Document:

Exhibit 10.19

                               EXCHANGE AGREEMENT
                               ------------------

         This Exchange Agreement ("Agreement") is dated as of January 31, 2007,
by and between FreeHand Systems International, Inc., a Delaware corporation (the
"Company"), and the holder of certain warrants issued by the Company whose
signature appears on the signature page attached hereto (the "Holder").

                                    Recitals:
                                    ---------

         WHEREAS, the Holder currently holds the following warrants of the
Company issued to the Holder pursuant to the Common Stock and Warrant Purchase
Agreement dated as of September 26, 2006 by and between the Holder and the
Company: (a) a Series J Warrant (the "Series J Warrant") to purchase 4,000,000
shares of common stock of the Company, par value $.001 per share (the "Common
Stock"), issued on September 26, 2006 and expiring on September 26, 2007, at an
exercise price per share of $0.75; (b) a Series D Warrant (the "Series D
Warrant") to purchase 2,000,000 shares of Common Stock issued on September 26,
2006 and expiring on September 26, 2011, at an exercise price per share of
$0.90; (c) a Series E Warrant (the "Series E Warrant") to purchase 2,000,000
shares of Common Stock issued on September 26, 2006 and expiring on September
26, 2011, at an exercise price per share of $1.25; and (d) a Series F Warrant
(the "Series F Warrant" and collectively with the Series J Warrant, the Series D
Warrant and the Series E Warrant, the "2006 Warrants") to purchase 2,000,000
shares of Common Stock issued on September 26, 2006 and expiring on September
26, 2011, at an exercise price per share of $1.60.

         WHEREAS, subject to the terms and conditions set forth herein, the
Company and the Holder desire to cancel and terminate the Series J Warrant in
exchange for the following warrants: (a) a new Series J Warrant (the "2007
Series J Warrant") to purchase 120 shares of Series C convertible preferred
stock of the Company, par value $.001 per share and stated value $25,000 per
share (the "Series C Preferred Stock"), at an exercise price of $25,000 per
share of Series C Preferred Stock, in substantially the form attached hereto as
Exhibit A; (b) a Series G Warrant (the "2007 Series G Warrant") to purchase
4,000,000 shares of Common Stock expiring on January __, 2012, at an exercise
price per share of $1.00, in substantially the form attached hereto as Exhibit
B; and (c) a Series H Warrant (the "2007 Series H Warrant" and collectively with
the 2007 Series J Warrant and the 2007 Series G Warrant, the "2007 Warrants"),
to purchase 4,000,0000 shares of Common Stock expiring on January __, 2012, at
an exercise price per share of $1.50, in substantially the form attached hereto
as Exhibit C.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby agreed and acknowledged, the parties hereto
hereby agree as follows:

                                   AGREEMENT:

         1.       Securities Exchange.
                  -------------------

                  (a)      Upon the following terms and subject to the
conditions contained herein, the Holder agrees to have the Series J Warrant
cancelled in exchange for the 2007 Warrants. In consideration of and in express
reliance upon the representations, warranties, covenants, terms and conditions
of this Agreement, the Holder agrees to the cancellation of the Series J Warrant

<PAGE>

and the Company agrees to issue and deliver the 2007 Warrants. With respect to
each of the Series D Warrant, the Series E Warrant and the Series F Warrant (the
"Existing Warrants"), notwithstanding anything to the contrary contained in
Section 2(a) of each of the Existing Warrants, the Company and the Holder hereby
agree that each such Existing Warrant shall be exercisable commencing on the day
the 2007 Series J Warrant has been exercised by the Holder, and otherwise on
terms and conditions set forth in the respective Existing Warrant.

                  (b)      The closing under this Agreement (the "Closing")
shall take place at the offices of Kramer Levin Naftalis & Frankel LLP, 1177
Avenue of the Americas, New York, NY 10036 upon the satisfaction of each of the
conditions set forth in Sections 4 and 5 hereof (the "Closing Date"). At the
Closing, the Company shall issue to the Holder the 2007 Warrants and the Holder
shall deliver to the Company for cancellation the 2006 Warrants.

                  (c)      The designation, rights, preferences and other terms
and provisions of the Series C Preferred Stock are set forth in the Certificate
of Designation of the Relative Rights and Preferences of the Series C
Convertible Preferred Stock attached hereto as Exhibit D (the "Certificate of
Designation").

                  (d)      The 2007 Warrants, the shares of Series C Preferred
Stock issuable upon exercise of the 2007 Series J Warrant and the shares of
Common Stock issuable upon exercise of the 2007 Warrants and conversion of the
Series C Preferred Stock are sometimes collectively referred to herein as the
"Securities".

         2.       Representations, Warranties and Covenants of the Holder. The
Holder hereby makes the following representations and warranties to the Company,
and covenants for the benefit of the Company:

                  (a)      The Holder is a corporation, limited liability
company or partnership duly incorporated or organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation or
organization.

                  (b)      This Agreement has been duly authorized, validly
executed and delivered by the Holder and is a valid and binding agreement and
obligation of the Holder enforceable against the Holder in accordance with its
terms, subject to limitations on enforcement by general principles of equity and
by bankruptcy or other laws affecting the enforcement of creditors' rights
generally, and the Holder has full power and authority to execute and deliver
the Agreement and the other agreements and documents contemplated hereby and to
perform its obligations hereunder and thereunder.

                  (c)      The Holder understands that the Securities are being
offered and sold to it in reliance on specific provisions of Federal and state
securities laws and that the Company is relying upon the truth and accuracy of
the representations, warranties, agreements, acknowledgments and understandings
of the Holder set forth herein for purposes of qualifying for exemptions from
registration under the Securities Act of 1933, as amended (the "Securities Act")
and applicable state securities laws.

                  (d)      The Holder is an "accredited investor" as defined
under Rule 501 of Regulation D promulgated under the Securities Act.

                                       2
<PAGE>

                  (e)      The Holder is and will be acquiring the Securities
for the Holder's own account, and not with a view to any resale or distribution
in whole or in part, in violation of the Securities Act or any applicable
securities laws.

                  (f)      The offer and sale of the Securities is intended to
be exempt from registration under the Securities Act, by virtue of Section
3(a)(9) and/or 4(2) thereof. The Holder understands that the Securities
purchased hereunder have not been, and may never be, registered under the
Securities Act and that none of the Securities can be sold or transferred unless
they are first registered under the Securities Act and such state and other
securities laws as may be applicable or the Company receives an opinion of
counsel reasonably acceptable to the Company that an exemption from registration
under the Securities Act is available (and then the Securities may be sold or
transferred only in compliance with such exemption and all applicable state and
other securities laws).

                  (g)      The Holder has not employed any broker or finder or
incurred any liability for any brokerage or investment banking fees,
commissions, finders' structuring fees, financial advisory fees or other similar
fees in connection with any of the transactions contemplated by this Agreement.

         3.       Representations, Warranties and Covenants of the Company. The
Company represents and warrants to the Holder, and covenants for the benefit of
the Holder, as follows:

                  (a)      The Company has been duly incorporated and is validly
existing and in good standing under the laws of the state of Delaware, with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as currently conducted, and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure to
register or qualify would not have a Material Adverse Effect. For purposes of
this Agreement, "Material Adverse Effect" shall mean any effect on the business,
results of operations, prospects, assets or financial condition of the Company
that is material and adverse to the Company and its subsidiaries and affiliates,
taken as a whole and/or any condition, circumstance, or situation that would
prohibit or otherwise materially interfere with the ability of the Company from
entering into and performing any of its obligations under this Agreement in any
material respect; provided, however, that the foregoing shall not include
operating losses of the Company in the amounts contemplated by the Commission
Documents.

                  (b)      The Securities have been duly authorized by all
necessary corporate action and, when paid for or issued in accordance with the
terms hereof, the Securities shall be validly issued and outstanding, fully paid
and nonassessable, free and clear of all liens, encumbrances and rights of
refusal of any kind.

                  (c)      This Agreement has been duly authorized, validly
executed and delivered on behalf of the Company and is a valid and binding
agreement and obligation of the Company enforceable against the Company in
accordance with its terms, subject to limitations on enforcement by general
principles of equity and by bankruptcy or other laws affecting the enforcement
of creditors' rights generally, and the Company has full power and authority to

                                       3
<PAGE>

execute and deliver the Agreement and the other agreements and documents
contemplated hereby and to perform its obligations hereunder and thereunder.

                  (d)      The execution and delivery of the Agreement and the
consummation of the transactions contemplated by this Agreement by the Company,
will not (i) conflict with or result in a breach of or a default under any of
the terms or provisions of, (A) the Company's certificate of incorporation or
by-laws, or (B) of any material provision of any indenture, mortgage, deed of
trust or other material agreement or instrument to which the Company is a party
or by which it or any of its material properties or assets is bound, (ii) result
in a violation of any provision of any law, statute, rule, regulation, or any
existing applicable decree, judgment or order by any court, Federal or state
regulatory body, administrative agency, or other governmental body having
jurisdiction over the Company, or any of its material properties or assets or
(iii) result in the creation or imposition of any material lien, charge or
encumbrance upon any material property or assets of the Company or any of its
subsidiaries pursuant to the terms of any agreement or instrument to which any
of them is a party or by which any of them may be bound or to which any of their
property or any of them is subject except in the case of clauses (i)(B), (ii) or
(iii) for any such conflicts, breaches, or defaults or any liens, charges, or
encumbrances which would not have a Material Adverse Effect.

                  (e)      The delivery and issuance of the Securities in
accordance with the terms of and in reliance on the accuracy of the Holder's
representations and warranties set forth in this Agreement will be exempt from
the registration requirements of the Securities Act.

                  (f)      No consent, approval or authorization of or
designation, declaration or filing with any governmental authority on the part
of the Company is required in connection with the valid execution and delivery
of this Agreement or the offer, sale or issuance of the Securities or the
consummation of any other transaction contemplated by this Agreement (other than
any filings which may be required to be made by the Company with the Secretary
of State of Delaware or the Commission or pursuant to any state or "blue sky"
securities laws subsequent to the Closing).

                  (g)      There is no action, suit, claim, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company which questions the validity of this Agreement or the transactions
contemplated hereby or any action taken or to be taken pursuant thereto. There
is no action, suit, claim, investigation or proceeding pending or, to the
knowledge of the Company, threatened, against or involving the Company or any
subsidiary, or any of their respective properties or assets which, if adversely
determined, is reasonably likely to result in a Material Adverse Effect.

                  (h)      The Company has complied and will comply with all
applicable federal and state securities laws in connection with the offer,
issuance and delivery of the 2007 Warrants hereunder. Neither the Company nor
anyone acting on its behalf, directly or indirectly, has or will sell, offer to
sell or solicit offers to buy any of the 2007 Warrants, or similar securities
to, or solicit offers with respect thereto from, or enter into any preliminary
conversations or negotiations relating thereto with, any person, or has taken or
will take any action so as to bring the issuance and sale of any of the
Securities under the registration provisions of the Securities Act and
applicable state securities laws. Neither the Company nor any of its affiliates,

                                       4
<PAGE>

nor any person acting on its or their behalf, has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D under
the Securities Act) in connection with the offer or sale of any of the
Securities.

                  (i)      The Company has not employed any broker or finder or
incurred any liability for any brokerage or investment banking fees,
commissions, finders' structuring fees, financial advisory fees or other similar
fees in connection with any of the transactions contemplated by this Agreement.
[Can the Company make this rep? My understanding is that a placement agent may
be involved and receiving a fee upon the closing of this transaction. Please
confirm with Company]

         4.       Conditions Precedent to the Obligation of the Company to Issue
the 2007 Warrants. The obligation hereunder of the Company to issue and deliver
the 2007 Warrants to the Holder is subject to the satisfaction or waiver, at or
before the Closing Date, of each of the conditions set forth below. These
conditions are for the Company's sole benefit and may be waived by the Company
at any time in its sole discretion.

                  (a)      The Holder shall have executed and delivered the
Agreement.

                  (b)      The Series J Warrant shall have been delivered to the
Company for cancellation.

                  (c)      The representations and warranties of the Holder
shall be true and correct in all respects as of the date when made and as of the
Closing Date as though made at that time, except for representations and
warranties that are expressly made as of a particular date, which shall be true
and correct in all respects as of such date.

         5.       Conditions Precedent to the Obligation of the Holder to Accept
the 2007 Warrants. The obligation hereunder of the Holder to accept the 2007
Warrants is subject to the satisfaction or waiver, at or before the Closing
Date, of each of the conditions set forth below. These conditions are for the
Holder's sole benefit and may be waived by the Holder at any time in its sole
discretion.

                  (a)      The Company shall have executed and delivered the
Agreement.

                  (b)      Each of the representations and warranties of the
Company shall be true and correct in all respects as of the date when made and
as of the Closing Date as though made at that time, except for representations
and warranties that speak as of a particular date, which shall be true and
correct in all respects as of such date.

                  (c)      No statute, regulation, executive order, decree,
ruling or injunction shall have been enacted, entered, promulgated or endorsed
by any court or governmental authority of competent jurisdiction which prohibits
the consummation of any of the transactions contemplated by this Agreement at or
prior to the Closing Date.

                  (d)      As of the Closing Date, no action, suit or proceeding
before or by any court or governmental agency or body, domestic or foreign,
shall be pending against or affecting the Company, or any of its properties,
which questions the validity of the Agreement or the transactions contemplated

                                       5
<PAGE>

thereby or any action taken or to be taken pursuant thereto. As of the Closing
Date, no action, suit, claim or proceeding before or by any court or
governmental agency or body, domestic or foreign, shall be pending against or
affecting the Company, or any of its properties, which, if adversely determined,
is reasonably likely to result in a Material Adverse Effect.

                  (e)      The 2007 Warrants shall have been duly executed and
delivered to the Holder.

                  (f)      The Certificate of Designation shall have been filed
with the Delaware Secretary of State.

                  (g)      The Company shall have delivered on the Closing Date
to the Holder (i) a certified copy of the resolutions of the board of directors
of the Company authorizing the transactions contemplated by this Agreement and
(ii) a certified copy of the Certificate of Designation evidencing its
acceptance with the Delaware Secretary of State.

                  (h)      At the Closing, the Holder shall have received an
opinion of counsel to the Company, dated the date of the Closing, in the form of
Exhibit E hereto.

                  (i)      No Material Adverse Effect shall have occurred at or
before the Closing Date.

         6.       Fees and Expenses. Each party shall pay the fees and expenses
of its advisors, counsel, accountants and other experts, if any, and all other
expenses, incurred by such party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement, provided, however, that
the Company shall pay all reasonable attorneys' fees and expenses (exclusive of
disbursements and out-of-pocket expenses) incurred by the Holder in connection
with the preparation, negotiation, execution and delivery of this Agreement, the
Certificate of Designation and the 2007 Warrants.

         7.       Registration Rights. The Holder shall be entitled to all of
the benefits and subject to all of the obligations pursuant to that certain
Registration Rights Agreement dated as of September 26, 2006 by and between the
Holder and the Company (the "Registration Rights Agreement"). The parties hereto
acknowledge and agree that "Registrable Securities" as defined in the
Registration Rights Agreement shall be deemed to include (a) the shares of
Common Stock issuable upon exercise of the 2007 Warrants and (b) the shares of
Common Stock issuable upon the conversion of the Series C Preferred Stock
issuable upon exercise of the 2007 Series J Warrant. The Holder agrees that any
and all liquidated damages that have accrued and may accrue in the future
pursuant to the Registration Rights Agreement are hereby waived.

                                       6
<PAGE>

         8.       Post-Closing Covenant of the Holder. The Holder hereby
covenants and agrees that, on the Business Day (as defined below) immediately
following the Closing Date, the Holder shall exercise in full the 2007 Series J
Warrant by delivering the Exercise Form attached thereto at the principal office
of the Company, and by the payment to the Company of the full amount of
consideration therefor, all in accordance with the terms and conditions set
forth in the 2007 Series J Warrant. For purposes hereof, the term "Business Day"
shall mean any day except Saturday, Sunday and any day which shall be a legal
holiday or a day on which banking institutions in the State of New York
generally are authorized or required by law or other government actions to
close.

         9.       Indemnification. Each party hereto hereby agrees to indemnify
and hold harmless the other party hereto and such party's officers, directors,
shareholders, employees, agents and attorneys against any and all losses,
claims, damages, liabilities and reasonable expenses (collectively "Claims")
incurred by each such person in connection with defending or investigating any
such Claims, whether or not resulting in any liability to such person, to which
any such indemnified party may become subject, insofar as such Claims arise out
of or are based upon any breach of any representation or warranty or agreement
made by the indemnifying party in this Agreement.

         10.      Governing Law; Consent to Jurisdiction. This Agreement shall
be governed by and interpreted in accordance with the laws of the State of New
York without giving effect to the rules governing the conflicts of laws. Each of
the parties consents to the exclusive jurisdiction of the Federal courts whose
districts encompass any part of the County of New York located in the City of
New York in connection with any dispute arising under this Agreement and hereby
waives, to the maximum extent permitted by law, any objection, including any
objection based on forum non conveniens, to the bringing of any such proceeding
in such jurisdictions. Each party waives its right to a trial by jury. Each
party to this Agreement irrevocably consents to the service of process in any
such proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to such party at its address set forth herein. Nothing
herein shall affect the right of any party to serve process in any other manner
permitted by law.

         11.      Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, express overnight
courier, registered first class mail, or telecopier (provided that any notice
sent by telecopier shall be confirmed by other means pursuant to this Section
11), initially to the address set forth below, and thereafter at such other
address, notice of which is given in accordance with the provisions of this
Section.

                  (a)      if to the Company:

                           FreeHand Systems International, Inc.
                           95 First Street, Suite 200
                           Los Altos, California 94022
                           Attention: Kim Lorz, President and CEO
                           Tel. No.: (650) 941-0742 Fax No.: (650) 941-0207

                                       7
<PAGE>

                           with a copy to:

                           Baker & McKenzie LLP
                           1114 Avenue of the Americas
                           New York, New York  10036
                           Attention: Martin Eric Weisberg, Esq.
                           Tel. No: (212) 891-3786
                           Fax No.: (212) 310-1786

                  (b)      if to the Holder:

                           Vision Opportunity Master Fund, Ltd.
                           20 W 55th St., 5th floor
                           New York, NY 10019
                           Tel. No.: (212) 849-8226
                           Fax No.: (212) 867-1416
                           Attention:  Antti Uusiheimala

                           with a copy to:
                           Kramer Levin Naftalis & Frankel LLP
                           1177 Avenue of the Americas
                           New York, New York 10036
                           Attention: Christopher S. Auguste
                           Tel No.: (212) 715-9100
                           Fax No.: (212) 715-8000

         All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; when receipt is
acknowledged, if telecopied; or when actually received or refused if sent by
other means.

         12.      Entire Agreement. This Agreement constitutes the entire
understanding and agreement of the parties with respect to the subject matter
hereof and supersedes all prior and/or contemporaneous oral or written proposals
or agreements relating thereto all of which are merged herein. This Agreement
may not be amended or any provision hereof waived in whole or in part, except by
a written amendment signed by both of the parties.

         13.      Counterparts. This Agreement may be executed by facsimile
signature and in counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       8
<PAGE>

         IN WITNESS WHEREOF, this Agreement was duly executed on the date first
written above.

                                       FREEHAND SYSTEMS INTERNATIONAL, INC.

                                       By: /s/ Kim Lorz
                                           -------------------------------------
                                           Name:  Kim Lorz
                                           Title: President and CEO

                                       VISION OPPORTUNITY MASTER FUND, LTD.

                                       By: /s/ Adam Benowitz
                                           -------------------------------------
                                           Name:  Adam Benowitz
                                           Title: Portfolio Mgr

<PAGE>

                                    EXHIBIT A
                                    ---------

                          FORM OF 2007 SERIES J WARRANT

                                       10
<PAGE>

                                    EXHIBIT B
                                    ---------

                          FORM OF 2007 SERIES G WARRANT

                                       11
<PAGE>

                                    EXHIBIT C
                                    ---------

                          FORM OF 2007 SERIES H WARRANT

                                       12
<PAGE>

                                    EXHIBIT D
                                    ---------

                       FORM OF CERTIFICATE OF DESIGNATION

                                       13
<PAGE>

                                    EXHIBIT E
                                    ---------

                                 FORM OF OPINION

         1.       The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware and has
the requisite corporate power to own, lease and operate its properties and
assets, and to carry on its business as presently conducted.

         2.       The Company has the requisite corporate power and authority to
enter into and perform its obligations under the Exchange Agreement and to issue
the Series C Preferred Stock and the 2007 Warrants and the Common Stock issuable
upon conversion of the Series C Preferred Stock and exercise of the 2007
Warrants. The execution, delivery and performance of each of the transaction
documents contemplated by the Exchange Agreement by the Company and the
consummation by it of the transactions contemplated thereby have been duly and
validly authorized by all necessary corporate action and no further consent or
authorization of the Company or its Board of Directors or stockholders is
required.

         3.       The Series C Preferred Stock and the 2007 Warrants have been
duly authorized and, when delivered against payment in full as provided in the
Exchange Agreement, the Series J Warrant and the 2007 Warrants, as applicable,
will be validly issued, fully paid and nonassessable. The shares of Common Stock
issuable upon conversion of the Series C Preferred Stock and exercise of the
Warrants, have been duly authorized and reserved for issuance, and, when
delivered upon conversion or against payment in full as provided in the
Certificate of Designation and the Warrants, as applicable, will be validly
issued, fully paid and nonassessable.

         4.       The offer, issuance and sale of the Series C Preferred Stock
and the 2007 Warrants and the offer, issuance and sale of the shares of Common
Stock issuable upon conversion of the Series C Preferred Stock and exercise of
the Warrants pursuant to the Exchange Agreement, the Certificate of Designation
and the 2007 Warrants, as applicable, are exempt from the registration
requirements of the Securities Act.

                                       14Exhibit 10.21

                               EXCHANGE AGREEMENT
                               ------------------

         Exchange Agreement (this "Agreement") dated as of __________, 2007
(this "Agreement"), by and between FreeHand Systems International, Inc., a
Delaware corporation (the "Company"), and each of the persons whose signatures
appear on the signature pages attached hereto (each a "Stockholder" and
collectively the "Stockholders").

                                    Recitals
                                    --------

         WHEREAS, pursuant to a series of separate transactions occurring during
2003, 2004 and 2005 between the one or more Stockholders and FreeHand Systems,
Inc., a Nevada corporation ("FHS"), FHS agreed to issue shares of its Series B
Preferred Stock, par value $0.001 per share ("FHS Series B Preferred") to
certain of the Stockholders;

         WHEREAS, pursuant to that certain Exchange Agreement, dated September
14, 2005, by and between U.S. Environmental, Inc., a Delaware corporation
("USEV"), and FHS (the "Exchange Agreement"), USEV acquired 100% of the issued
and outstanding securities of FHS in exchange for the issuance of certain shares
of USEV to all of the stockholders of FHS, FHS became a wholly-owned subsidiary
of the Company and USEV subsequently changed its name to "Freehand Systems
International, Inc.";

         WHEREAS, subsequent to the consummation of the transactions under the
Exchange Agreement, FHS acquired all of the outstanding shares of Sheet Music
Now A/S, a Danish corporation ("SMN"), from the shareholders of SMN (the "SMN
Acquisition") in exchange for the issuance of additional shares of FHS Series B
Preferred to the former SMN shareholders;

         WHEREAS, in connection with the transactions contemplated by the
Exchange Agreement, holders of the FHS Series B Preferred (including the former
SMN shareholders) were to receive shares of the Series B Preferred Stock, par
value $0.001 per share of the Company (the "Series B Stock"), having voting
power, designations, preferences, limitations, restrictions and relative rights
(including conversion rights) substantially identical to those of the FHS Series
B Preferred;

         WHEREAS, pursuant to the terms of the FHS Series B Preferred and the
Series B Stock agreed upon by the Company and the Stockholders, each share of
the Company's Series B Stock was to be convertible into one share of the common
stock of the Company, par value $0.001 per share (the "Common Stock") and each
Stockholder has advised the Company of such Stockholder's willingness to convert
all Series B Stock which the Company agreed to issue to such Stockholder into
Common Stock; and

         WHEREAS, due to inadvertent ministerial errors by FHS and the Company,
neither FHS nor the Company took all the required steps to authorize the
issuance of the FHS Series B Preferred under Nevada law (in the case of FHS) or
the Series B Stock under Delaware law (in the case of the Company) and, in light
of the expressed willingness of the Stockholders to convert the Series B Stock
issuable to them into Common Stock, the Company now desires to exchange one

<PAGE>

share of the Common Stock for each share of Series B Stock issuable by the
Company to each Stockholder as set forth in Schedule I attached hereto, and each
Stockholder is willing to exchange its rights to the issuance of FHS Series B
Preferred and/or Series B Stock (collectively, "Preferred Stock Rights") for
such Common Stock.

         NOW, THEREFORE, for good and valuable consideration, the receipt and
legal sufficiency of which are hereby agreed and acknowledged, the parties
hereto hereby agree as follows:

                                    Agreement
                                    ---------

         1.       Securities Exchange.
                  -------------------

                  (a)      Upon the following terms and subject to the
conditions contained herein, the Company agrees to issue and deliver to
Stockholder the number of shares of Common Stock set forth beside such
Stockholder's name on Schedule I hereto. By the execution and delivery of this
Agreement, each Stockholder agrees to the irrevocable and unconditional
termination and cancellation of such Preferred Stock rights and to surrender
such Stockholder's certificates or other evidence of its Preferred Stock Rights
and to receive such Common Stock in exchange therefore and in full and complete
settlement and satisfaction of such Preferred Stock Rights.

                  (b)      This Agreement shall be effective as between the
Company and any Stockholder, and the closing of the exchange contemplated by
this Agreement shall occur with respect to such Stockholder, upon execution of
this Agreement by the Company and such Stockholder. As soon as practicable
following effectiveness of this Agreement as to any

                  (c)      This Agreement and the rights and obligations
hereunder may not be assigned by any party hereto without the prior written
consent of the other parties hereby. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
(whether by merger, consolidation, recapitalization sale of substantially of all
of the assets of such party or other similar transaction) and permitted assigns.
Nothing herein is intended or shall be construed to confer upon or give to any
person, any rights, privileges or remedies under or by reason of this Agreement,
Stockholder, the Company shall issue or cause the issuance to such Stockholder
of one or more certificates representing, in the aggregate, the number of shares
of Common Stock set forth beside the Stockholder's name on Schedule I and shall
mail such certificate or certificates to the address of such Stockholder set
forth next to such Stockholder's signature herein. Closing hereunder shall be
deemed to occur with respect to any Stockholder upon the Company's mailing of
the certificate or certificate(s) issued to such Stockholder as required by this
Section 1(b).

                  (d)      The shares of Common Stock to be exchanged for
Preferred Stock Rights pursuant to this Agreement are sometimes collectively
referred to herein as the "Securities".

         2.       Previously Issued Certificates. As promptly as practicable
following the execution and delivery of this Agreement by a Stockholder, such
Stockholder will deliver to the Company any certificates in such Stockholder's
possession purporting to represent shares of FHS Series B Preferred or shares of
Series B Stock. Notwithstanding the preceding sentence, (i) the Company agrees

                                       2
<PAGE>

that a Stockholder's failure to deliver any such certificates shall not affect
the Company's obligations to issue Common Stock to such Stockholder hereunder
and (ii) retention of any such certificates by a Stockholder shall not limit or
otherwise affect the obligations of such Stockholder under this Agreement or the
cancellation of such Stockholder's Preferred Stock Rights. By executing and
delivering this Agreement, each Stockholder authorizes the Company to mark the
applicable stock transfer or other records of the Company maintained with
respect to such Stockholder's Preferred Stock Rights "cancelled."

         3.       Representations, Warranties and Covenants of the Stockholder.
Each Stockholder hereby severally makes the following representations and
warranties to the Company, and covenants for the benefit of the Company:

                  (a)      The Stockholder has all the requisite power,
authority and capacity to execute and deliver this Agreement and to perform
Stockholder's obligations under this Agreement. The execution, delivery and
performance of this Agreement has been duly authorized by all necessary action
on the part of the Stockholder. This Agreement has been duly executed and
delivered by the Stockholder and constitutes the legal, valid and binding
obligation of the Stockholder, enforceable against the Stockholder in accordance
with its terms.

                  (b)      The Stockholder is the legal and beneficial owner of
the Preferred Stock Rights and has the right to exchange Preferred Stock Rights
for the Securities free an clear of any liens, security interests or other
encumbrances of any nature whatsoever, and the Preferred Stock Rights may be
exchanged by the Stockholder without obtaining the consent or approval of any
other person or entity. The Stockholder has not sold, transferred, assigned,
pledged, granted a security interest in or otherwise disposed of the Preferred
Stock Rights or any interest therein or granted any option, warrant, put, call,
proxy or power of attorney with respect to such Preferred Stock Rights.

                  (c)      The Stockholder understands that the Securities are
being issued to it in the exchange herein provided for in reliance on specific
provisions of Federal and state securities laws and that the Company is relying
upon the truth and accuracy of the representations, warranties, agreements,
acknowledgments and understandings of the Stockholder set forth herein for
purposes of qualifying for exemptions from registration under the Securities Act
of 1933, as amended (the "Securities Act"), and applicable state securities
laws.

                  (d)      The Stockholder is an "accredited investor" (as
defined in Rule 501 of Regulation D promulgated under the Securities Act), and
the Stockholder has such experience in business and financial matters that it is
capable of evaluating the merits and risks of an investment in the Securities.
The Stockholder acknowledges that an investment in the Securities is speculative
and involves a high degree of risk. The Stockholder acknowledges that it (i) has
such knowledge and experience in financial and business matters such that
Stockholder is capable of evaluating the merits and risks of Stockholder's
investment in the Company, (ii) is able to bear the financial risks associated
with an investment in the Securities and (iii) by virtue of such Stockholder's
Preferred Stock Rights has been the owner of securities issued by the Company.

                                       3
<PAGE>

                  (e)      The Stockholder is acquiring the Securities solely
for its own account and not with a view to or for sale in connection with the
distribution thereof. The Stockholder does not have a present intention to sell
any of the Securities, nor a present arrangement (whether or not legally
binding) or intention to effect any distribution of any of the Securities to or
through any person or entity; provided, however, that by making the
representations herein, the Stockholder does not agree to hold the Securities
for any minimum or other specific term and reserves the right to dispose of the
Securities at any time in accordance with Federal and state securities laws
applicable to such disposition.

                  (f)      The Stockholder understands that the Securities being
issued to the Stockholder in exchange for the Preferred Stock Rights hereunder
have not been, and may never be, registered under the Securities Act and that
none of the Securities can be sold or transferred unless they are first
registered under the Securities Act and such state and other securities laws as
may be applicable or the Company receives an opinion of counsel reasonably
acceptable to the Company that an exemption from registration under the
Securities Act is available (and then the Securities may be sold or transferred
only in compliance with such exemption and all applicable state and other
securities laws). The Stockholder acknowledges that such person is familiar with
Rule 144 of the rules and regulations of the Securities and Exchange Commission,
as amended, promulgated pursuant to the Securities Act ("Rule 144"), and that
the Stockholder has been advised that Rule 144 permits resales only under
certain circumstances. The Stockholder understands that to the extent that Rule
144 is not available, the Stockholder will be unable to sell any Securities
without either registration under the Securities Act or the existence of another
exemption from such registration requirement.

         4.       Representations, Warranties and Covenants of the Company. The
Company represents and warrants to the Stockholder, and covenants for the
benefit of the Stockholder, as follows:

                  (a)      The Company has been duly incorporated and is validly
existing and in good standing under the laws of the state of Delaware, with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as currently conducted, and is duly registered and
qualified to conduct its business.

                  (b)      The Securities have been duly authorized by all
necessary corporate action and, when paid for or issued in accordance with the
terms hereof, the Securities shall be validly issued and outstanding, fully paid
and nonassessable, free and clear of all liens, encumbrances and rights of
refusal of any kind.

                  (c)      This Agreement has been duly authorized, validly
executed and delivered on behalf of the Company and is a valid and binding
agreement and obligation of the Company enforceable against the Company in
accordance with its terms, subject to limitations on enforcement by general
principles of equity and by bankruptcy or other laws affecting the enforcement
of creditors' rights generally, and the Company has full power and authority to
execute and deliver this Agreement and the other agreements and documents
contemplated hereby and to perform its obligations hereunder and thereunder.

                                       4
<PAGE>

         5.       Notices. All notices, demands, consents, requests,
instructions and other communications to be given or delivered or permitted
under or by reason of the provisions of this Agreement or in connection with the
transactions contemplated hereby shall be in writing and shall be deemed to be
delivered and received by the intended recipient as follows: (a) if personally
delivered, on the business day of such delivery (as evidenced by the receipt of
the personal delivery service), (b) if mailed certified or registered mail
return receipt requested (with all costs prepaid), four (4) business days after
being mailed, or (c) if delivered by a recognized overnight courier service of
recognized standing (with all charges having been prepaid), on the business day
of such delivery (as evidenced by the receipt of the overnight courier service).
If any notice, demand, consent, request, instruction or other communication
cannot be delivered because of a changed address of which no notice was given
(in accordance with this Section 5), or the refusal to accept same, the notice,
demand, consent, request, instruction or other communication shall be deemed
received on the second business day the notice is sent (as evidenced by a sworn
affidavit of the sender). All such notices, demands, consents, requests,
instructions and other communications will be sent to the following addresses as
applicable:

                  If to the Company:

                  FreeHand Systems International, Inc.
                  95 First Street
                  Suite 2000
                  Los Altos CA 94033
                  Attn:    Mr. Kim A. Lorz
                           Chief Executive Officer

                  with a copy to:

                  Baker & McKenzie, LLP
                  1114 Avenue of the Americas
                  New York, NY  10036
                  Attention:  Martin Eric Weisberg, Esq.

                  If to a Stockholder:

                  At the address set forth on the signature page signed by such
Stockholder.

or to such other address as any party may specify by notice given to the other
party in accordance with this Section 5.

         6.       Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed in that State, without regard to any of its
principles of conflicts of laws or other laws which would result in the
application of the laws of another jurisdiction.

         7.       Entire Agreement. This Agreement contains the entire
understanding and agreement of the parties relating to the subject matter hereof
and it supersedes all prior and/or contemporaneous understandings and agreements
of any kind and nature (whether written or oral) between the Company and the

                                       5
<PAGE>

Stockholders, or any of them, with respect to such subject matter, all of which
are merged herein. This Agreement may not be amended or any provision hereof
waived in whole or in part, except by a written amendment signed by all of the
parties.

         8.       Binding Effect; Assignment. This Agreement and the rights and
obligations hereunder may not be assigned by any party hereto without the prior
written consent of the other parties hereby. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors (whether by merger, consolidation, recapitalization sale of
substantially of all of the assets of such party or other similar transaction)
and permitted assigns. Nothing herein is intended or shall be construed to
confer upon or give to any person, any rights, privileges or remedies under or
by reason of this Agreement.

         9.       Counterparts. This Agreement may be executed in two (2) or
more counterparts, and by the different parties hereto in separate counterparts,
each of which, when executed, shall be deemed to be an original, and all of
which, when taken together, shall constitute one and the same document. This
Agreement may be executed by facsimile signature which shall constitute a legal
and valid signature for purposes hereof.

                            [SIGNATURE PAGE FOLLOWS]

                                       6
<PAGE>

         IN WITNESS WHEREOF, this Agreement was duly executed on the date first
written above.

                                       FREEHAND SYSTEMS INTERNATIONAL, INC.

                                       By:____________________________________
                                          Name:
                                          Title:

                                       7
<PAGE>

Agreed and accepted this ___ day of
_____ 2007.

[Stockholder]

By: ________________________________
    Name:
    Title:

Address for delivery of Common
Stock Certificates and Notices

____________________________________

____________________________________

____________________________________

<PAGE>

                                   Schedule I
                                   ----------

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   Name of Stockholder          Series B Stock                 Securities
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