Document:

Exhibit 10.1

                       PREFERRED STOCK PURCHASE AGREEMENT

                                     BETWEEN

                          LOUNSBERRY HOLDINGS II, INC.

                                       AND

                               BARRON PARTNERS LP

                                      DATED

                                February 24, 2006

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                       PREFERRED STOCK PURCHASE AGREEMENT

          This PREFERRED STOCK PURCHASE AGREEMENT (the "Agreement") is made and
entered into as of the 24th day of February, 2006 between Lounsberry Holdings
II, Inc., a corporation organized and existing under the laws of the State of
Delaware (the "Company") and BARRON PARTNERS LP, a Delaware limited partnership
("Investor").

                             PRELIMINARY STATEMENT:

          WHEREAS, the Investor wishes to purchase from the Company, upon the
terms and subject to the conditions of this Agreement, seven million seven
hundred nineteen thousand two hundred fifty (7,719,250) shares of Series A
Convertible Preferred Stock, par value $.0001 per share ("Series A Preferred
Stock"), of the Company, with such preferred stock being as described in the
Certificate of Designations, Rights and Preferences (the "Certificate of
Designations") in substantially the form attached hereto as Exhibit A for the
Purchase Price set forth in Section 1.3.23 hereof. Subject to the limitations
set forth herein and in the Certificate of Designation, the Series A Preferred
Stock shall be initially convertible into shares of common stock of the Company
at any time at a conversion rate (the "Conversion Rate") of one (1) share of
Common Stock, par value $.0001 per share ("Common Stock"), for each share of
Series A Preferred Stock, subject to adjustment as provided in the Certificate
of Designation. In addition, the Company will issue to the Investor two Common
Stock Purchase Warrants (the "Warrants") to purchase up to five million six
hundred ten thousand shares (5,610,000) of Common Stock of the Company at fifty
six cents ($0.57) per share and five million six ten thousand (5,610,000) shares
of Common Stock of the Company at eighty five cents ($0.855) per share; and

         WHEREAS, as part of the transaction by which the Investor is purchasing
the Series A Preferred Stock and Warrants, the members of Ranor Acquisition LLC,
a Delaware limited liability company, the Company will issue an aggregate of
7,408,000 shares of Common Stock, in consideration for the assignment of the
agreement to acquire Ranor, Inc. and money advanced on behalf of the Company;
and

         WHEREAS, the parties intend to memorialize the purchase and sale of
such Series A Preferred Stock and the Warrants.

         NOW, THEREFORE, in consideration of the mutual covenants and premises
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which are hereby conclusively acknowledged, the parties hereto,
intending to be legally bound, agree as follows:

                                   ARTICLE I

             INCORPORATION BY REFERENCE, SUPERSEDER AND DEFINITIONS

1.1.     Incorporation by Reference. The foregoing recitals and the Exhibits and
         Schedules attached hereto and referred to herein, are hereby
         acknowledged to be true and accurate, and are incorporated herein by
         this reference.

1.2.     Superseder. This Agreement, to the extent that it is inconsistent with
         any other instrument or understanding among the parties governing the
         affairs of the Company, shall supersede such instrument or
         understanding to the fullest extent permitted by law. A copy of this
         Agreement shall be filed at the Company's principal office.

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1.3.     Certain Definitions. For purposes of this Agreement, the following
         capitalized terms shall have the following meanings (all capitalized
         terms used in this Agreement that are not defined in this Article 1
         shall have the meanings set forth elsewhere in this Agreement):

1.3.1.   "1933 Act" means the Securities Act of 1933, as amended.

1.3.2.   "1934 Act" means the Securities Exchange Act of 1934, as amended.

1.3.3.   "Affiliate" means a Person or Persons directly or indirectly, through
         one or more intermediaries, controlling, controlled by or under common
         control with the Person(s) in question. The term "control," as used in
         the immediately preceding sentence, means, with respect to a Person
         that is a corporation, the right to the exercise, directly or
         indirectly, of more than 50% of the voting rights attributable to the
         shares of such controlled corporation and, with respect to a Person
         that is not a corporation, the possession, directly or indirectly, of
         the power to direct or cause the direction of the management or
         policies of such controlled Person.

1.3.4.   "Articles" means the Certificate of Incorporation of the Company, as
         the same may be amended from time to time.

1.3.5.   "Closing" shall mean the Closing of the transactions contemplated by
         this Agreement on the Closing Date.

1.3.6.   "Closing Date" means the date on which the payment of the Purchase
         Price (as defined herein) by the Investor to the Company is completed
         pursuant to this Agreement to purchase the Series A Preferred Stock and
         Warrants, which shall occur on or before February 15, 2006.

1.3.7.   "Common Stock" means shares of common stock of the Company, par value
         $0.0001 per share.

1.3.8.   "EBITDA" shall mean earnings before interest, taxes, depreciation and
         amortization, determined in accordance with U.S. GAAP plus any
         deduction taken as a result of the issuance of the Restricted Shares.

1.3.9.   "Escrow Agreement" shall mean the Escrow Agreement among the Company,
         the Investor and Katsky Korins LLP, as Escrow Agent, attached hereto as
         Exhibit E, it being acknowledged that the Escrow Agent is counsel for
         the Company.

1.3.10.  "Exempt Issuance" means the issuance of (a) shares of Common Stock or
         options to employees, officers, directors of and consultants (other
         than consultants whose services relate to the raising of funds) the
         Company pursuant to the Company's 2006 Long-Term Incentive Plan or any
         other stock or option plan duly adopted by a majority of the
         non-employee members of the Board of Directors of the Company or a
         majority of the members of a committee of non-employee directors
         established for such purpose, (b) securities upon the exercise of or
         conversion of any securities issued hereunder and pursuant to the
         Registration Rights Agreement and any other options, warrants or
         convertible securities which are outstanding on the Closing Date after
         completion of the Closing, (c) the Restricted Shares, and (d)
         securities issued pursuant to acquisitions, licensing agreements, or
         other strategic transactions, provided any such issuance shall only be
         to a Person which is, itself or through its subsidiaries, an operating
         company in a business which the Company's board of directors believes
         is beneficial to the Company and in which the Company receives benefits
         in addition to the investment of funds, but shall not include a
         transaction in which the Company is issuing securities primarily for
         the purpose of raising capital or to an entity whose primary business
         is investing in securities.

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1.3.11.  "Material Adverse Effect" shall mean any adverse effect on the
         business, operations, properties or financial condition of the Company
         that is material and adverse to the Company and its subsidiaries and
         affiliates, taken as a whole and/or any condition, circumstance, or
         situation that would prohibit or otherwise materially interfere with
         the ability of the Company to perform any of its material obligations
         under this Agreement or the Registration Rights Agreement or to perform
         its obligations under any other material agreement.

1.3.12.  "Delaware Act" means the Delaware General Corporation Law, as amended.

1.3.13.  "Person" means an individual, partnership, firm, limited liability
         company, trust, joint venture, association, corporation, or any other
         legal entity.

1.3.14.  "Purchase Price" means the two million two hundred thousand dollars
         ($2,200,000) to be paid by the Investor to the Company for the Series A
         Preferred Stock and the Warrants.

1.3.15.  "Registration Rights Agreement" shall mean the registration rights
         agreement between the Investor and the Company attached hereto as
         Exhibit B.

1.3.16.  "Registration Statement" shall mean the registration statement under
         the 1933 Act to be filed with the Securities and Exchange Commission
         for the registration of the Shares pursuant to the Registration Rights
         Agreement attached hereto as Exhibit B.

1.3.17.  "Restricted Shares" shall mean 143,000 shares of Common Stock issued by
         the Company pursuant to restricted stock agreements with key employees.

1.3.18.  "Securities" means the shares of Series A Preferred Stock, the Warrants
         and the Shares.

1.3.19.  "SEC" means the Securities and Exchange Commission.

1.3.20.  "SEC Documents" shall mean the Company's latest Form10-SB, Form 10-K or
         Form 10-KSB as of the time in question, all Forms 10-Q or 10-QSB and
         8-K filed thereafter, and the Proxy Statement for its latest fiscal
         year as of the time in question until such time as the Company no
         longer has an obligation to maintain the effectiveness of a
         Registration Statement as set forth in the Registration Rights
         Agreement.

1.3.21.  "Shares" shall mean, collectively, the shares of Common Stock of the
         Company issued upon conversion of the Series A Preferred Stock
         subscribed for hereunder and those shares of Common Stock issuable to
         the Investor upon exercise of the Warrants.

1.3.22.  "Subsequent Financing" shall mean any offer and sale of shares of
         Series A Preferred Stock or debt that is initially convertible into
         shares of Common Stock or otherwise senior or superior to the Series A
         Preferred Stock.

1.3.23.  "Transaction Documents" shall mean this Agreement, all Schedules and
         Exhibits attached hereto and all other documents and instruments to be
         executed and delivered by the parties in order to consummate the
         transactions contemplated hereby, including, but not limited to the
         documents listed in Sections 3.2 and 3.3 hereof.

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1.3.24.  "Warrants" shall mean the Common Stock Purchase Warrants in the form
         attached hereto Exhibit D.

                                   ARTICLE II

        SALE AND PURCHASE OF PREFERRED STOCK AND WARRANTS; PURCHASE PRICE

2.1.     Sale of Series A Preferred Stock and Issuance of Warrants.

2.1.1.   Upon the terms and subject to the conditions set forth herein, and in
         accordance with applicable law, the Company agrees to sell to the
         Investor, and the Investor agrees to purchase from the Company, on the
         Closing Date seven million seven hundred nineteen thousand two hundred
         fifty (7,719,250) shares of Series A Preferred Stock and the Warrants
         for the (the "Purchase Price") of two million two hundred thousand
         dollars ($2,200,000). The Purchase Price shall be paid by the Investor
         to the Company on the Closing Date by a wire transfer or check of the
         Purchase Price into escrow to be held by the escrow agent pursuant to
         the terms of the Escrow Agreement. The Company shall cause the Series A
         Preferred Stock and the Warrants to be issued to the Investor upon the
         release of the Purchase Price to the Company by the escrow agent
         pursuant to the terms of the Escrow Agreement. The Company shall
         register the shares of Common Stock into which the Series A Preferred
         Stock is convertible pursuant to the terms and conditions of a
         Registration Rights Agreement attached hereto as Exhibit B.

2.1.2.   Each share of Preferred stock shall initially be convertible by the
         Investor into one (1) share of Common Stock; provided, however, that
         the Investor shall not be entitled to convert the Series A Preferred
         Stock into shares of Common Stock to the extent that such conversion
         would result in beneficial ownership by the Investor and its affiliates
         of more than 4.9% of the then outstanding number of shares of Common
         Stock on such date. For the purposes of the immediately preceding
         sentence, beneficial ownership shall be determined in accordance with
         Section 13(d) of the Securities Exchange Act of 1934, as amended, and
         Regulation 13d-3 thereunder. The limitation set forth in this Section
         2.1.2 is referred to as the "4.9% Limitation."

2.1.3.   Upon execution and delivery of this Agreement and the Company's receipt
         of the Purchase Price from the Escrow Agent pursuant to the terms of
         the Escrow Agreement, the Company shall issue to the Investor the
         Warrant to purchase an aggregate of 11,220,000 shares of Common Stock
         at exercise prices as stated in the Warrants, all pursuant to the terms
         and conditions of the form of Warrants attached hereto as Exhibit C;
         provided, however, that the Investor shall not be entitled to exercise
         the Warrants and receive shares of Common Stock that would result in
         beneficial ownership by the Investor and its affiliates of more than
         4.9% of the then outstanding number of shares of Common Stock on such
         date. For the purposes of this Agreement, beneficial ownership shall be
         determined in accordance with Section 13(d) of the Securities Exchange
         Act of 1934, as amended, and Regulation 13d-3 thereunder.

2.2.     Purchase Price. The Purchase Price shall be delivered by the Investor
         in the form of a wire transfer in United States dollars from the
         Investor to the escrow agent pursuant to the Escrow Agreement on the
         Closing Date.

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                                  ARTICLE III

                     CLOSING DATE AND DELIVERIES AT CLOSING

3.1.     Closing Date. The closing of the transactions contemplated by this
         Agreement (the "Closing"), unless expressly determined herein, shall be
         held at the offices of the Company, at 5:00 P.M. local time, on the
         Closing Date or on such other date and at such other place as may be
         mutually agreed by the parties, including closing by facsimile with
         originals to follow.

3.2.     Deliveries by the Company. In addition to and without limiting any
         other provision of this Agreement, the Company agrees to deliver, or
         cause to be delivered, to the escrow agent under the Escrow Agreement,
         the following:

                  (a) At or prior to Closing, an executed Agreement with all
         exhibits and schedules attached hereto;

                  (b) At or prior to Closing, executed Warrants in the name of
         the Investor in the form attached hereto as Exhibit C;

                  (c) The executed Registration Rights Agreement;

                  (d) Certifications in form and substance acceptable to the
         Company and the Investor from any and all brokers or agents involved in
         the transactions contemplated hereby as to the amount of commission or
         compensation payable to such broker or agent as a result of the
         consummation of the transactions contemplated hereby and from the
         Company or Investor, as appropriate, to the effect that reasonable
         reserves for any other commissions or compensation that may be claimed
         by any broker or agent have been set aside;

                  (e) Evidence of approval of the board of directors of the
         Company of the Transaction Documents and the transactions contemplated
         hereby;

                  (f) Evidence of the completion of the acquisition of Ranor,
         Inc., a Delaware corporation ("Ranor") contemporaneously with the
         Closing.

                  (g) Certificate of the President and the Secretary of the
         Company that the Certificate of Designation has been adopted and filed;

                  (h) Evidence that the Certificate of Amendment to the
         Certificate of Incorporation of the Company adopting the provision
         described in Section 6.19 has been approved by the Company's board of
         directors subject to stockholder approval.

                  (i) Good standing certificates of the Company issued by the
         Secretary of State of Delaware;

                  (j) An opinion from the Company's counsel concerning the
         Transaction Documents and the transactions contemplated hereby in form
         and substance reasonably acceptable to Investor;

                  (k) Stock Certificate in the name of Investor evidencing the
         Series A Preferred Stock;

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                  (l) The executed Escrow Agreement; and

                  (m) Copies of all executive employment agreements, all past
         and present financing documentation or other documentation where stock
         could potentially be issued or issued as payment, all past and present
         litigation documents and historical financials, not previously provided
         to Investor.

                  (n) Such other documents or certificates as shall be
         reasonably requested by Investor or its counsel.

3.3.     Deliveries by Investor. In addition to and without limiting any other
         provision of this Agreement, the Investor agrees to deliver, or cause
         to be delivered, to the escrow agent under the Escrow Agreement, the
         following:

                  (a) A deposit in the amount of the Purchase Price;

                  (b) The executed Agreement with all Exhibits and Schedules
         attached hereto;

                  (c) The executed Registration Rights Agreement;

                  (d) The executed Escrow Agreement; and

                  (e) Such other documents or certificates as shall be
         reasonably requested by the Company or its counsel.

In the event any document provided to the other party in Paragraphs 3.2 and 3.3
herein are provided by facsimile, the party shall forward an original document
to the other party within seven (7) business days.

3.4.     Further Assurances. The Company and the Investor shall, upon request,
         on or after the Closing Date, cooperate with each other (specifically,
         the Company shall cooperate with the Investor, and the Investor shall
         cooperate with the Company) by furnishing any additional information,
         executing and delivering any additional documents and/or other
         instruments and doing any and all such things as may be reasonably
         required by the parties or their counsel to consummate or otherwise
         implement the transactions contemplated by this Agreement.

3.5.     Waiver. The Investor may waive any of the requirements of Section 3.2
         of this Agreement or any of its rights under the Escrow Agreement, and
         the Company at its discretion may waive any of its rights of Section
         3.3 of this Agreement or any of its rights under the Escrow Agreement.

                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

         The Company represents and warrants to the Investor as of the date
hereof and as of Closing (which warranties and representations shall survive the
Closing regardless of what examinations, inspections, audits and other
investigations the Investor has heretofore made or may hereinafter make with
respect to such warranties and representations) as follows:

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4.1.     Organization and Qualification. Each of the Company and Ranor is a
         corporation duly organized, validly existing and in good standing under
         the laws of the state of its incorporation, and has the requisite
         corporate power and authority to own, lease and operate its properties
         and to carry on its business as it is now being conducted and is duly
         qualified to do business in any other jurisdiction by virtue of the
         nature of the businesses conducted by it or the ownership or leasing of
         its properties, except where the failure to be so qualified will not,
         when taken together with all other such failures, have a Material
         Adverse Effect on the business, operations, properties, assets,
         financial condition or results of operation of the Company and its
         subsidiaries taken as a whole.

4.2.     Articles of Incorporation and By-Laws. The complete and correct copies
         of the Company's Articles and By-Laws, as in effect on the Closing
         Date, has been delivered to the Investor.

4.3.     Capitalization.

4.3.1.   The authorized and outstanding capital stock of the Company as of the
         date of this Agreement and as adjusted to reflect issuances pursuant to
         or contemplated by this Agreement is set forth in Schedule 4.3.1 to
         this Agreement. Schedule 4.3.1 contains all shares and derivatives
         currently and potentially outstanding. The Company hereby represents
         that any and all shares and current potentially dilutive events have
         been included in Schedule 4.3.1, including employment agreements,
         acquisition, consulting agreements, debts, payments, financing or
         business relationships that could be paid in equity, derivatives or
         resulting in additional equity issuances.

4.3.2.   All outstanding shares of capital stock have been duly authorized and
         are validly issued, and are fully paid and non-assessable and free from
         preemptive rights. All shares of capital stock described above to be
         issued have been duly authorized and when issued, will be validly
         issued, fully paid and non-assessable and free from preemptive rights.

4.3.3.   Except pursuant to this Agreement and as set forth in Schedule 4.3.1
         hereto, and as set forth in the Company's SEC Documents, filed with the
         SEC, as of the date hereof and as of the Closing Date, there are not
         now outstanding options, warrants, rights to subscribe for, calls or
         commitments of any character whatsoever relating to, or securities or
         rights convertible into or exchangeable for, shares of any class of
         capital stock of the Company, or agreements, understandings or
         arrangements to which the Company is a party, or by which the Company
         is or may be bound, to issue additional shares of its capital stock or
         options, warrants, scrip or rights to subscribe for, calls or
         commitment of any character whatsoever relating to, or securities or
         rights convertible into or exchangeable for, any shares of any class of
         its capital stock. The Company agrees to inform the Investor in writing
         of any additional warrants granted prior to the Closing Date.

4.3.4.   The Company on the Closing Date (i) will have full right, power, and
         authority to sell, assign, transfer, and deliver, by reason of record
         and beneficial ownership, to the Investor, the Series A Preferred Stock
         hereunder, free and clear of all liens, charges, claims, options,
         pledges, restrictions, and encumbrances whatsoever; and (ii) upon
         conversion of the Series A Preferred Stock or exercise of the Warrants,
         the Investor will acquire title to such Shares, free and clear of all
         liens, charges, claims, options, pledges, restrictions, and
         encumbrances whatsoever, except as otherwise provided in this Agreement
         as to the limitation on the voting rights of such Shares in certain
         circumstances and except for any of the foregoing which results from
         actions or omissions on the part of the Investor.

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4.4.     Authority. The Company has all requisite corporate power and authority
         to execute and deliver this Agreement, the Series A Preferred Stock,
         and the Warrants, to perform its obligations hereunder and thereunder
         and to consummate the transactions contemplated hereby and thereby. The
         execution and delivery of this Agreement by the Company and the
         consummation of the transactions contemplated hereby have been duly
         authorized by all necessary corporate action and no other corporate
         proceedings on the part of the Company is necessary to authorize this
         Agreement or to consummate the transactions contemplated hereby except
         as disclosed in this Agreement. This Agreement has been duly executed
         and delivered by the Company and constitutes the legal, valid and
         binding obligation of the Company, enforceable against the Company in
         accordance with its terms; provided, however, that no representation is
         made with respect to the ability of the Investor to convert the Series
         A Preferred Stock or exercise any Warrant if and to the extent that the
         Conversion Price, as defined in the Certificate of Designation, of the
         Series A Preferred Stock or the number of Shares issuable upon exercise
         of the Warrants would result in the issuance of a number of shares of
         Common Stock which is greater than the amount by which the authorized
         Common Stock exceeds the sum of the outstanding Common Stock and the
         shares of Common Stock reserved for issuance pursuant to outstanding
         agreements and outstanding options, warrants, rights, convertible
         securities and other securities upon the exercise or conversion of
         which or pursuant to the terms of which additional shares of Common
         Stock may be issuable (the foregoing proviso being referred to as the
         "Authorized Stock Proviso").

4.5.     No Conflict; Required Filings and Consents. The execution and delivery
         of this Agreement by the Company does not, and the performance by the
         Company of its obligations hereunder will not: (i) conflict with or
         violate the Articles or By-Laws of the Company; (ii) conflict with,
         breach or violate any federal, state, foreign or local law, statute,
         ordinance, rule, regulation, order, judgment or decree (collectively,
         "Laws") in effect as of the date of this Agreement and applicable to
         the Company; or ---- (iii) result in any breach of, constitute a
         default (or an event that with notice or lapse of time or both would
         become a default) under, give to any other entity any right of
         termination, amendment, acceleration or cancellation of, require
         payment under, or result in the creation of a lien or encumbrance on
         any of the properties or assets of the Company pursuant to, any note,
         bond, mortgage, indenture, contract, agreement, lease, license, permit,
         franchise or other instrument or obligation to which the Company is a
         party or by the Company or any of its properties or assets is bound.
         Excluding from the foregoing are such violations, conflicts, breaches,
         defaults, terminations, accelerations, creations of liens, or
         incumbency that would not, in the aggregate, have a Material Adverse
         Effect except to the extent that stockholder approval may be required
         as a result of the Authorized Stock Proviso, in which event, the
         Company will seek stockholder approval to an increase in the authorized
         Common Stock sufficient to enable the Company to be in compliance with
         this Section 4.5.

4.6.     Report and Financial Statements. Schedule 4.6 sets forth the audited
         balance sheet of Ranor as of March 31, 2005 and the audited statements
         of operations, stockholders equity and cash flows for the years ended
         March 31, 2005 and 2004, and the unaudited balance sheet as of
         September 30, 2005 and unaudited statements of operations and cash
         flows for the six months ended September 30, 2005 and 2004 and
         stockholders' equity for the six months ended September 30, 2005, in
         each cash including notes to the financial statements (collectively,
         the "Financial Statements"). Each of the balance sheets contained in or
         incorporated by reference into any such Financial Statements (including
         the related notes and schedules thereto) fairly presented the financial
         position of Ranor, as of its date, and each of the statements of
         operations, stockholders' equity and cash flows in such Financial
         Statements (including any related notes

                                      -8-
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         and schedules thereto) fairly presents, changes in stockholders' equity
         and changes in cash flows, as the case may be, of Ranor, for the
         periods to which they relate, in each case in accordance with United
         States generally accepted accounting principles ("U.S. GAAP")
         consistently applied during the periods involved, except in each case
         as may be noted therein, subject to normal year-end audit adjustments
         in the case of unaudited statements. The books and records of the
         Company have been, and are being, maintained in all material respects
         in accordance with U.S. GAAP and any other applicable legal and
         accounting requirements and reflect only actual transaction.

4.7.     Compliance with Applicable Laws. The Company is not in violation of,
         or, to the knowledge of the Company is under investigation with respect
         to or has been given notice or has been charged with the violation of
         any Law of a governmental agency, except for violations which
         individually or in the aggregate do not have a Material Adverse Effect.

4.8.     Brokers. Except as set forth on Schedule 4.8, no broker, finder or
         investment banker is entitled to any brokerage, finder's or other fee
         or Commission in connection with the transactions contemplated by this
         Agreement based upon arrangements made by or on behalf of the Company.

4.9.     SEC Documents. The Investor acknowledges that the Company is a publicly
         held company and has made available to the Investor true and complete
         copies of any requested SEC Documents. The Company has registered its
         Common Stock pursuant to Section 12(g) of the 1934 Act. The Company has
         not provided to the Investor any information that, according to
         applicable law, rule or regulation, should have been disclosed publicly
         prior to the date hereof by the Company, but which has not been so
         disclosed.

4.10.    Litigation. To the knowledge of the Company, no litigation, claim, or
         other proceeding before any court or governmental agency is pending or
         to the knowledge of the Company, threatened against the Company or
         Ranor, the prosecution or outcome of which, if adversely determined, is
         likely to have a Material Adverse Effect.

4.11.    Exemption from Registration. Subject to the accuracy of the Investor's
         representations in Article V, except as required pursuant to the
         Registration Rights Agreement, the sale of the Series A Preferred Stock
         and Warrants by the Company to the Investor will not require
         registration under the 1933 Act, but may require registration or an
         exemption from registration under New York state securities law if
         applicable to the Investor. When validly converted in accordance with
         the terms of the Series A Preferred Stock, and upon exercise of the
         Warrants in accordance with their terms, the Shares underlying the
         Series A Preferred Stock and the Warrants will be duly and validly
         issued, fully paid, and non-assessable. The Company is issuing the
         Series A Preferred Stock and the Warrants in accordance with and in
         reliance upon the exemption from securities registration afforded,
         inter alia, by Rule 506 under Regulation D as promulgated by the SEC
         under the 1933 Act, and/or Section 4(2) of the 1933 Act; provided,
         however, that certain filings and registrations may be required under
         state securities "blue sky" laws depending upon the residency of the
         Investor.

4.12.    No General Solicitation or Advertising in Regard to this Transaction.
         Neither the Company nor any of its Affiliates nor, to the knowledge of
         the Company, any Person acting on its or their behalf (i) has conducted
         or will conduct any general solicitation (as that term is used in Rule
         502(c) of Regulation D as promulgated by the SEC under the 1933 Act) or
         general advertising with respect to the sale of the Series A Preferred
         Stock or Warrants, or (ii) made any offers or sales of any security or
         solicited any offers to buy any security under any circumstances that
         would require registration of the Series A Preferred Stock or Warrants,
         under the 1933 Act, except as required herein.

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4.13.    No Material Adverse Effect. Except as set forth in Schedule 4.13
         attached hereto, since September 30, 2005, no event or circumstance
         resulting in a Material Adverse Effect has occurred or exists with
         respect to Ranor. To the knowledge of the Company, no material supplier
         or customer has given notice, oral or written, that it intends to cease
         or reduce the volume of its business with Ranor from historical levels.

4.14.    Material Non-Public Information. The Company has not disclosed to the
         Investor any material non-public information that (i) if disclosed,
         would reasonably be expected to have a material effect on the price of
         the Common Stock or (ii) according to applicable law, rule or
         regulation, should have been disclosed publicly by the Company prior to
         the date hereof but which has not been so disclosed; provided, however,
         that the Company has disclosed to the Investor matters relating to the
         Company's acquisition of Ranor and the financing of such acquisition.

4.15.    Internal Controls And Procedures. To the knowledge of the Company,
         Ranor maintains books and records and internal accounting controls
         which provide reasonable assurance that (i) all transactions to which
         Ranor or any subsidiary is a party or by which its properties are bound
         are executed with management's authorization; (ii) the recorded
         accounting of Ranor's consolidated assets is compared with existing
         assets at regular intervals; (iii) access to Ranor's consolidated
         assets is permitted only in accordance with management's authorization;
         and (iv) all transactions to which Ranor or any subsidiary is a party
         or by which its properties are bound are recorded as necessary to
         permit preparation of the financial statements of the Company in
         accordance with standards of the Public Company Accounting Oversight
         Board; it being understood that Ranor has not conducted an internal
         controls audit and that no such audit has been required under
         applicable law.

4.16.    Full Disclosure. No representation or warranty made by the Company in
         this Agreement and no certificate or document furnished or to be
         furnished to the Investor pursuant to this Agreement contains or will
         contain any untrue statement of a material fact, or omits or will omit
         to state a material fact necessary to make the statements contained
         herein or therein not misleading.

4.17.    Independent Board. At the Closing, the board of directors of the
         Company shall consist of five directors, three of whom shall be
         independent, as defined under the regulation of the Nasdaq Stock
         Market, and a majority of the members of the audit and compensation
         committees of the board of directors of the Company will be comprised
         of independent directors.

                                   ARTICLE V

                 REPRESENTATIONS AND WARRANTIES OF THE INVESTORS

The Investor represents and warrants to the Company that:

5.1.     Organization and Standing of the Investor. The Investor is a limited
         partnership duly formed, validly existing and in good standing under
         the laws of the State of Delaware. The state in which any offer to
         purchase shares hereunder was made or accepted by such Investor is the
         state shown as such Investor's address. The Investor was not formed for
         the purpose of investing solely in the Series A Preferred Stock, the
         Warrants or the shares of Common Stock which are the subject of this
         Agreement.

                                      -10-
<PAGE>

5.2.     Authorization and Power. The Investor has the requisite power and
         authority to enter into and perform this Agreement and to purchase the
         securities being sold to it hereunder. The execution, delivery and
         performance of this Agreement by the Investor and the consummation by
         the Investor of the transactions contemplated hereby have been duly
         authorized by all necessary partnership action where appropriate. This
         Agreement and the Registration Rights Agreement have been duly executed
         and delivered by the Investor and at the Closing shall constitute valid
         and binding obligations of the Investor enforceable against the
         Investor in accordance with their terms, except as such enforceability
         may be limited by applicable bankruptcy, insolvency, reorganization,
         moratorium, liquidation, conservatorship, receivership or similar laws
         relating to, or affecting generally the enforcement of, creditors'
         rights and remedies or by other equitable principles of general
         application.

5.3.     No Conflicts. The execution, delivery and performance of this Agreement
         and the consummation by the Investor of the transactions contemplated
         hereby or relating hereto do not and will not (i) result in a violation
         of such Investor's charter documents or bylaws where appropriate or
         (ii) conflict with, or constitute a default (or an event which with
         notice or lapse of time or both would become a default) under, or give
         to others any rights of termination, amendment, acceleration or
         cancellation of any agreement, indenture or instrument to which the
         Investor is a party, or result in a violation of any law, rule, or
         regulation, or any order, judgment or decree of any court or
         governmental agency applicable to the Investor or its properties
         (except for such conflicts, defaults and violations as would not,
         individually or in the aggregate, have a Material Adverse Effect on
         such Investor). The Investor is not required to obtain any consent,
         authorization or order of, or make any filing or registration with, any
         court or governmental agency in order for it to execute, deliver or
         perform any of such Investor's obligations under this Agreement or to
         purchase the securities from the Company in accordance with the terms
         hereof, provided that for purposes of the representation made in this
         sentence, the Investor is assuming and relying upon the accuracy of the
         relevant representations and agreements of the Company herein.

5.4.     Financial Risks. The Investor acknowledges that such Investor is able
         to bear the financial risks associated with an investment in the
         securities being purchased by the Investor from the Company and that it
         has been given full access to such records of the Company and the
         subsidiaries and to the officers of the Company and the subsidiaries as
         it has deemed necessary or appropriate to conduct its due diligence
         investigation. The Investor is capable of evaluating the risks and
         merits of an investment in the securities being purchased by the
         Investor from the Company by virtue of its experience as an investor
         and its knowledge, experience, and sophistication in financial and
         business matters and the Investor is capable of bearing the entire loss
         of its investment in the securities being purchased by the Investor
         from the Company.

5.5.     Accredited Investor. The Investor is (i) an "accredited investor" as
         that term is defined in Rule 501 of Regulation D promulgated under the
         1933 Act by reason of Rule 501(a)(3) and (6), (ii) experienced in
         making investments of the kind described in this Agreement and the
         related documents, (iii) able, by reason of the business and financial
         experience of its officers (if an entity) and professional advisors
         (who are not affiliated with or compensated in any way by the Company
         or any of its affiliates or selling agents), to protect its own
         interests in connection with the transactions described in this
         Agreement, and the related documents, and (iv) able to afford the
         entire loss of its investment in the securities being purchased by the
         Investor from the Company. The Investor is acquiring the Securities for
         investment and not with a view to the sale or distribution thereof and
         understands that such Securities are restricted securities, as defined
         in the 1933 Act, and may not be sold or otherwise distributed except
         pursuant to an effective registration statement or an exemption from
         the registration requirements of the 1933 Act and that the certificates
         for such securities shares and Warrants will bear an investment legend.

                                      -11-
<PAGE>

5.6.     Brokers. Except as set forth in Schedule 4.8, no broker, finder or
         investment banker is entitled to any brokerage, finder's or other fee
         or Commission in connection with the transactions contemplated by this
         Agreement based upon arrangements made by or on behalf of the Investor.

5.7.     Knowledge of Company. The Investor and such Investor's advisors, if
         any, have been, upon request, furnished with all materials relating to
         the business, finances and operations of the Company and materials
         relating to the offer and sale of the securities being purchased by the
         Investor from the Company. The Investor and such Investor's advisors,
         if any, have been afforded the opportunity to ask questions of the
         Company and have received complete and satisfactory answers to any such
         inquiries.

5.8.     Risk Factors. The Investor understands that such Investor's investment
         in the securities being purchased by the Investor from the Company
         involves a high degree of risk. The Investor understands that no United
         States federal or state agency or any other government or governmental
         agency has passed on or made any recommendation or endorsement of the
         securities being purchased by the Investor from the Company. The
         Investor warrants that such Investor is able to bear the complete loss
         of such Investor's investment in the securities being purchased by the
         Investor from the Company. In acquiring the Securities, the Investor is
         not relying upon any projections of the future financial condition,
         results of operations or cash flows relating to the Company.

5.9.     Full Disclosure. No representation or warranty made by the Investor in
         this Agreement and no certificate or document furnished or to be
         furnished to the Company pursuant to this Agreement contains or will
         contain any untrue statement of a material fact, or omits or will omit
         to state a material fact necessary to make the statements contained
         herein or therein not misleading. Except as set forth or referred to in
         this Agreement, (a) the Investor does not have any agreement or
         understanding with any person relating to acquiring, holding, voting or
         disposing of any equity securities of the Company. and (b) during the
         past five years there has not occurred any event listed in Item 401(f)
         of Regulation S-K or any investigation relating to any such event with
         respect to the Investor nor any of its managing partners.

                                   ARTICLE VI

                            COVENANTS OF THE COMPANY

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

                                      -12-
<PAGE>

6.2.     Reservation of Common Stock. As of the date hereof, the Company has
         reserved and the Company shall continue to reserve and keep available
         at all times, free of preemptive rights, shares of Common Stock for the
         purpose of enabling the Company to issue the Shares underlying the
         Series A Preferred Stock and Warrants; provided, however, that if, as a
         result of the Authorized Stock Proviso, there are not sufficient shares
         reserved as required in this Section 6.2, the Company shall, within
         thirty (30) days after the Company becomes aware of such deficiency,
         prepare and file with the Commission a proxy statement pursuant to
         which the Company will seek stockholder approval for an increase in the
         authorized Common Stock sufficient to enable the Company to be in
         compliance with this Section 6.2. The Investor agrees to vote in favor
         of such proposal.

6.3.     Compliance with Laws. The Company hereby agrees to comply in all
         material respects with the Company's reporting, filing and other
         obligations under the Laws.

6.4.     Exchange Act Registration. The Company will use its best efforts to
         comply in all respects with its reporting and filing obligations under
         the 1934 Act, and will not take any action or file any document
         (whether or not permitted by the 1934 Act or the rules thereunder) to
         terminate or suspend any such registration or to terminate or suspend
         its reporting and filing obligations under the 1934 until the Investors
         have disposed of all of their Shares.

6.5.     Corporate Existence; Conflicting Agreements. The Company will take all
         steps necessary to preserve and continue the corporate existence of the
         Company. The Company shall not enter into any agreement, the terms of
         which agreement would restrict or impair the right or ability of the
         Company to perform any of its obligations under this Agreement or any
         of the other agreements attached as exhibits hereto.

6.6.     Preferred Stock. Until the earlier of (a) three years from the Closing
         or (b) such date as the Investor shall have converted not less than 90%
         of the shares of Series A Preferred Stock and sold the underlying
         Shares or (c) such date as the Investor shall have transferred not less
         than 90% of the shares of Series A Preferred Stock or (d) such date as
         the total number of shares of Preferred Stock which the Investor shall
         have either transferred or converted and sold the underlying Shares
         shall represent not less than 90% of the shares of Series A Preferred
         Stock issued to the Investor, the Company will not issue any preferred
         stock of the Company with the exception of Series A Preferred Stock
         issued to the Investor.

6.7.     Convertible Debt. On or prior to the Closing Date, the Company will
         cause to be cancelled all convertible debt in the Company. Until the
         earlier of (a) three years from the Closing or (b) such date as the
         Investor shall have converted not less than 90% of the shares of Series
         A Preferred Stock and sold the underlying Shares or (c) such date as
         the Investor shall have transferred not less than 90% of the shares of
         Series A Preferred Stock or (d) such date as the total number of shares
         of Preferred Stock which the Investor shall have either transferred or
         converted and sold the underlying Shares shall represent not less than
         90% of the shares of Series A Preferred Stock issued to the Investor,
         the Company will not issue any convertible debt.

6.8.     Debt Limitation. The Company agrees for two years after Closing not to
         enter into any new borrowings of more than three times the sum of the
         EBITDA from recurring operations over the trailing four quarters.

                                      -13-
<PAGE>

6.9.     Reset Equity Deals. On or prior to the Closing Date, the Company will
         cause to be cancelled any and all reset features related to any shares
         outstanding that could result in additional shares being issued. For a
         period of three years from the closing the Company will not enter into
         any transactions that have any reset features that could result in
         additional shares being issued. For purposes of this Section 6.9, a
         reset provision for a convertible security or derivative security shall
         mean a provision whereby the issuance of securities at a lower price or
         having a lower conversion or exercise price will result in the
         conversion or exercise price of the security being reduced to the lower
         price or lower conversion or exercise price or more shares being
         issued, as the case may be or which have a conversion or exercise price
         that is based on the market price at the time of conversion or exercise
         or any other device which results in an adjustment to the exercise
         price or conversion price of the above mentioned securities in section
         6.9 other than stock dividends, stock splits, stock distributions,
         combination of shares, reverse splits, and other recapitalizations, as
         long as they effect all stockholders appropriately.

6.10.    Independent Directors.

6.10.1.  The Company shall have caused the appointment of the majority of the
         board of directors to be independent directors, as defined by the rules
         of the Nasdaq Stock Market, before Closing.

6.10.2.  If, at any time from the Closing and until the earlier of (a) three
         years from the Closing or (b) such date as the Investor shall have
         converted not less than 90% of the shares of Series A Preferred Stock
         and sold the underlying Shares or (c) such date as the Investor shall
         have transferred not less than 90% of the shares of Series A Preferred
         Stock, the board of directors shall not be composed of a majority of
         independent directors:

6.10.2.1. for a reason other than for an excused reason, the Company shall have
          75 days, to take such steps as are necessary so that a majority of the
          Company's directors are independent directors, and

6.10.2.2. for an excused reason, the Company shall have 75 days from the date
          that the Company becomes aware of the event (or the last event if
          there are more than one such event) giving rise to the excused reason,
          to take such steps as are necessary so that a majority of the
          Company's directors are independent directors.

6.10.3.  For purposes of this Section 6.10, an excused reason shall mean the
         death or resignation of an independent director or the occurrence of an
         event whereby an independent director ceases to be independent.

6.10.4.  If, during the period referred to in Section 6.10.2 of this Agreement,
         the Company shall have failed to have a board of directors composed of
         a majority of independent directors after the date by which such
         situation was to have been cured pursuant to Section 6.10.2.1 or
         Section 6.10.2.2 of this Agreement, whichever shall apply, the Company
         shall pay to the Investor, as liquidated damages and not as a penalty,
         an amount equal to twelve percent (12%) per annum of the Purchase Price
         of the then outstanding Series A Preferred Stock, payable monthly in
         cash or Series A Preferred Stock at the option of the Investor, based
         on the number of days that such condition exists. The parties agree
         that the only damages payable for a violation of such provisions shall
         be such liquidated damages. Nothing shall preclude the Investor from
         pursuing or obtaining specific performance or other equitable relief
         with respect to this Agreement. The parties hereto agree that the
         liquidated damages provided for in this Section 6.10.4 constitute a
         reasonable estimate of the damages that may be incurred by the Investor
         by reason of the failure of the Company to have a majority of directors
         as independent directors.

                                      -14-
<PAGE>

6.10.5.  In no event shall the total payments made pursuant to this Section 6.10
         and Section 6.11, whether in cash or Series A Preferred Stock exceed in
         the aggregate eighteen percent (18%) of the Purchase Price of the then
         outstanding Series A Preferred Stock.

6.11.    Independent Directors Become Majority of Audit and Compensation
         Committees. The Company will cause the appointment of a majority of
         independent directors to the audit and compensation committees of the
         board of directors before or at Closing. If at any time after Closing
         independent directors do not compose the majority of the audit and
         compensation committees, the Company shall pay to the Investors, pro
         rata, as liquidated damages and not as a penalty, an amount equal to
         twelve percent (12%) of the Purchase Price per annum, payable monthly
         in cash or Series A Preferred Stock at the option of the Investor, such
         payment shall be based on the number of days that such condition
         exists. The parties agree that the only damages payable for a violation
         of the terms of this Agreement with respect to which liquidated damages
         are expressly provided shall be such liquidated damages. Nothing shall
         preclude the Investor from pursuing other remedies or obtaining
         specific performance or other equitable relief with respect to this
         Agreement. Notwithstanding the foregoing, no liquidated damages shall
         be payable pursuant to this Section 6.11 during any period for which
         liquidated damages are payable pursuant to Section 6.10.

6.12.    Use of Proceeds. The Company will use the proceeds from the sale of the
         Series A Preferred Stock and the Warrants (excluding amounts paid by
         the Company for legal and administrative fees in connection with the
         sale of such securities) for the acquisition of Ranor and working
         capital.

6.13.    Right of First Refusal

6.13.1.  In the event that the Company seeks to raise additional funds through a
         private placement of its securities (a "Proposed Financing"), other
         than Exempt Issuances, the Investor shall have the right to participate
         in any subsequent funding by the Company of the offering price on a pro
         rata basis, based on the percentage that (a) the number of Shares held
         by the Investor plus the number of Shares issuable upon conversion of
         the Series A Preferred Stock then owned by the Investor, without regard
         to the 4.9% Limitation, bears to (b) the total number of shares of
         Common Stock outstanding plus the number of Shares issuable upon
         conversion of the Series A Preferred Stock and any other series of
         convertible preferred stock or debt securities, without regard to the
         4.9% Limitations any other limitations on exercise such other
         convertible preferred stock or debt securities.

6.13.2.  The terms on which the Investor shall purchase securities pursuant to
         Proposed Financing shall be the same as such securities are purchased
         by other investors. The Company shall give the Investor not less than
         ten (10) days notice setting forth the terms of the Proposed Financing.
         In the event that the terms of the Proposed Financing are changed, the
         Company shall provide the Investor with the same notice of the revised
         terms that are provided to the other investors.

6.13.3.  In the event that the Investor does not exercise its right to
         participate in the Proposed Financing, the Company may sell the
         securities in the Proposed Financing at a price and on terms which are
         no more favorable to the investors than the terms provided to the
         Investor. If the Company subsequently changes the price or terms so
         that the terms are at a price or more favorable to the investors, the
         Company shall reoffer the securities to the Investor as provided in
         Section 6.12.2 of this Agreement.

                                      -15-
<PAGE>

6.14.    Price Adjustment. The Certificate of Designation shall include the
         following provision: If, within the 36 months following the Closing
         Date, the Company closes on the sale of a note or notes, shares of
         Common Stock, or shares of any class of Preferred Stock at a price per
         share of Common Stock, or with a conversion right to acquire Common
         Stock at a price per share of Common Stock (other than (x) an Exempt
         Issuance or (y) an issuance covered by the [Section of the Certificate
         of Designation relating to stock dividends, distributions and reverse
         splits] and [Section of the Certificate of Designation relating to pro
         rata distributions] or (z) an issuance of Common Stock upon exercise or
         upon conversion of warrants, options or other convertible securities
         for which an adjustment has already been made pursuant to this Section
         [Section no. of Certificate of Designation]), that is less than the
         Conversion Price in effect at the time of such sale (such lower price
         being referred to as the "Lower Price"), the conversion rate shall be
         adjusted as follows. The "Conversion Price" shall mean the price paid
         for one share of Series A Preferred Stock divided by the number of
         shares of Common Stock issuable upon conversion of one share of Series
         A Preferred Stock. The "Conversion Rate" is the number of shares of
         Common Stock issuable upon conversion of one (1) share of Series A
         Preferred Stock. The initial Conversion Rate is one share of Common
         Stock per share of Series A Preferred Stock and the initial Conversion
         Price is $.285. The Conversion Rate shall be adjusted by multiplying
         the Conversion Rate in effect immediately prior to such issuance by a
         fraction, the numerator of which shall be the number of shares of
         Common Stock outstanding immediately after the issuance of such
         additional shares (including the exercise or conversion of all options,
         warrants and other convertible securities issued in connection
         therewith) and the denominator of which shall be the sum of the number
         of shares of Common Stock outstanding immediately prior to the issuance
         of such additional shares and the number of shares of Common Stock
         which the aggregate consideration received or receivable for the
         issuance of such additional shares at the Lower Price would purchase at
         the Conversion Price then in effect. Such adjustment shall be made
         successively whenever such an issuance is made.

6.15.    Price Adjustment Based on EBITDA Per Share.

6.15.1.  In the event the Company's EBITDA per share of Common Stock is between
         $0.06591 and $0.04613 per share (where such EBITDA per share is defined
         as EBITDA as reported for the audited fiscal year ended March 31, 2006
         from recurring operations before any charges relating to the
         transaction contemplated by this Agreement and any other non recurring
         items, including warrants, but excluding options or stock grants issued
         to management and key employees), the conversion price shall be reduced
         proportionately by 0% if the EBITDA is $0.06591 per share and by 15% if
         EBITDA is $0.04613 per share or lower. Fully-diluted EBITDA Per Share
         shall be based on the number of outstanding shares of Common Stock plus
         all shares of Common Stock issuable upon conversion of all outstanding
         convertible securities and upon exercise of all outstanding warrants,
         options and rights, regardless of whether (i) such shares would be
         included in determining diluted earnings per share and (ii) such
         convertible securities are subject to a restriction or limitation on
         exercise. Thus, for purpose of determining fully-diluted Pre-Tax Income
         Per Share, the 4.9% Limitation shall be disregarded. For example, if
         the Company's EBITDA is $0.052728 per share, or 20% below $0.06591 per
         share, then the Conversion Price shall be reduced by 10%. Such
         reduction shall be made at the time the Company files its Form 10-K or
         Form 10-KSB for the year ended March 31, 2006. In the event that EBITDA
         per share is less than $0.04613, or the Company has a loss, the
         Conversion Price shall be reduced by a maximum of 15%. This Section
         6.15.1 shall apply to the all of the Series A Preferred Stock which is
         outstanding on the date the Form 10-KSB or 10-K is filed, or, if not
         filed on time, on the date that filing was required.

                                      -16-
<PAGE>

6.15.2.  In the event the Company's EBITDA per share of Common Stock, determined
         as provided in Section 6.15.1 of this Agreement, for the fiscal year
         ended March 31, 2007 is between $0.08568 and $0.05997, the Conversion
         Price then in effect shall be reduced proportionately by 0% if EBITDA
         is $0.08568 or greater and 15% if EBITDA is $0.05997 or less, with a
         proportionate reduction if EBITDA is between $0.08568 and $0.05997.
         Such reduction shall be made at the time the Company files its Form
         10-K or Form 10-KSB for the year ended March 31, 2007. In the event
         that EBITDA per share is less than $0.05997, or the Company has a loss,
         the Conversion Price shall be reduced by a maximum of 15%. In
         determining the EBITDA per share of Common Stock pursuant to this
         Section 6.15.2, there shall be excluded any shares of Common Stock
         issuable as a result of an adjustment to the Conversion Price pursuant
         to Section 6.15.1

6.16.    Insider Selling. The earliest any "Insiders" can start selling their
         shares in the public market shall be twelve months from Closing. After
         twelve months following the Closing (the "Lock-up Period"), no Insider
         shall sell more than 10% of his or her shares in the Company in the
         public market in the twelve-month period following the expiration of
         the Lock-up Period or more than an additional 10% of his or her shares
         (based on shares owned on the Closing Date) during the following
         twelve-month period, and such shares may be sold pursuant to either
         Rule 144 or any registration statement which may cover such shares.
         Insiders shall include all persons who are officers and directors of
         the Company at the Closing or who become officers and directors during
         the fiscal year ended March 31, 2006. Andrew Barron Worden and the
         Investor shall not be considered "Insiders." The restrictions in this
         Section 6.16 shall not apply to shares issued pursuant to a stock
         option or long-term incentive plans which may be approved by the
         Compensation Committee provided that such committee is comprises of a
         majority of independent directors. The Company may include in the
         registration statement filed pursuant to the Registration Rights
         Agreement all of the shares of Common Stock which are outstanding
         immediately prior to the Closing, none of which shall be owned by
         Affiliates of the Company.

6.17.    Employment and Consulting Contracts. For three years after the Closing
         Company must have a unanimous opinion from the Compensation Committee
         of the Board of Directors that any awards other than salary are usual,
         appropriate and reasonable for any officer, director or consultants
         whose compensation is more than $100,000 per annum holding a similar
         position in other public companies with independent majority boards
         with similar market capitalizations in the same industry with
         securities listed on the OTCBB, ASE, NYSE or Nasdaq.

6.18.    Subsequent Equity Sales. From the date hereof until such time as the
         Investor holds no more than 5% of the Shares (determined as if the
         Series A Preferred Stock were fully converted and the Warrants fully
         exercised), the Company shall be prohibited from effecting or entering
         into an agreement to effect any Subsequent Financing involving a
         "Variable Rate Transaction" or an "MFN Transaction" (each as defined
         below). The term "Variable Rate Transaction" shall mean a transaction
         in which the Company issues or sells (i) any debt or equity securities
         that are convertible into, exchangeable or exercisable for, or include
         the right to receive additional shares of Common Stock either (A) at a
         conversion, exercise or exchange rate or other price that is based upon
         and/or varies with the trading prices of or quotations for the shares
         of Common Stock at any time after the initial issuance of such debt or
         equity securities, or (B) with a conversion, exercise or exchange price
         that is subject to being reset at some future date after the initial
         issuance of such debt or equity security or upon the occurrence of
         specified or contingent events directly or indirectly related to the
         business of the Company or the market for the Common Stock. The term
         "MFN Transaction" shall mean a transaction in which the Company issues
         or sells any securities in a capital raising transaction or series of
         related transactions which grants to an investor the right to receive
         additional shares based upon future transactions of the Company on
         terms which are more favorable to such investor than the terms granted
         to the Investor in this Agreement. Any Purchaser shall be entitled to
         obtain injunctive relief against the Company to preclude any such
         issuance, which remedy shall be in addition to any right to collect
         damages. Notwithstanding the foregoing, this Section 6.17 shall not
         apply in respect of an Exempt Issuance, except that no Variable Rate
         Transaction or MFN Transaction shall be an Exempt Issuance.

                                      -17-
<PAGE>

6.19.    Amendment to Certificate of Incorporation. At or before the next annual
         meeting of the stockholders of the Company, the Board of Directors
         shall propose and submit to the holders of the Common Stock for
         approval, an amendment to the Certificate of Incorporation that
         provides substantially as follows:

            "The terms and conditions of any rights, options and warrants
         approved by the Board of Directors may provide that any or all of such
         terms and conditions may be waived or amended only with the consent of
         the holders of a designated percentage of a designated class or classes
         of capital stock of the Corporation (or a designated group or groups of
         holders within such class or classes, including but not limited to
         disinterested holders), and the applicable terms and conditions of any
         such rights, options or warrants so conditioned may not be waived or
         amended absent such consent."

6.20.    Stock Splits. All forward and reverse stock splits shall effect all
         equity and derivative holders proportionately.

6.21.    Payment of Due Diligence Expenses. At Closing the Escrow Agent shall
         disperse to the Investor Fifty Thousand Dollars ($50,000.00) for due
         diligence, legal and any other expenses which the Investor may incur in
         connection with this Agreement.

                                  ARTICLE VII

                            COVENANTS OF THE INVESTOR

7.1.     Compliance with Law. The Investor's trading activities with respect to
         shares of the Company's Common Stock will be in compliance with all
         applicable state and federal securities laws, rules and regulations and
         rules and regulations of any public market on which the Company's
         Common Stock is listed.

7.2.     Transfer Restrictions. The Investor's acknowledge that (1) the Series A
         Preferred Stock, Warrants and shares underlying the Series A Preferred
         Stock and Warrants have not been registered under the provisions of the
         1933 Act, and may not be transferred unless (A) subsequently registered
         thereunder or (B) the Investor shall have delivered to the Company an
         opinion of counsel, reasonably satisfactory in form, scope and
         substance to the Company, to the effect that the Series A Preferred
         Stock, Warrants and shares of Common Stock underlying the Series A
         Preferred Stock and Warrants to be sold or transferred may be sold or
         transferred pursuant to an exemption from such registration; and (2)
         any sale of the Series A Preferred Stock, Warrants and shares
         underlying the Series A Preferred Stock and Warrants made in reliance
         on Rule 144 promulgated under the 1933 Act may be made only in
         accordance with the terms of said Rule and further, if said Rule is not
         applicable, any resale of such securities under circumstances in which
         the seller, or the person through whom the sale is made, may be deemed
         to be an underwriter, as that term is used in the 1933 Act, may require
         compliance with some other exemption under the 1933 Act or the rules
         and regulations of the SEC thereunder.

7.3.     Restrictive Legend. The Investor acknowledges and agrees that the
         Series A Preferred Stock, the Warrants and the Shares underlying the
         Series A Preferred Stock and Warrants, and, until such time as the
         Shares underlying the Series A Preferred Stock and Warrants have been
         registered under the 1933 Act and sold in accordance with an effective
         Registration Statement, certificates and other instruments representing
         any of the Shares, shall bear a restrictive legend in substantially the
         following form (and a stop-transfer order may be placed against
         transfer of any such securities):

                                      -18-
<PAGE>

"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND NEITHER SUCH SHARES NOR ANY INTEREST THEREIN MAY BE OFFERED,
SOLD, PLEDGED, ASSIGNED OR OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION
STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT, OR (2) IN
ACCORDANCE WITH THE PROVISIONS OF REGULATION S, OR (3) AN EXEMPTION FROM
REGISTRATION IS AVAILABLE UNDER THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS AND THE HOLDER HAS PROVIDED THE COMPANY WITH AN OPINION OF
COUNSEL TO SUCH EFFECT."

7.4.     Amendment to Certificate of Incorporation. Investor hereby agrees to
         vote any shares of capital stock that it may own directly or
         beneficially, for the amendment to the Certificate of Incorporation
         referenced in Section 6.19. Pending adoption of such amendment,
         Investor hereby agrees for itself and its successors and assigns that
         neither this Section 7.4 or Section 6.19 above, or any restriction on
         exercise of the Warrant shall be amended, modified or waived without
         the consent of the holders of a majority of the shares of Common Stock
         held by Persons who are not Affiliates of the Company, or the Investor
         or Affiliates of the Investor.

                                  ARTICLE VIII

                CONDITIONS PRECEDENT TO THE COMPANY'S OBLIGATIONS

         The obligation of the Company to consummate the transactions
contemplated hereby shall be subject to the fulfillment, on or prior to Closing
Date, of the following conditions:

8.1.     No Termination. This Agreement shall not have been terminated pursuant
         to Article X hereof.

8.2.     Representations True and Correct. The representations and warranties of
         the Investor contained in this Agreement shall be true and correct in
         all material respects on and as of the Closing Date with the same force
         and effect as if made on as of the Closing Date.

8.3.     Compliance with Covenants. The Investor shall have performed and
         complied in all material respects with all covenants, agreements, and
         conditions required by this Agreement to be performed or complied by it
         prior to or at the Closing Date.

8.4.     No Adverse Proceedings. On the Closing Date, no action or proceeding
         shall be pending by any public authority or individual or entity before
         any court or administrative body to restrain, enjoin, or otherwise
         prevent the consummation of this Agreement or the transactions
         contemplated hereby or to recover any damages or obtain other relief as
         a result of the transactions proposed hereby.

                                      -19-
<PAGE>

                                   ARTICLE IX

                 CONDITIONS PRECEDENT TO INVESTOR'S OBLIGATIONS

         The obligation of the Investors to consummate the transactions
contemplated hereby shall be subject to the fulfillment, on or prior to Closing
Date unless specified otherwise, of the following conditions:

9.1.     No Termination. This Agreement shall not have been terminated pursuant
         to Article X hereof.

9.2.     Representations True and Correct. The representations and warranties of
         the Company contained in this Agreement shall be true and correct in
         all material respects on and as of the Closing Date with the same force
         and effect as if made on as of the Closing Date.

9.3.     Compliance with Covenants. The Company shall have performed and
         complied in all material respects with all covenants, agreements, and
         conditions required by this Agreement to be performed or complied by it
         prior to or at the Closing Date.

9.4.     No Adverse Proceedings. On the Closing Date, no action or proceeding
         shall be pending by any public authority or individual or entity before
         any court or administrative body to restrain, enjoin, or otherwise
         prevent the consummation of this Agreement or the transactions
         contemplated hereby or to recover any damages or obtain other relief as
         a result of the transactions proposed hereby.

                                   ARTICLE X

                        TERMINATION, AMENDMENT AND WAIVER

10.1.    Termination. This Agreement may be terminated at any time prior to the
         Closing Date

10.1.1.  by mutual written consent of the Investor and the Company;

10.1.2.  by the Company upon a material breach of any representation, warranty,
         covenant or agreement on the part of the Investor set forth in this
         Agreement, or the Investor upon a material breach of any
         representation, warranty, covenant or agreement on the part of the
         Company set forth in this Agreement, or if any representation or
         warranty of the Company or the Investor, respectively, shall have
         become untrue, in either case such that any of the conditions set forth
         in Article VIII or Article IX hereof would not be satisfied (a
         "Terminating Breach"), and such breach shall, if capable of cure, not
         have been cured within five (5) business days after receipt by the
         party in breach of a notice from the non-breaching party setting forth
         in detail the nature of such breach.

10.2.    Effect of Termination. Except as otherwise provided herein, in the
         event of the termination of this Agreement pursuant to Section 10.1
         hereof, there shall be no liability on the part of the Company or the
         Investor or any of their respective officers, directors, agents or
         other representatives and all rights and obligations of any party
         hereto shall cease.

10.3.    Amendment. This Agreement may be amended by the parties hereto any time
         prior to the Closing Date by an instrument in writing signed by the
         parties hereto; provided, however that the 4.9% Limitation may not be
         amended or waived.

                                      -20-
<PAGE>

10.4.    Waiver. At any time prior to the Closing Date, the Company or the
         Investor, as appropriate, may: (a) extend the time for the performance
         of any of the obligations or other acts of other party or; (b) waive
         any inaccuracies in the representations and warranties contained herein
         or in any document delivered pursuant hereto which have been made to it
         or them; or (c) waive compliance with any of the agreements or
         conditions contained herein for its or their benefit other than the
         4.9% Limitation which may not be waived. Any such extension or waiver
         shall be valid only if set forth in an instrument in writing signed by
         the party or parties to be bound hereby.

                                   ARTICLE XI

                               GENERAL PROVISIONS

11.1.    Transaction Costs. Except as otherwise provided herein, each of the
         parties shall pay all of his or its costs and expenses (including
         attorney fees and other legal costs and expenses and accountants' fees
         and other accounting costs and expenses) incurred by that party in
         connection with this Agreement; provided, the Company shall pay
         Investor for its expenses as provided in Section 6.21.

11.2.    Indemnification. The Investor agrees to indemnify, defend and hold the
         Company (following the Closing Date) and its officers and directors
         harmless against and in respect of any and all claims, demands, losses,
         costs, expenses, obligations, liabilities or damages, including
         interest, penalties and reasonable attorney's fees, that it shall incur
         or suffer, which arise out of or result from any breach of this
         Agreement by such Investor or failure by such Investor to perform with
         respect to the representations, warranties or covenants contained in
         this Agreement or in any exhibit or other instrument furnished or to be
         furnished under this Agreement. The Company agrees to indemnify, defend
         and hold the Investor (following the Closing Date) harmless against and
         in respect of any and all claims, demands, losses, costs, expenses,
         obligations, liabilities or damages, including interest, penalties and
         reasonable attorney's fees, that it shall incur or suffer, which arise
         out of, result from or relate to any breach of this Agreement or
         failure by the Company to perform with respect to the representations,
         warranties or covenants contained in this Agreement or in any exhibit
         or other instrument furnished or to be furnished under this Agreement.
         In no event shall the Company or the Investors be entitled to recover
         consequential or punitive damages resulting from a breach or violation
         of this Agreement nor shall any party have any liability hereunder in
         the event of gross negligence or willful misconduct of the indemnified
         party. In the event of the failure of the Company to issue the Series A
         Preferred Stock and Warrants in violation of the provisions of this
         Agreement, the Investor, as its sole remedy, shall be entitled to
         pursue a remedy of specific performance upon tender into the Court an
         amount equal to the Purchase Price hereunder. The indemnification by
         the Investor shall be limited to $50,000.00. This Section 11.2 shall
         not relate to indemnification under the Registration Rights Agreement.

11.3.    Headings. The headings contained in this Agreement are for reference
         purposes only and shall not affect in any way the meaning or
         interpretation of this Agreement.

11.4.    Entire Agreement. This Agreement (together with the Schedule, Exhibits,
         Warrants and documents referred to herein) constitute the entire
         agreement of the parties and supersede all prior agreements and
         undertakings, both written and oral, between the parties, or any of
         them, with respect to the subject matter hereof.

                                      -21-
<PAGE>

11.5.    Notices. All notices and other communications hereunder shall be in
         writing and shall be deemed to have been given (i) on the date they are
         delivered if delivered in person; (ii) on the date initially received
         if delivered by facsimile transmission followed by registered or
         certified mail confirmation; (iii) on the date delivered by an
         overnight courier service; or (iv) on the on the date of delivery as
         shown on the return receipt, if mailed by registered or certified mail,
         return receipt requested with postage and other fees prepaid as
         follows:

                           If to the Company:

                           Mr. James G. Reindl, President
                           Techprecision, LLC
                           P.O. Box 4651
                           Greenville, DE 19807

                           With a copy to:
                           --------------

                           Katsky Korins LLP
                           605 Third Avenue
                           New York, New York 10158
                           Attention: Asher S. Levitsky P.C.
                           Facsimile No.: (212) 716-3338

                           If to the Investor:

                           Barron Partners L.P.
                           c/o Barron Capital Advisors, LLC
                           730 Fifth Avenue, 9th Floor
                           New York, New York  10019
                           Attn: Andrew Barron Worden

11.6.    Severability. If any term or other provision of this Agreement is
         invalid, illegal or incapable of being enforced by any rule of law or
         public policy, all other conditions and provisions of this Agreement
         shall nevertheless remain in full force and effect so long as the
         economic or legal substance of the transactions contemplated hereby is
         not affected in any manner materially adverse to any party. Upon such
         determination that any such term or other provision is invalid, illegal
         or incapable of being enforced, the parties hereto shall negotiate in
         good faith to modify this Agreement so as to effect the original intent
         of the parties as closely as possible in an acceptable manner to the
         end that the transactions contemplated hereby are fulfilled to the
         extent possible.

11.7.    Binding Effect. All the terms and provisions of this Agreement whether
         so expressed or not, shall be binding upon, inure to the benefit of,
         and be enforceable by the parties and their respective administrators,
         executors, legal representatives, heirs, successors and assignees.

11.8.    Preparation of Agreement. This Agreement shall not be construed more
         strongly against any party regardless of who is responsible for its
         preparation. The parties acknowledge each contributed and is equally
         responsible for its preparation.

                                      -22-
<PAGE>

11.9.    Governing Law. This Agreement shall be governed by, and construed in
         accordance with, the laws of the State of New York, without giving
         effect to applicable principles of conflicts of law.

11.10.   Jurisdiction. This Agreement shall be exclusively governed by and
         construed in accordance with the laws of the State of New York. If any
         action is brought among the parties with respect to this Agreement or
         otherwise, by way of a claim or counterclaim, the parties agree that in
         any such action, and on all issues, the parties irrevocably waive their
         right to a trial by jury. Exclusive jurisdiction and venue for any such
         action shall be the federal and state courts situated in the City,
         County and State of New York. In the event suit or action is brought by
         any party under this Agreement to enforce any of its terms, or in any
         appeal therefrom, it is agreed that the prevailing party shall be
         entitled to reasonable attorneys fees to be fixed by the arbitrator,
         trial court, and/or appellate court if such party prevails on
         substantially all issues in dispute.

11.11.   Preparation and Filing of Securities and Exchange Commission filings.
         The Investor shall reasonably assist and cooperate with the Company in
         the preparation of all filings with the SEC after the Closing Date due
         after the Closing Date.

11.12.   Further Assurances, Cooperation. Each party shall, upon reasonable
         request by the other party, execute and deliver any additional
         documents necessary or desirable to complete the transactions herein
         pursuant to and in the manner contemplated by this Agreement. The
         parties hereto agree to cooperate and use their respective best efforts
         to consummate the transactions contemplated by this Agreement.

11.13.   Survival. The representations, warranties, covenants and agreements
         made herein shall survive the Closing of the transaction contemplated
         hereby.

11.14.   Third Parties. Except as disclosed in this Agreement, nothing in this
         Agreement, whether express or implied, is intended to confer any rights
         or remedies under or by reason of this Agreement on any persons other
         than the parties hereto and their respective administrators, executors,
         legal representatives, heirs, successors and assignees. Nothing in this
         Agreement is intended to relieve or discharge the obligation or
         liability of any third persons to any party to this Agreement, nor
         shall any provision give any third persons any right of subrogation or
         action over or against any party to this Agreement.

11.15.   Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or
         delay on the part of any party hereto in the exercise of any right
         hereunder shall impair such right or be construed to be a waiver of, or
         acquiescence in, any breach of any representation, warranty, covenant
         or agreement herein, nor shall nay single or partial exercise of any
         such right preclude other or further exercise thereof or of any other
         right. All rights and remedies existing under this Agreement are
         cumulative to, and not exclusive of, any rights or remedies otherwise
         available.

11.16.   Counterparts. This Agreement may be executed in one or more
         counterparts, and by the different parties hereto in separate
         counterparts, each of which when executed shall be deemed to be an
         original, but all of which taken together shall constitute one and the
         same agreement. A facsimile transmission of this signed Agreement shall
         be legal and binding on the party who delivered the Agreement by
         facsimile transmission; provided, that such party shall promptly
         deliver the signed Agreement by overnight courier services.

                                      -23-
<PAGE>

                         [SIGNATURES ON FOLLOWING PAGE]

                                      -24-
<PAGE>

         IN WITNESS WHEREOF, the Investors and the Company have as of the date
first written above executed this Agreement.

THE COMPANY:

LOUNSBERRY HOLDINGS II, INC.

/s/ James G. Reindl
----------------------------
James G. Reindl, Chairman

INVESTOR:

BARRON PARTNERS LP
By:  Barron Capital Advisors, LLC, its General Partners

/s/ Andrew Barron Worden
----------------------------
Andrew Barron Worden
President
730 Fifth Avenue, 9th Floor
New York NY 10019

                                      -25-
<PAGE>

                                   Schedule A

<TABLE>
<CAPTION>
                                                       NUMBER OF SHARES
                                                       OF COMMON STOCK         NUMBER OF SHARES
                                    AMOUNT OF        INTO WHICH PREFERRED     UNDERLYING "A" AND
NAME AND ADDRESS                   INVESTMENT        STOCK IS CONVERTIBLE        "B" WARRANTS
----------------                   ----------        --------------------     --------------------

<S>                                <C>                    <C>                 <C>
Barron Partners LP
730 Fifth Avenue, 9th Floor
New York, New York 10019           $2,200,000             7,719,250           5,610,000/5,610,000
Attn: Andrew Barron Worden
</TABLE>

                                      -26-
<PAGE>

                         Schedule 4.3.1 - Capitalization

                                                    Ranor Capitalization 022406

<TABLE>
<CAPTION>
                                                                     % of
                                                                     outstanding      % of             % of
Description                                         No. Shares       plus preferred   fully-diluted    actual o/s

<S>                                                    <C>                 <C>             <C>         <C>
Original Investor Group                                9,867,000           55.37%          32.85%      99.00%
Restricted Stock Grants to be issued                     133,000            0.75%           0.44%
Barron Partners (on conversion of preferred)           7,719,250           43.32%          25.70%
Public Stockholders                                      100,000            0.56%           0.33%       1.00%
Total Outstanding, including Barron conversion        17,819,250
Total Outstanding (actual)                             9,967,000

Barron warrants A                                      5,610,000                           18.68%                   $0.570
Barron warrants B                                      5,610,000                           18.68%                   $0.855
Stock option/incentive plan                            1,000,000                            3.33%
Total fully-diluted                                   30,039,250

                                                                          100.00%         100.00%     100.00%
</TABLE>

                                      -27-
<PAGE>

                         Schedule 4.8 - List of Brokers

None

                                      -28-
<PAGE>

                                    Exhibit A

    Form of Certificate of Deisgnation of Preferences, Rights and Limitations

                                See Exhibit 3.3

                                      -29-
<PAGE>

                                    Exhibit B

                          Registration Rights Agreement

                                See Exhibit 10.2

                                      -30-
<PAGE>
                                    Exhibit C

                                    Warrants

                                See Exhibit 4.3

                                      -31-Exhibit 10.2
                          REGISTRATION RIGHTS AGREEMENT

THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and entered into as
of 24th day of February, 2006 by and among Lounsberry Holdings II, Inc., a
corporation organized and existing under the laws of the State of Delaware (the
"Company"), and Barron Partners L.P., a Delaware limited partnership
(hereinafter referred to as the "Investor"). Unless defined otherwise,
capitalized terms herein shall have the identical meaning as in the Preferred
Stock Purchase Agreement, of even date herewith (the "Purchase Agreement"), by
and among the Company and the Investor.

                              PRELIMINARY STATEMENT

         WHEREAS, pursuant to the Purchase Agreement, the Investor is purchasing
Preferred Stock and Warrants, which entitle the Investor to receive Shares of
the Company upon conversion or exercise thereof; and

         WHEREAS, the ability of the Investor to sell their Shares of Common
Stock is subject to certain restrictions under the 1933 Act; and

         WHEREAS, as a condition to purchase of Preferred Stock and Warrants
pursuant to the Purchase Agreement, the Company has agreed to provide the
Investor with a mechanism that will permit such Investor, subject to a market
stand-off agreement, to sell its Shares of Common Stock in the future.

         NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements, and subject to the terms and conditions herein
contained, the parties hereto hereby agree as follows:

                                   ARTICLE I

                     INCORPORATION BY REFERENCE, SUPERSEDER

1.1. Incorporation by Reference. The foregoing recitals and the Exhibits
attached hereto and referred to herein, are hereby acknowledged to be true and
accurate, and are incorporated herein by this reference.

1.2. Superseder. This Agreement, to the extent that it is inconsistent with any
other instrument or understanding among the parties governing the affairs of the
Company, shall supersede such instrument or understanding to the fullest extent
permitted by law. A copy of this Agreement shall be filed at the Company's
principal office.

                                   ARTICLE II

                           DEMAND REGISTRATION RIGHTS

2.1. Registrable Securities. The term "Registrable Securities" shall means and
include the Shares of the Company underlying the Preferred Stock and Warrants
issued pursuant to the Purchase Agreement. As to any particular Registrable
Securities, such securities will cease to be Registrable Securities when (a)
they have been effectively registered under the 1933 Act and disposed of in
accordance with the registration statement covering them, (b) they are or may be
freely traded without registration pursuant to Rule 144 under the 1933 Act (or
any similar provisions that are then in effect), or (c) they have been otherwise
transferred and new certificates for them not bearing a restrictive legend have
been issued by the Company and the Company shall not have "stop transfer"
instructions against them. "Shares" shall mean, collectively, the shares of
Common Stock of the Company issuable upon conversion of the Preferred Stock and
those shares of Common Stock of the Company issuable to the Investor upon
exercise of the Warrants.

<PAGE>

2.2. Registration of Registrable Securities. The Company shall prepare and file
within sixty (60) days following the date hereof (the "Filing Date") a
registration statement (the "Registration Statement") covering the sale of such
number of shares of the Registrable Securities as the Investor shall elect by
written notice to the Company, and absent such election, covering the sale of
all of the shares of the Registrable Securities. The Company shall use its best
efforts to cause the Registration Statement to be declared effective by the SEC
on the first to occur of (i) 120 days following the Filing Date with respect to
the Registration Statement, (ii) ten (10) days following the receipt of a "No
Review" or similar letter from the SEC or (iii) the third (3rd) business day
following the day the Company receives notice from the SEC that the SEC has
determined that the Registration Statement eligible to be declared effective
without further comments by the SEC (the "Required Effectiveness Date"). Nothing
contained herein shall be deemed to limit the number of Registrable Securities
to be registered by the Company hereunder. As a result, should the Registration
Statement not relate to the maximum number of Registrable Securities acquired by
(or potentially acquirable by) the holders of the Shares of the Company issued
to the Investor pursuant to the Purchase Agreement and the Warrants, other than
as a result of the election by the holder thereof not to have Shares included in
the Registration Statement, the Company shall be required to promptly file a
separate registration statement (utilizing Rule 462 promulgated under the 1933
Act, if applicable) relating to such Registrable Securities which then remain
unregistered. The provisions of this Agreement shall relate to any such separate
registration statement as if it were an amendment to the Registration Statement.

2.3. Demand Registration. Subject to the limitations of Section 2.2, at any time
and from time to time, the Investor may request the registration under the 1933
Act of all or part of the Registrable Securities then outstanding (a "Demand
Registration"). Subject to the conditions of Section 3, the Company shall use
its commercially reasonable best efforts to file such registration statement
under the 1933 Act as promptly as practicable after the date any such request is
received by the Company and to cause such registration statement to be declared
effective. The Company shall notify the Investor promptly when any such
registration statement has been declared effective. If more than eighty percent
(80%) of the Shares issuable under the Purchase Agreement have been registered
or sold, the Company's obligations under this Article II shall terminate.

2.4. Registration Statement Form. Registrations under Section 2.2 and Section
2.3 shall be on the appropriate registration form of the SEC as shall permit the
disposition of such Registrable Securities in accordance with the intended
method or methods of disposition specified in the Registration Statement;
provided, however, such intended method of disposition shall not include an
underwritten offering of the Registrable Securities.

2.5. Expenses. The Company will pay all Registration Expenses in connection with
any registration required by under Sections 2.2 and Section 2.3 herein.
Registration Expenses shall mean all expenses incident to the Company's
performance of or compliance with its obligations under this Agreement,
including, without limitation, all registration, filing, listing, stock exchange
and NASD fees, all fees and expenses of complying with state securities or blue
sky laws (including fees, disbursements and other charges of counsel for the
underwriters only in connection with blue sky filings), all word processing,
duplicating and printing expenses, messenger and delivery expenses, the fees,
disbursements and other charges of counsel for the Company and of its
independent public accountants, including the expenses incurred in connection
with "cold comfort" letters required by or incident to such performance and
compliance, any fees and disbursements of underwriters customarily paid by the
issuer of securities, but excluding from the definition of Expenses underwriting
and discounts and brokerage commissions and applicable transfer taxes, if any,
or legal and other expenses incurred by any sellers, which discounts,
commissions, transfer taxes and legal and other expenses shall be borne by the
seller or sellers of Registrable Securities in all cases.

                                     - 2 -
<PAGE>

2.6. Effective Registration Statement. A registration requested pursuant to
Sections 2.2 and Section 2.3 shall not be deemed to have been effected, other
than for an Excused Reason, as hereinafter defined, (i) unless a registration
statement with respect thereto has become effective, provided that a
registration which does not become effective after the Company filed a
registration statement with respect thereto solely by reason of the refusal to
proceed of any holder of Registrable Securities (other than a refusal to proceed
based upon the advice of counsel in the form of a letter signed by such counsel
and provided to the Company relating to a disclosure matter unrelated to such
holder) shall be deemed to have been effected by the Company, (ii) if, after it
has become effective, such registration becomes subject to any stop order,
injunction or other order or extraordinary requirement of the SEC or other
governmental agency or court for any reason and such stop order or other action
continues in effect for five trading days or (iii) if, after it has become
effective, such registration ceases to be effective for more than the allowable
Black-Out Periods, as hereinafter defined. An Excused Reason shall include,
without limitation, acts of God, strikes, lockouts or other acts of industrial
disturbance, acts of public enemies, death or incapacitating illness affecting
key personnel, events which result in the full or partial closure of the SEC,
orders of any kind of federal, state, provincial or local government or
government subdivision or officials or civil or military authorities,
insurrections, war, civil uprisings, riots, fire, hurricanes, tornados, storms,
floods, washouts, blackouts or other power failure, droughts, restraints of
governments and individuals, civil disturbances, explosions, breakages or
accidents to machinery, transmission pipes or cables, partial or entire failure
of utilities or communications networks, or any other cause or event not
reasonably within the control of the party claiming the inability to perform.

2.7. Plan of Distribution. The Company hereby agrees that the Registration
Statement shall include a plan of distribution section reasonably acceptable to
the Investor; provided, however, such plan of distribution section shall be
modified by the Company so as to not provide for the disposition of the
Registrable Securities on the basis of an underwritten offering.

2.8. Liquidated Damages.

      (i) In the event (a) the Company does not file the Registration Statement
covering the Registrable Securities by the Filing Date as required by Section
2.2 herein, or (b) the Registration Statement filed pursuant to Section 2.2
herein is not declared effective by the Required Effectiveness Date as provided
in said Section 2.2, or (c) if the Registrable Securities are registered
pursuant to an effective Registration Statement and such Registration Statement
or other Registration Statement(s) demanded by Investor including the
Registrable Securities is not effective in the period from the Required
Effective Date through two years following the date hereof other than for a
Black-out Period, the Company shall, for each such day (x) after the Filing Date
that the Company shall not have filed the Registration Statement, (y) after the
Required Effectiveness Date that the Registration Statement shall not have been
declared effective, or (z) during which the Registration Statement is not
effective as required by clause (c) of this Section 2.8(i), issue to the
Investor, as liquidated damages and not as a penalty, 2,540 shares of Preferred
Stock for any such day (based on a 365 day working calendar year), such issuance
shall be made no later than the tenth business day of the calendar month next
succeeding the month in which such day occurs; provided, however, that if the
Registration Statement does not cover, or registration has not been requested
for, the Registrable Securities issuable upon conversion of all of the shares of
Preferred Stock that were issued by the Company, the liquidated damages per day
shall be the percentage of 2,540 that the number of Registrable Securities then
subject to, or proposed to be include in, the Registration Statement bears to
the total number Registrable Securities issued or issuable upon conversion of
all of the Preferred Stock that were initially issued to the Investor. However,
in no event shall the Company be required to pay any liquidated damages under
this Section 2.8 in an amount exceeding 1.4 million shares of Preferred Stock in
the aggregate (as adjusted pursuant to the terms of the Certificate of
Designation).

                                     - 3 -
<PAGE>

      (ii) Notwithstanding the provisions of Section 2.8(i):

            (a) In the event that the Company shall fail to file the
Registration Statement by the Filing Date but the Registration Statement shall
have been declared effective by the Required Effectiveness Date, then no
liquidated damages shall be payable with respect to the failure to file by the
Filing Date. The Company may defer the issuance of any such shares of Preferred
Stock until the first date after the Required Effectiveness Date that the
Company is required to pay liquidated damages pursuant to Section 2.8(i).

            (b) Any liquidated damages payable as a result of the failure to
file the Registration Statement by the Filing Date shall be credited against
liquidated damages payable as a result of the failure of the Registration
Statement to be declared effective by the Required Effectiveness Date.

            (c) In the event that, at the time of a failure of the Company to
maintain the effectiveness of the Registration Statement, the Holder shall own
less than the number of shares of Preferred Stock initially issued by the
Company, the number of shares of Preferred Stock issuable per day shall be
reduced to a fraction of 2,540 shares of Preferred Stock, the numerator of which
is the number of shares of Preferred Stock then owned by the Holder and the
denominator is the number of shares of Preferred Stock initially issued to the
Holder.

            (d) The Company shall have the right, in its discretion, to pay cash
in lieu of issuing shares of Preferred Stock, with the value per share being the
initial purchase price of one share of Preferred Stock.

            (e) No fractional shares shall be issued. Any fractional shares
which would otherwise be issued on any date on which Preferred Stock is to be
issued pursuant to Section 2.8(i) of this Agreement, shall be carried forward;
provided, however, that if, at the expiration of the period during which
liquidated damages is payable there remains a fractional shall which has not
been applied to liquidated damages, the Company shall have no further obligation
to issue such fractional share.

      (iii) In no event shall the Company be required to pay any liquidated
damages in the event that the failure of the registration statement to be
declared effective on the Required Effective Date results in whole or in part
from either (a) the failure of the Investor to provide information relating to
the Investor and its proposed method of sale or any other information concerning
the Investor that is required to be included in the registration statement or
(b) any delays resulting from questions raised by the SEC or any other
regulatory agency, market or exchange concerning the Investor or the affiliates
of the Investor.

      (iv) The parties hereto agree that the liquidated damages provided for in
this Section 2.8 constitute a reasonable estimate of the damages that may be
incurred by the Investor by reason of the failure of the Registration
Statement(s) to be filed or declared effective in accordance with the provisions
hereof.

      (v) The obligation of the Company terminates when the Investor no longer
holds more than eleven percent (11%) of the Registrable Securities, based on the
number of Registrable Securities. initially issuable pursuant to the Purchase
Agreement and any shares issued due to adjustments in these transaction
documents and the Warrants.

                                     - 4 -
<PAGE>

                                  ARTICLE III

                         INCIDENTAL REGISTRATION RIGHTS

3.1. Right To Include ("Piggy-Back") Registrable Securities. Provided that the
Registrable Securities have not been registered, if at any time after the date
hereof but before the second anniversary of the date hereof, the Company
proposes to register any of its securities under the 1933 Act (other than by a
registration in connection with an acquisition in a manner which would not
permit registration of Registrable Securities for sale to the public, on Form
S-8, or any successor form thereto, on Form S-4, or any successor form thereto
and other than pursuant to Section 2), on an underwritten basis (either
best-efforts or firm-commitment), then, the Company will each such time give
prompt written notice to all holders of Registrable Securities of its intention
to do so and of such holders of Registrable Securities' rights under this
Section 3.1. Upon the written request of any such holders of Registrable
Securities made within ten (10) days after the receipt of any such notice (which
request shall specify the Registrable Securities intended to be disposed of by
such holders of Registrable Securities and the intended method of disposition
thereof), the Company will, subject to the terms of this Agreement, use its
commercially reasonable best efforts to effect the registration under the 1933
Act of the Registrable Securities, to the extent requisite to permit the
disposition (in accordance with the intended methods thereof as aforesaid) of
such 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 that if, at any time after
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 either not to register
or to delay registration of such securities, the Company may, at its election,
give written notice of such determination to each holders of Registrable
Securities and, thereupon, (i) in the case of a determination not to register,
shall be relieved of this 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 any holder or holders of Registrable Securities entitled to do so
to request that such registration be effected as a registration under Section 2,
and (ii) in the case of a determination to delay registering, shall be permitted
to delay registering any Registrable Securities, for the same period as the
delay in registering such other securities. No registration effected under this
Section 3.1 shall relieve the Company of its obligation to effect any
registration upon request under Section 2 except to the extent that any
Registrable Securities are registered pursuant to such registration statement.
The Company will pay all Registration Expenses in connection with each
registration of Registrable Securities requested pursuant to this Section 3.1.

3.2. Priority In Incidental Registrations. If the managing underwriter of the
underwritten offering contemplated by this Section 3 shall inform the Company
and holders of the Registrable Securities requesting such registration by letter
of its belief that the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering, then the
Company will include in such registration, to the extent of the number which the
Company is so advised can be sold in such offering, (i) first securities
proposed by the Company to be sold for its own account, and (ii) second to
holders of securities having demand registration rights and exercising such
rights in connection with such registration statement, (iii) third Registrable
Securities and securities of other selling security holders (including Insiders,
as defined in the Purchase Agreement) who requested to be included in such
registration on a pari passu basis.

                                   ARTICLE IV

                             REGISTRATION PROCEDURES

4.1. Registration Procedures. If and whenever the Company is required to effect
the registration of any Registrable Securities under the 1933 Act as provided in
Section 2.2 and, as applicable, 2.3, the Company shall, as expeditiously as
possible:

                                     - 5 -
<PAGE>

      (i) prepare and file with the SEC the Registration Statement, or
amendments thereto, to effect such registration (including such audited
financial statements as may be required by the 1933 Act or the rules and
regulations promulgated thereunder) and thereafter use its commercially
reasonable best efforts to cause such registration statement to be declared
effective by the SEC, as soon as practicable, but in any event no later than the
Required Effectiveness Date (with respect to a registration pursuant to Section
2.2); provided, however, that before filing such registration statement or any
amendments thereto, the Company will furnish to the counsel selected by the
holders of Registrable Securities which are to be included in such registration,
copies of all such documents proposed to be filed;

      (ii) with respect to any registration statement pursuant to Section 2.2 or
Section 2.3, 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 keep such registration statement effective and to comply
with the provisions of the 1933 Act with respect to the disposition of all
Registrable Securities covered by such registration statement until the earlier
to occur of thirty six (36) months after the date of this Agreement (subject to
the right of the Company to suspend the effectiveness thereof for not more than
15 consecutive Trading Days or an aggregate of 20 Trading Days during each year
(each a "Black-Out Period")) or such time as all of the securities which are the
subject of such registration statement cease to be Registrable Securities (such
period, in each case, the "Registration Maintenance Period"). The Company must
notify the Investor within twenty four (24) hours prior to any Black-Out Period;

      (iii) furnish to each holder of Registrable Securities covered by such
registration statement such number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including all exhibits), such number of copies of the prospectus contained in
such registration statement (including each preliminary prospectus and any
summary prospectus) and any other prospectus filed under Rule 424 under the 1933
Act, in conformity with the requirements of the 1933 Act, and such other
documents, as such holder of Registrable Securities and underwriter, if any, may
reasonably request in order to facilitate the public sale or other disposition
of the Registrable Securities owned by such holder of Registrable Securities;

      (iv) use its commercially reasonable best efforts to register or qualify
all Registrable Securities and other securities covered by such registration
statement under such other U.S. federal or state securities laws or U.S. state
blue sky laws as any U.S. holder of Registrable Securities thereof shall
reasonably request, to keep such registrations or qualifications in effect for
so long as such registration statement remains in effect, and take any other
action which may be reasonably necessary to enable such holder of Registrable
Securities to consummate the disposition in such jurisdictions of the securities
owned by such holder of Registrable Securities, except that the Company shall
not for any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction wherein it would not but for the
requirements of this subdivision (iv) be obligated to be so qualified or to
consent to general service of process in any such jurisdiction;

      (v) use its commercially reasonable best efforts to cause all 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 U.S. holder of Registrable Securities thereof to consummate the
disposition of such Registrable Securities;

      (vi) furnish to each holder of Registrable Securities a signed
counterpart, addressed to such holder of Registrable Securities, and the
underwriters, if any, of an opinion of counsel for the Company, dated the
effective date of such registration statement (or, if such registration includes
an underwritten public offering, an opinion dated the date of the closing under
the underwriting agreement), such opinion to be in the form filed as Exhibit 5
to the registration statement, and

                                     - 6 -
<PAGE>

      (vii) notify the Investor and its counsel promptly and confirm such advice
in writing promptly after the Company has knowledge thereof:

            (a) when the Registration Statement, the prospectus or any
prospectus supplement related thereto or post-effective amendment to the
Registration Statement has been filed, and, with respect to the Registration
Statement or any post-effective amendment thereto, when the same has become
effective;

            (b) of any request by the SEC for amendments or supplements to the
Registration Statement or the prospectus or for additional information;

            (c) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
by any Person for that purpose; and

            (d) of the receipt by the Company of any notification with respect
to the suspension of the qualification of any Registrable Securities for sale
under the securities or blue sky laws of any jurisdiction or the initiation or
threat of any proceeding for such purpose;

      (viii) notify each holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the 1933 Act, upon discovery that, or upon the
happening of any event as a result of which, the prospectus included in such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material facts required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances then existing, and at the request of any such holder of
Registrable Securities promptly prepare and furnish to such holder of
Registrable Securities a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing;

      (ix) use its commercially reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of the Registration Statement at the
earliest possible moment;

      (x) otherwise use its commercially 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
covering the period of at least twelve months, but not more than eighteen
months, beginning with the first full calendar month after the effective date of
such registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder;

      (xi) enter into such agreements and take such other actions as the
Investor shall reasonably request in writing (at the expense of the requesting
or benefiting Investor) in order to expedite or facilitate the disposition of
such Registrable Securities; and

      (xii) use its commercially reasonable best efforts to list all Registrable
Securities covered by such registration statement on any securities exchange on
which any of the Registrable Securities are then listed.

      The Company may require each holder of Registrable Securities as to which
any registration is being effected to furnish the Company such information
regarding such holder of Registrable Securities and the distribution of such
securities as the Company may from time to time reasonably request in writing,
including

                                     - 7 -
<PAGE>

            (a) furnish the information as to any shares of Common Stock or
other securities of the Company owned by the holder, the holder's proposed plan
of distribution, any relationship between the holder and the Company and any
other information which the Company reasonably requests in connection with the
preparation of the registration statement and update such information
immediately upon the occurrence of any events or condition which make the
information concerning the Seller inaccurate in any material respect;

            (b) not sell any Registrable Securities pursuant to the registration
statement except in the manner set forth in the Registration Statement;

            (c) comply with the prospectus delivery requirements and the
provisions of Regulation M of the SEC pursuant to the 1933 Act to the extent
that such regulation is applicable to the holder;

            (d) not sell or otherwise transfer or distribute any Registrable
Securities if the holder possesses any material nonpublic information concerning
the Company.

4.2. The Company will not file any registration statement pursuant to Section
2.2 or Section 2.3, or amendment thereto or any prospectus or any supplement
thereto to which the Investor shall reasonably object, provided that the Company
may file such documents in a form required by law or upon the advice of its
counsel.

4.3. The Company represents and warrants to each holder of Registrable
Securities that it has obtained all necessary waivers, consents and
authorizations necessary to execute this Agreement and consummate the
transactions contemplated hereby other than such waivers, consents and/or
authorizations specifically contemplated by the Purchase Agreement.

4.4. Each holder of Registrable Securities agrees that, upon receipt of any
notice from the Company of the occurrence of any event of the kind described in
subdivision (viii) of Section 4.1, such Holder will forthwith discontinue such
holder of Registrable Securities' disposition of Registrable Securities pursuant
to the Registration Statement relating to such Registrable Securities until such
holder of Registrable Securities' receipt of the copies of the supplemented or
amended prospectus contemplated by subdivision (viii) of Section 4.1 and, if so
directed by the Company, will deliver to the Company (at the Company's expense)
all copies, other than permanent file copies, then in such Holder's possession
of the prospectus relating to such Registrable Securities current at the time of
receipt of such notice.

                                   ARTICLE V

                             UNDERWRITTEN OFFERINGS

5.1. Incidental Underwritten Offerings. If the Company at any time proposes to
register any of its securities under the 1933 Act as contemplated by Section 3.1
and such securities are to be distributed by or through one or more
underwriters, the Company will, if requested by any holder of Registrable
Securities as provided in Section 3.1 and subject to the provisions of Section
3.2, use its commercially 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. In no
event shall any Investor be deemed an underwriter for purposes of this
Agreement. This Article V shall not apply to any Registrable Securities
theretofore registered pursuant to Article II of this Agreement.

                                     - 8 -
<PAGE>

5.2. Participation In Underwritten Offerings. No holder of Registrable
Securities may participate in any underwritten offering under Section 3.1 unless
such holder of Registrable Securities (i) agrees to sell such Person's
securities on the basis provided in any underwriting arrangements approved,
subject to the terms and conditions hereof, by the holders of a majority of
Registrable Securities to be included in such underwritten offering and (ii)
completes and executes all questionnaires, indemnities, underwriting agreements
and other documents (other than powers of attorney) required under the terms of
such underwriting arrangements. Notwithstanding the foregoing, no underwriting
agreement (or other agreement in connection with such offering) shall require
any holder of Registrable Securities to make a representation or warranty to or
agreements with the Company or the underwriters other than representations and
warranties contained in a writing furnished by such holder of Registrable
Securities expressly for use in the related registration statement or
representations, warranties or agreements regarding such holder of Registrable
Securities, such holder's Registrable Securities and such holder's intended
method of distribution and any other representation required by law.

5.3. Preparation; Reasonable Investigation. In connection with the preparation
and filing of each registration statement under the 1933 Act pursuant to this
Agreement, the Company will give the holders of Registrable Securities
registered under such registration statement, and their respective counsel and
accountants, the opportunity to participate in the preparation of such
registration statement, each prospectus included therein or filed with the SEC,
and each amendment thereof or supplement thereto, and will give each of them
such access to its books and records and such opportunities to discuss the
business of the Company with its officers and the independent public accountants
who have certified its financial statements as shall be necessary, in the
reasonable opinion of such holders' and such underwriters' respective counsel,
to conduct a reasonable investigation within the meaning of the 1933 Act.

                                   ARTICLE VI

                                 INDEMNIFICATION

6.1. Indemnification by the Company. In the event of any registration of any
securities of the Company under the 1933 Act, the Company will, and hereby does
agree to indemnify and hold harmless the holder of any Registrable Securities
covered by such registration statement, its directors and officers, each other
Person who participates as an underwriter in the offering or sale of such
securities and each other Person, if any, who controls such holder or any such
underwriter within the meaning of the 1933 Act against any losses, claims,
damages or liabilities, joint or several, to which such holder or any such
director or officer or underwriter or controlling person may become subject
under the 1933 Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such securities were registered under the 1933 Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and the Company will reimburse such holder
and each such director, officer, underwriter and controlling person for any
legal or any other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, liability, action or
proceeding, provided that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage, liability, (or action or
proceeding in respect thereof) or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in such registration statement, any such preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by such holder or
underwriter stating that it is for use in the preparation thereof and, provided
further that the Company shall not be liable to any Person who participates as
an underwriter in the offering or sale of Registrable Securities or to

                                     - 9 -
<PAGE>

any other Person, if any, who controls such underwriter within the meaning of
the 1933 Act, in any such case to the extent that any such loss, claim, damage,
liability (or action or proceeding in respect thereof) or expense arises out of
such Person's failure to send or give a copy of the final prospectus, as the
same may be then supplemented or amended, within the time required by the 1933
Act to the Person asserting the existence of an untrue statement or alleged
untrue statement or omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such Person if such
statement or omission was corrected in such final prospectus or an amendment or
supplement thereto. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such holder or any such
director, officer, underwriter or controlling person and shall survive the
transfer of such securities by such holder.

6.2. Indemnification by the Investor. The Company may require, as a condition to
including any Registrable Securities in any registration statement filed
pursuant to this Agreement, that the Company shall have received an undertaking
satisfactory to it from the prospective holder of such Registrable Securities,
to indemnify and hold harmless (in the same manner and to the same extent as set
forth in Section 6.1) the Company, each director of the Company, each officer of
the Company and each other Person, if any, who controls the Company within the
meaning of the 1933 Act, with respect to any statement or alleged statement in
or omission or alleged omission from such registration statement, any
preliminary prospectus, final prospectus or summary prospectus contained
therein, or any amendment or supplement thereto, if such statement or alleged
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company through an
instrument duly executed by such holder of Registrable Securities specifically
stating that it is for use in the preparation of such registration statement,
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement. Any such indemnity shall remain in full force and effect, regardless
of any investigation made by or on behalf of the Company or any such director,
officer or controlling person and shall survive the transfer of such securities
by such Investor. The indemnification by the Investor shall be limited to Fifty
Thousand ($50,000.0) Dollars.

6.3. Notices Of Claims, Etc. Promptly after receipt by an indemnified party of
notice of the commencement of any action or proceeding involving a claim
referred to in Sections 6.1 and Section 6.2, such indemnified party will, if
claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action, provided that
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under Sections 6.1 and Section
6.2, except to the extent that the indemnifying party is actually prejudiced by
such failure to give notice. In case any such action is brought against an
indemnified party, unless in such reasonable judgment of counsel to the
indemnified party, a conflict of interest, as hereinafter defined, between such
indemnified and indemnifying parties may exist in respect of such claim, the
indemnifying party shall be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified, to the
extent that the indemnifying party may wish, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
for any legal or other expenses subsequently incurred by the latter in
connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party shall, without the consent of the
indemnified party, consent to entry of any judgment or enter into any settlement
of any such action which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability, or a covenant not to sue, in respect to such claim or litigation.
No indemnified party shall consent to entry of any judgment or enter into any
settlement of any such action the defense of which has been assumed by an
indemnifying party without the consent of such indemnifying party. If the
defendants in any action covered by this Section 6.3 include both the
indemnified party and the indemnifying party and counsel for the indemnified
party shall have reasonably concluded that there may be reasonable defenses
available to it which are different from or additional to those

                                     - 10 -
<PAGE>

available to the indemnifying party or if the interests of the indemnified party
reasonably may be deemed to conflict with the interests of the indemnifying
party (collectively, a "conflict of interest"), the indemnified parties, as a
group, shall have the right to select one separate counsel and to assume such
legal defenses and otherwise to participate in the defense of such action, with
the reasonable expenses and fees of such separate counsel and other expenses
related to such participation to be reimbursed by the indemnifying party. Such
counsel shall be selected by the holders of a majority of the shares of Common
Stock having an indemnity claim against the Company, whether pursuant to this
Agreement or any other agreements which provide such or similar indemnity.

6.4. Other Indemnification. Indemnification similar to that specified in
Sections 6.1 and Section 6.2 (with appropriate modifications) shall be given by
the Company and each holder of Registrable Securities (but only if and to the
extent required pursuant to the terms herein) with respect to any required
registration or other qualification of securities under any Federal or state law
or regulation of any governmental authority, other than the 1933 Act.

6.5. Indemnification Payments. The indemnification required by Sections 6.1 and
Section 6.2 shall be made by periodic payments of the amount thereof during the
course of the investigation or defense, as and when bills are received or
expense, loss, damage or liability is incurred.

6.6. Contribution.

      (i) If the indemnification provided for in Sections 6.1 and Section 6.2 is
unavailable to an indemnified party in respect of any expense, loss, claim,
damage or liability referred to therein, then each indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such expense, loss, claim,
damage or liability (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the holder of
Registrable Securities or underwriter, as the case may be, on the other from the
distribution of the Registrable Securities or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the
holder of Registrable Securities or underwriter, as the case may be, on the
other in connection with the statements or omissions which resulted in such
expense, loss, damage or liability, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the holder of Registrable Securities or underwriter, as the case may be, on
the other in connection with the distribution of the Registrable Securities
shall be deemed to be in the same proportion as the total net proceeds received
by the Company from the initial sale of the Registrable Securities by the
Company to the purchasers bear to the gain, if any, realized by all selling
holders participating in such offering or the underwriting discounts and
commissions received by the underwriter, as the case may be. The relative fault
of the Company on the one hand and of the holder of Registrable Securities or
underwriter, as the case may be, on the other shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or omission to state a material fact relates to information
supplied by the Company, by the holder of Registrable Securities or by the
underwriter and the parties' relative intent, knowledge, access to information
supplied by the Company, by the holder of Registrable Securities or by the
underwriter and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission, provided that
the foregoing contribution agreement shall not inure to the benefit of any
indemnified party if indemnification would be unavailable to such indemnified
party by reason of the provisions contained herein, and in no event shall the
obligation of any indemnifying party to contribute under this Section 6.6 exceed
the amount that such indemnifying party would have been obligated to pay by way
of indemnification if the indemnification provided for hereunder had been
available under the circumstances.

                                     - 11 -
<PAGE>

      (ii) The Company and the holders of Registrable Securities agree that it
would not be just and equitable if contribution pursuant to this Section 6.6
were determined by pro rata allocation (even if the holders of Registrable
Securities and any underwriters were treated as one entity for such purpose) or
by any other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph shall
be deemed to include, subject to the limitations set forth herein, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim.

      (iii) Notwithstanding the provisions of this Section 6.6, no holder of
Registrable Securities or underwriter shall be required to contribute any amount
in excess of the amount by which (i) in the case of any such holder, the net
proceeds received by such holder from the sale of Registrable Securities in the
applicable Registration Statement or (ii) in the case of an underwriter, the
total price at which the Registrable Securities purchased by it and distributed
to the public were offered to the public exceeds, in any such case, the amount
of any damages that such holder or underwriter has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the 1933 Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.

                                  ARTICLE VII

                                    RULE 144

7.1. Rule 144. The Company shall use its commercially reasonable efforts to file
in a timely manner the reports required to be filed by the Company under the
1933 Act and the 1934 Act (including but not limited to the reports under
Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c) of
Rule 144 adopted by the SEC under the 1933 Act) and the rules and regulations
adopted by the SEC thereunder (or, if the Company is not required to file such
reports, will, upon the request of any holder of Registrable Securities, make
publicly available other information) and will take such further action as any
holder of Registrable Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell Registrable Securities
without registration under the 1933 Act within the limitation of the exemptions
provided by (a) Rule 144 under the 1933 Act, as such Rule may be amended from
time to time, or (b) any similar rule or regulation hereafter adopted by the
SEC. Upon the request of any holder of Registrable Securities, the Company will
deliver to such holder a written statement as to whether it has complied with
the requirements of this Section 7.1.

                                  ARTICLE VIII

                                 MISCELLANEOUS

8.1. Amendments And Waivers. This Agreement may be amended and the Company may
take any action herein prohibited, or omit to perform any act herein required to
be performed by it, only if the Company shall have obtained the written consent
to such amendment, action or omission to act, of the holder or holders of
fifty-one percent (51%) or more of the sum of the shares of (i) Registrable
Securities issued at such time, plus (ii) Registrable Securities issuable upon
exercise or conversion of the Securities then constituting derivative securities
(if such Securities were not fully exercised or converted in full as of the date
such consent if sought without regard to the 4.9% Limitation, as defined in the
Purchase Agreement). Each holder of any Registrable Securities at the time or
thereafter outstanding shall be bound by any consent authorized by this Section
8.1, whether or not such Registrable Securities shall have been marked to
indicate such consent.

                                     - 12 -
<PAGE>

8.2. Nominees For Beneficial Owners. In the event that any Registrable
Securities are held by a nominee for the beneficial owner thereof, the
beneficial owner thereof shall be treated as the holder of such Registrable
Securities for purposes of any request or other action by any holder or holders
of Registrable Securities pursuant to this Agreement or any determination of any
number of percentage of shares of Registrable Securities held by a holder or
holders of Registrable Securities contemplated by this Agreement. The Company
may require assurances reasonably satisfactory to it of such owner's beneficial
ownership or such Registrable Securities.

8.3. Notices. Except as otherwise provided in this Agreement, all notices,
requests and other communications to any Person provided for hereunder shall be
in writing and shall be given to such Person (a) in the case of a party hereto
other than the Company, addressed to such party in the manner set forth in the
Purchase Agreement or at such other address as such party shall have furnished
to the Company in writing, or (b) in the case of any other holder of Registrable
Securities, at the address that such holder shall have furnished to the Company
in writing, or, until any such other holder so furnishes to the Company an
address, then to and at the address of the last holder of such Registrable
Securities who has furnished an address to the Company, or (c) in the case of
the Company, at the address set forth on the signature page hereto, to the
attention of its President, or at such other address, or to the attention of
such other officer, as the Company shall have furnished to each holder of
Registrable Securities at the time outstanding. Each such notice, request or
other communication shall be effective (i) upon receipt after such communication
is deposited in the mail with first class postage prepaid, addressed as
aforesaid or (ii) if given by any other means (including, without limitation, by
fax or air courier), when delivered at the address specified above, provided
that any such notice, request or communication shall not be effective until
received, and provided, further, that notice by fax shall not be deemed received
unless receipt is acknowledged.

8.4. Assignment. This Agreement shall be binding upon and inure to the benefit
of and be enforceable by the parties hereto. In addition, and whether or not any
express assignment shall have been made, the provisions of this Agreement which
are for the benefit of the parties hereto other than the Company shall also be
for the benefit of and enforceable by any subsequent holder of any Registrable
Securities. Each of the Holders of the Registrable Securities agrees, by
accepting any portion of the Registrable Securities after the date hereof, to
the provisions of this Agreement including, without limitation, appointment of a
representative (the "Investor's Representative") to act on behalf of such Holder
pursuant to the terms hereof which such actions shall be made in the good faith
discretion of the Investor's Representative and be binding on all persons for
all purposes.

8.5. Descriptive Headings. The descriptive headings of the several sections and
paragraphs of this Agreement are inserted for reference only and shall not limit
or otherwise affect the meaning hereof.

8.6. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without giving effect to
applicable principles of conflicts of law.

8.7. Jurisdiction. If any action is brought among the parties with respect to
this Agreement or otherwise, by way of a claim or counterclaim, the parties
agree that in any such action, and on all issues, the parties irrevocably waive
their right to a trial by jury. Exclusive jurisdiction and venue for any such
action shall be the State or Federal Courts serving the City, County and State
of New York. In the event suit or action is brought by any party under this
Agreement to enforce any of its terms, or in any appeal therefrom, it is agreed
that the prevailing party shall be entitled to reasonable attorneys fees to be
fixed by the arbitrator, trial court, and/or appellate court if such party
prevails on substantially all disputed matters.

                                     - 13 -
<PAGE>

8.8. Entire Agreement. This Agreement, together with the Purchase Agreement,
embodies the entire agreement and understanding between the Company and each
other party hereto relating to the subject matter hereof and supercedes all
prior agreements and understandings relating to such subject matter.

8.9. Severability. If any provision of this Agreement, or the application of
such provisions to any Person or circumstance, shall be held invalid, the
remainder of this Agreement, or the application of such provision to Persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.

8.10. Binding Effect. All the terms and provisions of this Agreement whether so
expressed or not, shall be binding upon, inure to the benefit of, and be
enforceable by the parties and their respective administrators, executors, legal
representatives, heirs, successors and assignees.

8.11. Preparation of Agreement. This Agreement shall not be construed more
strongly against any party regardless of who is responsible for its preparation.
The parties acknowledge each contributed and is equally responsible for its
preparation.

8.12. Failure or Indulgence Not Waiver; Remedies Cumulative. No failure or delay
on the part of any party hereto in the exercise of any right hereunder shall
impair such right or be construed to be a waiver of, or acquiescence in, any
breach of any representation, warranty, covenant or agreement herein, nor shall
nay single or partial exercise of any such right preclude other or further
exercise thereof or of any other right. All rights and remedies existing under
this Agreement are cumulative to, and not exclusive of, any rights or remedies
otherwise available.

8.13. Counterparts. This Agreement may be executed in one or more counterparts,
and by the different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original, but all of which taken together
shall constitute one and the same agreement. A facsimile transmission of this
signed Agreement shall be legal and binding on all parties hereto.

                         [SIGNATURES ON FOLLOWING PAGE]

                                     - 14 -
<PAGE>

         IN WITNESS WHEREOF, the Investor and the Company have as of the date
first written above executed this Agreement.

LOUNSBERRY HOLDINGS II, INC.

/s/ James G. Reindl
---------------------------
By:/s/ James G. Reindl
   ------------------------
Title: Chairman
      ---------------------

INVESTOR

BARRON PARTNERS LP
By:  Barron Capital Advisors, LLC, its General Partners

By:/s/ Andrew Barron Worden
   ------------------------
Andrew Barron Worden
President
730 Fifth Avenue, 9th Floor
New York NY 10019

                                     - 15 -

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