Document:

Unassociated Document

    INVESTMENT
      AGREEMENT 

     

    This
      Investment Agreement (this “Agreement”)
      is
      made and entered into as of August 24, 2007, by and among ENTLIAN
      CORPORATION,
      a
      Korean corporation (the “Company”),
      CJ
      MEDIA Inc.,
      a
      Korean corporation (“CJM”)
      and
PROELITE,
      INC.,
      a New
      Jersey corporation registered in the United States of America (“PE”,
      together with the Company and CJM, the “Parties”),
      with
      reference to the following facts:

     

    A. The
      Company is engaged primarily in the business of promoting and producing mixed
      martial arts or MMA events, providing MMA services and producing MMA products
      as
      set forth in Schedule
      A
      to this
      Agreement (the “Business”),
      using
      the MMA brands, SpiritMC, Spirit Market Challenge and InterLeague (collectively,
      “SMC”).

     

    B. Kwang
      Hyun Park (“KP”)
      is the
      current president of the Company and owns approximately 85% of the outstanding
      capital stock of the Company.

     

    C. CJM
      and
      the Company previously entered into those certain bond warrant agreements on
      August 25, 2006 (the “BW
      Agreement”),
      attached hereto as Exhibit
      A,
      pursuant to which CJM has advanced to the Company to date KRW 1,000,000,000
      (the
“Initial
      CJM Investment”)
      and
      agreed to provide a certain amount of additional funds to the
      Company.

     

    D. CJM
      and
      the Company desire to revise the terms of the BW agreement pursuant to the
      terms
      of this Agreement.

     

    E. PE
      provides certain MMA products and services through its two operating
      subsidiaries: ProElite.com, an online community providing content and tools
      for
      martial arts enthusiasts, and EliteXC Live, a mixed martial arts live events
      production company.

     

    F. PE
      desires to purchase, and the Company desires to sell shares of the Company’s
      capital stock.

     

    Based
      upon the foregoing, and in consideration of the mutual promises set forth
      herein, and other good and valuable consideration, the receipt and sufficiency
      of which is hereby acknowledged, the Parties hereby agree as follows:

     

    ARTICLE
      I

     

    Investment
      in the Company by PE

     

    1.1. Transaction;
      Purchase Price; Form of Payment.
      Upon
      the terms and subject to the conditions contained in this Agreement, on or
      before August 24, 2007 (the “Closing”),
      the
      Company will sell to PE, and PE will purchase from the Company, upon the terms
      and conditions hereinafter set forth 133,333 shares of the capital stock of
      the
      Company (“ENT
      Shares”)
      at an
      aggregate purchase price equal to US$2,000,000 (the “PE
      Investment”),
      which
      shall be composed of the following:

     

    1.1.1. US$1,000,000
      in cash (the “PE
      Cash”);
      and

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.1.2. 100,000
      restricted shares of common stock of PE, at US$10.00 per share (each a
“PE
      Share”
and
      collectively, the “PE
      Shares”),
      provided, however, that, if on the date that the Lock-up Period (as defined
      below) expires, the Market Price of the PE Shares is less than $10 per
      Share (adjusted for stock splits, stock recapitalizations, etc.), then PE shall
      issue such additional PE Shares (up to a maximum of 100,000 additional shares)
      so that the Company would have received PE Shares with a Market Value of
      $1,000,000. As used herein, “Market
      Value”
shall
      mean the average of the last reported sale prices for the five trading days
      immediately prior to the date of determination.

     

    The
      PE
      Cash shall be wired or deposited into a Korean bank account, which shall be
      designated by the Company. The PE Shares shall be delivered to the Company.
      

     

    1.2. Interest
      in the Company.
      The ENT
      Shares shall represent no less than approximately 30% of the outstanding capital
      stock of the Company after giving effect to the transactions contemplated in
      this Agreement and in other ancillary documents referred to herein (the
“Transactions”)
      and
      the conversion of the CJM Investment into ENT Shares in January 2010 (the
“Conversion”).
      Attached as Schedule
      1.2
      is a
      projected capitalization table. 

     

    1.3. Employment
      Agreement.
      Effective as of the Closing, the Company shall enter into an employment
      agreement with KP for a period ending December 31, 2010, substantially in the
      form set forth in Exhibit
      B
      to this
      Agreement, pursuant to which KP shall serve as the President and Chief Executive
      Officer of the Company.

     

    ARTICLE
      II

    Investment
      in the Company by CJM

     

    2.1. Transaction;
      Purchase Price; Form of Payment.
      The
      Company will sell to CJM, and CJM will purchase from the Company, upon the
      terms
      and conditions hereinafter set forth, an aggregate of 166,667 shares of the
      Company’s common stock (the “CJM
      Shares”),
      at an
      aggregate purchase price equal to KRW2,000,000,000 in cash as
      follows:

     

    2.1.1. BW
      Agreement.
      Under
      the terms of the BW Agreement, CJM is currently committed to invest
      KRW2,000,000,000 in the Company in total.

     

    (1) CJM
      has
      already made the Initial CJM Investment

     

    (2) Pursuant
      to the BW Agreement, CJM shall advance to the Company an additional
      KRW500,000,000 on or before June 30, 2008 and an additional KRW500,000,000
      on or
      before December 31, 2008 (collectively, the “Second
      CJM Investment”).

     

    2.2. Conversion
      of Investment.
      Subject
      to Article
      IV
      herein,
      on or before January 1, 2010, CJM shall convert (the “Conversion”)
      the
      Initial CJM Investment and the Second CJM Investment (plus all accrued interest
      thereon) into the CJM Shares. Upon the Conversion, the BW Agreement shall be
      terminated and the Company shall have no further obligations thereunder, with
      the understanding that the obligations of CJM shall continue. 

     

    
      
        
        

      

      
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    ARTICLE
      III

    Valuation
      of Investment; the Exchange Rates.

     

    3.1. Valuation
      of ENT Shares.
      

     

    3.1.1. The
      CJM
      Investment shall result in the following number of shares of capital stock
      in
      the Company:

     

    (1) 100,000
      ENT Shares for the aggregate purchase price of KRW1,000,000,000, based on a
      per
      share price of KRW10,000; 

     

    (2) 66,667
      ENT Shares for the aggregate purchase price of KRW1,000,000,000 injected from
      CJM shall have a per share conversion rate valued at KRW15,000 per
      share.

     

    3.1.2. The
      PE
      Investment shall result in 133,333 ENT Shares, based on a per share price of
      KRW15,000 per share, in accordance with Section
      3.2
      below.

     

    3.2. US
      Dollar Exchange Rate

     

    3.2.1. For
      purposes of the transactions contemplated in this Agreement, and subject to
      Subsections
      3.2.2 and 3.2.3
      below,
      the PE Investment shall be equal to approximately KRW2,000,000,000.

     

    3.2.2. Notwithstanding
      any fluctuations of the US dollar and Korean won exchange rate, PE shall have
      no
      less than a 30% equity interest (percentage of ownership) in the Company as
      of
      the date of the Conversion (assuming no further equity investment in the
      Company). 

     

    3.2.3. Subject
      to Subsection
      3.2.2
      above,
      the PE Investment shall be converted to the Korean Won based on the then current
      exchange rate of the date of the cable or wire transfer of the PE Investment.
      The Parties acknowledge, understand and recognize the risk of possible equity
      interest (percentage of ownership) changes caused by any fluctuations of the
      US
      dollar exchange rate and hereby agree and accept such changes, if any.

     

    ARTICLE
      IV

    BW
      Agreements

     

    In
      the
      event that PE materially fails to perform and carry out its obligations in
      accordance with the terms and conditions of this Agreement, the BW Agreements
      shall continue to remain in full force and effect. 

     

    ARTICLE
      V

    Due
      Diligence

     

    5.1. The
      Company, its subsidiaries and executives shall accord PE, its accountants and
      lawyers, with full access to any and all required personnel and materials for
      due diligence purposes from the Company or any of its subsidiaries. For the
      avoidance of doubt, this shall include all fighter agreements, venue contracts,
      financials statements and bank account statements, business plans, TV exhibition
      and distribution contracts, video distribution contracts, advertiser and
      sponsorship contracts (the “Assets”).

     

    
      
        
        

      

      
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    5.2. The
      Parties hereto covenant and agree as follows:

     

    5.2.1. Business
      Examinations.
      PE
      shall be entitled, through its employees and representatives, to make such
      investigations and examinations of the Assets and the books and records of
      the
      Company as PE may request for the purpose of familiarizing the Company with
      the
      Assets. Any such investigations and examinations shall be conducted at
      reasonable times and under reasonable circumstances. No investigation by PE
      shall, however, diminish or obviate in any way, or affect PE’s right to rely
      upon, any of the representations, warranties, covenants or agreements of the
      Company contained in this Agreement.

     

    5.2.2. Cooperation;
      Consents.
      Prior
      to Closing, each party shall cooperate with each other to the end that the
      parties shall (i) in a timely manner make all necessary filings with, and
      conduct negotiations with, any and all federal, state, local or foreign
      government, authority, instrumentality, department, commission, board, bureau,
      agency, official, court or other tribunal (each an “Authority”,
      collectively, the “Authorities”)
      and
      any individual, corporation, association, limited liability company,
      partnership, joint venture or other entity or organization of any kind or
      Authorities (each a “Person”
and
      collectively, “Persons”)
      the
      consent or approval of which, or a license or permit from which, is required
      for
      the consummation of the transactions contemplated herein and (ii) provide to
      each other party such information as the other party may reasonably request
      in
      order to enable it to prepare such filings and to conduct such negotiations.
      The
      parties shall also use their respective best efforts to expedite the review
      process and to obtain all such necessary consents, approvals, licenses and
      permits as promptly as practicable. To the extent permitted by applicable all
      constitutions, laws, statutes, principles of common law, rules, regulations,
      resolutions, ordinances, codes, edicts, decrees and orders promulgated,
      implemented or otherwise put into effect by or under the authority of any
      Authority (“Laws”),
      the
      parties shall request that each Authority or other Person whose review, consent
      or approval is requested treat as confidential all information which is
      submitted to it. Each of the parties shall bear its own costs and expenses
      incurred or fees paid to Authorities to obtain any governmental approvals and
      contractual consents. Each Party shall bear its own costs and expenses
      (including fees paid to authorities) incurred to obtain such consents,
      approvals, licenses or permits.

     

    ARTICLE
      VI

    Representations
      and Warranties by the Company and KP

     

    Each
      of
      the Company and KP, jointly and severally, hereby represents and warrants to
      PE,
      as of the date hereof, as follows, except as set forth on the Disclosure
      Schedules; provided,
      however,
      that no
      exception to any representation or warranty disclosed on one schedule of the
      Disclosure Schedules shall constitute an exception to any other representation
      or warranty made in this Agreement unless the substance of such exception is
      disclosed on each such other applicable schedule or a specific cross-reference
      to a disclosure on another schedule is made:

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    6.1. Organization,
      Qualification and Power.
      Such
      Party (if an entity) is an entity duly organized or incorporated, as applicable,
      validly existing, and in good standing under the Laws of the Republic of Korea.
      The shareholders listed in Schedule
      6.1
      are the
      only holders of equity interest in the Company and own 100% of the ENT Shares.
      The Company has all power and authority to carry on its business as presently
      conducted. The Company is duly licensed or qualified to transact business and
      is
      in good standing to transact business in each jurisdiction in which the conduct
      of its business requires such licensing or qualification.

     

    6.2. Authority,
      Enforceability, No Violation, Consents, Etc.

     

    6.2.1. Authority.
      The
      Company has full power and authority (including full corporate, company, trust,
      or other entity power and authority) to execute and deliver this Agreement
      and
      the other Documents to which it is or will become party and to consummate the
      Transactions and perform its obligations hereunder and thereunder. This
      Agreement constitutes the valid and legally binding obligation of such Party,
      enforceable in accordance with its terms and conditions. Upon the execution
      and
      delivery of each of the other Documents at the Closing, each of such other
      Documents to which such Party is a party will constitute the legal, valid,
      and
      binding obligation of such Party and will be enforceable against such Party
      in
      accordance with its terms and conditions, except to the extent that such
      enforceability may be limited by any applicable bankruptcy, insolvency,
      reorganization, moratorium or other similar Law relating to creditors’ rights
      generally and to general principles of equity. The execution, delivery, and
      performance of this Agreement, the BW Agreement, the Lock-Up Agreement and
      the
      Employment Agreement (the “Documents”),
      and
      all other agreements contemplated hereby or thereby have been duly authorized
      by
      such Party.

     

    6.2.2. No
      Violation.
      Except
      as set forth on Schedule
      6.2.2,
      neither
      the execution or delivery by any Party of any of the Documents to which such
      Party is or will be a party, the consummation by such Party of the Transactions,
      nor the performance by such Party of such Party’s obligations hereunder and
      thereunder will (i) violate any provision of the documented or undocumented
      charter document of the Company; (ii) violate any Law or order, in each case,
      applicable to such Party or such Party’s assets, properties or rights; (iii)
      violate, or give any Authority the right to revoke, suspend, cancel, terminate,
      or modify, any authorization by any Authority that is held by such Party or
      that
      otherwise is applicable to such Party or such Party’s assets, properties or
      rights, (iv) result in the imposition of any encumbrance upon or with respect
      to
      any asset owned or used by such Party, or (v) violate, result in a breach of
      or
      constitute (with notice or lapse of time or both) a default under, or give
      rise
      to any right of termination, cancellation, rebate, chargeback or acceleration
      under, or a right to a penalty, premium or change in delivery schedule under,
      any of the terms of, any material contract to which such Party is a party or
      by
      which such Party or any of their respective properties or assets may be bound
      or
      affected.

     

    6.2.3. Consents.
      Except
      as set forth on Schedule
      6.2.3,
      no
      filing with, and no permit, authorization, consent or approval of, any Person
      is
      necessary for such Party’s execution and delivery of the Documents, the
      consummation by such Party of the Transactions or such Party’s performance of
      its obligations hereunder or thereunder.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    6.3. Capitalization.
      

     

    6.3.1. Ownership.
      Except
      as set forth on Schedule
      6.3.1,
      no
      Person owns or holds any equity interest (or any right to acquire or security
      interest convertible or exchangeable into any equity interest) in the
      Company.

     

    6.3.2. Authorized
      Capital.
      The
      authorized capital stock of the Company consists of 200,000 shares of common
      stock, of which 244,933 shares will outstanding immediately after the Closing
      as
      contemplated herein. The ENT Shares have been duly authorized, validly issued,
      fully paid and nonassessable, and have not been issued in violation of any
      preemptive right of stockholders.

     

    6.4. Litigation.
      Except
      as set forth in Schedule
      6.4,
      there
      is no litigation pending or, to the knowledge of either of the Company and
      KP,
      threatened relating to the Company.

     

    6.5. Intellectual
      Property.
      As of
      the date hereof to the knowledge of the Company and KP:

     

    6.5.1. all
      Intellectual Property within the Business are valid and in full force and
      effect;

     

    6.5.2. there
      are
      no pending claims, actions, or other adversary proceedings, disputes or
      disagreements involving the Company concerning any item of its Intellectual
      Property, and, to the actual knowledge of the Company and KP, no such action,
      proceeding, dispute or disagreement is threatened.

     

    6.5.3. “Intellectual
      Property”
means
      all (a) U.S., Korean and other foreign patents and patent applications and
      disclosures relating thereto (and any patents that issue as a result of those
      patent applications), and any renewals, reissues, reexaminations, extensions,
      continuations, continuations-in-part, divisions and substitutions relating
      to
      any of the patents and patent applications, (b) U.S., Korean and other foreign
      trademarks, service marks, trade dress, logos, trade names and corporate names,
      whether or not registered, and the goodwill associated therewith and
      registrations and applications for registration thereof, (c) U.S. and foreign
      copyrights and rights under copyrights, including moral rights, whether or
      not
      registered, and registrations and applications for registration thereof,
      (d) U.S. and foreign mask work rights and registrations and applications
      for registration thereof, (e) Trade Secrets, (f) all domain name
      registrations, (g) any other inventions (whether or not patentable) or
      know-how and all improvements thereto and (h) all other works of authorship
      (whether or not copyrightable).

     

    6.5.4. “Trade
      Secrets”
means
      all trade secrets and confidential business information (including ideas,
      formulas, compositions, know-how, research and development information,
      software, drawings, specifications, designs, plans, proposals, technical data,
      copyrightable works, financial, marketing and business data, pricing and cost
      information, business and marketing plans marketing mailing and e-mail lists,
      and customer and supplier mailing and e-mail lists and
      information).

     

    6.6. Investment
      Representation.
      The
      Company is and will be acquiring the PE Shares for investment purposes only
      and
      not with a view to distribution.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      VII

    Representations
      and Warranties of CJM

     

    CJM
      hereby represents and warrants to PE, as of the date hereof, as follows, except
      as set forth on the Disclosure Schedules; provided,
      however,
      that no
      exception to any representation or warranty disclosed on one schedule of the
      Disclosure Schedules shall constitute an exception to any other representation
      or warranty made in this Agreement unless the substance of such exception is
      disclosed on each such other applicable schedule or a specific cross-reference
      to a disclosure on another schedule is made:

     

    7.1. Organization,
      Qualification and Power.
      CJM is
      an entity duly organized or incorporated, as applicable, validly existing,
      and
      in good standing under the Laws of the Republic of Korea. CJM has all power
      and
      authority to carry on its business as presently conducted. CJM is duly licensed
      or qualified to transact business and is in good standing to transact business
      in each jurisdiction in which the conduct of its business requires such
      licensing or qualification.

     

    7.2. Authority,
      Enforceability, No Violation, Consents, Etc.

     

    7.2.1. Authority.
      CJM has
      full power and authority (including full corporate, company, trust, or other
      entity power and authority) to execute and deliver this Agreement and the other
      Documents to which it is or will become party and to consummate the Transactions
      and perform its obligations hereunder and thereunder. This Agreement constitutes
      the valid and legally binding obligation of CJM, enforceable in accordance
      with
      its terms and conditions. Upon the execution and delivery of each of the other
      Documents at the Closing, each of such other Documents to which CJM is a party
      will constitute the legal, valid, and binding obligation of CJM and will be
      enforceable against CJM in accordance with its terms and conditions, except
      to
      the extent that such enforceability may be limited by any applicable bankruptcy,
      insolvency, reorganization, moratorium or other similar Law relating to
      creditors’ rights generally and to general principles of equity. The execution,
      delivery, and performance of this Agreement, the Documents, and all other
      agreements contemplated hereby or thereby have been duly authorized by such
      Party.

     

    7.2.2. No
      Violation.
      Except
      as set forth on Schedule
      7.2.2,
      neither
      the execution or delivery by CJM of any of the Documents to which CJM is or
      will
      be a party, the consummation by CJM of the Transactions, nor the performance
      by
      CJM of CJM’s obligations hereunder and thereunder will (i) violate any provision
      of the documented or undocumented charter document of CJM; (ii) violate any
      Law
      or order, in each case, applicable to CJM; (iii) violate, or give any Authority
      the right to revoke, suspend, cancel, terminate, or modify, any authorization
      by
      any Authority that is held by CJM or that otherwise is applicable to CJM or
      CJM’s assets, properties or rights; (iv) result in the imposition of any
      encumbrance upon or with respect to any asset owned or used by CJM; or (v)
      violate, result in a breach of or constitute (with notice or lapse of time
      or
      both) a default under, or give rise to any right of termination, cancellation,
      rebate, chargeback or acceleration under, or a right to a penalty, premium
      or
      change in delivery schedule under, any of the terms of, any material contract
      to
      which CJM is a party or by which CJM or any of their respective properties
      or
      assets may be bound or affected.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    7.2.3. Consents.
      Except
      as set forth on Schedule
      7.2.3,
      no
      filing with, and no permit, authorization, consent or approval of, any Person
      is
      necessary for CJM’s execution and delivery of the Documents, the consummation by
      CJM of the Transactions or CJM’s performance of its obligations hereunder or
      thereunder.

     

    ARTICLE
      VIII

    Representations
      and Warranties of PE

     

    PE
      represents and warrants to the Company as follows:

     

    8.1. Due
      Incorporation.
      PE is a
      corporation in good standing under the applicable Laws of the state of
      California, United States and is duly organized, validly existing and in good
      standing under the applicable Laws of the state of New Jersey, United
      States.

     

    8.2. Authority
      to Execute and Perform Agreements.
      PE has
      all requisite power, authority and approval required to enter into, execute
      and
      deliver this Agreement and the other Documents and to perform fully their
      respective obligations hereunder and thereunder.

     

    8.3. Due
      Authorization; Enforceability.
      PE has
      taken all actions necessary to enter into and perform its obligations under
      this
      Agreement including the issuance of the PE Shares and all other Documents and
      to
      consummate the transactions contemplated herein and therein. This Agreement
      has
      been duly and validly executed by PE and (assuming the due authorization,
      execution and delivery by the Company, CJM and KP) constitutes the legal, valid
      and binding obligations of Purchaser and Parent enforceable in accordance with
      its terms. 

     

    8.4. Capitalization.
      The
      authorized capital stock of PE consists of (i) 250,000,000 shares of common
      stock, par value $0.0001, of which 46,242,619 shares are outstanding as of
      the
      date of this Agreement and (ii) 20,000,000 shares of preferred stock, par value
      $0.001 per share, none of which are outstanding. The PE Shares have been duly
      authorized, validly issued, fully paid and nonassessable, and have not been
      issued in violation of any preemptive right of stockholders. 

     

    8.5
      No
      Violation 
      Except
      as set forth on Schedule
      8.5.
      neither
      the execution or delivery by PE of any of the Documents to which PE is or will
      be a party, the consummation by PE of the Transactions, nor the performance
      by
      PE of PE’s obligations hereunder and thereunder will (i) violate any provision
      of the documented or undocumented charter document of PE; (ii) violate any
      Law
      or order, in each case, applicable to PE; (iii) violate, or give any Authority
      the right to revoke, suspend, cancel, terminate, or modify, any authorization
      by
      any Authority that is held by PE or that otherwise is applicable to PE or PE’s
      assets, properties or rights; (iv) result in the imposition of any encumbrance
      upon or with respect to any asset owned or used by PE; or (v) violate, result
      in
      a breach of or constitute (with notice or lapse of time or both) a default
      under, or give rise to any right of termination, cancellation, rebate,
      chargeback or acceleration under, or a right to a penalty, premium or change
      in
      delivery schedule under, any of the terms of, any material contract to which
      PE
      is a party or by which PE or any of their respective properties or assets may
      be
      bound or affected.

     

    8.6
      Consents.
      Except as set forth on Schedule
      8.6,
      no
      filing with, and no permit, authorization, consent or approval of, any Person
      is
      necessary for PE’s execution and delivery of the Documents, the consummation by
      PE of the Transactions or PE’s performance of its obligations hereunder or
      thereunder.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

     

    ARTICLE
      IX

    Covenants

     

    9.1. Pre-Closing
      Covenants.

     

    9.1.1. Number
      of Authorized Shares.
      The
      number of authorized shares of capital stock of the Company shall be increased
      to 500,000 shares of capital stock prior to the Closing. 

     

    9.2. Post-Closing
      Covenants.

     

    9.2.1. Lock-up.
      The PE
      Shares shall not be sold, transferred, assigned, pledged or hypothecated, nor
      shall any of the PE Shares be subject to any hedging, short sale, derivative,
      put, or call transactions that would result in the effective economic
      disposition of such PE Shares for a period ending on the 18-month anniversary
      of
      the effective date of a registration statement on Form SB-2 that PE plans to
      file with the United States Securities and Exchange Commission on or before
      August 24, 2007 (the “Lock-Up
      Period”).
      The
      form of the Lock-Up Agreement is attached hereto as Exhibit
      C.

     

    9.2.2. Board
      Representation.
      PE
      shall have a minimum of one seat on the board of directors of the Company at
      all
      times, and shall always have no less than the same board representation as
      CJM
      and KP at any given time.

     

    9.2.3. Use
      of
      Proceeds from PE Investment.
      The PE
      Investment shall be used to fund the Business, including SMC operating costs,
      marketing and fight promotion expenditures. 

     

    9.2.4. International
      Programming Distribution.
      PE
      shall have the exclusive right to exploit all SMC content in the Company’s
      library in the United States of America, as listed in Schedule
      9.2
      (“SMC
      Content”).
      However, PE shall not assign its right to exploit all SMC Content without prior
      written consent from the Company. The Company shall have the exclusive right
      to
      exploit all SMC Content. Both PE and CJM shall equally share worldwide
      distribution rights of all SMC Content outside of both the United States and
      the
      Republic of Korea, provided that: (1) PE or the CJM, as the case may be, gives
      notice to the Company or PE of any potential deal, transaction or opportunity
      to
      the other Party, and (2) such potential deal, transaction or opportunity is
      approved by the Company’s management. 

     

    (1) PE
      shall
      receive a distribution fee equal to 30% of the gross proceeds from such
      licensing of any and all distribution services it provides. All expenses
      relating to the sales of such programming shall be at PE’s expense.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (2) PE
      shall
      have the right to stream all SMC live events, (“Streaming
      Rights”)
      and
      the proceeds shall be divided equally between PE and the Company, net of any
      costs and expenses incurred by PE. Any
      exercising of Streaming Rights shall employ such reasonable technological and
      physical security measures designed to ensure that the SMC live events is made
      available only to such viewers who have been specifically authorized to receive
      the SMC events and who are located within the territory of United States. 
Without limiting the generality of the foregoing, at all times, all commercially
      reasonable and current technologies and methods with respect to geofiltering,
      encryption, and digital rights management, designed to prevent any unauthorized
      copying, access, distribution, streaming, or downloading of the Picture shall
      be
      employed when exercising Streaming Rights.  For the avoidance of doubt, the
      above shall also apply to PE’s exploitation of Streaming Rights outside the
      United States. 

     

    (3) PE
      shall
      keep books of account relating to its exploitation of SMA Content. The Company
      may, at its own discretion, audit the applicable records at the place where
      PE
      maintains the same in order to verify any earning statements provided by PE,
      provided that the Company provide reasonable advance notice in accordance with
      Section
      11.2
      below

     

    9.2.5. Promotional
      Rights.
      PE
      shall receive unlimited access and usage for promotional purposes at no cost
      to
      PE to the SMC library of all existing and future programming and content. No
      license fees shall be payable to the Company, KP or CJM by PE if such library
      content are used for the purpose of promoting MMA events produced by either
      PE
      or the Company.

     

    9.2.6. Signage
      Rights and Marketing Recognition.
      PE
      shall have signage rights and marketing recognition at MMA events promoted
      by
      SMC, including but not limited to prominent banner presence, logo positioning
      on
      the ring mat and ring posts and event program and in arena video promotion
      branding through interstitials and promos. Such signage rights and marketing
      recognition shall be on par with other recognized sponsors at such MMA events.
      

     

    9.2.7. Anti-Dilution.
      The
      Company shall not issue any additional ENT Shares without (i) the approval
      by
      holders of at least 50% of the then outstanding ENT Shares and (ii) the majority
      approval of its board of directors as to both the number of additional ENT
      Shares to be issued and the share price, subject to the following
      conditions:

     

    (1) The
      share
      price shall be greater than KRW15,000 per ENT Share (“Minimum
      Price”),
      unless a share price at or below the Minimum Price is approved by each of KP,
      CJM and PE. 

     

    (2) Each
      Party shall have the right to purchase its pro rata share of such additional
      ENT
      Shares (“Additional
      Shares”),
      which
      shall be a number equal to the product obtained by multiplying (x) the number
      of
      Additional Shares by (y) a fraction, (i) the numerator of which shall be the
      number of ENT Shares held by such Party on the date the Company issues a notice
      which details its intention to issue additional ENT Shares, the total number
      of
      ENT Shares proposed to be issued and the bona fide cash price or, in reasonable
      detail, other consideration for which the Company proposes to issue such ENT
      Shares, and (ii) the denominator of which shall be the number of ENT Shares
      outstanding prior to the issuance of such Additional Shares. In the event that
      one of the Parties declines to exercise its right of first refusal, the
      remaining two Parties shall each have the right to purchase 50% of such
      declining Party’s pro rata share of the Additional Shares.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    (3) In
      the
      event the Company wishes to raise additional capital through the issuance of
      additional ENT Shares prior to January 1, 2010 at 12:01 A.M., Republic of Korea
      time, the Company shall first receive prior written approval of all Parties
      to
      this Agreement, provided that CJM shall not unreasonably withhold its approval.
      

     

    9.2.8. Shares
      owned by KP.
      In the
      event that KP offers any of his shares of capital stock of the Company (the
      “KP
      Shares”)
      for
      sale, assignment, encumbrance, pledge, gift, conveyance in trust, transfer
      by
      bequest, devise or descent, or other transfer of disposition of any kind
      (“Transfer”),
      KP
      shall send a notice of such Transfer to PE and CJM, and PE and CJM shall have
      the right to purchase all or any part of the KP Shares offered for Transfer,
      provided that such right between PE and CJM shall be on a pro rata basis based
      on each Party’s equity interest in the Company, assuming full Conversion of the
      CJM Shares. 

     

    ARTICLE
      X

    Closing
      Conditions

     

    10.1. Conditions
      to the Company’s Obligations to Close.
      The
      obligations of the Seller to consummate the transactions provided for hereby
      are
      subject to the satisfaction, before or on the date of the Closing (the
“Closing
      Date”),
      of
      each of the conditions set forth below in this Section 10.1,
      any of
      which may be waived by Seller.

     

    10.1.1. Representations,
      Warranties and Covenants.
      (i) All
      representations and warranties of PE contained in this Agreement, shall be
      true
      and correct at and as of the Closing Date, and (ii) PE shall have performed
      and satisfied all agreements and covenants, required hereby to be performed
      by
      it before or on the Closing Date. 

     

    10.1.2. No
      Actions or Court Orders.
      There
      shall not be any court decision, order or injunction by any court or other
      governmental body that makes the purchase and sale of the PE Shares contemplated
      hereby illegal or otherwise prohibited. 

     

    10.1.3. Ancillary
      Agreements.
      PE
      shall have executed and delivered all agreements contemplated hereunder to
      which
      the PE is a party.

     

    10.1.4. Closing
      Deliverables.
      PE
      shall have delivered, or caused to be delivered, to the Company those items
      set
      forth in Sections
      1.1 and 1.4
      hereof.

     

    10.2. Conditions
      to PE’s Obligations to Close.
      The
      obligations of PE to consummate the transactions provided for hereby are subject
      to the satisfaction, before or on the Closing Date, of each of the conditions
      set forth below in this Section 10.2,
      any of
      which may be waived by PE.

     

    10.2.1. Representations,
      Warranties and Covenants.
      (i) All
      representations and warranties of KP and the Company contained in this
      Agreement, shall be true and correct at and as of the Agreement Date and at
      and
      as of the Closing Date, and (ii) KP and the Company shall have performed and
      satisfied all agreements and covenants, required hereby to be performed by
      it
      before or on the Closing Date.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    10.2.2. No
      Actions or Court Orders.
      No
      action by any governmental body or other person shall have been instituted
      or
      threatened which questions the validity or legality of the transactions
      contemplated hereby and which could reasonably be expected to damage the PE,
      or
      the Company if the transactions contemplated hereby are consummated. There
      shall
      not be any regulation or court order that makes the purchase and sale of the
      ENT
      Shares contemplated hereby illegal or otherwise prohibited.

     

    10.2.3. Ancillary
      Agreements.
      KP and
      the Company shall have executed and delivered all agreements contemplated
      hereunder to which it is a party.

     

    10.2.4. Consents.
      All
      permits, consents, approvals and waivers from any entity shall have been
      obtained, except to the extent that the failure to obtain such permits,
      consents, approvals and waivers could not reasonably be expected to materially
      damage the PE after the Closing. 

     

    10.2.5. No
      Material Adverse Change.
      There
      shall have been no material adverse change to the business of the
      Company.

     

    10.2.6. Closing
      Deliverables.
      The
      Seller shall have delivered, or caused to be delivered, to the PE those items
      set forth in Section 1.3
      and Article II
      hereof.

     

    10.2.7. Due
      Diligence Confirmation.
      PE has
      confirmed to its reasonable satisfaction due diligence of the
      Company.

     

    ARTICLE
      XI

    Miscellaneous

     

    11.1. Indemnification.
      The
      parties shall indemnify and hold harmless the other party and its subsidiaries
      and their respective officers and directors from and against all claims
      resulting from or arising out of (i) any inaccuracy in or breach of any of
      the
      representation or warranties of the party (ii) any breach or nonfulfilment
      of
      any covenants or agreements by the party and (iii) any liability or obligation
      of the party herein. 

     

    11.2. Notices

     

    11.3. All
      notices and other communications hereunder shall be in writing and shall be
      deemed to have been duly given when delivered in person or received by
      telegraphic or other electronic means (including facsimile, telecopy, telex,
      and
      e-mail) with confirmation of transmission by the transmitting equipment or
      when
      delivered by overnight courier, or if mailed, five days after being deposited
      in
      the United States mail, certified or registered mail, first-class postage
      prepaid, return receipt requested, to the parties at the addresses or facsimile
      numbers set forth on Appendix A
      hereto.
      Any party from time to time may change its physical address, e-mail address,
      or
      facsimile number for the purpose of receipt of notices to that party hereunder
      by giving notice specifying a new physical address, e-mail address, or facsimile
      number to the other Persons listed on Appendix A
      in
      accordance with the provisions of this Section 11.2,
      which
      will not constitute an amendment under Section 11.9. 

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    11.4. Confidentiality.
      The
      Parties shall not disclose this “Agreement” or the terms or existence of the
      proposed transaction except to their legal, tax and accounting advisors with
      a
      need to know such information. In the event that any Party is requested or
      required pursuant to written or oral question or request for information or
      documents in any legal proceeding, interrogatory, subpoena, civil investigative
      demand, or similar process to disclose any confidential information, such Party
      will notify the other Parites promptly of the request or requirement so that
      the
      notified Parties may seek an appropriate protective order or waive compliance
      with the provisions of this Section 11.3.
      If, in
      the absence of a protective order or the receipt of a waiver hereunder, such
      Party is, on the advice of counsel, compelled to disclose any confidential
      information to any tribunal or else stand liable for contempt, such Party may
      disclose the confidential information to the tribunal; provided,
      however,
      that
      the disclosing Party shall use his, her, or its reasonable best efforts to
      obtain, at the reasonable request of the other nondisclosing Parties, an order
      or other assurance that confidential treatment will be accorded to such portion
      of the confidential information required to be disclosed as the Party or Parties
      shall designate. The foregoing provisions shall not apply to any confidential
      information that is generally available to the public immediately prior to
      the
      time of disclosure unless such confidential information is so available due
      to
      the actions of any Party. 

     

    11.5. Severability.
      Any
      provision of this Agreement which may be prohibited by or otherwise held invalid
      shall be ineffective only to the extent of such prohibition or invalidity and
      shall not be invalidate or otherwise render ineffective any or all of the
      remaining provisions of this Agreement.

     

    11.6. Entire
      Agreement.
      This
      Agreement and the Documents, set forth the entire agreement between among the
      Parties hereto, fully supersedes any and all prior agreements or understandings
      between the parties hereto pertaining to the subject matter hereof, and no
      change in, modification of or addition, amendment or supplement to this
      Agreement shall be valid unless set forth in writing and signed and dated by
      both of the parties hereto subsequent to the execution of this
      Agreement.

     

    11.7. Taxes.
      In the
      event any tax becomes due by reason of this Agreement, such tax shall be borne
      by the party upon whom such tax is imposed by applicable law. 

     

    11.8. Binding
      Effect.
      This
      Agreement and the respective rights and obligations of the parties hereunder
      shall be binding upon and inure to the benefit of the parties hereto and their
      respective successors, legal representatives and permitted assigns.

     

    11.9. Modification.
      This
      Agreement may not be modified, amended, changed, discharged or terminated,
      except in writing signed by the party against whom enforcement of any such
      modification, amendment, change, discharge or termination is
      sought.

     

    11.10. Headings.
      The
      section headings used in this Agreement are intended solely for convenience
      of
      reference and shall not in any way or manner amplify, limit, modify or otherwise
      be used in the interpretation of any of the provisions of this
      Agreement.

     

    11.11. Dispute
      Resolution.
      

     

    11.11.1. All
      controversies, claims and disputes arising out of or in connection with this
      Agreement shall be settled by mutual consultation between the parties in good
      faith as promptly as possible, but failing an amicable settlement, shall be
      settled exclusively by Seoul Central District Court.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    11.11.2. This
      Agreement, the respective rights, obligations and remedies of the parties
      hereunder, the interpretation hereof, and all disputes, controversies and claims
      arising out of or related to this Agreement, shall be governed by and construed
      in accordance with the laws of Korea.

     

    

     

    

     

    [Signature
      page follows]

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

     

    IN
      WITNESS WHEREOF,
      each
      party agrees that it has the authority to enter into this Investment Agreement
      and accordingly the Parties have executed this Agreement as of this ___ day
      of
      August 2007.

     

    
      	
              ENTLIAN
                CORPORATION

               

               

            	 
	
              By:
                /s/
                Park Kwang Hyun 

              
                

              

              Kwanghyun
                Park, President

               

               

            	
              By:
                /s/
                Park Kwang Hyun 

              
                

              

              Kwanghyun
                Park, an individual

            
	
              PROELITE,
                INC.

               

               

            	 
	
              By:
                /s/ William Kelly 

               

                

              

              William
                Kelly, Chief Operating Officer

               

               

            	 
	 	 
	
               

              CJ
                MEDIA Inc.

              By:
                /s/
                S.H. Kang 

              
                

              

              S.H.
                Kang, Chief Executive Officer

            	 
	 	 

    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

       

    

    SCHEDULE
      A

    

    THE
      “BUSINESS”

    

    The
      Company and SMC brands, trademarks and service marks;

     

    Past,
      present and future the Company and SMC programming library and video assets
      in
      all forms of media;

     

    Past,
      present and future the Company and SMC fighter and talent
      contracts;

     

    Past,
      present and future the Company and SMC third-party media contracts;

     

    All
      future the Company and SMC royalties and receivables;

     

    Present
      and future the Company and SMC venue contracts and agreements;

     

    All
      other
      future and present contracts and agreements associated with the Company and
      SMC.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    BW
      AGREEMENT

     

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

    

    EMPLOYMENT
      AGREEMENT WITH KWANG HYUN PARK

     

    
 

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

    

    FORM
      OF LOCK-UP AGREEMENT

    

    August
      ___, 2007

     

    ProElite,
      Inc.

    12121
      Wilshire Boulevard, Suite1001

    Los
      Angeles, CA 90025

    Attention:
      Chief Financial Officer

     

    Gentlemen:

     

    In
      connection with the issuance by ProElite, Inc. (the “Company”)
      of
      shares of its common stock, par value $0.0001 pursuant to that Investment
      Agreement dated as of August __, 2007 between the Company, Entlian Corporation
      (“ETN”),
      CJ
      Media Inc. (“CJM”)
      and
      Kwanghyun Park (“KP”),
      the
      undersigned hereby agree that, during the period beginning on the date hereof
      (the “Effective
      Date”)
      and
      ending on the date that is 18 months after the date the Company receives
      notification by the Securities and Exchange Commission that the registration
      statement required to be filed by the Company pursuant to that certain
      Registration Rights Agreement between the Company and the investors of the
      Company’s private placement offering on June 30, 2007 (the “Registration
      Statement”)
      has
      been declared effective (the
      “Lock-Up
      Period”),
      the
      undersigned will not: (1) sell, transfer, assign, pledge or hypothecate any
      Covered Securities or (2) subject the Covered Securities to any hedging, short
      sale, derivative, put, or call transactions that would result in the effective
      economic disposition of the Covered Securities by any person (the “Lock-Up”).

     

    Notwithstanding
      the foregoing:

     

    1. The
      Lock-Up shall not apply during the period that the sales price per share of
      common stock is at least $15.00, provided (A) the Registration Statement has
      been declared effective by the Securities and Exchange Commission and is then
      still effective and (B) the shares of the Company’s common stock are then listed
      on the Nasdaq Stock Market or the American Stock Exchange.

     

    2. The
      Lock-up Agreement shall not apply to any private transfer of all or portion
      of
      the Covered Securities provided the transferee agrees to be bound by the terms
      hereof.

     

    The
      obligations of the undersigned that are contained in this letter agreement
      also
      apply (i) to all Covered Securities that the undersigned may receive as a
      stock dividend or other distribution on the Covered Securities and (ii) to
      all other securities of the Company that the undersigned may receive in a
      recapitalization or similar transaction in exchange for Covered Securities
      acquired by the undersigned.

     

    The
      undersigned consent to the entry of stop transfer instructions with the
      Company’s transfer agent and registrar against the transfer of the Covered
      Securities except in compliance with the preceding provisions of this Lock-Up
      Agreement. The undersigned also consents to the placement of legend on any
      and
      all stock certificates that evidence the Covered Securities which are the
      subject of this Lock-Up Agreement.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      	 	
              Very
                truly yours,

            
	 	
              Entlian
                Corporation

               

               

              By:  
                /s/
                Park Kwang Hyun 

              
                

              

              Kwanghyun
                Park, President 

               

               

            
	 	
              /s/
                Park Kwang Hyun 

              
                

              

              Kwanghyun
                Park, an individual

            
	
              ACCEPTED:

               

              ProElite,
                Inc.

               

               

              By:
                _________________________________

            	 
	 	 

    

    

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
      A

     

    THE
      “BUSINESS”

     

    The
      Company and SMC brands, trademarks and service marks;

     

    Past,
      present and future the Company and SMC programming library and video assets
      in
      all forms of media;

     

    Past,
      present and future the Company and SMC fighter and talent
      contracts;

     

    Past,
      present and future the Company and SMC third-party media contracts;

     

    All
      future the Company and SMC royalties and receivables;

     

    Present
      and future the Company and SMC venue contracts and agreements;

     

    All
      other
      future and present contracts and agreements associated with the Company and
      SMC.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

       

    

    APPENDIX
      A

    NOTICE
      ADDRESSES

     

    if
      to the
      Company, to:

     

    Entlian
      Corporation

    2nd
      Fl.
      Hanmaru Bldg. 920-9 Daechi-dong

    Kangnam-gu,
      Seoul

    Korea

    Attention:
      President

    Facsimile:
      82-2-565-0998

    Email:
      khp@spiritmc.org

     

    If
      to KP,
      to:

     

    2nd
      Fl.
      Hanmaru Bldg. 920-9 Daechi-dong

    Kangnam-gu,
      Seoul

    Korea

     

    if
      to
      CJM, to:

    

    CJ
      Media
      Inc.

    CJ
      Media
      Inc.

    97-1,
      Chodam-dong Kangnam-gu

    Seoul,
      135-100

    Korea

    Attention:
      Senior VP

    Facsimile:
      82-2-3440-4488

    Email:
      leeho@cj.net

     

    if
      to
      PE,
      to:

     

    ProElite,
      Inc.

     

    12121
      Wilshire Boulevard, Suite1001

    Los
      Angeles, CA 90025

    United
      States

    Attention:
      William Kelly

    Facsimile:
      (310) 526-8740

    Email:
      William.Kelly@proelite.com

     

    with
      a
      copy to:

     

    Troy
      & Gould PC

    1801
      Century Park East

    Suite
      1600

    Los
      Angeles, CA 90067-2367

    United
      States

    Attention:
      David L. Ficksman, Esq.

    Facsimile:  (310)
      789-1490

    Email:  dficksman@troygould.com

     

    
      
        
        

      

      
        22THIS
      WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
      OR ANY OTHER SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED,
      PLEDGED OR HYPOTHECATED IN THE ABSENCE OF (1) AN EFFECTIVE REGISTRATION
      STATEMENT COVERING SUCH SECURITIES UNDER THE SECURITIES ACT AND ANY OTHER
      APPLICABLE SECURITIES LAWS, OR (2) AN OPINION OF COUNSEL REASONABLY SATISFACTORY
      TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.

    

    IN
      ADDITION, THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF
MAY
      NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED, OR HYPOTHECATED, OR BE THE SUBJECT
      OF ANY HEDGING, SHORT SALE, DERIVATIVE, PUT, OR CALL TRANSACTION THAT WOULD
      RESULT IN THE EFFECTIVE ECONOMIC DISPOSITION OF SUCH SECURITIES BY ANY PERSON
      FOR A PERIOD OF ONE (1) YEAR IMMEDIATELY FOLLOWING THE DATE OF EFFECTIVENESS
      OF
      THE PUBLIC OFFERING OF THE COMPANY’S SECURITIES PURSUANT TO REGISTRATION
      STATEMENT NO.: 333-142649
      AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, EXCEPT IN ACCORDANCE
      WITH
      FINRA RULE 2710(G)(2).

    

    EYETEL
      IMAGING, INC.

    

    UNDERWRITERS’
      WARRANT

    

    [                       
       ] shares of Common Stock

    

    ___________________,
      2007

    

    This
      UNDERWRITERS’ WARRANT
      (this
“Warrant”)
      of
      EyeTel Imaging, Inc., a corporation duly organized and validly existing under
      the laws of the State of Delaware (the “Company”),
      is
      being issued pursuant to that certain Underwriting Agreement, dated as of

    _________________,
      2007 (the “Underwriting
      Agreement”),
      by
      and between the Company and Stanford Group Company, the representative of the
      underwriters named therein (the “Representative”)
      relating to a firm commitment public offering (the “Offering”)
      of
      __________________ shares of common stock, $0.001 par value per share, of the
      Company (the “Common
      Stock”)
      underwritten by the Representative and the underwriters named in the
      Underwriting Agreement.

    

    FOR
      VALUE RECEIVED,
      the
      Company hereby grants to ________________ and its permitted successors and
      assigns (collectively, the “Holder”)
      the
      right to purchase from the Company up to ____________________ ([ ]) [10%
      of shares sold in offering] shares
      of
      Common Stock (such shares underlying this Warrant, the “Warrant
      Shares”),
      at a
      per share purchase price equal to $[ ] [120%
      of initial public offering price]
      (the
“Exercise
      Price”),
      subject to the terms, conditions and adjustments set forth below in this
      Warrant. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1. Date
      of Warrant Exercise.
      This
      Warrant shall become exercisable on the date that is one (1) year from the
      Base
      Date (the “Exercise
      Date”).
      As
      used in this Warrant, the term “Base
      Date”
shall
      mean ____________________, 2007. Except as otherwise provided for herein or
      as
      permitted by applicable rules of the Financial Industry Regulatory Authority,
      Inc. (“FINRA”),
      this
      Warrant shall not be sold, transferred, assigned, pledged or hypothecated prior
      to the Exercise Date.

    

    2.
       Expiration
      of Warrant.
      This
      Warrant shall expire on the five (5) year anniversary of the Base Date (the
      “Expiration
      Date”).

    

    3.
       Exercise
      of Warrant.
      This
      Warrant shall be exercisable pursuant to the terms of this Section
      3.

    

    3.1
       Manner
      of Exercise.
      

    

    (a) This
      Warrant may only be exercised by the Holder hereof on or after the Exercise
      Date
      and on or prior to the Expiration Date, in accordance with the terms and
      conditions hereof, in whole or in part (but not as to fractional shares) with
      respect to any portion of this Warrant, during the Company’s normal business
      hours on any day other than a Saturday or a Sunday or a day on which commercial
      banking institutions in New York, New York are authorized by law to be closed
      (a
“Business
      Day”),
      by
      surrender of this Warrant to the Company at its office maintained pursuant
      to
      Section 10.2(a) hereof, accompanied by a written exercise notice in the form
      attached as Exhibit
      A
      to this
      Warrant (or a reasonable facsimile thereof) duly executed by the Holder,
      together with the payment of the aggregate Exercise Price for the number of
      Warrant Shares purchased upon exercise of this Warrant. Upon surrender of this
      Warrant, the Company shall promptly cancel this Warrant document and shall,
      in
      the event of partial exercise, replace it with a new Warrant document in
      accordance with Section 3.3

    

    (b) Except
      as
      provided for in Section 3.1(c) below, each exercise of this Warrant must be
      accompanied by payment in full of the aggregate Exercise Price in cash by check
      or wire transfer in immediately available funds for the number of Warrant Shares
      being purchased by the Holder upon such exercise. 

    

    (c) The
      aggregate Exercise Price for the number of Warrant Shares being purchased may
      also, in the sole discretion of the Holder, be paid in full or in part on a
      “cashless basis” at the election of the Holder: 

    

    (i)
       in
      the
      form of Common Stock owned by the Holder (based on the Fair Market Value (as
      defined below) of such Common Stock on the date of exercise);

    

    (ii)
       in
      the
      form of Warrant Shares withheld by the Company from the Warrant Shares otherwise
      to be received upon exercise of this Warrant having an aggregate Fair Market
      Value on the date of exercise equal to the aggregate Exercise Price of the
      Warrant Shares being purchased by the Holder; or 

    
       

      
        
          
          

        

        
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    (iii)
       by
      a
      combination of the foregoing, provided that the combined value of all cash
      and
      the Fair Market Value of any shares surrendered to the Company is at least
      equal
      to the aggregate Exercise Price for the number of Warrant Shares being purchased
      by the Holder.

    

    For
      purposes of this Warrant, the term “Fair
      Market Value”
means
      with respect to a particular date, the average closing price of the Common
      Stock
      for the five (5) trading days immediately preceding the applicable exercise
      herein as officially reported by the principal securities exchange on which
      the
      Common Stock is then listed or admitted to trading, or, if the Common Stock
      is
      not listed or admitted to trading on any securities exchange as determined
      in
      good faith by resolution of the Board of Directors of the Company, based on
      the
      best information available to it.

    

    For
      purposes of illustration of a cashless exercise of this Warrant under Section
      3.1(c)(ii) (or for a portion thereof for which cashless exercise treatment
      is
      requested as contemplated by Section 3.1(c)(iii) hereof), the calculation of
      such exercise shall be as follows:

    

    X
      = Y (A-B)/A

    

    where:

    

    X
      =  the
      number of Warrant
      Shares to be issued to the Holder (rounded to the nearest whole
      share).

    

    Y
      =  the
      number of Warrant
      Shares with respect to which this Warrant
      is being exercised.

    

    A
      =  the
      Fair Market Value of the Common Stock.

    

    B
      =  the
      Exercise Price.

    

    (d) For
      purposes of Rule 144 and sub-section (d)(3)(ii) thereof, it is intended,
      understood, and acknowledged that the Common Stock issuable upon exercise of
      this Warrant in a cashless exercise transaction as described in Section 3.1(c)
      above shall be deemed to have been acquired at the time this Warrant was issued.
      Moreover, it is intended, understood, and acknowledged that the holding period
      for the Common Stock issuable upon exercise of this Warrant in a cashless
      exercise transaction as described in Section 3.1(c) above shall be deemed to
      have commenced on the date this Warrant was issued.

    

    3.2 When
      Exercise Effective.
      Each
      exercise of this Warrant shall be deemed to have been effected immediately
      prior
      to the close of business on the Business Day on which this Warrant shall have
      been duly surrendered to the Company as provided in Sections 3.1 and 12 hereof,
      and, at such time, the Holder in whose name any certificate or certificates
      for
      Warrant Shares shall be issuable upon exercise as provided in Section 3.3 hereof
      shall be deemed to have become the holder or holders of record thereof of the
      number of Warrant Shares purchased upon exercise of this Warrant.

    
       

      
        
          
          

        

        
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    3.3 Delivery
      of Common Stock Certificates and New Warrant.
      As soon
      as reasonably practicable after each exercise of this Warrant, in whole or
      in
      part, and in any event within five (5) Business Days thereafter, the Company,
      at
      its expense (including the payment by it of any applicable issue taxes), will
      cause to be issued in the name of and delivered to the Holder hereof or, subject
      to Sections 9 and 10 hereof, as the Holder (upon payment by the Holder of any
      applicable transfer taxes) may direct:

    

    (a) a
      certificate or certificates (with appropriate restrictive legends, as
      applicable) for the number of duly authorized, validly issued, fully paid and
      nonassessable Warrant Shares to which the Holder shall be entitled upon
      exercise; and 

    

    (b) in
      case
      exercise is in part only, a new Warrant document of like tenor, dated the date
      hereof, for the remaining number of Warrant Shares issuable upon exercise of
      this Warrant after giving effect to the partial exercise of this Warrant
      (including the delivery of any Warrant Shares as payment of the Exercise Price
      for such partial exercise of this Warrant). 

    

    4. Certain
      Adjustments.
      For so
      long as this Warrant is outstanding:

    

    4.1 Mergers
      or Consolidations.
      If at
      any time after the date hereof there shall be a capital reorganization (other
      than a combination or subdivision of Common Stock otherwise provided for herein)
      resulting in a reclassification to or change in the terms of securities issuable
      upon exercise of this Warrant (a “Reorganization”),
      or a
      merger or consolidation of the Company with another corporation, association,
      partnership, organization, business, individual, government or political
      subdivision thereof or a governmental agency (a “Person”
or
      the
“Persons”)
      (other
      than a merger with another Person in which the Company is a continuing
      corporation and which does not result in any reclassification or change in
      the
      terms of securities issuable upon exercise of this Warrant or a merger effected
      exclusively for the purpose of changing the domicile of the Company) (a
“Merger”),
      then,
      as a part of such Reorganization or Merger, lawful provision and adjustment
      shall be made so that the Holder shall thereafter be entitled to receive, upon
      exercise of this Warrant, the number of shares of stock or any other equity
      or
      debt securities or property receivable upon such Reorganization or Merger by
      a
      holder of the number of shares of Common Stock which might have been purchased
      upon exercise of this Warrant immediately prior to such Reorganization or
      Merger. In any such case, appropriate adjustment shall be made in the
      application of the provisions of this Warrant with respect to the rights and
      interests of the Holder after the Reorganization or Merger to the end that
      the
      provisions of this Warrant (including adjustment of the Exercise Price then
      in
      effect and the number of Warrant Shares) shall be applicable after that event,
      as near as reasonably may be, in relation to any shares of stock, securities,
      property or other assets thereafter deliverable upon exercise of this Warrant.
      The provisions of this Section 4.1 shall similarly apply to successive
      Reorganizations and/or Mergers.

    

    4.2 Splits
      and Subdivisions; Dividends.
      In the
      event the Company should at any time or from time to time effectuate a split
      or
      subdivision of the outstanding shares of Common Stock or pay a dividend in
      or
      make a distribution payable in additional shares of Common Stock or Common
      Stock
      Equivalents without payment of any consideration by such holder for the
      additional shares of Common Stock or Common Stock Equivalents (including the
      additional shares of Common Stock issuable upon conversion or exercise thereof),
      then, as of the applicable record date (or the date of such distribution, split
      or subdivision if no record date is fixed), the per share Exercise Price shall
      be appropriately decreased and the number of Warrant Shares shall be
      appropriately increased in proportion to such increase (or potential increase)
      of outstanding shares; provided, however, that no adjustment shall be made
      in
      the event the split, subdivision, dividend or distribution is not effectuated.
      

    
       

      
        
          
          

        

        
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    4.3 Combination
      of Shares.
      If the
      number of shares of Common Stock outstanding at any time after the date hereof
      is decreased by a combination of the outstanding shares of Common Stock, the
      per
      share Exercise Price shall be appropriately increased and the number of shares
      of Warrant Shares shall be appropriately decreased in proportion to such
      decrease in outstanding shares. 

    

    4.4 Adjustments
      for Other Distributions.
      In the
      event the Company shall declare a distribution payable in securities of other
      Persons, evidences of indebtedness issued by the Company or other Persons,
      assets (excluding cash dividends or distributions to the holders of Common
      Stock
      paid out of current or retained earnings and declared by the Company’s board of
      directors) or options or rights not referred to in Sections 4.2, 4.3 or 4.4,
      then, in
      each such case for the purpose of this Section 4.5, upon exercise of this
      Warrant, the Holder shall be entitled to a proportionate share of any such
      distribution as though the Holder was the actual record holder of the number
      of
      Warrant Shares as of the record date fixed for the determination of the holders
      of Common Stock of the Company entitled to receive such distribution.

    

    5. No
      Impairment.
      The
      Company will not, by amendment of its articles of incorporation or by-laws
      or
      through any consolidation, merger, reorganization, transfer of assets,
      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 of the
      terms and in the taking of all actions necessary or appropriate in order to
      protect the rights of the Holder against impairment. 

    

    6. Chief
      Financial Officer’s Report as to Adjustments.
      With
      respect to each adjustment pursuant to Section 4 of this Warrant, the Company,
      at its expense, will promptly compute the adjustment or re-adjustment in
      accordance with the terms of this Warrant and cause its Chief Financial Officer
      to certify the computation (other than any computation of the fair value of
      property of the Company, as the case may be) and prepare a report setting forth,
      in reasonable detail, the event requiring the adjustment or re-adjustment and
      the amount of such adjustment or re-adjustment, the method of calculation
      thereof and the facts upon which the adjustment or re-adjustment is based,
      and
      the Exercise Price and the number of Warrant Shares or other securities
      purchasable hereunder after giving effect to such adjustment or re-adjustment,
      which report shall be mailed by first class mail, postage prepaid to the Holder.
      The Company will also keep copies of all reports at its office maintained
      pursuant to Section 10.2(a) hereof and will cause them to be available for
      inspection at the office during normal business hours upon reasonable notice
      by
      the Holder or any prospective purchaser of the Warrant designated by the Holder
      thereof. 

    
       

      
        
          
          

        

        
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    7. Reservation
      of Shares.
      The
      Company shall, solely for the purpose of effecting the exercise of this Warrant,
      at all times during the term of this Warrant, reserve and keep available out
      of
      its authorized shares of Common Stock, free from all taxes, liens and charges
      with respect to the issue thereof and not subject to preemptive rights or other
      similar rights of shareholders of the Company, such number of its shares of
      Common Stock as shall from time to time be sufficient to effect in full the
      exercise of this Warrant. If at any time the number of authorized but unissued
      shares of Common Stock shall not be sufficient to effect in full the exercise
      of
      this Warrant, in addition to such other remedies as shall be available to
      Holder, the Company will promptly take such corporate action as may, in the
      opinion of its counsel, be necessary to increase the number of authorized but
      unissued shares of Common Stock to such number of shares as shall be sufficient
      for such purposes, including without limitation, using its Reasonable Best
      Efforts (as defined in Section 14 hereof) to obtain the requisite shareholder
      approval necessary to increase the number of authorized shares of Common Stock.
      The Company hereby represents and warrants that all shares of Common Stock
      issuable upon exercise of this Warrant shall be duly authorized and, when issued
      and paid for upon exercise, shall be validly issued, fully paid and
      nonassessable.

    

    8. Registration
      and Listing.
      

    

    8.1 Definition
      of Registrable Securities; Majority.
      As used
      herein, the term “Registrable
      Securities”
means
      any shares of Common Stock issuable upon the exercise of this Warrant, until
      the
      date (if any) on which such shares shall have been transferred or exchanged
      and
      new certificates for them not bearing a legend restricting further transfer
      shall have been delivered by the Company and subsequent disposition of them
      shall not require registration or qualification of them under the Securities
      Act
      or any similar state law then in force. For purposes of this Warrant, the term
      “Majority”,
      in
      reference to the holders of Registrable Securities, shall mean in excess of
      fifty percent (50%) of the then outstanding Warrant Shares (assuming the
      exercise of the entire Warrant) that: (i) are not held by the Company, an
      affiliate, officer, creditor, employee or agent thereof or any of their
      respective affiliates, members of their family, Persons acting as nominees
      or in
      conjunction therewith and (ii) have not be resold to the public pursuant to
      a
      registration statement filed under the Securities Act. When used herein, the
      term “Reasonable
      Best Efforts”
means,
      with respect to the applicable obligation of the Company, reasonable best
      efforts for similarly situated, publicly-traded companies.

    

    8.2 Required
      Registration.
      

    

    (a) At
      any
      time on or after the Exercise Date and on or before the five (5) year
      anniversary of the Base Date, but in no event on more than one (1) occasion,
      upon the written request of the holders of the Registrable Securities
      representing a Majority of such Registrable Securities, the Company will use
      its
      Reasonable Best Efforts to effect the registration of the respective shares
      of
      the holders of Registrable Securities under the Securities Act to
      the extent requisite to permit the public disposition thereof as expeditiously
      as reasonably
      possible, but in no event later than 120 days from the date of such
      request.

    

    (b) Registration
      of Registrable Securities under this Section 8.2 shall be on such appropriate
      registration form: (i) as shall be selected by the Company, and (ii) as shall
      permit the public disposition of such Registrable Securities in accordance
      with
      this Section 8.2. The Company agrees to include in any such registration
      statement all information which the requesting holders of Registrable Securities
      shall reasonably request, which is required to be contained therein. The Company
      will pay all Registration Expenses in connection with each registration of
      Registrable Securities pursuant to this Section 8.2.

    
       

      
        
          
          

        

        
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    (c) A
      registration requested pursuant to this Section 8.2 shall not be deemed to
      have
      been effected: (i) unless a registration statement with respect thereto has
      become effective or (ii) if, after it has become effective, such registration
      is
      interfered with by any stop order, injunction or other order or requirement
      of
      the Securities and Exchange Commission (the “SEC”)
      or
      other governmental agency or court of competent jurisdiction for any reason,
      other than by reason of some act or omission by a holder of Registrable
      Securities.

    

    8.3 Incidental
      Registration Rights.

    

    (a) If
      the
      Company, at any time on or after the Exercise Date and on or before the seven
      (7) year anniversary of the Base Date, proposes to register any of its
      securities under the Securities Act (other than in connection with a
      registration on Form S-4 or S-8 or any successor forms) whether for its own
      account or for the account of any holder or holders of its shares other than
      Registrable Securities (any shares of such holder or holders (but not those
      of
      the Company and not Registrable Securities) with respect to any registration
      are
      referred to herein as, “Other
      Shares”),
      the
      Company shall each such time give prompt (but not less than thirty (30) days
      prior to the anticipated effectiveness thereof) written notice to the holders
      of
      Registrable Securities of its intention to do so. Upon the written request
      of
      any such holder of Registrable Securities made within twenty (20) days after the
      receipt of any such notice (which request shall specify the Registrable
      Securities intended to be disposed of by such holder), except as set forth
      in
      Section 8.3(b), the Company will use its Reasonable Best Efforts to effect
      the
      registration under the Securities Act of all of the Registrable Securities
      which
      the Company has been so requested to register by such holder, to the extent
      requisite to permit the disposition of the Registrable Securities so to be
      registered, by inclusion of such Registrable Securities in the registration
      statement which covers the securities which the Company proposes to register;
      provided,
      however,
      that if,
      at any time after giving written notice of its intention to register any
      securities and prior to the effective date of the registration statement filed
      in connection with such registration, the Company shall determine for any reason
      in its sole discretion either to not register, to delay or to withdraw
      registration of such securities, the Company may, at its election, give written
      notice of such determination to such holder and, thereupon: (i) in the case
      of a
      determination not to register, shall be relieved of its obligation to register
      any Registrable Securities in connection with such registration (but not from
      its obligation to pay the Registration Expenses in connection therewith),
      without prejudice, however, to the rights of the holders of Registrable
      Securities entitled to request that such registration be effected as a
      registration under Section 8.2, (ii) in the case of a determination to delay
      registration, shall be permitted to delay registering any Registrable Securities
      for the same period as the delay in registering such other securities (including
      the Other Shares), without prejudice, however, to the rights of the holders
      of
      Registrable Securities entitled to request that such registration be effected
      as
      a registration under Section 8.2 and (iii) in the case of a determination to
      withdraw registration, shall be permitted to withdraw registration, without
      prejudice, however, to the rights of the holders of Registrable Securities
      entitled to request that such registration be effected as a registration under
      Section 8.2. No registration effected under this Section 8.3 shall relieve
      the
      Company of its obligation to effect any registration upon request under Section
      8.2, nor shall any such registration hereunder be deemed to have been effected
      pursuant to Section 8.2. The Company will pay all Registration Expenses in
      connection with each registration of Registrable Securities pursuant to this
      Section 8.3. 

    
       

      
        
          
          

        

        
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    (b) If
      the
      Company at any time proposes to register any of its securities under the
      Securities Act as contemplated by this Section 8.3 and such securities are
      to be
      distributed by or through one or more underwriters, the Company will, if
      requested by a holder of Registrable Securities, use its Reasonable Best Efforts
      to arrange for such underwriters to include all the Registrable Securities
      to be
      offered and sold by such holder among the securities to be distributed by such
      underwriters, provided that if the managing underwriter of such underwritten
      offering shall inform the Company by letter of its belief that inclusion in
      such
      distribution of all or a specified number of such securities proposed to be
      distributed by such underwriters would interfere with the successful marketing
      of the securities being distributed by such underwriters (such letter to state
      the basis of such belief and the approximate number of such Registrable
      Securities, such Other Shares and shares held by the Company proposed so to
      be
      registered which may be distributed without such effect), then the Company
      may,
      upon written notice to such holder, the other holders of Registrable Securities,
      and holders of such Other Shares reduce the number of shares of Common Stock
      to
      be included in such registration so that the resulting aggregate number of
      such
      Registrable Securities and Other Shares so included in such registration,
      together with the number of securities to be included in such registration
      for
      the account of the Company, shall be equal to the number of shares stated in
      such managing underwriter’s letter. Such reductions shall be made as follows:
      (i) in the case of a registration initiated by the Company for its own account:
      (A) the Company shall first reduce pro rata in accordance with the number of
      shares of Common Stock desired to be included in such registration the number
      of
      such Registrable Securities and Other Shares the registration of which shall
      have been requested by each holder thereof, and (B) thereafter, if additional
      shares must be excluded from such registration, shares to be issued by the
      Company shall be excluded, and (ii) in the case of a registration initiated
      by
      the Company for the account of a holder or holders of Other Shares: (A) the
      Company shall first reduce the number of shares to be issued by the Company,
      and
      (B) thereafter, if additional shares must be excluded from such registration,
      the Company shall reduce pro rata in accordance with the number of shares of
      Common Stock desired to be included in such registration the number of such
      Registrable Securities and Other Shares (other than Other Shares held by the
      initiating holder or holders) the registration of which shall have been
      requested by each holder thereof, and (C) thereafter, if additional shares
      must
      be excluded from such registration, Other Shares held by the initiating holder
      or holders shall be excluded pro rata in accordance with the number of Other
      Shares the registration of which shall have been requested by such initiating
      holder or holders.

    

    8.4 Registration
      Procedures.
      Whenever the holders of Registrable Securities have properly requested that
      any
      Registrable Securities be registered pursuant to the terms of this Warrant,
      the
      Company shall use its Reasonable Best Efforts to effect the registration and
      the
      sale of such Registrable Securities in accordance with the intended method
      of
      disposition thereof, and pursuant thereto the Company shall as expeditiously
      as
      possible:

    
       

      
        
          
          

        

        
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    (a) prepare
      and file with the SEC a registration statement with respect to such Registrable
      Securities and use its Reasonable Best Efforts to cause such registration
      statement to become effective;

     

    (b) notify
      such holders of the effectiveness of each registration statement filed hereunder
      and prepare and file with the SEC such amendments and supplements to such
      registration statement and the prospectus used in connection therewith as may
      be
      necessary to (i) keep such registration statement effective and the prospectus
      included therein usable for a period commencing on the date that such
      registration statement is initially declared effective by the SEC and ending
      on
      the date when all Registrable Securities covered by such registration statement
      have been sold pursuant to the registration statement or cease to be Registrable
      Securities, and (ii) comply with the provisions of the Securities Act with
      respect to the disposition of all securities covered by such registration
      statement during such period in accordance with the intended methods of
      disposition by the sellers thereof set forth in such registration
      statement;

    

    (c) furnish
      to such holders such number of copies of such registration statement, each
      amendment and supplement thereto, the prospectus included in such registration
      statement (including each preliminary prospectus) and such other documents
      as
      such seller may reasonably request in order to facilitate the disposition of
      the
      Registrable Securities owned by such holders;

    

    (d) use
      its
      Reasonable Best Efforts to register or qualify such Registrable Securities
      under
      such other securities or blue sky laws of such jurisdictions as such holders
      reasonably request and do any and all other acts and things which may be
      reasonably necessary or advisable to enable such holders to consummate the
      disposition in such jurisdictions of the Registrable Securities owned by such
      holders; provided,
      however,
      that the
      Company shall not be required to: (i) qualify generally to do business in any
      jurisdiction where it would not otherwise be required to qualify but for this
      subparagraph; (ii) subject itself to taxation in any such jurisdiction; or
      (iii)
      consent to general service of process in any such jurisdiction;

    

    (e) notify
      such holders, at any time when a prospectus relating thereto is required to
      be
      delivered under the Securities Act, of the happening of any event as a result
      of
      which the prospectus included in such registration statement contains an untrue
      statement of a material fact or omits any material fact necessary to make the
      statements therein, in light of the circumstances in which they are made, not
      materially misleading, and, at the reasonable request of such holders, the
      Company shall prepare a supplement or amendment to such prospectus so that,
      as
      thereafter delivered to the purchasers of such Registrable Securities, such
      prospectus shall not contain an untrue statement of a material fact or omit
      to
      state any material fact necessary to make the statements therein, in light
      of
      the circumstances in which they are made, not materially
      misleading;

    

    (f) provide
      a
      transfer agent and registrar for all such Registrable Securities not later
      than
      the effective date of such registration statement;

    

    (g) make
      available for inspection by any underwriter participating in any disposition
      pursuant to such registration statement, and any attorney, accountant or other
      agent retained by any such underwriter, all financial and other records,
      pertinent corporate documents and properties of the Company, and cause the
      Company’s officers, directors, managers, employees and independent accountants
      to supply all information reasonably requested by any such underwriter,
      attorney, accountant or agent in connection with such registration
      statement;

    
       

      
        
          
          

        

        
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    (h) otherwise
      use its Reasonable Best Efforts to comply with all applicable rules and
      regulations of the SEC, and make available to its security holders, as soon
      as
      reasonably practicable, an earnings statement of the Company, which earnings
      statement shall satisfy the provisions of Section 11(a) of the Securities Act
      and, at the option of the Company, Rule 158 thereunder;

    

    (i) in
      the
      event of the issuance of any stop order suspending the effectiveness of a
      registration statement, or of any order suspending or preventing the use of
      any
      related prospectus or suspending the qualification of any Registrable Securities
      included in such registration statement for sale in any jurisdiction, the
      Company shall use its Reasonable Best Efforts promptly to obtain the withdrawal
      of such order;

    

    (j) use
      its
      Reasonable Best Efforts to cause any Registrable Securities covered by such
      registration statement to be registered with or approved by such other
      governmental agencies or authorities as may be necessary to enable the sellers
      thereof to consummate the disposition of such Registrable Securities;
      and

    

    (k) if
      the
      offering is underwritten, use its Reasonable Best Efforts to furnish on the
      date
      that Registrable Securities are delivered to the underwriters for sale pursuant
      to such registration, an opinion dated such date of counsel representing the
      Company for the purposes of such registration, addressed to the underwriters
      covering such issues as are reasonably required by such
      underwriters.

    

    8.5 Listing.
      The
      Company shall secure the listing of the Common Stock underlying this Warrant
      upon each national securities exchange or automated quotation system upon which
      shares of Common Stock are then listed or quoted (subject to official notice
      of
      issuance) and shall maintain such listing of shares of Common Stock. The Company
      shall at all times comply in all material respects with the Company’s reporting,
      filing and other obligations under the by-laws or rules of the American Stock
      Exchange (or such other national securities exchange or market on which the
      Common Stock may then be listed, as applicable).

    

    8.6 Expenses.
      The Company shall pay all Registration Expenses relating to the registration
      and
      listing obligations set forth in this Section 8. For purposes of this Warrant,
      the term “Registration
      Expenses”
      means: (a)
      all
      registration, filing and FINRA fees, (b) all reasonable fees and expenses of
      complying with securities or blue sky laws, (c) all word processing, duplicating
      and printing expenses, (d) the fees and disbursements of counsel for the Company
      and of its independent public accountants, including the expenses of any special
      audits or “cold comfort” letters required by or incident to such performance and
      compliance, (e) premiums and other costs of policies of insurance (if any)
      against liabilities arising out of the public offering of the Registrable
      Securities being registered if the Company desires such insurance, if any,
      and
      (f) fees and disbursements of one counsel for the selling holders of Registrable
      Securities; provided
      however,
      that, in
      any case where Registration Expenses are not to be borne by the Company, such
      expenses shall not include (and such expenses shall be borne by the Company):
      (i) salaries of Company personnel or general overhead expenses of the Company,
      (ii) auditing fees, (iii) premiums or other expenses relating to liability
      insurance required by underwriters of the Company, or (iv) other expenses for
      the preparation of financial statements or other data, to the extent that any
      of
      the foregoing either is normally prepared by the Company in the ordinary course
      of its business or would have been incurred by the Company had no public
      offering taken place. Registration Expenses shall not include any underwriting
      discounts and commissions which may be incurred in the sale of any Registrable
      Securities and transfer taxes of the selling holders of Registrable
      Securities.

    
       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

    

    8.7 Information
      Provided by Holders.
      Any
      holder of Registrable Securities included in any registration shall furnish
      to
      the Company such information as the Company may reasonably request in writing
      to
      enable the Company to comply with the provisions hereof in connection with
      any
      registration referred to in this Warrant.

     

    8.8 FINRA
      CobraDesk Filings.
      In the
      event that a registration statement covering the Registrable Securities is
      filed, within one (1) Business Day of the filing of such registration statement,
      the Company will prepare and file the selling stockholder resale offering
      described in such registration statement for review by FINRA via FINRA’s
      CobraDesk filing system (“CobraDesk
      Filing”)
      for
      the purpose of having the prospectus contained within such registration
      statement treated as a “base prospectus” in connection with such resale
      offering. The Company will use its Reasonable Best Efforts to have the CobraDesk
      Filing approved by the FINRA within thirty (30) days of such filing date. The
      Company shall bear all expenses of the CobraDesk Filing, including fees and
      expenses of counsel or other advisors to the Holder. In all circumstances,
      the
      Company shall pay for all FINRA filing fees associated with the CobraDesk
      Filing. 

    

    8.9 Effectiveness
      Period.
      The
      Company shall use its Reasonable Best Efforts to keep each registration
      statement contemplated hereunder continuously effective under the Securities
      Act
      until the date which is the earlier date of when (i) all Registrable Securities
      covered by such Registration Statement have been sold or (ii) all Registrable
      Securities covered by such Registration Statement may be sold immediately
      without registration under the Securities Act and without volume restrictions
      pursuant to Rule 144(k) under the Securities Act, as determined by the counsel
      to the Company pursuant to a written opinion letter to such effect, addressed
      and reasonably acceptable to the Company’s transfer agent and the affected
      holders of Registrable Securities.

    

    8.10 Net
      Cash Settlement.
      Notwithstanding anything herein to the contrary, in no event will the Holder
      hereof be entitled to receive a net-cash settlement as liquidated damages in
      lieu of physical settlement in shares of Common Stock, regardless of whether
      the
      Common Stock underlying this Warrant is registered pursuant to an effective
      registration statement; provided, however, that the foregoing will not preclude
      the Holder from seeking other remedies at law or equity for breaches by the
      Company of its registration obligations hereunder.

    
       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

    

    9. Restrictions
      on Transfer.

    

    9.1 Restrictive
      Legends.
      This
      Warrant and each Warrant issued upon transfer or in substitution for this
      Warrant pursuant to Section 10 hereof, each certificate for Common Stock issued
      upon the exercise of the Warrant and each certificate issued upon the transfer
      of any such Common Stock shall be transferable only upon satisfaction of the
      conditions specified in this Section 9. Each of the foregoing securities shall
      be stamped or otherwise imprinted with a legend reflecting the restrictions
      on
      transfer set forth herein and any restrictions required under the Securities
      Act
      or other applicable securities laws.

    

    9.2 Notice
      of Proposed Transfer.
      Prior
      to any transfer of any securities which are not registered under an effective
      registration statement under the Securities Act (“Restricted
      Securities”),
      which
      transfer may only occur if there is an exemption from the registration
      provisions of the Securities Act and all other applicable securities laws,
      the
      Holder will give written notice to the Company of the Holder’s intention to
      effect a transfer (and shall describe the manner and circumstances of the
      proposed transfer). The following provisions shall apply to any proposed
      transfer of Restricted Securities:

    

    (i) If
      in the
      opinion of counsel for the Holder reasonably satisfactory to the Company the
      proposed transfer may be effected without registration of the Restricted
      Securities under the Securities Act (which opinion shall state in detail the
      basis of the legal conclusions reached therein), the Holder shall thereupon
      be
      entitled to transfer the Restricted Securities in accordance with the terms
      of
      the notice delivered by the Holder to the Company. Each certificate representing
      the Restricted Securities issued upon or in connection with any transfer shall
      bear the restrictive legends required by Section 9.1 hereof.

    

    (ii) If
      the
      opinion called for in (i) above is not delivered, the Holder shall not be
      entitled to transfer the Restricted Securities until either: (x) receipt by
      the
      Company of a further notice from such Holder pursuant to the foregoing
      provisions of this Section 9.2 and fulfillment of the provisions of clause
      (i)
      above, or (y) such Restricted Securities have been effectively registered under
      the Securities Act.

    

    9.3 Certain
      Other Transfer Restrictions.
      Notwithstanding any other provision of this Section 9: (i) prior to the Exercise
      Date, this Warrant or the Restricted Securities thereunder may only be
      transferred or assigned to the persons permitted under FINRA Rule 2710(g),
      and
      (ii) no opinion of counsel shall be necessary for a transfer of Restricted
      Securities by the holder thereof to any Person employed by or owning equity
      in
      the Holder, if the transferee agrees in writing to be subject to the terms
      hereof to the same extent as if the transferee were the original purchaser
      hereof and such transfer is permitted under applicable securities laws.

    

    9.4
       Termination
      of Restrictions.
      Except
      as set forth in Section 9.3 hereof, the restrictions imposed by this Section
      9
      upon the transferability of Restricted Securities shall cease and terminate
      as
      to any particular Restricted Securities: (a) which shall have been effectively
      registered under the Securities Act, or (b) when, in the opinions of both
      counsel for the holder thereof and counsel for the Company, such restrictions
      are no longer required in order to insure compliance with the Securities Act
      or
      Section 10 hereof. Whenever such restrictions shall cease and terminate as
      to
      any Restricted Securities, the Holder thereof shall be entitled to receive
      from
      the Company, without expense (other than applicable transfer taxes, if any),
      new
      securities of like tenor not bearing the applicable legends required by Section
      9.1 hereof.

    
       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

    

    10.
       Ownership,
      Transfer, Sale and Substitution of Warrant.

    

    10.1 Ownership
      of Warrant.
      The
      Company may treat any Person in whose name this Warrant is registered in the
      Warrant Register maintained pursuant to Section 10.2(b) hereof as the owner
      and
      holder thereof for all purposes, notwithstanding any notice to the contrary,
      except that, if and when any Warrant is properly assigned in blank, the Company
      may (but shall not be obligated to) treat the bearer thereof as the owner of
      such Warrant for all purposes, notwithstanding any notice to the contrary.
      Subject to Sections 9 and 10 hereof, this Warrant, if properly assigned, may
      be
      exercised by a new holder without a new Warrant first having been issued.

    

    10.2 Office;
      Exchange of Warrant.

    

    (a) The
      Company will maintain its principal office at the location identified in the
      prospectus relating to the Offering or at such other offices as set forth in
      the
      Company’s most current filing (as of the date notice is to be given) under the
      Exchange Act or as the Company otherwise notifies the Holder.

    

    (b) The
      Company shall cause to be kept at its office maintained pursuant to Section
      10.2(a) hereof a Warrant Register for the registration and transfer of the
      Warrant. The name and address of the holder of the Warrant, the transfers
      thereof and the name and address of the transferee of the Warrant shall be
      registered in such Warrant Register. The Person in whose name the Warrant shall
      be so registered shall be deemed and treated as the owner and holder thereof
      for
      all purposes of this Warrant, and the Company shall not be affected by any
      notice or knowledge to the contrary.

    

    (c) Upon
      the
      surrender of this Warrant, properly endorsed, for registration of transfer
      or
      for exchange at the office of the Company maintained pursuant to Section 10.2(a)
      hereof, the Company at its expense will (subject to compliance with Section
      9
      hereof, if applicable) execute and deliver to or upon the order of the Holder
      thereof a new Warrant of like tenor, in the name of such holder or as such
      holder (upon payment by such holder of any applicable transfer taxes) may
      direct, calling in the aggregate on the face thereof for the number of shares
      of
      Common Stock called for on the face of the Warrant so surrendered (after giving
      effect to any previous adjustment(s) to the number of Warrant
      Shares).

    

    10.3
       Replacement
      of Warrant.
      Upon
      receipt of evidence reasonably satisfactory to the Company of the loss, theft,
      destruction or mutilation of this Warrant and, in the case of any such loss,
      theft or destruction of this Warrant, upon delivery of indemnity reasonably
      satisfactory to the Company in form and amount or, in the case of any
      mutilation, upon surrender of this Warrant for cancellation at the office of
      the
      Company maintained pursuant to Section 10.2(a) hereof, the Company, at its
      expense, will execute and deliver, in lieu thereof, a new Warrant of like tenor
      and dated the date hereof.

    
       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

    

    10.4 Opinions.
      In
      connection with the sale of the Warrant Shares by Holder, the Company agrees
      to
      cooperate with the Holder, and at the Company’s expense, have its counsel
      provide any legal opinions required to remove the restrictive legends from
      the
      Warrant Shares in connection with a sale, transfer or legend removal request
      of
      Holder. 

    

    11.
       No
      Rights or Liabilities as Stockholder.
      No
      Holder shall be entitled to vote or receive dividends or be deemed the holder
      of
      any shares of Common Stock or any other securities of the Company which may
      at
      any time be issuable on the exercise hereof for any purpose, nor shall anything
      contained herein be construed to confer upon the Holder, as such, any of the
      rights of a stockholder of the Company or any right to vote for the election
      of
      directors or upon any matter submitted to stockholders at any meeting thereof,
      or to give or withhold consent to any corporate action (whether upon any
      recapitalization, issuance of stock, reclassification of stock, change of par
      value, consolidation, merger, conveyance, or otherwise) or to receive notice
      of
      meetings, or to receive dividends or subscription rights or otherwise until
      the
      Warrant shall have been exercised and the shares of Common Stock purchasable
      upon the exercise hereof shall have become deliverable, as provided herein.
      The
      Holder will not be entitled to share in the assets of the Company in the event
      of a liquidation, dissolution or the winding up of the Company.

    

    12.
       Notices.
      Any
      notice or other communication in connection with this Warrant shall be given
      in
      writing and directed to the parties hereto as follows: (a) if to the Holder,
      at
      the most recent publicly published address for such Holder; or (b) if to the
      Company, to the attention of its Chief Executive Officer at its office
      maintained pursuant to Section 10.2(a) hereof; provided,
      that the
      exercise of the Warrant shall also be effected in the manner provided in Section
      3 hereof. Notices shall be deemed properly delivered and received when delivered
      to the notice party (i) if personally delivered, upon receipt or refusal to
      accept delivery, (ii) if sent via facsimile, upon mechanical confirmation of
      successful transmission thereof generated by the sending telecopy machine,
      (iii)
      if sent by a commercial overnight courier for delivery on the next Business
      Day,
      on the first Business Day after deposit with such courier service, or (iv)
      if
      sent by registered or certified mail, five (5) Business Days after deposit
      thereof in the U.S. mail.

    

    13. Payment
      of Taxes.
      The
      Company will pay all documentary stamp taxes attributable to the issuance of
      shares of Common Stock underlying this Warrant upon exercise of this Warrant;
      provided,
      however,
      that the
      Company shall not be required to pay any tax which may be payable in respect
      of
      any transfer involved in the transfer or registration of this Warrant or any
      certificate for shares of Common Stock underlying this Warrant in a name other
      that of the Holder. The Holder is responsible for all other tax liability that
      may arise as a result of holding or transferring this Warrant or receiving
      shares of Common Stock underlying this Warrant upon exercise
      hereof.

    

    14.
       Miscellaneous.
      This
      Warrant and any term hereof may be changed, waived, discharged or terminated
      only by an instrument in writing signed by the party against which enforcement
      of the change, waiver, discharge or termination is sought. This Warrant shall
      be
      construed and enforced in accordance with and governed by the laws of the State
      of New Jersey. The section headings in this Warrant are for purposes of
      convenience only and shall not constitute a part hereof. 

    
       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

    

    IN
      WITNESS WHEREOF,
      the
      Company has caused this Underwriters’ Warrant to be duly executed as of the date
      first above written.

    

    

    EYETEL
      IMAGING, INC.

     

     

    By:
      _____________________________

    Name:

    Title:

    

    

    

    

    

    

    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

    FORM
      OF EXERCISE NOTICE

    [To
      be
      executed only upon exercise of Warrant]

    

    To
      EYETEL
      IMAGING, INC.:

    

    The
      undersigned registered holder of the within Warrant hereby irrevocably exercises
      the Warrant pursuant to Section 3.1 of the Warrant with respect to
      ________________________ Warrant Shares, at an exercise price per share of
      $[ ],
      and requests that the certificates for such Warrant Shares be issued, subject
      to
      Sections 9 and 10, in the name of, and delivered to:

    

    ______________________________________

    ______________________________________

    ______________________________________

    ______________________________________

    

    The
      undersigned is hereby making payment for the Warrant Shares in the following
      manner: [check one]

    

    [  
      ] by
      cash
      in accordance with Section 3.1(b) of the Warrant

    

    [  
      ] via
      cashless exercise in accordance with Section 3.1(c) of the Warrant in the
      following manner:

    

    _____________________________________________________________________________________________________
_____________________________________________________________________________________________________
_____________________________________________________________________________________________________

     

    The
      undersigned hereby represents and warrants that it is, and has been since its
      acquisition of the Warrant, the record and beneficial owner of the
      Warrant.

    

    Dated:
      _______________ 

    

    ________________________________________

    Print
      or
      Type Name

    

    ________________________________________

    (Signature
      must conform in all respects to name of holder as specified on the face of
      Warrant)

    

    ________________________________________

    (Street
      Address)

    

    ________________________________________

    (City)
      (State) (Zip Code)

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      B

    FORM
      OF ASSIGNMENT

    [To
      be
      executed only upon transfer of Warrant]

    

    For
      value
      received, the undersigned registered holder of the within Warrant hereby sells,
      assigns and transfers unto _____________________ [include name and addresses]
      the rights represented by the Warrant to purchase __________ shares of Common
      Stock of EYETEL IMAGING, INC. to which the Warrant relates, and appoints
      _____________________ Attorney to make such transfer on the books of EYETEL
      IMAGING, INC. maintained for the purpose, with full power of substitution in
      the
      premises.

    
 

    
      	
              Dated:

            	________________________________________
              (Signature
                must conform in all respects 

              to
                name of holder as specified on the

              face
                of Warrant)

              

              ________________________________________

              (Street
                Address)

              

              ________________________________________

              (City)        
                (State)           
                (Zip Code)

            
	 	 
	
              Signed
                in the presence of:

            	
              
                ________________________________________

                (Signature
                  of Transferee)

                

                ________________________________________

                (Street
                  Address)

                

                ________________________________________

                
                  (City)        
                    (State)           
                    (Zip Code)

                

              

            
	 	 
	
              Signed
                in the presence of:

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