Document:

EQUIPMENT
      LEASE

    

    This
      Equipment Lease (this "Lease") is made effective as of September 15, 2004,
      between Mark Trimble (the "Lessor"), 5150 Franz Rd. Suite 100, Katy, TX 77493,
      and The Jon Ashton Corporation (the "Lessee"), 5150 Franz Rd. Suite 100, Katy,
      Tx 77493, and states the agreement of the parties as follows:

    

    EQUIPMENT
      SUBJECT TO LEASE.
      The
      Lessor shall lease the equipment listed on the attached Exhibit
      "A".

    

    PAYMENT
      TERMS. The
      Lessee shall make 36 payments of $625.00 each, for a total amount of $22,500.00.
      Payments shall be due on the fifteenth day of each month, with the first payment
      due on October 15, 2004. The lease payments shall be due whether or not the
      Lessee has received notice of a payment due.

    

    NON-SUFFICIENT
      FUNDS.
      The
      Lessee shall be charged $25.00 for each check that is returned to the Lessor
      for
      lack of sufficient funds.

    

    LEASE
      TERM.
      This
      Lease shall begin on the above effective date and shall terminate on September
      15, 2007, unless otherwise terminated in a manner consistent with the terms
      of
      this Lease.

    

    CARE
      AND OPERATION OF EQUIPMENT.
      The
      equipment may only be used and operated in a careful and proper manner. Its
      use
      must comply with all laws, ordinances, and regulations relating to the
      possession, use, or maintenance of the equipment, including registration and/or
      licensing requirements, if any.

    

    MAINTENANCE
      AND REPAIR. The
      Lessee shall maintain at the Lessee's cost, the equipment in good repair and
      operating condition, allowing for reasonable wear and tear. Such costs shall
      include labor, material, parts, and similar items.

    

    LESSOR'S
      RIGHT OF INSPECTION.
      The
      Lessor shall have the right to inspect the equipment during Lessee's normal
      business hours.

    

    RETURN
      OF EQUIPMENT.
      At the
      end of the Lease term, the Lessee shall be obligated to return the equipment
      to
      the Lessor at the Lessee's expense.

    

    OPTION
      TO RENEW.
      If the
      Lessee is not in default upon the expiration of this lease, the Lessee shall
      have the option to renew this Lease for a similar term on such terms as the
      parties may agree at the time of such renewal.

    

    ACCEPTANCE
      OF EQUIPMENT.
      The
      Lessee shall inspect each item of equipment delivered pursuant to this Lease.
      The Lessee shall immediately notify the Lessor of any discrepancies between
      such
      item of equipment and the description of the equipment in the Equipment
      Schedule. If the Lessee fails to provide such notice before accepting delivery
      of the equipment, the Lessee will be conclusively presumed to have accepted
      the
      equipment as specified in the Equipment Schedule.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    OWNERSHIP
      AND STATUS OF EQUIPMENT.
      The
      equipment will be deemed to be personal property, regardless of the manner
      in
      which it may be attached to any other property. The Lessor shall be deemed
      to
      have retained title to the equipment at all times, unless the Lessor transfers
      the title by sale. The Lessee shall immediately advise the Lessor regarding
      any
      notice of any claim, levy, lien, or legal process issued against the
      equipment.

    

    RISK
      OF LOSS OR DAMAGE.
      The
      Lessee assumes all risks of loss or damage to the equipment from any cause,
      and
      agrees to return it to the Lessor in the condition received from the Lessor,
      with the exception of normal wear and tear, unless otherwise provided in this
      Lease.

    

    INDEMNITY
      OF LESSOR FOR LOSS OR DAMAGES.
      Unless
      otherwise provided in this Lease, if the equipment is damaged or lost, the
      Lessor shall have the option of requiring the Lessee to repair the equipment
      to
      a state of good working order, or replace the equipment with like equipment
      in
      good repair, which equipment shall become the property of the Lessor and subject
      to this Lease.

    

    LIABILITY
      AND INDEMNITY.
      Liability for injury, disability, and death of workers and other persons caused
      by operating, handling, or transporting the equipment during the term of this
      Lease is the obligation of the Lessee, and the Lessee shall indemnify and hold
      the Lessor harmless from and against all such liability. 

    

    CASUALTY
      INSURANCE.
      The
      Lessor shall be responsible to maintain casualty insurance with respect to
      loss
      or damage of the equipment.

    

    TAXES
      AND FEES.
      During
      the term of this Lease, the Lessee shall pay all applicable taxes, assessments,
      and license and registration fees on the equipment.

    

    DEFAULT.
      The
      occurrence of any of the following shall constitute a default under this
      Lease:

    

    A.
      The
      failure to make a required payment under this Lease when due.

    

    B.
      The
      violation of any other provision or requirement that is not corrected within
      30
      day(s) after written notice of the violation is given.

    

    C.
      The
      insolvency or bankruptcy of the Lessee.

    

    D.
      The
      subjection of any of Lessee's property to any levy, seizure, assignment,
      application or sale for or by any creditor or government agency.

    

    RIGHTS
      ON DEFAULT.
      In
      addition to any other rights afforded the Lessor by law, if the Lessee is in
      default under this Lease, without notice to or demand on the Lessee, the Lessor
      may take possession of the equipment as provided by law, deduct the costs of
      recovery (including attorney fees and legal costs), repair, and related costs,
      and hold the Lessee responsible for any deficiency. The rights and remedies
      of
      the Lessor provided by law and this Agreement shall be cumulative in nature.
      The
      Lessor shall be obligated to re-lease the equipment, or otherwise mitigate
      the
      damages from the default, only as required by law.

     

    
      
        
        

      

      
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    NOTICE.
      All
      notices required or permitted under this Lease shall be deemed delivered when
      delivered in person or by mail, postage prepaid, addressed to the appropriate
      party at the address shown for that party at the beginning of this
      Lease.

    

    ASSIGNMENT.
      The
      Lessee shall not assign or sublet any interest in this Lease or the equipment
      or
      permit the equipment to be used by anyone other than the Lessee or Lessee's
      employees, without Lessor's prior written consent.

    

    ENTIRE
      AGREEMENT AND MODIFICATION.
      This
      Lease constitutes the entire agreement between the parties. No modification
      or
      amendment of this Lease shall be effective unless in writing and signed by
      both
      parties. This Lease replaces any and all prior agreements between the
      parties.

    

    GOVERNING
      LAW.
      This
      Lease shall be construed in accordance with the laws of the State of
      Texas.

    

    SEVERABILITY.
      If any
      portion of this Lease shall be held to be invalid or unenforceable for any
      reason, the remaining provisions shall continue to be valid and enforceable.
      If
      a court finds that any provision of this Lease is invalid or unenforceable,
      but
      that by limiting such provision, it would become valid and enforceable, then
      such provision shall be deemed to be written, construed, and enforced as so
      limited.

    

    WAIVER.
      The
      failure of either party to enforce any provision of this Lease shall not be
      construed as a waiver or limitation of that party's right to subsequently
      enforce and compel strict compliance with every provision of this
      Lease.

    

    CERTIFICATION.
      Lessee
      certifies that the application, statements, trade references, and financial
      reports submitted to Lessor are true and correct and any material
      misrepresentation will constitute a default under this Lease.

    

    ARBITRATION.
      Any
      controversy or claim relating to this Lease, including the construction or
      application of this Lease, will be settled by binding arbitration under the
      rules of the American Arbitration Association, and any judgment granted by
      the
      arbitrator(s) may be enforced in any court of proper jurisdiction.

     

    
      
        
        

      

      
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    Lessor:

    Mark
      Trimble

    

    

    /s/
      Mark
      Trimble

    Mark
      Trimble

    
 

    Lessee:

    The
      Jon
      Ashton Corporation

     

    
      
        	
                By:

              	
                /s/
                  John Peper

              

      

      
        	 	
                John
                  Peper

              

      

      
        	 	
                Vice
                  President

              

      

    

     

    
      
        
        

      

      
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    EXHIBIT
      A

    

    Equipment
      Schedule

    

    Equipment
      Description: 1998 Ford F150 pickup

    

    
      
        
        

      

      
        5SERIES
        A PREFERRED STOCK PURCHASE AGREEMENT

      

       

      This
        Series A Preferred Stock Purchase Agreement (the “Agreement”)
        is
        made as of the ___ day of October, 2005 by and among THE JON ASHTON CORPORATION,
        a Texas corporation (the “Company”),
        MICHAEL LONG, or his designees (each a “Purchaser”
and
        together the “Purchasers”)
        and
        the persons listed as “Founders” on the signature pages to this Agreement (each
        a “Founder”
and
        together the “Founders”).

       

      RECITALS

       

      WHEREAS,
        the Company proposes to offer and sell an aggregate of $300,000 of equity
        securities (the “Private
        Placement”),
        to
        file with the Securities and Exchange Commission a registration statement
        (the
“Registration
        Statement”)
        covering the resale of the underlying shares of common stock offered pursuant
        to
        the Private Placement and to undertake certain efforts intended to facilitate
        the establishment of a public trading market in the Company’s common stock (the
“Trading
        Market Undertakings”),
        including but not limited to preparing and filing a Form 8-A registration
        statement, preparing stock certificates, including application for CUSIP
        numbers, printing of certificates and appointment of a transfer agent, listing
        of the Company’s common stock in a standard listing manual, filing of
        appropriate blue sky registrations and notices, and identification of market
        makers and cooperation with market makers in filing of a Form 211, among
        others;
        and

       

      WHEREAS,
        the Company lacks the financial resources and expertise to carry out the
        Private
        Placement, to carry out the preparation and filing of the Registration Statement
        and to carry out the Trading Market Undertakings and desires the financial
        assistance and advise of the Purchaser in carrying out each of the Private
        Placement, the Registration Statement and the Trading Market
        Undertakings.

       

      NOW,
        THEREFORE, the parties hereby agree as follows:

       

      1.  Purchase
        and Sale of Preferred Stock.

       

      1.1.  Sale
        and Issuance of Series A Preferred Stock.
        

       

      (a)  The
        Company shall adopt and file with the Secretary of State of the State of
        Texas
        on or before the Closing (as defined below) the Amended and Restated Articles
        of
        Incorporation in the form of Exhibit A
        attached
        to this Agreement (the “Restated
        Articles”)
        and
        the Certificate of Designation in the form of Exhibit
        B
        attached
        to this Agreement (the “Series
        A Certificate of Designation”).
        

       

      (b)  Subject
        to the terms and conditions of this Agreement, each Purchaser agrees to purchase
        at the Closing, and the Company agrees to sell and issue to each Purchaser
        at
        the Closing, an aggregate of 6,000,000 shares of Series A Preferred Stock,
        to be allocated among the Purchasers in the manner set forth opposite each
        Purchaser’s name on Exhibit C
        for the
        Purchase Price, as defined below. The shares of Series A Preferred Stock
        issued to the Purchasers pursuant to this Agreement shall be referred to
        in this
        Agreement as the “Shares.”

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (c)  As
        consideration for the Shares, the Purchaser has paid certain costs and expenses,
        and agrees to pay all additional costs and expenses up to but not exceeding
        $300,000 in the aggregate (including but not limited to legal fees, accounting
        fees, filing fees, printing costs, among others), associated with the Private
        Placement, the Registration Statement and the Trading Market Undertakings,
        and
        to provide such advise and counsel as may be reasonably necessary to carry
        out
        the Private Placement, the Registration Statement and the Trading Market
        Undertakings. The costs and expenses paid by the Purchaser hereunder shall
        be
        referred to in this Agreement as the “Purchase
        Price.”

       

      1.2.  Closing;
        Delivery.

       

      (a)  The purchase
        and sale of the Shares shall take place remotely via the exchange of documents
        and signatures, at 10:00 a.m., on October 15, 2005, or at such other time
        and
        place as the Company and the Purchasers mutually agree upon, orally or in
        writing (which time and place are designated as the “Closing”).
        

       

      (b)  At
        the
        Closing, the Company shall deliver to each Purchaser a certificate representing
        the Shares being purchased by such Purchaser. It is hereby acknowledged that
        the
        amounts paid to date by the Purchasers, along with the Purchaser’s undertakings
        under Section
        1.1(c),
        constitute payment in full of the Purchase Price.

       

      1.3.  Sale
        of Additional Shares of Preferred Stock.
        After
        the Closing, the Company shall not sell any additional shares of Series A
        Preferred Stock except with the prior written consent of all of the
        Purchasers.

       

      1.4.  Defined
        Terms Used in this Agreement.
        In
        addition to the terms defined above, the following terms used in this Agreement
        shall be construed to have the meanings set forth or referenced
        below.

       

      “Affiliate”
means
        with respect to any person or entity (a “Person”)
        any
        Person which, directly or indirectly, controls, is controlled by, or is under
        common control with such Person, including, without limitation, any partner,
        officer, director, or member of such Person.

       

      “Code”
means
        the Internal Revenue Code of 1986, as amended.

       

      “Investor
        Rights Agreement”
means
        the agreement between the Company and the Purchasers,
        dated as
        of the date of the Closing, in the form of Exhibit
        D
        attached
        to this Agreement.

       

      “Key
        Employee”
means
        any executive-level employee (including division director and Vice President
        level positions) as well as any employee who either alone or in concert with
        others develops, invents, programs or designs any Company Intellectual Property
        (as defined in Section
        2.8).

       

      
        
          
          

        

        
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      “Material
        Adverse Effect”
means
        a
        material adverse effect on the business, assets (including intangible assets),
        liabilities, financial condition, property, prospects or
        results of operations of the Company.

       

      “Purchaser”
means
        each of the Purchasers who is initially a party to this Agreement.

       

      “Securities
        Act”
means
        the Securities Act of 1933, as amended.

       

      “Shares”
means
        the shares of Series A Preferred Stock issued at the Closing.

       

      “Transaction
        Agreements”
means
        this Agreement, the Investor Rights Agreement, the Restated Articles and
        the
        Series A Certificate of Designation.

       

      2.  Representations
        and Warranties of the Company.
        The
        Company hereby represents and warrants to each Purchaser that, except as
        set
        forth on the Disclosure Schedule attached as Exhibit
        E
        to this
        Agreement which exceptions shall be deemed to be part of the representations
        and
        warranties made hereunder, the following representations are true and complete
        as of the date of the Closing, except as otherwise indicated. The Disclosure
        Schedule shall be arranged in sections corresponding to the numbered and
        lettered sections and subsections contained in this Section
        2,
        and the
        disclosures in any section or subsection of the Disclosure Schedule shall
        qualify other sections and subsections in this Section
        2
        only to
        the extent it is readily apparent from a reading of the disclosure that such
        disclosure is applicable to such other sections and subsections.

       

      For
        purposes of these representations and warranties, the phrase “to the Company’s
        knowledge” shall mean the actual knowledge after reasonable investigation of the
        following officers: Mark Trimble and John Peper. 
        In
        addition, for purposes of these representations and warranties (other than
        those
        in Sections
        2.2, 2.3, 2.4, 2.5 and 2.6),
        the
        term “the Company” shall include any subsidiaries of the Company, unless
        otherwise noted herein.

       

      2.1.  Organization,
        Good Standing, Corporate Power and Qualification.
        The
        Company is a corporation duly organized, validly existing and in good standing
        under the laws of the State of Texas and has all requisite corporate power
        and
        authority to carry on its business as presently conducted and as proposed
        to be
        conducted. The Company is duly qualified to transact business and is in good
        standing in each jurisdiction in which the failure to so qualify would have
        a
        Material Adverse Effect.

       

      2.2.  Capitalization.
        The
        authorized capital of the Company consists, immediately prior to the Closing,
        of:

       

      (a)  100,000,000
        shares of Common Stock, $0.001 par value, 21,000,000 shares of which are
        issued
        and outstanding immediately prior to the Closing. All of the outstanding
        shares
        of Common Stock have been duly authorized, are fully paid and nonassessable
        and
        were issued in compliance with all applicable federal and state securities
        laws.
        The Company holds no treasury stock and no shares of Series A Preferred Stock
        in
        its treasury.

       

      
        
          
          

        

        
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      (b)  20,000,000
        shares of Preferred Stock, $0.001 par value, of which 6,000,000 shares have
        been
        designated Series A Preferred Stock and 2,700,000 shares have been
        designated Series B Preferred Stock, none of
        which
        are issued and outstanding immediately prior to the Closing. The rights,
        privileges and preferences of the Preferred Stock are as stated in the Restated
        Certificate, the Series A Certificate of Designation, the certificate of
        designation relating to the Series B Preferred Stock and as provided by the
        general corporation law of the jurisdiction of the Company’s formation.

       

      (c)  The
        Company has reserved 1,000,000 shares of Common Stock for issuance to officers,
        directors, employees and consultants of the Company pursuant to its 2005
        Stock
        Option Plan duly adopted by the Board of Directors and approved by the Company
        stockholders (the “Stock
        Plan”).
        Of
        such reserved shares of Common Stock, no shares have been issued pursuant
        to
        restricted stock purchase agreements, no options to purchase shares have
        been
        granted and are currently outstanding, and 1,000,000 shares of Common Stock
        remain available for issuance to officers, directors, employees and consultants
        pursuant to the Stock Plan.

       

      (d)  Section
        2.2(d)
        of the
        Disclosure Schedule sets forth the capitalization of the Company immediately
        following the Closing including the number of shares of the following:
        (i) issued and outstanding Common Stock; (ii) issued stock options;
        (iii) stock options not yet issued but reserved for issuance;
        (iv) each series of Preferred Stock; and (v) warrants or stock
        purchase rights, if any. Except for (A) the conversion privileges of the
        Shares
        to be issued under this Agreement, (B) the rights provided in Section
        2.4
        of the
        Investor Rights Agreement, and (C) the securities and rights described in
        Section
        2.2(c)
        of this
        Agreement and Section
        2.2(d)
        of the
        Disclosure Schedule, there are no outstanding options, warrants, rights
        (including conversion or preemptive rights and rights of first refusal or
        similar rights) or agreements, orally or in writing, to purchase or acquire
        from
        the Company any shares of Common Stock or Series A Preferred Stock, or any
        securities convertible into or exchangeable for shares of Common Stock or
        Series
        A Preferred Stock. 

       

      (e)  All
        outstanding shares of the Company’s Common Stock and all shares of the Company’s
        Common Stock underlying outstanding options are subject to a lock-up or market
        standoff agreement of not less than one year following the Closing. None
        of the
        Company’s stock purchase agreements or stock option documents contains a
        provision for acceleration of vesting (or lapse of a repurchase right) upon
        the
        occurrence of any event or combination of events. The Company has never adjusted
        or amended the exercise price of any stock options previously awarded, whether
        through amendment, cancellation, replacement grant, repricing, or any other
        means.

       

      2.3.  Subsidiaries.
        The
        Company does not currently own or control, directly or indirectly, any interest
        in any other corporation, partnership, trust, joint venture, limited liability
        company, association, or other business entity. The Company is not a participant
        in any joint venture, partnership or similar arrangement.

       

      
        
          
          

        

        
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      2.4.  Authorization.
        All
        corporate action required to be taken by the Company’s Board of Directors and
        stockholders in order to authorize the Company to enter into the Transaction
        Agreements, and to issue the Shares at the Closing and the Common Stock issuable
        upon conversion of the Shares, has been taken or will be taken prior to the
        Closing. All action on the part of the officers of the Company necessary
        for the
        execution and delivery of the Transaction Agreements, the performance of
        all
        obligations of the Company under the Transaction Agreements to be performed
        as
        of the Closing, and the issuance and delivery of the Shares has been taken
        or
        will be taken prior to the Closing. The Transaction Agreements, when executed
        and delivered by the Company, shall constitute valid and legally binding
        obligations of the Company, enforceable against the Company in accordance
        with
        their respective terms except (i) as limited by applicable bankruptcy,
        insolvency, reorganization, moratorium, fraudulent conveyance, or other laws
        of
        general application relating to or affecting the enforcement of creditors’
rights generally, (ii) as limited by laws relating to the availability of
        specific performance, injunctive relief, or other equitable remedies, or
        (iii) to the extent the indemnification provisions contained in the
        Investor Rights Agreement may be limited by applicable federal or state
        securities laws.

       

      2.5.  Valid
        Issuance of Shares.
        The
        Shares, when issued, sold and delivered in accordance with the terms and
        for the
        consideration set forth in this Agreement, will be validly issued, fully
        paid
        and nonassessable and free of restrictions on transfer other than restrictions
        on transfer under this Agreement, the Investor Rights Agreement, applicable
        state and federal securities laws and liens or encumbrances created by or
        imposed by a Purchaser. Assuming the accuracy of the representations of the
        Purchasers in Section
        4
        of this
        Agreement and subject to the filings described in Section 2.6(ii)
        below,
        the Shares will be issued in compliance with all applicable federal and state
        securities laws. The Common Stock issuable upon conversion of the Shares
        has
        been duly reserved for issuance, and upon issuance in accordance with the
        terms
        of the Restated Certificate, will be validly issued, fully paid and
        nonassessable and free of restrictions on transfer other than restrictions
        on
        transfer under the Transaction Agreements, applicable federal and state
        securities laws and liens or encumbrances created by or imposed by a Purchaser.
        Based in part upon the representations of the Purchasers in Section
        4
        of this
        Agreement, and subject to Section
        2.6
        below,
        the Common Stock issuable upon conversion of the Shares will be issued in
        compliance with all applicable federal and state securities laws.

       

      2.6.  Governmental
        Consents and Filings.
        Assuming the accuracy of the representations made by the Purchasers in
Section
        4
        of this
        Agreement, no consent, approval, order or authorization of, or registration,
        qualification, designation, declaration or filing with, any federal, state
        or
        local governmental authority is required on the part of the Company in
        connection with the consummation of the transactions contemplated by this
        Agreement, except for (i) the filing of the Restated Certificate and the
        Series
        A Certificate of Designation, which will have been filed as of the Closing,
        and
        (ii) filings pursuant to Regulation D of the Securities Act, and applicable
        state securities laws, which have been made or will be made in a timely
        manner.

       

      
        
          
          

        

        
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      2.7.  Litigation.
        There
        is no claim, action, suit, proceeding, arbitration, complaint, charge or
        investigation pending or to the Company’s knowledge, currently threatened (i)
        against the Company or any officer, director or Key Employee of the Company;
        or
        (ii) that questions the validity of the Transaction Agreements or the right
        of
        the Company to enter into them, or to consummate the transactions contemplated
        by the Transaction Agreements; or (iii) to the Company’s knowledge, that would
        reasonably be expected to have, either individually or in the aggregate,
        a
        Material Adverse Effect. Neither the Company nor, to the Company’s knowledge,
        any of its officers or directors, is a party or is named as subject to the
        provisions of any order, writ, injunction, judgment or decree of any court
        or
        government agency or instrumentality. There is no action, suit, proceeding
        or
        investigation by the Company pending or which the Company intends to initiate.
        The foregoing includes, without limitation, actions, suits, proceedings or
        investigations pending or threatened in writing (or any basis therefor known
        to
        the Company) involving the prior employment of any of the Company’s employees,
        their services provided in connection with the Company’s business, or any
        information or techniques allegedly proprietary to any of their former
        employers, or their obligations under any agreements with prior
        employers.

       

      2.8.  Intellectual
        Property.
        The
        Company owns or possesses sufficient legal rights to (i) all trademarks,
        service
        marks, tradenames, copyrights, trade secrets, licenses, information and
        proprietary rights and processes and (ii) to the Company’s knowledge, all
        patents and patent right, (such rights are collectively referred to herein
        as
        the “Company
        Intellectual Property”)
        as are
        necessary to the conduct of the Company’s business as now conducted and as
        presently proposed to be conducted,
        without
        any known conflict with, or infringement of, the rights of others.  To
        the
        Company’s knowledge, no product or service marketed or sold (or proposed to be
        marketed or sold) by the Company violates or will violate any license or
        infringe any intellectual property rights of any other party. Other than
        with
        respect to commercially available software products under standard end-user
        object code license agreements, there are no outstanding options, licenses,
        agreements, claims, encumbrances or shared ownership interests of any kind
        relating to the foregoing, nor is the Company bound by or a party to any
        options, licenses or agreements of any kind with respect to the patents,
        trademarks, service marks, trade names, copyrights, trade secrets, licenses,
        information, proprietary rights and processes of any other person or entity.
        The
        Company has not received any communications alleging that the Company has
        violated or, by conducting its business, would violate any of the patents,
        trademarks, service marks, tradenames, copyrights, trade secrets or other
        proprietary rights or processes of any other person or entity. The Company
        has
        obtained and possesses valid licenses to use all of the software programs
        present on the computers and other software-enabled electronic devices that
        it
        owns or leases or that it has otherwise provided to its employees for their
        use
        in connection with the Company’s business. To the Company’s knowledge, it will
        not be necessary to use any inventions of any of its employees (or persons
        it
        currently intends to hire) made prior to their employment by the Company.
        Each
        Key Employee has assigned to the Company all intellectual property rights
        he or
        she owns that are related to the Company’s business as now conducted.
Section
        2.8
        of the
        Disclosure Schedule lists all patents, patent applications, registered
        trademarks, trademark applications, registered service marks, service mark
        applications, registered copyrights and domain names of the Company. The
        Company
        has not embedded any open source, copyleft or community source code in any
        of
        its products generally available or in development, including but not limited
        to
        any libraries or code licensed under any General Public License, Lesser General
        Public License or similar license arrangement. For purposes of this Section
        2.8,
        the
        Company shall be deemed to have knowledge of a patent right if the Company
        has
        actual knowledge of the patent right or would be found to be on notice of
        such
        patent right as determine by reference to United States patent
        laws.

       

      
        
          
          

        

        
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      2.9.  Compliance
        with Other Instruments.
        The
        Company is not in violation or default (i) of any provisions of its Restated
        Certificate or Bylaws, (ii) of any instrument, judgment, order, writ or decree,
        (iii) under any note, indenture or mortgage, or (iv) under any lease, agreement,
        contract or purchase order to which it is a party or by which it is bound
        that
        is required to be listed on the Disclosure Schedule, or
        of any
        provision of federal or state statute, rule or regulation applicable to the
        Company, the violation of which would have a Material Adverse Effect. The
        execution, delivery and performance of the Transaction Agreements and the
        consummation of the transactions contemplated by the Transaction Agreements
        will
        not result in any such violation or be in conflict with or constitute, with
        or
        without the passage of time and giving of notice, either (i) a default under
        any
        such provision, instrument, judgment, order, writ, decree, contract or agreement
        or (ii) an event which results in the creation of any lien, charge or
        encumbrance upon any assets of the Company or the suspension, revocation,
        forfeiture, or nonrenewal of any material permit or license applicable to
        the
        Company.

       

      2.10.  Agreements;
        Actions.

       

      (a)  Except
        for the Transaction Agreements, there are no agreements, understandings,
        instruments, contracts or proposed transactions to which the Company is a
        party
        or by which it is bound that involve (i) obligations (contingent or
        otherwise) of, or payments to, the Company in excess of $10,000, (ii) the
        license of any patent, copyright, trade secret or other proprietary right
        to or
        from the Company, (iii) the grant of rights to manufacture, produce,
        assemble, license, market, or sell its products to any other person or affect
        the Company’s exclusive right to develop, manufacture, assemble, distribute,
        market or sell its products, or (iv) indemnification by the Company with
        respect
        to infringements of proprietary rights.

       

      (b)  The
        Company has not (i) declared or paid any dividends, or authorized or made
        any distribution upon or with respect to any class or series of its capital
        stock, (ii) incurred any indebtedness for money borrowed or incurred any
        other liabilities individually in excess of $10,000 or in excess of $50,000
        in
        the aggregate, (iii) made any loans or advances to any person, other than
        ordinary advances for travel expenses, or (iv) sold, exchanged or otherwise
        disposed of any of its assets or rights, other than the sale of its inventory
        in
        the ordinary course of business. For the purposes of subsections (b) and
        (c) of
        this Section
        2.10,
        all
        indebtedness, liabilities, agreements, understandings, instruments, contracts
        and proposed transactions involving the same person or entity (including
        persons
        or entities the Company has reason to believe are affiliated with each other)
        shall be aggregated for the purpose of meeting the individual minimum dollar
        amounts of such subsection.

       

      (c)  The
        Company is not a guarantor or indemnitor of any indebtedness of any other
        person, firm or corporation.

       

      
        
          
          

        

        
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      2.11.  Conflicts
        of Interest.
        

       

      (a)  Other
        than (i) standard employee benefits generally made available to all employees,
        (ii) standard director and officer indemnification agreements approved by
        the
        Board of Directors, and (iii) the purchase of shares of the Company’s capital
        stock and the issuance of options to purchase shares of the Company’s Common
        Stock, in each instance, approved by the Board of Directors, there are no
        agreements, understandings or proposed transactions between the Company and
        any
        of its officers, directors, or Key Employees, or any Affiliate
        thereof.

       

      (b)  The
        Company is not indebted, directly or indirectly, to any of its directors,
        officers or employees or to their respective spouses or children or to any
        Affiliate of any of the foregoing, other than in connection with expenses
        or
        advances of expenses incurred in the ordinary course of business or employee
        relocation expenses. None of the Company’s directors, officers or employees, or
        any members of their immediate families, or any Affiliate of the foregoing
        (i)
        are, directly or indirectly, indebted to the Company or, (ii) to the Company’s
        knowledge, have any direct or indirect ownership interest in any firm or
        corporation with which the Company is affiliated or with which the Company
        has a
        business relationship, or any firm or corporation which competes with the
        Company except that directors, officers or employees or stockholders of the
        Company may own stock in (but not exceeding two percent of the outstanding
        capital stock of) publicly traded companies that may compete with the Company.
        To the Company’s knowledge, none of the Company’s directors, officers or
        employees or any members of their immediate families or any Affiliate of
        any of
        the foregoing are, directly or indirectly, interested in any contract with
        the
        Company. None of the directors or officers, or any members of their immediate
        families, has any material commercial, industrial, banking, consulting, legal,
        accounting, charitable or familial relationship with any of the Company’s major
        business relationship partners, service providers, joint venture partners,
        licensees and competitors.

       

      2.12.  Rights
        of Registration and Voting Rights.
        Except
        as provided in the Investor Rights Agreement, the Company is not under any
        obligation to register under the Securities Act any of its currently outstanding
        securities or any securities issuable upon exercise or conversion of its
        currently outstanding securities. To the Company’s knowledge no stockholder of
        the Company has entered into any agreements with respect to the voting of
        capital shares of the Company.

       

      2.13.  Absence
        of Liens.
        The
        property and assets that the Company owns are free and clear of all mortgages,
        deeds of trust, liens, loans and encumbrances, except for statutory liens
        for
        the payment of current taxes that are not yet delinquent and encumbrances
        and
        liens that arise in the ordinary course of business and do not materially
        impair
        the Company’s ownership or use of such property or assets. With respect to
        the property and assets it leases, the Company is in compliance with such
        leases
        and, to its knowledge, holds a valid leasehold interest free of any liens,
        claims or encumbrances other than those of the lessors of such property or
        assets.

       

      
        
          
          

        

        
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      2.14.  Financial
        Statements.
        The
        Company has delivered to each Purchaser its unaudited financial statements
        as of
        December 31, 2004 and for the fiscal year ended December 31, 2004 and its
        unaudited financial statements (including balance sheet, income statement
        and
        statement of cash flows) as of June 30, 2005 and for the six-month period
        ended
        June 30, 2005 (collectively, the “Financial
        Statements”).
        The
        Financial Statements have been prepared in accordance with generally accepted
        accounting principles applied on a consistent basis throughout the periods
        indicated, except that the unaudited Financial Statements may not contain
        all
        footnotes required by generally accepted accounting principles. The Financial
        Statements fairly present in all material respects the financial condition
        and
        operating results of the Company as of the dates, and for the periods, indicated
        therein, subject in the case of the unaudited financial statements to normal
        year-end audit adjustments. Except as set forth in the Financial Statements,
        the
        Company has no material liabilities or obligations, contingent or otherwise,
        other than (i) liabilities incurred in the ordinary course of business
        subsequent to June 30, 2005 and (ii) obligations under contracts and
        commitments incurred in the ordinary course of business and not required
        under
        generally accepted accounting principles to be reflected in the Financial
        Statements, which, in both cases, individually and in the aggregate would
        not
        have a Material Adverse Effect. The Company maintains and will continue to
        maintain a standard system of accounting established and administered in
        accordance with generally accepted accounting principles.

       

      2.15.  Changes.
        Since
        June 30, 2005 there
        has
        not been:

       

      (a)  any
        change in the assets, liabilities, financial condition or operating results
        of
        the Company from that reflected in the Financial Statements, except changes
        in
        the ordinary course of business that have not caused, in the aggregate, a
        Material Adverse Effect;

       

      (b)  any
        damage, destruction or loss, whether or not covered by insurance, that would
        have a Material Adverse Effect;

       

      (c)  any
        waiver or compromise by the Company of a valuable right or of a material
        debt
        owed to it;

       

      (d)  any
        satisfaction or discharge of any lien, claim, or encumbrance or payment of
        any
        obligation by the Company, except in the ordinary course of business and
        the
        satisfaction or discharge of which would not have a Material Adverse
        Effect;

       

      (e)  any
        material change to a material contract or agreement by which the Company
        or any
        of its assets is bound or subject;

       

      (f)  any
        material change in any compensation arrangement or agreement with any employee,
        officer, director or stockholder;

       

      (g)  any
        resignation or termination of employment of any officer or Key Employee of
        the
        Company; 

       

      
        
          
          

        

        
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      (h)  any
        mortgage, pledge, transfer of a security interest in, or lien, created by
        the
        Company, with respect to any of its material properties or assets, except
        liens
        for taxes not yet due or payable and liens that arise in the ordinary course
        of
        business and do not materially impair the Company’s ownership or use of such
        property or assets;

       

      (i)  any
        loans
        or guarantees made by the Company to or for the benefit of its employees,
        officers or directors, or any members of their immediate families, other
        than
        travel advances and other advances made in the ordinary course of its
        business;

       

      (j)  any
        declaration, setting aside or payment or other distribution in respect of
        any of
        the Company’s capital stock, or any direct or indirect redemption, purchase, or
        other acquisition of any of such stock by the Company;

       

      (k)  any
        sale,
        assignment or transfer of any Company Intellectual Property that could
        reasonably be expected to result in a Material Adverse Effect;

       

      (l)  receipt
        of notice that there has been a loss of, or material order cancellation by,
        any
        major customer of the Company;

       

      (m)  to
        the
        Company’s knowledge, any other event or condition of any character, other than
        events affecting the economy or the Company’s industry generally, 
        that
        could reasonably be expected to result in a Material Adverse Effect;
        or

       

      (n)  any
        arrangement or commitment by the Company to do any of the things described
        in
        this Section 2.15.

       

      2.16.  Employee
        Matters.
        

       

      (a)  As
        of the
        date hereof, the Company employs 14 full-time employees and 2 part-time
        employees and engages 0 consultants or independent contractors. Section
        2.16
        of the
        Disclosure Schedule sets forth a detailed description of all compensation,
        including salary, bonus, and deferred compensation paid or payable for each
        officer of the Company and for each employee, consultant and independent
        contractor of the Company who received compensation in excess of $40,000
        for the
        fiscal year ended December 31, 2004 or is anticipated to receive compensation
        in
        excess of $40,000 for the fiscal year ending December 31, 2005.

       

      (b)  To
        the
        Company’s knowledge, none of its employees is obligated under any contract
        (including licenses, covenants or commitments of any nature) or other agreement,
        or subject to any judgment, decree or order of any court or administrative
        agency, that would materially interfere with such employee’s ability to promote
        the interest of the Company or that would conflict with the Company’s business.
        Neither the execution or delivery of the Transaction Agreements, nor the
        carrying on of the Company’s business by the employees of the Company, nor the
        conduct of the Company’s business as now conducted and as presently proposed to
        be conducted, will, to the Company’s knowledge, conflict with or result in a
        breach of the terms, conditions, or provisions of, or constitute a default
        under, any contract, covenant or instrument under which any such employee
        is now
        obligated. 

       

      
        
          
          

        

        
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      (c)  The
        Company is not delinquent in payments to any of its employees, consultants,
        or
        independent contractors for any wages, salaries, commissions, bonuses, or
        other
        direct compensation for any service performed for it to the date hereof or
        amounts required to be reimbursed to such employees, consultants, or independent
        contractors. The Company has complied with all applicable state and federal
        equal employment opportunity laws and with other laws related to employment,
        including those related to wages, hours, worker classification, collective
        bargaining, and the payment and withholding of taxes and other sums as required
        by law except where noncompliance with any applicable law would not result
        in a
        Material Adverse Effect. The Company has withheld and paid to the appropriate
        governmental entity or is holding for payment not yet due to such governmental
        entity all amounts required to be withheld from employees of the Company
        and is
        not liable for any arrears of wages, taxes, penalties, or other sums for
        failure
        to comply with any of the foregoing.

       

      (d)  To
        the
        Company’s knowledge, no Key Employee intends to terminate employment with the
        Company or is otherwise likely to become unavailable to continue as a Key
        Employee, nor does the Company have a present intention to terminate the
        employment of any of the foregoing. The employment of each employee of the
        Company is terminable at the will of the Company. Except as set forth in
        Section
        2.16
        of the
        Disclosure Schedule or as required by law, upon termination of the employment
        of
        any such employees, no severance or other payments will become due. Except
        as
        set forth in Section
        2.16
        of the
        Disclosure Schedule, the Company has no policy, practice, plan, or program
        of
        paying severance pay or any form of severance compensation in connection
        with
        the termination of employment services. 

       

      (e)  The
        Company has not made any representations regarding equity incentives to any
        officer, employees, director or consultant that are inconsistent with the
        share
        amounts and terms set forth in the Company’s board minutes. 

       

      (f)  Each
        former Key Employee whose employment was terminated by the Company has entered
        into an agreement with the Company providing for the full release of any
        claims
        against the Company or any related party arising out of such
        employment.

       

      (g)  Section
        2.16
        of
        the Disclosure
        Schedule sets forth each employee benefit plan maintained, established or
        sponsored by the Company, or which the Company participates in or contributes
        to, which is subject to the Employee Retirement Income Security Act of 1974,
        as
        amended (“ERISA”).
        The
        Company has made all required contributions and has no liability to any such
        employee benefit plan, other than liability for health plan continuation
        coverage described in Part 6 of Title I(B) of ERISA, and has complied in
        all
        material respects with all applicable laws for any such employee benefit
        plan.

       

      (h) The
        Company is not bound by or subject to (and none of its assets or properties
        is
        bound by or subject to) any written or oral, express or implied, contract,
        commitment or arrangement with any labor union, and no labor union has requested
        or, to the knowledge of the Company, has sought to represent any of the
        employees, representatives or agents of the Company. There is no strike or
        other
        labor dispute involving the Company pending, or to the Company’s knowledge,
        threatened, which could have a Material Adverse Effect, nor is the Company
        aware
        of any labor organization activity involving its employees. 

       

      
        
          
          

        

        
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      (i) To
        the
        Company’s knowledge, none of the officers or directors of the Company during the
        previous five (5) years has been (a) subject to voluntary or involuntary
        petition under the federal bankruptcy laws or any state insolvency law or
        the
        appointment of a receiver, fiscal agent or similar officer by a court for
        his
        business or property; (b) convicted in a criminal proceeding or named as
        a
        subject of a pending criminal proceeding (excluding traffic violations and
        other
        minor offenses); (c) subject to any order, judgment, or decree (not
        subsequently reversed, suspended, or vacated) of any court of competent
        jurisdiction permanently or temporarily enjoining him from engaging, or
        otherwise imposing limits or conditions on his engagement in any securities,
        investment advisory, banking, insurance, or other type of business or acting
        as
        an officer or director of a public company; or (d) found by a court of
        competent jurisdiction in a civil action or by the Securities and Exchange
        Commission or the Commodity Futures Trading Commission to have violated any
        federal or state securities, commodities, or unfair trade practices law,
        which
        such judgment or finding has not been subsequently reversed, suspended, or
        vacated. 

       

      2.17.  Tax
        Returns and Payments.
         There
        are
        no federal, state, county, local or foreign taxes dues and payable by the
        Company which have not been timely paid. There are no accrued and unpaid
        federal, state, country, local or foreign taxes of the Company which are
        due,
        whether or not assessed or disputed. There have been no examinations or audits
        of any tax returns or reports by any applicable federal, state, local or
        foreign
        governmental agency. The Company has duly and timely filed all federal, state,
        county, local and foreign tax returns required to have been filed by it and
        there are in effect no waivers of applicable statutes of limitations with
        respect to taxes for any year.

       

      2.18.  Insurance.
        Section
        2.18
        of the
        Disclosure Schedule provides a complete list of the Company’s fire and casualty
        insurance policies currently in effect.

       

      2.19.  Confidential
        Information and Invention Assignment Agreements.
        Each
        current and former Key Employee, consultant and officer of the Company has
        executed an agreement with the Company regarding confidentiality and proprietary
        information substantially in the form or forms delivered to the counsel for
        the
        Purchasers (the “Confidential
        Information Agreements”).
        No
        current or former Key Employee, consultant or officer of the Company has
        excluded works or inventions from his or her assignment of inventions pursuant
        to such Key Employee’s, consultant’s or officer’s Confidential Information
        Agreements. The Company is not aware that any of its Key Employees, consultants
        or officers is in violation thereof.

       

      2.20.  Permits.
        The
        Company and each of its subsidiaries has all franchises, permits, licenses
        and
        any similar authority necessary for the conduct of its business, the lack
        of
        which could reasonably be expected to have a Material Adverse Effect. The
        Company is not in default in any material respect under any of such franchises,
        permits, licenses or other similar authority.

       

      
        
          
          

        

        
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      2.21.  Corporate
        Documents.
        The
        Restated Certificate, Series A Certificate of Designation and Bylaws of the
        Company are in the form provided to the Purchasers. The copy of the minute
        books
        of the Company provided to the Purchasers contains minutes of all meetings
        of
        directors and stockholders and all actions by written consent without a meeting
        by the directors and stockholders since the date of incorporation and accurately
        reflects in all material respects all actions by the directors (and any
        committee of directors) and stockholders with respect to all transactions
        referred to in such minutes.

       

      2.22 Environmental
        and Safety Laws.
        Except
        as could not reasonably be expected to have a Material Adverse Effect
        (a) the Company is and has been in compliance with all Environmental Laws;
        (b) there has been no release or threatened release of any pollutant,
        contaminant or toxic or hazardous material, substance or waste, or petroleum
        or
        any fraction thereof, (each a “Hazardous
        Substance”)
        on,
        upon, into or from any site currently or heretofore owned, leased or otherwise
        used by the Company; (c) there have been no Hazardous Substances generated
        by the Company that have been disposed of or come to rest at any site that
        has
        been included in any published U.S. federal, state or local “superfund” site
        list or any other similar list of hazardous or toxic waste sites published
        by
        any governmental authority in the United States; and (d) there are no
        underground storage tanks located on, no polychlorinated biphenyls
        (“PCBs”)
        or
        PCB-containing equipment used or stored on, and no hazardous waste as defined
        by
        the Resource Conservation and Recovery Act, as amended, stored on, any site
        owned or operated by the Company, except for the storage of hazardous waste
        in
        compliance with Environmental Laws. The Company has made available to the
        Purchasers true and complete copies of all material environmental records,
        reports, notifications, certificates of need, permits, pending permit
        applications, correspondence, engineering studies, and environmental studies
        or
        assessments. 

       

      For
        purposes of this Section
        2.22,
        “Environmental
        Laws”
means
        any law, regulation, or other applicable requirement relating to (a) releases
        or
        threatened release of Hazardous Substances; (b) pollution or protection of
        employee health or safety, public health or the environment; or (c) the
        manufacture, handling, transport, use, treatment, storage, or disposal of
        Hazardous Substances.

       

        2.23 Disclosure.
        The
        Company has made available to the Purchasers all the information reasonably
        available to the Company that the Purchasers have requested for deciding
        whether
        to acquire the Shares, including certain of the Company’s projections describing
        its proposed business plan (the “Business
        Plan”).
        No
        representation or warranty of the Company contained in this Agreement, as
        qualified by the Disclosure Schedule, and no certificate furnished or to
        be
        furnished to Purchasers at the Closing contains any untrue statement of a
        material fact or omits to state a material fact necessary in order to make
        the
        statements contained herein or therein not misleading in light of the
        circumstances under which they were made. The Business Plan was prepared
        in good
        faith; however, the Company does not warrant that it will achieve any results
        projected in the Business Plan. It is understood that this representation
        is
        qualified by the fact that the Company has not delivered to the Purchasers,
        and
        has not been requested to deliver, a private placement or similar memorandum
        or
        any written disclosure of the types of information customarily furnished
        to
        purchasers of securities.

       

      
        
          
          

        

        
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      3. Representations
        and Warranties of the Founders.
        Except
        as set forth in the
        Disclosure Schedule, each of the Founders, severally and not jointly, represents
        and warrants to each Purchaser as of the date of the Closing as follows (it
        being understood and agreed that any Founder's liability for breaches of
        any
        provisions of this Section
        3
        shall be
        limited to the then current fair market value of the shares of Common Stock
        of
        the Company currently owned by such Founder and such Founder may in his sole
        discretion, discharge such liability by the surrender of such shares or the
        payment of cash and will terminate two years after the date of this
        Agreement:

       

      3.1  Conflicting
        Agreements.
        Such
        Founder is not a party to and has no knowledge of any agreements, written
        or
        oral that conflicts with the rights and obligations set forth in the Transaction
        Agreements.

       

      3.2  Litigation.
         There
        is
        no action, suit or proceeding, or governmental inquiry or investigation,
        pending
        or, to such Founder's knowledge, threatened against such Founder, and, to
        such
        Founder's knowledge, there is no basis for any such action, suit, proceeding,
        or
        governmental inquiry or investigation that would result in a Material Adverse
        Effect.

       

      3.3  Stockholder
        Agreements.
        Except
        as contemplated by or disclosed in the Transaction Agreements, such Founder
        is
        not a party to and has no knowledge of any agreements, written or oral, relating
        to the acquisition, disposition, registration under the Securities Act, or
        voting of the securities of the Company.

       

      3.4  Representations
        and Warranties.
         All
        of
        the representations and warranties of the Company set forth in Section
        2
        are true
        and complete.

       

      3.5  Prior
        Legal Matters.
        During
        the previous five years, such Founder has not been (a) subject to voluntary
        or
        involuntary petition under the federal bankruptcy laws or any state insolvency
        law or the appointment of a receiver, fiscal agent or similar officer by
        a court
        for his business or property; (b) convicted in a criminal proceeding or named
        as
        a subject of a pending criminal proceeding (excluding traffic violations
        and
        other minor offenses); (c) subject to any order, judgment, or decree (not
        subsequently reversed, suspended, or vacated) of any court of competent
        jurisdiction permanently or temporarily enjoining him from engaging, or
        otherwise imposing limits or conditions on his engagement in any securities,
        investment advisory, banking, insurance, or other type of business or acting
        as
        an officer or director of a public company; or (d) found by a court of
        competent jurisdiction in a civil action or by the Securities and Exchange
        Commission or the Commodity Futures Trading Commission to have violated any
        federal or state securities, commodities or unfair trade practices law, which
        such judgment or finding has not been subsequently reversed, suspended, or
        vacated.

       

      
        
          
          

        

        
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      4.  Representations
        and Warranties of the Purchasers.
        Each
        Purchaser hereby represents and warrants to the Company, severally and not
        jointly, that:

       

        4.1. Authorization.
        The
        Purchaser has full power and authority to enter into the Transaction Agreements.
        The Transaction Agreements to which such Purchaser is a party, when executed
        and
        delivered by the Purchaser, will constitute valid and legally binding
        obligations of the Purchaser, enforceable in accordance with their terms,
        except
        (a) as limited by applicable bankruptcy, insolvency, reorganization,
        moratorium, fraudulent conveyance, and any other laws of general application
        affecting enforcement of creditors’ rights generally, and as limited by laws
        relating to the availability of a specific performance, injunctive relief,
        or
        other equitable remedies, or (b) to the extent the indemnification
        provisions contained in the Investors’ Rights Agreement may be limited by
        applicable federal or state securities laws.

       

        4.2. Purchase
        Entirely for Own Account.
        Subject
        to the allocation of Shares in the manner set forth in Exhibit
        C,
        this
        Agreement is made with the Purchaser in reliance upon the Purchaser’s
        representation to the Company, which by the Purchaser’s execution of this
        Agreement, the Purchaser hereby confirms, that the Securities to be acquired
        by
        the Purchaser will be acquired for investment for the Purchaser’s own account,
        not as a nominee or agent, and not with a view to the resale or distribution
        of
        any part thereof, and that the Purchaser has no present intention of selling,
        granting any participation in, or otherwise distributing the same. By executing
        this Agreement, the Purchaser further represents that the Purchaser does
        not
        presently have any contract, undertaking, agreement or arrangement with any
        person to sell, transfer or grant participations to such person or to any
        third
        person, with respect to any of the Shares. The Purchaser has not been formed
        for
        the specific purpose of acquiring the Shares.

       

        4.3. Disclosure
        of Information.
        The
        Purchaser has had an opportunity to discuss the Company’s business, management,
        financial affairs and the terms and conditions of the offering of the Stock
        with
        the Company’s management and has had an opportunity to review the Company’s
        facilities. The foregoing, however, does not limit or modify the representations
        and warranties of the Company in Section
        2
        of this
        Agreement or the right of the Purchasers to rely thereon.

       

        4.4. Restricted
        Securities.
        The
        Purchaser understands that the Shares have not been registered under the
        Securities Act, by reason of a specific exemption from the registration
        provisions of the Securities Act which depends upon, among other things,
        the
        bona fide nature of the investment intent and the accuracy of the Purchaser’s
        representations as expressed herein. The Purchaser understands that the Shares
        are “restricted securities” under applicable U.S. federal and state securities
        laws and that, pursuant to these laws, the Purchaser must hold the Shares
        indefinitely unless they are registered with the Securities and Exchange
        Commission and qualified by state authorities, or an exemption from such
        registration and qualification requirements is available. The Purchaser
        acknowledges that the Company has no obligation to register or qualify the
        Shares, or the Common Stock into which it may be converted, for resale except
        as
        set forth in the Investor Rights Agreement. The Purchaser further acknowledges
        that if an exemption from registration or qualification is available, it
        may be
        conditioned on various requirements including, but not limited to, the time
        and
        manner of sale, the holding period for the Shares, and on requirements relating
        to the Company which are outside of the Purchaser’s control, and which the
        Company is under no obligation and
        may
        not be able to satisfy. 

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

        4.5. No
        Public Market.
        The
        Purchaser understands that no public market now exists for the Shares, and
        that
        the Company has made no assurances that a public market will ever exist for
        the
        Shares.

       

        4.6. Legends.
        The
        Purchaser understands that the Shares and any securities issued in respect
        of or
        exchange for the Shares, may bear one or all of the following
        legends:

       

      (a) “THE
        SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
        SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH
        A
        VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH
        TRANSFER MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED
        THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT
        SUCH
        REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

       

      (b) Any
        legend set forth in, or required by, the other Transaction
        Agreements.

       

      (c) Any
        legend required by the securities laws of any state to the extent such laws
        are
        applicable to the Shares represented by the certificate so
        legended.

       

        4.7. Accredited
        Investor.
        The
        Purchaser is an accredited investor as defined in Rule 501(a) of Regulation
        D
        promulgated under the Securities Act.

       

       
        4.8 No
        General Solicitation.
        Neither
        the Purchaser, nor any of its officers, directors, employees, agents,
        stockholders or partners has been solicited, either directly or indirectly,
        including through a broker or finder by means of (a) any general
        solicitation, or (b) any advertisement in connection with the offer and
        sale of the Shares.

       

        4.9 Exculpation
        Among Purchasers.
        Each
        Purchaser acknowledges that it is not relying upon any person, firm or
        corporation, other than the Company and its officers and directors, in making
        its investment or decision to invest in the Company. Each Purchaser agrees
        that
        no Purchaser nor the respective controlling persons, officers, directors,
        partners, agents, or employees of any Purchaser shall be liable to any other
        Purchaser for any action heretofore or hereafter taken or omitted to be taken
        by
        any of them in connection with the purchase of the Shares.

       

       
        4.10.  Residence.
        If the
        Purchaser is an individual, then the Purchaser resides in the state or province
        identified in the address of the Purchaser set forth on Exhibit
        C;
        if the
        Purchaser is a partnership, corporation, limited liability company or other
        entity, then the office or offices of the Purchaser in which its principal
        place
        of business is located at the address or addresses of the Purchaser set forth
        on
Exhibit
        C.

       

      5.  Conditions
        to the Purchasers’ Obligations at Closing.
        The
        obligations of each Purchaser to purchase Shares at the Closing are subject
        to
        the fulfillment, on or before such Closing, of each of the following conditions,
        unless otherwise waived:

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

      5.1.  Representations
        and Warranties.
        The
        representations and warranties of the Company contained in Section 2
        and the
        representations and warranties of the Founders in Section
        3 shall
        be
        true and correct in all material respects as of such Closing, except that
        any
        such representations and warranties shall be true and correct in all respects
        where such representation and warranty is qualified with respect to materiality
        in Section
        2
        or
Section
        3,
        as the
        case may be.

       

      5.2.  Performance.
        The
        Company shall have performed and complied with all covenants, agreements,
        obligations and conditions contained in this Agreement that are required
        to be
        performed or complied with by it on or before Closing.

       

      5.3.  Compliance
        Certificate.
        The
        President of the Company shall deliver to the Purchasers at Closing a
        certificate certifying that the conditions specified in Sections
        5.1 and 5.2
        have
        been fulfilled.

       

      5.4.  Qualifications.
        All
        authorizations, approvals or permits, if any, of any governmental authority
        or
        regulatory body of the United States or of any state that are required in
        connection with the lawful issuance and sale of the Shares pursuant to this
        Agreement shall be obtained and effective as of Closing.

       

      
        5.5 Investor
          Rights Agreement.
          The
          Company and each
          Purchaser (other than the Purchaser relying upon this condition to excuse
          such
          Purchaser’s performance hereunder) shall have executed and delivered the
          Investor Rights Agreement.

         

        5.6 Restated
          Articles and Series A Certificate of Designation.
          The
          Company shall have filed the Restated Articles and the Series A Certificate
          of
          Designation with the Secretary of State of Texas on or prior to the Closing,
          which shall continue to be in full force and effect as of the
          Closing.

         

        5.7. Secretary’s
          Certificate.
          The
          Secretary of the Company shall have delivered to the Purchaser at the Closing
          a
          certificate certifying (i) the Bylaws of the Company, (ii) resolutions
          of the
          Board of Directors of the Company approving the Transaction Agreements
          and the
          transactions contemplated under the Transaction Agreements, and (iii)
          resolutions of the stockholders of Company approving the Restated Articles
          and
          the Series A Certificate of Designation

      

       

      5.8.  Proceedings
        and Documents. All corporate and other proceedings in connection with the
        transactions contemplated at the Closing and all documents incident thereto
        shall be reasonably satisfactory in form and substance to Purchaser, and
        Purchaser (or its counsel) shall have received all such counterpart original
        and
        certified or other copies of such documents as reasonably requested. Such
        documents may include good standing certificates.

       

      6.  Conditions
        of the Company’s Obligations at Closing.
        The
        obligations of the Company to sell Shares to the Purchasers at the Closing
        are
        subject to the fulfillment, on or before the Closing, of each of the following
        conditions, unless otherwise waived:

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

       

      6.1.  Representations
        and Warranties.
        The
        representations and warranties of each Purchaser contained in Section 3
        shall be
        true and correct in all material respects as of such Closing.

       

      6.2.  Performance.
        The
        Purchasers shall have performed and complied with all covenants, agreements,
        obligations and conditions contained in this Agreement that are required
        to be
        performed or complied with by them on or before Closing.

       

      6.3.  Qualifications.
        All
        authorizations, approvals or permits, if any, of any governmental authority
        or
        regulatory body of the United States or of any state that are required in
        connection with the lawful issuance and sale of the Shares pursuant to this
        Agreement shall be obtained and effective as of the Closing.

       

      6.4.  Investor
        Rights Agreement.
         Each
        Purchaser shall have executed and delivered the Investor Rights
        Agreement.

       

      7.  Miscellaneous.

       

      7.1.  Survival
        of Warranties.
        Unless
        otherwise set forth in this Agreement, the representations and warrants of
        the
        Company, the Founders and the Purchasers contained in or made pursuant to
        this
        Agreement shall survive the execution and delivery of this Agreement and
        the
        Closing and shall in no way be affected by any investigation of the subject
        matter thereof made by or on behalf of the Purchasers or the
        Company.

       

      7.2.  Transfer;
        Successors and Assigns.
        The
        terms and conditions of this Agreement shall inure to the benefit of and
        be
        binding upon the respective successors and assigns of the parties. Nothing
        in
        this Agreement, express or implied, is intended to confer upon any party
        other
        than the parties hereto or their respective successors and assigns any rights,
        remedies, obligations, or liabilities under or by reason of this Agreement,
        except as expressly provided in this Agreement.

       

      7.3.  Governing
        Law.
        This
        Agreement shall be governed by and construed in accordance with the Business
        Corporation Act of the State of Texas as to matters within the scope thereof,
        and as to all other matters shall be governed by and construed in accordance
        with the internal laws of the State of Texas, without regard to its principles
        of conflicts of laws.

       

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

       

      7.5.  Titles
        and Subtitles.
        The
        titles and subtitles used in this Agreement are used for convenience only
        and
        are not to be considered in construing or interpreting this
        Agreement.

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

       

      7.6.  Notices.
        All
        notices and other communications given or made pursuant to this Agreement
        shall
        be in writing and shall be deemed effectively given: (a) upon personal delivery
        to the party to be notified, (b) when sent by confirmed electronic mail or
        facsimile if sent during normal business hours of the recipient, and if not
        so
        confirmed, then on the next business day, (c) five (5) days after having
        been
        sent by registered or certified mail, return receipt requested, postage prepaid,
        or (d) one (1) day after deposit with a nationally recognized overnight courier,
        specifying next day delivery, with written verification of receipt. All
        communications shall be sent to the respective parties at their address as
        set
        forth on the signature page or Exhibit C,
        or to
        such e-mail address, facsimile number or address as subsequently modified
        by
        written notice given in accordance with this Section
        7.6.
        

       

      7.7.  No
        Finder’s Fees.
        Each
        party represents that it neither is nor will be obligated for any finder’s fee
        or commission in connection with this transaction. Each Purchaser agrees
        to
        indemnify and to hold harmless the Company from any liability for any commission
        or compensation in the nature of a finder’s fee arising out of this transaction
        (and the costs and expenses of defending against such liability or asserted
        liability) for which each Purchaser or any of its officers, employees, or
        representatives is responsible. The Company agrees to indemnify and hold
        harmless each Purchaser from any liability for any commission or compensation
        in the nature of a finder’s or broker’s fee arising out of this transaction
        (and the costs and expenses of defending against such liability or asserted
        liability) for which the Company or any of its officers, employees or
        representatives is responsible.

       

      7.8.  Attorney’s
        Fees.
        If any
        action at law or in equity (including arbitration) is necessary to enforce
        or
        interpret the terms of any of the Transaction Agreements, the prevailing
        party
        shall be entitled to reasonable attorney’s fees, costs and necessary
        disbursements in addition to any other relief to which such party may be
        entitled.

       

      7.9.  Amendments
        and Waivers.
        Any
        term of this Agreement may be amended, terminated or waived only with the
        written consent of the Company and (i) the holders of at least sixty six
        percent
        of the then-outstanding Shares or (ii) for an amendment, termination or waiver
        effected prior to the Closing, Purchasers obligated to purchase sixty six
        percent of the Shares to be issued at the Closing. Any amendment or waiver
        effected in accordance with this Section 7.9
        shall be
        binding upon the Purchasers and each transferee of the Shares (or the Common
        Stock issuable upon conversion thereof), each future holder of all such
        securities, and the Company.

       

      7.10.  Severability.
        The
        invalidity of unenforceability of any provision hereof shall in no way affect
        the validity or enforceability of any other provision.

       

      7.11.  Delays
        or Omissions.
        No
        delay or omission to exercise any right, power or remedy accruing to any
        party
        under this Agreement, upon any breach or default of any other party under
        this
        Agreement, shall impair any such right, power or remedy of such non-breaching
        or
        non-defaulting party nor shall it be construed to be a waiver of any such
        breach
        or default, or an acquiescence therein, or of or in any similar breach or
        default thereafter occurring; nor shall any waiver of any single breach or
        default be deemed a waiver of any other breach or default theretofore or
        thereafter occurring. Any waiver, permit, consent or approval of any kind
        or
        character on the part of any party of any breach or default under this
        Agreement, or any waiver on the part of any party of any provisions or
        conditions of this Agreement, must be in writing and shall be effective only
        to
        the extent specifically set forth in such writing. All remedies, either under
        this Agreement or by law or otherwise afforded to any party, shall be cumulative
        and not alternative.

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

       

      7.12.  Entire
        Agreement.
        This
        Agreement (including the Exhibits hereto, if any), the Restated Certificate,
        the
        Series A Certificate of Designation and the other Transaction Agreements
        (as
        defined in this Agreement) constitute the full and entire understanding and
        agreement between the parties with respect to the subject matter hereof,
        and any
        other written or oral agreement relating to the subject matter hereof existing
        between the parties are expressly canceled.

       

      7.13 Dispute
        Resolution.
        Any
        unresolved controversy or claim arising out of or relating to this Agreement,
        except as (i) otherwise provided in this Agreement, or (ii) any such
        controversies or claims arising out of either party’s intellectual property
        rights for which a provisional remedy or equitable relief is sought, shall
        be
        submitted to arbitration by one arbitrator mutually agreed upon by the parties,
        and if no agreement can be reached within 30 days after names of potential
        arbitrators have been proposed by the American Arbitration Association (the
        “AAA”),
        then
        by one arbitrator having reasonable experience in corporate finance transactions
        of the type provided for in this Agreement and who is chosen by the AAA.
        The
        arbitration shall take place in Houston, Texas, in accordance with the AAA
        rules
        then in effect, and judgment upon any award rendered in such arbitration
        will be
        binding and may be entered in any court having jurisdiction thereof. There
        shall
        be limited discovery prior to the arbitration hearing as follows: (a) exchange
        of witness lists and copies of documentary evidence and documents relating
        to or
        arising out of the issues to be arbitrated, (b) depositions of all party
        witnesses and (c) such other depositions as may be allowed by the arbitrators
        upon a showing of good cause. Depositions shall be conducted in accordance
        with
        the Texas Code of Civil Procedure, the arbitrator shall be required to provide
        in writing to the parties the basis for the award or order of such arbitrator,
        and a court reporter shall record all hearings, with such record constituting
        the official transcript of such proceedings. The prevailing party shall be
        entitled to reasonable attorney’s fees, costs, and necessary disbursements in
        addition to any other relief to which such party may be entitled. Each of
        the
        parties to this Agreement consents to personal jurisdiction for any equitable
        action sought in the U.S. District Court for the Southern District of Texas
        or
        any court of the State of Texas having subject matter jurisdiction.

       

      [Remainder
        of Page Intentionally Left Blank]

       

       

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      

      The
        parties have executed this Series A Preferred Stock Purchase Agreement as
        of the date first written above.

       

      
        	 	 	 
	 	THE
                JON ASHTON
                CORPORATION
	 
 	 
 	 
 
	
              	By:  	 
	 	
                

                Name:
                  Mark Trimble

                Title:
                  President

                Address: 5150
                  Franz Rd., Suite 100

                 
                  Katy, Texas 77493

              
	 	 
	 	FOUNDERS:
	 	 
	 	
                
Mark
                Trimble
                5150
                  Franz Rd., Suite 100

                Katy,
                  Texas 77493

              
	 	 
	 	
              
	 	
                
                  

                

                
                  John
                    Peper

                  5150
                    Franz Rd., Suite 100

                  Katy,
                    Texas 77493

                

              
	 	 
	 	PURCHASERS:
	 	 
	 	
                

              

      

       

      
        
          
          

        

        
          21

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