Document:

EXHIBIT 10.1

                         EXECUTIVE EMPLOYMENT AGREEMENT

      THIS EXECUTIVE EMPLOYMENT AGREEMENT (this "Agreement") is made and entered
into as of this 4th day of August,  2006 by and  between  ISECURETRAC  CORP.,  a
Delaware  corporation  having its principal  offices at 5078 South 111th Street,
Omaha, NE 68137 (hereinafter  referred to as the "Company") and PETER A. MICHEL,
an individual residing in Alexandria,  Virginia  (hereinafter referred to as the
"Executive").

                                   WITNESSETH:

      WHEREAS, the Executive has demonstrated unique qualifications to act in an
executive  capacity for the Company,  and the Company  expects that  Executive's
contribution will be substantial and meritorious; and

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

      1.  Employment.  The  Company  agrees to  employ  the  Executive,  and the
Executive agrees to accept such employment,  all in accordance with the terms of
this Agreement.

      2. Capacity and Duties. (a) The Executive shall serve as the President and
Chief  Executive  Officer of the Company and shall be appointed as a Director of
the Company.  The Executive  shall perform the duties of the President and Chief
Executive  Officer  of the  Company  as set forth in its  Bylaws  and such other
duties  as are  reasonably  assigned  to him by the  Board of  Directors  of the
Company (the  "Board").  The Executive will carry out such duties to the best of
his ability in a diligent,  trustworthy,  businesslike  and efficient manner for
the purposes of advancing the business of the Company. Executive will devote not
less than an average  of 50 hours per week to the  business  and  affairs of the
Company. It is acknowledged that Employee currently serves as a director of or a
consultant to the other  organizations  identified in Schedule A hereto,  and he
may devote a reasonable  amount of time to these  organizations,  and such other
organizations as approved by the Board, provided that it does not interfere with
his  obligations  to the Company.  Through  January 31, 2007,  Executive will be
expected  to spend  not  less  than 75% of his  business  time at the  Company's
headquarters  in Omaha,  Nebraska  except  for time  spent out of the  office as
necessitated by (i) potential  acquisitions or similar corporate transactions or
(ii) the existing Dallas, Texas truancy project.  Thereafter,  Executive will be
expected  to spend  not  less  than 50% of his  business  time at the  Company's
headquarters in Omaha, Nebraska.

      (b) Executive shall comply with the Company's rules and regulations as may
be set forth in the Company's Employee Handbook, or similar document.  Executive
also agrees that he shall not in his  personal  capacity  take  advantage of any
business  opportunities  that arise during his  employment  that may benefit the
Company and relate to the Company's ongoing  business.  Executive further agrees
that all reasonable facts regarding such  opportunities must be forwarded to the
Board for consideration and approval.  In the event Executive  observes unlawful
acts or practices by the Company,  he shall promptly  notify the Chairman of the
Board of Directors.  If the Executive is elected as a director of the Company or
as a director of any of the Company's affiliates or subsidiaries,  the Executive
will fulfill his duties as such director  without any  additional  compensation.
With respect to the issuance and sale of any  securities  issued by the Company,
Executive  shall restrict his  participation  in such sales to those  activities
permitted by Rule  3a-4-l(a)(4)(ii)  or (iii) of the Securities and Exchange Act
of 1934 and Rule 144 promulgated under the Securities Act of 1933.

<PAGE>

      3. Term. The term of  Executive's  employment  hereunder (the  "Employment
Period") shall commence on the date hereof ("Effective Date") and continue on an
indefinite basis, unless earlier terminated hereunder.

      4. Compensation.

            (a) Salary.  For all services  rendered by the Executive  under this
      Agreement,  the Company  shall pay the  Executive an annual  salary of Two
      Hundred Twenty-Five Thousand Dollars ($225,000) ("Salary").

            (b)  Bonuses.  Executive  and the Board  shall  agree,  on an annual
      basis,  to a bonus plan under  which  Executive  may earn a bonus of up to
      fifty  percent  (50%)  of his  Salary.  Such  plan  shall be tied to goals
      mutually established by the Board and the Executive.  For the remainder of
      fiscal year 2006,  Executive  shall receive a bonus equal to $46,875 if he
      remains an employee of the Company through December 31, 2006.

            (c) Expenses.  To the extent not otherwise  paid for by the Company,
      the Company will  reimburse  the Executive  for  reasonable  and necessary
      expenses incurred in promoting the Company's business,  including expenses
      for travel and  entertainment,  including  the cost of commuting to Omaha,
      Nebraska,  such reimbursement to be made periodically upon presentation of
      appropriate receipts or other substantiation.

            (d) Omaha Housing and Automobile. The Company will provide Executive
      with a furnished apartment in the Omaha,  Nebraska metropolitan area and a
      leased  automobile for his use while he is in Omaha. The aggregate cost of
      such apartment and automobile will not exceed $2,500 per month and will be
      subject to withholding and W-2 reporting.

            (e)  Consulting  Agreement.  The  Company  pay  all  amounts  due to
      Executive  (or an  entity  controlled  by him)  pursuant  to the May  2006
      Consulting Agreement between the Company and the Executive.

            (f)  Employee  Benefit  Plans.  The  Executive  will be permitted to
      participate  in such  pension,  profit  sharing,  bonus,  life  insurance,
      hospitalization,  major medical, vacation and other employee benefit plans
      of the Company that may be in effect from time to time, to the extent that
      the  Executive is eligible  under the terms of those plans.  Unless stated
      otherwise in this  Agreement,  Executive's  benefits  under any such plans
      shall be the same as those extended to other  employees of the Company and
      as may be published by the Company from time to time.

                                       2
<PAGE>

            (g) Taxes, Etc. All compensation  payable to Executive  hereunder is
      stated in gross amount and shall be subject to all applicable  withholding
      taxes and other normal payroll  deductions and any other amounts  required
      by law to be withheld.

            (h) Vacation.  Executive shall be entitled to five (5) weeks of paid
      vacation or time off ("PTO") per fiscal year of the Company, in accordance
      with the  Company's  PTO  policies,  practices,  and  procedures in effect
      during the Term. Such PTO shall,  however,  be prorated in any fiscal year
      during which  Executive is employed under this Agreement for less than the
      entire fiscal year,  in accordance  with the number of days in that fiscal
      year during which Executive is so employed. Up to five weeks of PTO may be
      carried  over to any  subsequent  fiscal  year if the  Executive  does not
      utilize his entire PTO during a previous fiscal year.

      5. Stock Incentives.

            (a) By no later than  September  15,  2006,  the  Executive  will be
      granted stock options (the "Options")  under the terms of the Company 2006
      Omnibus  Equity  Incentive  Plan (the  "Plan") for the purchase of 430,856
      shares of the Company's common stock.

            (b) The Options will have an exercise price equal to the fair market
      value of the  Company's  common stock on the grant date as  determined  in
      accordance  with the Plan.  The Options may be incentive  stock options or
      nonqualified  stock  options for  purposes of Section 422 of the  Internal
      Revenue Code of 1986, as determined by the Compensation Committee.

            (c) The Options will vest and become exercisable with respect to one
      thirty-sixth  (1/36th) of the total number of shares subject  thereto when
      the Executive completes one month of continuous service from the Effective
      Date and with respect to an additional  one  thirty-sixth  (1/36th) of the
      total number of shares  subject  thereto  when  Executive  completes  each
      additional  month of continuous  service  thereafter until all the Options
      shall have fully vested or until  termination of employee's  service.  The
      Options shall fully vest and become 100% exercisable upon (i) a "Change in
      Control'  (as  defined  in the Plan as it exists on the date  hereof,  but
      which shall  specifically  include any transaction that results in Sponsor
      Investments LLC, or an affiliate  thereof,  no longer having the authority
      to appoint a  majority  of the  directors  of the  Company),  or (ii) upon
      termination  of  Executive's  employment  by the Company for reasons other
      than for  "Cause"  (as  defined  below).  The  Options are subject to such
      reasonable  additional terms and conditions that are not inconsistent with
      this Agreement and the Plan.

            (d) The Company shall,  within a reasonable period of time, register
      the  issuance  of shares of the  Company's  common  stock  underlying  the
      Options  granted to the  Executive  pursuant  to this  Section 5. The term
      "registered"   for  the   purposes  of  this  Section  5(d)  refers  to  a
      registration effected by preparing and filing a registration  statement on
      Form S-8 in compliance  with the Securities  Act of 1933, as amended,  and
      the  declaration  or  ordering  of  effectiveness  of  such   registration
      statement.

                                       3
<PAGE>

            (e)  Notwithstanding any provision to the contrary contained herein,
      Executive acknowledges and agrees that by signing this Agreement he agrees
      not to sell any of the Company's common stock (whether  acquired  pursuant
      to this agreement or otherwise) at a time when  applicable  laws,  Company
      policies or an agreement between the Company and its underwriters prohibit
      such sale. Executive further acknowledges and agrees that this restriction
      will apply to any position that he may now, or in the future hold with the
      Company, whether as an employee,  consultant or director of the Company or
      any  subsidiary of the Company.  Company  policies  restricting  such sale
      shall no longer apply upon termination of Executive's  employment with the
      Company.

      6.  Termination by Company.  The Company shall have the right to terminate
Executive's  employment hereunder at any time for any reason or for no reason at
all upon thirty (30) days written notice to Executive.

      7.  Termination  By  Executive.  Executive  has the right to terminate his
employment  under this  Agreement  for any reason or without  reason upon thirty
(30) days prior written notice to the Company.

      8. Effect of Resignation.  Upon the termination of Executive's  employment
with the Company for any reason, Executive shall be deemed to have automatically
resigned  from any position he may hold with the Company,  including any offices
or board  memberships  with the Company and/or its  affiliates or  subsidiaries.
Such resignation shall be deemed effective  immediately  without the requirement
that a written  resignation  be  delivered.  The  Executive  shall  execute  any
agreements to further effectuate such resignations that are reasonably requested
by the Company.

      9. Compensation After Termination.

      (a) In the event the Company  terminates the  Executive's  employment with
the Company for any reason  other than  "Cause"  (as defined  below),  Executive
shall be entitled to a severance  payment in an amount  equal to one year of his
Salary in additional to any portion of his Salary that has been earned,  but not
yet paid to him, and all unused PTO time, through the date of termination.  Such
severance  payment will be paid in a single lump sum not more than 30 days after
the date of termination.  In addition,  Executive shall retain all stock options
which have vested as of the  effective  date of the  termination;  provided that
such options will expire no earlier  than one year after the  effective  date of
the  termination.   Notwithstanding  the  foregoing,  the  exercise  period  for
Executive's  vested  stock  options will be extended for one month for each full
month after one year from the  Effective  Date the  Executive is employed by the
Company  prior to  termination  as long as the number of GPS  tracking  units in
activated  service as of the date of  termination  equals or exceeds  the target
number of units set  forth in  Schedule  B hereto  for the  month  during  which
termination  occurs.  However,  in no event shall the  exercise  period for such
vested  stock  options  be  extended  for  more  than  three  years  beyond  the
termination  date. For purposes hereof, a unit shall be considered "in activated
service" if it is  installed on an offender  being  tracked by a customer of the
Company.

      (b) In the event the Company  terminates  the  Executive's  employment for
Cause, or Executive  voluntarily  terminates his employment,  Executive shall be
entitled to only that  portion of his Salary that has been  earned,  but not yet
paid to him, and all unused PTO time,  through the date of  termination  and all
options,  whether or not vested, shall immediately terminate as of the effective
date of termination of employment.

                                       4
<PAGE>

      (c) In this Agreement, "Cause" means any of the following: (i) engaging in
(A) willful or gross misconduct or (B) willful or gross neglect, (ii) repeatedly
failing to adhere to the  directions  of the Board or the written  policies  and
practices of the Company,  (iii) the  commission of a felony or a crime of moral
turpitude,  or any crime  involving the Company,  (iv) fraud,  misappropriation,
embezzlement or material or repeated  insubordination,  (v) a material breach by
the Executive of the terms of this Agreement, including the failure of Executive
to devote an average  of 50 hours per week to the  business  and  affairs of the
Company or the failure of Executive  to spend the minimum  amount of time in the
Company's  headquarters  office or traveling on Company business for the reasons
described  in  Section  2(a)  hereof  (the  "Time  Covenant"),   (other  than  a
termination of employment by the Executive), or (vi) any illegal act detrimental
to the Company,  all as determined in the sole  discretion of the Board.  If the
Company  believes that Cause for  termination  exists,  the Company shall notify
Executive  of  that  belief,  and  that  notice  shall  describe  the  event  or
circumstance  believed to  constitute  Cause for  termination.  If that event or
circumstance  may reasonably be remedied or corrected,  Executive  shall have 30
days to effect that  correction or remedy.  If not corrected or remedied  within
that 30 day period,  or if the event or  circumstance is not of a nature that it
may be remedied or corrected,  Cause for termination shall immediately be deemed
to exist,  and Executive's  employment shall be deemed  terminated.  The parties
agree that a breach of the Time Covenant may be cured by the Executive's  future
compliance  therewith  after  the  initial  notice of  breach  thereof  from the
Company,  but that  continued  breach thereof after receipt of such notice shall
not be curable.

      10. Confidential  Information.  The Executive acknowledges that he has had
and will have access to certain information related to the business, operations,
future plan and customers of the Company,  the  disclosure or use of which could
cause the Company substantial losses and damages.  Accordingly,  during the term
of this Agreement and thereafter,  Executive shall keep secret and retain in the
strictest  confidence,  and shall not,  without the prior written consent of the
Board,  furnish,  make available,  or disclose to any third party or use for the
benefit of  himself or for the  benefit  of any third  party,  any  Confidential
Information.  "Confidential  Information" shall mean any information relating to
the  business  or  affairs  of the  Company,  including,  but  not  limited  to,
information relating to financial  statements,  customer  identities,  potential
customers,   employees,   suppliers,  servicing  methods,  equipment,  programs,
strategies and  information,  analyses,  profit margins,  computer  programs and
software  (including object code and source code),  past,  current,  and planned
research and development,  market studies and business plans, all inventions and
ideas  (whether  patentable  or  unpatentable  and  whether  or not  reduced  to
practice),  trademarks and service marks,  corporate logos, or other proprietary
information  used by the Company in  connection  with its  business  operations;
provided,   however,  that  Confidential   Information  shall  not  include  any
information  which is in the  public  domain or  becomes  known in the  industry
through no wrongful act on part of the Executive.  Executive  acknowledges  that
the Confidential  Information is vital, sensitive,  confidential and proprietary
to the Company.

      11.  Inventions.  Each Invention shall belong  exclusively to the Company.
The Executive  acknowledges  that all of the  Inventions are works made for hire
and the property of the Company,  including any  copyrights,  patents,  or other
intellectual  property rights pertaining  thereto.  If it is determined that any
such  works are not works made for hire,  the  Executive  hereby  assigns to the
Company all of the Executives right,  title, and interest,  including all rights
of copyright,  patent,  and other  intellectual  property rights,  to or in such
Inventions.  The term  "Invention"  shall mean any idea,  invention,  technique,
modification,   process,  or  improvement   (whether  patentable  or  not),  any
industrial design (whether registerable or not), any mask work, however fixed or
encoded, that is suitable to be fixed, embedded or programmed in a semiconductor
product (whether  recordable or not), and any work of authorship (whether or not
copyright protection may be obtained for it) created, conceived, or developed by
the  Executive,  either  solely  or  in  conjunction  with  others,  during  the
Employment Period, or a period that includes a portion of the Employment Period,
that  relates in any way to, or is useful in any manner  in, the  business  then
being  conducted or proposed to be  conducted by the Company,  and any such item
created by the Executive, either solely or in conjunction with others, following
termination of the Executive's  employment with the Company,  that is based upon
or uses Confidential  Information  Furthermore,  the Executive covenants that he
will promptly:

                                       5
<PAGE>

      (a) disclose to the Company in writing any Invention;

      (b) assign to the Company or to a party designated by the Company,  at the
Company's request and without  additional  compensation,  all of the Executive's
right to the Invention for the United States and all foreign jurisdictions;

      (c) execute and deliver to the Company such applications, assignments, and
other  documents  as the  Company  may  request in order to apply for and obtain
patents  or other  registrations  with  respect to any  invention  in the United
States and any foreign jurisdictions;

      (d) sign all other papers  necessary  to carry out the above  obligations;
and

      (e) give  testimony  and  render  any other  assistance  in support of the
Company's rights to any Invention.

      12. Return of Company Materials Upon Termination,  Executive  acknowledges
that all price  lists,  manuals,  catalogs,  binders,  customer  lists and other
customer information,  supplier lists, financial information,  and other records
or  documents  containing  Confidential  Information,  prepared by  Executive or
coming into  Executive's  possession by virtue of Executive's  employment by the
Company is and shall  remain the  property of the Company  upon  termination  of
Executive's  employment  hereunder,  Executive shall immediately return all such
items in his possession to the Company, together with all copies thereof.

      13. Right to Injunctive Relief. The Executive agrees and acknowledges that
a violation of the covenants  contained in Sections 8, 10, 11, 12 and 15 of this
Agreement will cause irreparable damage to the Company,  and that it is and will
be  impossible  to estimate or determine the damage that will be suffered by the
Company  in the  event  of a  breach  by the  Executive  of any  such  covenant.
Therefore,  the Executive  further  agrees that in the event of any violation or
threatened  violation  of such  covenants,  the  Company  shall be entitled as a
matter of course to an  injunction  out of any court of  competent  jurisdiction
restraining such violation or threatened violation by the Executive,  such right
to an injunction to be cumulative and in addition to whatever other remedies the
Company may have.

                                       6
<PAGE>

      14.  Representation by the Executive.  The Executive hereby represents and
warrants that the execution of this Agreement and the  performance of his duties
and  obligations  hereunder  will not  breach or be in  conflict  with any other
agreement to which he is a party or by which be is bound, and that he is not now
subject to any covenant  against  competition  or similar  covenant  which would
affect the performance of his duties hereunder.

      15.  Covenant  of  Non-Competition.  Executive  agrees  that he shall not,
during the Employment Period and for a period of twelve (12) months  thereafter,
engage in any business or activities,  whether directly or indirectly,  which is
competitive with the Company.

      16. Indemnification. The Company shall indemnify Executive against any and
all expenses  (including  reasonable  attorney's  fees) incurred by Executive by
reason  of the fact  that  Executive  is or was a  director  or  officer  of the
Company,  acting within the scope of his employment  with the Company and as the
result of any action,  suit or proceeding to which Executive is, has been, or is
threatened  to be made a party,  to the fullest  extend  permitted by law and as
more  fully  described  in the  bylaws of the  Company.  To  assure  Executive's
indemnification hereunder, the Company shall maintain, at all times, a Directors
and Officers  Insurance  policy,  sufficient  to meet the  Company's  obligation
hereunder in an amount not less than  $1,000,000 or such higher amount as may be
deemed prudent from time to time.

      17. Assignment.  This Agreement is personal and shall in no way be subject
to  assignment  by the  Executive or the Company  without the  permission of the
other provided,  however, that the Company shall have the right to assign all or
any part of its rights or obligations  under this Agreement to (i) any affiliate
or subsidiary of the Company,  or (ii) the purchaser of all or substantially all
of the assets of the Company.

      18. Enforceability. If any portion or provision of this Agreement shall to
any extent be declared  illegal or  unenforceable  by a duly authorized court of
competent jurisdiction, then the remainder of this Agreement, or the application
of such portion or provision in circumstances other than those as to which it is
so declared illegal or unenforceable,  shall not be affected  thereby,  and each
portion and provision of this  Agreement  shall be valid and  enforceable to the
fullest extent permitted by law.

      19. Notices.  All notices and  communications  required or permitted to be
given  hereunder shall be given by delivering the same in hand or by mailing the
same by certified or registered mail, return receipt requested, postage prepaid,
as follows:

      If sent to the Company, to:           iSecureTrac Corp.
                                            Attn: Chairman of the Board
                                            5078 South 111th Street
                                            Omaha, Nebraska 68137
                                            Facsimile No.: (402) 537-9847

                                       7
<PAGE>

      If to the Executive:                  Peter A. Michel
                                            1109 Gatewood Drive
                                            Alexandria, VA  22307

or such other address as either party shall have  furnished to the other by lice
notice. Notices shall be effective as of the date of such delivery or mailing.

      20. Entire Agreement.  This Agreement constitutes the entire agreement and
understanding  between the parties in relation to the subject  matter hereof and
there are no promises, representations,  conditions, provisions or terms related
thereto other than those set forth in this Agreement.  This Agreement supersedes
all previous understandings,  agreements and representations between the Company
and the Executive regarding the Executive's  employment by the Company,  written
or oral.

      21. Governing Law. This Agreement shall be construed under and be governed
in all respects by the internal laws,  and not the laws  pertaining to choice or
conflicts of law, of the State of Delaware.

      22.  Waiver;  Amendment.  No  waiver in any  instance  by any party of any
provision  of this  Agreement  shall be  deemed a waiver  by such  party of such
provision in any other instance or a waiver of any other provision  hereunder in
any instance.  This Agreement cannot be modified except by written  amendment to
this  Agreement  duly  executed  by  both  parties.   Any  oral   agreements  or
understandings between Executive and the Company intended to modify the terms of
this Agreement shall be null and void.

      23. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original, but all of which taken together shall
constitute one in the same Agreement.

      24. Headings.  Interpretation.  The descriptive headings in this Agreement
are inserted for  convenience  of reference only and are not intended to be part
of or affect the meaning or  interpretation  of this  Agreement.  The use of the
word  "including"  in this  Agreement  shall be by way of example rather than by
limitation.

      25.  Survival.  Sections 8, 9, 10, 11, 12, 13, 14 and 15 shall survive and
continue in full force and effect in accordance  with their terms and conditions
notwithstanding any termination of the Executive's employment hereunder.

                                       8
<PAGE>

      IN WITNESS  WHEREOF,  Company has caused its duly  authorized  officers to
execute this Agreement,  and Executive has executed this Agreement as of the day
and year first above written.

                                        ISECURETRAC CORP.

                                        /s/ Roger Kanne
                                        -------------------
                                        Roger Kanne,
                                        On behalf of the Board

                                        EXECUTIVE

                                        /s/ Peter A. Michel
                                        -------------------
                                        Peter A. Michel

                                       9Exhibit 10.21

                           EQUITY INVESTMENT AGREEMENT

      THIS EQUITY INVESTMENT  AGREEMENT is dated as of the 2nd day of May, 2006,
(the  "Agreement") by and between  IMPERIAL  CAPITAL  HOLDINGS,  LLC., a limited
liability company (the "Investor"),  and GENETHERA,  INC., a Florida corporation
(the "Company").

      WHEREAS,  the  parties  desire  that,  upon the terms and  subject  to the
conditions  contained herein,  the Company shall issue and sell to the Investor,
from time to time as provided  herein,  and the Investor shall purchase from the
Company up to Five Million U.S.  Dollars  ($5,000,000)  of the Company's  common
stock, par value $0.001 per share (the "Common Stock"); and

      WHEREAS,  such investments will be made in reliance upon the provisions of
Regulation D ("Regulation D") of the Securities Act of 1933, as amended, and the
regulations  promulgated  there under (the  "Securities  Act"), and or upon such
other exemption from the registration  requirements of the Securities Act as may
be available with respect to any or all of the investments to be made hereunder.

      WHEREAS,  the Company has engaged  Brewer  Financial  Services,  LLC.,  an
Illinois  limited  liability  company  (the  "Placement  Agent"),  to act as the
Company's exclusive placement agent in connection with the sale of the Company's
Common Stock to the Investor  pursuant to the Placement Agent  Agreement,  dated
the date hereof, by and among the Company,  the Placement Agent and the Investor
(the "Placement Agent Agreement").

      NOW, THEREFORE, the parties hereto agree as follows:

                                   ARTICLE I.
                               CERTAIN DEFINITIONS

      Section 1.1.  "Advance"  shall mean the portion of the  Commitment  Amount
requested by the Company in the Advance Notice.

      Section  1.2.   "Advance   Date"  shall  mean  the  date  the   securities
broker-dealer  selected  by the  Investor  is in  receipt  of the funds from the
Investor and such  securities  broker-dealer  is in  possession  of free trading
shares from the Company and  therefore an Advance by the Investor to the Company
can be made and the securities broker-dealer can release the free trading shares
to the  Investor.  The Advance  Date shall be the first (1st)  Trading Day after
expiration of the applicable Pricing Period for each Advance.

      Section 1.3.  "Advance Notice" shall mean a written notice to the Investor
setting forth the Advance amount that the Company requests from the Investor and
the Advance Date.

      Section  1.4.  "Advance  Notice  Date"  shall  mean each date the  Company
delivers to the  Investor an Advance  Notice  requiring  the Investor to advance
funds to the Company,  subject to the terms of this Agreement. No Advance Notice
Date shall be less than seven (7) Trading  Days after the prior  Advance  Notice
Date.

      Section 1.5.  "Bid Price" shall mean,  on any date,  the closing bid price
(as reported by Bloomberg  L.P.) of the Common Stock on the Principal  Market or
if the Common Stock is not traded on a Principal  Market,  the highest  reported
bid price for the Common  Stock,  as furnished by the  National  Association  of
Securities Dealers, Inc.

      Section  1.6.  "Closing"  shall mean one of the closings of a purchase and
sale of Common Stock pursuant to Section 2.3.

      Section 1.7.  "Commitment Amount" shall mean the aggregate amount of up to
Five Million U.S. Dollars  ($5,000,000) which the Investor has agreed to provide
to the Company in order to purchase the Company's  Common Stock  pursuant to the
terms and conditions of this Agreement.

      Section 1.8.  "Commitment  Period" shall mean the period commencing on the
earlier to occur of (i) the  Effective  Date,  or (ii) such  earlier date as the
Company and the  Investor  may  mutually  agree in writing,  and expiring on the
earliest to occur of (x) the date on which the Investor  shall have made payment
of Advances  pursuant to this Agreement in the aggregate  amount of Five Million
U.S. Dollars ($5,000,000), (y) the date this Agreement is terminated pursuant to
Section  2.5,  or (z) the date  occurring  twenty-four  (24)  months  after  the
Effective Date.

<PAGE>

      Section 1.9.  "Common  Stock" shall mean the Company's  common stock,  par
value $0.001 per share.

      Section  1.10.  "Condition  Satisfaction  Date" shall have the meaning set
forth in Section 7.2.

      Section 1.11.  "Damages" shall mean any loss,  claim,  damage,  liability,
costs and expenses (including,  without limitation,  reasonable  attorney's fees
and disbursements and costs and expenses of expert witnesses and investigation).

      Section 1.12.  "Effective Date" shall mean the date on which the SEC first
declares  effective  a  Registration  Statement  registering  the  resale of the
Registrable Securities as set forth in Section 7.2(a).

      Section 1.13. "Escrow Agreement" shall mean the escrow agreement among the
Company, the Investor, and David Gonzalez, Esq., dated the date hereof.

      Section 1.14.  "Exchange  Act" shall mean the  Securities  Exchange Act of
1934, as amended, and the rules and regulations promulgated there under.

      Section  1.15.   "Material  Adverse  Effect"  shall  mean  any  condition,
circumstance, or situation that would prohibit or otherwise materially interfere
with the ability of the Company to enter into and perform any of its obligations
under this  Agreement  or the  Registration  Rights  Agreement  in any  material
respect.

      Section  1.16.  "Market  Price"  shall mean the lowest  VWAP of the Common
Stock during the Pricing Period.

      Section 1.17. "Maximum Advance Amount" shall be Two Hundred Fifty Thousand
U.S. Dollars (US $250,000) per Advance Notice.

      Section  1.18.  "NASD" shall mean the National  Association  of Securities
Dealers, Inc.

      Section  1.19.  "Person"  shall  mean  an  individual,  a  corporation,  a
partnership, an association, a trust or other entity or organization,  including
a government or political subdivision or an agency or instrumentality thereof.

      Section  1.20.  "Placement  Agent" shall mean Brewer  Financial  Services,
LLC., a registered broker-dealer, located in the City of Chicago, Illinois.

      Section 1.21. "Pricing Period" shall mean the five (5) consecutive Trading
Days after the Advance Notice Date.

      Section 1.22.  "Principal  Market" shall mean the Nasdaq National  Market,
the Nasdaq SmallCap Market, the American Stock Exchange,  the OTC Bulletin Board
or the New York Stock Exchange,  whichever is at the time the principal  trading
exchange or market for the Common Stock.

      Section 1.23.  "Purchase Price" shall be set at ninety three percent (93%)
of the Market Price during the Pricing Period.

      Section  1.24.  "Registrable  Securities"  shall mean the shares of Common
Stock to be issued hereunder (i) in respect of which the Registration  Statement
has not been  declared  effective by the SEC, (ii) which could not be sold under
circumstances  meeting  all of the  applicable  conditions  of Rule  144 (or any
similar  provision then in force) under the Securities Act ("Rule 144") or (iii)
which have not been otherwise  transferred to a holder who may trade such shares
without  restriction  under the Securities  Act, and the Company has delivered a
new certificate or other evidence of ownership for such securities not bearing a
restrictive legend.

      Section 1.25.  "Registration Rights Agreement" shall mean the Registration
Rights Agreement dated the date hereof, regarding the filing of the Registration
Statement for the resale of the Registrable Securities, entered into between the
Company and the Investor.

<PAGE>

      Section 1.26. "Registration Statement" shall mean a registration statement
on Form  S-1 or  SB-2  (if use of such  form is then  available  to the  Company
pursuant to the rules of the SEC and, if not, on such other form  promulgated by
the SEC for which the Company then  qualifies  and which counsel for the Company
shall deem appropriate,  and which form shall be available for the resale of the
Registrable  Securities  to be  registered  there under in  accordance  with the
provisions  of this  Agreement and the  Registration  Rights  Agreement,  and in
accordance with the intended method of distribution of such securities), for the
registration of the resale by the Investor of the Registrable  Securities  under
the Securities Act.

      Section  1.27.  "Regulation  D" shall  have the  meaning  set forth in the
recitals of this Agreement.

      Section 1.28. "SEC" shall mean the Securities and Exchange Commission.

      Section  1.29.  "Securities  Act" shall have the  meaning set forth in the
recitals of this Agreement.

      Section 1.30.  "SEC  Documents"  shall mean Annual Reports on Form 10-KSB,
Quarterly  Reports  on  Form  10-QSB,  Current  Reports  on Form  8-K and  Proxy
Statements  of the  Company as  supplemented  to the date  hereof,  filed by the
Company for a period of at least twelve (12) months  immediately  preceding  the
date  hereof or the  Advance  Date,  as the case may be,  until such time as the
Company  no  longer  has  an  obligation  to  maintain  the  effectiveness  of a
Registration Statement as set forth in the Registration Rights Agreement.

      Section  1.31.  "Trading Day" shall mean any day during which the New York
Stock Exchange shall be open for business.

                                   ARTICLE II.
                                    ADVANCES

      Section 2.1. Investments

            (a)  Advances.  Upon the  terms  and  conditions  set  forth  herein
(including,  without  limitation,  the provisions of Article VII hereof), on any
Advance  Notice Date the  Company may request an Advance by the  Investor by the
delivery  of an Advance  Notice.  The number of shares of Common  Stock that the
Investor  shall  receive for each Advance  shall be  determined  by dividing the
amount of the Advance by the  Purchase  Price.  No  fractional  shares  shall be
issued.  Fractional  shares  shall be rounded to the next higher whole number of
shares.  The aggregate maximum amount of all Advances that the Investor shall be
obligated to make under this Agreement shall not exceed the Commitment Amount.

      Section 2.2. Mechanics

            (a) Advance Notice.  At any time during the Commitment  Period,  the
Company may deliver an Advance Notice to the Investor, subject to the conditions
set forth in Section  7.2;  provided,  however,  the amount for each  Advance as
designated by the Company in the applicable  Advance  Notice,  shall not be more
than the Maximum Advance Amount.  The aggregate amount of the Advances  pursuant
to  this  Agreement  shall  not  exceed  the  Commitment   Amount.  The  Company
acknowledges  that the  Investor may sell shares of the  Company's  Common Stock
corresponding  with a particular Advance Notice on the day the Advance Notice is
received by the  Investor.  There  shall be a minimum of seven (7) Trading  Days
between each Advance Notice Date.

            (b) Date of Delivery of Advance  Notice.  An Advance Notice shall be
deemed delivered on (i) the Trading Day it is received by facsimile or otherwise
by the Investor if such notice is received  prior to 12:00 noon Eastern Time, or
(ii) the  immediately  succeeding  Trading Day if it is received by facsimile or
otherwise after 12:00 noon Eastern Time on a Trading Day or at any time on a day
which is not a Trading Day. No Advance  Notice may be deemed  delivered on a day
that is not a Trading Day.

      Section 2.3  Termination  of Investment  The obligation of the Investor to
make an  Advance to the  Company  pursuant  to this  Agreement  shall  terminate
permanently  (including  with  respect  to an  Advance  Date  that  has  not yet
occurred)  in the event that (i) there shall occur any stop order or  suspension
of the  effectiveness  of the  Registration  Statement for an aggregate of fifty
(50)  Trading  Days,  other  than due to the acts of the  Investor,  during  the
Commitment  Period,  and (ii) the Company  shall at any time fail  materially to
comply with the  requirements of Article VI and such failure is not cured within
thirty (30) days after receipt of written  notice from the  Investor,  provided,
however,  that  this  termination  provision  shall  not  apply  to  any  period
commencing upon the filing of a  post-effective  amendment to such  Registration
Statement  and ending upon the date on which such post  effective  amendment  is
declared effective by the SEC.

<PAGE>

      Section 2.3. Agreement to Advance Funds The Investor agrees to advance the
amount  specified in the Advance  Notice to the Company after the  completion of
each of the  following  conditions  and the other  conditions  set forth in this
Agreement:

            (a) the execution and delivery by the Company, and the Investor,  of
this Agreement and the Exhibits hereto;

            (b) the Escrow Agent shall have  received the shares of Common Stock
applicable to the Advance in accordance with Section 2.2. (a). Such shares shall
be free of restrictive legends.

            (c) the Company's  Registration Statement with respect to the resale
of the Registrable  Securities in accordance with the terms of the  Registration
Rights Agreement shall have been declared effective by the SEC;

            (d) the  Company  shall  have  obtained  all  material  permits  and
qualifications  required by any  applicable  state for the offer and sale of the
Registrable Securities, or shall have the availability of exemptions there from.
The sale and issuance of the Registrable  Securities shall be legally  permitted
by all laws and regulations to which the Company is subject;

            (e) the  Company  shall have filed with the  Commission  in a timely
manner  all  reports,  notices  and other  documents  required  of a  "reporting
company" under the Exchange Act and applicable Commission regulations;

            (f) the fees as set forth in Section 12.4 below shall have been paid
or can be withheld as provided in Section 2.3; and

            (g) the  conditions  set  forth  in  Section  7.2  shall  have  been
satisfied.

            (h) The  Company's  transfer  agent shall be DWAC  eligible.  In the
alternative,  the  Company's  transfer is not DWAC  eligible,  the Company shall
deposit sufficient shares with a NASD  broker-dealer,  selected by the Investor,
in an account for the  benefit of the  Investor,  to cover two  hundred  percent
(200%) of the amount of shares that can be sold under any single Put.

      Section 2.6. Lock Up Period

            (i) During the  Commitment  Period,  the Company shall not, with the
prior  written  consent of the  Investor  issue or sell (i) any Common  Stock or
Preferred Stock without consideration or for a consideration per share less than
the Bid Price on the date of issuance or (ii) issue or sell any warrant, option,
right,  contract,  call,  or other  security or  instrument  granting the holder
thereof  the  right to  acquire  Common  Stock  without  consideration  or for a
consideration  per  share  less  than the Bid  Price  on the  date of  issuance.
Notwithstanding  anything to the contrary set forth in the immediately preceding
sentence,  the Company may, upon five (5) calendar days prior written  notice to
the  Investor,  issue or sell  shares of Common  Stock or  warrants,  options or
rights to acquire shares of Common Stock, in an amount not to exceed two million
(2,000,000)  shares of the Company's Common Stock, to consultants,  advisors and
independent  contractors for services  rendered or to be rendered to the Company
or its  subsidiaries  at such price per share or exercise price per share as the
Company may determine in any calendar year.

            (ii) On the date hereof,  the Company shall obtain from each officer
and director a lock-up  agreement,  as defined below, in the form annexed hereto
as Schedule 2.6 agreeing to only sell in compliance  with the volume  limitation
of Rule 144.

      Section  2.7.  Hardship  In the event  the  Investor  sells  shares of the
Company's  Common Stock after receipt of an Advance Notice and the Company fails
to perform its obligations as mandated in Section 2.2(a),  and  specifically the
Company  fails to deliver to the Escrow  Agent on the Advance Date the shares of
Common Stock corresponding to the applicable Advance,  the Company  acknowledges
that the Investor shall suffer financial  hardship and therefore shall be liable
for any and all losses,  commissions,  fees, or financial hardship caused to the
Investor.

<PAGE>

                                  ARTICLE III.
                   REPRESENTATIONS AND WARRANTIES OF INVESTOR

      Investor  hereby  represents and warrants to, and agrees with, the Company
that the  following  are true and as of the date  hereof and as of each  Advance
Date:

      Section  3.1.   Organization  and   Authorization  The  Investor  is  duly
incorporated  or  organized  and  validly  existing in the  jurisdiction  of its
incorporation  or  organization  and has all  requisite  power and  authority to
purchase and hold the securities issuable hereunder.  The decision to invest and
the execution and delivery of this Agreement by such Investor,  the  performance
by such  Investor of its  obligations  hereunder  and the  consummation  by such
Investor of the transactions  contemplated  hereby have been duly authorized and
requires no other  proceedings on the part of the Investor.  The undersigned has
the right,  power and  authority to execute and deliver this  Agreement  and all
other  instruments  (including,  without  limitations,  the Registration  Rights
Agreement), on behalf of the Investor. This Agreement has been duly executed and
delivered by the Investor and,  assuming the  execution and delivery  hereof and
acceptance thereof by the Company,  will constitute the legal, valid and binding
obligations of the Investor, enforceable against the Investor in accordance with
its terms.

      Section  3.2.  Evaluation  of Risks The Investor  has such  knowledge  and
experience in financial tax and business  matters as to be capable of evaluating
the  merits  and risks of,  and  bearing  the  economic  risks  entailed  by, an
investment  in the Company and of protecting  its  interests in connection  with
this  transaction.  It recognizes that its investment in the Company  involves a
high degree of risk.

      Section 3.3. No Legal  Advice from the Company The  Investor  acknowledges
that it had the  opportunity  to  review  this  Agreement  and the  transactions
contemplated  by this Agreement with his or its own legal counsel and investment
and tax  advisors.  The Investor is relying  solely on such counsel and advisors
and  not on any  statements  or  representations  of the  Company  or any of its
representatives  or agents for legal,  tax or investment  advice with respect to
this  investment,  the  transactions  contemplated  by  this  Agreement  or  the
securities laws of any jurisdiction.

      Section 3.4.  Investment Purpose The securities are being purchased by the
Investor  for its own  account,  for  investment  and  without  any  view to the
distribution, assignment or resale to others or fractionalization in whole or in
part.  The Investor  agrees not to assign or in any way transfer the  Investor's
rights to the  securities  or any  interest  therein and  acknowledges  that the
Company  will not  recognize  any  purported  assignment  or transfer  except in
accordance with applicable  Federal and state  securities  laws. No other person
has or will have a direct or indirect beneficial interest in the securities. The
Investor  agrees not to sell,  hypothecate or otherwise  transfer the Investor's
securities  unless the securities  are  registered  under Federal and applicable
state securities laws or unless,  in the opinion of counsel  satisfactory to the
Company, an exemption from such laws is available.

      Section 3.5.  Information The Investor and its advisors (and its counsel),
if any,  have  been  furnished  with all  materials  relating  to the  business,
finances and  operations of the Company and  information  it deemed  material to
making an informed investment decision.  The Investor and its advisors,  if any,
have been  afforded  the  opportunity  to ask  questions  of the Company and its
management.  Neither such  inquiries nor any other due diligence  investigations
conducted by such Investor or its advisors, if any, or its representatives shall
modify,  amend  or  affect  the  Investor's  right  to  rely  on  the  Company's
representations  and  warranties  contained  in  this  Agreement.  The  Investor
understands that its investment  involves a high degree of risk. The Investor is
in a position  regarding  the  Company,  which,  based upon  employment,  family
relationship or economic bargaining power,  enabled and enables such Investor to
obtain information from the Company in order to evaluate the merits and risks of
this investment. The Investor has sought such accounting,  legal and tax advice,
as it has  considered  necessary to make an informed  investment  decision  with
respect to this transaction.

      Section  3.6.  Receipt of  Documents  The  Investor  and its counsel  have
received and read in their entirety: (i) this Agreement and the Exhibits annexed
hereto;  (ii) all due  diligence and other  information  necessary to verify the
accuracy and  completeness  of such  representations,  warranties and covenants;
(iii) the Company's  Form 10-KSB for the year ended  December 31, 2005, and Form
10-QSB  for the  period  ended  September  30,  2005;  and (iv)  answers  to all
questions the Investor  submitted to the Company  regarding an investment in the
Company;  and the Investor has relied on the information  contained  therein and
has  not  been  furnished  any  other  documents,   literature,   memorandum  or
prospectus.

<PAGE>

      Section  3.7.  Registration  Rights  Agreement  and Escrow  Agreement  The
parties have  entered  into the  Registration  Rights  Agreement  and the Escrow
Agreement, each dated the date hereof.

      Section 3.8. No General  Solicitation  Neither the Company, nor any of its
affiliates,  nor any person  acting on its or their  behalf,  has engaged in any
form of general  solicitation  or general  advertising  (within  the  meaning of
Regulation D under the Securities  Act) in connection  with the offer or sale of
the shares of Common Stock offered hereby.

      Section 3.9. Not an Affiliate The Investor is not an officer,  director or
a person  that  directly,  or  indirectly  through  one or more  intermediaries,
controls or is controlled by, or is under common control with the Company or any
"Affiliate"  of the  Company  (as  that  term  is  defined  in  Rule  405 of the
Securities Act).

      Section 3.10.  Trading  Activities The Investor's  trading activities with
respect to the Company's Common Stock shall be in compliance with all applicable
federal  and state  securities  laws,  rules and  regulations  and the rules and
regulations  of the  Principal  Market on which the  Company's  Common  Stock is
listed or traded.  Neither the  Investor  nor its  affiliates  has an open short
position in the Common Stock of the Company,  the Investor  agrees that it shall
not, and that it will cause its  affiliates not to, engage in any short sales of
or hedging  transactions  with respect to the Common  Stock,  provided  that the
Company  acknowledges  and agrees  that upon  receipt  of an Advance  Notice the
Investor is permitted  to sell the shares to be issued to the Investor  pursuant
to the Advance Notice during the applicable Pricing Period.

                                   ARTICLE IV.
                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

      Except as stated below, on the disclosure  schedules attached hereto or in
the SEC  Documents  (as defined  herein),  the  Company  hereby  represents  and
warrants to, and  covenants  with,  the Investor that the following are true and
correct as of the date hereof:

      Section  4.1.   Organization  and   Qualification   The  Company  is  duly
incorporated  or  organized  and  validly  existing in the  jurisdiction  of its
incorporation  or  organization  and  has  all  requisite  power  and  authority
corporate  power to own its properties and to carry on its business as now being
conducted.  Each of the  Company and its  subsidiaries  is duly  qualified  as a
foreign corporation to do business and is in good standing in every jurisdiction
in which the nature of the  business  conducted  by it makes such  qualification
necessary,  except to the extent  that the failure to be so  qualified  or be in
good standing  would not have a Material  Adverse  Effect on the Company and its
subsidiaries taken as a whole.

      Section 4.2. Authorization, Enforcement, Compliance with Other Instruments
(i) The Company has the  requisite  corporate  power and authority to enter into
and perform  this  Agreement,  the  Registration  Rights  Agreement,  the Escrow
Agreement,  the  Placement  Agent  Agreement  and  any  related  agreements,  in
accordance with the terms hereof and thereof, (ii) the execution and delivery of
this Agreement,  the Registration  Rights Agreement,  the Escrow Agreement,  the
Placement  Agent  Agreement  and any related  agreements  by the Company and the
consummation by it of the  transactions  contemplated  hereby and thereby,  have
been duly  authorized by the Company's Board of Directors and no further consent
or  authorization  is required by the  Company,  its Board of  Directors  or its
stockholders,  (iii) this Agreement,  the  Registration  Rights  Agreement,  the
Escrow Agreement,  the Placement Agent Agreement and any related agreements have
been duly  executed  and  delivered  by the Company,  (iv) this  Agreement,  the
Registration  Rights  Agreement,  the  Escrow  Agreement,  the  Placement  Agent
Agreement and assuming the execution and delivery  thereof and acceptance by the
Investor and any related agreements constitute the valid and binding obligations
of the Company  enforceable  against the Company in accordance with their terms,
except as such  enforceability may be limited by general principles of equity or
applicable bankruptcy,  insolvency,  reorganization,  moratorium, liquidation or
similar laws relating to, or affecting generally,  the enforcement of creditors'
rights and remedies.

      Section  4.3.  Capitalization  As of December  31,  2005,  the  authorized
capital stock of the Company consists of 100,000,000 shares of Common Stock, par
value  $0.001  per share and  20,000,000  shares of  Preferred  Stock,  of which
22,661,892  shares of Common Stock were issued and  outstanding and 4,600 shares
of Preferred Stock issued and outstanding.  All of such outstanding  shares have
been validly issued and are fully paid and  non-assessable.  Except as disclosed
in the SEC Documents, no shares of Common Stock are subject to preemptive rights
or any other similar rights or any liens or  encumbrances  suffered or permitted
by the Company. Except as disclosed in the SEC Documents, as of the date hereof,
(i) there are no outstanding options,  warrants,  scrip, rights to subscribe to,
calls or commitments of any character  whatsoever  relating to, or securities or
rights  convertible  into,  any shares of capital stock of the Company or any of
its subsidiaries, or contracts,  commitments,  understandings or arrangements by
which the  Company or any of its  subsidiaries  is or may become  bound to issue
additional  shares of capital stock of the Company or any of its subsidiaries or
options,  warrants,  scrip,  rights to subscribe to, calls or commitments of any
character  whatsoever relating to, or securities or rights convertible into, any
shares of capital  stock of the Company or any of its  subsidiaries,  (ii) there
are no outstanding debt securities  (iii) there are no outstanding  registration
statements  other  than  on  Form  S-8  and  (iv)  there  are no  agreements  or
arrangements  under which the Company or any of its subsidiaries is obligated to
register the sale of any of their  securities  under the  Securities Act (except
pursuant to the  Registration  Rights  Agreement).  There are no  securities  or
instruments  containing   anti-dilution  or  similar  provisions  that  will  be
triggered by this Agreement or any related  agreement or the consummation of the
transactions  described  herein or therein.  The Company  has  furnished  to the
Investor true and correct copies of the Company's  Certificate of Incorporation,
as  amended  and  as  in  effect  on  the  date  hereof  (the   "Certificate  of
Incorporation"), and the Company's By-laws, as in effect on the date hereof (the
"By-laws"),  and the terms of all securities convertible into or exercisable for
Common Stock and the material rights of the holders thereof in respect thereto.

<PAGE>

      Section 4.4. No Conflict The execution,  delivery and  performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated  hereby will not (i) result in a violation  of the  Certificate  of
Incorporation,  any certificate of  designations  of any  outstanding  series of
preferred  stock of the Company or By-laws or (ii) conflict with or constitute a
default (or an event  which with notice or lapse of time or both would  become a
default)  under,  or  give to  others  any  rights  of  termination,  amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which
the Company or any of its  subsidiaries  is a party, or result in a violation of
any law, rule,  regulation,  order,  judgment or decree  (including  federal and
state  securities  laws and  regulations  and the rules and  regulations  of the
Principal Market on which the Common Stock is quoted)  applicable to the Company
or any of its  subsidiaries  or by which any  material  property or asset of the
Company or any of its  subsidiaries is bound or affected and which would cause a
Material Adverse Effect.  Except as disclosed in the SEC Documents,  neither the
Company nor its  subsidiaries is in violation of any term of or in default under
its  Articles of  Incorporation  or By-laws or their  organizational  charter or
by-laws,   respectively,   or  any  material  contract,   agreement,   mortgage,
indebtedness,  indenture,  instrument, judgment, decree or order or any statute,
rule or regulation  applicable to the Company or its subsidiaries.  The business
of the Company and its  subsidiaries  is not being conducted in violation of any
material  law,  ordinance,  regulation  of any  governmental  entity.  Except as
specifically contemplated by this Agreement and as required under the Securities
Act and any  applicable  state  securities  laws, the Company is not required to
obtain  any  consent,   authorization  or  order  of,  or  make  any  filing  or
registration with, any court or governmental  agency in order for it to execute,
deliver  or  perform  any of its  obligations  under  or  contemplated  by  this
Agreement or the  Registration  Rights  Agreement in  accordance  with the terms
hereof  or  thereof.   All  consents,   authorizations,   orders,   filings  and
registrations  which the Company is required to obtain pursuant to the preceding
sentence  have been  obtained or effected  on or prior to the date  hereof.  The
Company and its subsidiaries are unaware of any fact or circumstance which might
give rise to any of the foregoing.

      Section 4.5. SEC Documents; Financial Statements Since March 31, 2004, the
Company has filed all reports,  schedules, forms, statements and other documents
required to be filed by it with the SEC under of the  Exchange  Act. The Company
has delivered to the Investor or its representatives,  or made available through
the SEC's  website at  http://www.sec.gov,  true and complete  copies of the SEC
Documents. As of their respective dates, the financial statements of the Company
disclosed in the SEC Documents (the "Financial  Statements") complied as to form
in all  material  respects  with  applicable  accounting  requirements  and  the
published rules and regulations of the SEC with respect thereto.  Such financial
statements have been prepared in accordance with generally  accepted  accounting
principles, consistently applied, during the periods involved (except (i) as may
be otherwise  indicated in such financial  statements or the notes  thereto,  or
(ii) in the  case of  un-audited  interim  statements,  to the  extent  they may
exclude footnotes or may be condensed or summary statements) and, fairly present
in all material  respects the financial  position of the Company as of the dates
thereof and the results of its  operations  and cash flows for the periods  then
ended (subject, in the case of un-audited  statements,  to normal year-end audit
adjustments).  No other  information  provided by or on behalf of the Company to
the  Investor  which is not  included in the SEC  Documents  contains any untrue
statement of a material  fact or omits to state any material  fact  necessary in
order to make the statements  therein,  in the light of the circumstances  under
which they were made, not misleading.

<PAGE>

      Section  4.6.  Rule  10b-5 The SEC  Documents  do not  include  any untrue
statements  of  material  fact,  nor do they  omit to state  any  material  fact
required to be stated therein necessary to make the statements made, in light of
the circumstances under which they were made, not misleading.

      Section  4.7. No Default  Except as disclosed  in the SEC  Documents,  the
Company is not in default  in the  performance  or  observance  of any  material
obligation,  agreement,  covenant  or  condition  contained  in  any  indenture,
mortgage, deed of trust or other material instrument or agreement to which it is
a party or by which it is or its  property is bound and  neither the  execution,
nor the  delivery  by the  Company,  nor the  performance  by the Company of its
obligations  under this Agreement or any of the exhibits or  attachments  hereto
will  conflict  with or result in the breach or violation of any of the terms or
provisions  of, or  constitute a default or result in the creation or imposition
of any lien or  charge on any  assets or  properties  of the  Company  under its
Certificate of Incorporation, By-Laws, any material indenture, mortgage, deed of
trust or other  material  agreement  applicable  to the Company or instrument to
which the  Company is a party or by which it is bound,  or any  statute,  or any
decree, judgment, order, rules or regulation of any court or governmental agency
or body having  jurisdiction  over the Company or its  properties,  in each case
which  default,  lien or charge is likely to cause a Material  Adverse Effect on
the Company's business or financial condition.

      Section 4.8. Absence of Events of Default Except for matters  described in
the SEC Documents and/or this Agreement,  no Event of Default, as defined in the
respective  agreement to which the Company is a party, and no event which,  with
the giving of notice or the  passage of time or both,  would  become an Event of
Default (as so  defined),  has occurred  and is  continuing,  which would have a
Material  Adverse  Effect  on the  Company's  business,  properties,  prospects,
financial condition or results of operations.

      Section 4.9. Intellectual Property Rights The Company and its subsidiaries
own or possess adequate rights or licenses to use all material trademarks, trade
names, service marks, service mark registrations, service names, patents, patent
rights,    copyrights,    inventions,    licenses,    approvals,    governmental
authorizations,  trade secrets and rights  necessary to conduct their respective
businesses as now conducted.  The Company and its  subsidiaries  do not have any
knowledge of any  infringement by the Company or its  subsidiaries of trademark,
trade name rights, patents,  patent rights,  copyrights,  inventions,  licenses,
service names, service marks, service mark registrations,  trade secret or other
similar  rights of others,  and, to the  knowledge of the  Company,  there is no
claim,  action or proceeding being made or brought against,  or to the Company's
knowledge,  being threatened against, the Company or its subsidiaries  regarding
trademark,  trade name, patents, patent rights, invention,  copyright,  license,
service names, service marks, service mark registrations,  trade secret or other
infringement;  and the Company and its  subsidiaries are unaware of any facts or
circumstances which might give rise to any of the foregoing.

      Section  4.10.  Employee  Relations  Neither  the  Company  nor any of its
subsidiaries  is involved in any labor  dispute  nor,  to the  knowledge  of the
Company or any of its subsidiaries,  is any such dispute threatened. None of the
Company's or its subsidiaries'  employees is a member of a union and the Company
and its subsidiaries believe that their relations with their employees are good.

      Section 4.11.  Environmental Laws The Company and its subsidiaries are (i)
in compliance with any and all applicable material foreign,  federal,  state and
local  laws and  regulations  relating  to the  protection  of human  health and
safety,  the environment or hazardous or toxic substances or wastes,  pollutants
or contaminants ("Environmental Laws"), (ii) have received all permits, licenses
or other  approvals  required  of them under  applicable  Environmental  Laws to
conduct their  respective  businesses and (iii) are in compliance with all terms
and conditions of any such permit, license or approval.

      Section 4.12. Title Except as set forth in the SEC Documents,  the Company
has good and marketable title to its properties and material assets owned by it,
free and clear of any pledge,  lien,  security interest,  encumbrance,  claim or
equitable  interest  other than such as are not  material to the business of the
Company.  Any real property and  facilities  held under lease by the Company and
its subsidiaries are held by them under valid, subsisting and enforceable leases
with such  exceptions as are not material and do not interfere with the use made
and proposed to be made of such  property  and  buildings by the Company and its
subsidiaries.

<PAGE>

      Section  4.13.  Insurance  The  Company and each of its  subsidiaries  are
insured by insurers of recognized financial  responsibility  against such losses
and risks and in such  amounts  as  management  of the  Company  believes  to be
prudent  and  customary  in  the   businesses  in  which  the  Company  and  its
subsidiaries  are engaged.  Neither the Company nor any such subsidiary has been
refused any insurance coverage sought or applied for and neither the Company nor
any such  subsidiary has any reason to believe that it will not be able to renew
its existing  insurance  coverage as and when such coverage expires or to obtain
similar  coverage  from  similar  insurers as may be  necessary  to continue its
business at a cost that would not materially and adversely affect the condition,
financial or otherwise,  or the earnings,  business or operations of the Company
and its subsidiaries, taken as a whole.

      Section 4.14.  Regulatory Permits The Company and its subsidiaries possess
all material certificates,  authorizations and permits issued by the appropriate
federal,  state or foreign  regulatory  authorities  necessary to conduct  their
respective  businesses,  and neither the  Company  nor any such  subsidiary  has
received any notice of proceedings relating to the revocation or modification of
any such certificate, authorization or permit.

      Section  4.15.  Internal  Accounting  Controls The Company and each of its
subsidiaries  maintain a system of internal  accounting  controls  sufficient to
provide  reasonable  assurance that (i)  transactions are executed in accordance
with  management's  general or specific  authorizations,  (ii)  transactions are
recorded  as  necessary  to  permit  preparation  of  financial   statements  in
conformity with generally accepted  accounting  principles and to maintain asset
accountability,  (iii) access to assets is  permitted  only in  accordance  with
management's   general  or  specific   authorization   and  (iv)  the   recorded
accountability  for assets is compared  with the existing  assets at  reasonable
intervals and appropriate action is taken with respect to any differences.

      Section 4.16. No Material  Adverse  Breaches,  etc. Except as set forth in
the SEC Documents, neither the Company nor any of its subsidiaries is subject to
any charter,  corporate or other legal  restriction,  or any  judgment,  decree,
order, rule or regulation which in the judgment of the Company's officers has or
is expected  in the future to have a Material  Adverse  Effect on the  business,
properties,  operations, financial condition, results of operations or prospects
of the Company or its  subsidiaries.  Except as set forth in the SEC  Documents,
neither the Company nor any of its  subsidiaries is in breach of any contract or
agreement  which breach,  in the judgment of the Company's  officers,  has or is
expected  to  have  a  Material  Adverse  Effect  on the  business,  properties,
operations,  financial  condition,  results of  operations  or  prospects of the
Company or its subsidiaries.

      Section  4.17.  Absence  of  Litigation  Except  as set  forth  in the SEC
Documents, there is no action, suit, proceeding, inquiry or investigation before
or by any court, public board, government agency,  self-regulatory  organization
or body pending against or affecting the Company, the Common Stock or any of the
Company's subsidiaries, wherein an unfavorable decision, ruling or finding would
(i) have a Material Adverse Effect on the transactions  contemplated hereby (ii)
adversely affect the validity or enforceability  of, or the authority or ability
of the Company to perform its  obligations  under,  this Agreement or any of the
documents contemplated herein, or (iii) except as expressly disclosed in the SEC
Documents,  have  a  Material  Adverse  Effect  on  the  business,   operations,
properties,  financial  condition or results of operation of the Company and its
subsidiaries taken as a whole.

      Section 4.18.  Subsidiaries Except as disclosed in the SEC Documents,  the
Company does not presently own or control, directly or indirectly,  any interest
in any other corporation, partnership, association or other business entity.

      Section  4.19.  Tax Status Except as disclosed in the SEC  Documents,  the
Company  and each of its  subsidiaries  has made or filed all  federal and state
income and all other tax  returns,  reports  and  declarations  required  by any
jurisdiction  to which it is subject and (unless and only to the extent that the
Company  and each of its  subsidiaries  has set  aside on its  books  provisions
reasonably adequate for the payment of all unpaid and unreported taxes) has paid
all taxes and other  governmental  assessments  and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations,
except  those  being  contested  in good  faith  and has set  aside on its books
provision  reasonably  adequate  for  the  payment  of  all  taxes  for  periods
subsequent to the periods to which such returns,  reports or declarations apply.
There are no unpaid taxes in any material amount claimed to be due by the taxing
authority of any jurisdiction,  and the officers of the Company know of no basis
for any such claim.

      Section  4.20.  Certain  Transactions  Except  as set  forth  in  the  SEC
Documents  none of the  officers,  directors,  or  employees  of the  Company is
presently a party to any  transaction  with the Company (other than for services
as employees,  officers and  directors),  including  any contract,  agreement or
other  arrangement  providing for the furnishing of services to or by, providing
for rental of real or  personal  property  to or from,  or  otherwise  requiring
payments to or from any officer,  director or such employee or, to the knowledge
of the Company, any corporation, partnership, trust or other entity in which any
officer,  director,  or any such  employee has a  substantial  interest or is an
officer, director, trustee or partner.

<PAGE>

      Section  4.21.  Fees  and  Rights  of First  Refusal  The  Company  is not
obligated to offer the securities  offered hereunder on a right of first refusal
basis or otherwise to any third parties  including,  but not limited to, current
or former shareholders of the Company,  underwriters,  brokers,  agents or other
third parties.

      Section 4.22.  Use of Proceeds The Company shall use the net proceeds from
this offering for general corporate purposes, including, without limitation, the
payment of loan incurred by the Company.  However, in no event shall the Company
use the net proceeds from this offering,  for the payment (or loaned to any such
person for the payment) of any  judgment,  or other  liability,  incurred by any
executive officer,  officer, director or employee of the Company, except for any
liability owed to such person for services rendered, or if any judgment or other
liability is incurred by such person  originating from services  rendered to the
Company, or the Company has indemnified such person from liability.

      Section 4.23. Further  Representation and Warranties of the Company For so
long  as  any  securities   issuable  hereunder  held  by  the  Investor  remain
outstanding, the Company acknowledges,  represents,  warrants and agrees that it
will maintain the listing of its Common Stock on the Principal Market.

      Section 4.24. Opinion of Counsel The Company will obtain for the Investor,
at the  Company's  expense,  any  and  all  opinions  of  counsel  which  may be
reasonably  required in order to sell the securities  issuable hereunder without
restriction.

      Section 4.25. Dilution The Company is aware and acknowledges that issuance
of shares of the  Company's  Common  Stock  could  cause  dilution  to  existing
shareholders and could  significantly  increase the outstanding number of shares
of Common Stock.

                                   ARTICLE V.
                                 INDEMNIFICATION

      The Investor and the Company  represent  to the other the  following  with
respect to itself:

      Section 5.1. Indemnification

            (a) In  consideration  of the  Investor's  execution and delivery of
this Agreement,  and in addition to all of the Company's other obligations under
this Agreement,  the Company shall defend, protect,  indemnify and hold harmless
the Investor, and all of its officers, directors, partners, employees and agents
(including,   without   limitation,   those  retained  in  connection  with  the
transactions  contemplated  by  this  Agreement)  (collectively,  the  "Investor
Indemnitees")  from and against any and all  actions,  causes of action,  suits,
claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith  (irrespective of whether any such Investor Indemnitee is a
party  to the  action  for  which  indemnification  hereunder  is  sought),  and
including  reasonable   attorneys'  fees  and  disbursements  (the  "Indemnified
Liabilities"),  incurred by the Investor  Indemnitees or any of them as a result
of, or arising out of, or relating to (a) any misrepresentation or breach of any
representation  or  warranty  made  by the  Company  in  this  Agreement  or the
Registration  Rights Agreement or any other certificate,  instrument or document
contemplated  hereby or thereby,  (b) any breach of any  covenant,  agreement or
obligation of the Company contained in this Agreement or the Registration Rights
Agreement or any other certificate,  instrument or document  contemplated hereby
or thereby,  or (c) any cause of action,  suit or claim  brought or made against
such  Investor  Indemnitee  not  arising  out of any  action or  inaction  of an
Investor  Indemnitee,  and  arising  out of or  resulting  from  the  execution,
delivery,  performance or enforcement of this Agreement or any other instrument,
document  or  agreement   executed  pursuant  hereto  by  any  of  the  Investor
Indemnitees.  To the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum contribution to
the payment and  satisfaction of each of the Indemnified  Liabilities,  which is
permissible under applicable law.

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

<PAGE>

            (c) The obligations of the parties to indemnify or make contribution
under this Section 5.1 shall survive termination.

                                   ARTICLE VI.
                            COVENANTS OF THE COMPANY

      Section 6.1.  Registration Rights The Company shall cause the Registration
Rights Agreement to remain in full force and effect and the Company shall comply
in all material respects with the terms thereof.

      Section 6.2. Listing of Common Stock The Company shall maintain the Common
Stock's authorization for quotation on the Principal Market.

      Section 6.3.  Exchange Act  Registration The Company will cause its Common
Stock to continue to be registered under Section 12(g) of the Exchange Act, will
file in a timely  manner all  reports  and other  documents  required of it as a
reporting  company  under the  Exchange Act and will not take any action or file
any document (whether or not permitted by Exchange Act or the rules there under)
to  terminate  or suspend  such  registration  or to  terminate  or suspend  its
reporting and filing obligations under said Exchange Act.

      Section  6.4.  Transfer  Agent  Instructions  Upon  effectiveness  of  the
Registration  Statement the Company shall deliver  instructions  to its transfer
agent to issue  shares  of  Common  Stock to the  Investor  free of  restrictive
legends on or before each  Advance  Date.  Further,  in the event the  Company's
transfer  agent is not DWAC  eligible,  the Company shall  instruct its transfer
agent to issue sufficient  shares,  to be deposited into a brokerage account for
the benefit of the Investor,  to cover two hundred  percent (200%) of the amount
of shares that can be sold under any single Put,  as  calculated  on the date of
execution of this Agreement.

      Section 6.5. Corporate Existence The Company will take all steps necessary
to preserve and continue the corporate existence of the Company.

      Section 6.6. Notice of Certain Events Affecting  Registration;  Suspension
of Right to Make an Advance The Company  will  immediately  notify the  Investor
upon its becoming  aware of the  occurrence  of any of the  following  events in
respect  of a  registration  statement  or  related  prospectus  relating  to an
offering of  Registrable  Securities:  (i) receipt of any request for additional
information  by the SEC or any other  Federal  or state  governmental  authority
during the period of effectiveness of the Registration  Statement for amendments
or supplements to the  registration  statement or related  prospectus;  (ii) the
issuance by the SEC or any other Federal or state governmental  authority of any
stop order suspending the  effectiveness  of the  Registration  Statement or the
initiation  of  any  proceedings   for  that  purpose;   (iii)  receipt  of  any
notification  with respect to the suspension of the  qualification  or exemption
from  qualification  of  any of  the  Registrable  Securities  for  sale  in any
jurisdiction  or the  initiation  or  threatening  of any  proceeding  for  such
purpose;  (iv) the happening of any event that makes any  statement  made in the
Registration  Statement or related  prospectus of any document  incorporated  or
deemed to be incorporated therein by reference untrue in any material respect or
that requires the making of any changes in the Registration  Statement,  related
prospectus or documents so that, in the case of the Registration  Statement,  it
will not contain any untrue  statement  of a material  fact or omit to state any
material fact required to be stated  therein or necessary to make the statements
therein not misleading,  and that in the case of the related prospectus, it will
not  contain  any  untrue  statement  of a  material  fact or omit to state  any
material fact required to be stated  therein or necessary to make the statements
therein,  in the light of the  circumstances  under  which they were  made,  not
misleading; and (v) the Company's reasonable determination that a post-effective
amendment to the  Registration  Statement would be appropriate;  and the Company
will promptly make available to the Investor any such supplement or amendment to
the related  prospectus.  The  Company  shall not  deliver to the  Investor  any
Advance Notice during the continuation of any of the foregoing events.

<PAGE>

      Section 6.7  Restriction  on Sale of Capital  Stock During the  Commitment
Period, the Company shall not issue or sell without the prior written consent of
the Investor (i) any Common Stock or Preferred  Stock without  consideration  or
for a  consideration  per  share  less than the bid  price of the  Common  Stock
determined  immediately prior to its issuance,  (ii) issue or sell any Preferred
Stock warrant,  option, right,  contract,  call, or other security or instrument
granting  the  holder   thereof  the  right  to  acquire  Common  Stock  without
consideration or for a consideration per share less than such Common Stock's Bid
Price  determined   immediately  prior  to  its  issuance,  or  (iii)  file  any
registration  statement on Form S-8,  except that the Company may, upon five (5)
calendar days prior written notice, file one or more registration  statements on
Form S-8,  in an amount not to exceed two million  (2,000,000)  shares of common
stock,  with respect to any securities  issued and sold or to be issued and sold
to consultants, advisors and independent contractors for services rendered or to
be rendered to the Company or its  subsidiaries  and the Company may file one or
more  registration  statements  on Form S-8 with  respect  to  options or shares
underlying options granted to directors, officers or employees of the Company or
its subsidiaries pursuant to the Company's 2005 Stock Option Plan, provided that
the  number  of  shares  registered  for the  benefit  directors,  officers  and
employees  of the  Company  and its  subsidiaries  may not  exceed  one  million
(1,000,000) shares in any calendar year.

      Section  6.8.  Consolidation;  Merger The  Company  shall not, at any time
after the date hereof, effect any merger or consolidation of the Company with or
into,  or a transfer  of all or  substantially  all the assets of the Company to
another  entity (a  "Consolidation  Event")  unless the  resulting  successor or
acquiring  entity  (if  not the  Company)  assumes  by  written  instrument  the
obligation to deliver to the Investor such shares of stock and/or  securities as
the Investor is entitled to receive pursuant to this Agreement.

      Section 6.9. Issuance of the Company's Common Stock The sale of the shares
of Common Stock shall be made in accordance with the provisions and requirements
of Regulation D and any applicable state securities law.

                                  ARTICLE VII.
                CONDITIONS FOR ADVANCE AND CONDITIONS TO CLOSING

      Section 7.1.  Conditions  Precedent to the  Obligations of the Company The
obligation hereunder of the Company to issue and sell the shares of Common Stock
to the  Investor  incident to each  Closing is subject to the  satisfaction,  or
waiver by the Company, at or before each such Closing, of each of the conditions
set forth below.

            (a) Accuracy of the  Investor's  Representations  and Warranties The
representations  and warranties of the Investor shall be true and correct in all
material respects.

            (b)  Performance by the Investor The Investor shall have  performed,
satisfied  and  complied in all  respects  with all  covenants,  agreements  and
conditions  required by this Agreement and the Registration  Rights Agreement to
be  performed,  satisfied  or complied  with by the Investor at or prior to such
Closing.

      Section 7.2.  Conditions  Precedent to the Right of the Company to Deliver
an Advance  Notice and the  Obligation  of the  Investor to  Purchase  Shares of
Common  Stock The right of the  Company to  deliver  an  Advance  Notice and the
obligation  of the  Investor  hereunder  to  acquire  and pay for  shares of the
Company's  Common Stock  incident to a Closing is subject to the  fulfillment by
the  Company,  on (i) the date of delivery of such  Advance  Notice and (ii) the
applicable Advance Date (each a "Condition  Satisfaction  Date"), of each of the
following conditions:

            (a)  Registration of the Common Stock with the SEC The Company shall
have filed with the SEC a  Registration  Statement with respect to the resale of
the  Registrable  Securities  in accordance  with the terms of the  Registration
Rights  Agreement.  As set  forth  in the  Registration  Rights  Agreement,  the
Registration  Statement shall have previously  become effective and shall remain
effective on each  Condition  Satisfaction  Date and (i) neither the Company nor
the Investor  shall have  received  notice that the SEC has issued or intends to
issue a stop order with  respect to the  Registration  Statement or that the SEC
otherwise  has  suspended or withdrawn  the  effectiveness  of the  Registration
Statement, either temporarily or permanently, or intends or has threatened to do
so (unless the SEC's concerns have been addressed and the Investor is reasonably
satisfied that the SEC no longer is considering or intends to take such action),
and (ii) no other  suspension of the use or withdrawal of the  effectiveness  of
the Registration  Statement or related  prospectus shall exist. The Registration
Statement  must  have  been  declared  effective  by the SEC  prior to the first
Advance Notice Date.

<PAGE>

            (b)  Authority  The  Company  shall have  obtained  all  permits and
qualifications   required  by  any  applicable  state  in  accordance  with  the
Registration  Rights  Agreement  for the offer and sale of the  shares of Common
Stock,  or shall have the  availability  of exemptions  there from. The sale and
issuance of the shares of Common  Stock shall be legally  permitted  by all laws
and regulations to which the Company is subject.

            (c)  Fundamental  Changes  There  shall not  exist  any  fundamental
changes to the information set forth in the  Registration  Statement which would
require  the  Company to file a  post-effective  amendment  to the  Registration
Statement.

            (d)  Performance  by the Company The Company  shall have  performed,
satisfied and complied in all material  respects with all covenants,  agreements
and conditions required by this Agreement  (including,  without limitation,  the
conditions  specified  in  Section  2.5  hereof)  and  the  Registration  Rights
Agreement to be performed, satisfied or complied with by the Company at or prior
to each Condition Satisfaction Date.

            (e) No Injunction No statute,  rule,  regulation,  executive  order,
decree,  ruling or injunction shall have been enacted,  entered,  promulgated or
endorsed by any court or governmental  authority of competent  jurisdiction that
prohibits or directly and adversely affects any of the transactions contemplated
by this Agreement, and no proceeding shall have been commenced that may have the
effect  of   prohibiting  or  adversely   affecting  any  of  the   transactions
contemplated by this Agreement.

            (f) No  Suspension  of Trading in or  Delisting  of Common Stock The
trading of the Common Stock is not suspended by the SEC or the Principal  Market
(if the Common Stock is traded on a Principal Market). The issuance of shares of
Common Stock with respect to the applicable  Closing,  if any, shall not violate
the shareholder  approval  requirements  of the Principal  Market (if the Common
Stock is traded on a Principal Market).  The Company shall not have received any
notice  threatening  the continued  listing of the Common Stock on the Principal
Market (if the Common Stock is traded on a Principal Market).

            (g) Maximum Advance Amount The amount of an Advance requested by the
Company shall not exceed the Maximum  Advance Amount.  In addition,  in no event
shall the number of shares issuable to the Investor pursuant to an Advance cause
the  aggregate  number  of  shares of  Common  Stock  beneficially  owned by the
Investor and its  affiliates to exceed nine and 9/10 percent  (9.9%) of the then
outstanding  Common  Stock  of  the  Company.  For  purposes  of  this  section,
beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act.

            (h) No  Knowledge  The Company has no  knowledge  of any event which
would be more  likely than not to have the effect of causing  such  Registration
Statement to be suspended or otherwise ineffective.

            (i) Other On each  Condition  Satisfaction  Date, the Investor shall
have received the certificate  executed by an officer of the Company in the form
of Exhibit A attached hereto.

                                  ARTICLE VIII.
         DUE DILIGENCE REVIEW; NON-DISCLOSURE OF NON-PUBLIC INFORMATION

      Section 8.1. Due Diligence  Review Prior to the filing of the Registration
Statement the Company  shall make  available  for  inspection  and review by the
Investor, its advisors and representatives, and any underwriter participating in
any disposition of the Registrable Securities on behalf of the Investor pursuant
to the Registration  Statement,  any such registration statement or amendment or
supplement  thereto or any blue sky,  NASD or other  filing,  all  financial and
other  records,  all SEC Documents and other filings with the SEC, and all other
corporate documents and properties of the Company as may be reasonably necessary
for the purpose of such review, and cause the Company's officers,  directors and
employees to supply all such information reasonably requested by the Investor or
any  such  representative,  advisor  or  underwriter  in  connection  with  such
Registration  Statement  (including,  without  limitation,  in  response  to all
questions  and other  inquiries  reasonably  made or  submitted by any of them),
prior to and  from  time to time  after  the  filing  and  effectiveness  of the
Registration  Statement  for the sole  purpose of enabling the Investor and such
representatives,  advisors and underwriters and their respective accountants and
attorneys  to conduct  initial  and ongoing due  diligence  with  respect to the
Company and the accuracy of the Registration Statement.

<PAGE>

      Section 8.2. Non-Disclosure of Non-Public Information

            (a) The Company  shall not disclose  non-public  information  to the
Investor,  its advisors,  or its representatives,  unless prior to disclosure of
such  information the Company  identifies such  information as being  non-public
information and provides the Investor,  such advisors and  representatives  with
the  opportunity to accept or refuse to accept such  non-public  information for
review. The Company may, as a condition to disclosing any non-public information
hereunder,  require the Investor's  advisors and representatives to enter into a
confidentiality agreement in form reasonably satisfactory to the Company and the
Investor.

            (b) Nothing herein shall require the Company to disclose  non-public
information to the Investor or its advisors or representatives,  and the Company
represents that it does not disseminate  non-public information to any investors
who purchase stock in the Company in a public offering,  to money managers or to
securities analysts,  provided, however, that notwithstanding anything herein to
the contrary, the Company will, as hereinabove provided,  immediately notify the
advisors and representatives of the Investor and, if any,  underwriters,  of any
event or the existence of any  circumstance  (without any obligation to disclose
the specific  event or  circumstance)  of which it becomes  aware,  constituting
non-public  information (whether or not requested of the Company specifically or
generally  during  the course of due  diligence  by such  persons or  entities),
which, if not disclosed in the prospectus included in the Registration Statement
would  cause such  prospectus  to include a material  misstatement  or to omit a
material  fact  required to be stated  therein in order to make the  statements,
therein,  in light of the circumstances in which they were made, not misleading.
Nothing  contained  in this  Section  8.2 shall be  construed  to mean that such
persons or entities other than the Investor  (without the written consent of the
Investor  prior to disclosure  of such  information)  may not obtain  non-public
information  in the course of conducting  due  diligence in accordance  with the
terms of this  Agreement  and nothing  herein shall  prevent any such persons or
entities  from  notifying  the Company of their  opinion  that based on such due
diligence by such persons or entities,  that the Registration Statement contains
an untrue  statement of material  fact or omits a material  fact  required to be
stated  in the  Registration  Statement  or  necessary  to make  the  statements
contained  therein,  in light of the  circumstances in which they were made, not
misleading.

                                   ARTICLE IX.
                           CHOICE OF LAW/JURISDICTION

      Section  9.1.  Governing  Law  This  Agreement  shall be  governed  by and
interpreted in accordance with the laws of the State of Nevada without regard to
the  principles of conflict of laws.  The parties  further agree that any action
between them shall be heard in Clark County,  Nevada,  and expressly  consent to
the  jurisdiction  and venue of the Superior  Court of Nevada,  sitting in Clark
County,  Las  Vegas,  Nevada  and the United  States  District  Court of Nevada,
sitting in Las Vegas,  Nevada, for the adjudication of any civil action asserted
pursuant to this paragraph.

                                   ARTICLE X.
                             ASSIGNMENT; TERMINATION

      Section  10.1.  Assignment  Neither this  Agreement  nor any rights of the
Company hereunder may be assigned to any other Person.

      Section 10.2. Termination The obligations of the Investor to make Advances
under  Article II hereof  shall  terminate  twenty-four  (24)  months  after the
Effective  Date.  Notwithstanding  the  foregoing,  provided  that  there are no
Advance  Notices  pending the Company may terminate  this Agreement by providing
the Investor not less than sixty (60) calendar days prior written notice.

                                   ARTICLE XI.
                                     NOTICES

      Section  11.1.   Notices  Any  notices,   consents,   waivers,   or  other
communications  required  or  permitted  to be  given  under  the  terms of this
Agreement  must be in writing and will be deemed to have been delivered (i) upon
receipt, when delivered  personally;  (ii) upon receipt, when sent by facsimile,
provided a copy is mailed by overnight  deliver service within one (1) day after
being  sent  by  facsimile,   or  (iii)  one  (1)  day  after  deposit  with  an
internationally  recognized  overnight  delivery service,  in each case properly
addressed to the party to receive the same. The addresses and facsimile  numbers
for such communications shall be:

<PAGE>

If to the Company, to:         GeneThera, Inc.
                               Attn:  Dr. Antonio Milici, CEO
                               3930 Youngfield St.
                               Wheat Ridge, CO  80033
                               Fax: (303) 463 - 6377

If to the Investor:            Imperial Capital Holdings, LLC.
                               Centro Colon
                               Piso 8, Oficina 8-4
                               Apdo. 10559-1000
                               San Jose, Costa Rica Fax:
                               (305) 832 - 0296

            Each party shall provide five (5) days' prior written  notice to the
other party of any change in address or facsimile number.

                                  ARTICLE XII.
                                  MISCELLANEOUS

      Section 12.1.  Counterparts  This Agreement may be executed in two or more
identical  counterparts,  all of  which  shall  be  considered  one and the same
agreement and shall become effective when  counterparts have been signed by each
party and  delivered  to the other  party.  In the event any  signature  page is
delivered  by  facsimile  transmission,  the party  using such means of delivery
shall  cause  four  (4)  additional  original  executed  signature  pages  to be
physically  delivered to the other party  within five (5) days of the  execution
and delivery hereof,  though failure to deliver such copies shall not affect the
validity of this Agreement.

      Section 12.2. Entire Agreement;  Amendments This Agreement  supersedes all
other prior oral or written agreements between the Investor,  the Company, their
affiliates  and  persons  acting on their  behalf  with  respect to the  matters
discussed  herein,  and this  Agreement and the  instruments  referenced  herein
contain  the entire  understanding  of the parties  with  respect to the matters
covered  herein and therein  and,  except as  specifically  set forth  herein or
therein,  neither  the  Company  nor  the  Investor  makes  any  representation,
warranty,  covenant or undertaking with respect to such matters. No provision of
this  Agreement  may be waived or amended other than by an instrument in writing
signed by the party to be charged with enforcement.

      Section 12.3.  Reporting  Entity for the Common Stock The reporting entity
relied upon for the  determination of the trading price or trading volume of the
Common Stock on any given Trading Day for the purposes of this  Agreement  shall
be Bloomberg,  L.P. or any successor thereto.  The written mutual consent of the
Investor and the Company shall be required to employ any other reporting entity.

      Section  12.4.  Fees and  Expenses  The Company  hereby  agrees to pay the
following fees:

            (a) Structuring Fees. Each of the parties shall pay its own fees and
expenses (including the fees of any attorneys, accountants, appraisers or others
engaged by such party) in connection  with this  Agreement and the  transactions
contemplated  hereby,  except that the  Company  will pay a  structuring  fee of
Fifteen Thousand Dollars  ($15,000) to Imperial  Capital  Holdings,  LLC., which
shall be payable from the proceeds of the first Put.

            (b) Commitment Fees.

                  (i) Upon the  execution of this  Agreement  the Company  shall
issue to the Investor shares of the Company's Common Stock in an amount equal to
One Hundred  Thousand  Dollars  ($100,000)  divided by the VWAP of the Company's
Common Stock,  as quoted by Bloomberg,  LP, on the date hereof (the  "Investor's
Shares") of which the Investor shall be restricted  from selling an amount equal
to or greater than Fifty Thousand Dollars of the Investor's  Shares for a period
of one hundred twenty (120) calendar days from the date hereof.

<PAGE>

                  (ii) Fully Earned. The Investor's Shares shall be deemed fully
earned as of the date hereof

                  (iii)  Registration  Rights.  The Investor's  Shares will have
"piggy-back" registration rights.

      Section 12.5.  Brokerage Each of the parties hereto represents that it has
had no dealings in connection  with this  transaction  with any finder or broker
who will  demand  payment of any fee or  commission  from the other  party.  The
Company on the one hand, and the Investor, on the other hand, agree to indemnify
the other against and hold the other  harmless from any and all  liabilities  to
any  person  claiming  brokerage  commissions  or  finder's  fees on  account of
services  purported to have been rendered on behalf of the indemnifying party in
connection with this Agreement or the transactions contemplated hereby.

      Section  12.6.   Confidentiality   If  for  any  reason  the  transactions
contemplated by this Agreement are not  consummated,  each of the parties hereto
shall keep  confidential  any information  obtained from any other party (except
information  publicly  available  or in such  party's  domain  prior to the date
hereof,  and except as required by court order) and shall promptly return to the
other  parties  all  schedules,  documents,  instruments,  work  papers or other
written information without retaining copies thereof, previously furnished by it
as a result of this Agreement or in connection herein.

      IN WITNESS WHEREOF,  the parties hereto have caused this Equity Investment
Agreement to be executed by the undersigned,  thereunto duly  authorized,  as of
the date first set forth above.

                           COMPANY:
                           GENETHERA, INC.

                           By:    Antonio Milici
                              --------------------------------------
                           Name:  Antonio Milici
                           Title: Chairman & Chief Executive Officer

                           INVESTOR:
                           IMPERIAL CAPITAL HOLDINGS, LLC.

                           By:    Maritza Sanabria
                              --------------------------------------
                           Name:  Maritza Sanabria
                           Title: Managing Director

<PAGE>

                                    EXHIBIT A

                      ADVANCE NOTICE/COMPLIANCE CERTIFICATE

                                 GENETHERA, INC.

      The undersigned, _______________________ hereby certifies, with respect to
the sale of shares of Common Stock of GENETHERA, INC. (the "Company"),  issuable
in  connection  with  this  Advance  Notice  and  Compliance  Certificate  dated
___________________ (the "Notice"),  delivered pursuant to the Equity Investment
Agreement (the "Agreement"), as follows:

      1. The undersigned is the duly elected ______________ of the Company.

      2. There are no fundamental  changes to the  information  set forth in the
Registration  Statement which would require the Company to file a post effective
amendment to the Registration Statement.

      3. The Company has  performed in all material  respects all  covenants and
agreements  to be  performed  by the  Company  on or prior to the  Advance  Date
related  to the  Notice  and has  complied  in all  material  respects  with all
obligations and conditions contained in the Agreement.

      4. The undersigned hereby  represents,  warrants and covenants that it has
made  all  filings  ("SEC  Filings")  required  to be  made  by it  pursuant  to
applicable securities laws (including,  without limitation, all filings required
under the Securities  Exchange Act of 1934, which include Forms 10-Q, 10-K, 8-K,
etc.  All  SEC  Filings  and  other  public  disclosures  made  by the  Company,
including,  without limitation, all press releases, analysts meetings and calls,
etc. (collectively,  the "Public Disclosures"),  have been reviewed and approved
for release by the Company's attorneys and, if containing financial information,
the Company's  independent  certified public accountants.  None of the Company's
Public  Disclosures  contain any untrue  statement of a material fact or omit to
state any material fact  required to be stated  therein or necessary to make the
statements  therein,  in the light of the  circumstances  under  which they were
made, not misleading.

      5. The Advance requested is _____________________.

      The   undersigned  has  executed  this   Certificate   this  ____  day  of
_________________.

                           GENETHERA, INC.

                           By:_________________________________

                           Name:  Dr. Antonio Milici
                           Title: CEO

<PAGE>

                                  SCHEDULE 2.6

                                 GENETHERA, INC.

      The  undersigned  hereby  agrees that for a period  commencing on the date
hereof and expiring on the termination of the Equity Investment Agreement, dated
May 2, 2006,  between  GeneThera,  Inc., (the  "Company"),  and Imperial Capital
Holdings, LLC., (the "Investor") (the "Lock-up Period"), he, she or it will not,
directly or  indirectly,  without  the prior  written  consent of the  Investor,
issue,  offer, agree or offer to sell, sell, grant an option for the purchase or
sale of, transfer, pledge, assign, hypothecate, distribute or otherwise encumber
or dispose of except  pursuant to Rule 144 of the General Rules and  Regulations
under the  Securities  Act of 1933,  any  securities  of the Company,  including
common  stock or  options,  rights,  warrants  or other  securities  underlying,
convertible  into,  exchangeable  or exercisable  for or evidencing any right to
purchase or subscribe for any common stock (whether or not beneficially owned by
the  undersigned),  or  any  beneficial  interest  therein  (collectively,   the
"Securities").

      In order to enable the aforesaid covenants to be enforced, the undersigned
hereby consents to the placing of legends and/or  stop-transfer  orders with the
transfer agent of the Company's securities with respect to any of the Securities
registered  in  the  name  of  the  undersigned  or  beneficially  owned  by the
undersigned, and the undersigned hereby confirms the undersigned's investment in
the Company.

Dated: _______________, 2006

                           Signature __________________________________

                           Name: ______________________________
                           Address:____________________________
                                   ____________________________

                           _______________________________________
                           Print Social Security Number
                           or Taxpayer I.D. Number

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00108-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00108-of-00352.parquet"}]]