Document:

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Warrant No. 06-C-10

NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY SUCH SECURITIES

                          COMMON STOCK PURCHASE WARRANT

                      To Purchase Shares of Common Stock of

                                 EDENTIFY, INC.

          THIS COMMON STOCK PURCHASE WARRANT (the "Warrant") certifies that, for
value received, Bushido Capital Master Fund, L.P. (the "Holder"), is entitled,
upon the terms and subject to the limitations on exercise and the conditions
hereinafter set forth, at any time on or after the date hereof (the "Initial
Exercise Date") and on or prior to the close of business on the fifth
anniversary of the Initial Exercise Date (the "Termination Date") but not
thereafter, to subscribe for and purchase from Edentify, Inc., a Nevada
corporation (the "Company"), such number of shares of Common Stock of the
Company equal to the Holder's Warrant Subscription Amount divided by the
Exercise Price (the "Warrant Shares"). The purchase price of each Warrant Share
under this Warrant shall be equal to the Exercise Price, as defined in
Section 2(b).

     Section 1. Definitions. Capitalized terms used and not otherwise defined
herein shall have the meanings set forth in that certain Securities Purchase
Agreement (the "Purchase Agreement"), dated September 29, 2006, among the
Company and the purchasers signatory thereto. For purposes of this Warrant, the
term "Warrant Subscription Allocation" shall mean the Subscription Amount of the
Holder on the Closing Date.

     Section 2. Exercise.

          a) Exercise of Warrant. Exercise of the purchase rights represented by
     this Warrant may be made at any time or times on or after the Initial
     Exercise Date and on or before the Termination Date by delivery to the
     Company of a duly executed facsimile copy of the Notice of Exercise Form
     annexed hereto (or such other office or agency of

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     the Company as it may designate by notice in writing to the registered
     Holder at the address of such Holder appearing on the books of the Company)
     which shall provide for the exercise of all or part of the Warrant
     Subscription Allocation; provided, however, within 5 Business Days of the
     date said Notice of Exercise is delivered to the Company, the Holder shall
     have surrendered this Warrant to the Company and the Company shall have
     received payment of the aggregate Exercise Price of the shares thereby
     purchased by wire transfer or cashier's check drawn on a United States
     bank. The number of shares issuable to the Holder shall be equal to the
     product of (i) the quotient of portion of the Warrant Subscription
     Allocation then being exercised divided by the aggregate Warrant
     Subscription Allocation on the Original Exercise Date by the Holder and
     (ii) the 10% Amount on the date the Notice of Exercise is delivered. This
     Warrant shall be fully exercised upon exercise of the full Warrant
     Subscription Allocation whether in one or more events of exercise.

          b) Exercise Price. The exercise price (the "Exercise Price") of each
     Warrant Share granted pursuant to this Warrant shall be $0.50 per share.

          c) Cashless Exercise. At any time after one year from the date of
     issuance of this Warrant this Warrant may also be exercised at such time by
     means of a "cashless exercise" in which the Holder shall be entitled to
     receive a certificate for the number of Warrant Shares equal to the
     quotient obtained by dividing [(A-B) (X)] by (A), where:

          (A) = the volume weighted-average price on the Business Day
                immediately preceding the date of such election;

          (B) = the Exercise Price of this Warrant, as adjusted; and

          (X) = the number of Warrant Shares issuable upon exercise of this
                Warrant in accordance with the terms of this Warrant by means of
                a cash exercise rather than a cashless exercise.

          Notwithstanding anything herein to the contrary, on the Termination
     Date, this Warrant shall be automatically exercised via cashless exercise
     pursuant to this Section 2(c).

          d) Exercise Limitations. At any time after the Common Stock is
     registered under Section 12 of the Exchange Act, the Holder shall not have
     the right to exercise any portion of this Warrant, pursuant to Section 2(c)
     or otherwise, to the extent that after giving effect to such issuance after
     exercise, the Holder (together with the Holder's affiliates), as set forth
     on the applicable Notice of Exercise, would beneficially own in excess of
     4.99% of the number of shares of the Common Stock outstanding immediately
     after giving effect to such issuance. For purposes of the foregoing
     sentence, the number of shares of Common Stock beneficially owned by the
     Holder and its affiliates shall include the number of shares of Common
     Stock issuable upon exercise of this Warrant with respect to which the
     determination of such sentence is being made, but shall exclude the number
     of shares of Common Stock which would be issuable upon (A) exercise of the
     remaining, nonexercised portion of this Warrant beneficially owned by the
     Holder or

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     any of its affiliates and (B) exercise or conversion of the unexercised or
     nonconverted portion of any other securities of the Company (including,
     without limitation, any other Debentures or Warrants) subject to a
     limitation on conversion or exercise analogous to the limitation contained
     herein beneficially owned by the Holder or any of its affiliates. Except as
     set forth in the preceding sentence, for purposes of this Section 2(d),
     beneficial ownership shall be calculated in accordance with Section 13(d)
     of the Exchange Act, it being acknowledged by Holder that the Company is
     not representing to Holder that such calculation is in compliance with
     Section 13(d) of the Exchange Act and Holder is solely responsible for any
     schedules required to be filed in accordance therewith. To the extent that
     the limitation contained in this Section 2(d) applies, the determination of
     whether this Warrant is exercisable (in relation to other securities owned
     by the Holder) and of which a portion of this Warrant is exercisable shall
     be in the sole discretion of such Holder, and the submission of a Notice of
     Exercise shall be deemed to be such Holder's determination of whether this
     Warrant is exercisable (in relation to other securities owned by such
     Holder) and of which portion of this Warrant is exercisable, in each case
     subject to such aggregate percentage limitation, and the Company shall have
     no obligation to verify or confirm the accuracy of such determination. For
     purposes of this Section 2(d), in determining the number of outstanding
     shares of Common Stock, the Holder may rely on the number of outstanding
     shares of Common Stock as reflected in (x) Schedule 3.1(g) to the Purchase
     Agreement, (y) a more recent public announcement by the Company or (z) any
     other notice by the Company or the Company's Transfer Agent setting forth
     the number of shares of Common Stock outstanding. Upon the written or oral
     request of the Holder, the Company shall within two Business Days confirm
     orally and in writing to the Holder the number of shares of Common Stock
     then outstanding. In any case, the number of outstanding shares of Common
     Stock shall be determined after giving effect to the conversion or exercise
     of securities of the Company, including this Warrant, by the Holder or its
     affiliates since the date as of which such number of outstanding shares of
     Common Stock was reported. The provisions of this Section 2(d) may be
     waived by the Holder upon, at the election of the Holder, not less than 61
     days' prior notice to the Company, and the provisions of this Section 2(d)
     shall continue to apply until such 61st day (or such later date, as
     determined by the Holder, as may be specified in such notice of waiver).

          e) Mechanics of Exercise.

                    i. Authorization of Warrant Shares. The Company covenants
               that all Warrant Shares which may be issued upon the exercise of
               the purchase rights represented by this Warrant will, upon
               exercise of the purchase rights represented by this Warrant, be
               duly authorized, validly issued, fully paid and nonassessable and
               free from all taxes, liens and charges in respect of the issue
               thereof (other than taxes in respect of any transfer occurring
               contemporaneously with such issue). The Company covenants that
               during the period the Warrant is outstanding, it will reserve
               from its authorized and unissued Common Stock a sufficient number
               of shares to provide for the issuance of the Warrant Shares upon
               the exercise of any purchase rights under this Warrant. The
               Company further covenants that its issuance of this Warrant shall
               constitute full authority to

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               its officers who are charged with the duty of executing stock
               certificates to execute and issue the necessary certificates for
               the Warrant Shares upon the exercise of the purchase rights under
               this Warrant. The Company will take all such reasonable action as
               may be necessary to assure that such Warrant Shares may be issued
               as provided herein without violation of any applicable law or
               regulation, or of any requirements of the Trading Market upon
               which the Common Stock may be listed.

                    ii. Delivery of Certificates Upon Exercise. Certificates for
               shares purchased hereunder shall be transmitted by the transfer
               agent of the Company to the Holder by crediting the account of
               the Holder's prime broker with the Depository Trust Company
               through its Deposit Withdrawal Agent Commission ("DWAC") system
               if the Company is a participant in such system, and otherwise by
               physical delivery to the address specified by the Holder in the
               Notice of Exercise within 3 Business Days from the delivery to
               the Company of the Notice of Exercise Form, surrender of this
               Warrant and payment of the aggregate Exercise Price as set forth
               above ("Warrant Share Delivery Date"). This Warrant shall be
               deemed to have been exercised on the date the Exercise Price is
               received by the Company. The Warrant Shares shall be deemed to
               have been issued, and Holder or any other person so designated to
               be named therein shall be deemed to have become a holder of
               record of such shares for all purposes, as of the date the
               Warrant has been exercised by payment to the Company of the
               Exercise Price and all taxes required to be paid by the Holder,
               if any, pursuant to Section 2(e)(vii) prior to the issuance of
               such shares, have been paid.

                    iii. Delivery of New Warrants Upon Exercise. If this Warrant
               shall have been exercised in part, the Company shall, at the time
               of delivery of the certificate or certificates representing
               Warrant Shares, deliver to Holder a new Warrant evidencing the
               rights of Holder to purchase the unpurchased Warrant Shares
               called for by this Warrant, which new Warrant shall in all other
               respects be identical with this Warrant.

                    iv. Rescission Rights. If the Company fails to cause its
               transfer agent to transmit to the Holder a certificate or
               certificates representing the Warrant Shares pursuant to this
               Section 2(e)(iv) by the Warrant Share Delivery Date, then the
               Holder will have the right to rescind such exercise.

                    v. Compensation for Buy-In on Failure to Timely Deliver
               Certificates Upon Exercise. In addition to any other rights
               available to the Holder, if the Company fails to cause its
               transfer agent to transmit to the Holder a certificate or
               certificates representing the Warrant Shares pursuant to an
               exercise on or before the Warrant Share Delivery Date, and if
               after such date the Holder is required by its broker to purchase
               (in an open market transaction or otherwise) shares of Common
               Stock to deliver

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               in satisfaction of a sale by the Holder of the Warrant Shares
               which the Holder anticipated receiving upon such exercise (a
               "Buy-In"), then the Company shall (1) pay in cash to the Holder
               the amount by which (x) the Holder's total purchase price
               (including brokerage commissions, if any) for the shares of
               Common Stock so purchased exceeds (y) the amount obtained by
               multiplying (A) the number of Warrant Shares that the Company was
               required to deliver to the Holder in connection with the exercise
               at issue times (B) the price at which the sell order giving rise
               to such purchase obligation was executed, and (2) at the option
               of the Holder, either reinstate the portion of the Warrant and
               equivalent number of Warrant Shares for which such exercise was
               not honored or deliver to the Holder the number of shares of
               Common Stock that would have been issued had the Company timely
               complied with its exercise and delivery obligations hereunder.
               For example, if the Holder purchases Common Stock having a total
               purchase price of $11,000 to cover a Buy-In with respect to an
               attempted exercise of shares of Common Stock with an aggregate
               sale price giving rise to such purchase obligation of $10,000,
               under clause (1) of the immediately preceding sentence the
               Company shall be required to pay the Holder $1,000. The Holder
               shall provide the Company written notice indicating the amounts
               payable to the Holder in respect of the Buy-In, together with
               applicable confirmations and other evidence reasonably requested
               by the Company. Nothing herein shall limit a Holder's right to
               pursue any other remedies available to it hereunder, at law or in
               equity including, without limitation, a decree of specific
               performance and/or injunctive relief with respect to the
               Company's failure to timely deliver certificates representing
               shares of Common Stock upon exercise of the Warrant as required
               pursuant to the terms hereof.

                    vi. No Fractional Shares or Scrip. No fractional shares or
               scrip representing fractional shares shall be issued upon the
               exercise of this Warrant. As to any fraction of a share which
               Holder would otherwise be entitled to purchase upon such
               exercise, the Company shall pay a cash adjustment in respect of
               such final fraction in an amount equal to such fraction
               multiplied by the Exercise Price.

                    vii. Charges, Taxes and Expenses. Issuance of certificates
               for Warrant Shares shall be made without charge to the Holder for
               any issue or transfer tax or other incidental expense in respect
               of the issuance of such certificate, all of which taxes and
               expenses shall be paid by the Company, and such certificates
               shall be issued in the name of the Holder or in such name or
               names as may be directed by the Holder; provided, however, that
               in the event certificates for Warrant Shares are to be issued in
               a name other than the name of the Holder, this Warrant when
               surrendered for exercise shall be accompanied by the Assignment
               Form attached hereto duly executed by the Holder; and the Company
               may

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               require, as a condition thereto, the payment of a sum sufficient
               to reimburse it for any transfer tax incidental thereto.

                    viii. Closing of Books. The Company will not close its
               stockholder books or records in any manner which prevents the
               timely exercise of this Warrant, pursuant to the terms hereof.

     Section 3. Certain Adjustments.

          a) Fundamental Transaction. If, at any time while this Warrant is
     outstanding, (A) the Company effects any merger or consolidation of the
     Company with or into another Person, (B) the Company effects any sale of
     all or substantially all of its assets in one or a series of related
     transactions, (C) any tender offer or exchange offer (whether by the
     Company or another Person) is completed pursuant to which holders of Common
     Stock are permitted to tender or exchange their shares for other
     securities, cash or property, or (D) the Company effects any
     reclassification of the Common Stock or any compulsory share exchange
     pursuant to which the Common Stock is effectively converted into or
     exchanged for other securities, cash or property (in any such case, a
     "Fundamental Transaction"), then, upon any subsequent conversion of this
     Warrant, the Holder shall have the right to receive, for each Warrant Share
     that would have been issuable upon such exercise absent such Fundamental
     Transaction, at the option of the Holder, (a) upon exercise of this
     Warrant, the number of shares of Common Stock of the successor or acquiring
     corporation or of the Company, if it is the surviving corporation, and
     Alternate Consideration receivable upon or as a result of such
     reorganization, reclassification, merger, consolidation or disposition of
     assets by a Holder of the number of shares of Common Stock for which this
     Warrant is exercisable immediately prior to such event or (b) if the
     Company is acquired in an all cash transaction, cash equal to the value of
     this Warrant as determined in accordance with the Black-Scholes option
     pricing formula (the "Alternate Consideration"). If holders of Common Stock
     are given any choice as to the securities, cash or property to be received
     in a Fundamental Transaction, then the Holder shall be given the same
     choice as to the Alternate Consideration it receives upon any exercise of
     this Warrant following such Fundamental Transaction. To the extent
     necessary to effectuate the foregoing provisions, any successor to the
     Company or surviving entity in such Fundamental Transaction shall issue to
     the Holder a new warrant consistent with the foregoing provisions and
     evidencing the Holder's right to exercise such warrant into Alternate
     Consideration. The terms of any agreement pursuant to which a Fundamental
     Transaction is effected shall include terms requiring any such successor or
     surviving entity to comply with the provisions of this Section 3(a) and
     insuring that this Warrant (or any such replacement security) will be
     similarly adjusted upon any subsequent transaction analogous to a
     Fundamental Transaction. To the extent necessary to effectuate the
     foregoing provisions, any successor to the Company or surviving entity in
     such Fundamental Transaction shall issue to the Holder a new warrant with
     substantially the same form as this warrant and consistent with the
     foregoing provisions and evidencing the Holder's right to convert such
     warrant into Alternate Consideration. In furtherance thereof, in the event
     a Public Liquidity Company is not the Company, the Public Liquidity Company
     shall issue a new warrant in substantially the same form as this Warrant.

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          b) Voluntary Adjustment By Company. The Company may at any time during
     the term of this Warrant reduce the then current Exercise Price to any
     amount and for any period of time deemed appropriate by the Board of
     Directors of the Company.

          c) Notice to Holders.

                    i. Adjustment to Exercise Price. Whenever the Exercise Price
               is adjusted pursuant to this Section 3, the Company shall
               promptly mail to each Holder a notice setting forth the Exercise
               Price after such adjustment and setting forth a brief statement
               of the facts requiring such adjustment. If the Company issues a
               variable rate security, despite the prohibition thereon in the
               Purchase Agreement, the Company shall be deemed to have issued
               Common Stock or Common Stock Equivalents at the lowest possible
               conversion or exercise price at which such securities may be
               converted or exercised in the case of a Variable Rate Transaction
               (as defined in the Purchase Agreement), or the lowest possible
               adjustment price in the case of an MFN Transaction (as defined in
               the Purchase Agreement.

                    ii. Notice to Allow Exercise by Holder. If (A) the Company
               shall declare a dividend (or any other distribution) on the
               Common Stock; (B) the Company shall declare a special
               nonrecurring cash dividend on or a redemption of the Common
               Stock; (C) the Company shall authorize the granting to all
               holders of the Common Stock rights or warrants to subscribe for
               or purchase any shares of capital stock of any class or of any
               rights; (D) the approval of any stockholders of the Company shall
               be required in connection with any reclassification of the Common
               Stock, any consolidation or merger to which the Company is a
               party, any sale or transfer of all or substantially all of the
               assets of the Company, of any compulsory share exchange whereby
               the Common Stock is converted into other securities, cash or
               property; (E) the Company shall authorize the voluntary or
               involuntary dissolution, liquidation or winding up of the affairs
               of the Company; then, in each case, the Company shall cause to be
               mailed to the Holder at its last addresses as it shall appear
               upon the Warrant Register of the Company, at least 20 calendar
               days prior to the applicable record or effective date hereinafter
               specified, a notice stating (x) the date on which a record is to
               be taken for the purpose of such dividend, distribution,
               redemption, rights or warrants, or if a record is not to be
               taken, the date as of which the holders of the Common Stock of
               record to be entitled to such dividend, distributions,
               redemption, rights or warrants are to be determined or (y) the
               date on which such reclassification, consolidation, merger, sale,
               transfer or share exchange is expected to become effective or
               close, and the date as of which it is expected that holders of
               the Common Stock of record shall be entitled to exchange their
               shares of the Common Stock for securities, cash or other property
               deliverable upon such reclassification, consolidation, merger,
               sale, transfer or share exchange; provided, that the failure to
               mail such

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               notice or any defect therein or in the mailing thereof shall not
               affect the validity of the corporate action required to be
               specified in such notice. The Holder is entitled to exercise this
               Warrant during the 20-day period commencing the date of such
               notice to the effective date of the event triggering such notice.

     Section 4. Transfer of Warrant.

          a) Transferability. Subject to compliance with any applicable
     securities laws and the conditions set forth in Sections 5(a) and 4(d)
     hereof and to the provisions of Section 4.1 of the Purchase Agreement, this
     Warrant and all rights hereunder are transferable, in whole or in part,
     upon surrender of this Warrant at the principal office of the Company,
     together with a written assignment of this Warrant substantially in the
     form attached hereto duly executed by the Holder or its agent or attorney
     and funds sufficient to pay any transfer taxes payable upon the making of
     such transfer. Upon such surrender and, if required, such payment, the
     Company shall execute and deliver a new Warrant or Warrants in the name of
     the assignee or assignees and in the denomination or denominations
     specified in such instrument of assignment, and shall issue to the assignor
     a new Warrant evidencing the portion of this Warrant not so assigned, and
     this Warrant shall promptly be cancelled. A Warrant, if properly assigned,
     may be exercised by a new holder for the purchase of Warrant Shares without
     having a new Warrant issued.

          b) New Warrants. This Warrant may be divided or combined with other
     Warrants upon presentation hereof at the aforesaid office of the Company,
     together with a written notice specifying the names and denominations in
     which new Warrants are to be issued, signed by the Holder or its agent or
     attorney. Subject to compliance with Section 4(a), as to any transfer which
     may be involved in such division or combination, the Company shall execute
     and deliver a new Warrant or Warrants in exchange for the Warrant or
     Warrants to be divided or combined in accordance with such notice.

          c) Warrant Register. The Company shall register this Warrant, upon
     records to be maintained by the Company for that purpose (the "Warrant
     Register"), in the name of the record Holder hereof from time to time. The
     Company may deem and treat the registered Holder of this Warrant as the
     absolute owner hereof for the purpose of any exercise hereof or any
     distribution to the Holder, and for all other purposes, absent actual
     notice to the contrary.

          d) Transfer Restrictions. If, at the time of the surrender of this
     Warrant in connection with any transfer of this Warrant, the transfer of
     this Warrant shall not be registered pursuant to an effective registration
     statement under the Securities Act and under applicable state securities or
     blue sky laws, the Company may require, as a condition of allowing such
     transfer (i) that the Holder or transferee of this Warrant, as the case may
     be, furnish to the Company a written opinion of counsel (which opinion
     shall be in form, substance and scope customary for opinions of counsel in
     comparable transactions) to the effect that such transfer may be made
     without registration under the Securities Act and under applicable state
     securities or blue sky laws, (ii) that the holder or transferee execute and
     deliver to the Company an investment letter in form and substance

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     acceptable to the Company and (iii) that the transferee be an "accredited
     investor" as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7), or (a)(8)
     promulgated under the Securities Act or a qualified institutional buyer as
     defined in Rule 144A(a) under the Securities Act.

     Section 5. Miscellaneous.

          a) Title to Warrant. Prior to the Termination Date and subject to
     compliance with applicable laws and Section 4 of this Warrant, this Warrant
     and all rights hereunder are transferable, in whole or in part, at the
     office or agency of the Company by the Holder in person or by duly
     authorized attorney, upon surrender of this Warrant together with the
     Assignment Form annexed hereto properly endorsed. The transferee shall sign
     an investment letter in form and substance reasonably satisfactory to the
     Company.

          b) No Rights as Shareholder Until Exercise. This Warrant does not
     entitle the Holder to any voting rights or other rights as a shareholder of
     the Company prior to the exercise hereof. Upon the surrender of this
     Warrant and the payment of the aggregate Exercise Price (or by means of a
     cashless exercise), the Warrant Shares so purchased shall be and be deemed
     to be issued to such Holder as the record owner of such shares as of the
     close of business on the later of the date of such surrender or payment.

          c) Loss, Theft, Destruction or Mutilation of Warrant. The Company
     covenants that upon receipt by the Company of evidence reasonably
     satisfactory to it of the loss, theft, destruction or mutilation of this
     Warrant or any stock certificate relating to the Warrant Shares, and in
     case of loss, theft or destruction, of indemnity or security reasonably
     satisfactory to it (which, in the case of the Warrant, shall not include
     the posting of any bond), and upon surrender and cancellation of such
     Warrant or stock certificate, if mutilated, the Company will make and
     deliver a new Warrant or stock certificate of like tenor and dated as of
     such cancellation, in lieu of such Warrant or stock certificate.

          d) Saturdays, Sundays, Holidays, etc. If the last or appointed day for
     the taking of any action or the expiration of any right required or granted
     herein shall be a Saturday, Sunday or a legal holiday, then such action may
     be taken or such right may be exercised on the next succeeding day not a
     Saturday, Sunday or legal holiday.

          e) Authorized Shares.

               The Company covenants that during the period the Warrant is
          outstanding, it will reserve from its authorized and unissued Common
          Stock a sufficient number of shares to provide for the issuance of the
          Warrant Shares upon the exercise of any purchase rights under this
          Warrant. The Company further covenants that its issuance of this
          Warrant shall constitute full authority to its officers who are
          charged with the duty of executing stock certificates to execute and
          issue the necessary certificates for the Warrant Shares upon the
          exercise of the purchase rights under this Warrant. The Company will
          take all such reasonable action as may be necessary to assure that
          such Warrant Shares may be issued as provided herein without violation
          of any applicable law or regulation, or

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          of any requirements of the Trading Market upon which the Common Stock
          may be listed.

               Except and to the extent as waived or consented to by the Holder,
          the Company shall not by any action, including, without limitation,
          amending its certificate of incorporation or through any
          reorganization, transfer of assets, consolidation, merger,
          dissolution, issue or sale of securities or any other voluntary
          action, avoid or seek to avoid the observance or performance of any of
          the terms of this Warrant, but will at all times in good faith assist
          in the carrying out of all such terms and in the taking of all such
          actions as may be necessary or appropriate to protect the rights of
          Holder as set forth in this Warrant against impairment. Without
          limiting the generality of the foregoing, the Company will (a) not
          increase the par value of any Warrant Shares above the amount payable
          therefor upon such exercise immediately prior to such increase in par
          value, (b) take all such action as may be necessary or appropriate in
          order that the Company may validly and legally issue fully paid and
          nonassessable Warrant Shares upon the exercise of this Warrant, and
          (c) use commercially reasonable efforts to obtain all such
          authorizations, exemptions or consents from any public regulatory body
          having jurisdiction thereof as may be necessary to enable the Company
          to perform its obligations under this Warrant.

               Before taking any action which would result in an adjustment in
          the number of Warrant Shares for which this Warrant is exercisable or
          in the Exercise Price, the Company shall obtain all such
          authorizations or exemptions thereof, or consents thereto, as may be
          necessary from any public regulatory body or bodies having
          jurisdiction thereof.

          f) Jurisdiction. All questions concerning the construction, validity,
     enforcement and interpretation of this Warrant shall be determined in
     accordance with the provisions of the Purchase Agreement.

          g) Restrictions. The Holder acknowledges that the Warrant Shares
     acquired upon the exercise of this Warrant, if not registered, will have
     restrictions upon resale imposed by state and federal securities laws.

          h) Nonwaiver and Expenses. No course of dealing or any delay or
     failure to exercise any right hereunder on the part of Holder shall operate
     as a waiver of such right or otherwise prejudice Holder's rights, powers or
     remedies, notwithstanding the fact that all rights hereunder terminate on
     the Termination Date. If the Company willfully and knowingly fails to
     comply with any provision of this Warrant, which results in any material
     damages to the Holder, the Company shall pay to Holder such amounts as
     shall be sufficient to cover any costs and expenses including, but not
     limited to, reasonable attorneys' fees, including those of appellate
     proceedings, incurred by Holder in collecting any amounts due pursuant
     hereto or in otherwise enforcing any of its rights, powers or remedies
     hereunder.

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          i) Notices. Any notice, request or other document required or
     permitted to be given or delivered to the Holder by the Company shall be
     delivered in accordance with the notice provisions of the Purchase
     Agreement.

          j) Limitation of Liability. No provision hereof, in the absence of any
     affirmative action by Holder to exercise this Warrant or purchase Warrant
     Shares, and no enumeration herein of the rights or privileges of Holder,
     shall give rise to any liability of Holder for the purchase price of any
     Common Stock or as a stockholder of the Company, whether such liability is
     asserted by the Company or by creditors of the Company.

          k) Remedies. Holder, in addition to being entitled to exercise all
     rights granted by law, including recovery of damages, will be entitled to
     specific performance of its rights under this Warrant. The Company agrees
     that monetary damages would not be adequate compensation for any loss
     incurred by reason of a breach by it of the provisions of this Warrant and
     hereby agrees to waive the defense in any action for specific performance
     that a remedy at law would be adequate.

          l) Successors and Assigns. Subject to applicable securities laws, this
     Warrant and the rights and obligations evidenced hereby shall inure to the
     benefit of and be binding upon the successors of the Company and the
     successors and permitted assigns of Holder. The provisions of this Warrant
     are intended to be for the benefit of all Holders from time to time of this
     Warrant and shall be enforceable by any such Holder or holder of Warrant
     Shares.

          m) Amendment. This Warrant may be modified or amended or the
     provisions hereof waived with the written consent of the Company and the
     Holder.

          n) Severability. Wherever possible, each provision of this Warrant
     shall be interpreted in such manner as to be effective and valid under
     applicable law, but if any provision of this Warrant shall be prohibited by
     or invalid under applicable law, such provision shall be ineffective to the
     extent of such prohibition or invalidity, without invalidating the
     remainder of such provisions or the remaining provisions of this Warrant.

          o) Headings. The headings used in this Warrant are for the convenience
     of reference only and shall not, for any purpose, be deemed a part of this
     Warrant.

          p) Piggy-Back Registrations. If the Company shall determine to prepare
     and file with the Commission a registration statement relating to an
     offering for its own account or the account of others under the Securities
     Act of any of its equity securities, other than on Form S-4 or Form S-8
     (each as promulgated under the Securities Act) or their then equivalents
     relating to equity securities to be issued solely in connection with any
     acquisition of any entity or business or equity securities issuable in
     connection with the stock option or other employee benefit plans, then the
     Company shall send to each Holder a written notice of such determination
     and, if within 15 days after the date of such notice, any such Holder shall
     so request in writing, the Company shall include in such registration
     statement all or any part of such Registrable Securities (as defined in the
     Purchase Agreement) such Holder requests to be registered; provided, that,
     the Company

                                       11

<PAGE>

     shall not be required to register any Registrable Securities pursuant to
     this Section 5(p) that are eligible for resale pursuant to Rule 144(k)
     promulgated under the Securities Act or that are the subject of a then
     effective Registration Statement.

                              ********************

                                       12

<PAGE>

          IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
by its officer thereunto duly authorized.

Dated: September 29, 2006

                                        EDENTIFY, INC.

                                        By: /s/ Terrence DeFranco
                                            ------------------------------------
                                        Name: Terrence DeFranco
                                        Title: Chief Executive Officer

                                       13

<PAGE>

                               NOTICE OF EXERCISE

To: EDENTIFY, INC.

          (1) The undersigned hereby elects to purchase Warrant Shares of
Edentify, Inc. pursuant to the terms of the attached Warrant (only if exercised
in full), and tenders herewith payment of the exercise price in full, together
with all applicable transfer taxes, if any. The Warrant Subscription Allocation
is $_____________ of which $___________ remains outstanding.

          (2) Payment shall take the form of (check applicable box):

               [ ] in lawful money of the United States; or

               [ ] the cancellation of such number of Warrant Shares as is
               necessary, in accordance with the formula set forth in subsection
               2(c), to exercise this Warrant with respect to the maximum number
               of Warrant Shares purchasable pursuant to the cashless exercise
               procedure set forth in subsection 2(c).

          (3) Please issue a certificate or certificates representing said
Warrant Shares in the name of the undersigned or in such other name as is
specified below:

               -----------------------------

The Warrant Shares shall be delivered to the following:

               -----------------------------

               -----------------------------

               -----------------------------

          (4) Accredited Investor. The undersigned is an "accredited investor"
as defined in Regulation D promulgated under the Securities Act of 1933, as
amended.

[SIGNATURE OF HOLDER]

Name of Investing Entity:
                          ------------------------------------------------------

Signature of Authorized Signatory of Investing Entity:
                                                       -------------------------
Name of Authorized Signatory:
                              --------------------------------------------------
Title of Authorized Signatory:
                               -------------------------------------------------
Date:
      --------------------------------------------------------------------------

<PAGE>

                                 ASSIGNMENT FORM

                    (To assign the foregoing warrant, execute
                   this form and supply required information.
                 Do not use this form to exercise the warrant.)

          FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced
thereby are hereby assigned to

                                        whose address is
---------------------------------------
                                                        .
--------------------------------------------------------

--------------------------------------------------------

                                        Dated:               ,
                                               --------------  -------

                                        Holder's Signature:
                                                            --------------------
                                        Holder's Address:
                                                          ----------------------

                                                          ----------------------

Signature Guaranteed:
                      ----------------------------------------------------------

NOTE: The signature to this Assignment Form must correspond with the name as it
appears on the face of the Warrant, without alteration or enlargement or any
change whatsoever, and must be guaranteed by a bank or trust company. Officers
of corporations and those acting in a fiduciary or other representative capacity
should file proper evidence of authority to assign the foregoing Warrant.<PAGE>

                          REGISTRATION RIGHTS AGREEMENT

     This Registration Rights Agreement (this "Agreement") is made and entered
into as of September 29, 2006, among Edentify, Inc., a Nevada corporation (the
"Company"), and the purchasers signatory hereto (each such purchaser is a
"Purchaser" and collectively, the "Purchasers").

     This Agreement is made pursuant to the Securities Purchase Agreement, dated
as of the date hereof among the Company and the Purchasers (the "Purchase
Agreement").

     The Company and the Purchasers hereby agree as follows:

     1. Definitions

     Capitalized terms used and not otherwise defined herein that are defined in
the Purchase Agreement shall have the meanings given such terms in the Purchase
Agreement. As used in this Agreement, the following terms shall have the
following meanings:

          "Advice" shall have the meaning set forth in Section 6(d).

          "Effectiveness Date" means, with respect to the initial Registration
     Statement required to be filed hereunder, the 120th calendar day following
     the date hereof and, with respect to any additional Registration Statements
     which may be required pursuant to Section 3(c), the 120th calendar day
     following the date on which the Company first knows, or reasonably should
     have known, that such additional Registration Statement is required
     hereunder; provided, however, in the event the Company is notified by the
     Commission that one of the above Registration Statements will not be
     reviewed or is no longer subject to further review and comments, the
     Effectiveness Date as to such Registration Statement shall be the fifth
     Trading Day following the date on which the Company is so notified if such
     date precedes the dates required above.

          "Effectiveness Period" shall have the meaning set forth in Section
     2(a).

          "Event" shall have the meaning set forth in Section 2(b).

          "Event Date" shall have the meaning set forth in Section 2(b).

          "Filing Date" means, with respect to the initial Registration
     Statement required hereunder, the 60th calendar day following the date
     hereof and, with respect to any additional Registration Statements which
     may be required pursuant to Section 3(c), the 30th day following the date
     on which the Company first knows, or reasonably should have known that such
     additional Registration Statement is required hereunder.

                                        1

<PAGE>

          "Holder" or "Holders" means the holder or holders, as the case may be,
     from time to time of Registrable Securities.

          "Indemnified Party" shall have the meaning set forth in Section 5(c).

          "Indemnifying Party" shall have the meaning set forth in Section 5(c).

          "Losses" shall have the meaning set forth in Section 5(a).

          "Plan of Distribution" shall have the meaning set forth in Section
     2(a).

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

          "Prospectus" means the prospectus included in a Registration Statement
     (including, without limitation, a prospectus that includes any information
     previously omitted from a prospectus filed as part of an effective
     registration statement in reliance upon Rule 430A promulgated under the
     Securities Act), as amended or supplemented by any prospectus supplement,
     with respect to the terms of the offering of any portion of the Registrable
     Securities covered by a Registration Statement, and all other amendments
     and supplements to the Prospectus, including post-effective amendments, and
     all material incorporated by reference or deemed to be incorporated by
     reference in such Prospectus.

          "Registrable Securities" means (i) all of the shares of Common Stock
     issuable upon conversion in full of the Debentures, (ii) all shares
     issuable as interest on the Debentures assuming all permissible interest
     payments are made in shares of Common Stock and the Debentures are held
     until maturity, (iii) all Warrant Shares and (iv) any securities issued or
     issuable upon any stock split, dividend or other distribution,
     recapitalization or similar event with respect to the foregoing.

          "Registration Statement" means the registration statements required to
     be filed hereunder and any additional registration statements contemplated
     by Section 3(c), including (in each case) the Prospectus, amendments and
     supplements to such registration statement or Prospectus, including pre-
     and post-effective amendments, all exhibits thereto, and all material
     incorporated by reference or deemed to be incorporated by reference in such
     registration statement.

          "Rule 415" means Rule 415 promulgated by the Commission pursuant to
     the Securities Act, as such Rule may be amended from time to time, or any
     similar rule or regulation hereafter adopted by the Commission having
     substantially the same purpose and effect as such Rule.

          "Rule 424" means Rule 424 promulgated by the Commission pursuant to
     the Securities Act, as such Rule may be amended from time to time, or any
     similar rule or

                                        2

<PAGE>

     regulation hereafter adopted by the Commission having substantially the
     same purpose and effect as such Rule.

          "Selling Shareholder Questionnaire" shall have the meaning set forth
     in Section 3(a).

     2. Shelf Registration

     (a) On or prior to each Filing Date, the Company shall prepare and file
with the Commission a "Shelf" Registration Statement covering the resale of 125%
of the Registrable Securities on such Filing Date for an offering to be made on
a continuous basis pursuant to Rule 415. The Registration Statement shall be on
Form S-3 (except if the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith) and shall contain (unless
otherwise directed by the Holders) substantially the "Plan of Distribution"
attached hereto as Annex A. Subject to the terms of this Agreement, the Company
shall use its best efforts to cause the Registration Statement to be declared
effective under the Securities Act as promptly as possible after the filing
thereof, but in any event prior to the applicable Effectiveness Date, and shall
use its best efforts to keep such Registration Statement continuously effective
under the Securities Act until all Registrable Securities covered by such
Registration Statement have been sold or may be sold without volume restrictions
pursuant to Rule 144(k) as determined by the counsel to the Company pursuant to
a written opinion letter to such effect, addressed and acceptable to the
Company's transfer agent and the affected Holders (the "Effectiveness Period").
The Company shall immediately notify the Holders via facsimile of the
effectiveness of the Registration Statement on the same day that the Company
receives notification of the effectiveness from the Commission. Failure to so
notify the Holder within 1 Trading Day of such notification shall be deemed an
Event under Section 2(b).

     (b) If: (i) a Registration Statement is not filed on or prior to its Filing
Date (if the Company files a Registration Statement without affording the
Holders the opportunity to review and comment on the same as required by Section
3(a), the Company shall not be deemed to have satisfied this clause (i)), or
(ii) the Company fails to file with the Commission a request for acceleration in
accordance with Rule 461 promulgated under the Securities Act, within five
Trading Days of the date that the Company is notified (orally or in writing,
whichever is earlier) by the Commission that a Registration Statement will not
be "reviewed," or not subject to further review, or (iii) prior to its
Effectiveness Date, the Company fails to file a pre-effective amendment and
otherwise respond in writing to comments made by the Commission in respect of
such Registration Statement within 10 calendar days after the receipt of
comments by or notice from the Commission that such amendment is required in
order for a Registration Statement to be declared effective, or (iv) a
Registration Statement filed or required to be filed hereunder is not declared
effective by the Commission by its Effectiveness Date, or (v) after the
Effectiveness Date, a Registration Statement ceases for any reason to remain
continuously effective as to all Registrable Securities for which it is required
to be effective, or the Holders are not permitted to utilize the Prospectus
therein to resell such Registrable Securities for 10 consecutive calendar days
but no more than an aggregate of 15 calendar days during any 12-month period
(which need not be consecutive Trading Days) (any such failure or breach being

                                        3

<PAGE>

referred to as an "Event", and for purposes of clause (i) or (iv) the date on
which such Event occurs, or for purposes of clause (ii) the date on which such
five Trading Day period is exceeded, or for purposes of clause (iii) the date
which such 10 calendar day period is exceeded, or for purposes of clause (v) the
date on which such 10 or 15 calendar day period, as applicable, is exceeded
being referred to as "Event Date"), then in addition to any other rights the
Holders may have hereunder or under applicable law, on each such Event Date and
on each monthly anniversary of each such Event Date (if the applicable Event
shall not have been cured by such date) until the applicable Event is cured, the
Company shall pay to each Holder an amount in cash, as partial liquidated
damages and not as a penalty, equal to 1% of the aggregate purchase price paid
by such Holder pursuant to the Purchase Agreement for any Registrable Securities
then held by such Holder for the first 30 days during the occurrence of an Event
and 1.5% for each month thereafter. If the Company fails to pay any partial
liquidated damages pursuant to this Section in full within seven days after the
date payable, the Company will pay interest thereon at a rate of 18% per annum
(or such lesser maximum amount that is permitted to be paid by applicable law)
to the Holder, accruing daily from the date such partial liquidated damages are
due until such amounts, plus all such interest thereon, are paid in full. The
partial liquidated damages pursuant to the terms hereof shall apply on a daily
pro-rata basis for any portion of a month prior to the cure of an Event.

     3. Registration Procedures

     In connection with the Company's registration obligations hereunder, the
Company shall:

     (a) Not less than five Trading Days prior to the filing of each
Registration Statement or any related Prospectus or any amendment or supplement
thereto (including any document that would be incorporated or deemed to be
incorporated therein by reference), the Company shall, (i) furnish to each
Holder copies of all such documents proposed to be filed, which documents (other
than those incorporated or deemed to be incorporated by reference) will be
subject to the review of such Holders, and (ii) cause its officers and
directors, counsel and independent certified public accountants to respond to
such inquiries as shall be necessary, in the reasonable opinion of respective
counsel to conduct a reasonable investigation within the meaning of the
Securities Act. The Company shall not file the Registration Statement or any
such Prospectus or any amendments or supplements thereto to which the Holders of
a majority of the Registrable Securities shall reasonably object in good faith,
provided that, the Company is notified of such objection in writing no later
than 5 Trading Days after the Holders have been so furnished copies of such
documents. Each Holder agrees to furnish to the Company a completed
Questionnaire in the form attached to this Agreement as Annex B (a "Selling
Shareholder Questionnaire") not less than two Trading Days prior to the Filing
Date or by the end of the fourth Trading Day following the date on which such
Holder receives draft materials in accordance with this Section.

     (b) (i) Prepare and file with the Commission such amendments, including
post-effective amendments, to a Registration Statement and the Prospectus used
in connection therewith as may be necessary to keep a Registration Statement
continuously effective as to the applicable Registrable Securities for the
Effectiveness Period and prepare and file with the Commission such additional
Registration Statements in order to register for resale under the

                                        4

<PAGE>

Securities Act all of the Registrable Securities; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement
(subject to the terms of this Agreement), and as so supplemented or amended to
be filed pursuant to Rule 424; (iii) respond as promptly as reasonably possible
to any comments received from the Commission with respect to a Registration
Statement or any amendment thereto and as promptly as reasonably possible
provide the Holders true and complete copies of all correspondence from and to
the Commission relating to a Registration Statement; and (iv) comply in all
material respects with the provisions of the Securities Act and the Exchange Act
with respect to the disposition of all Registrable Securities covered by a
Registration Statement during the applicable period in accordance (subject to
the terms of this Agreement) with the intended methods of disposition by the
Holders thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented.

     (c) If during the Effectiveness Period, the number of Registrable
Securities at any time exceeds 90% of the number of shares of Common Stock then
registered in a Registration Statement, then the Company shall file as soon as
reasonably practicable but in any case prior to the applicable Filing Date, an
additional Registration Statement covering the resale by the Holders of not less
than [125% of the number of such Registrable Securities.

     (d) Notify the Holders of Registrable Securities to be sold (which notice
shall, pursuant to clauses (ii) through (vi) hereof, be accompanied by an
instruction to suspend the use of the Prospectus until the requisite changes
have been made) as promptly as reasonably possible (and, in the case of (i)(A)
below, not less than five Trading Days prior to such filing) and (if requested
by any such Person) confirm such notice in writing no later than one Trading Day
following the day (i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment to a Registration Statement is proposed to be filed;
(B) when the Commission notifies the Company whether there will be a "review" of
such Registration Statement and whenever the Commission comments in writing on
such Registration Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders); and (C) with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective; (ii) of any request by the Commission or any other
Federal or state governmental authority for amendments or supplements to a
Registration Statement or Prospectus or for additional information; (iii) of the
issuance by the Commission or any other federal or state governmental authority
of any stop order suspending the effectiveness of a Registration Statement
covering any or all of the Registrable Securities or the initiation of any
Proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any Proceeding for such
purpose; (v) of the occurrence of any event or passage of time that makes the
financial statements included in a Registration Statement ineligible for
inclusion therein or any statement made in a Registration Statement or
Prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to a
Registration Statement, Prospectus or other documents so that, in the case of a
Registration Statement or the Prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not

                                        5

<PAGE>

misleading; and (vi) the occurrence or existence of any pending corporate
development with respect to the Company that the Company believes may be
material and that, in the determination of the Company, makes it not in the best
interest of the Company to allow continued availability of the Registration
Statement or Prospectus; provided that any and all of such information shall
remain confidential to each Holder until such information otherwise becomes
public, unless disclosure by a Holder is required by law; provided, further,
notwithstanding each Holder's agreement to keep such information confidential,
the Holders make no acknowledgement that any such information is material,
non-public information.

     (e) Use its best efforts to avoid the issuance of, or, if issued, obtain
the withdrawal of (i) any order suspending the effectiveness of a Registration
Statement, or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable moment.

     (f) Furnish to each Holder, without charge, at least one conformed copy of
each such Registration Statement and each amendment thereto, including financial
statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference to the extent requested by such Person, and
all exhibits to the extent requested by such Person (including those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.

     (g) Promptly deliver to each Holder, without charge, as many copies of the
Prospectus or Prospectuses (including each form of prospectus) and each
amendment or supplement thereto as such Persons may reasonably request in
connection with resales by the Holder of Registrable Securities. Subject to the
terms of this Agreement, the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders in connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any amendment or supplement thereto, except after
the giving on any notice pursuant to Section 3(d).

     (h) If NASDR Rule 2710 requires any broker-dealer to make a filing prior to
executing a sale by a Holder, make an Issuer Filing with the NASDR, Inc.
Corporate Financing Department pursuant to NASDR Rule 2710(b)(10)(A)(i) and
respond within five Trading Days to any comments received from NASDR in
connection therewith, and pay the filing fee required in connection therewith.

     (i) Prior to any resale of Registrable Securities by a Holder, use its
commercially reasonable efforts to register or qualify or cooperate with the
selling Holders in connection with the registration or qualification (or
exemption from the Registration or qualification) of such Registrable Securities
for the resale by the Holder under the securities or Blue Sky laws of such
jurisdictions within the United States as any Holder reasonably requests in
writing, to keep each registration or qualification (or exemption therefrom)
effective during the Effectiveness Period and to do any and all other acts or
things reasonably necessary to enable the disposition in such jurisdictions of
the Registrable Securities covered by each Registration Statement; provided,
that the Company shall not be required to qualify generally to do business in
any jurisdiction where it

                                        6

<PAGE>

is not then so qualified, subject the Company to any material tax in any such
jurisdiction where it is not then so subject or file a general consent to
service of process in any such jurisdiction.

     (j) If requested by the Holders, cooperate with the Holders to facilitate
the timely preparation and delivery of certificates representing Registrable
Securities to be delivered to a transferee pursuant to a Registration Statement,
which certificates shall be free, to the extent permitted by the Purchase
Agreement, of all restrictive legends, and to enable such Registrable Securities
to be in such denominations and registered in such names as any such Holders may
request.

     (k) Upon the occurrence of any event contemplated by this Section 3, as
promptly as reasonably possible under the circumstances taking into account the
Company's good faith assessment of any adverse consequences to the Company and
its stockholders of the premature disclosure of such event, prepare a supplement
or amendment, including a post-effective amendment, to a Registration Statement
or a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Company notifies the Holders in accordance with clauses
(ii) through (vi) of Section 3(d) above to suspend the use of any Prospectus
until the requisite changes to such Prospectus have been made, then the Holders
shall suspend use of such Prospectus. The Company will use its best efforts to
ensure that the use of the Prospectus may be resumed as promptly as is
practicable. The Company shall be entitled to exercise its right under this
Section 3(j) to suspend the availability of a Registration Statement and
Prospectus, subject to the payment of partial liquidated damages pursuant to
Section 2(b), for a period not to exceed 60 days (which need not be consecutive
days) in any 12 month period.

     (l) Comply with all applicable rules and regulations of the Commission.

     (m) The Company may require each selling Holder to furnish to the Company a
certified statement as to the number of shares of Common Stock beneficially
owned by such Holder and, if required by the Commission, the person thereof that
has voting and dispositive control over the Shares. During any periods that the
Company is unable to meet its obligations hereunder with respect to the
registration of the Registrable Securities solely because any Holder fails to
furnish such information within three Trading Days of the Company's request, any
liquidated damages that are accruing at such time as to such Holder only shall
be tolled and any Event that may otherwise occur solely because of such delay
shall be suspended as to such Holder only, until such information is delivered
to the Company.

     4. Registration Expenses. All fees and expenses incident to the performance
of or compliance with this Agreement by the Company shall be borne by the
Company whether or not any Registrable Securities are sold pursuant to the
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to

                                        7

<PAGE>

be made with the Trading Market on which the Common Stock is then listed for
trading, (B) in compliance with applicable state securities or Blue Sky laws
reasonably agreed to by the Company in writing (including, without limitation,
fees and disbursements of counsel for the Company in connection with Blue Sky
qualifications or exemptions of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as requested by the Holders) and (C) if not previously paid
by the Company in connection with an Issuer Filing, with respect to any filing
that may be required to be made by any broker through which a Holder intends to
make sales of Registrable Securities with NASD Regulation, Inc. pursuant to the
NASD Rule 2710, so long as the broker is receiving no more than a customary
brokerage commission in connection with such sale, (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses if the printing of
prospectuses is reasonably requested by the holders of a majority of the
Registrable Securities included in a Registration Statement), (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the
Company, (v) Securities Act liability insurance, if the Company so desires such
insurance, and (vi) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated by
this Agreement. In addition, the Company shall be responsible for all of its
internal expenses incurred in connection with the consummation of the
transactions contemplated by this Agreement (including, without limitation, all
salaries and expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit and the fees and expenses
incurred in connection with the listing of the Registrable Securities on any
securities exchange as required hereunder. In no event shall the Company be
responsible for any broker or similar commissions or, except to the extent
provided for in the Transaction Documents, any legal fees or other costs of the
Holders.

     5. Indemnification

     (a) Indemnification by the Company. The Company shall, notwithstanding any
termination of this Agreement, indemnify and hold harmless each Holder, the
officers, directors, agents, brokers (including brokers who offer and sell
Registrable Securities as principal as a result of a pledge or any failure to
perform under a margin call of Common Stock), investment advisors and employees
of each of them, each Person who controls any such Holder (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) and the
officers, directors, agents and employees of each such controlling Person, to
the fullest extent permitted by applicable law, from and against any and all
losses, claims, damages, liabilities, costs (including, without limitation,
reasonable attorneys' fees) and expenses (collectively, "Losses"), as incurred,
arising out of or relating to any untrue or alleged untrue statement of a
material fact contained in a Registration Statement, any Prospectus or any form
of prospectus or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of
a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading, except to the extent, but only to the extent, that (i) such
untrue statements or omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such Holder expressly for use
therein, or to the extent that such information relates to such Holder or such
Holder's proposed method of distribution of Registrable Securities and was
reviewed and

                                        8

<PAGE>

expressly approved in writing by such Holder expressly for use in a Registration
Statement, such Prospectus or such form of Prospectus or in any amendment or
supplement thereto (it being understood that the Holder has approved Annex A
hereto for this purpose) or (ii) in the case of an occurrence of an event of the
type specified in Section 3(d)(ii)-(vi), the use by such Holder of an outdated
or defective Prospectus after the Company has notified such Holder in writing
that the Prospectus is outdated or defective and prior to the receipt by such
Holder of the Advice contemplated in Section 6(d). The Company shall notify the
Holders promptly of the institution, threat or assertion of any Proceeding
arising from or in connection with the transactions contemplated by this
Agreement of which the Company is aware.

     (b) Indemnification by Holders. Each Holder shall, severally and not
jointly, indemnify and hold harmless the Company, its directors, officers,
agents and employees, each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses, as
incurred, to the extent arising out of or based solely upon: (x) such Holder's
failure to comply with the prospectus delivery requirements of the Securities
Act or (y) any untrue or alleged untrue statement of a material fact contained
in any Registration Statement, any Prospectus, or any form of prospectus, or in
any amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading (i) to the extent, but only to the extent, that such untrue statement
or omission is contained in any information so furnished in writing by such
Holder to the Company specifically for inclusion in such Registration Statement
or such Prospectus or (ii) to the extent that (1) such untrue statements or
omissions are based solely upon information regarding such Holder furnished in
writing to the Company by such Holder expressly for use therein, or to the
extent that such information relates to such Holder or such Holder's proposed
method of distribution of Registrable Securities and was reviewed and expressly
approved in writing by such Holder expressly for use in the Registration
Statement (it being understood that the Holder has approved Annex A hereto for
this purpose), such Prospectus or such form of Prospectus or in any amendment or
supplement thereto or (2) in the case of an occurrence of an event of the type
specified in Section 3(d)(ii)-(vi), the use by such Holder of an outdated or
defective Prospectus after the Company has notified such Holder in writing that
the Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice contemplated in Section 6(d). In no event shall the liability of
any selling Holder hereunder be greater in amount than the dollar amount of the
net proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

     (c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any Person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party shall promptly notify the Person
from whom indemnity is sought (the "Indemnifying Party") in writing, and the
Indemnifying Party shall have the right to assume the defense thereof, including
the employment of counsel reasonably satisfactory to the Indemnified Party and
the payment of all fees and expenses incurred in connection with defense
thereof; provided, that the failure of any Indemnified Party to give such notice
shall not relieve the Indemnifying Party of its obligations or liabilities
pursuant to this Agreement, except (and only)

                                        9

<PAGE>

to the extent that it shall be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal or further review)
that such failure shall have prejudiced the Indemnifying Party.

     An Indemnified Party shall have the right to employ separate counsel in any
such Proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party or
Parties unless: (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (3) the named
parties to any such Proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall reasonably believe that a material conflict of interest is likely to exist
if the same counsel were to represent such Indemnified Party and the
Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and the reasonable fees and expenses of one
separate counsel shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding in respect of
which any Indemnified Party is a party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Proceeding.

     Subject to the terms of this Agreement, all reasonable fees and expenses of
the Indemnified Party (including reasonable fees and expenses to the extent
incurred in connection with investigating or preparing to defend such Proceeding
in a manner not inconsistent with this Section) shall be paid to the Indemnified
Party, as incurred, within ten Trading Days of written notice thereof to the
Indemnifying Party; provided, that the Indemnified Party shall promptly
reimburse the Indemnifying Party for that portion of such fees and expenses
applicable to such actions for which such Indemnified Party is not entitled to
indemnification hereunder, determined based upon the relative faults of the
parties.

     (d) Contribution. If the indemnification under Section 5(a) or 5(b) is
unavailable to an Indemnified Party or insufficient to hold an Indemnified Party
harmless for any Losses, then each Indemnifying Party shall contribute to the
amount paid or payable by such Indemnified Party, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in this Agreement, any

                                       10

<PAGE>

reasonable attorneys' or other reasonable fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms.

     The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission, except in the case of fraud by
such Holder.

     The indemnity and contribution agreements contained in this Section are in
addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

     6. Miscellaneous

     (a) Remedies. In the event of a breach by the Company or by a Holder, of
any of their obligations under this Agreement, each Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights granted by
law and under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement. The Company and each
Holder agree that monetary damages would not provide adequate compensation for
any losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.

     (b) No Piggyback on Registrations. Neither the Company nor any of its
security holders (other than the Holders in such capacity pursuant hereto) may
include securities of the Company in the Registration Statement other than the
Registrable Securities. The Company shall not file any other registration
statements until the initial Registration Statement required hereunder is
declared effective by the Commission, provided that this Section 6(b) shall not
prohibit the Company from filing amendments to registration statements already
filed.

     (c) Compliance. Each Holder covenants and agrees that it will comply with
the prospectus delivery requirements of the Securities Act as applicable to it
in connection with sales of Registrable Securities pursuant to the Registration
Statement.

     (d) Discontinued Disposition. Each Holder agrees by its acquisition of such
Registrable Securities that, upon receipt of a notice from the Company of the
occurrence of any event of the kind described in Section 3(d), such Holder will
forthwith discontinue disposition of such Registrable Securities under a
Registration Statement until such Holder's receipt of the copies of the
supplemented Prospectus and/or amended Registration Statement, or until it is

                                       11

<PAGE>

advised in writing (the "Advice") by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any
additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company will use its best efforts to ensure that the use of the Prospectus may
be resumed as promptly as it practicable. The Company agrees and acknowledges
that any periods during which the Holder is required to discontinue the
disposition of the Registrable Securities hereunder shall be subject to the
provisions of Section 2(b).

     (e) Piggy-Back Registrations. If at any time during the Effectiveness
Period there is not an effective Registration Statement covering all of the
Registrable Securities and the Company shall determine to prepare and file with
the Commission a registration statement relating to an offering for its own
account or the account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under the
Securities Act) or their then equivalents relating to equity securities to be
issued solely in connection with any acquisition of any entity or business or
equity securities issuable in connection with the stock option or other employee
benefit plans, then the Company shall send to each Holder a written notice of
such determination and, if within fifteen days after the date of such notice,
any such Holder shall so request in writing, the Company shall include in such
registration statement all or any part of such Registrable Securities such
holder requests to be registered; provided, that, the Company shall not be
required to register any Registrable Securities pursuant to this Section 6(e)
that are eligible for resale pursuant to Rule 144(k) promulgated under the
Securities Act or that are the subject of a then effective Registration
Statement.

     (f) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the same shall be in writing and signed by the Company and each Holder of
the then outstanding Registrable Securities. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders and that does not directly or
indirectly affect the rights of other Holders may be given by Holders of all of
the Registrable Securities to which such waiver or consent relates; provided,
however, that the provisions of this sentence may not be amended, modified, or
supplemented except in accordance with the provisions of the immediately
preceding sentence.

     (g) Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be delivered as set forth
in the Purchase Agreement.

     (h) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and permitted assigns of each of the parties
and shall inure to the benefit of each Holder. The Company may not assign its
rights or obligations hereunder without the prior written consent of all of the
Holders of the then-outstanding Registrable Securities. Each Holder may assign
their respective rights hereunder in the manner and to the Persons as permitted
under the Purchase Agreement. Any Public Liquidity Company that is not the
Company shall, as a condition to any Public Liquidity Event, agree to, and be
bound by, all the terms, conditions and obligations set forth hereunder.

                                       12

<PAGE>

     (i) No Inconsistent Agreements. Neither the Company nor any of its
subsidiaries has entered, as of the date hereof, nor shall the Company or any of
its subsidiaries, on or after the date of this Agreement, enter into any
agreement with respect to its securities, that would have the effect of
impairing the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof. Except as set forth on Schedule 6(i),
neither the Company nor any of its subsidiaries has previously entered into any
agreement granting any registration rights with respect to any of its securities
to any Person that have not been satisfied in full.

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

     (k) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be determined with the
provisions of the Purchase Agreement.

     (l) Cumulative Remedies. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law.

     (m) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.

     (n) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

     (o) Independent Nature of Holders' Obligations and Rights. The obligations
of each Holder hereunder are several and not joint with the obligations of any
other Holder hereunder, and no Holder shall be responsible in any way for the
performance of the obligations of any other Holder hereunder. Nothing contained
herein or in any other agreement or document delivered at any closing, and no
action taken by any Holder pursuant hereto or thereto, shall be deemed to
constitute the Holders as a partnership, an association, a joint venture or any
other kind of entity, or create a presumption that the Holders are in any way
acting in concert with respect to such obligations or the transactions
contemplated by this Agreement. Each Holder shall be entitled to protect and
enforce its rights, including without limitation the rights arising

                                       13

<PAGE>

out of this Agreement, and it shall not be necessary for any other Holder to be
joined as an additional party in any proceeding for such purpose.

                              ********************

                                       14

<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.

                                        EDENTIFY, INC.

                                        By: /s/ Terrence DeFranco
                                            ------------------------------------
                                        Name: Terrence DeFranco
                                        Title: Chief Executive Officer

                       [SIGNATURE PAGE OF HOLDERS FOLLOWS]

                                       15

<PAGE>

                   [SIGNATURE PAGE OF HOLDERS TO EDENTIFY RRA]

Name of Holder: Bushido Capital Master Fund, L.P.
                ---------------------------------

Signature of Authorized Signatory of Holder: /s/ Christopher Rossman
                                             --------------------------
Name of Authorized Signatory: Christopher Rossman
                              -------------------------
Title of Authorized Signatory: Director
                               ------------------------

                           [SIGNATURE PAGES CONTINUE]

                                       16

<PAGE>

                              Plan of Distribution

     Each Selling Stockholder (the "Selling Stockholders") of the common stock
("Common Stock") of [_______, a [______ corporation (the "Company") and any of
their pledgees, assignees and successors-in-interest may, from time to time,
sell any or all of their shares of Common Stock on the Trading Market or any
other stock exchange, market or trading facility on which the shares are traded
or in private transactions. These sales may be at fixed or negotiated prices. A
Selling Stockholder may use any one or more of the following methods when
selling shares:

          -    ordinary brokerage transactions and transactions in which the
               broker-dealer solicits purchasers;

          -    block trades in which the broker-dealer will attempt to sell the
               shares as agent but may position and resell a portion of the
               block as principal to facilitate the transaction;

          -    purchases by a broker-dealer as principal and resale by the
               broker-dealer for its account;

          -    an exchange distribution in accordance with the rules of the
               applicable exchange;

          -    privately negotiated transactions;

          -    settlement of short sales entered into after the date of this
               prospectus;

          -    broker-dealers may agree with the Selling Stockholders to sell a
               specified number of such shares at a stipulated price per share;

          -    a combination of any such methods of sale;

          -    through the writing or settlement of options or other hedging
               transactions, whether through an options exchange or otherwise;
               or

          -    any other method permitted pursuant to applicable law.

     The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the "Securities Act"), if available, rather
than under this prospectus.

     Broker-dealers engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NADSR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.

                                       17

<PAGE>

     In connection with the sale of the Common Stock or interests therein, the
Selling Stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
Common Stock in the course of hedging the positions they assume. The Selling
Stockholders may also sell shares of the Common Stock short and deliver these
securities to close out their short positions, or loan or pledge the Common
Stock to broker-dealers that in turn may sell these securities. The Selling
Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

     The Selling Stockholders and any broker-dealers or agents that are involved
in selling the shares may be deemed to be "underwriters" within the meaning of
the Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act. Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In no
event shall any broker-dealer receive fees, commissions and markups which, in
the aggregate, would exceed eight percent (8%).

     The Company is required to pay certain fees and expenses incurred by the
Company incident to the registration of the shares. The Company has agreed to
indemnify the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.

     Because Selling Stockholders may be deemed to be "underwriters" within the
meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act. In addition, any securities covered by this
prospectus which qualify for sale pursuant to Rule 144 under the Securities Act
may be sold under Rule 144 rather than under this prospectus. Each Selling
Stockholder has advised us that they have not entered into any written or oral
agreements, understandings or arrangements with any underwriter or broker-dealer
regarding the sale of the resale shares. There is no underwriter or coordinating
broker acting in connection with the proposed sale of the resale shares by the
Selling Stockholders.

     We agreed to keep this prospectus effective until the earlier of (i) the
date on which the shares may be resold by the Selling Stockholders without
registration and without regard to any volume limitations by reason of Rule
144(e) under the Securities Act or any other rule of similar effect or (ii) all
of the shares have been sold pursuant to the prospectus or Rule 144 under the
Securities Act or any other rule of similar effect. The resale shares will be
sold only through registered or licensed brokers or dealers if required under
applicable state securities laws. In addition, in certain states, the resale
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.

                                       18

<PAGE>

     Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to the Common Stock for a period of two
business days prior to the commencement of the distribution. In addition, the
Selling Stockholders will be subject to applicable provisions of the Exchange
Act and the rules and regulations thereunder, including Regulation M, which may
limit the timing of purchases and sales of shares of the Common Stock by the
Selling Stockholders or any other person. We will make copies of this prospectus
available to the Selling Stockholders and have informed them of the need to
deliver a copy of this prospectus to each purchaser at or prior to the time of
the sale.

                                       19

<PAGE>

                                                                         ANNEX B

                                [________________

                 SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE

     The undersigned beneficial owner of common stock, par value $[______ per
share (the "Common Stock"), of [_______, a [_______ corporation (the "Company"),
(the "Registrable Securities") understands that the Company has filed or intends
to file with the Securities and Exchange Commission (the "Commission") a
registration statement on Form S-3 (the "Registration Statement") for the
registration and resale under Rule 415 of the Securities Act of 1933, as amended
(the "Securities Act"), of the Registrable Securities, in accordance with the
terms of the Registration Rights Agreement, dated as of [____ (the "Registration
Rights Agreement"), among the Company and the Purchasers named therein. A copy
of the Registration Rights Agreement is available from the Company upon request
at the address set forth below. All capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Registration Rights
Agreement.

     Certain legal consequences arise from being named as a selling
securityholder in the Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling securityholder in the Registration
Statement and the related prospectus.

                                     NOTICE

     The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby elects to include the Registrable Securities owned
by it and listed below in Item 3 (unless otherwise specified under such Item 3)
in the Registration Statement.

                                       20

<PAGE>

The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:

                                  QUESTIONNAIRE

1.   NAME.

     (a)  Full Legal Name of Selling Securityholder

          ----------------------------------------------------------------------

     (b)  Full Legal Name of Registered Holder (if not the same as (a) above)
          through which Registrable Securities Listed in Item 3 below are held:

          ----------------------------------------------------------------------

     (c)  Full Legal Name of Natural Control Person (which means a natural
          person who directly you indirectly alone or with others has power to
          vote or dispose of the securities covered by the questionnaire):

          ----------------------------------------------------------------------

2.   ADDRESS FOR NOTICES TO SELLING SECURITYHOLDER:

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Telephone:
           ---------------------------------------------------------------------
Fax:
     ---------------------------------------------------------------------------
Contact Person:
                ----------------------------------------------------------------

3.   BENEFICIAL OWNERSHIP OF REGISTRABLE SECURITIES:

     (a)  Type and Principal Amount of Registrable Securities beneficially
          owned:

          ----------------------------------------------------------------------

          ----------------------------------------------------------------------

          ----------------------------------------------------------------------

                                       21

<PAGE>

4.   BROKER-DEALER STATUS:

     (a)  Are you a broker-dealer?

                                 Yes [ ] No [ ]

     Note: If yes, the Commission's staff has indicated that you should be
           identified as an underwriter in the Registration Statement.

     (b)  Are you an affiliate of a broker-dealer?

                                 Yes [ ] No [ ]

     (c)  If you are an affiliate of a broker-dealer, do you certify that you
          bought the Registrable Securities in the ordinary course of business,
          and at the time of the purchase of the Registrable Securities to be
          resold, you had no agreements or understandings, directly or
          indirectly, with any person to distribute the Registrable Securities?

                                 Yes [ ] No [ ]

     Note: If no, the Commission's staff has indicated that you should be
           identified as an underwriter in the Registration Statement.

5.   BENEFICIAL OWNERSHIP OF OTHER SECURITIES OF THE COMPANY OWNED BY THE
     SELLING SECURITYHOLDER.

     Except as set forth below in this Item 5, the undersigned is not the
     beneficial or registered owner of any securities of the Company other than
     the Registrable Securities listed above in Item 3.

     (a)  Type and Amount of Other Securities beneficially owned by the Selling
          Securityholder:

          ----------------------------------------------------------------------

          ----------------------------------------------------------------------

                                       22

<PAGE>

6.   RELATIONSHIPS WITH THE COMPANY:

     Except as set forth below, neither the undersigned nor any of its
     affiliates, officers, directors or principal equity holders (owners of 5%
     of more of the equity securities of the undersigned) has held any position
     or office or has had any other material relationship with the Company (or
     its predecessors or affiliates) during the past three years.

     State any exceptions here:

     ---------------------------------------------------------------------------

     ---------------------------------------------------------------------------

     The undersigned agrees to promptly notify the Company of any inaccuracies
or changes in the information provided herein that may occur subsequent to the
date hereof at any time while the Registration Statement remains effective.

     By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to Items 1 through 6 and the
inclusion of such information in the Registration Statement and the related
prospectus. The undersigned understands that such information will be relied
upon by the Company in connection with the preparation or amendment of the
Registration Statement and the related prospectus.

     IN WITNESS WHEREOF the undersigned, by authority duly given, has caused
this Notice and Questionnaire to be executed and delivered either in person or
by its duly authorized agent.

Dated:                                  Beneficial Owner:
       ------------------------------                     ----------------------

                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

PLEASE FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND
RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:

                                       23

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