Document:

EXHIBIT 10.1
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                           PURCHASE AND SALE AGREEMENT
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     THIS PURCHASE AND SALE AGREEMENT  (this  "Agreement") is made this 20th day
of October,  2004, by and between FIRST MARINER BANCORP, a Maryland corporation,
hereinafter  referred to as "Purchaser,"  and CANTON  CROSSING,  LLC, a Maryland
limited liability  company,  and HALE CANTON,  LLC, a Maryland limited liability
company, hereinafter collectively referred to as "Seller."

                                    RECITALS
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     A. Seller is the owner of 100% of the membership interests (the "Membership
Interests") in CANTON  CROSSING II, LLC, a Maryland  limited  liability  company
(the "Company").

     B. The Company owns the real  property  (the "Land") and the  improvements,
structures, and fixtures now constructed and completed or under construction and
situated  thereon (the  "Building"),  located at 3301 Boston Street,  Baltimore,
Maryland, as more particularly described in Exhibit A attached hereto,  together
with all of the Company's  rights,  if any, to architectural  plans, site plans,
sewer, water and other utility approvals,  permits and licenses,  for and to the
Land and  Building,  including but not limited to, any prepaid  impact,  access,
services,  and other fees of any kind, all contract  rights and all other rights
appurtenant to the Land and the Building  (hereinafter  collectively referred to
as the "Property").

     C. The  Company  is the sole  member  and  owner of 100% of the  membership
interests in Canton Crossing Borrower, LLC, a Maryland limited liability company
("Borrower").

     D.  Borrower is the  borrower on an existing  mortgage  loan secured by the
Property,  which loan is in the original principal amount of Ten Million Dollars
($10,000,000.00)  and is evidenced by a promissory  note dated July 9, 2003 (the
"Loan").  The Company is a guarantor of the Loan and the grantor of an indemnity
deed of trust on the Property to secure the Loan.

     E. The Company is party to certain  leases,  as  landlord,  for  commercial
office space  within the Building  (the  "Leases")  with First  Mariner Bank and
other direct or indirect  subsidiaries of Purchaser,  in addition to third-party
tenants (the  "Tenants").  The Leases,  excepting the First Mariner leases,  are
attached hereto as Exhibit B.

     F.  Purchaser  desires to purchase  Seller's  Membership  Interests  in the
Company, which Membership Interests include all assets of the Company including,
but not limited to, the Property,  the Leases,  and the membership  interests in
Borrower and Seller has agreed to sell its  Membership  Interests in the Company
on the terms set forth herein.

     NOW,  THEREFORE,  WITNESSETH,  that for and in  consideration of the mutual
terms promises and agreements herein contained,  and for other good and valuable
consideration,  the receipt and  adequacy of which is hereby  acknowledged,  the
parties hereto do hereby agree as follows:

<PAGE>

     1.  Recitals.   The  foregoing  Recitals  are  incorporated   herein  as  a
substantive part of this Agreement.

     2. Purchase and Sale of Membership Interests.  Seller agrees to sell, grant
and  convey,  and  Purchaser  agrees to  purchase  and  accept,  the  Membership
Interests,  on the terms set forth herein, free and clear of all liens, charges,
restrictions, encumbrances and security interests of any kind.

          (a) Purchase  Price.  The purchase price to be paid for the Membership
Interests  shall be  Twenty  Million  Dollars  ($20,000,000.00)  (the  "Purchase
Price").

          (b)  Purchase  Deposit.  Within  three (3) days of the  execution  and
delivery of this  Agreement by the parties  (the  "Effective  Date"),  Purchaser
shall deposit with Kenilworth Title Company, LLC ("Escrow Agent") the sum of One
Hundred Thousand Dollars ($100,000.00) ("Purchase Deposit") to be held by Escrow
Agent in an interest-bearing  federally insured account pursuant to the terms of
this  Agreement.  All  interest on the Purchase  Deposit  shall be for credit of
Purchaser.  The Purchase  Deposit shall be applied  toward the Purchase Price at
Closing (as hereinafter defined).

          (c)  Payment of  Purchase  Price.  Purchaser  agrees to pay Seller the
Purchase Price at Closing. The Purchase Price shall be paid as follows:

               (i) Purchaser will assume the  outstanding  principal  balance on
the Loan as described in Section 3(a)  hereof,  which  principal  loan amount is
approximately Ten Million Dollars ($10,000,000.00);

               (ii) Purchaser  shall pay the difference  between the outstanding
principal  balance of the Loan and the Purchase  Price via wire  transfer or via
certified funds, at the option of Seller.

          (d)  Closing/Closing  Date.  Seller and Purchaser agree to make a full
settlement in accordance  with the terms hereof within one hundred  eighty (180)
days from the Effective  Date or such earlier date as the parties may agree (the
"Closing" or "Closing Date").

               (i) Either  party may  request one (1)  extension  of the Closing
Date for a period of up to of ninety (90) days. Such request shall be in writing
and  delivered  to the other  party  not less  than ten (10)  days  prior to the
Closing Date.

          (e) Place of  Settlement.  The Closing shall take place at the offices
of Escrow Agent or such other place as the parties may agree.

          (f) Payment of Settlement  Costs.  Seller shall pay at the Closing any
amounts required to satisfy any open judgments against Seller or the Company and
any amounts  required to obtain the release of any other monetary liens upon the
Land,  other than the lien of the Loan.  Purchaser  shall pay at the Closing any
costs in connection  with the issuance of an owner's title  insurance  policy or
the assignment of the Company's owner's title insurance policy and the amendment
of the  Lender's  title  insurance  coverage.  Each  party  shall  pay  its  own
attorneys' fees incurred.

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<PAGE>

               (i) In the event that,  either prior to Closing or after Closing,
the State of Maryland and/or Baltimore City imposes  recordation and/or transfer
taxes on this  transaction,  then Purchaser  shall be responsible for the timely
payment of fifty percent (50%) of such  recordation  and/or  transfer  taxes and
Seller shall be responsible  for the timely payment of the remaining  balance of
such recordation and/or transfer taxes.

          (g) Payment for Escrow Reserve Account Funds. Purchaser shall
pay to Seller at Closing an amount equal to the total amount of the funds then
in the following escrow reserve accounts maintained with GEMSA Loan Services,
L.P. related to the Loan: (i) tax, (ii) insurance, and (iii) other (the "other"
escrow reserve account includes funds for repairs, tenant improvements, and
capital improvements) (collectively, the "Escrow Funds"). At the time of Closing
Seller will assign to Purchaser all Seller's interest in, and rights to, the
Escrow Funds and no distributions from the escrow reserve accounts shall be made
to Seller.

     3. Contingencies. Seller agrees that Purchaser's obligation to purchase the
Membership Interests is contingent on the following conditions (any of which
may be waived in whole or in part by Purchaser at or prior to the Closing):

          (a) Lender's  Consent.  Seller shall have  seventy-five (75) days from
the Effective Date to provide  Purchaser with the written consent of the current
holder of the Loan, or its servicing  agent (the "Lender") to the acquisition of
the Membership Interests by Purchaser and Purchaser's  resulting  acquisition of
the  membership  interests  in  Borrower.  Seller and  Purchaser  shall each pay
one-half of the application fee, the transfer fee, Lender's out-of-pocket costs,
and all other costs imposed by the Lender in connection with obtaining  Lender's
consent.

          (b) Parking  Agreement.  Seller shall have seventy-five (75) days from
the Effective Date to provide  Purchaser  with an agreement,  the terms of which
shall be  satisfactory  to  Purchaser  in its sole  discretion,  to provide  the
Company  with a parking area  containing  spaces for at least  Thirty-Five  (35)
motor vehicles at a location acceptable to Purchaser.

          (c) Estoppel  Certificates.  On the Closing Date, Seller shall provide
Purchaser with tenant estoppel certificates in accordance with the provisions of
Section 6(i) below in regards to the Leases listed on Exhibit C, attached hereto
(collectively, the "Third Party Leases").

          (d) Representations and Warranties. The representations and warranties
of Seller  contained in this Agreement  shall be true and correct on, and as of,
the Closing Date, in all material  respects as though such  representations  and
warranties were made on, and as of, such date.

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<PAGE>

          (e) Material or Adverse  Change.  Since the  Effective  Date until the
Closing Date,  there shall not have occurred any material and adverse  change in
the physical condition of the Land or the Building or any part thereof, except:

               (i) those changes caused by ordinary wear and tear; or

               (ii) as caused  directly or  indirectly by any act or omission of
Purchaser, or its agents, representatives or employees.

          (f) Company  Operations.  Since the Effective  Date, the operations of
the Company  shall have been carried out in the ordinary  course of business and
there shall not have occurred:

               (i) any material  adverse  change in the condition  (financial or
otherwise) or in the overall business of the Company,  provided,  however,  that
Seller shall have the right to withdraw any excess cash in the Company as of the
Closing Date;

               (ii) any material increase in the liabilities of the Company from
those liabilities of the Company listed or otherwise  disclosed in the Company's
most recent Financial Statements (hereinafter defined); or

               (iii) any other occurrence, event, condition or state of facts of
any kind which may materially  affect the business of the Company in any adverse
manner.

          (g) Seller's  Performance.  Seller shall have performed,  observed and
complied with all of the covenants,  agreements and conditions  outlined in this
Agreement to be  performed,  observed and complied with by Seller prior to or as
of the Closing.

          (h)  Title  to the  Property.  At or prior  to the  execution  of this
Agreement,  Seller shall provide  Purchaser with a copy of the Company's owner's
title insurance policy, and all supplements or updates thereto,  covering, inter
alia,  the Land,  accompanied  by copies of all recorded  documents  relating to
liens, encumbrances,  plats, easements, rights of way, restrictions,  covenants,
condominium  associations,  ground leases and conditions affecting the Land (the
"Permitted  Exceptions").  A list of the Permitted Exceptions is attached hereto
as Exhibit D. Within seventy-five (75) days of the Effective Date, Purchaser, at
its  expense  shall  obtain an update  of the title to the Land.  If said  title
update  reveals  exceptions  to  title  other  than  the  Permitted  Exceptions,
Purchaser shall notify Seller in writing specifying any such exceptions to which
Purchaser objects.  Upon receipt of said notice,  Seller shall,  within five (5)
days of receipt of notice from Purchaser, give Purchaser notice:

               (i) of Seller's election to cure or remove the exception,  at its
sole cost and expense; or

               (ii) of Seller's election not to cure the exception.

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<PAGE>

               (iii) Upon notice from Seller that Seller has elected not to cure
an exception,  Purchaser may (1) terminate  this  Agreement by written notice to
Seller and the  Purchase  Deposit  and  accrued  interest  shall be  refunded to
Purchaser, or (2) accept such title as Seller can deliver.

          (i) Regulatory  Approval.  Purchaser shall have received any necessary
approvals from Purchaser's state and/or federal regulatory  supervising agencies
including, but not limited to, the Maryland Commissioner of Financial Regulation
and the Federal Reserve Board.

          (j) Subdivision Approval. Seller shall provide Purchaser with evidence
of subdivision approval from the applicable  governmental zoning or other agency
authorizing the partition of the parking parcel from the 2.147 acre parcel owned
by the Company.

     4.  Representations and Warranties of Seller.  Seller hereby represents and
warrants  to  Purchaser  that the  following  are true  and  complete  as of the
Effective Date and shall be true, accurate and complete as of the Closing Date:

          (a) The Company is a limited  liability  company  duly  organized  and
validly existing under the laws of the State of Maryland pursuant to Articles of
Organization  dated June 17, 2003, a true and complete copy of which is attached
hereto as Exhibit E (the "Articles of Organization").

          (b) The  Company  operates  pursuant  to a written  Limited  Liability
Company Agreement attached hereto as Exhibit F.

          (c) Seller has the full legal  power and  authority  to enter into and
perform this Agreement in accordance with its terms.  The execution and delivery
of this  Agreement and the  performance by Seller of its  obligations  hereunder
require no further action or approval by Seller (or either of them), the Company
or any other person or entity.

          (d)  Except  with  regard to the Loan,  the  execution,  delivery  and
performance of this Agreement and all documents in connection  therewith are not
in  contravention  of or in  conflict  with  any  deed of  trust,  agreement  or
undertaking  to which Seller (or either of them),  the Company,  or any of their
respective  property  or  assets,  including  the  Property  and the  Membership
Interests, may be bound or affected.

          (e) The  Company  has filed  any and all  federal  and  state  income,
estimated income, excise,  property,  franchise, or license tax returns that the
Company at any time  heretofore  has been required by law to file,  and has paid
any and all taxes,  interest,  penalties,  or other sums shown thereby to be due
from the Company or Seller.

          (f) As of the date of this Agreement,  Seller owns one hundred percent
(100%) of the  Membership  Interests,  which  Membership  Interests were validly
issued and are fully paid and nonassessable.

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<PAGE>

          (g) There are  outstanding  no options,  warrants,  or other rights or
agreements to acquire any or all of the Membership Interests.

          (h) None of the  Membership  Interests  is the  subject  of any voting
trust  agreement  or other  agreement  relating to the  ownership  of any of the
Membership  Interests  or any of the  rights  held  by the  holder  thereof,  or
restricting in any way the sale or other transfer thereof.

          (i) There is no action, suit, litigation, or proceeding
pending against the Company, the Seller (or either of them), or any of the
Membership Interests, at law or in equity, or before or by any federal, state,
municipal, or other governmental department, commission, board, agency, or
instrumentality.

          (j)  Attached  hereto as  Exhibit G are true,  accurate  and  complete
financial statements of Canton Crossing, LLC for the period June 1, 2003 through
June 30, 2004 (the "Financial Statements").  Canton Crossing, LLC has maintained
its books of accounts in a regular and ordinary manner on a consistent basis and
the Financial  Statements  fairly  represent  the financial  condition of, inter
alia, the Company and the results of its operations as of the dates, and for the
periods, stated, in all material respects.

          (k)  Except as and only to the extent  reflected  or  reserved  in the
Financial  statements and except for obligations incurred in the ordinary course
of  business  since the date of the  Financial  Statements,  the  Company has no
material debts, liabilities or other obligations (including, without limitation,
obligations for federal, state or local taxes or other governmental  assessments
or penalties,  and  obligations  and advances,  directly or  indirectly,  to the
Company), absolute or contingent, due or to become due, and the Company does not
know or have reasonable  grounds for knowing the basis for any assertion against
the Company of any liability  (including  any tax liability) of any nature or in
any amount not reflected on or reserved in the Financial Statements. The Company
is current in the payment of all of its obligations and  liabilities,  including
those shown on the Financial Statements,  and there are no obligations due or to
become due, or liabilities,  fixed or contingent,  that the Company shall not be
able to satisfy in the ordinary course of business.

          (l) No  bankruptcy,  insolvency,  rearrangement  or similar  action or
proceeding,  whether  voluntary  or  involuntary,  is pending or, to the best of
Seller's knowledge, threatened against the Company.

          (m) The Company  owns good and  merchantable  fee simple  title to the
Property  free  and  clear  of  all  mortgages,  liens,  encumbrances,   leases,
tenancies,  commitments,  agreements, security interests, covenants, conditions,
restrictions,  rights of easements,  judgments and other matters affecting title
to the Property except for those Permitted  Exceptions (as hereinafter  defined)
set forth on  Exhibit  D, the lien of the Loan,  and the  rights of the  tenants
under the Leases.

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<PAGE>

          (n) Seller is not aware of any facts or conditions which will
result in the termination of the present access from the Property to any utility
services or to existing highways and roads.

          (o) Except as set forth on  Exhibit H attached  hereto and made a part
hereof,  there are no maintenance  or other  contracts to which the Company is a
party, affecting the Land or the Building.

          (p) Seller is not aware of any zoning,  fire, building or similar law,
ordinance or regulation that is violated by the continued maintenance, operation
or use of the Building or by the continued maintenance, operations or use of the
existing  parking  areas.  No  notice  of  violation  of any  applicable  zoning
regulation or ordinance or other law, order, ordinance, permit, rule, regulation
or  requirement,  or any  covenants,  conditions  or  restrictions  affecting or
relating to the use or  occupancy  of the Building has been given to the Company
or Seller by any governmental  agency having jurisdiction or by any other person
entitled to enforce the same.

          (q)  Subsequent  to the  Effective  Date and until the  Closing  Date,
Seller will maintain the Building in its current condition. Without limiting the
generality of the foregoing,  neither the Company nor Seller has received notice
from  any  lender  or  any  insurance  company,  insurance  rating  board,  fire
underwriting  board, or governmental  agency requiring any repairs or work to be
done to the Building or any equipment installed thereon.

          (r) Except as set forth on  Exhibit I attached  hereto and made a part
hereof,  Seller has no  knowledge  of any claim,  litigation  or  proceeding  or
governmental  investigation,  pending or  threatened,  against or affecting  the
Building or any portion  thereof or with respect to the Leases or relating to or
arising  out of the  ownership  of the  Land,  in any  court or before or by any
Federal or Maryland  department,  commission,  board,  bureau or agency or other
governmental  instrumentality.  Seller shall give Purchaser  immediate notice of
any such claim,  litigation,  proceeding or investigation which becomes known to
it prior to the date of the Closing.

          (s) Each of the two (2) entities  comprising  the Seller is a Maryland
limited liability  company,  in good standing,  with full power and authority to
execute and deliver this  Agreement  and all of the closing  documents  required
hereunder  ("Seller's  Documents")  and to perform  all  obligations  under this
Agreement  and  Seller's  Documents.  This  Agreement  constitutes,  and each of
Seller's  Documents will constitute,  the legal, valid and binding obligation of
Seller,  enforceable in accordance with their  respective  terms,  covenants and
conditions.

          (t) All water, sewer, gas (if any), electric,  telephone, drainage and
other utility equipment,  facilities and services necessary for the operation of
the Building as it is now being operated are installed and connected pursuant to
valid permits.

          (u) All storm water  flowing from the Land drains either into a public
system or onto a permitted location and through easements.

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<PAGE>

          (v) The elevators,  HVAC systems and other mechanical  systems located
in, or serving, the Building are located on the Land, are presently owned by the
Company, and shall be owned by the Company at the time of the Closing,  free and
clear of all liens, encumbrances, security interests and adverse claims.

          (w) The Leases  attached  hereto as  Exhibit B are the only  leases or
other  agreements  permitting  the use or  possession  of space on or about  the
Property  in effect  on the date  hereof.  There  are no other  rights of use or
possession,  options,  agreements of sale or any other right, title or interests
in or to any part or all of the Property except as set forth in the Leases.

          (x) No  additional  leases or rights will be executed or given for any
portion or portions of the Building,  nor will the existing  Leases be extended,
canceled,  modified,  added to or amended in any respect,  or any  assignment or
subletting  approved for the Lease,  without,  in each  instance,  obtaining the
prior written approval of Purchaser.

          (y) No controversy, complaint, proceeding, suit or litigation relating
to any Lease, tenancy or rent of the Building or any party thereof is pending in
any court, or administrative agency, or before any arbitrator.

          (z) The Property shall be conveyed free and clear of any  obligations,
other than the lien of the Loan, upon Purchaser's assumption of the Loan, to any
person,  firm,  partnership  or  corporation  in connection  with the management
thereof  or with  the  procurement  of  leases  thereon  and  there  shall be no
brokerage or leasing fees or commissions or other compensation due or payable on
an  absolute  or  contingent  basis to any person,  firm,  corporation  or other
entity,  with  respect  to or on  account  of  the  Leases  and  no  such  fees,
commissions or other  compensation  shall, by reason of any existing  agreement,
become  due during  the terms of the  Leases or with  respect to any  renewal or
extension thereof or the leasing of additional space by a tenant.

          (aa) Except as set forth on Exhibit J attached  hereto and made a part
hereof, there are no pending or proposed special assessments  affecting or which
may affect the Property or any part thereof.

          (bb) There are no commitments  made by the Company to any governmental
or quasi-governmental  authority having jurisdiction,  or to any third party, to
dedicate or grant any portion of the Property for easements,  rights-of-way,  or
other public  purposes,  or to subject the Property to any  restrictions,  or to
incur any other expense or obligation relating to the Property.

          (cc) There are no penalties due with respect to real estate taxes, and
all real estate  taxes  (excepting  those for the current tax year which are not
yet overdue,  i.e., which are still payable without  interest or penalty),  have
been paid in full.

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<PAGE>

          (dd) Environmental Matters.

               (i)  Except  as   expressly   disclosed   in  (1)  that   certain
Environmental  Report entitled Phase I Environmental Site Assessment,  dated May
12, 2003 and  prepared by National  Assessment  Corporation,  a copy of which is
attached  hereto  as  Exhibit  K  (the  "Environmental  Report"),  (2)  Seller's
Environmental  Exhibit dated  September 10, 2004,  attached  hereto as Exhibit L
(the "Seller's  Environmental  Exhibit"),  and (3) the letter dated September 7,
2001,  issued by the Maryland  Department of the  Environment  (the "Site Status
Letter")  attached  hereto as Exhibit M: (a) to the best of Seller's  knowledge,
the Property has not at any time been in violation  of, or otherwise  exposed to
any liability  under, any state or federal law, rule or regulation or common law
duty  pertaining  to  human  health,   natural   resources  or  the  environment
(collectively,  "Environmental  Laws");  (b) the  Property is not subject to any
private or governmental lien arising under  Environmental  Laws; (c) there is no
pending,  nor,  to  Seller's  knowledge,  threatened  litigation  arising  under
Environmental  Laws affecting Seller or the Property;  and (d) there has been no
claim by any  party  that a use or  condition  of the  Property  has  caused  an
environmental hazard condition on any other property.

               (ii)  Neither  the Company  nor Seller has  utilized  the Land or
Building (1) as a land fill to receive garbage,  refuse or waste, whether or not
hazardous, or (2) for the storage, deposit, disposal,  treatment or recycling of
any toxic, dangerous or Hazardous Materials. Except as disclosed in the Seller's
Environmental  Exhibit and the Site Status Letter,  the Land and Building do not
contain any  Hazardous  Materials  nor has there been a release of any Hazardous
Materials  on or from the Land or  Building.  For  purposes  of this  Agreement,
"Hazardous   Materials"  means  and  includes  petroleum,   petroleum  products,
flammable explosives, radioactive materials, asbestos or any material containing
asbestos, polychlorinated biphenyls or urea formaldehyde.

               (iii) Except as disclosed in the Seller's  Environmental  Exhibit
and the Site Status  Letter,  neither the  Company nor Seller has  received  any
notice from any governmental  agency,  entity or person with regard to Hazardous
Materials on, from or affecting the Land or Building.

               (iv) Through and  including  the Closing  Date:  (1) the Property
shall be kept free of all Hazardous Materials; (2) Seller shall immediately give
Purchaser  oral and  written  notice in the  event  that the  Company  or Seller
receives any notice from any  governmental  agency,  entity,  or any other party
with regard to Hazardous Materials on, from or affecting the Property.

               (v) Seller hereby  agrees to indemnify,  defend and hold harmless
Purchaser  from  and  against  any  and all  liens,  demands,  defenses,  suits,
proceedings,   disbursements,   liabilities,   losses,  litigation,   judgments,
obligations,   penalties,   injuries,   costs,   expenses  (including,   without
limitation,  attorneys'  and  experts'  fees) and  claims of any and every  kind
whatsoever paid,  incurred,  suffered by, or asserted against,  Purchaser and/or
the Land or the Building including loss of value and out-of-pocket expenses for,
with  respect  to,  or as a  direct  or  indirect  result  of  any  warranty  or
representation  made by Seller in this Section being false, untrue or misleading
in any respect.

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<PAGE>

               (vi) Purchaser  understands and agrees that, upon purchase of the
Membership Interests, the Company will continue to be responsible for compliance
with the provisions of the Site Status Letter as to all monitoring wells located
on the property.

     If any representation or warranty contained in this Agreement should become
materially  untrue or incorrect  after the Effective Date and before the Closing
Date, Seller shall immediately  notify Purchaser of such condition and Purchaser
may: (i) waive such  condition  and close;  or (ii)  terminate  this  Agreement,
whereupon the Purchase Deposit,  and all accrued interest,  shall be refunded to
Purchaser  and no  party  thereto  shall  have any  further  rights,  claims  or
liabilities  hereunder  except as  expressly  provided  for by the terms of this
Agreement.

     Seller shall certify in the Assignment of Membership Interests executed and
delivered at Closing that all of the representations and warranties contained in
this Section 4 are true and correct as of the Closing Date,  except as to facts,
if any, set forth in said Assignment.

     5.  Covenants.  During the term of this  Agreement,  Seller  covenants  and
agrees as follows:

          (a) Without prior written approval of Purchaser, Seller shall not:

               (i) make,  permit  or cause the  Company  to make,  or  otherwise
permit  to be  made,  any  changes  or  alterations  to or upon  any part of the
Property;

               (ii) enter into,  extend,  modify or terminate or permit or cause
the Company to enter into, extend, modify or terminate any of the Leases;

               (iii) assign,  transfer,  convey,  hypothecate,  pledge, create a
security  interest  in or  lien,  mortgage  deed of  trust,  easement  or  other
encumbrance  upon any part of the Membership  Interests,  or permit or cause the
Company to assign,  transfer,  convey,  hypothecate,  pledge,  create a security
interest in or lien, mortgage, deed of trust, easement or other encumbrance upon
any part of the Property or any interest therein; or

               (iv) apply for or consent  to, or cause the  Company to apply for
or  consent  to,  any  zoning,  rezoning,  special  exception,  subdivision,  or
condemnation  of the  Property,  except that the  Company  may proceed  with any
activities  relating to the foregoing commenced as of the date of this Agreement
with the written  consent of Purchaser,  which consent shall not be unreasonably
delayed or withheld.

          (b) Seller shall continue to maintain the Property,  or cause the same
to be maintained, in its present order and condition (ordinary wear and tear and
damage by casualty excepted) until the Closing Date.

                                       10
<PAGE>

          (c) Seller shall  continue to operate and manage the  Company,  and to
cause the same to be operated  and managed,  in the ordinary  course of business
and in such  manner  as to  maintain  the  Building  in its  present  order  and
condition.

          (d) Seller shall continue to maintain, or cause to be maintained,  all
of the insurance  policies relating to the Company or the Property,  or any part
thereof, in full force and effect until the Closing date.

          (e)  Seller  shall  maintain,  or cause to be  maintained,  all of the
Company's  permits and licenses  and Leases in full force and effect,  and shall
file  timely,  or cause to be filed  timely,  all reports,  statements,  renewal
applications  and  other  filings,  and shall  pay  timely,  or cause to be paid
timely,  all fees and charges in connection  therewith that are required to keep
the Company's permits and licenses and Leases in full force and effect.

          (f) Seller  shall pay,  or cause to be paid,  all taxes,  assessments,
governmental  charges or levies (including  interest and penalties) imposed upon
the Property,  the Membership  Interests or the Company as and when such are due
and  payable,  and shall pay,  or cause to be paid,  all other  liabilities  and
charges which are due and payable and which,  if unpaid,  might become a lien or
charge upon the Property,  the Membership  Interests or any of the assets of the
Company.

          (g) Seller shall not dispose of the  Property,  or permit or cause the
Company to dispose of the Property.

          (h) Seller  shall  provide  Purchaser  with true copies of all notices
concerning the Property or the Company  received by Seller or the Company within
ten (10) days after  receipt.  If Seller or the  Company  receives  any  notices
concerning  the Property or the Company  after  Closing,  Seller  shall  provide
Purchaser promptly with true copies thereof.

     6.  Deliveries at Closing.  On the Closing Date,  unless  otherwise  noted,
Seller shall deliver to Escrow Agent the following executed documents:

          (a) An assignment of Membership  Interests in the form attached hereto
as Exhibit N (the "Assignment of Membership Interests").

          (b) A  financial  statement  for the  Company  which shall be accurate
through the Closing Date.

          (c) If required as a matter of law,  an  affidavit,  signed by Seller,
stating under penalty of perjury, Seller's United States taxpayer identification
numbers and stating that neither of the two (2) entities comprising Seller is:

               (i) a foreign  person as defined by the  United  States  Internal
Revenue Code of 1986, as amended (the "Code"), Section 1445(f)(3); or

                                       11
<PAGE>

               (ii) a non-resident payee under the laws of the State of Maryland
(the "FIRPTA Affidavit");

          (d) If required as a matter of law, an  affidavit  and Form 1099S from
Seller containing all information required for compliance with Code Section 6405
in the form  required by the  Internal  Revenue  Service  for filing  thereunder
signed by Seller (the "Form 1099S");

          (e)  If  required  by  the  company  issuing  title  insurance  on the
Property,  an affidavit of Seller, for the purposes of deleting from Purchaser's
title policy, the standard exceptions of such title insurance company for claims
of  parties-in-possession,  including  but not  limited to,  claims  relating to
unrecorded  leases and  mechanic's  liens  arising  from work  performed  at the
request of a party other than  Purchaser,  all as they  pertain to the  Property
(the "Owner's Affidavit");

          (f) Such other documents as may reasonably be required by Purchaser or
Escrow  Agent  or  required  by  Maryland  law  to  consummate  the  transaction
contemplated herein;

          (g) An affidavit  reaffirming Seller's  representations and warranties
set forth herein or identifying those  representations  and warranties which are
no longer true and correct.

          (h)  Original  executed  copies  of the  Third  Party  Leases  and any
amendments  thereto (if any original is not  available,  Seller shall  provide a
clear photostatic copy of such Lease  accompanied by a representation  that said
copy is a true,  accurate and complete copy of the original Lease) together with
the complete tenant file for each tenant;

          (i) A tenant estoppel  certificate  (dated no earlier than thirty (30)
days prior to the Closing Date) from each tenant under the Third Party Leases in
the form attached hereto as Exhibit O;

          (j)  Notice to the  tenants  executed  by the  Company  informing  the
tenants  under the Third  Party  Leases of the change of address to which  rents
should be sent; and

          (k) An indemnification  agreement from Seller to Purchaser in the form
attached  hereto  as  Exhibit  P,  providing  for  indemnification  against  all
operating  expenses or other  liabilities of the Company allocable to any period
prior to the Closing Date.

     7. Closing  Adjustments.  All income and expenses  relating to the Property
including,  but not limited to, taxes,  water,  rents, and all utility and other
operating expenses of the Building,  except as otherwise provided herein, are to
be adjusted to the Closing Date.

     8. Tax Returns.  Seller shall,  at its expense and as soon as is reasonably
possible  after  the  Closing  Date  and in any  event  within  such  time as is
permitted by the  provisions of the Code, or other  applicable  law, cause to be
prepared and filed the federal and state  interim,  final or  estimated  income,
excise,  property,  franchise or license tax returns for the  Company's  taxable
year for the period ending on the Closing Date and, in such return, Seller shall
make an election  under Code  Section 754.  Seller shall  provide to Purchaser a
copy of any such return within fifteen (15) days of the filing of the return. If
any such return  indicates  that Seller has incurred any  liability for any such
tax,  Seller  shall cause such tax to be paid to the  assessing  authority on or
before the last date on which payment thereof is due without penalty.

                                       12
<PAGE>

     9. Audits. If at any time after the Closing Date the Company's or
Seller's federal or state interim, final, or estimated income, excise, property,
franchise, or license tax returns for any taxable year beginning before the
Closing Date are audited by the Internal Revenue Service, the Comptroller of the
Treasury of Maryland, or any other governmental body, or if any other inquiry is
made as to the same, Seller shall, at its expense and in a timely fashion, take
any and all actions reasonably necessary to respond to the same and to resolve
any issues presented thereby, and shall pay any and all taxes, penalties,
interest, or other charges that may be assessed or shown to be due as a result
thereof.

     10. Intentionally Omitted.

     11. Indemnity.

          (a) Seller  agrees to indemnify,  defend and hold  harmless  Purchaser
from and  against,  and shall  reimburse  Purchaser  with respect to any and all
claims,  demands,  causes of action,  losses,  damages,  liabilities,  costs and
expenses (including  reasonable attorneys' fees and court costs, whether suit is
instituted or not), asserted against or actually incurred by Purchaser by reason
of or arising out of:

               (i) the  discovery  following  the Closing  Date of the breach or
material  misstatement by Seller of any  representation or warranty contained in
this Agreement; or

               (ii) the  existence  of any  material  liability  of the  Company
existing  as of the  Closing  Date,  or prior  thereto,  that is not  listed  or
otherwise disclosed in writing to, and assumed in writing by Purchaser; or

               (iii) the  operation  or ownership of the Company or the Property
on or before the Closing Date.

          (b) Purchaser agrees to indemnify, defend and hold harmless the Seller
from and against, and shall reimburse Seller with respect to any and all claims,
damages,  causes of action,  losses,  damages,  liabilities,  costs and expenses
(including   reasonable  attorneys'  fees  and  court  costs,  whether  suit  is
instituted or not), asserted against or actually incurred by Seller by reason of
or arising out of:

               (i) any  liabilities  or expenses of Seller  incurred or accruing
after the Closing Date; or

               (ii) the  operation  or  ownership of the Company or the Property
after the Closing Date.

                                       13
<PAGE>

     12. Remedies.

          (a) Seller's Default.  In the event Purchaser shall be ready,  willing
and able to settle on the purchase of the Membership  Interests  pursuant to the
terms of this Agreement,  and Seller shall fail to sell, transfer and assign the
Membership  Interests  to  Purchaser  for any reason  and/or  perform  any other
obligation of Seller hereunder, Purchaser shall be entitled to its choice of the
following remedies:

               (i) Purchaser may enforce specific performance of this Agreement;
or

               (ii) Purchaser may declare this Agreement to be null and void and
demand  return  of  the  Purchase   Deposit  and  all  accrued   interest,   and
reimbursement of any  out-of-pocket  costs and expenses  reasonably  incurred or
paid by  Purchaser  pursuant  to the terms of this  Agreement  or to satisfy any
condition or requirement for the Closing,  and upon the return and reimbursement
of  same,  the  parties  hereto  shall  be  relieved  of any  further  liability
hereunder.

          (b)  Purchaser's  Default.  In the event that Purchaser  shall fail to
consummate  this  Agreement  for any reason,  except upon a default of Seller or
termination  of this  Agreement  by Seller or  Purchaser  pursuant  to the terms
and/or  provisions  hereof,  Seller  shall be entitled  to receive the  Purchase
Deposit,  with any accrued interest,  as full and agreed upon liquidated damages
and each of the parties shall be released from any further liability hereunder.

     13.  Destruction  or Damage Prior to the Closing  Date.  Except as provided
herein, Seller and the Company assume all risk of loss or damage to the Building
by fire or other casualty until the Closing. Seller agrees to maintain, or cause
the Company to maintain,  at its sole cost and expense all insurance  (including
fire and extended  coverage and public liability  insurance)  currently in force
covering  the  Building  until  the  Closing.  If at any time on or prior to the
Closing  Date any portion of the Building is destroyed or damaged as a result of
fire or any other cause whatsoever, Seller shall promptly give notice thereof to
Purchaser. In the event of such destruction or damage,  Purchaser shall have the
right to terminate  this  Agreement by written  notice to Seller within ten (10)
days  following the date upon which  Purchaser  receives  written  notice of the
extent and estimated cost of such destruction or damage from Seller,  along with
a good faith estimate of the amount of insurance  proceeds it expects to recover
with respect thereto. If Purchaser does not elect to so terminate this Agreement
within said ten (10) day period,  this Agreement  shall remain in full force and
effect and Seller shall assign,  or cause the Company to assign, to Purchaser at
the Closing any and all proceeds of the claims under any then existing insurance
policies.

     14. Condemnation.  In the event, at any time prior to the Closing Date, any
action or  proceeding  is filed or notice of any  pending  action is received by
Seller or the Company,  under which the Property, or any portion thereof, may be
taken  pursuant to any law,  ordinance or regulation or by  condemnation  or the
right of eminent domain,  Seller shall promptly give notice thereof to Purchaser
and Purchaser shall have the right to terminate this Agreement by written notice
to Seller. If Purchaser does not elect to so terminate this Agreement,  it shall
remain in full force and effect and Seller shall assign, or cause the Company to
assign,  to Purchaser at the Closing all of Seller's,  or the Company's,  right,
title and interest in and to any  proceeds  received or which may be received by
reason of such taking, or a sale in lieu thereof.

                                       14
<PAGE>

     15.  Disposition of Deposit.  The entire Purchase  Deposit shall be held by
Escrow Agent and deposited in interest  bearing  account(s)  in accordance  with
this Agreement until the Closing,  or until disposition thereof is made pursuant
to the terms of this  Agreement.  Escrow  Agent shall have the right to disburse
the  Purchase  Deposit to  Purchaser  or Seller  (and the  interest  earned with
respect to each amount  escrowed) as follows:  (a) at the Closing,  the Purchase
Deposit,  and any accrued  interest with respect thereto shall be disbursed with
and credited toward the Purchase Price and/or (b) otherwise, as provided in this
Agreement  upon ten (10) days written notice to the parties;  provided  however,
that  Escrow  Agent  shall not have  received  any  written  objections  to such
disbursements within ten (10) days after receipt by Purchaser and Seller of said
notice.  The parties hereto hereby  acknowledge  that Escrow Agent shall have no
liability  to any party on account of Escrow  Agent's  failure to  disburse  the
Purchase  Deposit  (or  interest  thereon)  if a dispute  shall have arisen with
respect to the propriety of such disbursement;  and, in the event of any dispute
as to who is entitled  to receive the  amount(s)  escrowed,  or interest  earned
thereon,  Escrow Agent shall deposit such funds with the Baltimore  City Circuit
Court pending a final decision of such  controversy.  The parties hereto further
agree that Escrow  Agent shall not be liable for failure of any  depository  and
shall not be otherwise  liable except in the event of Escrow Agent's  negligence
or willful misconduct.

     16. Condition of the Property; Local Violations. Subject to the terms
and conditions hereof, Purchaser is acquiring the Property in its "as is"
condition as of the Effective Date. All written notices of violations of
statutes, municipal orders or regulations issued by any department of the
jurisdiction in which the Property is situated, or prosecutions in any of the
Courts of the jurisdiction in which the Property is situated on account thereof,
against or affecting the Land or the Building that have been received by Seller,
or the Company, shall be complied with by Seller, or the Company.
Notwithstanding the foregoing, Seller and the Company shall: (a) deliver the
Property in substantially the same physical condition as on the Effective Date;
(b) not defer normal maintenance of the Building during the period from the
Effective Date to the date of the Closing; and (c) not enter into, modify or
terminate the Leases or any maintenance or service contracts relating to the
Property, if any, prior to the Closing Date without the prior written consent of
Purchaser which consent shall not be unreasonably withheld or denied. As of the
Closing Date, Seller and the Company will leave the electrical, plumbing,
heating and air conditioning and any other mechanical systems and equipment in
the same condition as at the Effective Date.

     17.  Choice of Law.  This  Agreement,  the  rights and  obligations  of the
parties hereto, and any claims or disputes relating thereto shall be governed by
and construed in accordance with the laws of the State of Maryland.

     18. Time is of the Essence.  Purchaser and Seller agree that time is of the
essence as to this Agreement.

                                       15
<PAGE>

     19.  Binding  Effect;  Entire  Agreement;  Amendment.  Purchaser and Seller
mutually  agree  that this  Agreement  shall be  binding  upon  them,  and their
respective heirs, executors,  administrators,  successors and assigns; that this
Agreement  contains the final and entire  Agreement  between the parties hereto,
and  that  they  shall  not be  bound  by  any  terms,  conditions,  statements,
warranties,  or  representations,  oral or  written,  express  or  implied,  not
expressly  contained herein. The language of the Agreement shall in all cases be
construed  as a whole and  according to its fair meaning and not strictly for or
against any party  hereto,  whether or not all or any portion of this  Agreement
was  drafted  by or on behalf of any party  hereto.  This  Agreement  may not be
amended except by a written instrument signed by all parties.

     20.  Pronouns.  The words "Seller,"  "Purchaser,"  and all pronouns and any
variations thereof shall be deemed to refer to the masculine,  feminine, neuter,
singular or plural,  as the identity of the person or entity and the context may
require.

     21. Notice.  All notices  required or permitted  herein shall be in writing
and effective as of the date on which such notice is mailed in any United States
Post Office, by certified or registered mail, postage prepaid, or hand-delivered
by commercial  courier  service,  to Seller,  Purchaser  and/or Escrow Agent (as
shall be  applicable)  at the  addresses  designated  herein,  or to such  other
address as the parties may designate in writing from time to time.

         If to Purchaser:                   First Mariner Bancorp
                                            3301 Boston Street
                                            Baltimore, Maryland 21224

         If to Seller:                      Canton Crossing, LLC
                                            Hale Canton, LLC
                                            3301 Boston Street
                                            Baltimore, Maryland 21224

         If to Escrow Agent:                Kenilworth Title Company, LLC
                                            3301 Boston Street
                                            Baltimore, Maryland 21224

     22. Brokerage.  Seller and Purchaser represent to each other that no broker
or person is  entitled  to any  commission  by  reason  of the  negotiation  and
execution  of this  Agreement.  Seller  and  Purchaser  agree to hold each other
harmless  against  any and all claims by any person  for  brokerage  commissions
arising out of any  conversation,  negotiations  or other  dealings  held by the
other party with any broker regarding this Agreement.

     23. Tax Free  Exchange.  Purchaser  agrees to cooperate  with Seller in its
implementation  of a tax free exchange  pursuant to Section 1031 of the Internal
Revenue Code, provided,  however, Purchaser shall bear no additional expenses in
connection with providing such cooperation.

                                       16
<PAGE>

     24. Survival.  The respective  rights and obligations of the parties hereto
under the provisions of this Agreement shall survive Closing.

     IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the
date and year first above-written.

WITNESS:                              SELLER:

                                      CANTON CROSSING, LLC
                                      a Maryland limited liability company

                                       /s//Edwin F. Hale, Sr.
----------------------------      By:  ____________________________________
                                       Edwin F. Hale, Sr., Member

WITNESS:                              HALE CANTON, LLC
                                      a Maryland limited liability company

                                       /s/Edwin F. Hale, Sr.
----------------------------      By:  ____________________________________
                                       Edwin F. Hale, Sr., Member

WITNESS:                               PURCHASER:

                                       FIRST MARINER BANCORP
                                       a Maryland corporation

                                       /s/Joseph A. Cicero
----------------------------      By:  ______________________________
                                       Joseph A. Cicero
                                       President & Chief Operating Officer

                                       17Market Share Recovery, Inc.

                            ASSET PURCHASE AGREEMENT

      This Asset Purchase Agreement ("Agreement") is entered into effective as
of October 7th, 2004 by and among Market Share Recovery, Inc. a Delaware
corporation (the "Company"), and Palomar Enterprises, Inc., a Nevada corporation
(the "Seller").

                                    RECITALS

      A. The Company has authorized capital stock consisting of 50,000,000
shares of common stock, $0.10 par value ("Common Stock"), of which 45,702,256
shares are issued and outstanding, 10,000,000 shares of Preferred Stock, $0.01
par value ("Preferred Stock"), none of which are issued and outstanding.

      B. The Seller wishes to sell, and the Company wishes to purchase, certain
assets of the Seller on the Closing Date (as defined below), in exchange for
646,117 shares of the Company's Common Stock (the "Common Shares") and 1,000,000
shares of the Company's Series A Preferred Stock (as defined in Section 1.2
below) (the "Preferred Shares"), subject to and upon the terms hereinafter set
forth.

      C. Concurrently herewith, the Seller and certain owners of shares of
Common Stock of the Company have entered into a certain Capital Stock Purchase
Agreement with regard to the Seller's purchase of 29,000,000 shares of Common
Stock of the Company (the "Stock Purchase Agreement").

                                    AGREEMENT

      It is agreed as follows:

      1. ASSET PURCHASE AND PLAN OF REORGANIZATION.

            1.1 Purchase and Sale of Assets. Subject to the terms and upon the
conditions set forth herein, at the Closing, the Seller shall sell, assign,
transfer and deliver to the Company, the following assets (the "Assets"):

                  1.1.1 $150,000 in cash;

                  1.1.2 all current automotive notes and contracts, as set forth
on Schedule 1.1.2 attached hereto;

                  1.1.3 a business plan and model for automotive financial
services (the "Business Plan"); and

                  1.1.4 a database of potential customers of the business set
forth in the Business Plan.

<PAGE>
            1.2 Authorization of Series A Preferred Stock. The Company shall
authorize the number of shares of Series A Convertible Preferred Stock, $.01 par
value per share (the "Series A Preferred Stock"), as provided herein, which
shall be entitled to the preferences, rights and benefits set forth in the
capital stock provisions of the Company's Certificate of Designation, to be
filed on or before the Closing in the form set forth in Exhibit A attached
hereto (the "Certificate of Designation"). The Series A Preferred Stock shall be
convertible into shares of the Company's Common Stock as set forth in the
Certificate of Designation. After the Closing, the Company shall authorize and
reserve a sufficient number of its previously authorized but unissued shares of
Common Stock to satisfy the rights of conversion and purchase of the holders of
the Series A Preferred Stock. Any shares of Common Stock issuable upon
conversion of the Series A Preferred Stock, when issued, shall be referred to as
"Conversion Shares."

            1.3 Purchase Price. In exchange for the sale, assignment, transfer
and deliver of the Assets to the Company, at the Closing, the Company shall
issue and sell to the Seller the Common Shares and the Preferred Shares
(collectively, the "Shares").

      2. CLOSING(S).

            2.1 Date and Time. Subject to all of the terms and conditions set
forth in this Agreement being satisfied, the closing of the sale of the Assets
and the sale and issuance of the Shares contemplated by this Agreement (the
"Closing") shall take place as agreed to by the parties but not later than
October 31, 2004 at the offices of the Company's counsel, Sommer & Schneider,
LLP, 595 Stewart Avenue, Suite 70, Garden City, New York 11530, or at such other
place as the Seller and the Company shall agree in writing concurrently with the
execution of this Agreement (the "Closing Date").

            2.2 Seller Deliveries. At the Closing, the Seller will deliver the
following to the Company:

                  2.2.1 A check or wire transfer in the amount of $150,000.

                  2.2.2 A Bill of Sale in the form attached hereto as Exhibit B.

            2.3 Deliveries. At the Closing, the Company will deliver the
following to the Seller:

                  2.3.1 The certificates representing the Shares, duly
registered in the name of the Seller, against delivery to the Company by the
Seller of the items set forth in Section 2.2 above.

                  2.3.2 The complete original articles of incorporation, bylaws,
minutes, and other corporate books and records, all as amended to date, of the
Company.

                  2.3.3 A certified list of stockholders from the transfer agent
of the Company, dated no earlier than two (2) business days prior to the date of
Closing.

                  2.3.4 All accounting books and records for the Company for the
period commencing January 1, 2001 through the present.

<PAGE>
                  2.3.5 A list of all SEC and EDGAR codes for the Company.

                  2.3.6 Resolutions of the board of directors appointing Steven
Bonenberger and Brent Fouch as directors of the Company, to become effective at
the Closing.

                  2.3.7 Resignations of all directors of the Company.

                  2.3.8 Resignations of all officers of the Company.

                  2.3.9 A letter of instruction to the transfer agent of the
Company signed by Raymond Barton in his capacity as Chief Executive Officer of
the Company advising the transfer agent of the change of officers and directors
contemplated by this Agreement.

                  2.3.10 A letter to the Company's current certifying
accountants signed by Raymond Barton in his capacity as Chief Executive Officer
of the Company advising the certifying accountants of the change of officers and
directors contemplated by this Agreement.

                  2.3.11 Evidence satisfactory to the Seller or its counsel that
all liabilities of the Company, other than those to which the Seller has agreed,
have been satisfied, compromised, or otherwise extinguished.

                  2.3.12 A certification and indemnity and release agreement,
signed by each officer and director of the Company, in a form and substance
reasonably acceptable to the Seller, dated as of the date hereof, certifying
that all representations and warranties of the Company made herein are true and
correct.

                  2.3.13 Certified resolutions or a duly executed unanimous
written consent of the Board of Directors of the Company authorizing the
consummation of the transactions contemplated by this Agreement.

                  2.3.14 A certificate of good standing of the Company from the
State of Delaware as of the most recent practicable date.

      3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

      As a material inducement to the Seller to enter into this Agreement and to
acquire the Shares, the Company represents and warrants that the following
statements are true and correct in all material respects, except as expressly
qualified or modified herein.

            3.1 Organization and Good Standing. The Company is a corporation
duly organized, validly existing, and in good standing under the laws of the
State of Delaware and has full corporate power and authority to enter into and
perform its obligations under this Agreement, and to own its properties and to
carry on its business as presently conducted and as proposed to be conducted.
The Company is duly qualified to do business as a foreign corporation in every
jurisdiction in which the failure to so qualify would have a material adverse
effect upon the Company.

<PAGE>
            3.2 Capitalization. The Company is authorized to issue 50,000,000
shares of Common Stock, of which 45,702,256 shares are issued and outstanding
and 10,000,000 shares of undesignated Preferred Stock, none of which are issued
and outstanding. All outstanding shares of Common Stock and Preferred Stock are
duly authorized, validly issued, are fully paid, nonassessable, and free of any
preemptive rights. There are no outstanding options, warrants, rights,
subscriptions, calls, contracts or other agreements to issue, purchase or
acquire, or securities convertible into, shares of capital stock or other
securities of any kind representing an ownership interest in the Company and no
person is a party to any proxy, voting trust or other agreement with respect to
the voting of the Company's Common Stock. There are no outstanding contractual
obligations of the Company to repurchase, redeem or otherwise acquire any shares
of Common Stock of the Company.

            3.3 Validity of Transactions. This Agreement, and each document
executed and delivered by the Company in connection with the transactions
contemplated by this Agreement, have been duly authorized, executed and
delivered by the Company and is each the valid and legally binding obligation of
the Company, enforceable in accordance with its terms, except as limited by
applicable bankruptcy, insolvency reorganization and moratorium laws and other
laws affecting enforcement of creditor's rights generally and by general
principles of equity.

            3.4 Valid Issuance of Shares. The Shares that are being sold to the
Seller hereunder are duly and validly issued, fully paid and nonassessable and
free of restrictions on transfer, other than restrictions on transfer under this
Agreement and under applicable federal and state securities laws, and will be
free of all other liens and adverse claims.

            3.5 No Violation. The execution, delivery and performance of this
Agreement will not violate any law or any order of any court or government
agency applicable to the Company, as the case may be, or the Articles of
Incorporation or Bylaws of the Company, and will not result in any breach of or
default under, or, except as expressly provided herein, result in the creation
of any encumbrance upon any of the assets of the Company pursuant to the terms
of any agreement or instrument by which the Company or any of its assets may be
bound. No approval of or filing with any governmental authority is required for
the Company to enter into, execute or perform this Agreement.

            3.6 SEC Reports and Financial Statements.

                  3.6.1 The Company has delivered or made available to the
Seller accurate and complete copies (excluding copies of exhibits) of each
report, registration statement and definitive proxy statement filed by the
Company with the United States Securities and Exchange Commission ("SEC") since
January 1, 2001 (collectively, with all information incorporated by reference
therein or deemed to be incorporated by reference therein, the "SEC Reports").
All statements, reports, schedules, forms and other documents required to have
been filed by the Company with the SEC have been so filed on a timely basis,
except as indicated in such SEC Reports. As of the time it was filed with the
SEC (or, if amended or superseded by a filing prior to the date of this
Agreement, then on the date of such filing): (i) each of the SEC Reports
complied in all material respects with the applicable requirements of the
Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as
amended; and (ii) none of the SEC Reports contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

<PAGE>
                  3.6.2 Except for the pro forma financial statements, the
consolidated financial statements contained in the SEC Reports: (i) complied as
to form in all material respects with the published rules and regulations of the
SEC applicable thereto; (ii) were prepared in accordance with GAAP applied on a
consistent basis throughout the periods covered (except as may be indicated in
the notes to such financial statements and, in the case of unaudited statements,
as permitted by Form 10-QSB of the SEC, and except that unaudited financial
statements may not contain footnotes and are subject to normal and recurring
year-end audit adjustments which will not, individually or in the aggregate, be
material in amount); and (iii) fairly present, in all material respects, the
consolidated financial position of the Company and its consolidated subsidiaries
as of the respective dates thereof and the consolidated results of operations of
the Company and its consolidated subsidiaries for the periods covered thereby.
All adjustments considered necessary for a fair presentation of the financial
statements have been included.

            3.7 Subsidiaries. Except as set forth in the SEC Reports, the
Company does not own, directly or indirectly, any equity or debt securities of
any corporation, partnership, or other entity (a "Subsidiary").

            3.8 Litigation. Except as set forth in the SEC Reports, there are no
suits or proceedings (including without limitation, proceedings by or before any
arbitrator, government commission, board, bureau or other administrative agency)
pending or, to the knowledge of the Company, threatened against or affecting the
Company or any of its subsidiaries which, if adversely determined, would have a
material adverse effect on the consolidated financial condition, results of
operations, prospects or business of the Company, and neither the Company nor
any of its subsidiaries are subject to or in default with respect to any order,
writ, injunction or decree of any federal, state, local or other governmental
department.

            3.9 Taxes. Federal income tax returns and state and local income tax
returns for the Company and its subsidiaries have been filed as required by law;
all taxes as shown on such returns or on any assessment received subsequent to
the filing of such returns have been paid, and there are no pending assessments
or adjustments or any income tax payable for which reserves, which are
reasonably believed by the Company to be adequate for the payment of any
additional taxes that may come due, have not been established. All other taxes
imposed on the Company and its Subsidiaries have been paid and any reports or
returns due in connection herewith have been filed.

<PAGE>
            3.10 Securities Law Compliance. Assuming the accuracy of the
representations and warranties of the Seller set forth in Section 4 of this
Agreement, the offer, sale and delivery of the Shares will constitute an
exempted transaction under the Securities Act of 1933, as amended and now in
effect ("Securities Act"), and registration of the Shares under the Securities
Act is not required. The Company shall make such filings as may be necessary to
comply with the Federal securities laws and the blue sky laws of any state,
which filings will be made in a timely manner.

            3.11 Liabilities. Except as set forth on Schedule 3.11, the Company
has no liabilities, contingent or otherwise. The Company maintains and will
continue to maintain a standard system of accounting established and
administered in accordance with generally accepted accounting principles. The
Company shall use the cash portion of the Assets from the transactions
contemplated hereby solely to pay the liabilities set forth on Schedule 3.11,
which payments shall be made within two (2) business days of the Closing Date,
and, upon such payments, the Company will have no liabilities, contingent or
otherwise, except those to which the Seller has agreed in writing.

            3.12 Qualifications, Legal and Investment. All authorizations,
approvals, or permits, if any, of any governmental authority or regulatory body
of the United States including "blue sky" filings in any state that are required
in connection with the lawful sale of the Shares pursuant to this Agreement have
been or will be, on a timely basis, duly obtained and are effective. No stop
order or other order enjoining the sale of the Shares have been issued and no
proceedings for such purpose are pending or, to the knowledge of the Seller,
threatened by the SEC, or any commissioner of corporations or similar officer of
any state having jurisdiction over this transaction. The sale of the Shares is
legally permitted by all laws and regulations to which the Seller and the
Company are subject.

            3.13 No Broker. No broker or finder has acted for the Company in
connection with this Agreement or the transactions contemplated herein, and no
broker or finder is entitled to any brokerage or finder's fees or other
commissions in respect of such transactions based in any upon agreements,
arrangements or understandings made by or on behalf of the Company.

      4. REPRESENTATIONS AND WARRANTIES OF THE SELLER.

      The Seller hereby represents, warrants, and covenants with the Company as
follows:

            4.1 Legal Power. The Seller has the requisite corporate power and
authority to enter into this Agreement, to acquire the Shares hereunder, and to
carry out and perform its obligations under the terms of this Agreement.

            4.2 Due Execution. This Agreement has been duly executed and
delivered by Seller, and, upon due execution and delivery by the Company, this
Agreement will be a valid and binding agreement of the Seller.

<PAGE>
            4.3 Receipt and Review of SEC Reports. The Seller represents that it
has received and reviewed the SEC Reports and has been given full and complete
access to the Company for the purpose of obtaining such information as the
Seller or its respective qualified representative have reasonably requested in
connection with the decision to acquire the Shares. The Seller represents that
it has been afforded the opportunity to ask questions of the officers of the
Company regarding its business prospects and the Shares, all as the Seller or
its qualified representative have found necessary to make an informed investment
decision to acquire the Shares.

            4.4 Restricted Securities. The Seller has been advised that the
Shares have not been registered under the Securities Act or any other applicable
securities laws and that the Shares are being offered and sold pursuant to
Section 4(2) of the Securities Act, and that the Company's reliance upon Section
4(2) of the Securities Act is predicated in part on the Seller's representations
as contained herein.

                  4.4.1 The Seller acknowledges that the Shares have not been
registered under the Securities Act or the securities laws of any state and are
being offered, and will be sold, pursuant to applicable exemptions from such
registration for nonpublic offerings and will be sold as "restricted securities"
as defined by Rule 144 promulgated pursuant to the Securities Act. The Shares
may not be resold in the absence of an effective registration thereof under the
Securities Act and applicable state securities laws unless, in the opinion of
the Company's counsel, an applicable exemption from registration is available.

                  4.4.2 The Seller is acquiring the Shares for its own account,
for investment purposes only and not with a view to, or for sale in connection
with, a distribution, as that term is used in Section 2(11) of the Securities
Act, in a manner which would require registration under the Securities Act or
any state securities laws.

                  4.4.3 The Seller understands and acknowledges that the Shares
will bear the following legend:

         THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF
         ANY STATE. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT
         BE SOLD OR TRANSFERRED FOR VALUE IN THE ABSENCE OF AN EFFECTIVE
         REGISTRATION THEREOF UNDER THE SECURITIES ACT OF 1933 AND/OR THE
         SECURITIES ACT OF ANY STATE HAVING JURISDICTION OR AN OPINION OF
         COUNSEL ACCEPTABLE TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
         REQUIRED UNDER SUCH ACT OR ACTS.

<PAGE>
                  4.4.4 The Seller acknowledges that an investment in the Shares
is not liquid and is transferable only under limited conditions. The Seller
acknowledges that such securities must be held indefinitely unless they are
subsequently registered under the Securities Act or an exemption from such
registration is available. The Seller is aware of the provisions of Rule 144
promulgated under the Securities Act, which permits limited resale of securities
purchased in a private placement subject to the satisfaction of certain
conditions and that such Rule is not now available and, in the future, may not
become available for resale of the Shares.

            4.5 Seller Sophistication and Ability to Bear Risk of Loss. The
Seller acknowledges that it is able to protect its interests in connection with
the acquisition of the Shares and can bear the economic risk of investment in
such securities without producing a material adverse change in the Seller's
financial condition. The Seller otherwise has such knowledge and experience in
financial or business matters that it is capable of evaluating the merits and
risks of the investment in the Shares.

            4.6 Purchases by Groups. The Seller represents, warrants, and
covenants that it is not acquiring the Shares as part of a group within the
meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended.

            4.7 No Broker. Except for those brokers and/or finders to be
disclosed pursuant to Section 6.8, no broker or finder has acted for the Seller
in connection with this Agreement or the transactions contemplated herein, and,
except for those brokers and/or finders to be disclosed pursuant to Section 6.8,
no broker or finder is entitled to any brokerage or finder's fees or other
commissions in respect of such transactions based in any upon agreements,
arrangements or understandings made by or on behalf of the Company. The Seller
is solely responsible for the fees and expenses of those brokers and/or finders
to be disclosed pursuant to Section 6.8.

      5. COVENANTS

            5.1 Access and Investigation. Between the date of this Agreement and
the Closing Date, the Company will, and will cause its officers, directors,
principals, attorneys, agents, accountants, and employees (collectively,
"Representatives"), to (i) afford the Seller and its Representatives and
prospective sources of financing and their Representatives (collectively, "The
Seller's Advisors") full and free access to the Company's personnel, facilities,
properties, contracts, books and records, and other documents and data in order
that the Seller may have full opportunity to make such investigations as it
desires to make of the affairs of the Company, (b) furnish the Seller and its
Advisors with copies of all such contracts, books and records, and other
existing documents and data as the Seller may reasonably request, and (c)
furnish the Seller and its Advisors with such additional financial, operating,
legal, accounting, and other data and information as the Seller may reasonably
request, including, without limitation, access to the working papers of its
independent certified public accountants; provided, however, the Seller shall
not communicate with any personnel or business relation of Seller without
Seller's consent to communicate with such person, and further provided, however,
that any such investigation shall not affect or otherwise diminish or obviate in
any respect any of the representations and warranties of the Company herein.

<PAGE>
            5.2 Conduct of Business of the Company. Except as contemplated by
this Agreement or otherwise agreed to in writing by the Seller, during the
period from the date of this Agreement to the Closing Date, the Company shall
conduct its business and operations according to its ordinary and usual course
of business, to preserve substantially intact its business organizations and to
preserve its current relationships with customers, employees, suppliers and
other persons with which it has significant business relations.

            5.3 Negative Covenants. Except as otherwise expressly permitted by
this Agreement, between the date of this Agreement and the Closing Date, the
Company will not, without the prior consent of the Seller, take any affirmative
action, or fail to take any reasonable action within its control, as a result of
which any change of any representation or warranty of the Company in Article 3
hereof is likely to occur, including, but not limited to the following:

                  5.3.1 adopt any amendment to its certificate of incorporation
or bylaws, except the adoption and filing of a Certificate of Designation for
the Series A Preferred Stock;

                  5.3.2 except as contemplated by Section 1.2. hereto, issue,
reissue, sell, deliver or pledge or authorize or propose the issuance,
reissuance, sale, delivery or pledge of shares of capital stock of any class, or
debt or other securities convertible into capital stock of any class, or any
rights, warrants or options to acquire any convertible securities or capital
stock;

                  5.3.3 adjust, split, combine, subdivide, reclassify or redeem,
purchase or otherwise acquire, or propose to redeem or purchase or otherwise
acquire, any shares of its capital stock, or any of its other securities;

                  5.3.4 (i) create, incur, assume or repay any long-term debt
(including obligations in respect of capital leases), or, create, incur, assume,
repay, maintain or permit to exist any short-term debt; or (ii) assume,
guarantee, endorse or otherwise become liable or responsible (whether directly,
contingently or otherwise) for the obligations of any other person;

                  5.3.5 deposit, declare, set aside or pay any dividend or other
distribution (whether in cash, stock or property or any combination thereof) in
respect of its capital stock, redeem or otherwise acquire any shares of its
capital stock;

                  5.3.6 increase in any manner the compensation of any of its
directors, officers or other employees;

                  5.3.7 (i) sell, transfer, or otherwise dispose of, or agree to
sell, transfer, or otherwise dispose of, any properties or assets, real,
personal or mixed, or (ii) mortgage or encumber any properties or assets, real,
personal or mixed;

<PAGE>
                  5.3.8 permit any of its current insurance policies to be
canceled or terminated, unless replacement policies with equal or greater
coverage are in full force and effect;

                  5.3.9 enter into other agreements, commitments or contracts
not in the ordinary course of business or in excess of current requirements;

                  5.3.10 make or enter into any commitment of the Company for
capital expenditures for additions to property, plant, equipment or intangible
capital assets;

                  5.3.11 pay, lend or advance any amount to, or sell, transfer
or lease any of the Company's properties or assets (real, personal or mixed,
tangible or intangible) to, or enter into any agreement or arrangement with, any
of its officers, directors, shareholders or employees or any affiliate or
associate of any of its officers, directors, shareholders or employees;

                  5.3.12 enter into or amend in any material respect any
contract, agreement, lease, license or commitment, or take any action or omit to
take any action which will cause a breach, violation or default (however
defined) under any such existing items;

                  5.3.13 acquire any of the business or assets of any other
person or entity; or

                  5.3.14 agree in writing or otherwise to take any of the
foregoing actions.

            5.4 Required Approvals. As promptly as practicable after the date of
this Agreement, the Seller and the Company will make all filings required by any
federal, state, local, municipal, foreign, international, multinational, or
other administrative order, constitution, law, ordinance, principle of common
law, regulation, statute, or treaty ("Legal Requirements") to be made by them in
order to consummate the transactions contemplated by this Agreement. Between the
date of this Agreement and the Closing Date, the Seller and the Company will
cooperate with the other with respect to all filings that the other elects to
make or is required by Legal Requirements to make in connection with the
transactions contemplated by this Agreement.

<PAGE>
            5.5 Notification. Between the date of this Agreement and the Closing
Date, each party to this Agreement will promptly notify the other party in
writing if it becomes aware of any fact or condition that causes or constitutes
a breach of any of its representations and warranties as of the date of this
Agreement, or if such party becomes aware of the occurrence after the date of
this Agreement of any fact or condition that would (except as expressly
contemplated by this Agreement) cause or constitute a breach of any such
representation or warranty had such representation or warranty been made as of
the time of occurrence or discovery of such fact or condition; provided,
however, that such disclosure shall not be deemed to cure any breach of a
representation or warranty. Should any such fact or condition require any change
in the any disclosure schedule if such schedule were dated the date of the
occurrence or discovery of any such fact or condition, the discovering party
will promptly deliver to each other party a supplement to such disclosure
schedule specifying such change. During the same period, each party will
promptly notify the other party of the occurrence of any breach of any covenant
in this Article 5. During the same period, the Seller shall notify the Company
of the occurrence of any event that may make the satisfaction of any condition
in Article 6 impossible or unlikely. During the same period, the Company shall
notify the Seller of the occurrence of any event that may make the satisfaction
of any condition in Article 7 impossible or unlikely. Each party to this
Agreement shall promptly notify each other party hereto of any default, the
threat or commencement of any suits or proceedings (including without
limitation, proceedings by or before any arbitrator, government commission,
board, bureau or other administrative agency) (a "Proceeding") or any
development that occurs before the Closing that is reasonably likely to cause a
material adverse effect on such party.

            5.6 No Negotiation. Until such time, if any, as this Agreement is
terminated pursuant to Article 8, the Company will not, and will cause each of
its Representatives not to, directly or indirectly solicit, initiate, or
encourage any inquiries or proposals from, discuss or negotiate with, provide
any non-public information to, or consider the merits of any unsolicited
inquiries or proposals from, any individual, corporation, general or limited
partnership, limited liability company, joint venture, estate, trust,
association, organization, labor union or other entity or governmental body (a
"Person") (other than the Seller) relating to any transaction involving the sale
of a controlling interest of the Company or any of the Company's capital stock,
or any merger, consolidation, business combination, or similar transaction
involving the Company. The Company will promptly inform the Seller of any
written inquiry (including the terms thereof and the identity of the third party
making such inquiry) which it may receive in respect of the above and furnish to
the Seller a copy of any such written inquiry.

            5.7 Best Efforts. Between the date of this Agreement and the Closing
Date, each of the parties will use its best efforts to effectuate the
transactions contemplated by this Agreement and to cause the conditions in
Section 6 in the case of the Seller, and Section 7 in the case of the Company,
to be satisfied. Each party hereto, at the reasonable request of another party
hereto, shall execute and deliver such other instruments and do and perform such
other acts and things as may be necessary or desirable for effecting completely
the consummation of the transactions contemplated by this Agreement.

            5.8 Confidentiality of Information. Each party will hold in
confidence all confidential or proprietary documents and information related to
the other party and will refrain from disclosing or using any such confidential
information for such party's own benefit or to or for the benefit of any third
party. This obligation of confidentiality and non-use will not apply, or will
cease to apply, to such information which is in the public domain as of the
Closing Date or subsequently comes into the public domain through a source other
than the other party, or which is required to be disclosed by order of any court
or governmental agency of competent jurisdiction.

<PAGE>
            5.9 Press Releases and Announcements. The Company and the Seller
agree that the existence, nature and terms and conditions of this Agreement and
discussions between the parties regarding the transactions contemplated hereby
will be treated as confidential by the parties. Accordingly, each party agrees
that it will not make any public comment concerning or announcement of the
transactions contemplated hereby prior to Closing and will take reasonable steps
to restrict knowledge of the transactions contemplated hereby to those who need
to know. Notwithstanding the foregoing, the parties acknowledge and agree that
as a public company, the Company is subject to certain disclosure requirements
under applicable securities laws. For this reason, the Company reserves the
right to disclose the existence of and the status of negotiations at any time
prior to Closing if it determines that the securities laws or the rules of any
stock exchange require such disclosure; provided that each party will notify the
other party if it intends to make such a disclosure and provide the other party
with a copy of the proposed disclosure and an opportunity for the other party to
comment on such disclosure. Following the Closing, the Company and the Seller
may make any and all such disclosures of the terms of this Agreement and the
transactions contemplated hereby as they deem appropriate.

            5.10 Cooperation. Each party (including those former officers and
directors of the Company resigning at the Closing) hereto will, before, at, and
after the Closing, execute and deliver such instruments and take such other
actions as the other party or parties, as the case may be, may reasonably
require in order to carry out the intent of this Agreement. Without limiting the
generality of the foregoing, at any time after the Closing, at the request of
the Company or the Seller, and without further consideration, the Company
(including those former officers and directors of the Company resigning at the
Closing) (a) will execute and deliver such instruments of sale, transfer,
conveyance, assignment and confirmation and take such action as the Company or
the Seller may reasonably deem necessary or desirable in order to confirm the
Seller's title to the Shares, and (b) will execute such documents as and take
such action as the Company or the Seller may reasonably deem necessary or
desirable in order to prepare and file any future SEC Reports that the Company
seeks to file with the Securities and Exchange Commission under the Securities
Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

<PAGE>
            5.11 Seller's Finders/Brokerage Fees. The Seller is responsible for
paying all finders and/or brokerage fees in connection with this transaction
that (a) are identified pursuant to Section 6.8, or (b) result by reason of
services rendered or alleged to have been rendered for or at the instance of the
Seller with respect to the negotiation or execution of this Agreement or to the
delivery of the consideration herein specified. The Seller is not responsible
for any finders and/or brokerage fees that exist in contravention of the
representation set forth in Section 3.13 herein. Additionally, Seller agrees
that any remuneration paid to such broker(s) and/or finders in the form of the
Company's securities will be paid from the Preferred Shares being issued to the
Seller herein. The parties hereto agree to indemnify and hold harmless the other
from and against any and all claims, losses, liabilities or expenses which may
be asserted against or suffered by any as a result of any broker, finder or
other person claiming any fee or commission by reason of services rendered or
alleged to have been rendered for or at the instance of a particular party
hereto with respect to the negotiation or execution of this Agreement or to the
delivery of the consideration herein specified.

      6. CONDITIONS PRECEDENT TO THE COMPANY'S OBLIGATION TO CLOSE. The
Company's obligation to purchase the Assets and to take the other actions
required to be taken by the Company at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by the Company, in whole or in part in its sole
discretion):

            6.1 Accuracy of Representations. The representations and warranties
of the Seller in this Agreement must have been accurate in all material respects
as of the date of this Agreement and must be accurate in all material respects
as of the Closing as if made on the Closing Date without (i) giving effect to
any supplement to the disclosure schedules made after the date hereof (other
than supplements that merely update disclosures regarding actions permitted to
be taken under this Agreement) and (ii) regard to any materiality qualifications
contained in such representations and warranties.

            6.2 Seller's Performance. All of the covenants and obligations that
the Seller is required to perform or to comply with pursuant to this Agreement
at or prior to the Closing must have been performed and complied with in all
material respects.

            6.3 No Injunction. There must not be in effect any Legal Requirement
or any injunction or other order, award, decision, injunction, judgment ruling,
subpoena, or verdict entered, issued, made, or rendered by and court,
administrative agency, arbitrator, or other governmental body (an "Order") that
(a) prohibits the sale of the Assets by Seller to the Company, and (b) has been
adopted or issued, or has otherwise become effective, since the date of this
Agreement.

            6.4 Additional Documents. Each document reasonably requested by the
Company for the purpose of (a) evidencing the accuracy of any representation or
warranty of the Seller, (b) evidencing the performance by Seller, or the
compliance by Seller with, any covenant or obligation required to be performed
or complied with by Seller prior to the Closing or (c) evidencing the
satisfaction of any condition referred to in this Section 6 must have been
delivered to the Company.

            6.5 No Proceedings. Since the date of this Agreement, there must not
have been commenced or threatened against the Company or the Seller, or against
any Person that is an affiliate of the Company or the Seller, any Proceeding
relating to the Seller's business or the Assets that has a reasonable
probability of resulting in an order, judgment or decree restraining,
prohibiting or rendering unlawful the consummation of the transactions
contemplated by this Agreement.

<PAGE>
            6.6 No Prohibition. Neither the consummation nor the performance of
any of the transactions contemplated by this Agreement will, directly or
indirectly (with or without notice or lapse of time), materially contravene,
materially conflict with, or result in a material violation of, or cause the
Company or any Person that is an affiliate of the Company to suffer a material
adverse consequence under, (a) any applicable Legal Requirement or Order,
federal and state securities laws and the rules and regulations of the Federal
Reserve Board or any related Legal Requirement, or (b) any Legal Requirement or
Order that has been published, introduced, or otherwise formally proposed by or
before any governmental body.

            6.7 No Claim Regarding Ownership of Acquired Assets or Sales
Proceeds. There must not have been made or threatened by any Person (other than
the Company or the Seller) any claim asserting that such Person (a) is the
holder or the beneficial owner of, or has the right to acquire or to obtain
beneficial ownership of, any portion of the Assets, or (b) is entitled to all or
any portion of the Shares.

            6.8 Finder's/Brokerage Fees. The Seller shall have provided a list
of finders and/or brokerage fees which it has agreed to pay in connection with
the transactions contemplated by this Agreement.

      7. CONDITIONS PRECEDENT TO THE SELLER'S OBLIGATION TO CLOSE. The Seller's
obligation to sell the Assets and to take the other actions required to be taken
by the Seller at the Closing is subject to the satisfaction, at or prior to the
Closing, of each of the following conditions (any of which may be waived by the
Seller, in whole or in part in its sole discretion):

            7.1 Accuracy of Representations. The representations and warranties
of the Company in this Agreement must have been accurate in all material
respects as of the date of this Agreement and must be accurate in all material
respects as of the Closing as if made on the Closing Date without (i) giving
effect to any supplement to the disclosure schedules made after the date hereof
(other than supplements that merely update disclosures regarding actions
permitted to be taken under this Agreement) and (ii) regard to any materiality
qualifications contained in such representations and warranties.

            7.2 Company's Performance. All of the covenants and obligations that
the Company is required to perform or to comply with pursuant to this Agreement
at or prior to the Closing must have been performed and complied with in all
material respects.

            7.3 No Injunction. There must not be in effect any Legal Requirement
or any injunction or other Order that (a) prohibits the sale of the Assets by
Seller to the Company, and (b) has been adopted or issued, or has otherwise
become effective, since the date of this Agreement.

<PAGE>
            7.4 Additional Documents. Each document reasonably requested by the
Seller for the purpose of (a) evidencing the accuracy of any representation or
warranty of the Company, (b) evidencing the performance by the Company, or the
compliance by the Company with, any covenant or obligation required to be
performed or complied with by them prior to the Closing or (c) evidencing the
satisfaction of any condition referred to in this Section 7 must have been
delivered to the Seller.

            7.5 No Proceedings. Since the date of this Agreement, there must not
have been commenced or threatened against the Company or the Seller, or against
any Person that is an affiliate of the Company or the Seller, any Proceeding
relating to the Seller's business or the Assets that has a reasonable
probability of resulting in an order, judgment or decree restraining,
prohibiting or rendering unlawful the consummation of the transactions
contemplated by this Agreement.

            7.6 No Prohibition. Neither the consummation nor the performance of
any of the transactions contemplated by this Agreement will, directly or
indirectly (with or without notice or lapse of time), materially contravene,
materially conflict with, or result in a material violation of, or cause the
Seller or any Person that is an affiliate of the Seller to suffer a material
adverse consequence under, (a) any applicable Legal Requirement or Order,
federal and state securities laws and the rules and regulations of the Federal
Reserve Board or any related Legal Requirement, or (b) any Legal Requirement or
Order that has been published, introduced, or otherwise formally proposed by or
before any governmental body.

            7.7 No Claim Regarding Ownership of Acquired Assets or Sales
Proceeds. There must not have been made or threatened by any Person (other than
the Company or the Seller) any claim asserting that such Person (a) is the
holder or the beneficial owner of, or has the right to acquire or to obtain
beneficial ownership of, any portion of the Assets, or (b) is entitled to all or
any portion of the Shares.

            7.8 Due Diligence. The Seller will have received all information
requested by it pursuant to Section 5.1 of this Agreement, and shall be fully
satisfied, determined in its absolute sole discretion, with the results of its
due diligence conducted of the Company.

            7.9 Acceptance by Counsel to the Buyer. The form and substance of
all documents to be delivered at Closing hereunder will be reasonably acceptable
to the Seller and its counsel.

            7.10 Company Filing of Quarterly Report. The Company shall have
filed its quarterly report on Form 10-QSB for the period ending September 30,
2004 with the SEC (such quarterly report to constitute an "SEC Report" as
defined in Section 3.6 and to which the representations and warranties of
Section 3.6 shall apply).

      8. TERMINATION.

<PAGE>
            8.1 Termination Events. This Agreement may, by notice given prior to
or at the Closing, be terminated:

                  8.1.1 by the Company, on the one hand, or the Seller, on the
other hand, if a material breach of any provision of this Agreement has been
committed by the other party and such breach has not been waived;

                  8.1.2 by the Company, if any of the conditions in Section 6
has not been satisfied as of the Closing Date or if satisfaction of such a
condition is or becomes impossible (other than through the failure of the
Company to comply with its obligations under this Agreement) and the Company has
not waived such condition on or before the Closing Date;

                  8.1.3 by the Seller, if any of the conditions in Section 7 has
not been satisfied as of the Closing Date or if satisfaction of such a condition
is or becomes impossible (other than through the failure of the Seller to comply
with its obligations under this Agreement) and the Seller has not waived such
condition on or before the Closing Date;

                  8.1.4 by mutual consent of the Company and the Seller; or

                  8.1.5 by either the Company or the Seller, if the Closing has
not occurred (other than through the failure of any party seeking to terminate
this Agreement to comply fully with its obligations under this Agreement) on or
before October 31, 2004, or such later date as the parties may agree upon.

            8.2 Effect of Termination. Each party's right of termination under
Section 8.1 is in addition to any other rights it may have under this Agreement
or otherwise, and the exercise of a right of termination will not be an election
of remedies. If this Agreement is terminated pursuant to Section 8.1, all
further obligations of the parties under this Agreement will terminate, except
that the obligations in Sections 5.8 and 5.9 will survive; provided, however,
that if this Agreement is terminated by a party because of the breach of the
Agreement by the other party or because one or more of the conditions to the
terminating party's obligations under this Agreement is not satisfied as a
result of the other party's failure to comply with its obligations under this
Agreement, the terminating party's right to pursue all legal remedies will
survive such termination unimpaired.

      9. MISCELLANEOUS.

            9.1 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of California.

            9.2 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto.

<PAGE>
            9.3 Entire Agreement. This Agreement and the Exhibits hereto and
thereto, and the other documents delivered pursuant hereto and thereto,
constitute the full and entire understanding and agreement among the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other party in any manner by any representations, warranties, covenants, or
agreements except as specifically set forth herein or therein. Nothing in this
Agreement, express or implied, is intended to confer upon any party, other than
the parties hereto and their respective successors and assigns, any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided herein.

            9.4 Severability. In case any provision of this Agreement shall be
invalid, illegal, or unenforceable, it shall to the extent practicable, be
modified so as to make it valid, legal and enforceable and to retain as nearly
as practicable the intent of the parties, and the validity, legality, and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

            9.5 Amendment and Waiver. Except as otherwise provided herein, any
term of this Agreement may be amended, and the observance of any term of this
Agreement may be waived (either generally or in a particular instance, either
retroactively or prospectively, and either for a specified period of time or
indefinitely), with the written consent of the Company and the Seller. Any
amendment or waiver effected in accordance with this Section shall be binding
upon each future holder of any security purchased under this Agreement
(including securities into which such securities have been converted) and the
Company.

            9.6 Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be effective when delivered
personally, or sent by telex or telecopier (with receipt confirmed), provided
that a copy is mailed by registered mail, return receipt requested, or when
received by the addressee, if sent by Express Mail, Federal Express or other
express delivery service (receipt requested) in each case to the appropriate
address set forth below:

                  If to the Seller:         Palomar Enterprises, Inc.
                                            120 Birmingham Drive, Suite 110G
                                            Cardiff, CA 92007

                  If to the Company:        Market Share Recovery, Inc.
                                            95 Broadhollow Road, Suite 101
                                            Melville, NY 11747

            9.7 Faxes and Counterparts. This Agreement may be executed in one or
more counterparts. Delivery of an executed counterpart of the Agreement or any
exhibit attached hereto by facsimile transmission shall be equally as effective
as delivery of an executed hard copy of the same. Any party delivering an
executed counterpart of this Agreement or any exhibit attached hereto by
facsimile transmission shall also deliver an executed hard copy of the same, but
the failure by such party to deliver such executed hard copy shall not affect
the validity, enforceability or binding nature effect of this Agreement or such
exhibit.

<PAGE>
            9.8 Titles and Subtitles. The titles of the paragraphs and
subparagraphs of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

<PAGE>
      IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.

COMPANY:                                    Market Share Recovery, Inc.

                                            /s/ Raymond Barton
                                            -----------------------------------
                                            By:  Raymond Barton
                                            Title:  Chief Executive Officer

SELLER:                                     PALOMAR ENTERPRISES, INC.

                                            /s/ Steven Bonenberger
                                            -----------------------------------
                                            By:  Steven Bonenberger
                                            Title: President

                  [Signature Page to Asset Purchase Agreement]

<PAGE>
                                    EXHIBIT A

                      [FORM OF] CERTIFICATE OF DESIGNATION
                            SERIES A PREFERRED STOCK

<PAGE>
                                    EXHIBIT B

                             [FORM OF] BILL OF SALE

<PAGE>
                                 SCHEDULE 1.1.2

                         AUTOMOTIVE NOTES AND CONTRACTS

<PAGE>
                                  SCHEDULE 3.11

                                   LIABILITIES

<PAGE>

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