Document:

INTELLECTUAL
      PROPERTY SECURITY AGREEMENT

    

    INTELLECTUAL
      PROPERTY SECURITY AGREEMENT (this
      “Agreement”
      dated as
      of November 30,
      2006,
      by and
      among Skreem Entertainment Corporation, a Delaware corporation (the
“Company”),
      and
      the secured parties signatory hereto and their respective endorsees, transferees
      and assigns (collectively, the “Secured
      Party”).

    

    WITNESSETH
      :

    

    WHEREAS,
      pursuant to a Securities Purchase Agreement, dated the date hereof, between
      Company and the Secured Party (the “Purchase
      Agreement”),
      Company has agreed to issue to the Secured Party and the Secured Party has
      agreed to purchase from Company certain of Company’s 8% Callable Secured
      Convertible Notes, due three years from the date of issue (the “Notes”),
      which
      are convertible into shares of Company’s Common Stock, par value $.001 per share
      (the “Common
      Stock”).
      In
      connection therewith, Company shall issue the Secured Party certain Common
      Stock
      purchase warrants (the “Warrants”);
      and

    

    WHEREAS,
      in order to induce the Secured Party to purchase the Notes, Company has agreed
      to execute and deliver to the Secured Party this Agreement for the benefit
      of
      the Secured Party and to grant to it a first priority security interest in
      certain Intellectual Property (defined below) of Company to secure the prompt
      payment, performance and discharge in full of all of Company’s obligations under
      the Notes and exercise and discharge in full of Company’s obligations under the
      Warrants; and

    

    NOW,
      THEREFORE, in consideration of the agreements herein contained and for other
      good and valuable consideration, the receipt and sufficiency of which is hereby
      acknowledged, the parties hereto hereby agree as follows:

    

    1. Defined
      Terms.
      Unless
      otherwise defined herein, terms which are defined in the Purchase Agreement
      and
      used herein are so used as so defined; and the following terms shall have the
      following meanings:

    

    “Software
      Intellectual Property”
shall
      mean:

    

    (a) all
      software programs (including all source code, object code and all related
      applications and data files), whether now owned, upgraded, enhanced, licensed
      or
      leased or hereafter acquired by the Company, above;

    

    (b) all
      computers and electronic data processing hardware and firmware associated
      therewith;

    

    (c) all
      documentation (including flow charts, logic diagrams, manuals, guides and
      specifications) with respect to such software, hardware and firmware described
      in the preceding clauses (a) and (b); and

    

    (d) all
      rights with respect to all of the foregoing, including, without limitation,
      any
      and all upgrades, modifications, copyrights, licenses, options, warranties,
      service contracts, program services, test rights, maintenance rights, support
      rights, improvement rights, renewal rights and indemnifications and
      substitutions, replacements, additions, or model conversions of any of the
      foregoing.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Copyrights”
shall
      mean (a) all copyrights, registrations and applications for registration,
issued
      or
      filed, including any reissues, extensions or renewals thereof, by or with the
      United States Copyright Office or any similar office or agency of the United
      States, any state thereof, or any other country or political subdivision
      thereof, or otherwise, including, all rights in and to the material constituting
      the subject matter thereof, including, without limitation, any referred to
      in
Schedule
      B
      hereto,
      and (b) any rights in any material which is copyrightable or which is protected
      by common law, United States copyright laws or similar laws or any law of any
      State, including, without limitation, any thereof referred to in Schedule
      B
      hereto.

    

    “Copyright
      License”
shall
      mean any agreement, written or oral, providing for a grant by the Company of
      any
      right in any Copyright, including, without limitation, any thereof referred
      to
      in Schedule
      B
      hereto.

    

    “Intellectual
      Property”
shall
      means, collectively, the Software Intellectual Property, Copyrights, Copyright
      Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses and Trade
      Secrets.

    

    “Obligations”
means
      all of the Company’s obligations under this Agreement and the Notes, in each
      case, whether now or hereafter existing, voluntary or involuntary, direct or
      indirect, absolute or contingent, liquidated or unliquidated, whether or not
      jointly owed with others, and whether or not from time to time decreased or
      extinguished and later decreased, created or incurred, and all or any portion
      of
      such obligations or liabilities that are paid, to the extent all or any part
      of
      such payment is avoided or recovered directly or indirectly from the Secured
      Party as a preference, fraudulent transfer or otherwise as such obligations
      may
      be amended, supplemented, converted, extended or modified from time to
      time.

     

    “Patents”
shall
      mean (a) all letters patent of the United States or any other country or any
      political subdivision thereof, and all reissues and extensions thereof,
      including, without limitation, any thereof referred to in Schedule
      B
      hereto,
      and (b) all applications for letters patent of the United States and all
      divisions, continuations and continuations-in-part thereof or any other country
      or any political subdivision, including, without limitation, any thereof
      referred to in Schedule
      B
      hereto.

    

    “Patent
      License”
shall
      mean all agreements, whether written or oral, providing for the grant by the
      Company of any right to manufacture, use or sell any invention covered by a
      Patent, including, without limitation, any thereof referred to in Schedule
      B
      hereto.

    

    “Security
      Agreement”
shall
      mean the a Security Agreement, dated the date hereof between Company and the
      Secured Party.

    

    “Trademarks”
shall
      mean (a) all trademarks, trade names, corporate names, company names, business
      names, fictitious business names, trade styles, service marks, logos and other
      source or business identifiers, and the goodwill associated therewith, now
      existing or hereafter adopted or acquired, all registrations and recordings
      thereof, and all applications in connection therewith, whether in the United
      States Patent and Trademark Office or in any similar office or agency of the
      United States, any state thereof or any other country or any political
      subdivision thereof, or otherwise, including, without limitation, any thereof
      referred to in Schedule
      B
      hereto,
      and (b) all reissues, extensions or renewals thereof.

    

    
      
        
        

      

      
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    “Trademark
      License”
shall
      mean any agreement, written or oral, providing for the grant by the Company
      of
      any right to use any Trademark, including, without limitation, any thereof
      referred to in Schedule
      B
      hereto.

    

    “Trade
      Secrets”
shall
      mean common law and statutory trade secrets and all other confidential or
      proprietary or useful information and all know-how obtained by or used in or
      contemplated at any time for use in the business of the Company (all of the
      foregoing being collectively called a “Trade
      Secret”),
      whether or not such Trade Secret has been reduced to a writing or other tangible
      form, including all documents and things embodying, incorporating or referring
      in any way to such Trade Secret, all Trade Secret licenses, including each
      Trade
      Secret license referred to in Schedule
      B
      hereto,
      and including the right to sue for and to enjoin and to collect damages for
      the
      actual or threatened misappropriation of any Trade Secret and for the breach
      or
      enforcement of any such Trade Secret license.

    

    2. Grant
      of Security Interest.
      In
      accordance with Section 3(m) of the Security Agreement, to secure the complete
      and timely payment, performance and discharge in full, as the case may be,
      of
      all of the Obligations, the Company hereby, unconditionally and irrevocably,
      pledges, grants and hypothecates to the Secured Party, a continuing security
      interest in, a continuing first lien upon, an unqualified right to possession
      and disposition of and a right of set-off against, in each case to the fullest
      extent permitted by law, all of the Company’s right, title and interest of
      whatsoever kind and nature in and to the Intellectual Property (the
“Security
      Interest”).

    

    3. Representations
      and Warranties.
      The
      Company hereby represents and warrants, and covenants and agrees with, the
      Secured Party as follows:

    

    (a) The
      Company has the requisite corporate power and authority to enter into this
      Agreement and otherwise to carry out its obligations thereunder. The execution,
      delivery and performance by the Company of this Agreement and the filings
      contemplated therein have been duly authorized by all necessary action on the
      part of the Company and no further action is required by the Company. This
      Agreement constitutes a legal, valid and binding obligation of the Company
      enforceable in accordance with its terms, except as enforceability may be
      limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
      affecting the enforcement of creditor’s rights generally.

    

    (b) The
      Company represents and warrants that it has no place of business or offices
      where its respective books of account and records are kept (other than
      temporarily at the offices of its attorneys or accountants) or places where
      the
      Intellectual Property is stored or located, except as set forth on Schedule
      A
      attached
      hereto;

    

    (c) The
      Company is the sole owner of the Intellectual Property (except for non-exclusive
      licenses granted by the Company in the ordinary course of business), free and
      clear of any liens, security interests, encumbrances, rights or claims, and
      is
      fully authorized to grant the Security Interest in and to pledge the
      Intellectual Property, except as set forth on Schedule
      D.
      There
      is not on file in any governmental or regulatory authority, agency or recording
      office an effective financing statement, security agreement, license or transfer
      or any notice of any of the foregoing (other than those that have been filed
      in
      favor of the Secured Party pursuant to this Agreement) covering or affecting
      any
      of the Intellectual Property, except as set forth on Schedule
      D.
      So long
      as this Agreement shall be in effect, the Company shall not execute and shall
      not knowingly permit to be on file in any such office or agency any such
      financing statement or other document or instrument (except to the extent filed
      or recorded in favor of the Secured Party pursuant to the terms of this
      Agreement), except as set forth on Schedule
      D or
      for a
      financing statement covering assets acquired by the Company after the date
      hereof, provided that the value of the Intellectual Property covered by this
      Agreement along with the Collateral (as defined in the Security Agreement)
      is
      equal to at least 150% of the Obligations.

    

    
      
        
        

      

      
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    (d) The
      Company shall at all times maintain its books of account and records relating
      to
      the Intellectual Property at its principal place of business and its
      Intellectual Property at the locations set forth on Schedule
      A
      attached
      hereto and may not relocate such books of account and records unless it delivers
      to the Secured Party at least 30 days prior to such relocation (i) written
      notice of such relocation and the new location thereof (which must be within
      the
      United States) and (ii) evidence that the necessary documents have been
      filed and recorded and other steps have been taken to perfect the Security
      Interest to create in favor of the Secured Party valid, perfected and continuing
      first priority liens in the Intellectual Property to the extent they can be
      perfected through such filings.

    

    (e) This
      Agreement creates in favor of the Secured Party a valid security interest in
      the
      Intellectual Property securing the payment and performance of the Obligations
      and, upon making the filings required hereunder, a perfected first priority
      security interest in such Intellectual Property to the extent that it can be
      perfected through such filings.

    

    (f) 
      Upon
      request of the Secured Party, the Company shall execute and deliver any and
      all
      agreements, instruments, documents, and papers as the Secured Party may request
      to evidence the Secured Party’s security interest in the Intellectual Property
      and the goodwill and general intangibles of the Company relating thereto or
      represented thereby, and the Company hereby appoints the Secured Party its
      attorney-in-fact to execute and file all such writings for the foregoing
      purposes, all acts of such attorney being hereby ratified and confirmed; such
      power being coupled with an interest is irrevocable until the Obligations have
      been fully satisfied and are paid in full.

    

    (g) Except
      as
      set forth on Schedule
      D,
      the
      execution, delivery and performance of this Agreement does not conflict with
      or
      cause a breach or default, or an event that with or without the passage of
      time
      or notice, shall constitute a breach or default, under any agreement to which
      the Company is a party or by which the Company is bound. No consent (including,
      without limitation, from stock holders or creditors of the Company) is required
      for the Company to enter into and perform its obligations
      hereunder.

    

    (h) The
      Company shall at all times maintain the liens and Security Interest provided
      for
      hereunder as valid and perfected first priority liens and security interests
      in
      the Intellectual Property to the extent they can be perfected by filing in
      favor
      of the Secured Party until this Agreement and the Security Interest hereunder
      shall terminate pursuant to Section 11. The Company hereby agrees to defend
      the
      same against any and all persons. The Company shall safeguard and protect all
      Intellectual Property for the account of the Secured Party. Without limiting
      the
      generality of the foregoing, the Company shall pay all fees, taxes and other
      amounts necessary to maintain the Intellectual Property and the Security
      Interest hereunder, and the Company shall obtain and furnish to the Secured
      Party from time to time, upon demand, such releases and/or subordinations of
      claims and liens which may be required to maintain the priority of the Security
      Interest hereunder. 

    

    
      
        
        

      

      
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    (i) The
      Company will not transfer, pledge, hypothecate, encumber, license (except for
      non-exclusive licenses granted by the Company in the ordinary course of
      business), sell or otherwise dispose of any of the Intellectual Property without
      the prior written consent of the Secured Party, which consent will not be
      unreasonably withheld.

    

    (j) The
      Company shall, within ten (10) days of obtaining knowledge thereof, advise
      the
      Secured Party promptly, in sufficient detail, of any substantial change in
      the
      Intellectual Property, and of the occurrence of any event which would have
      a
      material adverse effect on the value of the Intellectual Property or on the
      Secured Party’s security interest therein.

    

    (k) The
      Company shall permit the Secured Party and its representatives and agents to
      inspect the Intellectual Property at any time, and to make copies of records
      pertaining to the Intellectual Property as may be requested by the Secured
      Party
      from time to time.

    

    (l) The
      Company will take all steps reasonably necessary to diligently pursue and seek
      to preserve, enforce and collect any rights, claims, causes of action and
      accounts receivable in respect of the Intellectual Property.

    

    (m) The
      Company shall promptly notify the Secured Party in sufficient detail upon
      becoming aware of any attachment, garnishment, execution or other legal process
      levied against any Intellectual Property and of any other information received
      by the Company that may materially affect the value of the Intellectual
      Property, the Security Interest or the rights and remedies of the Secured Party
      hereunder.

    

    (n) All
      information heretofore, herein or hereafter supplied to the Secured Party by
      or
      on behalf of the Company with respect to the Intellectual Property is accurate
      and complete in all material respects as of the date furnished.

    

    (o) Schedule
      A
      attached
      hereto contains a list of all of the subsidiaries of Company.

    

    (p) Schedule
      B
      attached
      hereto includes all Licenses, and all Patents and Patent Licenses, if any,
      owned
      by the Company in its own name as of the date hereof. Schedule
      B
      hereto
      includes all Trademarks and Trademark Licenses, if any, owned by the Company
      in
      its own name as of the date hereof. Schedule
      B
      hereto
      includes all Copyrights and Copyright Licenses, if any, owned by the Company
      in
      its own name as of the date hereof. Schedule
      B
      hereto
      includes all Trade Secrets and Trade Secret Licenses, if any, owned by the
      Company as of the date hereof. To the best of the Company’s knowledge, each
      License, Patent, Trademark, Copyright and Trade Secret is valid, subsisting,
      unexpired, enforceable and has not been abandoned. Except as set forth in
Schedule
      B,
      none of
      such Licenses, Patents, Trademarks, Copyrights and Trade Secrets is the subject
      of any licensing or franchise agreement. To the best of the Company’s knowledge,
      no holding, decision or judgment has been rendered by any Governmental Body
      which would limit, cancel or question the validity of any License, Patent,
      Trademark, Copyright and Trade Secrets . Except as set forth in Schedule
      B,
      no
      action or proceeding is pending (i) seeking to limit, cancel or question the
      validity of any License, Patent, Trademark, Copyright or Trade Secret, or (ii)
      which, if adversely determined, would have a material adverse effect on the
      value of any License, Patent, Trademark, Copyright or Trade Secret. The Company
      has used and will continue to use for the duration of this Agreement, proper
      statutory notice in connection with its use of the Patents, Trademarks and
      Copyrights and consistent standards of quality in products leased or sold under
      the Patents, Trademarks and Copyrights.

    

    
      
        
        

      

      
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    (q) With
      respect to any Intellectual Property:

    

    
      	 	
              (i)

            	
              such
                Intellectual Property is subsisting and has not been adjudged invalid
                or
                unenforceable, in whole or in part;

            

    

    

    
      	 	
              (ii)

            	
              such
                Intellectual Property is valid and
                enforceable;

            

    

    

    
      	 	
              (iii)

            	
              the
                Company has made all necessary filings and recordations to protect
                its
                interest in such Intellectual Property, including, without limitation,
                recordations of all of its interests in the Patents, Patent Licenses,
                Trademarks and Trademark Licenses in the United States Patent and
                Trademark Office and in corresponding offices throughout the world
                and its
                claims to the Copyrights and Copyright Licenses in the United States
                Copyright Office and in corresponding offices throughout the
                world;

            

    

    

    
      	 	
              (iv)

            	
              other
                than as set forth in Schedule
                B,
                the Company is the exclusive owner of the entire and unencumbered
                right,
                title and interest in and to such Intellectual Property and no claim
                has
                been made that the use of such Intellectual Property infringes on
                the
                asserted rights of any third party;
                and

            

    

    

    
      	 	
              (v)

            	
              the
                Company has performed and will continue to perform all acts and has
                paid
                all required fees and taxes to maintain each and every item of
                Intellectual Property in full force and effect throughout the world,
                as
                applicable.

            

    

    

    (r) Except
      with respect to any Trademark or Copyright that the Company shall reasonably
      determine is of negligible economic value to the Company, the Company
      shall:

    

    (i) maintain
      each Trademark and Copyright in full force free from any claim of abandonment
      for non-use, maintain as in the past the quality of products and services
      offered under such Trademark or Copyright; employ such Trademark or Copyright
      with the appropriate notice of registration; not adopt or use any mark which
      is
      confusingly similar or a colorable imitation of such Trademark or Copyright
      unless the Secured Party shall obtain a perfected security interest in such
      mark
      pursuant to this Agreement; and not (and not permit any licensee or sublicensee
      thereof to) do any act or knowingly omit to do any act whereby any Trademark
      or
      Copyright may become invalidated;

    

    (ii) not,
      except with respect to any Patent that it shall reasonably determine is of
      negligible economic value to it, do any act, or omit to do any act, whereby
      any
      Patent may become abandoned or dedicated; and

    

    
      
        
        

      

      
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    (iii) notify
      the Secured Party immediately if it knows, or has reason to know, that any
      application or registration relating to any Patent, Trademark or Copyright
      may
      become abandoned or dedicated, or of any adverse determination or development
      (including, without limitation, the institution of, or any such determination
      or
      development in, any proceeding in the United States Patent and Trademark Office,
      United States Copyright Office or any court or tribunal in any country)
      regarding its ownership of any Patent, Trademark or Copyright or its right
      to
      register the same or to keep and maintain the same.

    

    (s) Whenever
      the Company, either by itself or through any agent, employee, licensee or
      designee, shall file an application for the registration of any Patent,
      Trademark or Copyright with the United States Patent and Trademark Office,
      United States Copyright Office or any similar office or agency in any other
      country or any political subdivision thereof or acquire rights to any new
      Patent, Trademark or Copyright whether or not registered, report such filing
      to
      the Secured Party within five business days after the last day of the fiscal
      quarter in which such filing occurs.

    

    (t) The
      Company shall take all reasonable and necessary steps, including, without
      limitation, in any proceeding before the United States Patent and Trademark
      Office, United States Copyright Office or any similar office or agency in any
      other country or any political subdivision thereof, to maintain and pursue
      each
      application (and to obtain the relevant registration) and to maintain each
      registration of the Patents, Trademarks and Copyrights, including, without
      limitation, filing of applications for renewal, affidavits of use and affidavits
      of incontestability.

    

    (u) In
      the
      event that any Patent, Trademark or Copyright included in the Intellectual
      Property is infringed, misappropriated or diluted by a third party, promptly
      notify the Secured Party after it learns thereof and shall, unless it shall
      reasonably determine that such Patent, Trademark or Copyright is of negligible
      economic value to it, which determination it shall promptly report to the
      Secured Party, promptly sue for infringement, misappropriation or dilution,
      to
      seek injunctive relief where appropriate and to recover any and all damages
      for
      such infringement, misappropriation or dilution, or take such other actions
      as
      it shall reasonably deem appropriate under the circumstances to protect such
      Patent, Trademark or Copyright. If the Company lacks the financial resources
      to
      comply with this Section 3(t), the Company shall so notify the Secured Party
      and
      shall cooperate fully with any enforcement action undertaken by the Secured
      Party on behalf of the Company.

    

    4. Defaults.
      The
      following events shall be “Events
      of Default”:

    

    (a) The
      occurrence of an Event of Default (as defined in the Notes) under the
      Notes;

    

    (b) Any
      representation or warranty of the Company in this Agreement or in the Security
      Agreement shall prove to have been incorrect in any material respect when made;
      

    

    (c) The
      failure by the Company to observe or perform any of its obligations hereunder
      or
      in the Security Agreement for ten (10) days after receipt by the Company of
      notice of such failure from the Secured Party; and

    

    
      
        
        

      

      
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    (d) Any
      breach of, or default under, the Warrants.

    

    5. Duty
      To Hold In Trust.
      Upon
      the occurrence of any Event of Default and at any time thereafter, the Company
      shall, upon receipt by it of any revenue, income or other sums subject to the
      Security Interest, whether payable pursuant to the Notes or otherwise, or of
      any
      check, draft, note, trade acceptance or other instrument evidencing an
      obligation to pay any such sum, hold the same in trust for the Secured Party
      and
      shall forthwith endorse and transfer any such sums or instruments, or both,
      to
      the Secured Party for application to the satisfaction of the
      Obligations.

    

    6. Rights
      and Remedies Upon Default.
      Upon
      occurrence of any Event of Default and at any time thereafter, the Secured
      Party
      shall have the right to exercise all of the remedies conferred hereunder and
      under the Notes, and the Secured Party shall have all the rights and remedies
      of
      a secured party under the UCC and/or any other applicable law (including the
      Uniform Commercial Code of any jurisdiction in which any Intellectual Property
      is then located). Without limitation, the Secured Party shall have the following
      rights and powers:

    

    (a) The
      Secured Party shall have the right to take possession of the Intellectual
      Property and, for that purpose, enter, with the aid and assistance of any
      person, any premises where the Intellectual Property, or any part thereof,
      is or
      may be placed and remove the same, and the Company shall assemble the
      Intellectual Property and make it available to the Secured Party at places
      which
      the Secured Party shall reasonably select, whether at the Company’s premises or
      elsewhere, and make available to the Secured Party, without rent, all of the
      Company’s respective premises and facilities for the purpose of the Secured
      Party taking possession of, removing or putting the Intellectual Property in
      saleable or disposable form.

    

    (b) The
      Secured Party shall have the right to operate the business of the Company using
      the Intellectual Property and shall have the right to assign, sell, lease or
      otherwise dispose of and deliver all or any part of the Intellectual Property,
      at public or private sale or otherwise, either with or without special
      conditions or stipulations, for cash or on credit or for future delivery, in
      such parcel or parcels and at such time or times and at such place or places,
      and upon such terms and conditions as the Secured Party may deem commercially
      reasonable, all without (except as shall be required by applicable statute
      and
      cannot be waived) advertisement or demand upon or notice to the Company or
      right
      of redemption of the Company, which are hereby expressly waived. Upon each
      such
      sale, lease, assignment or other transfer of Intellectual Property, the Secured
      Party may, unless prohibited by applicable law which cannot be waived, purchase
      all or any part of the Intellectual Property being sold, free from and
      discharged of all trusts, claims, right of redemption and equities of the
      Company, which are hereby waived and released.

    

    7. Applications
      of Proceeds.
      The
      proceeds of any such sale, lease or other disposition of the Intellectual
      Property hereunder shall be applied first, to the expenses of retaking, holding,
      storing, processing and preparing for sale, selling, and the like (including,
      without limitation, any taxes, fees and other costs incurred in connection
      therewith) of the Intellectual Property, to the reasonable attorneys’ fees and
      expenses incurred by the Secured Party in enforcing its rights hereunder and
      in
      connection with collecting, storing and disposing of the Intellectual Property,
      and then to satisfaction of the Obligations, and to the payment of any other
      amounts required by applicable law, after which the Secured Party shall pay
      to
      the Company any surplus proceeds. If, upon the sale, license or other
      disposition of the Intellectual Property, the proceeds thereof are insufficient
      to pay all amounts to which the Secured Party is legally entitled, the Company
      will be liable for the deficiency, together with interest thereon, at the rate
      of 15% per annum (the “Default
      Rate”),
      and
      the reasonable fees of any attorneys employed by the Secured Party to collect
      such deficiency. To the extent permitted by applicable law, the Company waives
      all claims, damages and demands against the Secured Party arising out of the
      repossession, removal, retention or sale of the Intellectual Property, unless
      due to the gross negligence or willful misconduct of the Secured
      Party.

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    8. Costs
      and Expenses. The
      Company agrees to pay all out-of-pocket fees, costs and expenses incurred in
      connection with any filing required hereunder, including without limitation,
      any
      financing statements, continuation statements, partial releases and/or
      termination statements related thereto or any expenses of any searches
      reasonably required by the Secured Party. The Company shall also pay all other
      claims and charges which in the reasonable opinion of the Secured Party might
      prejudice, imperil or otherwise affect the Intellectual Property or the Security
      Interest therein. The Company will also, upon demand, pay to the Secured Party
      the amount of any and all reasonable expenses, including the reasonable fees
      and
      expenses of its counsel and of any experts and agents, which the Secured Party
      may incur in connection with (i) the enforcement of this Agreement, (ii) the
      custody or preservation of, or the sale of, collection from, or other
      realization upon, any of the Intellectual Property, or (iii) the exercise or
      enforcement of any of the rights of the Secured Party under the Notes. Until
      so
      paid, any fees payable hereunder shall be added to the principal amount of
      the
      Notes and shall bear interest at the Default Rate.

    

    9. Responsibility
      for Intellectual Property.
      The
      Company assumes all liabilities and responsibility in connection with all
      Intellectual Property, and the obligations of the Company hereunder or under
      the
      Notes and the Warrants shall in no way be affected or diminished by reason
      of
      the loss, destruction, damage or theft of any of the Intellectual Property
      or
      its unavailability for any reason. 

    

    10. Security
      Interest Absolute.
      All
      rights of the Secured Party and all Obligations of the Company hereunder, shall
      be absolute and unconditional, irrespective of: (a) any lack of validity or
      enforceability of this Agreement, the Notes, the Warrants or any agreement
      entered into in connection with the foregoing, or any portion hereof or thereof;
      (b) any change in the time, manner or place of payment or performance of, or
      in
      any other term of, all or any of the Obligations, or any other amendment or
      waiver of or any consent to any departure from the Notes, the Warrants or any
      other agreement entered into in connection with the foregoing; (c) any exchange,
      release or nonperfection of any of the Intellectual Property, or any release
      or
      amendment or waiver of or consent to departure from any other Intellectual
      Property for, or any guaranty, or any other security, for all or any of the
      Obligations; (d) any action by the Secured Party to obtain, adjust, settle
      and
      cancel in its sole discretion any insurance claims or matters made or arising
      in
      connection with the Intellectual Property; or (e) any other circumstance which
      might otherwise constitute any legal or equitable defense available to the
      Company, or a discharge of all or any part of the Security Interest granted
      hereby. Until the Obligations shall have been paid and performed in full, the
      rights of the Secured Party shall continue even if the Obligations are barred
      for any reason, including, without limitation, the running of the statute of
      limitations or bankruptcy. The Company expressly waives presentment, protest,
      notice of protest, demand, notice of nonpayment and demand for performance.
      In
      the event that at any time any transfer of any Intellectual Property or any
      payment received by the Secured Party hereunder shall be deemed by final order
      of a court of competent jurisdiction to have been a voidable preference or
      fraudulent conveyance under the bankruptcy or insolvency laws of the United
      States, or shall be deemed to be otherwise due to any party other than the
      Secured Party, then, in any such event, the Company’s obligations hereunder
      shall survive cancellation of this Agreement, and shall not be discharged or
      satisfied by any prior payment thereof and/or cancellation of this Agreement,
      but shall remain a valid and binding obligation enforceable in accordance with
      the terms and provisions hereof. The Company waives all right to require the
      Secured Party to proceed against any other person or to apply any Intellectual
      Property which the Secured Party may hold at any time, or to marshal assets,
      or
      to pursue any other remedy. The Company waives any defense arising by reason
      of
      the application of the statute of limitations to any obligation secured
      hereby.

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    11. Term
      of Agreement.
      This
      Agreement and the Security Interest shall terminate on the date on which all
      payments under the Notes have been made in full and all other Obligations have
      been paid or discharged. Upon such termination, the Secured Party, at the
      request and at the expense of the Company, will join in executing any
      termination statement with respect to any financing statement executed and
      filed
      pursuant to this Agreement. 

    

    12. Power
      of Attorney; Further Assurances.

    

    (a) The
      Company authorizes the Secured Party, and does hereby make, constitute and
      appoint it, and its respective officers, agents, successors or assigns with
      full
      power of substitution, as the Company’s true and lawful attorney-in-fact, with
      power, in its own name or in the name of the Company, to, after the occurrence
      and during the continuance of an Event of Default, (i) endorse any notes,
      checks, drafts, money orders, or other instruments of payment (including
      payments payable under or in respect of any policy of insurance) in respect
      of
      the Intellectual Property that may come into possession of the Secured Party;
      (ii) to sign and endorse any UCC financing statement or any invoice, freight
      or
      express bill, bill of lading, storage or warehouse receipts, drafts against
      debtors, assignments, verifications and notices in connection with accounts,
      and
      other documents relating to the Intellectual Property; (iii) to pay or discharge
      taxes, liens, security interests or other encumbrances at any time levied or
      placed on or threatened against the Intellectual Property; (iv) to demand,
      collect, receipt for, compromise, settle and sue for monies due in respect
      of
      the Intellectual Property; and (v) generally, to do, at the option of the
      Secured Party, and at the Company’s expense, at any time, or from time to time,
      all acts and things which the Secured Party deems necessary to protect, preserve
      and realize upon the Intellectual Property and the Security Interest granted
      therein in order to effect the intent of this Agreement, the Notes and the
      Warrants, all as fully and effectually as the Company might or could do; and
      the
      Company hereby ratifies all that said attorney shall lawfully do or cause to
      be
      done by virtue hereof. This power of attorney is coupled with an interest and
      shall be irrevocable for the term of this Agreement and thereafter as long
      as
      any of the Obligations shall be outstanding.

    

    (b) On
      a
      continuing basis, the Company will make, execute, acknowledge, deliver, file
      and
      record, as the case may be, in the proper filing and recording places in any
      jurisdiction, including, without limitation, the jurisdictions indicated on
      Schedule
      C,
      attached hereto, all such instruments, and take all such action as may
      reasonably be deemed necessary or advisable, or as reasonably requested by
      the
      Secured Party, to perfect the Security Interest granted hereunder and otherwise
      to carry out the intent and purposes of this Agreement, or for assuring and
      confirming to the Secured Party the grant or perfection of a security interest
      in all the Intellectual Property.

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

    (c) The
      Company hereby irrevocably appoints the Secured Party as the Company’s
      attorney-in-fact, with full authority in the place and stead of the Company
      and
      in the name of the Company, from time to time in the Secured Party’s discretion,
      to take any action and to execute any instrument which the Secured Party may
      deem necessary or advisable to accomplish the purposes of this Agreement,
      including the filing, in its sole discretion, of one or more financing or
      continuation statements and amendments thereto, relative to any of the
      Intellectual Property without the signature of the Company where permitted
      by
      law.

    

    13. Notices.
      All
      notices, requests, demands and other communications hereunder shall be in
      writing, with copies to all the other parties hereto, and shall be deemed to
      have been duly given when (i) if delivered by hand, upon receipt, (ii) if sent
      by facsimile, upon receipt of proof of sending thereof, (iii) if sent by
      nationally recognized overnight delivery service (receipt requested), the next
      business day or (iv) if mailed by first-class registered or certified mail,
      return receipt requested, postage prepaid, four days after posting in the U.S.
      mails, in each case if delivered to the following addresses:

    

    
      	If
              to the Company:	
              Skreem
                Entertainment Corporation

            

    

    11637
      Orpington Street 

    Orlando,
      Florida 32817

    Attention:
      Chief Executive Officer

    Telephone:
      407-207-0400

    Facsimile:
      407-207-0434

    

    
      	With
              a copy to:	
              Sichenzia
                Ross Friedman Ference LLP

            

    

    1065
      Avenue of the Americas

    New
      York,
      NY 10018

    Attention:
      Gregory Sichenzia, Esq.

    Telephone:
      (212) 930-9700

    Facsimile:
      (212) 930-9725

    

    
      	If
              to the Secured Party:	
              AJW
                Partners, LLC

            

      	 	AJW Offshore,
              Ltd. 

      	 	AJW Qualified Partners,
              LLC 

      	 	New Millennium Capital Partners, II,
              LLC 

      	 	1044 Northern
              Boulevard 

      	 	Suite 302 

      	 	Roslyn, New York
              11576 

      	 	Attention: Corey
              Ribotsky 

      	 	Facsimile:
              516-739-7115 

    

     

    
      	With
              copies to:	
              Ballard
                Spahr Andrews & Ingersoll, LLP

            

    

    1735
      Market Street, 51st
      Floor

    Philadelphia,
      Pennsylvania 19103

    Attention:
      Gerald J. Guarcini, Esquire

    Facsimile:
      215-864-8999

    

    14. Other
      Security.
      To the
      extent that the Obligations are now or hereafter secured by property other
      than
      the Intellectual Property or by the guarantee, endorsement or property of any
      other person, firm, corporation or other entity, then the Secured Party shall
      have the right, in its sole discretion, to pursue, relinquish, subordinate,
      modify or take any other action with respect thereto, without in any way
      modifying or affecting any of the Secured Party’s rights and remedies
      hereunder.

    

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    15. Miscellaneous.

    

    (a) No
      course
      of dealing between the Company and the Secured Party, nor any failure to
      exercise, nor any delay in exercising, on the part of the Secured Party, any
      right, power or privilege hereunder or under the Notes shall operate as a waiver
      thereof; nor shall any single or partial exercise of any right, power or
      privilege hereunder or thereunder preclude any other or further exercise thereof
      or the exercise of any other right, power or privilege.

    

    (b) All
      of
      the rights and remedies of the Secured Party with respect to the Intellectual
      Property, whether established hereby or by the Notes or by any other agreements,
      instruments or documents or by law shall be cumulative and may be exercised
      singly or concurrently.

    

    (c) This
      Agreement and the Security Agreement constitute the entire agreement of the
      parties with respect to the subject matter hereof and is intended to supersede
      all prior negotiations, understandings and agreements with respect thereto.
      Except as specifically set forth in this Agreement, no provision of this
      Agreement may be modified or amended except by a written agreement specifically
      referring to this Agreement and signed by the parties hereto.

    

    (d) In
      the
      event that any provision of this Agreement is held to be invalid, prohibited
      or
      unenforceable in any jurisdiction for any reason, unless such provision is
      narrowed by judicial construction, this Agreement shall, as to such
      jurisdiction, be construed as if such invalid, prohibited or unenforceable
      provision had been more narrowly drawn so as not to be invalid, prohibited
      or
      unenforceable. If, notwithstanding the foregoing, any provision of this
      Agreement is held to be invalid, prohibited or unenforceable in any
      jurisdiction, such provision, as to such jurisdiction, shall be ineffective
      to
      the extent of such invalidity, prohibition or unenforceability without
      invalidating the remaining portion of such provision or the other provisions
      of
      this Agreement and without affecting the validity or enforceability of such
      provision or the other provisions of this Agreement in any other
      jurisdiction.

    

    (e) No
      waiver
      of any breach or default or any right under this Agreement shall be considered
      valid unless in writing and signed by the party giving such waiver, and no
      such
      waiver shall be deemed a waiver of any subsequent breach or default or right,
      whether of the same or similar nature or otherwise.

    

    (f) This
      Agreement shall be binding upon and inure to the benefit of each party hereto
      and its successors and assigns.

    

    (g) Each
      party shall take such further action and execute and deliver such further
      documents as may be necessary or appropriate in order to carry out the
      provisions and purposes of this Agreement.

    

    (h) This
      Agreement shall be construed in accordance with the laws of the State of New
      York, except to the extent the validity, perfection or enforcement of a security
      interest hereunder in respect of any particular Intellectual Property which
      are
      governed by a jurisdiction other than the State of New York in which case such
      law shall govern. Each of the parties hereto irrevocably submit to the exclusive
      jurisdiction of any New York State or United States Federal court sitting in
      Manhattan county over any action or proceeding arising out of or relating to
      this Agreement, and the parties hereto hereby irrevocably agree that all claims
      in respect of such action or proceeding may be heard and determined in such
      New
      York State or Federal court. The parties hereto agree that a final judgment
      in
      any such action or proceeding shall be conclusive and may be enforced in other
      jurisdictions by suit on the judgment or in any other manner provided by law.
      The parties hereto further waive any objection to venue in the State of New
      York
      and any objection to an action or proceeding in the State of New York on the
      basis of forum non conveniens.

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    (i) EACH
      PARTY HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF
      ANY
      CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT. THE SCOPE
      OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY DISPUTES THAT MAY
      BE
      FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATER OF THIS AGREEMENT,
      INCLUDING WITHOUT LIMITATION CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS
      AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES
      THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR EACH PARTY TO ENTER INTO A
      BUSINESS RELATIONSHIP, THAT EACH PARTY HAS ALREADY RELIED ON THIS WAIVER IN
      ENTERING INTO THIS AGREEMENT AND THAT EACH PARTY WILL CONTINUE TO RELY ON THIS
      WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY FURTHER WARRANTS AND
      REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT
      SUCH PARTY HAS KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHTS TO A JURY TRIAL
      FOLLOWING SUCH CONSULTATION. THIS WAIVER IS IRREVOCABLE, MEANING THAT,
      NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IT MAY NOT BE MODIFIED EITHER
      ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
      RENEWALS AND SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. IN THE EVENT OF
      A
      LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY
      THE
      COURT. 

    

    (j) This
      Agreement may be executed in any number of counterparts, each of which when
      so
      executed shall be deemed to be an original and, all of which taken together
      shall constitute one and the same Agreement. In the event that any signature
      is
      delivered by facsimile transmission, such signature shall create a valid binding
      obligation of the party executing (or on whose behalf such signature is
      executed) the same with the same force and effect as if such facsimile signature
      were the original thereof.

    

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

     

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
      executed on the day and year first above written.

     

    
      	 	 	 
	 	SKREEM ENTERTAINMENT
              CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ Charles
              Camorata
	 	Charles Camorata
	 	Chief
              Executive Officer

       

      
        	 	 	 
	 	AJW PARTNERS, LLC
	 	By: SMS Group, LLC 
	 
 	 
 	 
 
	 	By:  	/s/
                Corey S.
                Ribotsky
	 	Corey S. Ribotsky
	 	Manager

      

       

      
        	 	 	 
	 	AJW OFFSHORE,
                LTD.
	 	By: First Street Manager II,
                LLC 
	 
 	 
 	 
 
	 	By:  	/s/ Corey
                S.
                Ribotsky
	 	Corey S. Ribotsky
	 	Manager

      

       

      
        	 	 	 
	 	AJW QUALIFIED PARTNERS,
                LLC
	 	By: AJW Manager, LLC 
	 
 	 
 	 
 
	 	By:  	/s/ Corey
                S.
                Ribotsky
	 	Corey S. Ribotsky
	 	Manager

      

       

      
        	 	 	 
	 	NEW MILLENNIUM CAPITAL PARTNERS
                II,
                LLC
	 	By: First Street Manager II,
                LLC 
	 
 	 
 	 
 
	 	By:  	/s/
                Corey S.
                Ribotsky
	 	Corey S. Ribotsky
	 	Manager

      

    

     

    
      
         

      

      
        14STOCK PURCHASE AGREEMENT

                                      AMONG

                        NATIONAL INVESTMENT MANAGERS INC.

                    NATIONAL ACTUARIAL PENSION SERVICES, INC.
                                CHARLES N. McLEOD
                               AND MARY H. McLEOD

                          Dated as of December 1, 2006

<PAGE>

                                TABLE OF CONTENTS

Section                                                                     Page

ARTICLE I SALE AND PURCHASE OF SHARES
   1.1    Sale and Purchase of Shares.........................................1

ARTICLE II PURCHASE PRICE AND PAYMENT
   2.1    Amount of Purchase Price............................................1
   2.2    Payment of Purchase Price...........................................1
   2.3    Net Working Capital Adjustment......................................2
   2.4    Additional Consideration............................................2

ARTICLE III CLOSING AND TERMINATION
   3.1    Closing Date........................................................3
   3.2    Termination of Agreement............................................3
   3.3    Procedure Upon Termination..........................................4
   3.4    Effect of Termination...............................................4

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE SELLERS
   4.1    Organization and Good Standing......................................4
   4.2    Authority...........................................................4
   4.3    Shares..............................................................5
   4.4    Basic Corporate Records.............................................5
   4.5    Minute Books........................................................5
   4.6    Subsidiaries and Affiliates.........................................6
   4.7    Consents............................................................6
   4.8    Financial Statements................................................6
   4.9    Records and Books Account...........................................7
   4.10   Absence of Undisclosed Liabilities..................................7
   4.11   Taxes...............................................................7
   4.12   Account Receivable..................................................9
   4.13   Inventory...........................................................9
   4.14   Machinery and Equipment............................................10
   4.15   Title to Properties; Certain Real Property Matters.................10
   4.16   Leases.............................................................11
   4.17   Patents, Software, Trademarks, Etc.................................12
   4.18   Insurance Policies.................................................12
   4.19   Banking and Personnel Lists........................................13
   4.20   Lists of Contracts, Etc............................................13
   4.21   Compliance With the Law............................................15
   4.22   Litigation, Pending Labor Disputes.................................15
   4.23   Absence of Certain Changes or Events...............................16
   4.24   Employee Benefit Plans.............................................17

                                       i
<PAGE>

   4.25   Product Warranties and Product Liabilities.........................18
   4.26   Assets.............................................................18
   4.27   Absence of Certain Commercial Practices............................19
   4.28   Licenses, Permits, Consents and Approvals..........................19
   4.29   Environmental Matters..............................................19
   4.30   Broker.............................................................21
   4.31   Related Party Transactions.........................................21
   4.32   Patriot Act........................................................21
   4.33   Disclosure.........................................................22

ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASER
   5.1    Organization and Good Standing......................................22
   5.2    Authority...........................................................22
   5.3    Conflicts; Consents of Third Parties................................22
   5.4    Litigation..........................................................23
   5.5    Investment Intention................................................23
   5.6    Broker..............................................................23

ARTICLE VI COVENANTS
   6.1    Access to Information...............................................23
   6.2    Conduct of the Business Pending the Closing.........................24
   6.3    Consents............................................................26
   6.4    Other Actions.......................................................26
   6.5    No Solicitation.....................................................26
   6.6    Preservation of Records.............................................27
   6.7    Publicity...........................................................27
   6.8    Use of Name.........................................................27
   6.9    Employment Agreements...............................................27
   6.10   Board of Directors..................................................27
   6.11   Financial Statements................................................28
   6.12   Tax Election........................................................28
   6.13   Tax Matters.........................................................28

ARTICLE VII CONDITIONS TO CLOSING
   7.1    Conditions Precedent to Obligations of Purchaser....................30
   7.2    Conditions Precedent to Obligations of the Sellers..................32

ARTICLE VIII DOCUMENTS TO BE DELIVERED
   8.1    Documents to be Delivered by the Sellers............................33
   8.2    Documents to be Delivered by the Purchaser..........................33

ARTICLE IX INDEMNIFICATION
   9.1    Indemnification.....................................................33
   9.2    Limitations on Indemnification for Breaches of Representations
            and Warranties....................................................34
   9.3    Indemnification Procedures..........................................35
   9.4    Tax Treatment of Indemnity Payments.................................36

                                       ii
<PAGE>

ARTICLE X MISCELLANEOUS
   10.1   Payment of Sales, Use or Similar Taxes..............................36
   10.2   Survival of Representations and Warranties..........................36
   10.3   Expenses............................................................36
   10.4   Specific Performance................................................36
   10.5   Further Assurances..................................................37
   10.6   Submission to Jurisdiction; Consent to Service of Process...........37
   10.7   Table of Contents and Headings......................................37
   10.8   Governing Law.......................................................38
   10.9   Table of Contents and Headings......................................38
   10.10  Notices.............................................................38
   10.11  Severability........................................................39
   10.12  Binding Effect; Assignment..........................................39

                                       iii
<PAGE>

                            STOCK PURCHASE AGREEMENT

      STOCK PURCHASE AGREEMENT,  dated as of December 1, 2006 (the "Agreement"),
among National Investment Managers Inc., a corporation  organized under the laws
of Florida (the  "Purchaser"),  National  Actuarial  Pension  Services,  Inc., a
corporation  organized under the laws of Texas (the  "Company"),  and Charles N.
McLeod and Mary H. McLeod ("Sellers").

                              W I T N E S S E T H:
                               - - - - - - - - - -

      WHEREAS,  the Sellers own an aggregate  of 1,000  shares of common  stock,
$1.00 par value, of the Company (the "Shares"),  which Shares  constitute all of
the issued and outstanding shares of capital stock of the Company; and

      WHEREAS,  the  Sellers  desires to sell to  Purchaser,  and the  Purchaser
desires to purchase from the Sellers, the Shares for the purchase price and upon
the terms and conditions hereinafter set forth;

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

                                   ARTICLE I
                           SALE AND PURCHASE OF SHARES

      1.1 Sale and Purchase of Shares.

      Upon the terms and  subject to the  conditions  contained  herein,  on the
Closing Date the Sellers shall sell, assign, transfer, convey and deliver to the
Purchaser, and the Purchaser shall purchase from the Sellers, all of the Shares.

                                   ARTICLE II
                           PURCHASE PRICE AND PAYMENT

      2.1 Amount of Purchase  Price.  The purchase price for the Shares shall be
an amount equal to (i)  $1,750,000  (one million seven hundred fifty thousand US
dollars) payable to the Sellers pro rata based upon  proportionate  ownership of
the  Company,  subject to  adjustment  as set forth  herein (the "Cash  Purchase
Price"),  and (ii) $700,000  (seven  hundred  thousand US dollars)  evidenced by
promissory  notes  in the form of  exhibit  2.1  hereto  (of  which  50% of such
promissory  notes shall have a maturity date of 14 months and 50% of which shall
have a maturity date of 26 months) and shall bear interest at the rate of 6% per
annum, payable to the Sellers pro rata based upon proportionate ownership of the
Company  (the  "Notes"  and  collectively  with the  Cash  Purchase  Price,  the
"Purchase Price").

<PAGE>

      2.2 Payment of Purchase  Price.  On the Closing Date, the Purchaser  shall
pay the Cash Purchase Price to the Sellers,  which shall be paid by the delivery
to Sellers of a certified or bank  cashier's  checks in New York Clearing  House
Funds,  payable to the order of the Sellers or, at the Sellers' option,  by wire
transfer of immediately available funds into accounts designated by the Sellers.
On the  Closing  Date,  the  Purchaser  shall  deliver the cash and Notes to the
Sellers.

      2.3 Earnings Adjustment.

      (a) Within 90 days after the end of each of the years ended  December  31,
2007 and  December  31,  2008 (the "2007  Period"  and the "2008  Period"),  the
Purchaser  shall cause to be prepared  and  delivered  to Sellers a statement of
operations of the Company for such twelve month period, determined in accordance
with GAAP. Such statement of operations shall include (i) a separate calculation
of earnings before interest,  taxes,  depreciation and amortization  ("EBITDA");
and (ii) a determination  as to whether the Target EBITDA (as defined below) has
been achieved. Unless within 30 days of delivery of such statement of operations
by Purchaser to Sellers,  Purchaser shall have received a written objection from
Sellers to such statement of operations, then such draft shall be considered the
final  statement  of  operations  of the  Company  for such  period  (the "Final
Statement  of  Operations").  If within 30 days of delivery of the  statement of
operations  by Purchaser  to Sellers,  Purchaser  shall have  received a written
objection  from Sellers to such  statement of  operations,  then the Sellers and
Purchaser  shall attempt to reconcile their  differences  diligently and in good
faith and any resolution by them shall be final, binding and conclusive.  If the
Sellers  and the  Purchaser  are unable to reach a  resolution  with such effect
within 30 days of the  Purchaser's  receipt of the  Sellers'  written  notice of
objection,  the  Sellers  and  the  Purchaser  shall  submit  such  dispute  for
resolution to an independent  accounting firm mutually  appointed by the Sellers
and the Purchaser (the "Independent Accounting Firm"), which shall determine and
report to the parties and such report shall be final,  binding and conclusive on
the parties hereto.  The fees and  disbursements  of the Independent  Accounting
Firm shall  initially be paid by the Sellers;  provided,  however,  in the event
that the Independent  Accounting Firm determines that the Sellers'  objection to
the statement of  operations  are valid,  then the  Purchaser  shall pay the fee
payable to the Independent Accounting Firm.

      (b) If the EBITDA of the Company for either of the 2007 Period or the 2008
Period is less than $575,000 (the "Target EBITDA"), then the principal amount of
the Notes shall be reduced pro rata among all Notes (first reducing the 14 month
Notes,  then the 26 month  Notes),  in an amount  which  equals  the  difference
between the Target  EBIDTA and the actual  EBITDA for such  period (the  "EBIDTA
Reduction").  If a reduction is made to the Notes for the first 12 month period,
and there is cumulative  EBITDA in excess of $1,150,000 for the first and second
12 month periods ("Excess EBIDTA"),  the remaining Note shall be increased in an
amount equal to the Excess  EBIDTA,  but not in excess of the EBIDTA  Reduction.
For all purposes hereof,  EBIDTA shall be calculated after deduction for amounts
paid as salary  or bonus to the  Sellers  or in  payment  of the Base  Bonus (as
hereafter  defined).  Notwithstanding  the  foregoing,  in the  event  that  the
employment of Charles N. McLeod shall be (i)  involuntarily  terminated  without
cause  (which  would  include the  failure of the Company to renew Mr.  McLeod's
employment  agreement),  or (ii) terminated by Charles N. McLeod for good reason
(as defined in the employment  agreement) then the principal amount of the Notes
shall  remain  unchanged  after  the date of any such  termination,  subject  to
reductions for payments of principal by Purchaser.

                                       2
<PAGE>

      For purposes of this Agreement:

                  "Adjusted  EBITDA"  shall  mean the  earnings  of the  Company
            before deduction for interest,  taxes, depreciation and amortization
            ("EBITDA"), as adjusted to give effect to the following factors:

                  (A) EBITDA shall be  calculated  after  deduction  for amounts
            paid in payment of the Base Bonus (as hereinafter defined).

                  (B)  There   shall  be  added  to  EBITDA  any   general   and
            administrative expenses or other corporate overhead of the Purchaser
            or any of its affiliates that are allocated to the Company (it being
            understood  that  all  general  and   administrative   expenses  and
            corporate  overhead of the Company shall be allocated to the Company
            and taken into account in determining Adjusted EBITDA); and

                  (C) No write downs of assets or business  value shall be taken
            into account in determining Adjusted EBITDA.

                  In  determining  "Adjusted  EBITDA"  it is the  intent  of the
parties to fairly  reflect  revenue  and  expenses  attributable  to the Company
consistent with the Financial Statements (as hereafter defined), notwithstanding
any other  accounting  procedures or methods used by Purchaser for its reporting
purposes.

      (c) The Company  shall pay at the  direction  of the Board of Directors of
the Company a bonus to employees  for the 2007 Period based upon an amount equal
to (i) $50,000 ("Base  Bonus"),  plus (ii) the amount of EBIDTA in excess of the
Target EBIDTA, not to exceed $50,000,  plus (iii) 10% of the EBITDA in excess of
$625,000 (the "Bonus") for such year (the "Employee  Bonus Pool").  The Employee
Bonus Pool shall be paid to the Company  employees within sixty (60) days of the
determination  of the  Employee  Bonus  Pool  amount.  The  distribution  of the
Employee Bonus Pool shall be jointly determined by Charles N. McLeod and Leonard
Neuhaus.  If Mr.  McLeod shall not be employed by the Company on the date of the
determination of the Employee Bonus Pool, the determination shall be made by the
Company's  Board of  Directors.  If Mr.  Neuhaus  shall not be  employed  by the
Purchaser  on the date of the  determination  of the  Employee  Bonus Pool,  the
determination shall be made by Mr. McLeod and the Chief Executive Officer of the
Purchaser.

      2.4 Net Working Capital Adjustment.

      (a) At or prior to Closing,  the Sellers  shall provide to the Purchaser a
written  statement  (the  "Working  Capital  Statement"),  in form and substance
satisfactory to the Purchaser, setting forth the amount of the Company's Working
Capital as of the Closing Date by category  (including cash, accounts receivable
("Closing Date  Receivables"),  accounts payable and accrued  liabilities  (such
accounts  payable  and  accrued  liabilities  referred  to  collectively  as the
"Closing Date Payables") in reasonable detail. Immediately prior to the Closing,
the  Sellers  shall cause the Company to pay all  outstanding  accounts  payable
included within the Closing Date Payables, and shall cause the Company to retain
cash in an amount equal to the accrued  liabilities  included within the Closing
Date  Payables.  The  balance  of cash  shall be paid as  bonuses  or  otherwise
distributed at Seller's discretion.  Notwithstanding the foregoing,  the Sellers
agree to provide, at Closing, a non-interest  bearing loan to the Company in the
amount of $100,000, to be repaid upon the earlier of (i) Company cash on hand of
at least $150,000, or (ii) June 30, 2007.

                                       3
<PAGE>

      (b) During the period from the Closing  Date  through the date that is 120
days after the Closing  Date,  the  Company  shall use  commercially  reasonable
efforts to collect the Closing Date  Receivables  for the benefit of the Sellers
and pay such  amounts  to Sellers or an entity  designated  by the  Sellers as a
consulting fee when collected;  provided, that the Company shall not be required
in connection with any such collection efforts to institute any action,  suit or
proceeding,  or incur any cost or  expense,  or to take any  action  other  than
normal and customary collection  procedures.  The Company shall not be liable to
the  Sellers  for any  uncollected  Closing  Date  Receivables  as to  which  it
undertakes commercially reasonable collection efforts, as set forth above. After
the 120 day period,  any remaining Closing Date Receivables shall be assigned to
Seller (or Seller's designated entity).

      2.5 Operation of the Business Post Closing.  The Sellers and the Purchaser
recognize that the Company has not previously sold life insurance and investment
products  to its  clients.  The  Sellers and the  Purchaser  recognize  that the
Purchaser  intends to sell  products  to clients of the  Company in the  future.
Sellers and Purchaser  agree that they shall make their best efforts not to sell
products to clients that have been  referred to the Company by referral  sources
of the Sellers that sell products as part of the referral sources  business.  In
addition, the Purchaser will refrain from attempting to sell products to clients
of referral sources of the Sellers that object to products being sold to clients
of the referral sources. The full amount of the Promissory Notes as set forth in
Section 2.1 of this  Agreement  shall be due and payable within thirty (30) days
of the Seller notifying the Purchaser of any of the following events:

      (a) A serious  conflict  that  develops  between the Purchaser and Sellers
over sales of products to clients which is deemed by either the Purchaser or the
Sellers  to be  irreconcilable,  following  good faith  efforts to resolve  such
conflict; or

      (b) The departure of the Chief Operating Officer, Leonard A. Neuhaus, from
the employment of the Purchaser; or

      (c) The departure of the Chief  Executive  Officer,  Steven Ross, from the
employment of the Purchaser; or

      (d) The sale of the  Purchaser  or the sale of the  Company or the sale of
substantially all of the Company's assets to an unrelated third party; or

      (e) If the  employment  agreements of either of the Sellers is not renewed
for a second year.

                                       4
<PAGE>

                                  ARTICLE III
                             CLOSING AND TERMINATION

      3.1 Closing Date.

            Subject to the  satisfaction of the conditions set forth in Sections
7.1 and 7.2 hereof (or the waiver  thereof by the party  entitled  to waive that
condition),  the closing of the sale and purchase of the Shares  provided for in
Section 1.1 hereof (the "Closing")  shall take place at the offices of Sichenzia
Ross Friedman Ference LLP located at 1065 Avenue of the Americas,  New York, New
York 10018 (or at such other place as the parties may  designate  in writing) on
such date as the Sellers and the Purchaser may designate.  The date on which the
Closing shall be held is referred to in this Agreement as the "Closing Date".

      3.2 Termination of Agreement.

            This Agreement may be terminated prior to the Closing as follows:

      (a) At the election of the Sellers or the  Purchaser on or after  December
15,  2006,  if the Closing  shall not have  occurred by the close of business on
such date,  provided that the terminating  party is not in default of any of its
obligations hereunder;

      (b) by mutual written consent of the Sellers and the Purchaser; or

            (c) by the  Sellers or the  Purchaser  if there shall be in effect a
final  nonappealable  order of a  governmental  body of  competent  jurisdiction
restraining,   enjoining  or  otherwise  prohibiting  the  consummation  of  the
transactions  contemplated hereby; it being agreed that the parties hereto shall
promptly appeal any adverse determination which is not nonappealable (and pursue
such appeal with reasonable diligence).

      3.3 Procedure Upon Termination.

            In the event of termination  and abandonment by the Purchaser or the
Sellers, or both,  pursuant to Section 3.2 hereof,  written notice thereof shall
forthwith  be given to the other  party or  parties,  and this  Agreement  shall
terminate, and the purchase of the Shares hereunder shall be abandoned,  without
further action by the Purchaser or the Sellers.  If this Agreement is terminated
as provided  herein,  each party shall redeliver all documents,  work papers and
other  material of any other party  relating  to the  transactions  contemplated
hereby,  whether so obtained before or after the execution  hereof, to the party
furnishing the same.

      3.4 Effect of Termination.

            In the event that this  Agreement is validly  terminated as provided
herein,  then  each of the  parties  shall  be  relieved  of  their  duties  and
obligations  arising under this Agreement after the date of such termination and
such termination shall be without liability to the Purchaser,  the Company,  the
Sellers or the Company;  provided,  however, that the obligations of the parties
set forth in Section 10.4 hereof shall survive any such termination and shall be
enforceable hereunder;  provided, further, however, that nothing in this Section
3.4 shall  relieve the Purchaser or the Sellers of any liability for a breach of
this Agreement.

                                       5
<PAGE>

                                   ARTICLE IV
                  REPRESENTATIONS AND WARRANTIES OF THE SELLERS

            The Sellers and the Company hereby  jointly and severally  represent
and warrant to the Purchaser that:

      4.1.  Organization  and Good  Standing  of the  Company.  The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its  incorporation as set forth above. The Company is not
required to be qualified to transact  business in any other  jurisdiction  where
the failure to so qualify would have a material  adverse  effect on the business
of the Company.

      4.2. Authority.

            (a)  The  Company  has  full  power  and  authority  (corporate  and
otherwise)  to carry on its business  and has all permits and licenses  that are
necessary to the conduct of its business or to the ownership, lease or operation
of its properties and assets.

            (b) The execution of this  Agreement and the delivery  hereof to the
Purchaser  and the  sale  contemplated  herein  have  been,  or will be prior to
Closing,  duly authorized by the Board of Directors of the Company,  having full
power and authority to authorize such actions.

            (c) Subject to any consents  required  under Section 4.7 below,  the
Sellers  and the  Company  have the full legal  right,  power and  authority  to
execute,  deliver and carry out the terms and provisions of this Agreement;  and
this  Agreement  has been duly and validly  executed and  delivered on behalf of
Sellers and the Company and  constitutes  a valid and binding  obligation of the
Sellers and the Company, enforceable in accordance with its terms.

            (d) Except as set forth in Section 4.2,  neither the  execution  and
delivery  of  this  Agreement,  the  consummation  of  the  transactions  herein
contemplated,  nor  compliance  with the terms of this  Agreement  will violate,
conflict with, result in a breach of, or constitute a default under any statute,
regulation,   indenture,   mortgage,  loan  agreement,  or  other  agreement  or
instrument  to which the Sellers or the Company is a party or by which it or any
of them is  bound  that  will  have a  material  adverse  effect,  any  charter,
regulation,  or bylaw provision of the Company, or any decree, order, or rule of
any court or governmental authority or arbitrator that is binding on the Sellers
or the Company in any way.

      4.3. Shares.

            (a) The  authorized  capital  stock of the Company  consist of 1,000
shares of common  stock,  par value $1.00 per share,  of which 1,000 shares have
been  issued  to  Sellers  and  constitute  the only  shares  of  capital  stock
outstanding.  All of the Shares are duly authorized,  validly issued, fully paid
and non-assessable.

                                       6
<PAGE>

            (b) The Sellers are the lawful  record and  beneficial  owner of all
the Shares, free and clear of any liens, pledges, encumbrances,  charges, claims
or restrictions of any kind, except as set forth in Section 4.3 or Schedule 4.3,
and have, or will have on the Closing  Date,  the  absolute,  unilateral  right,
power,  authority and capacity to enter into and perform this Agreement  without
any other or further  authorization,  action or proceeding,  except as specified
herein.

            (c) There are no authorized or outstanding  subscriptions,  options,
warrants,  calls,  contracts,  demands,  commitments,  convertible securities or
other agreements or arrangements of any character or nature whatever under which
the Company is or may become  obligated to issue,  assign or transfer any shares
of capital  stock of the Company,  except as set forth in Section 4.3.  Upon the
delivery to Purchaser on the Closing Date of the  certificates  representing the
Shares,  Purchaser will have good,  legal,  valid,  marketable and  indefeasible
title to all the then  issued and  outstanding  shares of  capital  stock of the
Company,  free  and  clear  of  any  liens,  pledges,   encumbrances,   charges,
agreements,  options,  claims or other arrangements or restrictions of any kind,
except by those restrictions on transfer imposed by applicable securities laws.

      4.4. Basic Corporate Records.  The copies of the Articles of Incorporation
of the Company (certified by the Secretary of State or other authorized official
of the  jurisdiction of  incorporation),  and the Bylaws of the Company,  as the
case may be  (certified  as of the date of this  Agreement as true,  correct and
complete by the Company's secretary or assistant  secretary),  all of which have
been delivered to the Purchaser,  are true,  correct and complete as of the date
of this Agreement.

      4.5.  Minute  Books.  The  minute  books of the  Company,  which  shall be
exhibited to the Purchaser between the date hereof and the Closing Date, contain
true, correct and complete minutes and records of all meetings,  proceedings and
other actions of the  shareholders,  Board of Directors  and  committees of such
Board of  Directors  of the  Company,  if any,  and, on the Closing  Date,  will
contain  true,  correct  and  complete  minutes  and  records  of any  meetings,
proceedings  and other  actions  of the  shareholders,  Board of  Directors  and
committees of such Board of Directors of the Company.

      4.6.  Subsidiaries  and  Affiliates.  Any  and all  businesses,  entities,
enterprises and organizations in which the Company has any ownership,  voting or
profit and loss sharing percentage interest (the  "Subsidiaries") are identified
in Section 4.6 hereto,  together with the Company's interest therein. Unless the
context requires otherwise or specifically designated to the contrary on Section
4.6  hereto,  "Company"  as  used in  this  Agreement  shall  include  all  such
Subsidiaries. Except as set forth in Section 4.6 or 4.31 or on Schedule 4.6, (i)
the Company has made no advances to, or investments in, nor owns beneficially or
of  record,  any  securities  of or other  interest  in, any  business,  entity,
enterprise or  organization,  (ii) there are no  arrangements  through which the
Company has acquired  from, or provided to, the Sellers or their  affiliates any
goods,  properties  or  services,  (iii)  there  are no  rights,  privileges  or
advantages  now  enjoyed  by the  Company  as a result of the  ownership  of the
Company by the Sellers  which,  to the  knowledge of the Sellers or the Company,
might be lost as a result of the consummation of the  transactions  contemplated
by this Agreement. Each entity shown on Schedule 4.6 is duly organized,  validly
existing  and in  good  standing  under  the  laws  of the  jurisdiction  of its
incorporation,  and has full  corporate  power to own all of its property and to
carry on its business as it is now being  conducted.  Also set forth on Schedule
4.6 is a list of  jurisdictions  in which  each  Subsidiary  is  qualified  as a
foreign corporation.  Such jurisdictions are the only jurisdictions in which the
ownership  or leasing  of  property  by each  Subsidiary  or the  conduct of its
business  requires  it to be so  qualified.  All of the  outstanding  shares  of
capital stock of each  Subsidiary  have been duly authorized and validly issued,
are fully paid and nonassessable,  and, except as set forth on Schedule 4.6, are
owned, of record and beneficially,  by the Company, and on the Closing Date will
be owned by the Company,  free and clear of all liens,  encumbrances,  equities,
options or claims  whatsoever.  No Subsidiary has  outstanding  any other equity
securities  or  securities  options,  warrants  or  rights  of any kind that are
convertible into equity  securities of such  Subsidiary,  except as set forth on
Schedule 4.6.

                                       7
<PAGE>

      4.7.  Consents.  Except as set  forth in  Schedule  4.7,  no  consents  or
approvals of any public body or authority  and no consents or waivers from other
parties to leases,  licenses,  franchises,  permits,  indentures,  agreements or
other  instruments  are  (i)  required  for  the  lawful   consummation  of  the
transactions  contemplated  hereby, or (ii) necessary in order that the Business
can be  conducted  by the  Purchaser  in the same  manner  after the  Closing as
heretofore   conducted  by  the  Company,  nor  will  the  consummation  of  the
transactions contemplated hereby result in creating,  accelerating or increasing
any liability of the Company.

      4.8.  Financial  Statements.  The Sellers have delivered,  or will deliver
prior to Closing, to the Purchaser copies of the following financial  statements
(which include all notes and schedules attached thereto), all of which are true,
complete and correct in all material respects, have been prepared from the books
and records of the Company in  accordance  with  generally  accepted  accounting
principles  ("GAAP")  consistently  applied  and fairly  present  the  financial
condition,  assets,  liabilities  and results of operations of the Company as of
the dates thereof and for the periods covered thereby:

            the audited  balance  sheet of the Company as at
            December  31,  2004 and  2005,  and the  related
            audited statements of operations,  stockholder's
            equity and of cash flows of the  Company for the
            years then ended as audited by Rothstein, Kass &
            Company,  P.C.,  and (ii) the unaudited  balance
            sheet of the  Company as of  September  30, 2006
            and the related compiled statement of operations
            of the  Company  for the nine (9)  month  period
            then  ended  (such  statements,   including  the
            related   notes  and  schedules   thereto,   are
            referred    to   herein   as   the    "Financial
            Statements").

            In such  Financial  Statements,  the statements of operations do not
contain  any items of special  or  nonrecurring  income or any other  income not
earned in the ordinary  course of business  except as set forth in Schedule 4.8,
and the  financial  statements  for the interim  periods  indicated  include all
adjustments, which consist of only normal recurring accruals, necessary for such
fair presentation. There are no facts known to any of the Sellers or the Company
that,  under generally GAAP  consistently  applied,  would alter the information
contained in the foregoing Financial Statements in any material way.

                                       8
<PAGE>

      For the purposes  hereof,  the balance sheet of the Company as of December
31, 2005 is referred to as the "Balance Sheet" and December 31, 2005 is referred
to as the "Balance Sheet Date".

      4.9. Records and Books of Account. The records and books of account of the
Company and of each Subsidiary  reflect all material items of income and expense
and all material  assets,  liabilities  and accruals,  and have been, and to the
Closing Date will be,  regularly  kept and  maintained in conformity  with sound
accounting principles applied on a consistent basis.

      4.10.  Absence  of  Undisclosed  Liabilities.  Except as and to the extent
reflected or reserved against in the Company's Financial Statements or disclosed
in Schedule 4.10,  there are no liabilities or obligations of the Company of any
kind whatsoever,  whether accrued,  fixed, absolute,  contingent,  determined or
determinable,  and  including  without  limitation  (i)  liabilities  to former,
retired or active employees of the Company under any pension, health and welfare
benefit plan,  vacation plan or other plan of the Company,  (ii) tax liabilities
incurred in respect of or  measured by income for any period  prior to the close
of business on the Balance  Sheet Date, or arising out of  transactions  entered
into,  or any  state of facts  existing,  on or prior to said  date,  and  (iii)
contingent liabilities in the nature of an endorsement,  guarantee, indemnity or
warranty, and there is no condition, situation or circumstance existing or which
has  existed  that  could  reasonably  be  expected  to result  in any  material
liability of the Company,  other than  liabilities  and  contingent  liabilities
incurred  in the  ordinary  course of  business  since the  Balance  Sheet  Date
consistent with the Company's recent customary business practice,  none of which
is materially adverse to the Company.

      4.11 Taxes.

            (a) For purposes of this Agreement,  "Tax" or "Taxes" refers to: (i)
any and all  federal,  state,  local and foreign  taxes,  assessments  and other
governmental  charges,  duties,  impositions and liabilities  relating to taxes,
including  taxes  based upon or  measured by gross  receipts,  income,  profits,
sales,  use and occupation,  and value added, ad valorem,  transfer,  franchise,
withholding,  payroll,  recapture,  employment,  excise and  property  taxes and
escheatment  payments,  together  with all  interest,  penalties  and  additions
imposed with respect to such amounts and any obligations under any agreements or
arrangements  with any other person with  respect to such amounts and  including
any  liability  for taxes of a  predecessor  entity;  (ii) any liability for the
payment of any amounts of the type  described in clause (i) as a result of being
or ceasing to be a member of an  affiliated,  consolidated,  combined or unitary
group for any period (including,  without limitation, any liability under Treas.
Reg.  Section  1.1502-6 or any comparable  provision of foreign,  state or local
law);  and  (iii) any  liability  for the  payment  of any  amounts  of the type
described in clause (i) or (ii) as a result of any express or implied obligation
to  indemnify  any  other  person or as a result  of any  obligations  under any
agreements  or  arrangements  with any other person with respect to such amounts
and including any liability for taxes of a predecessor entity.

            (b) (i) The Company has timely filed all federal,  state,  local and
foreign  returns,  estimates,  information  statements  and reports  ("Returns")
relating to Taxes  required to be filed by the Company  with any Tax  authority.
All such Returns are true, correct and complete in all respects. The Company has
paid all Taxes  shown to be due on such  Returns.  Except as listed on  Schedule
4.11 hereto,  the Company is not currently the  beneficiary of any extensions of
time  within  which  to file any  Returns.  The  Sellers  and the  Company  have
furnished and made  available to the Purchaser  complete and accurate  copies of
all income and other Tax Returns and any amendments thereto filed by the Company
in the last three (3) years.

                                       9
<PAGE>

                  (ii) The Company,  as of the Closing Date,  will have withheld
and  accrued or paid to the proper  authority  all Taxes  required  to have been
withheld and accrued or paid.

                  (iii) The  Company has not been  delinquent  in the payment of
any Tax nor is there any Tax  deficiency  outstanding  or assessed  against such
Company.  The Company has not  executed any  unexpired  waiver of any statute of
limitations  on or extending the period for the  assessment or collection of any
Tax.

                  (iv)  There  is no  dispute,  claim,  or  proposed  adjustment
concerning  any Tax liability of the Company either (A) claimed or raised by any
Tax  authority in writing or (B) based upon  personal  contact with any agent of
such Tax  authority,  and  there  is no claim  for  assessment,  deficiency,  or
collection of Taxes, or proposed  assessment,  deficiency or collection from the
Internal Revenue Service or any other governmental authority against the Company
which has not been satisfied.  The Company is not a party to nor has the Company
been  notified in writing  that it is the subject of any pending,  proposed,  or
threatened action,  investigation,  proceeding, audit, claim or assessment by or
before the Internal  Revenue Service or any other  governmental  authority,  nor
does the  Company  have any  reason  to  believe  that any such  notice  will be
received in the future.  Neither the Internal  Revenue  Service nor any state or
local taxation  authority has ever audited any income tax return of the Company.
The Company has not filed any requests  for rulings  with the  Internal  Revenue
Service.  No power of attorney has been granted by the Company or its Affiliates
with respect to any matter  relating to Taxes of the  Company.  There are no Tax
liens of any kind  upon any  property  or  assets  of the  Company,  except  for
inchoate liens for Taxes not yet due and payable.

                  (v) The Company has no  liability  for any unpaid  Taxes which
has not been paid or accrued  for or  reserved on the  Financial  Statements  in
accordance with GAAP,  whether asserted or unasserted,  contingent or otherwise,
except as set forth in Schedule 4.11.

                  (vi) There is no contract,  agreement,  plan or arrangement to
which the Company is a party as of the date of this Agreement, including but not
limited to the  provisions  of this  Agreement,  covering any employee or former
employee of the Company that, individually or collectively,  would reasonably be
expected to give rise to the payment of any amount that would not be  deductible
pursuant to Sections 280G,  404 or 162(m) of the Internal  Revenue Code of 1986,
as amended (the "Code"). There is no contract, agreement, plan or arrangement to
which  the  Company  is a party  or by  which  it is  bound  to  compensate  any
individual for excise taxes paid pursuant to Section 4999 of the Code.

                  (vii) The Company has not filed any  consent  agreement  under
Section 341(f) of the Code or agreed to have Section 341(f)(2) of the Code apply
to any disposition of a subsection (f) asset (as defined in Section 341(f)(4) of
the Code) owned by the Company.

                                       10
<PAGE>

                  (viii) The  Company is not a party to, nor has any  obligation
under any tax-sharing, tax indemnity or tax allocation agreement or arrangement.

                  (ix) None of the Company's  assets are tax exempt use property
within the meaning of Section 168(h) of the Code.

      4.12. Accounts Receivable. The accounts receivable of the Company shown on
the Balance Sheet Date, and those to be shown in the Financial Statements,  are,
and will be,  actual bona fide  receivables  from  transactions  in the ordinary
course of business  representing valid and binding obligations of others for the
total dollar  amount shown  thereon,  and as of the Balance  Sheet Date were not
(and presently are not) subject to any recoupments,  set-offs, or counterclaims.
All such accounts  receivable  are and will be  collectible  in amounts not less
than  the  amounts  (net of  reserves)  carried  on the  books  of the  Company,
including the Financial  Statements,  and will be paid in accordance  with their
terms except as set forth in Schedule  4.12.  Except as listed on Schedule  4.12
hereto,  all  such  accounts  receivable  are  and  will  be  actual  bona  fide
receivables from transactions in the ordinary course of business.

      4.13. Intentionally Left Blank.

      4.14.  Machinery  and  Equipment.  Except  for  items  disposed  of in the
ordinary  course of business,  all  computers and related  software,  machinery,
tools, furniture,  fixtures, equipment, vehicles, leasehold improvements and all
other tangible  personal  property  (hereinafter  "Fixed Assets") of the Company
currently being used in the conduct of its business,  or included in determining
the net book value of the Company on the Balance  Sheet Date,  together with any
machinery or equipment  that is leased or operated by the Company,  are in fully
serviceable  working condition and repair. Said Fixed Assets shall be maintained
in such  condition  from the date hereof  through the  Closing  Date.  Except as
described on Schedule 4.14 hereto,  all Fixed Assets owned,  used or held by the
Company are situated at its  business  premises  and are  currently  used in its
business.  Schedule  4.14  describes all Fixed Assets owned by or an interest in
which is claimed by any other  person  (whether a  customer,  supplier  or other
person) for which the Company is responsible  (copies of all agreements relating
thereto being attached to said Schedule  4.14),  and all such property is in the
Company's  actual  possession  and is in such  condition that upon the return of
such  property in its present  condition  to its owner,  the Company will not be
liable in any amount to such owner.  There are no  outstanding  requirements  or
recommendations  by any  insurance  company  that has  issued a policy  covering
either (i) such Fixed Assets or (ii) any liabilities of the Company  relating to
operation of the Business,  or by any board of fire  underwriters  or other body
exercising similar  functions,  requiring or recommending any repairs or work to
be done on any Fixed Assets or any changes in the  operations  of the  Business,
any equipment or machinery  used  therein,  or any  procedures  relating to such
operations,  equipment  or  machinery.  All Fixed  Assets of the Company are set
forth on Schedule 4.14 hereto.

      4.15. Real Property Matters. The Company does not own any real property as
of the date  hereof and has not owned any real  property  during the three years
preceding the date hereof.

                                       11
<PAGE>

      4.16.  Leases. All leases of real and personal property of the Company are
described in Schedule 4.16,  are in full force and effect and constitute  legal,
valid and binding  obligations of the respective parties thereto  enforceable in
accordance  with  their  terms,  except as limited  by  bankruptcy,  insolvency,
reorganization,  moratorium or similar laws  relating to or affecting  generally
the enforcement of creditor's  rights, and have not been assigned or encumbered.
The Company has performed in all material  respects the obligations  required to
be performed by it under all such leases to date and it is not in default in any
material respect under any of said leases, except as set forth in Schedule 4.16,
nor has it  made  any  leasehold  improvements  required  to be  removed  at the
termination of any lease,  except signs.  No other party to any such lease is in
material  default  thereunder.  Except as noted on  Schedule  4.16,  none of the
leases listed  thereon  require the consent of a third party in connection  with
the transfer of the Shares.

      4.17.  Patents,  Software,  Trademarks,  Etc. The Company owns, or possess
adequate  licenses or other rights to use, all  patents,  software,  trademarks,
service marks,  trade names and copyrights and trade secrets,  if any, necessary
to  conduct  its  business  as  now  operated  by  it.  The  patents,  software,
trademarks,  service marks,  copyrights,  trade names and trade secrets, if any,
registered  in the name of or owned or used by or  licensed  to the  Company and
applications for any thereof  (hereinafter the  "Intangibles")  are described or
referenced in Schedule 4.17.  Sellers hereby  specifically  acknowledge that all
right,  title and interest in and to all patents and software listed on Schedule
4.17 as  patents  owned by the  Company  are owned by the  Company  and that the
ownership  of such  patents  and  software  will be  transferred  as part of the
Company to Purchaser as part of the transaction contemplated hereby. No officer,
director,  shareholder  or employee of the Company or any  relative or spouse of
any such  person  owns any  patents or patent  applications  or any  inventions,
software,  secret formulae or processes,  trade secrets or other similar rights,
nor is any of them a party to any  license  agreement,  used by or useful to the
Company or related to the  Business  except as listed in Schedule  4.17.  All of
said  Intangibles  are  valid  and in good  standing,  are free and clear of all
liens,  security interests,  charges,  restrictions and encumbrances of any kind
whatsoever, and have not been licensed to any third party except as described in
Schedule 4.17. The Company has not been charged with, nor has it infringed,  nor
to the Sellers'  knowledge is it threatened to be charged with  infringement of,
any patent,  proprietary rights or trade secrets of others in the conduct of its
business,  and, to the date  hereof,  neither  the Sellers nor the Company  have
received any notice of conflict  with or  violation  of the  asserted  rights in
intangibles or trade secrets of others. The Company is not now manufacturing any
goods under a present permit,  franchise or license, except as set forth in said
Schedule 4.17. The consummation of the transactions contemplated hereby will not
alter or impair any rights of the Company in any such Intangibles or in any such
permit,  franchise  or  license,  except as  described  in  Schedule  4.17.  The
Intangibles  are in such form and of such quality and will be maintained in such
a  manner  that  the  Company  can,  following  the  Closing,  design,  produce,
manufacture,  assemble and sell the products and provide the services heretofore
provided by it so that such products and services meet applicable specifications
and  conform  with the  standards  of quality and cost of  production  standards
heretofore  met by it. The Company has the sole and  exclusive  right to use its
corporate and trade names in the jurisdictions where it transacts business.

      4.18.  Insurance Policies.  There is set forth in Schedule 4.18 a list and
brief  description  of all  insurance  policies  on the date  hereof held by the
Company  or on which  it pays  premiums,  including,  without  limitation,  life
insurance and title insurance policies,  which description includes the premiums
payable by it thereunder. Schedule 4.18 also sets forth, in the case of any life
insurance policy held by the Company, the name of the insured under such policy,
the cash surrender  value thereof and any loans  thereunder.  All such insurance
premiums in respect of such coverage have been, and to the Closing Date will be,
paid in full, or if not due,  properly accrued on the Balance Sheet. All claims,
if any,  made against the Company  which are covered by such policies have been,
or are being,  settled or defended by the insurance  companies  that have issued
such  policies.  Up to  the  Closing  Date,  such  insurance  coverage  will  be
maintained  in full  force and  effect and will not be  cancelled,  modified  or
changed  without the express  written  consent of the  Purchaser,  except to the
extent the maturity  dates of any such  insurance  policies  expire prior to the
Closing Date. No such policy has been, or to the Closing Date will be, cancelled
by the issuer  thereof,  and, to the  knowledge  of the Sellers and the Company,
between the date hereof and the Closing Date,  there shall be no increase in the
premiums  with  respect  to any such  insurance  policy  caused by any action or
omission of the Sellers or of the Company.

                                       12
<PAGE>

      4.19.  Banking and  Personnel  Lists.  The  Sellers  and the Company  will
deliver to the Purchaser prior to the Closing Date the following  accurate lists
and summary descriptions relating to the Company:

                  (i) The name of each bank in which the  Company has an account
or safe deposit box and the names of all persons  authorized  to draw thereon or
have access thereto.

                  (ii)  The  names,   current  annual  salary  rates  and  total
compensation for the preceding  fiscal year of all of the present  directors and
officers of the  Company,  and any other  employees  whose  current base accrual
salary or annualized hourly rate equivalent is $20,000 or more,  together with a
summary of the bonuses, percentage compensation and other like benefits, if any,
paid or  payable  to such  persons  for the last  full  fiscal  year  completed,
together with a schedule of changes since that date, if any.

                  (iii) A schedule  of  workers'  compensation  payments  of the
Company  over the past five full  fiscal  years and the fiscal  year to date,  a
schedule of claims by employees of the Company against the workers' compensation
fund for any reason over such period,  identification  of all  compensation  and
medical  benefits  paid to date on each such claim and the  estimated  amount of
compensation and medical benefits to be paid in the future on each such claim.

                  (iv) The name of all pensioned  employees of the Company whose
pensions  are unfunded  and are not paid or payable  pursuant to any  formalized
pension arrangements, their agent and annual unfunded pension rates.

                  (v) The name,  address,  telephone  number,  facsimile number,
email address,  the name of the principal contact and all other relevant contact
information of all clients and business relationships of the Sellers.

                                       13
<PAGE>

      4.20.  Lists of Contracts,  Etc. There is included in Schedule 4.20 a list
of the following items (whether written or oral) relating to the Company,  which
list identifies and fairly summarizes each item:

                  (i) All collective bargaining and other labor union agreements
(if any);  all employment  agreements  with any officer,  director,  employee or
consultant;  and all employee pension,  health and welfare benefit plans,  group
insurance,  bonus, profit sharing,  severance,  vacation,  hospitalization,  and
retirement  plans,  post-retirement  medical benefit plans, and any other plans,
arrangements  or custom  requiring  payments  or benefits to current or retiring
employees.

                  (ii) All joint venture  contracts of the Company or affiliates
relating to the Business;

                  (iii) All material  contracts  of the Company  relating to (a)
obligations for borrowed money, (b) obligations evidenced by bonds,  debentures,
notes or other similar instruments, (c) obligations to pay the deferred purchase
price of property or services,  except  trade  accounts  payable  arising in the
ordinary course of business,  (d) obligations under capital leases,  (e) debt of
others  secured by a lien on any asset of the  Company,  and (f) debts of others
guaranteed by the Company.

                  (iv) All material  agreements  of the Company  relating to the
supply  of raw  materials  for  and  the  distribution  of the  products  of the
Business,  including  without  limitation all sales  agreements,  manufacturer's
representative  agreements and distribution agreements of whatever magnitude and
nature, and any commitments therefor;

                  (v) All  contracts  that  individually  provide for  aggregate
future  payments to or from any of the Company of $5,000 or more,  to the extent
not included in (i) through (iv) above;

                  (vi) All  material  contracts  of the Company that have a term
exceeding one year and that may not be cancelled without any liability,  penalty
or premium, to the extent not included in (i) through (v) above;

                  (vii) A complete  list of all  outstanding  powers of attorney
granted by any of the Company; and

                  (viii) All other  contracts  of the  Company  material  to the
business,  assets,  liabilities,  financial condition,  results of operations or
prospects of the Business taken as a whole to the extent not included above.

      Except as set forth in Schedule 4.20,  (i) all  contracts,  agreements and
commitments of the Company set forth in Schedule 4.20 are valid,  binding and in
full force and effect in all material respects, and (ii) neither the Company nor
any other party to any such  contract,  agreement,  or commitment has materially
breached any provision thereof or is in default thereunder.  Except as set forth
in Schedule 4.20, the sale of the Shares by the Sellers in accordance  with this
Agreement  will not result in the  termination  of any  contract,  agreement  or
commitment of the Company set forth in Schedule 4.20, and immediately  after the
Closing, each such contract, agreement or commitment will continue in full force
and effect without the imposition or acceleration of any burdensome condition or
other  obligation  on the Company  resulting  from the sale of the Shares by the
Sellers. True and complete copies of the contracts,  leases,  licenses and other
documents  referred to in this Schedule 4.20 will be delivered to the Purchaser,
certified  by the  Secretary  or  Assistant  Secretary  of the  Company as true,
correct and complete  copies,  not later than four weeks from the date hereof or
ten business days before the Closing Date, whichever is sooner.

                                       14
<PAGE>

      There are no pending  disputes  with  customers  or vendors of the Company
regarding  quality or return of goods involving  amounts in dispute with any one
customer or vendor, whether for related or unrelated claims, in excess of $5,000
except as  described on Schedule  4.20 hereto,  all of which will be resolved to
the  reasonable  satisfaction  of Purchaser  prior to the Closing  Date.  To the
knowledge of Sellers and the Company,  there has not been any event,  happening,
threat or fact that  would lead them to believe  that any of said  customers  or
vendors will terminate or materially alter their business  relationship with the
Company after completion of the transactions contemplated by this Agreement.

      4.21.  Compliance  With the Law.  The Company is not in  violation  of any
applicable  federal,  state,  local or foreign law,  regulation  or order or any
other,  decree or requirement of any governmental,  regulatory or administrative
agency or authority or court or other tribunal  (including,  but not limited to,
any law,  regulation  order or requirement  relating to securities,  properties,
business, products,  manufacturing processes,  advertising,  sales or employment
practices,  terms and conditions of employment,  occupational safety, health and
welfare,  conditions of occupied premises,  product safety and liability,  civil
rights,  or  environmental  protection,  including,  but not limited  to,  those
related to waste  management,  air pollution  control,  waste water treatment or
noise abatement). Except as set forth in Schedule 4.21, the Company has not been
and are not now charged  with, or to the knowledge of the Sellers or the Company
under  investigation  with  respect to, any  violation  of any  applicable  law,
regulation,  order or requirement relating to any of the foregoing,  nor, to the
knowledge  of  Sellers  or  the  Company  after  due  inquiry,   are  there  any
circumstances  that would or might give rise to any such violation.  The Company
has filed all reports required to be filed with any governmental,  regulatory or
administrative agency or authority.

      4.22.   Litigation;   Pending  Labor  Disputes.   Except  as  specifically
identified on Schedule 4.22:

                  (i) There are no legal,  administrative,  arbitration or other
proceedings  or  governmental  investigations  pending or, to the  knowledge  of
Sellers or the Company, threatened, against the Sellers or the Company, relating
to the Business or the Company or its properties (including leased property), or
the transactions contemplated by this Agreement, nor is there any basis known to
the Sellers or the Company for any such action.

                  (ii) There are no  judgments,  decrees or orders of any court,
or any governmental  department,  commission,  board,  agency or instrumentality
binding upon Sellers or the Company  relating to the Business or the Company the
effect of which is to prohibit any business  practice or the  acquisition of any
property or the conduct of any business by the Company or which limit or control
or otherwise adversely affect its method or manner of doing business.

                                       15
<PAGE>

                  (iii) No work stoppage has occurred and is  continuing  or, to
the knowledge of Sellers or the Company,  is threatened  affecting the Business,
and no representation  question involving recognition of a collective bargaining
agent exists in respect of any employees of the Company.

                  (iv)  There  are  no  pending  labor   negotiations  or  union
organization efforts relating to employees of the Company.

                  (v) There are no charges of  discrimination  (relating to sex,
age,  race,  national  origin,  handicap  or  veteran  status)  or unfair  labor
practices pending or, to the knowledge of the Sellers or the Company, threatened
before any governmental or regulatory  agency or authority or any court relating
to employees of the Company.

      4.23. Absence of Certain Changes or Events. The Company has not, since the
Balance Sheet Date, except as described on Schedule 4.23:

                  (i) Incurred any material  obligation or liability  (absolute,
accrued,  contingent or otherwise) or in connection with the performance of this
Agreement,  and any such obligation or liability incurred in the ordinary course
is not  materially  adverse,  except for  claims,  if any,  that are  adequately
covered by insurance;

                  (ii) Discharged or satisfied any lien or encumbrance,  or paid
or satisfied any  obligations  or liability  (absolute,  accrued,  contingent or
otherwise)  other than (a) liabilities  shown or reflected on the Balance Sheet,
and (b) liabilities incurred since the Balance Sheet Date in the ordinary course
of business that were not materially adverse;

                  (iii)  Increased  or  established  any  reserve or accrual for
taxes or other liability on its books or otherwise provided therefor, except (a)
as  disclosed  on the  Balance  Sheet,  or (b) as may have been  required  under
generally accepted accounting principles due to income earned or expense accrued
since the Balance Sheet Date and as disclosed to the Purchaser in writing;

                  (iv)  Mortgaged,  pledged or subjected to any lien,  charge or
other encumbrance any of its material assets, tangible or intangible;

                  (v) Sold or  transferred  any of its assets or  cancelled  any
debts or claims or waived any rights,  except in the ordinary course of business
and which has not been materially adverse;

                                       16
<PAGE>

                  (vi)  Disposed  of  or  permitted  to  lapse  any  patents  or
trademarks or any patent or trademark  applications material to the operation of
its business;

                  (vii)  Incurred any  significant  labor trouble or granted any
general or uniform  increase in salary or wages payable or to become  payable by
it to any  director,  officer,  employee  or agent,  or by means of any bonus or
pension plan,  contract or other  commitment  increased the  compensation of any
director, officer, employee or agent;

                  (viii)  Authorized any capital  expenditure for real estate or
leasehold improvements,  machinery, equipment or molds in excess of $5,000.00 in
the aggregate;

                  (ix)  Except for this  Agreement,  entered  into any  material
transaction;

                  (x) Issued any stocks,  bonds, or other corporate  securities,
or made any  declaration  or  payment of any  dividend  or any  distribution  in
respect of its capital stock; or

                  (xi) Experienced  damage,  destruction or loss (whether or not
covered by insurance)  individually or in the aggregate materially and adversely
affecting any of its  properties,  assets or business,  or experienced any other
material  adverse change or changes  individually or in the aggregate  affecting
its financial condition, assets, liabilities or business.

      4.24. Employee Benefit Plans.

            (a) Schedule 4.24 lists a description of the only Employee  Programs
(as defined below) that have been  maintained  (as such term is further  defined
below) by the  Company at any time  during the five (5) years  prior to the date
hereof.

            (b) There has not been any  failure of any party to comply  with any
laws applicable with respect to any Employee Program that has been maintained by
the Company.  With respect to any Employee Programs now or heretofore maintained
by the  Company,  there has  occurred  no breach of any duty under the  Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or other applicable
law which could result,  directly or indirectly in any taxes, penalties or other
liability to the Purchaser,  the Company or any affiliate (as defined below). No
litigation,   arbitration,   or  governmental   administrative   proceeding  (or
investigation)  or other proceeding (other than those relating to routine claims
for  benefits)  is pending  or, to the  knowledge  of the  Company  or  Sellers,
threatened with respect to any such Employee Program.

            (c) Except as set forth in Schedule  4.24 attached  hereto,  neither
the Company nor any  affiliate  has ever (i)  provided  health care or any other
non-pension  benefits to any employees  after their  employment  was  terminated
(other than as required by Part 6 of Subtitle B of Title I of ERISA) or has ever
promised  to  provide  such  post-termination  benefits  or (ii)  maintained  an
Employee  Program  provided  to such  employees  subject  to Title IV of  ERISA,
Section  401(a) or  Section  412 of Code,  including,  without  limitation,  any
Multiemployer Plan.

                                       17
<PAGE>

            (d) For purposes of this Section 4.24:

                  (i) "Employee  Program"  means (A) all employee  benefit plans
within  the  meaning of ERISA  Section  3(3),  including,  but not  limited  to,
multiple  employer  welfare  arrangements  (within the meaning of ERISA  Section
3(40)),  plans to which  more than one  unaffiliated  employer  contributes  and
employee  benefit plans (such as foreign or excess  benefit plans) which are not
subject to ERISA;  and (B) all stock  option  plans,  bonus or  incentive  award
plans, severance pay policies or agreements,  deferred compensation  agreements,
supplemental income arrangements, vacation plans, and all other employee benefit
plans,  agreements,  and arrangements not described in (A) above. In the case of
an Employee  Program  funded through an  organization  described in Code Section
501(c)(9),  each reference to such Employee Program shall include a reference to
such organization;

                  (ii) An entity  "maintains" an Employee Program if such entity
sponsors,  contributes  to, or provides  (or has  promised to provide)  benefits
under such  Employee  Program,  or has any  obligation  (by  agreement  or under
applicable  law) to  contribute  to or  provide  benefits  under  such  Employee
Program,  or if such Employee Program  provides  benefits to or otherwise covers
employees of such entity (or their spouses, dependents, or beneficiaries);

                  (iii) An entity is an  "affiliate" of the Company for purposes
of this  Section 3.24 if it would have ever been  considered  a single  employer
with the Company  under ERISA  Section  4001(b) or part of the same  "controlled
group" as the Company for purposes of ERISA Section 302(d)(8)(C); and

                  (iv)  "Multiemployer  Plan" means a (pension  or  non-pension)
employee  benefit plan to which more than one employer  contributes and which is
maintained pursuant to one or more collective bargaining agreements.

      4.25. DELETED

      4.26.  Assets.  The assets of the  Company  are  located at the  locations
listed on Schedule 4.26 attached  hereto.  Except as described in Schedule 4.26,
the assets of the Company  are, and together  with the  additional  assets to be
acquired or otherwise received by the Company prior to the Closing,  will at the
Closing Date be,  sufficient in all material respects to carry on the operations
of the Business as now conducted by the Company. The Company (including for such
purpose any Subsidiaries  thereof listed on Schedule 4.20) are the only business
organizations  through which the Business is  conducted.  Except as set forth in
Schedule 4.16 or Schedule  4.26,  all assets used by the Sellers and the Company
to conduct  the  Business  are,  and will on the Closing  Date be,  owned by the
Company.

                                       18
<PAGE>

      4.27.  Absence of Certain  Commercial  Practices.  Except as  described on
Schedule  4.27,  neither  the  Company  nor the  Sellers  has made  any  payment
(directly or by secret commissions,  discounts,  compensation or other payments)
or given any gifts to  another  business  concern,  to an agent or  employee  of
another business concern or of any governmental  entity (domestic or foreign) or
to a political party or candidate for political office (domestic or foreign), to
obtain  or  retain  business  for  the  Company  or  to  receive   favorable  or
preferential   treatment,   except   for  gifts  and   entertainment   given  to
representatives  of  customers or potential  customers of  sufficiently  limited
value and in a form (other than cash) that would not be  construed as a bribe or
payoff.

      4.28. Licenses,  Permits,  Consents and Approvals. The Company has, and at
the Closing Date will have,  all licenses,  permits or other  authorizations  of
governmental,    regulatory   or   administrative    agencies   or   authorities
(collectively, "Licenses") required to conduct the Business. All Licenses of the
Company are listed on Schedule  4.28 hereto.  At the  Closing,  the Company will
have all such  Licenses  which are  material to the conduct of the  Business and
will have renewed all Licenses  which would have expired in the interim.  Except
as listed in  Schedule  4.28,  no  registration,  filing,  application,  notice,
transfer, consent, approval, order, qualification, waiver or other action of any
kind (collectively,  a "Filing") will be required as a result of the sale of the
Shares by Sellers in accordance with this Agreement (a) to avoid the loss of any
License or the violation, breach or termination of, or any default under, or the
creation of any lien on any asset of the  Company  pursuant to the terms of, any
law,  regulation,  order or other  requirement or any contract  binding upon the
Company or to which any such asset may be  subject,  or (b) to enable  Purchaser
(directly or through any  designee) to continue the operation of the Company and
the Business  substantially  as conducted  prior to the Closing  Date.  All such
Filings will be duly filed, given,  obtained or taken on or prior to the Closing
Date and will be in full force and effect on the Closing Date.

      4.29. Environmental Matters. Except as set forth on Schedule 4.29 hereto:

            (a)  The  operations  of the  Company  are in  compliance  with  all
applicable Laws promulgated by any governmental entity which prohibit,  regulate
or  control  any  hazardous   material  or  any  hazardous   material   activity
("Environmental  Laws") and all permits issued pursuant to Environmental Laws or
otherwise  except for where  noncompliance  or the absence of such permits would
not, individually or in the aggregate, have a Material Adverse Effect;

            (b)  The  Company  has  obtained  all  permits  required  under  all
applicable Environmental Laws necessary to operate the Business;

            (c) The Company is not the subject of any outstanding  written order
or Contract with any governmental  authority or person respecting  Environmental
Laws or any violation or potential violations thereof; and,

            (d) The Company has not received any written communication  alleging
either or both that the Company may be in violation of any Environmental Law, or
any permit issued pursuant to Environmental Law, or may have any liability under
any Environmental Law.

                                       19
<PAGE>

      4.30 Broker. Except as specified in Schedule 4.30, neither the Company nor
the  Sellers  has  retained  any  broker  in  connection  with  any  transaction
contemplated by this Agreement. Purchaser and the Company shall not be obligated
to pay any fee or commission  associated with the retention or engagement by the
Company or Sellers of any broker in connection with any transaction contemplated
by this Agreement.

      4.31.  Related Party  Transactions.  Except as described in Schedule 4.31,
all transactions  during the past five years between the Company and any current
or former  shareholder  or any  entity in which the  Company  or any  current or
former  shareholder  had or has a direct or indirect  interest have been fair to
the Company as determined by the Board of Directors. During the past five years,
the Company has not forgiven or cancelled, without receiving full consideration,
any indebtedness owing to it by the Sellers.

      4.32  Patriot  Act.  The Company and the Sellers  certify that neither the
Company nor any of its  Subsidiaries  has been  designated,  and is not owned or
controlled,  by a "suspected terrorist" as defined in Executive Order 13224. The
Company and the Sellers hereby  acknowledge  that the Purchaser  seeks to comply
with all applicable laws concerning money laundering and related activities.  In
furtherance  of those  efforts,  the Company and the Sellers  hereby  represent,
warrant  and agree that:  (i) none of the cash or property  that the Sellers has
contributed or paid or will  contribute and pay to the Company has been or shall
be derived  from,  or related to, any  activity  that is deemed  criminal  under
United States law; and (ii) no  contribution or payment by the Company or any of
their  Subsidiaries  to the  Purchaser,  to the extent  that they are within the
Companies' and/or their Subsidiaries' control shall cause the Purchaser to be in
violation of the United States Bank Secrecy Act, the United States International
Money Laundering  Control Act of 1986 or the United States  International  Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001. The Sellers shall
promptly notify the Purchaser if any of these representations  ceases to be true
and accurate regarding the Sellers, the Company or any of its Subsidiaries.  The
Sellers agrees to provide the Purchaser any additional information regarding the
Company or any of its  Subsidiaries  that the Purchaser  reasonably  requests to
ensure  compliance  with all applicable  laws  concerning  money  laundering and
similar activities.

      4.33. Disclosure.  All statements contained in any schedule,  certificate,
opinion,  instrument, or other document delivered by or on behalf of the Sellers
or  the  Company   pursuant  hereto  or  in  connection  with  the  transactions
contemplated  hereby  shall be  deemed  representations  and  warranties  by the
Sellers and the Company herein. No statement,  representation or warranty by the
Sellers  or the  Company  in this  Agreement  or in any  schedule,  certificate,
opinion,  instrument,  or other  document  furnished  or to be  furnished to the
Purchaser  pursuant hereto or in connection with the  transactions  contemplated
hereby contains or will contain any untrue statement of a material fact or omits
or will omit to state a material fact required to be stated therein or necessary
to make the statements contained therein not misleading or necessary in order to
provide a  prospective  purchaser  of the  business of the Company with full and
fair disclosure in all material respects  concerning the Company,  the Business,
and the Company's affairs. Except as expressly represented and warranted in this
Agreement,  Sellers make no  representations  or  warranties to Purchaser of any
kind, nature, express or implied, as to any matter whatsoever.

                                       20
<PAGE>

                                   ARTICLE V
                   REPRESENTATIONS AND WARRANTIES OF PURCHASER

      5.1 Organization and Good Standing.

      The Purchaser is a corporation  duly  organized,  validly  existing and in
good standing under the laws of the State of Florida.

      5.2 Authority.

            (a)  The   execution   and  delivery  of  this   Agreement  and  the
consummation of the transactions contemplated herein have been, or will prior to
Closing  be,  duly  and  validly  approved  and  acknowledged  by all  necessary
corporate action on the part of the Purchaser.

            (b) The execution of this  Agreement and the delivery  hereof to the
Sellers and the  purchase  contemplated  herein  have been,  or will be prior to
Closing, duly authorized by the Purchaser's Board of Directors having full power
and authority to authorize such actions.

      5.3 Conflicts; Consents of Third Parties.

            (a) The execution and delivery of this Agreement, the acquisition of
the  Shares  by  Purchaser  and  the  consummation  of the  transactions  herein
contemplated,  and  the  compliance  with  the  provisions  and  terms  of  this
Agreement,  are not prohibited by the Articles of Incorporation or Bylaws of the
Purchaser  and will not violate,  conflict  with or result in a breach of any of
the terms or  provisions  of, or  constitute a default  under,  any court order,
indenture,  mortgage,  loan agreement, or other agreement or instrument to which
the Purchaser is a party or by which it is bound.

            (b) No consent, waiver, approval, order, permit or authorization of,
or declaration or filing with, or  notification  to, any person or  governmental
body is required on the part of the Purchaser in  connection  with the execution
and delivery of this  Agreement or the Purchaser  Documents or the compliance by
Purchaser with any of the provisions hereof or thereof.

      5.4 Litigation.

      There are no Legal  Proceedings  pending or, to the best  knowledge of the
Purchaser,  threatened  that are  reasonably  likely to prohibit or restrain the
ability  of the  Purchaser  to enter  into  this  Agreement  or  consummate  the
transactions contemplated hereby.

      5.5 Investment Intention.

      The Purchaser is acquiring the Shares for its own account,  for investment
purposes only and not with a view to the  distribution  (as such term is used in
Section 2(11) of the Securities Act of 1933, as amended (the  "Securities  Act")
thereof.  Purchaser  understands  that the Shares have not been registered under
the Securities Act and cannot be sold unless  subsequently  registered under the
Securities Act or an exemption from such registration is available.

                                       21
<PAGE>

      5.6 Broker.

      The  Purchaser  has  not  retained  any  broker  in  connection  with  any
transaction  contemplated by this  Agreement.  Sellers shall not be obligated to
pay any fee or  commission  associated  with the  retention or engagement by the
Purchaser of any broker in connection with any transaction  contemplated by this
Agreement.

                                   ARTICLE VI
                                    COVENANTS

      6.1 Access to Information.

      The Sellers and the Company  agree that,  prior to the Closing  Date,  the
Purchaser shall be entitled, through its officers, employees and representatives
(including,  without  limitation,  its legal advisors and accountants),  to make
such  investigation of the properties,  businesses and operations of the Company
and its Subsidiaries  and such  examination of the books,  records and financial
condition of the Company and its  Subsidiaries as it reasonably  requests and to
make extracts and copies of such books and records.  Any such  investigation and
examination   shall  be  conducted  during  regular  business  hours  and  under
reasonable  circumstances,  and the Sellers shall cooperate, and shall cause the
Company and its  Subsidiaries to cooperate,  fully therein.  No investigation by
the Purchaser  prior to or after the date of this  Agreement  shall  diminish or
obviate any of the representations,  warranties,  covenants or agreements of the
Sellers contained in this Agreement or the Seller  Documents.  In order that the
Purchaser may have full opportunity to make such physical, business,  accounting
and legal review,  examination or investigation as it may reasonably  request of
the  affairs of the Company and its  Subsidiaries,  the Sellers  shall cause the
officers,  employees,  consultants,  agents,  accountants,  attorneys  and other
representatives of the Company and its Subsidiaries to cooperate fully with such
representatives in connection with such review and examination.

6.2      Conduct of the Business Pending the Closing.

            (a) Except as otherwise expressly  contemplated by this Agreement or
with the prior written  consent of the Purchaser,  the Sellers shall,  and shall
cause the Company to:

                  (i) Conduct the businesses of the Company only in the ordinary
course consistent with past practice;

                  (ii) Use its best efforts to (A) preserve its present business
operations,  organization  (including,  without  limitation,  management and the
sales  force)  and  goodwill  of  the  Company  and  (B)  preserve  its  present
relationship with Persons having business dealings with the Company;

                                       22
<PAGE>

                  (iii)  Maintain  (A) all of the assets and  properties  of the
Company in their  current  condition,  ordinary  wear and tear  excepted and (B)
insurance  upon all of the  properties and assets of the Company in such amounts
and of such kinds com-parable to that in effect on the date of this Agreement;

                  (iv) (A)  maintain  the  books,  accounts  and  records of the
Company in the ordinary course of business  consistent with past practices,  (B)
continue to collect  accounts  receivable  and pay  accounts  payable  utilizing
normal  procedures  and  without  discounting  or  accelerating  payment of such
accounts,  and (C) comply with all contractual and other obligations  applicable
to the operation of the Company; and

                  (v) Comply in all material respects with applicable Laws.

            (b) Except as otherwise expressly  contemplated by this Agreement or
with the prior  written  consent of the  Purchaser,  the Sellers  shall not, and
shall cause the Company not to:

                  (i)  Declare,  set aside,  make or pay any  dividend  or other
distribution  in  respect of the  capital  stock of the  Company or  repurchase,
redeem or otherwise acquire any outstanding shares of the capital stock or other
securities of, or other ownership interests in, the Company;

                  (ii) Transfer, issue, sell or dispose of any shares of capital
stock or other  securities of the Company or grant options,  warrants,  calls or
other rights to purchase or  otherwise  acquire  shares of the capital  stock or
other securities of the Company;

                  (iii)  Effect any  recapitalization,  reclassification,  stock
split or like change in the capitalization of the Company;

                  (iv) Amend the certificate of  incorporation or by-laws of the
Company;

                  (v) (A) materially  increase the annual level of  compensation
of any  employee of the Company,  (B) increase the annual level of  compensation
payable or to become  payable by the Company to any of its  executive  officers,
(C) increase the  coverage or benefits  available  under any (or create any new)
severance  pay,   termination  pay,   vacation  pay,   company  awards,   salary
continuation for disability,  sick leave, deferred compensation,  bonus or other
incentive  compensation,  insurance,  pension or other employee  benefit plan or
arrangement  made to, for, or with any of the  directors,  officers,  employees,
agents  or  representatives  of the  Company  or  otherwise  modify  or amend or
terminate  any such  plan or  arrangement  or (D)  enter  into  any  employment,
deferred  compensation,   severance,  consulting,   non-competition  or  similar
agreement  (or amend any such  agreement)  to which  the  Company  is a party or
involving a director,  officer or employee of the Company in his or her capacity
as a  director,  officer or  employee of the  Company.  The Sellers  through the
Company  shall  have the  ability to direct  the  payment  of cash and  accounts
receivable to any Employee both prior to and after Closing.

                  (vi)  Except  for  trade  payables  and for  indebtedness  for
borrowed money incurred in the ordinary  course of business and consistent  with
past  practice,  borrow monies for any reason or draw down on any line of credit
or debt  obligation,  or become the  guarantor,  surety,  endorser or  otherwise
liable for any debt,  obligation or liability  (contingent  or otherwise) of any
other Person, or change the terms of payables or receivables;

                                       23
<PAGE>

                  (vii)  Subject  to any Lien  (except  for  leases  that do not
materially  impair the use of the property  subject thereto in their  respective
businesses as presently  conducted),  any of the  properties or assets  (whether
tangible or intangible) of the Company;

                  (viii)  Acquire  any  material  properties  or assets or sell,
assign,  transfer,  convey,  lease or  otherwise  dispose of any of the material
properties or assets (except for fair  consideration  in the ordinary  course of
business  consistent with past practice) of the Company except,  with respect to
the items listed on Schedule  6.2(b)(viii) hereto, as previously consented to by
the Purchaser;

                  (ix)  Cancel  or  compromise  any  debt or  claim  or waive or
release any  material  right of the  Company  except in the  ordinary  course of
business consistent with past practice;

                  (x) Enter into any commitment for capital  expenditures or the
purchase of assets out of the ordinary course in excess of $5,000;

                  (xi)  Permit the Company to enter into any  transaction  or to
make or enter into any Contract  which by reason of its size or otherwise is not
in the ordinary course of business consistent with past practice;

                  (xii)  Permit the Company to enter into or agree to enter into
any merger or  consolidation  with,  any  corporation  or other entity,  and not
engage in any new  business  or  invest  in,  make a loan,  advance  or  capital
contribution to, or otherwise acquire the securities of any other Person;

                  (xiii)  Except for  transfers of cash  pursuant to normal cash
management practices, permit the Company to make any investments in or loans to,
or pay any fees or expenses to, or enter into or modify any Contract  with,  the
Sellers or any Affiliate of the Sellers; or

                  (xiv) Agree to do anything  prohibited  by this Section 6.2 or
anything  which  would make any of the  representations  and  warranties  of the
Sellers in this  Agreement  or the Seller  Documents  untrue or incorrect in any
material respect as of any time through and including the Effective Time.

      6.3 Consents.

      The  Sellers  and the  Company  shall  use  their  best  efforts,  and the
Purchaser  shall  cooperate  with the Sellers and the Company,  to obtain at the
earliest  practicable date all consents and approvals required to consummate the
transactions contemplated by this Agreement,  including, without limitation, the
consents and  approvals  referred to in Section 4.7 hereof;  provided,  however,
that neither the Sellers,  the Company nor the  Purchaser  shall be obligated to
pay any consideration  therefor to any third party from whom consent or approval
is requested.

                                       24
<PAGE>

      6.4 Other Actions.

      Each of the  Sellers,  the  Company and the  Purchaser  shall use its best
efforts to (i) take all actions  necessary  or  appropriate  to  consummate  the
transactions  contemplated  by this Agreement and (ii) cause the  fulfillment at
the  earliest  practicable  date of all of the  conditions  to their  respective
obligations to consummate the transactions contemplated by this Agreement.

      6.5 No Solicitation.

      The Sellers  will not,  and will not cause or permit the Company or any of
the  Company's  directors,   officers,  employees,   representatives  or  agents
(collectively,  the "Representatives") to, directly or indirectly,  (i) discuss,
negotiate, undertake, authorize, recommend, propose or enter into, either as the
proposed surviving,  merged, acquiring or acquired corporation,  any transaction
involving a merger, consolidation, business combination, purchase or disposition
of any amount of the assets or capital  stock or other  equity  interest  in the
Company  other  than  the  transactions   contemplated  by  this  Agreement  (an
"Acquisition  Transaction"),  (ii)  facilitate,  encourage,  solicit or initiate
discussions, negotiations or submissions of proposals or offers in respect of an
Acquisition Transaction,  (iii) furnish or cause to be furnished, to any Person,
any information concerning the business, operations, properties or assets of the
Company  in  connection  with an  Acquisition  Transaction,  or  (iv)  otherwise
cooperate in any way with, or assist or participate in, facilitate or encourage,
any effort or attempt  by any other  Person to do or seek any of the  foregoing.
The Sellers  will inform the  Purchaser  in writing  immediately  following  the
receipt by Sellers, the Company or any Representative of any proposal or inquiry
in respect of any Acquisition Transaction.

      6.6 Preservation of Records.

      Subject to Section  9.4(e)  hereof  (relating to the  preservation  of Tax
records),  the Sellers and the Purchaser  agree that each of them shall preserve
and keep the records  held by it  relating to the  business of the Company for a
period of three  years from the  Closing  Date and shall make such  records  and
personnel  available to the other as may be reasonably required by such party in
connection with, among other things,  any insurance claims by, legal proceedings
against or governmental investigations of the Sellers or the Purchaser or any of
their  Affiliates  or in order to enable the Sellers or the  Purchaser to comply
with their respective obligations under this Agreement and each other agreement,
document or instrument contemplated hereby or thereby.

      6.7 Publicity.

      None of the Sellers,  the Company nor the Purchaser  shall issue any press
release or public  announcement  concerning  this Agreement or the  transactions
contemplated  hereby without  obtaining the prior written  approval of the other
party  hereto,  which  approval  will not be  unreasonably  withheld or delayed,
unless,  in the sole  judgment of the  Purchaser,  the  Company or the  Sellers,
disclosure is otherwise required by applicable Law or by the applicable rules of
any stock exchange on which the Purchaser  lists  securities,  provided that, to
the extent  required by applicable law, the party intending to make such release
shall use its best efforts  consistent  with such applicable law to consult with
the other party with respect to the text thereof.

                                       25
<PAGE>

      6.8 Use of Name.

      The Sellers hereby agrees that upon the  consummation of the  transactions
contemplated  hereby, the Purchaser and the Company shall have the sole right to
the  use of the  name  "National  Actuarial  Pension  Services,  Inc.",  and any
derivation of the aforementioned  names and the Sellers shall not, and shall not
cause or permit any  Affiliate  to, use such name or any variation or simulation
thereof.

      6.9 Employment Agreements.

      On or prior to the  Closing  Date,  each of the  Sellers  shall enter into
consulting agreements with the Company,  substantially in the form of agreements
attached hereto as Exhibit 6.9 (the "Employment Agreements").

      6.10 Non-Competition and Non-Solicitation Agreements.

      On or prior to the  Closing  Date,  each of the  Sellers  shall enter into
non-competition  and  non-solicitation  agreements  with the  Purchaser  and the
Company, substantially in the form of agreements attached hereto as Exhibit 6.10
(the "Non-Competition Agreements").

      6.11 Financial Statements.

      The Sellers shall deliver the Financial  Statements to the Purchaser on or
prior to the Closing Date.

      6.12 Tax Matters.

            (a) Tax Periods  Ending on or Before the Closing  Date.  The Sellers
shall  prepare  or cause to be  prepared  and file or cause to be filed  all Tax
Returns for the Company for all periods  through and  including the Closing Date
which are filed after the Closing Date as soon as  practicable  and prior to the
date due (including any proper extensions thereof). The Sellers shall permit the
Company and the Purchaser to review and provide  comments,  if any, on each such
Return described in the preceding sentence prior to filing. Unless the Purchaser
or the Company  provides  comments to the Sellers,  the Company shall deliver to
the Sellers each such Return signed by the appropriate officer(s) of the Company
for filing within ten (10) days  following the Sellers'  delivery to the Company
and the  Purchaser of any such Return.  The Sellers shall deliver to the Company
promptly  after  filing each such Return a copy of the filed Return and evidence
of its filing.  The  Sellers  shall pay the costs and  expenses  incurred in the
preparation  and filing of the Tax  Returns on or before the date such costs and
expenses are due.

            If the  Company  provide  comments  to the Sellers and at the end of
such ten (10) day  period  the  Company  and the  Sellers  have  failed to reach
written  agreement with respect to all of such disputed items, the parties shall
submit the unresolved  items to arbitration for final  determination.  Promptly,
but no later than thirty (30) days after its  acceptance of its  appointment  as
arbitrator, the arbitrator shall render an opinion as to the disputed items. The
determination  of the  arbitrator  shall  be  conclusive  and  binding  upon the
parties. The Company and the Sellers (as a group) shall each pay one half of the
fees, costs and expenses of the arbitrator. The prevailing party may be entitled
to an award of pre- and  post-award  interest as well as  reasonable  attorneys'
fees incurred in connection with the  arbitration  and any judicial  proceedings
related thereto as determined by the arbitrator.

                                       26
<PAGE>

            (b) Tax Periods  Beginning  and Ending After the Closing  Date.  The
Company or the Purchaser shall prepare or cause to be prepared and file or cause
to be filed any Returns of the Company for Tax periods  that begin and end after
the Closing Date.

            (c) Refunds and Tax  Benefits.  Any Tax  refunds  that are  received
after the  Closing  Date by the  Sellers  (other  than tax  refunds  received in
connection  with such Sellers'  individual  tax  Returns),  the Purchaser or the
Company,  and any  amounts  credited  against  Tax to  which  the  Sellers,  the
Purchaser  or the  Company  become  entitled,  shall be for the  account  of the
Company,  and the  Sellers  shall pay over to the Company any such refund or the
amount of any such credit within  fifteen (15) days after receipt or entitlement
thereto.  In  addition,  to the extent  that a claim for refund or a  proceeding
results in a payment or credit against Tax by a taxing authority to the Sellers,
the Sellers shall pay such amount to the Company  within fifteen (15) days after
receipt or entitlement thereto.

            (d) Cooperation on Tax Matters.

                  (i) The Purchaser, the Company and the Sellers shall cooperate
fully,  as and to the  extent  reasonably  requested  by  the  other  party,  in
connection  with the filing of any  Returns  pursuant  to this  Section  and any
audit,  litigation or other  proceeding with respect to Taxes.  Such cooperation
shall include the  retention and (upon the other party's  request) the provision
of records  and  information  which are  reasonably  relevant to any such audit,
litigation  or other  proceeding  and making  employees  available on a mutually
convenient  basis to  provide  additional  information  and  explanation  of any
material provided hereunder. The Company and the Sellers agree (A) to retain all
books and records with respect to Tax matters  pertinent to the Company relating
to any taxable period  beginning before the Closing Date until the expiration of
the statute of limitations  (and, to the extent notified by the Purchaser or the
Sellers,  any extensions thereof) of the respective tax periods, and to abide by
all record retention agreements entered into with any taxing authority,  and (B)
to give the  other  party  reasonable  written  notice  prior  to  transferring,
destroying or  discarding  any such books and records and, if the other party so
requests,  the Company or the Sellers, as the case may be, shall allow the other
party to take possession of such books and records.

                  (ii)  The  Purchaser  and  the  Sellers  further  agree,  upon
request,  to use their  commercially  reasonable  best  efforts  to  obtain  any
certificate  or other  document  from any  governmental  authority  or any other
Person as may be necessary to mitigate,  reduce or eliminate  any Tax that could
be imposed  (including,  but not limited to,  with  respect to the  transactions
contemplated hereby).

                                       27
<PAGE>

                  (iii)  The  Purchaser  and the  Sellers  further  agree,  upon
request,  to provide the other party with all information  that either party may
be  required  to  report  pursuant  to  ss.6043  of the  Code  and all  Treasury
Department Regulations promulgated thereunder.

                                  ARTICLE VII
                              CONDITIONS TO CLOSING

      7.1 Conditions Precedent to Obligations of Purchaser.

      The   obligation  of  the  Purchaser  to   consummate   the   transactions
contemplated by this Agreement is subject to the fulfillment, on or prior to the
Closing Date, of each of the  following  conditions  (any or all of which may be
waived  by the  Purchaser  in  whole  or in  part  to the  extent  permitted  by
applicable law):

      (a) all  representations  and  warranties  of the  Sellers and the Company
contained herein shall be true and correct as of the date hereof;

      (b) all  representations  and  warranties  of the  Sellers and the Company
contained herein qualified as to materiality shall be true and correct,  and the
representations  and warranties of the Sellers and the Company  contained herein
not  qualified  as to  materiality  shall be true and  correct  in all  material
respects,  at and as of the Closing  Date with the same  effect as though  those
representations and warranties had been made again at and as of that time;

      (c) the Sellers and the Company  shall have  performed and complied in all
material respects with all obligations and covenants  required by this Agreement
to be performed or complied with by them on or prior to the Closing Date;

      (d) the Purchaser shall have been furnished with  certificates  (dated the
Closing Date and in form and substance reasonably satisfactory to the Purchaser)
executed by each Sellers  certifying  as to the  fulfillment  of the  conditions
specified in Sections 7.1(a), 7.1(b) and 7.1(c) hereof;

      (e) Certificates representing 100% of the Shares shall have been, or shall
at the Closing be, validly delivered and transferred to the Purchaser,  free and
clear of any and all Liens;

      (f) there shall not have been or occurred any Material Adverse Change;

      (g) the Sellers and the  Company  shall have  obtained  all  consents  and
waivers referred to in Section 4.7 hereof, in a form reasonably  satisfactory to
the Purchaser,  with respect to the transactions  contemplated by this Agreement
and the Seller Documents;

      (h) no Legal Proceedings shall have been instituted or threatened or claim
or demand made against the Sellers,  the Company,  or the  Purchaser  seeking to
restrain  or  prohibit  or to obtain  substantial  damages  with  respect to the
consummation of the transactions  contemplated hereby, and there shall not be in
effect any order by a governmental body of competent  jurisdiction  restraining,
enjoining  or  otherwise   prohibiting  the  consummation  of  the  transactions
contemplated hereby;

                                       28
<PAGE>

      (i) the  Purchaser  shall have received the written  resignations  of each
director and officer of the Company;

      (j) the Employment  Agreements and  Non-Competition  Agreements shall have
been executed; and

      (k) the Purchaser shall have received information satisfactory in its sole
discretion to verify the accuracy of all financial  information delivered by the
Sellers to the Purchaser.

      7.2 Conditions Precedent to Obligations of the Sellers and the Company.

      The  obligations  of  the  Sellers  and  the  Company  to  consummate  the
transactions  contemplated  by this  Agreement  are subject to the  fulfillment,
prior to or on the Closing Date, of each of the following conditions (any or all
of which may be waived by the Sellers and the Company in whole or in part to the
extent permitted by applicable law):

      (a) all  representations  and warranties of the Purchaser contained herein
shall be true and correct as of the date hereof;

      (b) all  representations  and warranties of the Purchaser contained herein
qualified as to materiality shall be true and correct,  and all  representations
and warranties of the Purchaser contained herein not qualified as to materiality
shall be true and  correct in all  material  respects,  at and as of the Closing
Date with the same effect as though those  representations  and  warranties  had
been made again at and as of that date;

      (c) the  Purchaser  shall have  performed  and  complied  in all  material
respects with all  obligations  and covenants  required by this  Agreement to be
performed or complied with by Purchaser on or prior to the Closing Date;

      (d) the Sellers shall have been  furnished  with  certificates  (dated the
Closing Date and in form and substance  reasonably  satisfactory to the Sellers)
executed  by the Chief  Executive  Officer  and Chief  Financial  Officer of the
Purchaser  certifying  as to the  fulfillment  of the  conditions  specified  in
Sections 7.2(a), 7.2(b) and 7.2(c);

      (e) no Legal Proceedings shall have been instituted or threatened or claim
or demand made against the Sellers,  the Company,  or the  Purchaser  seeking to
restrain  or  prohibit  or to obtain  substantial  damages  with  respect to the
consummation of the transactions  contemplated hereby, and there shall not be in
effect any Order by a Governmental Body of competent  jurisdiction  restraining,
enjoining  or  otherwise   prohibiting  the  consummation  of  the  transactions
contemplated hereby;

                                       29
<PAGE>

      (f) The Employment  Agreements and  Non-Competition  Agreements shall have
been executed by the Purchaser.

                                  ARTICLE VIII
                            DOCUMENTS TO BE DELIVERED

      8.1 Documents to be Delivered by the Sellers.

      At the Closing,  the Sellers shall deliver,  or cause to be delivered,  to
the Purchaser the following:

      (a) stock certificates  representing the Shares, duly endorsed in blank or
accompanied by stock transfer  powers and with all requisite  stock transfer tax
stamps attached;

      (b) the certificates referred to in Section 7.1(d) and 7.1(e) hereof;

      (c) copies of all  consents  and  waivers  referred  to in Section  7.1(g)
hereof;

      (d)  the  Employment  Agreements  and  Non-Competition   Agreements,  duly
executed by all parties other than the Purchaser;

      (e) written  resignations  of certain of the officers and the directors of
the Company;

      (f) certificate of good standing with respect to the Company issued by the
Secretary  of State of the State of  incorporation,  and for each state in which
the Company is qualified to do business as a foreign corporation; and

      (g) such other documents as the Purchaser shall reasonably request.

      8.2 Documents to be Delivered by the Purchaser.

      At the Closing, the Purchaser shall deliver to the Sellers the following:

      (a) The Purchase Price;

      (b) the Notes;

      (b) the certificates referred to in Section 7.2(d) hereof;

      (c)  the  Employment  Agreements  and  Non-Competition   Agreements,  duly
executed by the Company or the Purchaser; and

      (d) such other documents as the Sellers shall reasonably request.

                                       30
<PAGE>

                                   ARTICLE IX
                                 INDEMNIFICATION

      9.1 Indemnification.

            (a)  Subject to Section  9.2 hereof,  the  Sellers  hereby  agree to
jointly and severally indemnify and hold the Purchaser,  the Company,  and their
respective directors,  officers, employees,  Affiliates,  agents, successors and
assigns  (collectively,  the "Purchaser  Indemnified Parties") harmless from and
against:

                  (i) any and all  liabilities  of the  Company  of every  kind,
nature and description,  absolute or contingent, existing as against the Company
prior to and  including  the  Closing  Date or  thereafter  coming into being or
arising by reason of any state of facts  existing,  or any  transaction  entered
into, on or prior to the Closing  Date,  except to the extent that the same have
been fully  provided for in the Balance  Sheet or disclosed in the notes thereto
or were  incurred in the ordinary  course of business  between the Balance Sheet
date and the Closing Date;

                  (ii) subject to Section 10.3, any and all losses, liabilities,
obligations,  damages,  costs  and  expenses  based  upon,  attributable  to  or
resulting from the failure of any  representation or warranty of the Sellers set
forth in Section 4 hereof, or any  representation  or warranty  contained in any
certificate delivered by or on behalf of the Sellers pursuant to this Agreement,
to be true and correct in all respects as of the date made;

                  (iii) any and all losses, liabilities,  obligations,  damages,
costs and expenses based upon,  attributable  to or resulting from the breach of
any covenant or other agreement on the part of the Sellers under this Agreement;

                                       31
<PAGE>

                  (iv) any and all notices, actions, suits, proceedings, claims,
demands,  assessments,  judgments,  costs,  penalties  and  expenses,  including
attorneys'  and  other  professionals'  fees  and  disbursements  (collectively,
"Expenses") incident to any and all losses, liabilities,  obligations,  damages,
costs and expenses with respect to which  indemnification  is provided hereunder
(collectively, "Losses").

            (b) Subject to Section 9.2, Purchaser hereby agrees to indemnify and
hold the Sellers and their respective Affiliates, agents, successors and assigns
(collectively, the "Sellers Indemnified Parties") harmless from and against:

                  (i)  any  and  all  Losses  based  upon,  attributable  to  or
resulting  from the failure of any  representation  or warranty of the Purchaser
set forth in Section 5 hereof, or any  representation  or warranty  contained in
any  certificate  delivered  by or on behalf of the  Purchaser  pursuant to this
Agreement, to be true and correct as of the date made;

                  (ii)  any  and  all  Losses  based  upon,  attributable  to or
resulting from the breach of any covenant or other  agreement on the part of the
Purchaser under this Agreement or arising from the ownership or operation of the
Company from and after the Closing Date; and

                  (iii) any and all Expenses incident to the foregoing.

      9.2 Limitations on  Indemnification  for Breaches of  Representations  and
Warranties.

      An  indemnifying   party  shall  not  have  any  liability  under  Section
9.1(a)(ii),  (iii) or (iv),  or  Section  9.1(b)  hereof or  otherwise  (but not
including  Section  9.1(a)(i) unless the aggregate amount of Losses and Expenses
to the indemnified  parties finally  determined to arise  thereunder based upon,
attributable to or resulting from the failure of any  representation or warranty
to be true and correct,  other than the representations and warranties set forth
in Sections 4.3, 4.11, 4.24 and 4.29 hereof, exceeds $25,000 (the "Basket") and,
in such event, the indemnifying party shall be required to pay the entire amount
of such Losses and Expenses in excess of $25,000 (the "Deductible").

      9.3 Indemnification Procedures.

            (a) In the event that any Legal  Proceedings  shall be instituted or
that any claim or demand ("Claim") shall be asserted by any Person in respect of
which payment may be sought under Section 9.1 hereof  (regardless  of the Basket
or the Deductible referred to above), the indemnified party shall reasonably and
promptly  cause  written  notice of the  assertion  of any Claim of which it has
knowledge which is covered by this indemnity to be forwarded to the indemnifying
party.  The  indemnifying  party  shall have the right,  at its sole  option and
expense,  to be represented  by counsel of its choice,  which must be reasonably
satisfactory to the indemnified party, and to defend against,  negotiate, settle
or otherwise deal with any Claim which relates to any Losses indemnified against
hereunder. If the indemnifying party elects to defend against, negotiate, settle
or otherwise deal with any Claim which relates to any Losses indemnified against
hereunder,  it shall within five (5) days (or sooner, if the nature of the Claim
so  requires)  notify  the  indemnified  party of its  intent  to do so.  If the
indemnifying party elects not to defend against,  negotiate, settle or otherwise
deal with any Claim which relates to any Losses  indemnified  against hereunder,
fails to notify the  indemnified  party of its  election  as herein  provided or
contests its obligation to indemnify the indemnified party for such Losses under
this Agreement, the indemnified party may defend against,  negotiate,  settle or
otherwise deal with such Claim. If the indemnified party defends any Claim, then
the indemnifying party shall reimburse the indemnified party for the Expenses of
defending  such Claim upon  submission of periodic  bills.  If the  indemnifying
party  shall  assume  the  defense  of any  Claim,  the  indemnified  party  may
participate,  at his or its own expense, in the defense of such Claim; provided,
however,  that such  indemnified  party shall be entitled to  participate in any
such defense with separate counsel at the expense of the indemnifying  party if,
(i) so  requested  by the  indemnifying  party  to  participate  or  (ii) in the
reasonable  opinion of counsel to the indemnified party, a conflict or potential
conflict exists between the indemnified  party and the  indemnifying  party that
would make such separate representation  advisable; and provided,  further, that
the  indemnifying  party  shall  not be  required  to pay for more than one such
counsel for all indemnified  parties in connection  with any Claim.  The parties
hereto agree to cooperate  fully with each other in connection with the defense,
negotiation or settlement of any such Claim.

            (b) After any final  judgment or award shall have been rendered by a
court,  arbitration board or administrative agency of competent jurisdiction and
the expiration of the time in which to appeal  therefrom,  or a settlement shall
have been consummated, or the indemnified party and the indemnifying party shall
have arrived at a mutually binding  agreement with respect to a Claim hereunder,
the indemnified party shall forward to the indemnifying party notice of any sums
due and owing by the indemnifying  party pursuant to this Agreement with respect
to such  matter and the  indemnifying  party shall be required to pay all of the
sums so due and owing to the  indemnified  party by wire transfer of immediately
available funds within 10 business days after the date of such notice.

                                       32
<PAGE>

            (c) The failure of the indemnified  party to give reasonably  prompt
notice  of  any  Claim  shall  not  release,   waive  or  otherwise  affect  the
indemnifying  party's obligations with respect thereto except to the extent that
the indemnifying  party can demonstrate actual loss and prejudice as a result of
such failure.

      9.4 Tax Treatment of Indemnity Payments.

      The Sellers and the Purchaser  agree to treat any  indemnity  payment made
pursuant to this Article 9 as an adjustment  to the Purchase  Price for federal,
state, local and foreign income tax purposes.

      9.5 Limitations.  Except for claims related to (i) fraud,  illegal acts or
willful  misconduct of Sellers,  or (ii) title to or transfer of the Shares, the
provisions of this Article 9 shall constitute  Purchaser's  exclusive remedy for
breaches   of   Sellers'   representations,   warranties   or   covenants.   Any
indemnification  payments  required  pursuant to this Article 9 shall be made in
the  following  order of priority:  (i) first from payments due under the Notes,
(ii) second from payments due under the  Employment  Agreements  of Seller,  and
(iii) third from the Sellers. The aggregate  obligations of the Sellers pursuant
to Article 9 shall not exceed the Purchase Price.

                                   ARTICLE X
                                  MISCELLANEOUS

      10.1 Payment of Sales, Use or Similar Taxes.

      All sales, use, transfer,  intangible,  recordation,  documentary stamp or
similar Taxes or charges, of any nature whatsoever,  applicable to, or resulting
from, the  transactions  contemplated  by this  Agreement  shall be borne by the
Sellers.

      10.2 Survival of Representations and Warranties.

      The parties  hereto hereby agree that the  representations  and warranties
contained  in this  Agreement  or in any  certificate,  document  or  instrument
delivered in  connection  herewith,  shall survive the execution and delivery of
this Agreement, and the Closing hereunder,  regardless of any investigation made
by the  parties  hereto;  provided,  however,  that any claims or  actions  with
respect  thereto  (other than claims for  indemnifications  with  respect to the
representation  and  warranties  contained in Sections  4.3, 4.11 and 4.24 which
shall  survive  for  periods   coterminous  with  any  applicable   statutes  of
limitation)  shall  terminate  unless within  twenty-four  (24) months after the
Closing  Date  written  notice of such  claims is given to the  Sellers  or such
actions are commenced.

                                       33
<PAGE>

      10.3 Expenses.

      Except as  otherwise  provided  in this  Agreement,  the  Sellers  and the
Purchaser  shall each bear its own  expenses  incurred  in  connection  with the
negotiation and execution of this Agreement and each other  agreement,  document
and  instrument  contemplated  by this  Agreement  and the  consummation  of the
transactions  contemplated  hereby and thereby,  it being  understood that in no
event shall the Company bear any of such costs and expenses.

      10.4 Specific Performance.

      The Sellers and the Company  acknowledge and agree that the breach of this
Agreement would cause irreparable damage to the Purchaser and that the Purchaser
will not have an  adequate  remedy at law.  Therefore,  the  obligations  of the
Sellers and the Company under this Agreement, including, without limitation, the
Sellers' obligation to sell the Shares to the Purchaser, shall be enforceable by
a decree of specific performance issued by any court of competent  jurisdiction,
and appropriate  injunctive  relief may be applied for and granted in connection
therewith.  Such remedies  shall,  however,  be cumulative and not exclusive and
shall be in addition to any other  remedies  which any party may have under this
Agreement or otherwise.

      10.5 Further Assurances.

      The Sellers  and the  Purchaser  each  agrees to execute and deliver  such
other documents or agreements and to take such other action as may be reasonably
necessary  or  desirable  for  the  implementation  of  this  Agreement  and the
consummation of the transactions contemplated hereby.

      10.6 Submission to Jurisdiction; Consent to Service of Process.

            (a)  The   parties   hereto   hereby   irrevocably   submit  to  the
non-exclusive  jurisdiction  of any  federal or state court  located  within the
state of New York over any dispute  arising out of or relating to this Agreement
or any of the transactions contemplated hereby and each party hereby irrevocably
agrees that all claims in respect of such dispute or any suit, action proceeding
related  thereto may be heard and determined in such courts.  The parties hereby
irrevocably  waive,  to the fullest  extent  permitted  by  applicable  law, any
objection  which  they may now or  hereafter  have to the laying of venue of any
such dispute brought in such court or any defense of inconvenient  forum for the
maintenance  of such dispute.  Each of the parties hereto agrees that a judgment
in any  such  dispute  may be  enforced  in other  jurisdictions  by suit on the
judgment or in any other manner provided by law.

            (b) Each of the parties  hereto  hereby  consents  to process  being
served by any party to this  Agreement in any suit,  action or proceeding by the
mailing of a copy thereof in accordance with the provisions of Section 10.10.

      10.7 Entire Agreement; Amendments and Waivers.

                                       34
<PAGE>

      This Agreement  (including the schedules and exhibits  hereto)  represents
the entire  understanding  and agreement between the parties hereto with respect
to the subject matter hereof and can be amended,  supplemented  or changed,  and
any provision hereof can be waived,  only by written  instrument making specific
reference to this Agreement  signed by the party against whom enforcement of any
such amendment,  supplement,  modification or waiver is sought.  No action taken
pursuant to this Agreement,  including without limitation,  any investigation by
or on behalf of any party,  shall be deemed to  constitute a waiver by the party
taking such action of compliance with any representation,  warranty, covenant or
agreement  contained  herein.  The waiver by any party hereto of a breach of any
provision  of this  Agreement  shall not operate or be construed as a further or
continuing  waiver of such  breach  or as a waiver  of any  other or  subsequent
breach.  No  failure  on the  part of any  party  to  exercise,  and no delay in
exercising,  any  right,  power or remedy  hereunder  shall  operate as a waiver
thereof, nor shall any single or partial exercise of such right, power or remedy
by such party preclude any other or further  exercise thereof or the exercise of
any other right,  power or remedy. All remedies hereunder are cumulative and are
not exclusive of any other remedies provided by law.

      10.8 Governing  Law. This Agreement  shall be governed by and construed in
accordance with the laws of the state of New York.

      10.9 Table of Contents and Headings.

      The table of contents  and  section  headings  of this  Agreement  are for
reference  purposes  only and are to be given no effect in the  construction  or
interpretation of this Agreement.

      10.10 Notices.

      All  notices and other  communications  under this  Agreement  shall be in
writing  and  shall be  deemed  given  when  delivered  personally  or mailed by
certified  mail,  return  receipt  requested,  to the parties (and shall also be
transmitted  by  facsimile  to the  Persons  receiving  copies  thereof)  at the
following  addresses (or to such other address as a party may have  specified by
notice given to the other party pursuant to this provision):

      (a) Purchaser:

             National Investment Managers Inc.
             420 Lexington Avenue
             New York, New York 10170
             Attn:  Leonard Neuhaus, COO/CFO
             Phone:     (212) 389-7832
             Facsimile: (212) 389-7831

             Copy to:

             Gregory Sichenzia, Esq.
             Sichenzia Ross Friedman Ference LLP
             1065 Avenue of the Americas
             New York, New York 10018
             Phone:     (212) 930-9700
             Facsimile: (212) 930-9725

                                       35
<PAGE>

      (b) Sellers and Company:

             Mr. Charles N. McLeod Ms. Mary H. McLeod
             National Actuarial Pension Services, Inc.
             10777 Westheimer. Suite 220
             Houston, Texas 77042
             Phone:      (   )
             Facsimile:  (   )

             Copy to:

             Barry W. Adkins
             Chamberlain, Hrdlicka, White, Williams & Martin
             1200 Smith Street, Suite 1400
             Houston, Texas 77002
             Phone:     713.658.2543
             Facsimile: 713.658.2553

      10.11 Severability.

      If any  provision  of this  Agreement  is  invalid or  unenforceable,  the
balance of this Agreement shall remain in effect.

      10.12 Binding Effect; Assignment.

      This  Agreement  shall be  binding  upon and inure to the  benefit  of the
parties and their respective  successors and permitted assigns.  Nothing in this
Agreement shall create or be deemed to create any third party beneficiary rights
in any person or entity not a party to this Agreement  except as provided below.
No assignment of this Agreement or of any rights or obligations hereunder may be
made by either the Sellers or the  Purchaser  (by operation of law or otherwise)
without the prior written  consent of the other parties hereto and any attempted
assignment without the required consents shall be void; provided,  however, that
the  Purchaser may assign this  Agreement  and any or all rights or  obligations
hereunder (including, without limitation, the Purchaser's rights to purchase the
Shares and the  Purchaser's  rights to seek  indemnification  hereunder)  to any
Affiliate of the Purchaser.  Upon any such permitted assignment,  the references
in this Agreement to the Purchaser  shall also apply to any such assignee unless
the context otherwise requires.

                              [intentionally blank]

                                       36
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first above written.

                                       NATIONAL INVESTMENT MANAGERS INC.

                                       By: /s/Leonard Neuhaus
                                           -----------------------------
                                       Name:  Leonard Neuhaus
                                       Title: CFO/COO

                                       NATIONAL ACTUARIAL PENSION SERVICES, INC.

                                       By: /s/Charles N. McLeod
                                           -----------------------------
                                       Name:  Charles N. McLeod
                                       Title: President

                                           /s/ Charles N. McLeod
                                           -----------------------------
                                           Charles N. McLeod

                                           /s/Mary H. McLeod
                                           -----------------------------
                                           Mary H. McLeod

                                       37

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