Document:

Exhibit 10.2

                        EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT, dated as of March 29, 2005, between
Prudential Savings Bank, a Pennsylvania-chartered, stock-form
savings bank (the "Bank" or the "Employer"), and Joseph R.
Corrato (the "Executive").

                           WITNESSETH

     WHEREAS, the Executive is presently an officer of the Bank;

     WHEREAS, the Employer desires to be ensured of the
Executive's continued active participation in the business of the
Employer; and

     WHEREAS, in order to induce the Executive to remain in the
employ of the Employer and in consideration of the Executive's
agreeing to remain in the employ of the Employer, the parties
desire to specify the severance benefits which shall be due the
Executive in the event that his employment with the Employer is
terminated under specified circumstances.

     NOW THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereby agree as
follows:

     1.   Definitions.  The following words and terms shall have
the meanings set forth below for the purposes of this Agreement:

     (a)  Average Annual Compensation.  The Executive's "Average
Annual Compensation" for purposes of this Agreement shall be
deemed to mean the average amount of Base Salary and cash bonus
received by the Executive from the Employer or any subsidiary
thereof (excluding any deferred amounts) during the most recent
five calendar years preceding the Date of Termination (or such
shorter period as the Executive was employed).

     (b)  Base Salary.  "Base Salary" shall have the meaning set
forth in Section 3(a) hereof.

     (c)  Cause. Termination of the Executive's employment for
"Cause" shall mean termination because of personal dishonesty,
incompetence, willful misconduct, breach of fiduciary duty
involving personal profit, intentional failure to perform stated
duties, willful violation of any law, rule or regulation (other
than traffic violations or similar offenses) or final cease-and-
desist order, willful conduct which is materially detrimental
(monetarily or otherwise) to the Employer or material breach of
any provision of this Agreement.

     (d)  Change in Control of the Corporation.  "Change in
Control of the Corporation" shall mean the occurrence of any of
the following:  (i) an event that would be required to be
reported by, or with respect to, the Corporation in response to
Item 5.01 of Form 8-K or Item 6(e) of Schedule 14A of Regulation
14A pursuant to the Securities Exchange Act of 1934, as amended

("Exchange Act"), or any successor thereto, whether or not any
class of securities of the Corporation is registered under the
Exchange Act; (ii) any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act) other than the MHC is or
becomes the "beneficial owner" (as defined in Rule 13d-under the
Exchange Act), directly or indirectly, of securities of the
Corporation representing 20% or more of the combined voting power
of the Corporation's then outstanding securities; or (iii) during
any period of three consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the
Corporation cease for any reason to constitute at least a
majority thereof unless the election, or the nomination for
election by stockholders, of each new director was approved by a
vote of at least two-thirds of the directors then still in office
who were directors at the beginning of the period; provided,
however, that no Change in Control of the Corporation shall be
deemed to have occurred solely because the MHC undertakes a
"second-step" mutual to stock conversion.

     (e)  Code.  "Code" shall mean the Internal Revenue Code of
1986, as amended.

     (f)  Corporation.  "Corporation" shall mean Prudential
Bancorp, Inc. of Pennsylvania, the "mid-tier" holding company for
the Bank, or any successor thereto.

     (g)  Date of Termination.  "Date of Termination" shall mean
(i) if the Executive's employment is terminated for Cause or for
Disability, the date specified in the Notice of Termination, and
(ii) if the Executive's employment is terminated for any other
reason, the date on which a Notice of Termination is given or as
specified in such Notice.

     (h)  Disability.  Termination by the Employer of the
Executive's employment based on "Disability" shall mean
termination because of any physical or mental impairment which
qualifies the Executive for disability benefits under the
applicable long-term disability plan maintained by the Employer
or any subsidiary or, if no such plan applies, which would
qualify the Executive for disability benefits under the Federal
Social Security System.

     (i)  Good Reason.  Termination by the Executive of the
Executive's employment for "Good Reason" shall mean termination
by the Executive within twelve (12) months following a Change in
Control of the Corporation based on:

          (i)  Without the Executive's express written consent,
               the failure to elect or to re-elect or to appoint
               or to re-appoint the Executive to the office of
               Executive Vice President and Chief Financial
               Officer of the Employer or a material adverse
               change made by the Employer in the Executive's
               functions, duties or responsibilities as Executive
               Vice President and Chief Financial Officer of the
               Employer;

          (ii) Without the Executive's express written consent, a
               reduction by the Employer in the Executive's Base
               Salary as the same may be increased from time to
               time or, except to the extent permitted by Section
               3(b) hereof, a reduction in the package of fringe
               benefits provided to the Executive, taken as a
               whole;

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         (iii) The principal executive office of the
               Employer is relocated more than 20 miles from the
               Employer's current main office location in
               Philadelphia, Pennsylvania, or, without the
               Executive's express written consent, the Employer
               requires the Executive to be based anywhere other
               than an area in which the Employer's principal
               executive office is located, except for required
               travel on business of the Employer to an extent
               substantially consistent with the Executive's
               present business travel obligations;

          (iv) Any purported termination of the Executive's
               employment for Disability or Retirement which is
               not effected pursuant to a Notice of Termination
               satisfying the requirements of paragraph (l)
               below; or

          (v)  The failure by the Employer to obtain the
               assumption of and agreement to perform this
               Agreement by any successor as contemplated in
               Section 9 hereof.

     (j)  IRS.  "IRS" shall mean the Internal Revenue Service.

     (k)  MHC.  "MHC" shall mean Prudential Mutual Holding
Company, the parent mutual holding company for the Corporation
and the Bank.

     (l)  Notice of Termination.  Any purported termination of
the Executive's employment by the Employer for any reason,
including without limitation for Cause, Disability or Retirement,
or by the Executive for any reason, including without limitation
for Good Reason, shall be communicated by written "Notice of
Termination" to the other party hereto.  For purposes of this
Agreement, a "Notice of Termination" shall mean a dated notice
which (i) indicates the specific termination provision in this
Agreement relied upon, (ii) sets forth in reasonable detail the
facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so
indicated, (iii) specifies a Date of Termination, which shall be
not less than thirty (30) nor more than ninety (90) days after
such Notice of Termination is given, except in the case of the
Employer's termination of the Executive's employment for Cause,
which shall be effective immediately; and (iv) is given in the
manner specified in Section 10 hereof.

     (m)  Retirement.  "Retirement" shall mean voluntary
termination by the Executive in accordance with the Employer's
retirement policies, including early retirement, generally
applicable to the Employer's salaried employees.

     2.   Term of Employment.

     (a)  The Employer hereby employs the Executive as Executive
Vice President and Chief Financial Officer and the Executive
hereby accepts said employment and agrees to render such services
to the Employer on the terms and conditions set forth in this
Agreement. Subject to the terms hereof, this Agreement shall
terminate two (2) years after the date first above written.
Beginning on the day which is one year subsequent to the date
first above written, and on each annual anniversary thereafter,
the term of this Agreement shall be extended for a period of one
additional year provided that the Employer has not given notice
to the Executive in writing at least

                                     3

30 days prior to such day that the term of this Agreement shall
not be extended further and/or the Executive has not given notice
to the Employer of his election not to extend the term at least
thirty (30) days prior to any such anniversary date.  If any party
gives timely notice that the term will not be extended as of any
such annual anniversary date, then this Agreement shall terminate
at the conclusion of its remaining term.  References herein to the
term of this Agreement shall refer both to the initial term and
successive terms.

     (b)  During the term of this Agreement, the Executive shall
perform such executive services for the Employer as is consistent
with his title of Executive Vice President and Chief Financial
Officer and from time to time assigned to him by the Employer's
Board of Directors.

     3.   Compensation and Benefits.

     (a)  The Employer shall compensate and pay the Executive for
his services during the term of this Agreement at a minimum base
salary of $130,000 per year ("Base Salary"), which may be
increased from time to time in such amounts as may be determined
by the Board of Directors of the Employer and may not be
decreased without the Executive's express written consent.  In
addition to his Base Salary, the Executive shall be entitled to
receive during the term of this Agreement such bonus payments as
may be determined by the Board of Directors of the Employer.

     (b)  During the term of this Agreement, the Executive shall
be entitled to participate in and receive the benefits of any
pension or other retirement benefit plan, profit sharing, stock
option, restricted stock, employee stock ownership, or other
plans, benefits and privileges given to employees and executives
of the Employer, to the extent commensurate with his then duties
and responsibilities, as fixed by the Board of Directors of the
Employer.  The Employer shall not make any changes in such plans,
benefits or privileges which would adversely affect the
Executive's rights or benefits thereunder, unless such change
occurs pursuant to a program applicable to all executive officers
of the Employer and does not result in a proportionately greater
adverse change in the rights of or benefits to the Executive as
compared with any other executive officer of the Employer.
Nothing paid to the Executive under any plan or arrangement
presently in effect or made available in the future shall be
deemed to be in lieu of the salary payable to the Executive
pursuant to Section 3(a) hereof.

     (c)  During the term of this Agreement, the Executive shall
be entitled to paid annual vacation in accordance with the
policies as established from time to time by the Board of
Directors of the Employer.  The Executive shall not be entitled
to receive any additional compensation from the Employer for
failure to take a vacation, nor shall the Executive be able to
accumulate unused vacation time from one year to the next, except
to the extent authorized by the Board of Directors of the
Employer.

     4.   Expenses.  The Employer shall reimburse the Executive
or otherwise provide for or pay for all reasonable expenses
incurred by the Executive in furtherance of, or in connection
with the business of the Employer, including, but not by way of
limitation, automobile and traveling expenses, subject to such
reasonable documentation and other limitations as may be
established by the Board of Directors of the Employer.  If such
expenses are paid in the first instance by the Executive, the
Employer shall reimburse the Executive therefor.

                                     4

     5.   Termination.

     (a)  The Employer shall have the right, at any time upon
prior Notice of Termination, to terminate the Executive's
employment hereunder for any reason, including without limitation
termination for Cause, Disability or Retirement, and the
Executive shall have the right, upon prior Notice of Termination,
to terminate his employment hereunder for any reason.

     (b)  In the event that the (i) the Executive's employment is
terminated by the Employer for Cause, or (ii) the Executive
terminates his employment hereunder other than for Good Reason,
the Executive shall have no right pursuant to this Agreement to
compensation or other benefits for any period after the
applicable Date of Termination.

     (c)  In the event that the Executive's employment is
terminated as a result of Disability, Retirement or the
Executive's death during the term of this Agreement, the
Executive shall have no right pursuant to this Agreement to
compensation or other benefits for any period after the
applicable Date of Termination.

     (d)  In the event that (i) the Executive's employment is
terminated by the Employer for other than Cause, Disability,
Retirement or the Executive's death or (ii) such employment is
terminated by the Executive due to a material breach of this
Agreement by the Employer, which breach has not been cured within
fifteen (15) days after a written notice of non-compliance has
been given by the Executive to the Employer then the Employer
shall,

          (A)  pay to the Executive, in either twelve (12) equal
     monthly installments beginning with the first business day
     of the month following the Date of Termination or in a lump
     sum within five business days of the Date of Termination (at
     the Executive's election), a cash severance amount equal to
     one (1) times the Executive's Average Annual Compensation;
     provided, however, that this Section 5(d) shall not be
     applicable if the termination of employment occurs
     concurrently with or subsequent to a Change in Control of
     the Corporation; and

          (B)  maintain and provide for a period ending at the
     earlier of (i) one (1) year subsequent to the Date of
     Termination or (ii) the date of the Executive's full-time
     employment by another employer (provided that the Executive
     is entitled under the terms of such employment to benefits
     substantially similar to those described in this
     subparagraph (B)), at no cost to the Executive, the
     Executive's continued participation in all group insurance,
     life insurance, health and accident, disability and other
     employee benefit plans, programs and arrangements in which
     the Executive was entitled to participate immediately prior
     to the Date of Termination (other than stock option and
     restricted stock plans of the Employer or the Corporation),
     provided that in the event that the Executive's
     participation in any plan, program or arrangement as
     provided in this subparagraph (B) is barred or during such
     period any such plan, program or arrangement is discontinued
     or the benefits thereunder materially reduced, the Employer
     shall arrange to provide the Executive with benefits
     substantially similar to those which the Executive was
     entitled to receive under such plans, programs and
     arrangements immediately prior to the Date of Termination.

                                     5

     (e)  In the event that (i) the Executive's employment is
terminated concurrently with or subsequent to a Change in Control
of the Corporation for other than Cause, Disability, Retirement
or the Executive's death or (ii) the Executive elects to
terminate his employment for Good Reason, then the Employer
shall, subject to the provisions of Section 6 hereof, if
applicable,

          (A)  pay to the Executive, in either twenty-four (24)
     equal monthly installments beginning with the first business
     day of the month following the Date of Termination or in a
     lump sum within five business days of the Date of
     Termination (at the Executive's election), a cash severance
     amount equal to two (2) times the Executive's Average Annual
     Compensation; and

          (B)  maintain and provide for a period ending at the
     earlier of (i) two (2) years subsequent to the Date of
     Termination or (ii) the date of the Executive's full-time
     employment by another employer (provided that the Executive
     is entitled under the terms of such employment to benefits
     substantially similar to those described in this
     subparagraph (B)), at no cost to the Executive, the
     Executive's continued participation in all group insurance,
     life insurance, health and accident, disability and other
     employee benefit plans, programs and arrangements in which
     the Executive was entitled to participate immediately prior
     to the Date of Termination (other than stock option and
     restricted stock plans of the Employer), provided that in
     the event that the Executive's participation in any plan,
     program or arrangement as provided in this subparagraph (B)
     is barred or during such period any such plan, program or
     arrangement is discontinued or the benefits thereunder are
     materially reduced, the Employer shall arrange to provide
     the Executive with benefits substantially similar to those
     which the Executive was entitled to receive under such
     plans, programs and arrangements immediately prior to the
     Date of Termination.

     6.   Limitation of Benefits under Certain Circumstances.  If
the payments and benefits pursuant to Section 5 hereof, either
alone or together with other payments and benefits which the
Executive has the right to receive from the Employer, would
constitute a "parachute payment" under Section 280G of the Code,
the payments and benefits payable by the Employer pursuant to
Section 5 hereof shall be reduced, in the manner determined by
the Executive,  by the amount, if any, which is the minimum
necessary to result in no portion of the payments and benefits
under Section 5 being non-deductible to the Employer pursuant to
Section 280G of the Code and subject to the excise tax imposed
under Section 4999 of the Code.  The determination of any
reduction in the payments and benefits to be made pursuant to
Section 5 shall be based upon the opinion of independent tax
counsel selected by the Employer and paid by the Employer.  Such
counsel shall be reasonably acceptable to the Employer and the
Executive; shall promptly prepare the foregoing opinion, but in
no event later than thirty (30) days from the Date of
Termination; and may use such actuaries as such counsel deems
necessary or advisable for the purpose.  Nothing contained herein
shall result in a reduction of any payments or benefits to which
the Executive may be entitled upon termination of employment
under any circumstances other than as specified in this Section
6, or a reduction in the payments and benefits specified in
Section 5 below zero.

                                      6

     7.   Mitigation; Exclusivity of Benefits.

     (a)  The Executive shall not be required to mitigate the
amount of any benefits hereunder by seeking other employment or
otherwise, nor shall the amount of any such benefits be reduced
by any compensation earned by the Executive as a result of
employment by another employer after the Date of Termination or
otherwise, except as set forth in Sections 5(d)(B)(ii) and
5(e)(B)(ii) hereof.

     (b)  The specific arrangements referred to herein are not
intended to exclude any other benefits which may be available to
the Executive upon a termination of employment with the Employer
pursuant to employee benefit plans of the Employer or otherwise.

     8.   Withholding.  All payments required to be made by the
Employer hereunder to the Executive shall be subject to the
withholding of such amounts, if any, relating to tax and other
payroll deductions as the Employer may reasonably determine
should be withheld pursuant to any applicable law or regulation.

     9.   Assignability.  The Employer may assign this Agreement
and its rights and obligations hereunder in whole, but not in
part, to any corporation, bank or other entity with or into which
the Employer may hereafter merge or consolidate or to which the
Employer may transfer all or substantially all of its assets, if
in any such case said corporation, bank or other entity shall by
operation of law or expressly in writing assume all obligations
of the Employer hereunder as fully as if it had been originally
made a party hereto, but may not otherwise assign this Agreement
or its rights and obligations hereunder.  The Executive may not
assign or transfer this Agreement or any rights or obligations
hereunder.

     10.  Notice.  For the purposes of this Agreement, notices
and all other communications provided for in this Agreement shall
be in writing and shall be deemed to have been duly given when
delivered or mailed by certified or registered mail, return
receipt requested, postage prepaid, addressed to the respective
addresses set forth below:

     To the Employer:  Board of Directors
                       Prudential Savings Bank
                       1834 Oregon Avenue
                       Philadelphia, Pennsylvania 19145

     To the Executive: Joseph R. Corrato
                       At the address last appearing on the
                       personnel records of Executive

     11.  Amendment; Waiver.  No provisions of this Agreement may
be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by
the Executive and such officer or officers as may be specifically
designated by the Board of Directors of the Employer to sign on
its behalf.  No waiver by any party hereto at any time of any
breach by any other party hereto of, or compliance with, any
condition or provision of this

                                     7

Agreement to be performed by such other party shall be deemed a
waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time.

     12.  Governing Law.  The validity, interpretation,
construction and performance of this Agreement shall be governed
by the laws of the United States where applicable and otherwise
by the substantive laws of the Commonwealth of Pennsylvania.

     13.  Nature of Obligations.  Nothing contained herein shall
create or require the Employer to create a trust of any kind to
fund any benefits which may be payable hereunder, and to the
extent that the Executive acquires a right to receive benefits
from the Employer hereunder, such right shall be no greater than
the right of any unsecured general creditor of the Employer.

     14.  Headings.  The section headings contained in this
Agreement are for reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement.

     15.  Validity.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provisions of this Agreement, which
shall remain in full force and effect.

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

     17.  Regulatory Prohibition.  Notwithstanding any other
provision of this Agreement to the contrary, any payments made to
the Executive pursuant to this Agreement, or otherwise, are
subject to and conditioned upon their compliance with Section
18(k) of the FDIA (12 U.S.C. Section 1828(k)) and the regulations
promulgated thereunder, including 12 C.F.R. Part 359.  In the
event of the Executive's termination of employment with the Bank
for Cause, all employment relationships and managerial duties
with the Bank shall immediately cease regardless of whether the
Executive is in the employ of the Corporation following such
termination.  Furthermore, following such termination for Cause,
the Executive will not, directly or indirectly, influence or
participate in the affairs or the operations of the Bank.

     18.  Payment of Costs and Legal Fees and Reinstatement of
Benefits.  In the event any dispute or controversy arising under
or in connection with the Executive's termination is resolved in
favor of the Executive, whether by judgment, arbitration or
settlement, the Executive shall be entitled to the payment of (a)
all legal fees incurred by the Executive in resolving such
dispute or controversy, and (b) any back-pay, including Base
Salary, bonuses and any other cash compensation, fringe benefits
and any compensation and benefits due to the Executive under this
Agreement.

     19.  Entire Agreement.  This Agreement embodies the entire
agreement between the Employer and the Executive with respect to
the matters agreed to herein.  All prior agreements between the
Employer and the Executive with respect to the matters agreed to
herein are hereby superseded and shall have no force or effect.

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     IN WITNESS WHEREOF, this Agreement is effective as of the
date first above written.

Attest                           PRUDENTIAL SAVINGS BANK

/s/ Lucy R. Cohen                By: /s/ Thomas A. Vento
_________________                    _____________________________________
                                     Thomas A. Vento
                                     President and Chief Executive Officer

                                 EXECUTIVE

                                 By: /s/ Joseph R. Corrato
                                     ______________________
                                     Joseph R. Corrato

                                     9EXHIBIT 10.1
                          SECURITIES PURCHASE AGREEMENT

         This Securities  Purchase  Agreement (this  "AGREEMENT") is dated as of
March 28,  2005,  among  Roaming  Messenger,  Inc.,  a Nevada  corporation  (the
"Company"), and Wings Fund, Inc. a Nevada corporation (the "INVESTOR").

         WHEREAS,  subject  to the  terms  and  conditions  set  forth  in  this
Agreement and pursuant to Section 4(2) of the Securities Act (as defined below),
and Rule 506  promulgated  thereunder,  the Company desires to issue and sell to
the Investor, and the Investor desires to purchase from the Company Five Million
(5,000,000)  shares of Common  Stock (as defined  below) on the Closing Date (as
defined below).

         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 the Investor agree as
follows:

                                   ARTICLE I.
                                   DEFINITIONS

         1.1  DEFINITIONS. In addition to the terms  defined  elsewhere  in this
Agreement,  for all purposes of this  Agreement,  the  following  terms have the
meanings indicated in this Section 1.1:

         "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 144.  With
respect to Investor, any investment fund or managed account that is managed on a
discretionary basis by the same investment manager as Investor will be deemed to
be an Affiliate of Investor.

         "CLOSING"  means the  closing  of the  purchase  and sale of the Common
Stock pursuant to Section 2.1.

         "CLOSING  DATE"  means  the  Trading  Day when  all of the  Transaction
Documents  have been executed and delivered by the applicable  parties  thereto,
and all  conditions  precedent  to (a)  the  Investors'  obligations  to pay the
Subscription Amount and (b) the Company's obligations to deliver the Shares have
been satisfied or waived.

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

         "COMMON STOCK" means the common stock of the Company,  $0.001 par value
per share,  and any  securities  into which such common  stock may  hereafter be
reclassified.

         "COMMON STOCK  EQUIVALENTS"  means any securities of the Company or the
Subsidiaries  which  would  entitle  the  holder  thereof to acquire at any time
shares of Common Stock, including without limitation, any debt, preferred stock,
rights,  options,  warrants or other  instrument that is at any time convertible
into or exchangeable  for, or otherwise  entitles the holder thereof to receive,
shares of Common Stock.

                                       1
<PAGE>

         "COMPANY  COUNSEL"  means  Sichenzia  Ross  Friedman  Ference LLP, with
offices at 1065 Avenue of the Americas,  New York,  New York 10018,  Tel:  (212)
930-9700, Fax: (212) 930-9725.

         "DISCLOSURE  SCHEDULES"  means the Disclosure  Schedules of the Company
attached hereto and incorporated herein.

         "EFFECTIVE DATE" means the date that a Registration  Statement is first
declared effective by the Commission.

         "ESCROW AGENT" means Company Counsel.

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

         "INTELLECTUAL  PROPERTY RIGHTS" shall have the meaning ascribed to such
term in Section 3.1(o).

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

         "MATERIAL  ADVERSE EFFECT" shall have the meaning ascribed to such term
in Section 3.1(b).

         "MATERIAL  PERMITS"  shall have the  meaning  ascribed  to such term in
Section 3.1(m).

         "OTCBB" means the Over-The-Counter Bulletin Board.

         "PER SHARE PURCHASE PRICE" equals $0.10.

         "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 legal entity of any kind.

         "PROCEEDING" means an action, claim, suit,  investigation or proceeding
(including,  without limitation, an investigation or partial proceeding, such as
a deposition).

         "REGISTRATION  STATEMENT"  means a registration  statement  meeting the
requirements  set forth in the  Registration  Rights  Agreement and covering the
resale by the  Investors of the Shares or a portion  thereof (as provided for in
the Registration Rights Agreement).

         "REGISTRATION   RIGHTS   AGREEMENT"  means  the   Registration   Rights
Agreement,  dated as of the date of this Agreement, by and among the Company and
each Investor, in the form of Exhibit A hereto.

         "REQUIRED  APPROVALS"  shall have the meaning  ascribed to such term in
Section 3.1(e).

         "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.

                                       2
<PAGE>

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

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

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

         "SUBSCRIPTION AMOUNT" means, as to Investor, $500,000, in United States
dollars and in immediately available funds.

         "SUBSIDIARY"  shall mean the  subsidiaries of the Company,  if any, set
forth on Schedule 3.1(a).

         "TRADING  DAY"  means a day on which  the  Common  Stock is traded on a
Trading Market.

         "TRADING  MARKET" means each of the  following  markets or exchanges on
which the Common  Stock is listed or quoted for trading on the date in question:
OTCBB,  the American Stock  Exchange,  the New York Stock  Exchange,  the Nasdaq
National Market or the Nasdaq SmallCap Market.

         "TRANSACTION  DOCUMENTS"  means  this  Agreement  and the  Registration
Rights  Agreement and any other  documents or agreements  executed in connection
with the transactions contemplated hereunder.

                                  ARTICLE II.
                                PURCHASE AND SALE

         2.1 CLOSING. On the Closing  Date,  Investor  shall  purchase  from the
Company,  and the  Company  shall  issue  and  sell to  Investor,  Five  Million
(5,000,000)  Shares at the Per Share Purchase Price for aggregate  consideration
of $500,000. Upon satisfaction or waiver of the conditions set forth in Sections
2.2(a),  (b),  (c) and (d),  the  Closing  shall occur at the offices of Company
Counsel or such other location as the parties shall mutually agree.

         2.2 DELIVERIES; CLOSING CONDITIONS.

         (a) On the  Closing  Date,  the  Company  shall  deliver or cause to be
delivered to Investor the following:

                  (i) this Agreement duly executed by the Company;

                  (ii) a copy of duly executed irrevocable  instructions,  which
                  shall be  satisfactory  in form and substance to the Investor,
                  to the Company's transfer agent instructing the transfer agent
                  to deliver, on an expedited basis, a certificate  evidencing a
                  number  of  Shares  equal to  Investor's  Subscription  Amount
                  divided by the Per Share  Purchase  Price,  registered  in the
                  name of such Investor;

                  (iii) the  Registration  Rights Agreement duly executed by the
                  Company;

                                       3
<PAGE>

                  (iv) the Escrow Agreement duly executed by the Company; and

         (b)  On the  Closing  Date,  Investor  shall  deliver  or  cause  to be
delivered to the Company the following:

                  (i) this Agreement duly executed by Investor;

                  (ii)  Investor's  Subscription  Amount by wire transfer to the
                  Escrow Agent;

                  (iii) the Escrow Agreement duly executed by Investor; and

                  (iv)  the  Registration  Rights  Agreement  duly  executed  by
                  Investor.

         (c) All  representations  and  warranties of the other party  contained
herein shall remain true and correct in all material  respects as of the Closing
Date and all covenants of the other party shall have been performed if due prior
to such date.

         (d) From the date  hereof to the  Closing  Date,  trading in the Common
Stock shall not have been suspended by the Commission (except for any suspension
of trading of limited duration agreed to by the Company,  which suspension shall
be terminated prior to the Closing), and, at any time prior to the Closing Date,
trading in securities  generally shall not have been suspended or limited on any
Trading  Market,  nor shall a general  commercial  banking  moratorium have been
declared  either by the United States or New York State  authorities,  nor shall
there have occurred any material  outbreak or escalation of hostilities or other
national or  international  calamity of such  magnitude in its effect on, or any
material  adverse  change in, any financial  market which,  in each case, in the
reasonable  judgment of Investors  representing  a majority of the  Subscription
Amounts made by all Investors, makes it impracticable or inadvisable to purchase
the Shares at the Closing.

                                  ARTICLE III.
                         REPRESENTATIONS AND WARRANTIES

         3.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY.  Except as otherwise
set forth under the corresponding  section of the Disclosure  Schedules attached
hereto,  which Disclosure  Schedules shall be deemed a part hereof,  the Company
hereby  represents and warrants as of the date hereof and as of the Closing Date
to each Investor as follows:

         (a)  SUBSIDIARIES.  All of the direct and indirect  Subsidiaries of the
Company  are set  forth on  Schedule  3.1(a).  The  Company  owns,  directly  or
indirectly,  all  of the  capital  stock  or  other  equity  interests  of  each
Subsidiary  free and clear of any  Liens,  and all 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 such securities. If the Company has no subsidiaries, then references
in the Transaction Documents to the Subsidiaries will be disregarded.

         (b)  ORGANIZATION  AND  QUALIFICATION.  Each  of the  Company  and  the
Subsidiaries  is an entity duly  incorporated  or otherwise  organized,  validly

                                       4
<PAGE>

existing  and in  good  standing  under  the  laws  of the  jurisdiction  of its
incorporation  or  organization  (as  applicable),  with the requisite power and
authority to own and use its  properties and assets and to carry on its business
as currently  conducted  except where failure to be so  qualified,  organized or
have such  power  and  authority  would not  reasonably  be  expected  to have a
Material  Adverse  Effect  (as  defined  below).  Neither  the  Company  nor any
Subsidiary is in violation or default of any of the provisions of its respective
certificate  or articles of  incorporation,  bylaws or other  organizational  or
charter documents. 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, would not
have or reasonably be expected to result in (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  or
financial  condition 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 (any of (i), (ii) or (iii), a "Material  Adverse  Effect"),  and to the
knowledge  of the  Company,  no  Proceeding  has  been  instituted  in any  such
jurisdiction  revoking,  limiting or curtailing  or seeking to revoke,  limit or
curtail such power and authority or qualification.

         (c) AUTHORIZATION; ENFORCEMENT. The Company has the requisite corporate
power and authority to execute and deliver this  Agreement and to consummate the
transactions  contemplated by each of the Transaction Documents to which it is a
party and  otherwise to carry out its  obligations  thereunder.  The  execution,
delivery and performance by the Company of each of the Transaction  Documents to
which it is a party and the consummation by it of the transactions  contemplated
thereby have been duly  authorized  by all  necessary  action on the part of the
Company and no further action is required by the Company in connection 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,  will
constitute the valid and legally binding  obligation of the Company  enforceable
against  the  Company  in  accordance  with its terms  except  (i) as limited by
applicable bankruptcy, insolvency, reorganization,  moratorium and other laws of
general application affecting  enforcement of creditors' rights generally,  (ii)
as  limited  by laws  relating  to the  availability  of  specific  performance,
injunctive  relief  or other  equitable  remedies  and  (iii) as the  rights  to
indemnification  or  contribution  hereunder  and  thereunder  may be limited by
applicable law.

         (d) NO  CONFLICTS.  The  execution,  delivery  and  performance  by the
Company of the  Transaction  Documents to which it is a party,  the issuance and
sale of the Shares and the consummation by the Company of the other transactions
contemplated  thereby  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,  or (ii)
conflict with, or constitute a default (or an event that with notice or lapse of
time or both would become a default)  under,  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

                                       5
<PAGE>

party  or by  which  any  property  or  material  asset  of the  Company  or any
Subsidiary is bound, 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 bound,  or (iv) violate the terms of any agreement by
which the Company or any  Subsidiary  is bound or to which any property or asset
of the Company or any Subsidiary is bound; except in the case of each of clauses
(ii), (iii) and (iv), such as would not have or reasonably be expected to result
in a Material Adverse Effect.

         (e)  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) filings required pursuant to Section 4.4 of this Agreement,  (ii)
the  filing  with  the   Commission  of  the   Registration   Statement,   (iii)
application(s)  to each applicable  Trading Market for the listing of the 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,  (v) any other filings  required to be made
pursuant to the terms of the Registration Rights Agreement, and (vi) the notices
set forth on Schedule 3.1(e) (collectively, the "Required Approvals").

         (f) ISSUANCE OF THE SHARES.  The Shares have been duly  authorized and,
when  issued  and  paid for in  accordance  with  the  terms of the  Transaction
Documents,  will be duly and validly issued, fully paid and nonassessable,  free
and clear of all  Liens  imposed  by the  Company  other  than  restrictions  on
transfer provided for in the Transaction  Documents and under applicable federal
and state  securities  laws.  The Company has reserved from its duly  authorized
capital stock the maximum number of shares of Common Stock issuable  pursuant to
this Agreement.

         (g)  CAPITALIZATION.  Since March 21, 2005,  the Company has not issued
any capital stock other than pursuant to the exercise of employee  stock options
under the Company's  stock option plans,  the issuance of shares of Common Stock
to employees pursuant to the Company's employee stock purchase plan and pursuant
to  the  conversion  or  exercise  of  outstanding   Common  Stock   Equivalents
outstanding.  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.  Except as a result of the purchase
and sale of the Shares,  and except for warrants and shares  issuable to certain
advisors listed on Schedule 3.1(g), there are no outstanding options,  warrants,
script rights to subscribe to, calls or commitments of any character  whatsoever
relating  to,  or  securities,   rights  or  obligations   convertible  into  or
exchangeable  for, or giving any Person any right to  subscribe  for or acquire,
any  shares  of Common  Stock,  or  contracts,  commitments,  understandings  or
arrangements  by which the Company or any  Subsidiary  is or may become bound to
issue additional shares of Common Stock, or securities or rights  convertible or
exchangeable  into shares of Common Stock. The issue and sale of the Shares will
not obligate the Company to issue shares of Common Stock or other  securities to
any  Person  (other  than the  Investors)  and will not result in a right of any
holder of Company  securities  to adjust the exercise,  conversion,  exchange or

                                       6
<PAGE>

reset  price under such  securities.  All of the  outstanding  shares of capital
stock of the Company are validly issued, fully paid and nonassessable, have been
issued in compliance  with all federal and state  securities  laws,  and none of
such  outstanding  shares were issued in violation of any  preemptive  rights or
similar rights to subscribe for or purchase  securities.  No further approval or
authorization  of any  shareholder,  the Board of  Directors  of the  Company or
others is required for the issuance and sale of the Shares.  Except as disclosed
in the SEC Reports, there are no shareholders  agreements,  voting agreements or
other similar  agreements  with respect to the Company's  capital stock to which
the Company is a party or, to the knowledge of the Company, between or among any
of the Company's shareholders.

         (h) SEC  REPORTS;  FINANCIAL  STATEMENTS.  The  Company  has  filed all
reports  required to be filed by it under the Exchange  Act,  including  without
limitation,  those filed pursuant to Section 13(a) or 15(d) thereof, for the two
years preceding the date hereof the foregoing materials,  including the exhibits
thereto, being collectively referred to herein as the "SEC Reports") on a timely
basis or has received a valid extension of such time of filing and has filed any
such SEC Reports  prior to the  expiration  of any such  extension.  As of their
respective  dates,  the SEC Reports  complied in all material  respects with the
requirements of the Exchange Act and the rules and regulations of the Commission
promulgated  thereunder,  and none of the SEC Reports, when filed, contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated  therein or necessary in order to make the statements  therein,  in
light of the  circumstances  under  which they were made,  not  misleading.  The
financial  statements  of the Company  included in the SEC Reports  comply as to
form 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.

         (i) MATERIAL  CHANGES.  Since December 31, 2004, except as specifically
disclosed  in the SEC  Reports,  (i)  there  has been no  event,  occurrence  or
development  that has had or that would  reasonably  be  expected to result in a
Material  Adverse  Effect,  (ii) the Company has not  incurred  any  liabilities
(contingent or otherwise)  other than (A)  liabilities  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 required  to be  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
shareholders 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.

                                       7
<PAGE>

         (j) LITIGATION.  There is no action, suit, inquiry, notice of violation
or proceeding pending or, to the knowledge of the Company,  threatened,  nor, to
the  knowledge  of the  Company,  is any  investigation  pending or  threatened,
against the Company, any Subsidiary or any of their respective properties before
or by any court, arbitrator, governmental or administrative agency or regulatory
authority (federal, state, county, local or foreign) (collectively, an "Action")
which (i)  challenges  the legality,  validity or  enforceability  of any of the
Transaction  Documents or the Shares or (ii) would, if there were an unfavorable
decision, have or reasonably be expected to result in a Material Adverse Effect.
Neither the Company nor any Subsidiary, nor to the knowledge of the Company, 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, 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  or any
Subsidiary under the Exchange Act or the Securities Act.

         (k) 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 or any Subsidiary  which would reasonably be expected to result in a
Material Adverse Effect.

         (l)  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  written notice of a claim that it is in default under,  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 in violation of any statute,
rule or regulation of any governmental  authority,  including without limitation
all foreign, federal, state and local laws applicable to its business, except in
each case as would not have a Material Adverse Effect.

         (m) 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 described in the SEC Reports,  except where the failure
to possess such permits  would not have or reasonably be expected to result in a
Material Adverse Effect  ("Material  Permits"),  and neither the Company nor any
Subsidiary  has  received  any  written  notice of  proceedings  relating to the
revocation or modification of any Material Permit.

         (n) TITLE TO  ASSETS.  The  Company  and the  Subsidiaries  have  good,
marketable  and fee  simple  title to all real  property  owned by them  that is
material to the business of the Company and the  Subsidiaries and valid 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

                                       8
<PAGE>

the Subsidiaries are held by them under valid, subsisting and enforceable leases
and no landlord for any such real  property or facility has notified the Company
or any such Subsidiary that any of them are in default under any such lease.

         (o) 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, copyrights, licenses and other similar
rights  necessary  or  material  for use in  connection  with  their  respective
businesses  as  described  in the SEC  Reports  and which the failure to so have
would have a Material Adverse Effect (collectively,  the "Intellectual  Property
Rights").  Neither the Company nor any  Subsidiary has received a written notice
that 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
known  existing  infringement  by  another  Person  of any  of the  Intellectual
Property Rights of others which would have a Material Adverse Effect.

         (p) INSURANCE. The Company and the Subsidiaries are insured by insurers
of recognized financial responsibility against such losses and risks and in such
amounts as the Company  believes are prudent and customary in the  businesses in
which the Company and the Subsidiaries are engaged.  Neither the Company nor any
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 without a significant increase in cost.

         (q) TRANSACTIONS WITH AFFILIATES AND EMPLOYEES.  Except as set forth in
the SEC Reports and in Schedule 3.1(q), 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 $60,000
other than (i) for payment of salary or consulting  fees for services  rendered,
(ii)  reimbursement for expenses incurred on behalf of the Company and (iii) for
other  benefits  under  benefit  or  pension  plans  sponsored  by the  Company,
including without limitation stock option agreements under any stock option plan
of the Company.

         (r)  SARBANES-OXLEY;  INTERNAL ACCOUNTING  CONTROLS.  The Company is in
material  compliance with all provisions of the Sarbanes-Oxley Act of 2002 which
are  applicable  to it as of  the  Closing  Date.  To  the  extent  required  by
applicable law, the Company and the  Subsidiaries  maintain a system of internal
accounting  controls  sufficient  to  provide  reasonable   assurance  that  (i)
transactions  are executed in accordance with  management's  general or specific
authorizations,   (ii)   transactions   are  recorded  as  necessary  to  permit
preparation  of financial  statements  in  conformity  with GAAP and to maintain
asset  accountability,  (iii) access to assets is permitted  only in  accordance
with  management's  general or  specific  authorization,  and (iv) the  recorded
accountability  for assets is compared  with the existing  assets at  reasonable
intervals and appropriate  action is taken with respect to any  differences.  To

                                       9
<PAGE>

the extent required by applicable  law, the Company has  established  disclosure
controls  and  procedures  (as  defined  in  Exchange  Act Rules  13a-15(e)  and
15d-15(e)) for the Company and designed such disclosure  controls and procedures
to ensure that  material  information  relating to the  Company,  including  its
Subsidiaries,  is made known to the  certifying  officers by others within those
entities.  To the extent  required by applicable  law, the Company's  certifying
officers  have  evaluated  the  effectiveness  of  the  Company's  controls  and
procedures  as of the end of the  period  covered  by its  most  recently  filed
periodic  report  under  the  Exchange  Act (the  date of such  evaluation,  the
"Evaluation  Date").  To the extent  required  by  applicable  law,  the Company
presented in its most recently filed periodic  report under the Exchange Act the
conclusions of the certifying officers about the effectiveness of the disclosure
controls and procedures based on their evaluations as of the Evaluation Date and
since the  Evaluation  Date,  there  have  been no  significant  changes  in the
Company's internal control over financial  reporting (as defined in Exchange Act
Rules  13a-15(f) and 15d-15(f)) or, to the best of the Company's  knowledge,  in
other factors that could significantly affect the Company's internal controls.

         (s) CERTAIN FEES. No brokerage or finder's fees or  commissions  are or
will be  payable by the  Company  or any  Subsidiary  to any  broker,  financial
advisor or consultant, finder, placement agent, investment banker, bank or other
Person with respect to the transactions  contemplated by this Agreement.  To the
knowledge of the Company, the Investors shall have no obligation with respect to
any fees or with  respect to any claims made against the Company 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 this Agreement.

         (t)  PRIVATE  PLACEMENT.   Assuming  the  accuracy  of  the  Investor's
representations  and warranties set forth in Section 3.2, no registration  under
the  Securities  Act is  required  for the offer  and sale of the  Shares by the
Company to the Investors as  contemplated  hereby.  The issuance and sale of the
Shares  hereunder does not  contravene the rules and  regulations of the Trading
Market.

         (u) INVESTMENT COMPANY. The Company is not, and is not an Affiliate of,
and  immediately  after receipt of payment for the Shares,  will not be or be an
Affiliate  of, an  "investment  company"  within the  meaning of the  Investment
Company Act of 1940, as amended.

         (v) REGISTRATION  RIGHTS.  No person has any right to cause the Company
to effect the  registration  under the  Securities  Act of any securities of the
Company.

         (w) LISTING AND MAINTENANCE REQUIREMENT.  The Company's Common Stock is
registered  pursuant to Section  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 written notification that the Commission is
contemplating terminating such registration.

         (x) APPLICATION OF TAKEOVER  PROTECTIONS.  The Company and its Board of
Directors have taken no action, to render  inapplicable any laws of its state of
incorporation that is or could become applicable to the Investors as a result of
the Investors and the Company  fulfilling their  obligations or exercising their
rights  under  the  Transaction  Documents,  including  without  limitation  the

                                       10
<PAGE>

Company's issuance of the Shares and the Investors'  ownership of the Shares and
there  is no  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).

         (y)  DISCLOSURE.  Except as set forth in Schedule 3.1(y) and except for
terms of the Transaction  Documents and the fact that the Company is considering
consummating the transactions  contemplated  therein, the Company confirms that,
neither the Company nor any other  Person  acting on its behalf has provided any
of the Investors or their agents or counsel with any information in writing that
constitutes or might constitute material,  non-public  information.  The Company
understands  and  confirms  that  the  Investors  will  rely  on  the  foregoing
representations  and  covenants in effecting  transactions  in securities of the
Company.  All disclosure  provided to the Investors  regarding the Company,  its
business and the transactions  contemplated  hereby,  including the Schedules to
this  Agreement,  furnished  by or on behalf of the Company  with respect to the
representations  and warranties made herein are true and correct with respect to
such representations and warranties and do 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. The Company acknowledges and agrees that no Investor makes
or has made any  representations  or warranties with respect to the transactions
contemplated  hereby  other than  those  specifically  set forth in Section  3.2
hereof.

         (z) NO  INTEGRATED  OFFERING.  Assuming the accuracy of the  Investors'
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 Shares to be integrated  with prior offerings by the Company for
purposes  of  the  Securities  Act  or  any  applicable   shareholder   approval
provisions,  including,  without limitation,  under the rules and regulations of
the Trading Market.

         (aa)  SOLVENCY.  Based on the 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 Shares hereunder,  (i) the Company's fair saleable
value of its 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 for the current
fiscal  year 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 anticipated uses of the cash, would
be  sufficient to pay all amounts on or in respect of its debt 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).

         (bb) FORM SB-2  ELIGIBILITY.  The Company is  eligible to register  the
resale of its Common Stock by the Investors  under Form SB-2  promulgated  under
the Securities Act.

                                       11
<PAGE>

         (cc) TAXES.  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.

         (dd) GENERAL SOLICITATION. Neither the Company nor any person acting on
behalf  of the  Company  has  offered  or sold any of the  Shares by any form of
general solicitation or general advertising.  The Company has offered the Shares
for sale only to the Investors and certain other  "accredited  investors" within
the meaning of Rule 501 under the Securities Act.

         (ee)  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 corrupt  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.

         (ff) AUDITOR.  The Company's auditors are set forth on Schedule 3.1(ff)
of the  Disclosure  Schedule.  To the  Company's  knowledge,  such  auditors are
independent auditors as required by the Securities Act.

         (gg)  ACKNOWLEDGMENT  REGARDING  INVESTOR'S  PURCHASE  OF  SHARES.  The
Company further  acknowledges  that no Investor is acting as a financial advisor
or  fiduciary of the Company (or in any similar  capacity)  with respect to this
Agreement and the transactions contemplated hereby.

         3.2  Representations  and Warranties of the Investor.  Investor  hereby
represents  and warrants as of the date hereof and as of the Closing Date to the
Company as follows:

         (a)  ORGANIZATION;  AUTHORITY.  Investor is 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 thereunder.  The execution,
delivery and  performance by Investor of the  transactions  contemplated by this
Agreement have been duly authorized by all necessary corporate or similar action
on the part of Investor. Each Transaction Document to which it is party has been
duly executed by Investor, and when delivered by Investor in accordance with the
terms  hereof,  will  constitute  the valid and legally  binding  obligation  of
Investor,  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.

                                       12
<PAGE>

         (b)  INVESTMENT  INTENT.  Investor  understands  that  the  Shares  are
"restricted securities" and have not been registered under the Securities Act or
any applicable state securities law and is acquiring the Shares as principal for
its own  account  for  investment  purposes  only  and not with a view to or for
distributing  or  reselling  such  Shares or any part  thereof,  has no  present
intention  of  distributing  any  of  such  Shares  and  has no  arrangement  or
understanding  with any other persons  regarding the distribution of such Shares
(this  representation  and warranty not  limiting  Investor's  right to sell the
Shares  pursuant to the  Registration  Statement or otherwise in compliance with
applicable federal and state securities laws).  Investor is acquiring the Shares
hereunder in the ordinary  course of its  business.  Investor  does not have any
agreement  or  understanding,   directly  or  indirectly,  with  any  Person  to
distribute any of the Shares.

         (c) INVESTOR  STATUS.  At the time Investor was offered the Shares,  it
was, and at the date hereof it is an "accredited  investor" under the Securities
Act.

         (d)  EXPERIENCE OF SUCH  INVESTOR.  Investor,  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 Shares,  and has so evaluated  the
merits and risks of such investment.  Investor is able to bear the economic risk
of an  investment  in the Shares and, at the present  time,  is able to afford a
complete loss of such investment.

         (e) GENERAL  SOLICITATION.  Investor is not  purchasing the Shares as a
result of any advertisement,  article,  notice or other communication  regarding
the Shares  published in any  newspaper,  magazine or similar media or broadcast
over  television  or radio or  presented  at any  seminar  or any other  general
solicitation or general advertisement.

         (f) INVESTORS ACTING  INDIVIDUALLY.  Investor is acting severally as an
individual and is not acting together with any other Person or other Investor as
a group.

         (g)  OPPORTUNITY  TO CONDUCT DUE  DILIGENCE.  Investor  was granted the
opportunity  to conduct due diligence  prior to entering  into the  transactions
contemplated by this Agreement.

                                  ARTICLE IV.
                         OTHER AGREEMENTS OF THE PARTIES

         4.1 TRANSFER RESTRICTIONS.

         (a) The  Investor  hereby  acknowledges  that  the  Shares  may only be
disposed of in compliance with state and federal  securities laws. In connection
with any  transfer of Shares other than  pursuant to an  effective  registration
statement  or Rule 144,  to the  Company or to an  Affiliate  of  Investor or in
connection  with a pledge as  contemplated  in Section  4.1(b),  the Company may
require the  transferor  thereof to provide to the Company an opinion of counsel
selected by the transferor and  reasonably  acceptable to the Company,  the form
and substance of such opinion shall be reasonably  satisfactory  to the Company,
to the  effect  that  such  transfer  does  not  require  registration  of  such
transferred  Shares  under  the  Securities  Act.  As a  condition  of any  such
transfer, any such transferee shall agree in writing to be bound by the terms of

                                       13
<PAGE>

this  Agreement and shall have the rights of Investor  under this  Agreement and
the Registration Rights Agreement, as applicable.

         (b) The Investor  agrees to the  imprinting,  so long as is required by
this Section 4.1(b), of a legend on any of the Shares in the following form:

                  THESE SHARES HAVE NOT BEEN  REGISTERED WITH THE SECURITIES AND
                  EXCHANGE COMMISSION OR THE SECURITIES  COMMISSION OF ANY STATE
                  IN RELIANCE  UPON AN  EXEMPTION  FROM  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.  THESE  SHARES MAY BE
                  PLEDGED IN CONNECTION  WITH A BONA FIDE MARGIN  ACCOUNT WITH A
                  REGISTERED  BROKER-DEALER  OR  OTHER  LOAN  WITH  A  FINANCIAL
                  INSTITUTION  THAT IS AN  "ACCREDITED  INVESTOR"  AS DEFINED IN
                  RULE 501(a) UNDER THE SECURITIES ACT.

         (c) The Company  acknowledges and agrees that Investor may from time to
time  pledge  pursuant  to a  bona  fide  margin  agreement  with  a  registered
broker-dealer  or grant a  security  interest  in some or all of the Shares to a
financial institution that is an "accredited investor" as defined in Rule 501(a)
under the  Securities  Act and who agrees to be bound by the  provisions of this
Agreement and the Registration Rights Agreement and, if required under the terms
of such  arrangement,  Investor  may transfer  pledged or secured  Shares to the
pledgees or secured  parties.  Such a pledge or transfer would not be subject to
approval of the Company and no legal  opinion of legal  counsel of the  pledgee,
secured party or pledgor shall be required in connection therewith.  Further, no
notice shall be required of such pledge. At the Investor's expense,  the Company
will execute and deliver such reasonable  documentation  as a pledgee or secured
party of Shares may reasonably  request in connection  with a pledge or transfer
of the Shares,  including, if the Shares are subject to registration pursuant to
the Registration  Rights  Agreement,  the preparation and filing of any required
prospectus  supplement  under Rule  424(b)(3)  under the Securities Act or other
applicable  provision of the Securities Act to  appropriately  amend the list of
Selling Stockholders thereunder.

         (d)  Certificates  evidencing  the Shares  shall not contain any legend
(including  the legend set forth in Section  4.1(b)),  (i) while a  registration
statement  (including the  Registration  Statement)  covering the resale of such
security is effective  under the  Securities  Act, or (ii) following any sale of
such Shares  pursuant to Rule 144, or (iii) if such Shares are eligible for sale

                                       14
<PAGE>

under Rule  144(k),  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 Company's  transfer  agent  promptly
after the Effective  Date if required by the Company's  transfer agent to effect
the removal of the legend  hereunder.  The Company  agrees  that  following  the
Effective  Date or at such time as such legend is no longer  required under this
Section  4.1(d),  it will,  no later than seven (7) Trading Days  following  the
delivery  by a Investor  to the  Company or the  Company's  transfer  agent of a
certificate  representing  Shares,  issued with a restrictive legend (such date,
the "Legend Removal Date"),  deliver or cause to be delivered to such Investor 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 any transfer agent of the Company that enlarge the  restrictions
on transfer set forth in this Section.

         (e)  Investor  agrees that the removal of the  restrictive  legend from
certificates  representing Shares as set forth in this Section 4.1 is predicated
upon the Company's  reliance that the Investor will sell any Shares  pursuant to
either the  registration  requirements  of the  Securities  Act,  including  any
applicable prospectus delivery requirements, or an exemption therefrom.

         (f) Until 45 days  after the  Effective  Date,  the  Company  shall not
undertake  a reverse or forward  stock split or  reclassification  of the Common
Stock without the prior written  consent of the Investors  holding a majority in
interest of the Shares.

         4.2  FURNISHING OF  INFORMATION.  As long as Investor owns Shares,  the
Company  covenants to timely file (or obtain  extensions in respect  thereof and
file within the applicable grace period) all reports required to be filed by the
Company after the date hereof  pursuant to the Exchange Act. As long as Investor
owns Shares,  if the Company is no longer  required to file reports  pursuant to
the Exchange Act (or if such filings are not  otherwise  generally  available on
the  Internet  free of charge),  it will  prepare and furnish to Investor  (upon
receipt of a written  request) and make publicly  available in  accordance  with
Rule 144(c) such  information  as is  required  for  Investor to sell the Shares
under Rule 144.  The Company  further  covenants  that it will take such further
action  as any  holder of  Shares  may  reasonably  request,  all to the  extent
required  from time to time to enable such  Person to sell such  Shares  without
registration  under the  Securities  Act within the limitation of the exemptions
provided by Rule 144.

         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  Shares  in a manner  that  would  require  the  registration  under  the
Securities Act of the sale of the Shares to Investor or that would be integrated
with the offer or sale of the Shares 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.

                                       15
<PAGE>

         4.4 SECURITIES LAWS DISCLOSURE; PUBLICITY.

         (a)  Provided  that the Company has received  each item  required to be
delivered  by Investor  pursuant  to Section  2.2(b),  the Company  shall file a
Current Report on Form 8-K  disclosing  the material  terms of the  transactions
contemplated  hereby.  Neither the Company  nor  Investor  shall issue any press
release with respect to the  transaction  contemplated  hereby or otherwise make
any such  public  statement  without  the prior  consent of the  Company,  which
consent  shall  not  unreasonably  be  withheld,  except if such  disclosure  is
required by law, in which case the disclosing  party shall promptly  provide the
other party with prior notice of such public statement or communication.

         (b) Investor shall make all required  filings under the Securities Laws
with respect to Investor's acquisition of the Shares.

         4.5 SHAREHOLDERS  RIGHTS PLAN. No claim will be made or enforced by the
Company or, to the  knowledge of the Company,  any other Person that Investor is
an  "Acquiring  Person"  under any  shareholders  rights plan or similar plan or
arrangement in effect or hereafter adopted by the Company,  or that any Investor
could be deemed to trigger the  provisions of any such plan or  arrangement,  by
virtue of receiving Shares under the Transaction Documents.

         4.6  NON-PUBLIC  INFORMATION.  Except as may be required to comply with
the terms and  conditions of this  Agreement,  the Company  covenants and agrees
that  neither it nor any other  Person  acting on its behalf  will  provide  any
Investor or its agents or counsel with any information that the Company believes
constitutes material non-public information,  unless prior thereto such Investor
shall have executed a written agreement regarding the confidentiality and use of
such information.  The Company understands and confirms that each Investor shall
be  relying  on the  foregoing  representations  in  effecting  transactions  in
securities of the Company.

         4.7 USE OF PROCEEDS.  The Company  shall use the net proceeds  from the
sale of the Shares  hereunder  for general  corporate  and  strategic  purposes,
including,   but  not  limited  to,  working  capital  and  in  connection  with
acquisitions,  joint  ventures and other similar  transactions,  and not for the
satisfaction  of any portion of the Company's  debt (other than payment of trade
payables in the ordinary course of the Company's  business and prior practices),
to redeem any Company  equity or equity  equivalent  securities or to settle any
outstanding litigation.

         4.8  INDEMNIFICATION  OF INVESTORS.  Subject to the  provisions of this
Section 4.8, the Company will indemnify and hold Investor  harmless from any and
all losses, liabilities,  obligations, claims, contingencies, damages, costs and
expenses,   including  without   limitation  all  judgments,   amounts  paid  in
settlements,   court  costs  and  reasonable   attorneys'   fees  and  costs  of
investigation  that  Investor  may suffer or incur as a result of or relating to
(a)  any  breach  of  any  of  the  representations,  warranties,  covenants  or
agreements  made by the Company in this  Agreement  or in the other  Transaction
Documents or (b) any action instituted  against (i) Investor,  or (ii) Investor,
by any  shareholder  of the Company who is not an Affiliate  of  Investor,  with
respect to any of the  transactions  contemplated by the  Transaction  Documents
(unless  such action is based upon a breach of such  Investor's  representation,
warranties,  covenants  or  agreements  under the  Transaction  Documents or any
agreements or understandings  Investor may have with any such shareholder or any
violations by the Investor of state or federal securities laws or any conduct by
such Investor which constitutes fraud,  gross negligence,  willful misconduct or
malfeasance).  If any action  shall be brought  against  Investor  in respect of

                                       16
<PAGE>

which  indemnity  may be  sought  pursuant  to this  Agreement,  Investor  shall
promptly notify the Company in writing,  and the Company shall have the right to
assume the defense thereof with counsel of its own choosing. Investor shall have
the right to employ  separate  counsel in any such action and participate in the
defense  thereof,  but the fees and  expenses  of such  counsel  shall be at the
expense of  Investor  except to the extent that (i) the  employment  thereof has
been  specifically  authorized  by the Company in writing,  (ii) the Company has
failed  after a  reasonable  period of time to assume such defense and to employ
counsel  or (iii) in such  action  there is, in the  reasonable  opinion of such
separate counsel, a material conflict on any material issue between the position
of the Company and the position of  Investor.  The Company will not be liable to
Investor  under this  Agreement  (i) for any  settlement  by  Investor  effected
without the Company's  prior written  consent,  which shall not be  unreasonably
withheld or delayed;  or (ii) to the extent, but only to the extent that a loss,
claim,  damage or liability is attributable  to Investor's  breach of any of the
representations,  warranties,  covenants or agreements  made by the Investors in
this Agreement or in the other Transaction Documents.

         4.9 RESERVATION OF COMMON STOCK. As of the date hereof, the Company has
reserved  and the Company  shall  continue to reserve and keep  available at all
times, free of preemptive  rights, a sufficient number of shares of Common Stock
for the  purpose of  enabling  the  Company  to issue  Shares  pursuant  to this
Agreement.

         4.10  LISTING  OF  COMMON  STOCK.  The  Company  hereby  agrees  to use
commercially reasonable efforts to maintain the listing of the Common Stock on a
Trading Market, and as soon as reasonably practicable following the Closing (but
not later than the earlier of the Effective  Date and the first  anniversary  of
the Closing Date) to list all of the Shares on such Trading Market.  The Company
further  agrees,  if the Company  applies to have the Common Stock traded on any
other Trading Market, it will include in such application all of the Shares, and
will take such  other  action as is  necessary  to cause all of the Shares to be
listed on such other  Trading  Market as promptly as possible.  The Company will
take all action  commercially  reasonable  and  necessary  to (a)  continue  the
listing  and trading of its Common  Stock on a Trading  Market and (b) comply in
all respects with the Company's  reporting,  filing and other  obligations under
the bylaws or rules of such Trading Market.

         4.11 DELIVERY OF SHARES AFTER CLOSING.  The Company shall  deliver,  or
cause to be delivered, the Shares purchased by Investor to Investor within three
(3) Trading Days of the Closing Date.

         4.12  CONSOLIDATION;  MERGER.  The Company  shall not during the period
commencing  on the date  hereof and  ending on the  Effective  Date,  effect any
merger or  consolidation  of the Company  with or into,  or a transfer of all or
substantially  all the assets of the Company to another entity (a "Consolidation
Event") unless the resulting  successor or acquiring entity (if not the Company)
assumes  by  written  instrument  the  Company's  obligations  pursuant  to this
Agreement.

                                       17
<PAGE>

                                   ARTICLE V.
                                  MISCELLANEOUS

         5.1 FEES AND  EXPENSES.  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
stamp  and other  taxes and  duties  levied in  connection  with the sale of the
Shares.

         5.2 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.

         5.3 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 with  confirmation  of
receipt at the facsimile number set forth on the signature pages attached hereto
prior to 6:30 p.m.  (California time) on a Trading Day, (b) the next Trading Day
after the date of transmission, if such notice or communication is delivered via
facsimile with  confirmation of receipt at the facsimile number set forth on the
signature pages attached hereto on a day that is not a Trading Day or later than
6:30 p.m.  (California  time) on any  Trading  Day,  (c) the second  Trading Day
following  the date of mailing,  if sent by a  nationally  recognized  overnight
courier service in the United States, 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.

         5.4 AMENDMENTS;  WAIVERS.  No provision of this Agreement may be waived
or amended except in a written  instrument  signed, in the case of an amendment,
by the  Company  and each  Investor  or, in the case of a  waiver,  by the party
against whom enforcement of any such waiver 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 either party to exercise  any right  hereunder in
any manner impair the exercise of any such right.

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

         5.6  SUCCESSORS AND ASSIGNS.  This Agreement  shall be binding upon and
inure to the benefit of the parties  hereto 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 Investor.  Any Investor may
assign any or all of its rights under this  Agreement to any Person to whom such
Investor  assigns or transfers any Shares,  provided such  transferee  agrees in
writing to be bound,  with respect to the transferred  Shares, by the provisions
hereof that apply to the "Investors."

                                       18
<PAGE>

         5.7 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 4.8.

         5.8 GOVERNING LAW. All questions concerning the construction, validity,
enforcement  and  interpretation  of this  Agreement  shall be  governed  by and
construed  and enforced in  accordance  with the  internal  laws of the State of
California,  without regard to the principles of conflicts of law thereof.  Each
party hereby irrevocably submits to the exclusive  jurisdiction of the state and
federal  courts  sitting in the  county of Santa  Barbara,  California,  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  inconvenient  venue for such
proceeding. Each party hereby irrevocably waives personal service of process and
consents  to process  being  served in any such suit,  action or  proceeding  by
mailing a copy thereof 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  manner
permitted  by law. The parties  hereby  waive all rights to a trial by jury.  If
either party shall commence an action or proceeding to enforce any provisions of
this Agreement,  then the prevailing party in such action or proceeding shall be
reimbursed by the other party for its reasonable attorneys fees and expenses and
other  costs and  expenses  incurred  with the  investigation,  preparation  and
prosecution of such action or proceeding.

         5.9 SURVIVAL.  The  representations and warranties herein shall survive
the Closing and delivery of the Shares until the third anniversary hereof.

         5.10  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,  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  signature  page
were an original thereof.

         5.11  SEVERABILITY.  If any  provision of this  Agreement is held to be
invalid or unenforceable in any respect,  the validity and enforceability of the
remaining  terms  and  provisions  of  this  Agreement  shall  not in any way be
affected or impaired  thereby and the parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor,  and upon so
agreeing, shall incorporate such substitute provision in this Agreement.

         5.12 RESCISSION AND WITHDRAWAL RIGHT.  Notwithstanding  anything to the
contrary  contained in (and  without  limiting  any similar  provisions  of) the
Transaction Documents, whenever any Investor exercises a right, election, demand
or option under a Transaction  Document and the Company does not timely  perform
its related obligations within the periods therein provided,  then such Investor

                                       19
<PAGE>

may rescind or withdraw,  in its sole  discretion from time to time upon written
notice to the Company,  any relevant  notice,  demand or election in whole or in
part without  prejudice to its future  actions and rights.

         5.13 REPLACEMENT OF SHARES. If any certificate or instrument evidencing
any Shares is mutilated,  lost, stolen or destroyed,  the Company shall issue or
cause to be  issued  in  exchange  and  substitution  for and upon  cancellation
thereof,  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  and  customary  and  reasonable
indemnity,  if requested.  The  applicants  for a new  certificate or instrument
under  such  circumstances  shall  also  pay any  reasonable  third-party  costs
associated with the issuance of such replacement Shares.

         5.14  REMEDIES.  In addition to being  entitled to exercise  all rights
provided herein or granted by law,  including  recovery of damages,  each of the
Investors  and the Company  will be entitled to specific  performance  under the
Transaction  Documents.  The  parties  agree that  monetary  damages  may not be
adequate  compensation  for  any  loss  incurred  by  reason  of any  breach  of
obligations  described in the  foregoing  sentence and hereby agrees to waive in
any action for specific  performance  of any such  obligation the defense that a
remedy at law would be adequate.

         5.15 PAYMENT SET ASIDE.  To the extent that the Company makes a payment
or payments to any Investor  pursuant to any Transaction  Document or a Investor
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.

         5.16 LIQUIDATED DAMAGES.  The Company's  obligations to pay any partial
liquidated  damages or other amounts owing under the Transaction  Documents is a
continuing  obligation of the Company and shall not  terminate  until all unpaid
partial liquidated damages and other amounts have been paid  notwithstanding the
fact that the instrument or security  pursuant to which such partial  liquidated
damages or other amounts are due and payable shall have been canceled.

                            (Signature Pages Follow)

                                       20
<PAGE>

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

ROAMING MESSENGER, INC.                               Address for Notice:
                                                      ------------------

By:      _________________________________            50 Castilian Drive
         Name:                                        Suite A
         Title:                                       Santa Barbara, CA 93117

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

SICHENZIA ROSS FRIEDMAN FERENCE LLP
1065 Avenue of the Americas
New York, New York  10018
Tel:   (212) 930-9700
Fax:   (212) 930-9725

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                      SIGNATURE PAGES FOR INVESTORS FOLLOW]

                                       21
<PAGE>

             [INVESTOR SIGNATURE PAGES TO SHARES PURCHASE AGREEMENT]

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

Name of Investing Entity: Wings Fund, Inc.
Signature of Authorized Signatory of Investing Entity: _________________________
Name of Authorized Signatory: James L. Bartlett III
Title of Authorized Signatory: __________________________

Address for Notice of Investing Entity:

Wings Fund, Inc.
5662 Calle Real #115
Santa Barbara, CA 93117

Address for Delivery of Shares for Investing Entity (if not same as above):

Subscription Amount:  $500,000
Shares: 5,000,000
EIN Number:

                           [SIGNATURE PAGES CONTINUE]

                                       22

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