the stockholders of the Company, will be duly authorized and,
when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and
nonassessable, free and clear of all Liens other than restrictions on transfer provided for in the Transaction Documents.  The Company has
reserved from its duly authorized capital stock a number of shares of Common Stock for issuance of the Warrant Shares at least equal to the
Required Minimum on the date hereof.  

	Capitalization.  The capitalization of the Company is as set forth on Schedule 3.1(h), which
Schedule 3.1(h) shall also include the number of shares of Common Stock owned beneficially, and of record, by Affiliates of the
Company as of the date hereof. All of such outstanding shares have been, or upon issuance will be, validly issued and are fully paid and
nonassessable.  Except as disclosed in Schedule 3(h): (i) none of the Company's capital stock is subject to preemptive
rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company; (ii) 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, or exercisable or exchangeable for, 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, or exercisable or exchangeable for, any shares of capital stock of the
Company or any of its Subsidiaries; (iii) there are no outstanding debt securities, notes, credit agreements, credit facilities or other
agreements, documents or

                              13

instruments evidencing Indebtedness of the Company or any of its Subsidiaries which are convertible into or
exchangeable for any shares of capital stock of the Company; (iv) there are no outstanding securities or instruments of the Company or
any of its Subsidiaries which contain any redemption or similar provisions and other agreements consistent with past practices), and there are
no contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to
redeem a security of the Company or any of its Subsidiaries; (v) there are no securities or instruments containing anti-dilution or similar
provisions that will be triggered by the issuance of the Securities; (vi) the Company does not have any stock appreciation rights or
"phantom stock" plans or agreements or any similar plan or agreement; and (vii) there are no financing statements securing
obligations in any material amounts, either singly or in the aggregate, filed in connection with the Company or any of its Subsidiaries; (viii)
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 Securities Act (except pursuant to the Registration Rights Agreement); and (ix) the Company and its Subsidiaries have
no liabilities or obligations required to be disclosed in the SEC Reports but not so disclosed in the SEC Reports, other than those incurred in
the ordinary course of the Company's or its Subsidiaries' respective businesses and which, individually or in the aggregate, do not or would
not have a Material Adverse Effect.  The Company has made available to the Purchasers true, correct and complete 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 Bylaws, as amended and as in effect on the date hereof (the "Bylaws"),
and the terms of all securities convertible into, or exercisable or exchangeable for, shares of Common Stock and the material rights of the
holders thereof in respect thereto.  No Person has any right of first refusal, preemptive right, right of participation, or any similar right to
participate in the transactions contemplated by the Transaction Documents.  The issuance and sale of the Securities will not obligate the
Company to issue shares of Common Stock or other securities to any Person (other than the Purchasers) and will not result in a right of any
holder of Company securities to adjust the exercise, conversion, exchange or reset price under any of such securities. No further approval or
authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Securities.  

	SEC Reports; Financial Statements.  Except as set forth on Schedule 3.1 (i), the Company has
filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the twelve months preceding the date hereof (or such shorter period
as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to herein as the "SEC Reports") or has received a valid
extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension.  Except as set forth on
Schedule 3.1(i), as of their respective filing dates, the SEC Reports complied in all material respects with the requirements of the
Securities Act and the Exchange Act, as

                              14

applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material
fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.  Except as set forth on Schedule 3.1(i), the financial statements of the
Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing.  Such financial statements have been prepared in accordance with
United States generally accepted accounting principles applied on a consistent basis during the periods involved
("GAAP"), except as may be otherwise specified in such financial statements or the notes thereto and except that
unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial
position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the
periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments 

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

	Regulatory Permits.  The Company and the Subsidiaries possess all certificates, authorizations and
permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as
currently conducted, except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect
("Material Permits"), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the
revocation or modification of any Material Permit.

	Private Placement.  Assuming the accuracy of the Purchasers' representations and warranties set forth
in Section 3.2, no registration under the Securities Act is required for the offer and sale of the Securities by the Company to the Purchasers
as contemplated hereby. Upon approval of the Company's stockholder, the issuance and

                              15

sale of the Securities hereunder does not contravene the rules and regulations of the Trading Market.

	Listing and Maintenance Requirements.
The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to,
or which to its knowledge is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act nor has the
Company received any notification that the Commission is contemplating terminating such registration.  The Company has not, from
September 10, 2009, the date of the Trading Market's letter approving the Company's continued listing on such Trading Market, and until the
date hereof, received notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the
Company is not in compliance with the listing or maintenance requirements of such Trading Market. The Company is unaware of any facts or
circumstances that could reasonably be expected to cause failure to maintain the continued listing of the Common Stock on the Trading
Market.  

	Disclosure.  Except with respect to the material terms and conditions of the transactions contemplated
by the Transaction Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the
Purchasers or their agents or counsel with any information that it believes constitutes or might constitute material, non-public information.
The Company understands and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of
the Company.  All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company, its business and the
transactions contemplated hereby, including the Disclosure Schedules to this Agreement, is true and correct and does not contain any untrue
statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading.   

	No Integrated Offering. Assuming the accuracy of the Purchasers' representations and
warranties set forth in Section 3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this
offering of the Securities to be integrated with prior offerings by the Company for purposes of (i) the Securities Act which would require the
registration of any such securities under the Securities Act, or (ii) any applicable shareholder approval provisions of any Trading Market on
which any of the securities of the Company are listed or designated. 

	No General Solicitation. Neither the Company nor any person acting on behalf of the Company has offered
or sold any of the Securities by any form of general solicitation or general advertising.  The Company has offered the Securities for sale only
to the Purchasers and certain other "accredited investors" within the meaning of Rule 501 under the Securities Act.

                              16

	Acknowledgment Regarding Purchasers' Purchase of Securities.  The Company acknowledges and
agrees that each of the Purchasers is acting solely in the capacity of an arm's length purchaser with respect to the Transaction Documents
and the transactions contemplated thereby.  The Company further acknowledges that no Purchaser is acting as a financial advisor or
fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby
and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents
and the transactions contemplated thereby is merely incidental to the Purchasers' purchase of the Securities.  The Company further
represents to each Purchaser that the Company's decision to enter into this Agreement and the other Transaction Documents has been
based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

	Regulation M Compliance.  The Company has not, and no one acting on its behalf has, (i) taken,
directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or paid any compensation for soliciting purchases of, any of
the Securities, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the
Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Company's placement agent in connection with the
placement of the Securities.

	Material Changes; Undisclosed Events, Liabilities or Developments.  Since the date of the latest audited
financial statements included within the SEC Reports, except as set forth on Schedule 3.1(s) or as specifically disclosed in a
subsequent SEC Report filed prior to the date hereof: (i) there has been no event, occurrence or development that has had or that could
reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other
than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not
required to be reflected in the Company's financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the
Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other
property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v)
the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans.
The Company does not have pending before the Commission any request for confidential treatment of information.  Except for the issuance
of the Securities contemplated by this Agreement (i), no event, liability or development has occurred or exists with respect to the
Company or its Subsidiaries or their respective business, properties, operations or financial condition, that would be required to be disclosed
by the Company under applicable securities laws at the time this representation is made or

                              17

deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is made.

	Labor Relations.  No material labor dispute exists or, to the knowledge of the Company, is imminent with
respect to any of the employees of the Company which could reasonably be expected to result in a Material Adverse Effect.  None of the
Company's or its Subsidiaries' employees is a member of a union that relates to such employee's relationship with the Company or such
Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its
Subsidiaries believe that their relationships with their employees are good.  No executive officer, to the knowledge of the Company, is, or is
now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information
agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the
continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to
any of the foregoing matters.  The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and
regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the
failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

	Compliance.  Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no
event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any
Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any
indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is in violation of any order of any court, arbitrator or governmental body or (iii)
is or has been in violation of any statute, rule or regulation of any governmental authority, including without limitation all foreign, federal, state
and local laws applicable to its business and all such laws that affect the environment, except in each case as could not have or reasonably
be expected to result in a Material Adverse Effect.

	Title to Assets.  The Company and the Subsidiaries have valid land-use rights to all real property
granted to them by the PRC government and good and marketable title in all personal property owned by them that is material to the
business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for Liens as do not materially affect the value
of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the
Subsidiaries and Liens for the payment of federal, state or other taxes, the payment of which is neither delinquent nor subject to penalties.
Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under

                              18

valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

	Patents and Trademarks.  The Company and the Subsidiaries have, or have rights to use, all patents,
patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other
intellectual property rights and similar rights as described in the SEC Reports as necessary or material for use in connection with their
respective businesses and which the failure to so have could have a Material Adverse Effect (collectively, the "Intellectual Property
Rights").  Neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of the Intellectual Property
Rights used by the Company or any Subsidiary violates or infringes upon the rights of any Person.  To the knowledge of the Company, all
such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property
Rights.  The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of
their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.

	Insurance.  Except as set forth on Schedule 3.1(x), 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 any reason to believe that it will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that would
not have a Material Adverse Effect.  

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

	Sarbanes-Oxley; Internal Accounting Controls.  Within 30 days from the date hereof, the Company
covenants to engage Sarbanes-Oxley compliance consultants

                              19

and the Company further covenants to comply with the Sarbanes-Oxley Act of
2002 at such time as required by the Securities and Exchange Commission.  

	Certain Fees.  Except as set forth in Schedule 3.1(aa), no brokerage or finder's fees or
commissions are or will be payable by the Company to any broker, financial advisor or consultant, finder, placement agent, investment
banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents.  The Purchasers shall have no
obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this
Section that may be due in connection with the transactions contemplated by the Transaction Documents.

	Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of
payment for the Securities, will not be or be an Affiliate of, an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.  The Company shall conduct its business in a manner so that it will not become subject to the Investment
Company Act of 1940, as amended.

	Shell Company Status. The Company is not, and has never been, an issuer identified in
Rule 144(i)(1).

	Registration Rights.  Except as set forth in Schedule 3.1(dd), no Person has any right to cause
the Company to effect the registration under the Securities Act of any securities of the Company.

	Application of Takeover Protections.  The Company and the Board of Directors have taken all necessary
action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under the Company's certificate of incorporation (or similar charter documents) or
the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers and the Company
fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation as a result of the Company's
issuance of the Securities and the Purchasers' ownership of the Securities.

	Solvency.  Based on the consolidated financial condition of the Company as of the Closing Date, after
giving effect to the receipt by the Company of the proceeds from the sale of the Securities hereunder: (i) the fair saleable value of the
Company's assets exceeds the amount that will be required to be paid on or in respect of the Company's existing debts and other liabilities
(including known contingent liabilities) as they mature, (ii) the Company's assets do not constitute unreasonably small capital to carry on its
business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital
requirements of the business conducted by the Company, and projected capital requirements and capital availability thereof, and (iii) the
current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all

                              20

anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are
required to be paid.  The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the
timing and amounts of cash to be payable on or in respect of its debt).  The Company has no knowledge of any facts or circumstances which
lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year
from the Closing Date.  Schedule 3.1(ff) sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the
Company or any Subsidiary, or for which the Company or any Subsidiary has commitments.

	Tax Returns.  Except for matters that would not, individually or in the aggregate, have or reasonably be
expected to result in a Material Adverse Effect, the Company and each Subsidiary has filed all necessary federal, state and foreign income
and franchise tax returns and has paid or accrued all taxes shown as due thereon, and the Company has no knowledge of a tax deficiency
which has been asserted or threatened against the Company or any Subsidiary.

	Foreign Corrupt Practices.  Neither the Company, nor to the knowledge of the Company, any agent or
other person acting on behalf of the Company, has: (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or
other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government
officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any
contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is in violation of law or
(iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.

	Accountants.  The Company's accounting firm is set forth on Schedule 3.1(ii) of the Disclosure
Schedules.  To the knowledge and belief of the Company, such accounting firm: (i) is a registered public accounting firm as required by the
Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company's Annual Report for the
year ending December 31, 2009. 

	No Disagreements with Accountants and Lawyers.Except as set forth on Schedule 3.1(jj),
there are no disagreements of any kind presently existing, or reasonably anticipated by the Company to arise, between the Company and the
accountants and lawyers formerly or presently employed by the Company which could affect the Company's ability to perform any of its
obligations under any of the Transaction Documents, the Company is current with respect to any fees owed to its accountants and lawyers.

	Enforcement of Lock-Up and Voting Agreements.  The Company covenants (i) to enforce the provisions of the Lock-Up Agreements and the Voting Agreement by and between the
Company and Mr. Lei Gu and Mr. Cao Wei, (ii)

                              21

to prevent any unauthorized transfers by such
directors, officers and affiliates of the Company and (iii) not to amend or waive any provision of the Voting
Agreement or any of the Lock-Up Agreements.

	Gold Lion Subsidiaries; Equity Interests.  
(a)Gold Lion owns 100% of the outstanding capital stock of Jiangsu Leimone Electronics Co., Ltd., a foreign
investment enterprise organized under the laws of the PRC ("Jiangsu Leimone"), which in turn owns 51.03% of the
outstanding capital stock of TCB Digital.  All of such outstanding shares of capital stock have been validly issued and are fully paid and
nonassessable and are as of the date of this Agreement owned as set forth above free and clear of all Liens and in accordance with all
applicable PRC laws and regulations.

(b)Gold Lion owns 100% of the outstanding capital stock of Profit Harvest Corporation Ltd., a company organized
and existing under the laws of Hong Kong ("Profit Harvest").  All of such outstanding shares of capital stock have
been validly issued and are fully paid and nonassessable and are as of the date of this Agreement owned as set forth above free and clear of
all Liens and in accordance with all applicable Hong Kong laws and regulations.

(c)Except for its interests in Jiangsu Leimone and Profit Harvest, Gold Lion does not as of the date of this
Agreement own, directly or indirectly, any capital stock or other securities of, or have any beneficial ownership interest in, or hold any equity
or similar interest, or have any investment in any corporation, limited liability company, partnership, limited partnership, joint venture or other
company, person or other entity.  

	Representations Incorporated by Reference.  In addition to the representations and warranties
otherwise set forth herein, all representations and warranties of the Company, Zoom Telephonics, Inc., a corporation incorporated in the
State of Delaware ("Zoom Telephonics"), Gold Lion and TCB Digital Ever Leader contained in that certain Share Exchange
Agreement dated as of January 28, 2009, by and among the Company, Zoom Telephonics, Lei Gu, Gold Lion and TCB Digital are hereby
incorporated by reference for the benefit of the Purchasers as if such representations and warranties were repeated herein and addressed to
the Purchasers.

3.2   Representations and Warranties of the Purchasers.    Each Purchaser, for itself and for no other
Purchaser, hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a
specific date therein):

	Organization; Authority.  Such Purchaser is either an individual or an entity duly organized, validly
existing and in good standing under the laws of the jurisdiction of its organization with full right, corporate or partnership power and authority
to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such Purchaser of the transactions
contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership, limited liability company or

                              22

similar action, as applicable, on the part of such Purchaser.  Each Transaction Document to which it is a party has been duly executed by
such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding
obligation of such Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors' rights
generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar
as indemnification and contribution provisions may be limited by applicable law.

	Own Account.  Such Purchaser understands that the Securities are "restricted securities"
and have not been registered under the Securities Act or any applicable state securities law and is acquiring the Securities as principal for its
own account and not with a view to or for distributing or reselling such Securities or any part thereof in violation of the Securities Act or any
applicable state securities law, has no present intention of distributing any of such Securities in violation of the Securities Act or any
applicable state securities law and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding
the distribution of such Securities in violation of the Securities Act or any applicable state securities law (this representation and warranty not
limiting such Purchaser's right to sell the Securities pursuant to the Registration Statement or otherwise in compliance with applicable federal
and state securities laws).  Such Purchaser is acquiring the Securities hereunder in the ordinary course of its business.

	Purchaser Status.  At the time such Purchaser was offered the Securities, it was, and as of the date
hereof it is, and on each date on which it exercises any Warrants or converts any Common Stock it will be either: (i) an "accredited
investor" as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a "qualified institutional
buyer" as defined in Rule 144A(a) under the Securities Act.  Such Purchaser is not required to be registered as a broker-dealer under
Section 15 of the Exchange Act.

	Experience of Such Purchaser.  Such Purchaser, either alone or together with its representatives, has
such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the
prospective investment in the Securities, and has so evaluated the merits and risks of such investment.  Such Purchaser is able to bear the
economic risk of an investment in the Securities and, at the present time, is able to afford a complete loss of such investment.

	General Solicitation.  Such Purchaser is not, to its knowledge, purchasing the Securities as a result of
any advertisement, article, notice or other communication regarding the Securities published in any newspaper, magazine or similar media or
broadcast over television or radio or presented at any seminar or, to such Purchaser's knowledge, any other general solicitation or general
advertisement.

                              23

	Certain Transactions and Confidentiality.  Other than consummating the
transactions contemplated hereunder, such Purchaser has not directly or indirectly, nor has any Person acting on behalf of or pursuant to any
understanding with such Purchaser, executed any purchases or sales, including Short Sales, of the securities of the Company during
the period commencing as of the time that such Purchaser first received a term sheet (written or oral) from the Company or any other Person
representing the Company setting forth the material terms of the transactions contemplated hereunder and ending immediately prior to the
execution hereof.  Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed
investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser's assets and the portfolio managers
have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser's assets,
the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the
investment decision to purchase the Securities covered by this Agreement.  Other than to other Persons party to this Agreement, such
Purchaser has maintained the confidentiality of all disclosures made to it in connection with this transaction (including the existence and
terms of this transaction). Notwithstanding the foregoing, for avoidance of doubt, nothing contained herein shall constitute a representation or
warranty, or preclude any actions, with respect to the identification of the availability of, or securing of, available shares to borrow in order to
effect Short Sales or similar transactions in the future.

ARTICLE IV. 

                           OTHER AGREEMENTS OF THE PARTIES

4.1   Transfer Restrictions.

	The Securities may only be disposed of in compliance with state and federal securities laws.  In connection with
any transfer of Securities other than pursuant to an effective registration statement or Rule 144, the Company may require the transferor
thereof to provide to the Company an opinion of counsel selected by the Company, to the effect that such transfer does not require
registration of such transferred Securities under the Securities Act.  As a condition of transfer, any such transferee shall agree in writing to be
bound by the terms of this Agreement and the Registration Rights Agreement and shall have the rights and obligations of a Purchaser under
this Agreement and the Registration Rights Agreement. 

	The Purchasers agree to the imprinting, so long as is required by this Section 4.1, of a legend on any Shares,
Warrants and Warrant Shares in substantially the following form:

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE, IF
APPLICABLE, HAS BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM

                              24

REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR
IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY UNLESS SOLD OR
TRANSFERRED TO A "QUALIFIED INSTITUTIONAL BUYER" WITHIN THE MEANING OF RULE 144A UNDER THE 1933 ACT
OR UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.  THIS SECURITY AND THE SECURITIES ISSUABLE
UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES.

	Certificates evidencing the Shares and the Warrant Shares shall not contain any legend (including the legend set
forth in Section 4.1(b) hereof): (i) while a registration statement (including the Registration Statement) covering the resale of such security is
effective under the Securities Act, (ii) following any sale of such Shares or Warrant Shares pursuant to Rule 144, (iii) if such Shares or
Warrant Shares, as the case may be, are eligible for sale under Rule 144, without the requirement for the Company to be in compliance with
the current public information required under Rule 144 as to such Shares or Warrant Shares, as the case may be, and without volume or
manner-of-sale restrictions or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the staff of the Commission). The Company shall cause its counsel to issue a legal opinion to
the Transfer Agent promptly after the Effective Date if required by the Transfer Agent to effect the removal of the legend hereunder.  If any
Warrant is exercised or any Shares are sold at a time when there is an effective registration statement to cover the resale of the Warrant
Shares or the Shares, as the case may be, or if such Warrant Shares or Shares may be sold under Rule 144 and the Company is then in
compliance with the current public information required under Rule 144, or if such Warrant Shares or Shares may be sold under Rule 144
without the requirement for the Company to be in compliance with the current public information required under Rule 144 as to such Warrant
Shares or Shares and without volume or manner-of-sale restrictions or if such legend is not otherwise required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Warrant Shares
or Shares, as the case may be, shall be issued free of all legends.  The Company agrees that following (i) the Effective Date, (ii) if such
Warrant Shares or Shares may be sold under Rule 144 without the requirement for the Company to be in compliance with the current public
information required under Rule 144 as to such Warrant Shares or Shares and without volume or manner-of-sale restrictions or (iii) at such
time as such legend is no longer required under this Section 4.1(c), it will, no later

                              25

than three Trading Days following the delivery by a
Purchaser to the Company or the Transfer Agent of a certificate representing Warrant Shares or the Shares, as applicable, issued with a
restrictive legend (such third Trading Day, the "Legend Removal Date"), deliver or cause to be delivered to such
Purchaser a certificate representing such shares that is free from all restrictive and other legends.  The Company may not make any notation
on its records or give instructions to the Transfer Agent that enlarge the restrictions on transfer set forth in this Section 4.  Certificates for
Warrant Shares and Shares subject to legend removal hereunder shall be transmitted by the Transfer Agent to the Purchaser by crediting the
account of the Purchaser's broker with the Depository Trust Company System as directed by such Purchaser.

	Each Purchaser, severally and not jointly with the other Purchasers, agrees with the Company that such
Purchaser will sell any Securities pursuant to either the registration requirements of the Securities Act, including any applicable prospectus
delivery requirements, or an exemption therefrom, and that if Securities are sold pursuant to a Registration Statement, they will be sold in
compliance with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive legend from certificates
representing Securities as set forth in this Section 4.1 is predicated upon the Company's reliance upon this understanding.

4.2   Furnishing of Information; Public Information, Failure of Registration.  

	If the Common Stock is not registered under Section 12(b) or 12(g) of the Exchange Act on the date hereof, the
Company agrees to cause the Common Stock to be registered under Section 12(g) of the Exchange Act on or before the Closing Date. Until
the time that no Purchaser owns any Securities, the Company covenants to maintain the registration of the Common Stock under Sections
12(b) or 12(g) of the Exchange Act and to timely file (or obtain extensions in respect hereof and file within the applicable grace periods) all
reports required to be filed by the Company after the date hereof pursuant to the Exchange Act even if the Company is not then subject to the
reporting requirements of the Exchange Act.

	At any time during the period commencing from the six (6) month anniversary of the Closing Date and ending at
such time that all of the Securities, if a registration statement is not available for the resale of all of the Securities, may be sold without
restriction or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1), if the Company shall fail for
any reason to satisfy the current public information requirement under Rule 144(c) (a "Public Information Failure") then, as partial
relief for the damages to any holder of Securities by reason of any such delay in or reduction of its ability to sell the Securities (which remedy
shall not be exclusive of any other remedies available at law or in equity), the Company shall pay to each such holder an amount in cash
equal to two percent (2.0%) of the aggregate Purchase Price of such holder's Securities that cannot be sold resulting directly from such
Public Information Failure on the day of a Public Information Failure and on every thirtieth day (pro rated for periods totaling less than thirty
days) thereafter until the earlier

                              26

of (i) the date such Public Information Failure is cured and (ii) such time that such public information is no
longer required pursuant to Rule 144.  The payments to which a holder shall be entitled pursuant to this Section 4(n) are referred to
herein as "Public Information Failure Payments."  Public Information Failure Payments shall be paid on the earlier of (I) the
last day of the calendar month during which such Public Information Failure Payments are incurred and (II) the third Business Day after the
event or failure giving rise to the Public Information Failure Payments is cured.  In the event the Company fails to make Public
Information Failure Payments in a timely manner, such Public Information Failure Payments shall bear interest at the rate of 1.5% per month
(prorated for partial months) until paid in full.

4.3   Integration.  The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in
respect of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a
manner that would require the registration under the Securities Act of the sale of the Securities or that would be integrated with the offer or
sale of the Securities for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to
the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction. 

4.4   Exercise Procedures.  The form of Notice of Exercise included in the Warrants set forth the
totality of the procedures required of the Purchasers in order to exercise the Warrants.  No additional legal opinion, other information or
instructions shall be required of the Purchasers to exercise their Warrants.  The Company shall honor exercises of the Warrants and shall
deliver Warrant Shares in accordance with the terms, conditions and time periods set forth in the Transaction Documents.

4.5   Securities Laws Disclosure; Publicity.  The Company shall, by 8:30 a.m. (New York City time) on the
Trading Day immediately following the date hereof, issue a Current Report on Form 8-K and press release disclosing the material terms of
the transactions contemplated hereby, and including the Transaction Documents as exhibits thereto.  Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission or
any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except: (a) as required by federal securities law
in connection with (i) any registration statement contemplated by the Registration Rights Agreement and (ii) the filing of final Transaction
Documents (including signature pages thereto) with the Commission and (b) to the extent such disclosure is required by law or Trading
Market regulations, in which case the Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause
(b

4.6   Shareholder Rights Plan.  No claim will be made or enforced by the Company or, with the consent of the
Company, any other Person, that any Purchaser is an "Acquiring Person" under any control share acquisition, business
combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or
hereafter adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any

                              27

such plan or arrangement, by
virtue of receiving Securities under the Transaction Documents or under any other agreement between the Company and the
Purchasers.

4.7   Non-Public Information.  From and after the filing of the 8-K Filing with the SEC, no Purchaser shall be
in possession of any material, nonpublic information received from the Company, any of its Subsidiaries or any of their respective officers,
directors, employees or agents, that is not disclosed in the 8-K Filing.  The Company shall not, and shall cause each of its Subsidiaries
and its and each of their respective officers, directors, employees and agents, not to, provide any Purchaser with any material, nonpublic
information regarding the Company or any of its Subsidiaries from and after the filing of the 8-K Filing with the SEC without the prior express
written consent of such Purchaser.  If a Purchaser has, or believes it has, received any such material, nonpublic information regarding
the Company or any of its Subsidiaries from the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates or
agents, it may provide the Company with written notice thereof.  In the event of the disclosure of any material nonpublic information,
the Company shall comply with its obligations under Regulation FD promulgated under the Securities Act and the Exchange Act by filing a
press release and current report on Form 8-K disclosing the material non-public information within five days of its disclosure to any
Purchaser.  Subject to the foregoing, neither the Company, its Subsidiaries nor any Purchaser shall issue any press releases or any
other public statements with respect to the transactions contemplated hereby; provided, however, that the Company shall be entitled, without
the prior approval of any Purchaser, to make any press release or other public disclosure with respect to such transactions (i) in
substantial conformity with the 8-K Filing and contemporaneously therewith and (ii) as is required by applicable law and regulations
(provided that in the case of clause (i) each Purchaser shall be consulted by the Company in connection with any such press release or
other public disclosure prior to its release).  Without the prior written consent of any applicable Purchaser, neither the Company nor any
of its Subsidiaries or affiliates shall disclose the name of such Purchaser in any filing, announcement, release or otherwise.

4.8   Use of Proceeds.  The Company shall use the net proceeds from the sale of the Securities hereunder
for software development, additional production equipment and other working capital purposes.

4.9   Reservation and Listing of Securities.

	The Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant
to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction
Documents.

	If, on any date, the number of authorized but unissued (and otherwise unreserved) shares of Common Stock is
less than the Required Minimum on such date, then the Board of Directors shall use commercially reasonable efforts to amend the
Company's certificate or articles of incorporation to increase the number of authorized but unissued shares of Common Stock to at least the
Required Minimum at such time, as soon as possible and in any event not later than the 75th day after such date.

                              28

	The Company shall, if applicable: (i) by the Closing Date, prepare and file with such Trading Market an additional
shares listing application covering a number of shares of Common Stock at least equal to the Required Minimum on the date of such
application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for listing or quotation on such Trading
Market as soon as possible thereafter, (iii) provide to the Purchasers evidence of such listing or quotation and (iv) maintain the listing or
quotation of such Common Stock on any date at least equal to the Required Minimum on such date on such Trading Market or another
Trading Market. 

4.10   Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other
Purchasers, covenants that neither it, nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases
or sales, including Short Sales, of any of the Company's securities during the period commencing with the execution of this Agreement and
ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as
described in Section 4.5.  Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as the
transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described in
Section 4.5, such Purchaser will maintain the confidentiality of the existence and terms of this transaction and the information included in the
Transaction Documents and the Disclosure Schedules.  Notwithstanding the foregoing, and notwithstanding anything contained in this
Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty or
covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that the transactions
contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.5, (ii) no
Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance with applicable
securities laws from and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the
initial press release as described in Section 4.5 and (iii) no Purchaser shall have any duty of confidentiality to the Company or its Subsidiaries
after the issuance of the initial press release as described in Section 4.5.  Notwithstanding the foregoing, in the case of a Purchaser
that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser's assets and
the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of
such Purchaser's assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the portfolio
manager that made the investment decision to purchase the Securities covered by this Agreement. 

4.11   Additional Issuances of Securities. 

	For purposes of this Section 4.11, the following definitions shall apply.

	"Common Stock Equivalents" means, collectively, Options and Convertible Securities 

                              29

	"Convertible Securities" means any stock or securities (other than Options) convertible into or
exercisable or exchangeable for shares of Common Stock.

	"Options" means any rights, warrants or options to subscribe for or purchase shares of Common
Stock or Convertible Securities.

	From the date hereof and until the earlier of (i) seven (7) months after the Closing Date, provided that the
Company is in compliance with the current public information requirement under Rule 144(c) on such date and on such date the Company is
unaware of any of any facts or circumstances that might prevent the Company from complying with its current public information requirement
set forth in Rule 144(c) in the foreseeable future and (ii) thirty (30) days after the date when a Registration Statement is effective, covering the
resale of all of the Registrable Securities (as defined in the Registration Rights Agreement) (the "Trigger Date"), the Company will
not, directly or indirectly, file any registration statement with the SEC other than the Registration Statement (as defined in the Registration
Rights Agreement).  From the date hereof until the Trigger Date, the Company will not, (i) directly or indirectly, offer, sell, grant any option to
purchase, or otherwise dispose of (or announce any offer, sale, grant or any option to purchase or other disposition of) any of its or its
Subsidiaries' equity or equity equivalent securities, including without limitation any debt, preferred stock or other instrument or security that is,
at any time during its life and under any circumstances, convertible into or exchangeable or exercisable for shares of Common Stock or
Common Stock Equivalents (any such offer, sale, grant, disposition or announcement being referred to as a "Subsequent
Placement") or (ii) be party to any solicitations, negotiations or discussions with regard to the foregoing.

	From the Trigger Date until the second anniversary of the Closing Date, the Company will not, directly or
indirectly, effect any Subsequent Placement unless the Company shall have first complied with this Section 4.11.
	The Company shall deliver to each Purchaser an irrevocable written notice (the "Offer Notice") of any proposed or
intended issuance or sale or exchange (the "Offer") of the securities being offered (the "Offered Securities") in a
Subsequent Placement, which Offer Notice shall (w) identify and describe the Offered Securities, (x) describe the price and other terms
upon which they are to be issued, sold or exchanged, and the number or amount of the Offered Securities to be issued, sold or exchanged,
(y) identify the persons or entities (if known) to which or with which the Offered Securities are to be offered, issued, sold or exchanged
and (z) offer to issue and sell to or exchange with such Purchasers all of the Offered Securities, allocated among such Purchasers (a) based
on such Purchaser's pro rata portion of the aggregate number of shares of Common Stock purchased hereunder (the "Basic
Amount"), and (b) with respect to each Purchaser that elects to purchase its Basic Amount, any additional portion of the Offered
Securities attributable to the Basic Amounts of other Purchasers as such Purchaser shall indicate it will purchase or acquire should the other
Purchasers subscribe for less than their Basic Amounts (the "Undersubscription Amount"), which process shall

                              30

be repeated once until the Purchasers shall have an opportunity to subscribe for any remaining Undersubscription Amount.

	To accept an Offer, in whole or in part, such Purchaser must deliver a written notice to the Company prior to the end of the fifth
(5th) Business Day after such Purchaser's receipt of the Offer Notice (the "Offer Period"), setting forth the portion of
such Purchaser's Basic Amount that such Purchaser elects to purchase and, if such Purchaser shall elect to purchase all of its Basic Amount,
the Undersubscription Amount, if any, that such Purchaser elects to purchase (in either case, the "Notice of Acceptance").  If the
Basic Amounts subscribed for by all Purchasers are less than the total of all of the Basic Amounts, then each Purchaser who has set forth an
Undersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition to the Basic Amounts subscribed for, the
Undersubscription Amount it has subscribed for; provided, however, that if the Undersubscription Amounts subscribed for
exceed the difference between the total of all the Basic Amounts and the Basic Amounts subscribed for (the "Available Undersubscription
Amount"), each Purchaser who has subscribed for any Undersubscription Amount shall be entitled to purchase only that portion of the
Available Undersubscription Amount as the Basic Amount of such Purchaser bears to the total Basic Amounts of all Purchasers that have
subscribed for Undersubscription Amounts, subject to rounding by the Company to the extent its deems reasonably necessary.
Notwithstanding anything to the contrary contained herein, if the Company desires to modify or amend the terms and conditions of the Offer
prior to the expiration of the Offer Period, the Company may deliver to the Purchasers a new Offer Notice and the Offer Period shall expire on
the third (3rd) Business Day after such Purchaser's receipt of such new Offer Notice.
	The Company shall have fourteen (14) calendar days from the expiration of the Offer Period above to offer, issue, sell or exchange all or
any part of such Offered Securities as to which a Notice of Acceptance has not been given by the Purchasers (the "Refused
Securities") pursuant to a definitive agreement (the "Subsequent Placement Agreement")  but only to the offerees described in
the Offer Notice (if so described therein) and only upon terms and conditions (including, without limitation, unit prices and interest rates) that
are not more favorable to the acquiring person or persons or less favorable to the Company than those set forth in the Offer Notice and (ii) to
publicly announce (a) the execution of such Subsequent Placement Agreement, and (b) either (x) the consummation of the transactions
contemplated by such Subsequent Placement Agreement or (y) the termination of such Subsequent Placement Agreement, which shall be
filed with the SEC on a Current Report on Form 8-K with such Subsequent Placement Agreement and any documents contemplated therein
filed as exhibits thereto.
	In the event the Company shall propose to sell less than all the Refused Securities (any such sale to be in the manner and on the terms
specified in Section 4.11(c)(ii) above), then each Purchaser may, at its sole option and in its sole discretion, reduce the number or amount of
the Offered Securities specified in its Notice of Acceptance to an amount that shall be not less than the number or amount of the

                              31

Offered Securities that such Purchaser elected to purchase pursuant to Section 4.11(c)(ii) above multiplied by a fraction, (i) the numerator of which
shall be the number or amount of Offered Securities the Company actually proposes to issue, sell or exchange (including Offered Securities
to be issued or sold to Purchasers pursuant to Section 4.11(c)(ii) above prior to such reduction) and (ii) the denominator of which shall be the
original amount of the Offered Securities.  In the event that any Purchaser so elects to reduce the number or amount of Offered Securities
specified in its Notice of Acceptance, the Company may not issue, sell or exchange more than the reduced number or amount of the Offered
Securities unless and until such securities have again been offered to the Purchasers in accordance with Section 4.11(c)(ii) above.

	Upon the closing of the issuance, sale or exchange of all or less than all of the Refused Securities, the Purchasers shall acquire from the
Company, and the Company shall issue to the Purchasers, the number or amount of Offered Securities specified in the Notices of
Acceptance, as reduced pursuant to  4.11(c)(ii) above if the Purchasers have so elected, upon the terms and conditions specified in the Offer.
The purchase by the Purchasers of any Offered Securities is subject in all cases to the preparation, execution and delivery by the Company
and the Purchasers of a purchase agreement relating to such Offered Securities reasonably satisfactory in form and substance to the
Purchasers and their respective counsel.
	Any Offered Securities not acquired by the Purchasers or other persons in accordance with Section 4.11(c)(ii) above may not be issued,
sold or exchanged until they are again offered to the Purchasers under the procedures specified in this Agreement.
	The Company and the Purchasers agree that if any Purchaser elects to participate in the Offer, neither the Subsequent Placement
Agreement with respect to such Offer nor any other transaction documents related thereto (collectively, the "Subsequent Placement
Documents") shall include any term or provisions whereby any Purchaser shall be required to agree to any restrictions in trading as to
any securities of the Company owned by such Purchaser prior to such Subsequent Placement.
	Notwithstanding anything to the contrary in this Section 4.11 and unless otherwise agreed to by the Purchasers, the Company shall
either confirm in writing to the Purchasers that the transaction with respect to the Subsequent Placement has been abandoned or shall
publicly disclose its intention to issue the Offered Securities, in either case in such a manner such that the Purchasers will not be in
possession of material non-public information, by the fifteenth (15th) Business Day following delivery of the Offer Notice.  If by
the fifteenth (15th) Business Day following delivery of the Offer Notice no public disclosure regarding a transaction with
respect to the Offered Securities has been made, and no notice regarding the abandonment of such transaction has been received by the
Purchasers, such transaction shall be deemed to have been abandoned and the Purchasers shall not be deemed to be in possession of any material,

                              32

non-public information with respect to the Company.  Should the Company decide to pursue such transaction with respect to the
Offered Securities, the Company shall provide each Purchaser with another Offer Notice and each Purchaser will again have the right of
participation set forth in this Section 4.11.  The Company shall not be permitted to deliver more than one such Offer Notice to the Purchasers
in any 60 day period.

ARTICLE V. 

                  MISCELLANEOUS
 

5.1   Capital Contribution. No later than December
10, 2011, the Company shall cause Gold Lion to contribute one hundred
percent (100%) of the net proceeds from the sale of the Securities to Jiangsu Leimone. The Company will cause Gold Lion to contribute one hundred percent (100%)
of the registered capital of Jiangsu Leimone within two (2) years from the date of issuance of the business
license of Jiangsu Leimone.

5.2   Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser's
obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written
notice to the other parties, if the Closing has not been consummated on or before October 7, 2009.

5.3   Fees and Expenses.  Except as expressly set forth in the Transaction Documents to the contrary, each
party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such
party incident to the negotiation, preparation, execution, delivery and performance of this Agreement.  The Company shall pay all Transfer
Agent fees, stamp taxes and other taxes and duties levied in connection with the delivery of any Securities to the Purchasers.  The Company
shall pay an expense allowance to Hudson Bay Fund LP (a Purchaser) or its designee(s) for all reasonable costs and expenses incurred in
connection with the transactions contemplated by the Transaction Documents (including all reasonable legal fees and disbursements in
connection therewith, documentation and implementation of the transactions contemplated by the Transaction Documents and due diligence
in connection therewith), in an amount not to exceed $20,000.

5.4   Entire Agreement.  The Transaction Documents, together with the exhibits and schedules thereto,
contain the entire understanding of the parties with respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents,
exhibits and schedules.

5.5   Notices.  Any and all notices or other communications or deliveries required or permitted to be provided
hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 5:30 p.m. (New
York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m.
(New York City time) on any Trading Day, (c) the second (2nd) Trading Day following

                              33

the date of mailing, if sent by U.S.
nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given.  The
address for such notices and communications shall be as set forth on the signature pages attached hereto.

5.6   Amendments; Waivers.  No provision of this Agreement may be waived, modified, supplemented or
amended except in a written instrument signed, in the case of an amendment, by the Company and the Purchasers holding at least 75% in
interest of the Securities purchased hereunder or, in the case of a waiver, by the party against whom enforcement of any such waived
provision is sought.  No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be
a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.

5.7   Headings.  The headings herein are for convenience only, do not constitute a part of this Agreement
and shall not be deemed to limit or affect any of the provisions hereof.

5.8   Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties
and their successors and permitted assigns.  The Company may not assign this Agreement or any rights or obligations hereunder without the
prior written consent of each Purchaser (other than by merger).  Any Purchaser may assign any or all of its rights under this Agreement to
any Person to whom such Purchaser assigns or transfers any Securities, provided that such transferee agrees in writing to be bound, with
respect to the transferred Securities, by the provisions of the Transaction Documents that apply to the "Purchasers."

5.9   No Third-Party Beneficiaries.  This Agreement is intended for the benefit of the parties hereto and their
respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person,
except as otherwise set forth in Section 4.10.

5.10   Governing Law.  All questions concerning the construction, validity, enforcement and interpretation of
the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York,
without regard to the principles of conflicts of law thereof.  Each party agrees that all legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought
against a party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced exclusively in
the state and federal courts sitting in the City of New York.  Each party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in the City of New York, borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction
Documents), 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 improper or is an inconvenient venue for such proceeding.
Each party hereby irrevocably waives personal service

                              34

of process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for 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 other manner permitted by
law.   If either party shall commence an action or proceeding to enforce any provisions of the Transaction Documents, then the prevailing
party in such action or proceeding shall be reimbursed by the other party for its reasonable attorneys' fees and other costs and expenses
incurred with the investigation, preparation and prosecution of such action or proceeding.

5.11   Survival.  The representations and warranties contained herein shall survive the Closing and the
delivery of the Securities.

5.12   Execution.  This Agreement may be executed in two or more counterparts, all of which when taken
together 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, it being understood that both parties need not sign the same counterpart.  In the event that any signature is
delivered by facsimile transmission or by e-mail delivery of a ".pdf" format data file, such signature shall create a valid and binding
obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or
".pdf" signature page were an original thereof.

5.13   Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of
competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth
herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their
commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter
declared invalid, illegal, void or unenforceable.

5.14   Replacement of Securities.  If any certificate or instrument evidencing any Securities is mutilated, lost,
stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the
case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft or destruction.  The applicant for a new certificate or instrument under such circumstances
shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement
Securities.

5.15   Remedies.  In addition to being entitled to exercise all rights provided herein or granted by law, including
recovery of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents.
The parties agree that

                              35

monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations
contained in the Transaction Documents and hereby agree to waive and not to assert in any action for specific performance of any such
obligation the defense that a remedy at law would be adequate.  

5.16   Payment Set Aside. To the extent that the Company makes a payment or payments to any Purchaser
pursuant to any Transaction Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the
proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set
aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any
other person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action),
then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full
force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

5.17   Independent Nature of Purchasers' Obligations and Rights.  The obligations of each Purchaser under
any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any
way for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document.  Nothing contained
herein or in any other Transaction Document, and no action taken by any Purchaser pursuant thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any
way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents.  Each
Purchaser shall be entitled to independently protect and enforce its rights, including, without limitation, the rights arising out of this Agreement
or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any
proceeding for such purpose.  Each Purchaser has been represented by its own separate legal counsel in their review and negotiation of the
Transaction Documents.  For reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to
communicate with the Company through Sichenzia Ross Friedman Ference LLP.  Sichenzia Ross Friedman Ference LLP does not represent
any of the Purchasers and only represents Global Hunters Securities LLC.  The Company has elected to provide all Purchasers with the
same terms and Transaction Documents for the convenience of the Company and not because it was required or requested to do so by any
of the Purchasers.

5.18   Saturdays, Sundays, Holidays, etc.If the last or appointed day for the taking of any action or the
expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised
on the next succeeding Business Day.

5.19   Construction. The parties agree that each of them and/or their respective counsel has reviewed and had
an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any

                              36

amendments hereto. In
addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment
for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after
the date of this Agreement.

5.20   WAIVER OF JURY TRIAL.  IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION
BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE
GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND
EXPRESSLY WAIVES FOREVER TRIAL BY JURY. 

(Signature Pages Follow)

                              37

IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by
their respective authorized signatories as of the date first indicated above.

	
ZOOM TECHNOLOGIES, INC.

 
	
Address for Notice:

	
By:__________________________________________

     Name:

     Title:

With a copy to (which shall not constitute notice):
	
Fax:

	

 

 
	 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

                  SIGNATURE PAGE FOR PURCHASER FOLLOWS]

                              38

PURCHASER SIGNATURE PAGES TO SECURITIES PURCHASE AGREEMENT

IN WITNESS WHEREOF, the undersigned have caused this Securities Purchase Agreement to be duly executed by
their respective authorized signatories as of the date first indicated above.

Name of Purchaser: ________________________________________________________

Signature of Authorized Signatory of Purchaser: __________________________________

Name of Authorized Signatory: ____________________________________________________

Title of Authorized Signatory: _____________________________________________________

Email Address of Authorized Signatory: _____________________________________________

Facsimile Number of Authorized Signatory: __________________________________________

Address for Notice of Purchaser:

 

 

 

Address for Delivery of Securities for Purchaser (if not same as address for notice):

 

 

 

 

Subscription Amount: _____________

Warrant Shares: _________________

 

 

 

EIN Number:  

 

[SIGNATURE PAGES CONTINUE]

                              39

 

Annex A 

CLOSING STATEMENT

Pursuant to the attached Securities Purchase Agreement, dated as of the date hereto, the purchasers shall purchase
up to $10,000,000 of Common Stock and Warrants from Zoom Technologies, Inc. a Delaware corporation (the
"Company").  All funds will be wired into an account maintained by the Escrow Agent.  All funds will be disbursed in
accordance with this Closing Statement.  

Disbursement Date:[________ ___, 2009

	
I.   PURCHASE PRICE

	 
	
Gross Proceeds to be Received 
	
$10,000,000

	 	 
	
II.DISBURSEMENTS

	 
	
 
	
$

	
 
	
$

	 	
$

	 	
$

	 	
$

	 	 
	
Total Amount Disbursed:
	
$

	 	 
	 	 
	 	 
	
WIRE INSTRUCTIONS:

 
	 
	
To: _____________________________________

 

 

 

 
	 
	
To: _____________________________________

 

 

 

 
	 

 

 

                              40

ANNEX B

CONFIDENTIAL PURCHASER QUESTIONNAIRE

ZOOM TECHNOLOGIES, INC. 

THIS QUESTIONNAIRE MUST BE ANSWERED FULLY AND RETURNED ALONG WITH YOUR COMPLETED SUBSCRIPTION
AGREEMENT IN CONNECTION WITH YOUR PROSPECTIVE PURCHASE OF SECURITIES FROM ZOOM TECHNOLOGIES, INC.
 (THE "COMPANY").

THE INFORMATION SUPPLIED IN THIS QUESTIONNAIRE WILL BE HELD IN STRICT CONFIDENCE.  NO INFORMATION WILL BE
DISCLOSED EXCEPT TO THE EXTENT THAT SUCH DISCLOSURE IS REQUIRED BY LAW OR REGULATION, OTHERWISE
DEMANDED BY PROPER LEGAL PROCESS OR IN LITIGATION INVOLVING THE COMPANY AND ITS CONTROLLING PERSONS.

Capitalized terms used herein without definition shall have the respective meanings given such terms as set forth in the Securities
Purchase Agreement between the Company and the Purchaser signatory thereto (the "Purchaser Agreement") dated as
of October __, 2009.

(1)The undersigned represents and warrants that he, she or it comes within at least one category marked below, and that for
any category marked, he, she or it has truthfully set forth, where applicable, the factual basis or reason the undersigned comes within that
category.  The undersigned agrees to furnish any additional information which the Company deems necessary in order to verify the answers
set forth below.

	

Category A ___

	

The undersigned is an individual (not a partnership, corporation, etc.) whose individual net worth, or joint
net worth with his or her spouse, presently exceeds $1,000,000.

Explanation.  In calculating net worth you may include equity in personal property and real estate, including your principal residence,
cash, short-term investments, stock and securities.  Equity in personal property and real estate should be based on the fair market value of
such property less debt secured by such property.

	

Category B ___

	

The undersigned is an individual (not a partnership, corporation, etc.) who had an income in excess of
$200,000 in each of the two most recent years, or joint income with his or her spouse in excess of $300,000 in each of those years (in each
case including foreign income, tax exempt income and full amount of capital gains and losses but excluding any income of other family
members and any unrealized capital appreciation) and has a reasonable expectation of reaching the same income level in the current

	

Category C ___

	

The undersigned is a director or executive officer of the Company which is issuing and selling the
Securities.

	

Category D ___

	

The undersigned is a bank, as defined in Section 3(a)(2) of the Securities Act of 1933, as amended
(the "Act"); a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Act, whether acting in
its individual or fiduciary capacity; any insurance company as defined in Section 2(13) of the Act; any investment company registered
under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; any Small
Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state
or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan
within the meaning of the Employee Retirement Income Security Act of 1974 if the investment decision is made by a plan fiduciary, as defined
in Section 3(21) of such act, which is either a bank, savings and loan association, insurance company, or registered investment
advisor, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made
solely by persons that are accredited investors (describe entity).

________________________________________________________________

  ________________________________________________________________

                              41

	

Category E ___

	

The undersigned is a private business development company as defined in section 202(a) (22) of the
Investment Advisors Act of 1940 (describe entity)  

________________________________________________________________

  ________________________________________________________________

	

Category F ___

	

The undersigned is either a corporation, partnership, Massachusetts business trust, or non-profit
organization within the meaning of Section 501(c)(3) of the Internal Revenue Code, in each case not formed for the specific purpose of
acquiring the Securities and with total assets in excess of $5,000,000. (describe entity)

________________________________________________________________

  ________________________________________________________________

	

Category G ___

	

The undersigned is a trust with total assets in excess of $5,000,000, not formed for the specific purpose of
acquiring the Securities, where the purchase is directed by a "sophisticated investor" as defined in Regulation
506(b)(2)(ii) under the Act.

	

Category H ___

	

The undersigned is an entity (other than a trust) in which all of the equity owners are "accredited
investors" within one or more of the above categories.  If relying upon this Category alone, each equity owner must complete a separate
copy of this Purchaser Questionnaire.  (describe entity)

________________________________________________________________

  ________________________________________________________________

The undersigned agrees that the undersigned will notify the Company at any time on or prior to the applicable Closing (as defined in the
Memorandum) in the event that the representations and warranties in this Purchaser Questionnaire shall cease to be true, accurate and
complete.

(2)Suitability (please answer each question)

(a)For an individual, please describe your current employment, including the company by which you are employed and its principal
business:

________________________________________________________________

  ________________________________________________________________   

  ________________________________________________________________

(b)For individuals, do you expect your current level of income to significantly decrease in the foreseeable future?

                              42

	
YES ______ 
	 	 	
NO ______ 
	 

(c)For trust, corporate, partnership and other institutional subscribers, do you expect your total assets to significantly decrease in the
foreseeable future?

	
YES ______ 
	 	 	
NO ______ 
	 

(d)For all subscribers, are you familiar with the risk aspects and the non-liquidity of investments such as the Securities for which you
seek to purchase?

	
YES ______ 
	 	 	
NO ______ 
	 

(e)For all subscribers, do you understand that there is no guarantee of financial return on this investment and that you run the risk of
losing your entire investment?

	
YES ______ 
	 	 	
NO ______ 
	 

(3)Manner in which title is to be held: (circle one)

(a)Individual Ownership

(b)Community Property

(c)Joint Tenant with Right of Survivorship (both parties must sign)

(d)Partnership

(e)Tenants in Common

(f)Company

(g)Trust

(h)Other

(4)FINRA Affiliation.

Are you affiliated or associated with an FINRA member firm (please check one):

	
YES ______ 
	 	 	
NO ______ 
	 

If Yes, please describe how you are affiliated/associated:

_________________________________________________________

   _________________________________________________________

   _________________________________________________________

*If subscriber is a Registered Representative with an FINRA member firm, have the following acknowledgment signed by the appropriate
party:

The undersigned FINRA member firm acknowledges receipt of the notice required by the FINRA Conduct Rules.

 

_________________________________

   Name of FINRA Member Firm

                              43

 

By: ______________________________

       Authorized Officer

Date: ____________________________

 

(5) For Trust Subscribers

A. Certain trusts generally may not qualify as accredited investors except under special circumstances.  Therefore, if you intend to
purchase the shares of the Company's stock in whole or in part through a trust, please answer each of the following questions.

Is the trustee of the trust a national or state bank that is acting in its fiduciary capacity in making the investment on behalf of the
trust?

Yes o
                   No o

Does this investment in the Company exceed 10% of the trust assets?

Yes o
                   No o

B. If the trust is a revocable trust, please complete Question 1 below.  If the trust is an irrevocable trust, please
complete Question 2 below.

 

1.REVOCABLE TRUSTS

Can the trust be amended or revoked at any time by its grantors:

Yes o
                   No o

 

 

If yes, please answer the following questions relating to each grantor (please add sheets if necessary):

Grantor Name: _________________________

Net worth of grantor (including spouse, if applicable), including home, home furnishings and automobiles exceeds $1,000,000?

Yes o
                   No o

OR

Income (exclusive of any income attributable to spouse) was in excess of $200,000 for 2006 and 2007 and is reasonably expected to be
in excess of $200,000 for 2008?

Yes o
                   No o

OR

Income (including income attributable to spouse) was in excess of $300,000 for 2006 and 2007 and is reasonably expected to be in
excess of $300,000 for 2008?

Yes o
                   No o

                              44

2.IRREVOCABLE TRUSTS

If the trust is an irrevocable trust, please answer the following questions:

Please provide the name of each trustee:

Trustee Name: ________________________________________

Trustee Name: ________________________________________

Does the trust have assets greater than $5 million?

Yes o
                   No o

Do you have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an
investment in the Company?

Yes o
                   No o

Indicate how often you invest in:

Marketable Securities

Often o
Occasionally o
Seldom o
Never o

 

Restricted Securities

Often o
Occasionally o
Seldom o
Never o

Venture Capital Companies

Often o
Occasionally o
Seldom o
Never o

 

 

[Remainder of page intentionally left blank]

                              45

The undersigned has been informed of the significance to the Company of the foregoing representations and answers contained in
this Confidential Purchaser Questionnaire and such representations and answers have been provided with the understanding that the
Company and the Selling Agent will rely on them.  

	 	 	 	
Individual

	
Date:
	
________________________
	 	

________________________ 

   Name of Individual

 (Please type or print)

________________________ 

   Signature of Individual

 

________________________ 

   Name of Joint Owner

    (Please type or print)

 

________________________ 

   Signature (Joint Owner) 

 

	 	 	 	
Partnership, Corporation or

   Other Entity

	
Date:
	
________________________
	 	
________________________ 

Print or Type Entity Name 

 

By: Name: ________________________ 

Print or Type Name

Title:________________________ 

________________________ 

Signature 

 

Title:________________________ 

________________________ 

Signature (other authorized signatory)

 

                             46

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