Document:

ASSET
      PURCHASE AGREEMENT

     

    dated
      October 19, 2006

     

    by
      and between

     

    CONSOLIDATED
      SMART BROADBAND SYSTEMS, LLC

     

    and

     

    MULTIBAND
      CORPORATION

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ASSET
      PURCHASE AGREEMENT

     

    THIS
      ASSET PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of
      October 19, 2006, by and between Multiband Corporation, a Minnesota corporation
      (“Multiband”), and Rainbow Satellite Group, LLC, a Connecticut limited liability
      company and wholly owned subsidiary of Multiband (“Rainbow” and together with
      Multiband, the “Sellers” and individually, a “Seller”), and Consolidated Smart
      Broadband Systems, LLC, a California limited liability company
      (“Purchaser”).

     

    WHEREAS,
      Sellers provide
      voice, data, and video services, including cable television and Internet
      services, to multiple dwelling unit customers in the United States (the “Private
      Cable Operator Business”).

     

    WHEREAS,
      Sellers wish to sell to Purchaser, and Purchaser wishes to buy from Sellers,
      certain assets used by Sellers in the conduct of each Seller’s Private Cable
      Operator Business in California (collectively, the “Business”) on the terms and
      for the consideration hereinafter provided.

     

    NOW
      THEREFORE, in consideration of the respective representations, warranties,
      covenants and agreements contained herein, and subject to the terms and
      conditions set forth herein, the parties hereto agree as follows:

     

    ARTICLE
      1

    DEFINITIONS

     

    1.1  Specific
      Definitions.As
      used
      in this Agreement, the following terms shall have the meanings set forth or
      referenced below:

     

    (a)  “Affiliate”
of
      a
      specified Person means a Person that directly or indirectly through one or
      more
      intermediaries, controls, or is controlled by, or is under common control with,
      the person specified. “Control” shall mean ownership of more than 50% of the
      shares of stock entitled to vote for the election of directors in the case
      of a
      corporation, and more than 50% of the voting power in the case of a business
      entity other than a corporation.

     

    (b)  “Annualized
      Average Normalized PPC”
means,
      with respect to each ROE Property, the average of the prepaid programming
      commissions normalized to reflect a prepaid programming commission rate of
      $175.00 per DTH Subscriber activation for the eight month period ending on
      August 31, 2006 with respect to the calculation of the Purchase Price,
      annualized to convert the normalized 8-month prepaid programming commissions
      to
      an annual amount, and (ii) for the six month period ending on November 30,
      2007
      with respect to the calculation of the Earnout Amount, annualized to convert
      the
      normalized 6-month prepaid programming commissions to an annual amount.

     

    (c)  “Assets”
means
      (i) all of the ROE Agreements, (ii) all inventory and equipment owned by Sellers
      related to the Business and the Assets, including, without limitation, all
      the
      equipment listed on Schedule
      1.1(b),
      the
      distribution Systems, including, SMATV head-end distribution systems, L-Band
      distribution systems and master antenna television distribution systems used
      for
      central distribution of the signals to the Sellers’ existing subscribers, all
      customer premise equipment and System Equipment and all uninterrupted power
      supply devices and all inventory of or relating to the Business, (iii) all
      of
      the RandM Assets, (iv) all fixed assets, including, without limitation, all
      tools, supplies and the two (2) Astro Vans leased by Sellers and the 2 Ford
      Vans
      owned by Sellers as set forth on Schedule
      3.6,
      but
      specifically excluding all furniture, phone and computer equipment, (v) all
      goodwill associated with the Business and relating to any of the assets
      described in this Section
      1.1(b),
      (vi)
      all accounts receivable distributed pursuant to Section
      5.7 below,
      including, without limitation, Bulk Service fees, SMATV Non-Bulk Service fees,
      receiver fees and other amounts with respect to any ROE Agreement for any ROE
      Property identified on Schedule
      3.8(a) and
      any
      residuals, prepaid programming commissions or other amounts due to Sellers
      from
      DirecTV and outstanding as of the Closing Date, (vii) all books, records
      (including, without limitation, customer records as otherwise set forth in
      this
      Agreement) and data relating to any Asset, (viii) all subscriber agreements
      between each Seller and a customers at each ROE Property and (ix) any permits
      and licenses used or necessary for the Business. 

     

    
      
        
        

      

      
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    (d)  “Assumed
      Liabilities”
means
      the liabilities described in Section
      2.2(a).

     

    (e)  “Authorizations”
has
      the
      meaning set forth in Section
      3.11.

     

    (f)  “Business”
means
      the Private Cable Operator Business of Sellers conducted by Sellers in
      California prior to the Closing.

     

    (g)  “Bulk
      Digital Service”
means
      digital television service delivered to all of the units at an ROE Property
      for
      a prescribed monthly fee.

     

    (h)  “Bulk
      EBU Subscribers”
means,
      as
      of the
      month ended August 31, 2006 with respect to the calculation of the Purchase
      Price and as of the month ended November 30, 2007 with respect to the
      calculation of the Earnout Amount,
      the
      number of subscribers at an ROE Property that has Bulk Service computed by
      taking (A) the total number of units at an ROE Property times (B) fifty percent
      (50%).

     

    (i)  “Bulk
      Service”
means
      Bulk Digital Service or Bulk SMATV Service.

     

    (j)  “Bulk
      SMATV Service”
means
      television service delivered through a SMATV System to all of the units at
      an
      ROE Property for a prescribed monthly fee.

     

    (k)  “COBRA”
has
      the
      meaning set forth in Section
      3.35(c).

     

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

     

    (m)  “Closing”
and
      “Closing
      Date”
have
      the meanings set forth in Section
      2.7.
      

     

    (n)  “Closing
      Date Direct Costs”
means
      the direct costs of Seller as of the Closing Date as set forth on Schedule
      3.5(c).

     

    
      
        
        

      

      
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    (o)  “Closing
      Date Free Cash Flow”
means
      the free cash flow of Purchaser calculated for each year in the number of Whole
      Years in the Weighted Average Remaining ROE Agreement Term as of the Closing
      Date and calculated by taking Closing Date Gross Revenue in the amount set
      forth
      on Schedule
      3.5(d)
      for the
      first year of the total number of
      Whole
      Years in the Weighted
      Average Remaining ROE Agreement Term as of the Closing
      Date,
      less
      Closing Date Direct Costs in the amount set forth on Schedule
      3.5(c)
      for the
      first year in the Closing Date Free Cash Flow calculation, less Closing Date
      Operating Expenses for the first year in the Closing Date Free Cash Flow
      Calculation, less Maintenance CapEx, and then applying the Closing Date Free
      Cash Flow Adjustments to calculate the Closing Date Free Cash Flow for
      each
      of the subsequent Whole Years remaining in the Weighted
      Average Remaining ROE Agreement Term as of the Closing
      Date, as
      set forth in Schedule
      2.3(a).
      The
      calculation of the Closing Date Free Cash Flow shall not include any amounts
      with respect to the RandM Assets.

     

    (p)  “Closing
      Date Free Cash Flow Adjustments”
means
      the Closing Date Free Cash Flow of Purchaser calculated as of the Closing Date
      for the number of Whole Years in the Weighted Average Remaining ROE Agreement
      Term as of the Closing Date (i) based on the number of Subscribers as of the
      Closing Date for the first year increased by an annual twenty percent (20%)
      increase in the number of DTH Subscribers as of the Closing Date for each
      subsequent Whole Year up to a maximum of 8,000 DTH Subscribers and is fixed
      at
      8,000 DTH Subscribers for each remaining Whole Year thereafter, (ii) assuming
      the average term of a new Subscriber for the first year of subscription at
      6
      months and for each Whole Year thereafter, at 12 months, (iii) assuming the
      gross revenue for each new Subscriber is $35 for each month of subscription,
      (iv) assuming that the direct cost for each new Subscriber is $5.00 for each
      month of subscription; (v) assuming call center and billing costs at the rate
      of
      $3.00 per month for each Subscriber, (vi) assuming fixed on-site marketing
      costs
      at the rate of $60,000.00 for each year in the calculation, (vii) assuming
      fixed
      office, telephone, postage and similar costs at the rate of $18,000.00 for
      each
      year in the calculation, (viii) assuming that each of payroll and related
      benefit expenses and vehicle and vehicle-related expenses for the first year
      increase at the rate of 2.5% for each subsequent year in the calculation, and
      (xiv) assuming that Maintenance CapEx is fixed in the amount of $100,000.00
      for
      each year in the calculation.

     

    (q)  “Closing
      Date Gross Margin”
means
      the gross margin of Seller as of the Closing Date as set forth on Schedule
      3.5(d).

     

    (r)  “Closing
      Date Gross Revenue”
means
      the gross revenue as of the Closing Date set forth on Schedule
      3.5(b).

     

    (s)  “Closing
      Date Operating Expenses”
means
      the incremental variable expenses incurred to operate the Assets and includes
      the following as of the Closing Date: (i) call center and billing expenses
      at an
      assumed monthly rate of three dollars ($3.00) per Subscriber as of the Closing
      Date multiplied by twelve (12) months, (ii) onsite marketing expenses estimated
      at an annual cost of $60,000.00, (iii) office, telephone, postage and similar
      expenses estimated at an annual cost of $18,000.00, (iv) payroll and related
      benefit expenses in the amount of $571,356.00 for the first year, and (v)
      vehicle and vehicle-related expenses in the amount of $122,892.00 for the first
      year.

     

    (t)  “Closing
      Extension Option”
has
      the
      meaning sets forth in Section
      2.7.

     

    
      
        
        

      

      
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    (u)  “Confidential
      Information”
      includes all information disclosed by any party to this Agreement to another
      party, including, without limitation, the existence, terms and conditions of
      this Agreement, any information about the ROE Properties or ROE Agreements,
      the
      existence and terms of any arrangements between Purchaser and its suppliers
      or
      Purchaser and Sellers, and any information in Sellers’ possession with respect
      to the Assets. 

     

    (v)  “Consents”
has
      the
      meaning set forth in Section
      3.19.

     

    (w)  “Contract”
means
      any contract, purchase or sale order, lease, license, commitment and other
      agreement, whether written or oral, relating to the Business to which either
      Seller is a party or an assignee or other beneficiary thereof, including,
      without limitation, the ROE Agreements.

     

    (x)  “DirecTV”
means
      DirecTV, Inc., a California corporation.

     

    (y)  “DirecTV
      Residual Report”
means
      that certain monthly DirecTV Residual Report, which sets forth the number and
      type of Subscribers on which DirecTV pays commissions to Sellers for the
      particular month indicated in the report.

     

    (z)  “Disclosure
      Schedules”
means
      all of the Schedules delivered by Sellers to Purchaser under this
      Agreement.

     

    (aa)  “DTH
      Subscriber”
means
      a
      direct-to-home subscriber at an ROE Property listed on the
      DirecTV Residual Report with a paid residual to the Sellers per the DirecTV
      Residual Report for the month ended June 30, 2006 with respect to the
      calculation of the Purchase Price and per the DirecTV Residual Report for the
      month ended November 30, 2007 with respect to the calculation of the Earnout
      Amount.

     

    (bb)  “Earnout
      Amount”
means
      the greater of (i) four hundred thousand dollars ($400,000.00) or (ii) the
      amount derived from the Earnout Date Free Cash Flow over the Weighted
      Average Remaining ROE Agreement Term as
      of the
      Earnout Date, which results in the Purchaser Minimum IRR as of the Earnout
      Date,
      minus the cash portion of the Purchase Price paid on the Closing
      Date.

     

    (cc)  “Earnout
      Date”
means
      the first anniversary date of the Closing or nine (9) months after the Closing
      Date if the Closing Extension Option is exercised.

     

    (dd)  “Earnout
      Date Direct Costs”
means,
      with respect to all ROE Properties other than the RandM Assets, the sum of
      each
      of the following paid by the Sellers for
      the
      month ended November 30, 2007,
      annualized to convert such 1-month costs into an annual cost: (i) all Owner
      Commissions,
      plus
      (ii) the fees for Bulk Digital Service paid to DIRECTV, plus (iii) the fees
      for
      Bulk SMATV Service paid to DIRECTV, plus (iv) the transport fees paid to 4COM,
      plus (v) the fees paid for SMATV Non-Bulk Service to DIRECTV.

     

    (ee)  “Earnout
      Date Free Cash Flow”
means
      the free cash flow of Purchaser calculated for each year in the number of Whole
      Years in the Weighted Average Remaining ROE Agreement Term as of the Earnout
      Date and calculated by taking the Earnout Date Gross Revenue for the first
      year
      of the total number of Whole Years remaining in the Weighted Average Remaining
      ROE Agreement Term as of the Earnout Date, less Earnout Date Direct Costs for
      the first year in the Earnout Date Free Cash Flow calculation, less Earnout
      Date
      Operating Expenses for the first year in the Earnout Date Free Cash Flow
      Calculation, less Maintenance CapEx, and then applying the Earnout Date Free
      Cash Flow Adjustments to calculate the Earnout Date Free Cash Flow for each
      of
      the subsequent Whole Years remaining in the Weighted Average Remaining ROE
      Agreement Term as of the Earnout Date. For purposes of this definition, Earnout
      Date Free Cash Flow will include the annualized Internet Gross Margin based
      upon
      the Purchaser’s actual Internet Gross Margin for the three (3)-month period
      ended November 30, 2007. The calculation of the Earnout Date Free Cash Flow
      shall not include any amounts with respect to the RandM Assets.

     

    
      
        
        

      

      
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    (ff)  “Earnout
      Date Free Cash Flow Adjustments”
means
      the Earnout Date Free Cash Flow of Purchaser calculated as of the Earnout Date
      for the number of Whole Years in the Weighted Average Remaining ROE Agreement
      Term as of the Earnout Date (i) based on the number of Subscribers as of the
      Earnout Date for the first year increased by an annual twenty percent (20%)
      increase in the number of DTH Subscribers as of the Earnout Date for each
      subsequent year up to a maximum of 8,000 DTH Subscribers and is fixed at 8,000
      DTH Subscribers for each Whole Year thereafter, (ii) assuming the average term
      of a new Subscriber for the first year of subscription at 6 months and for
      each
      Whole Year thereafter at 12 months, (iii) assuming the gross revenue for each
      new Subscriber is $35 for each month of subscription, (iv) assuming that the
      direct cost for each new Subscriber is $5.00 for each month of subscription;
      (v)
      assuming call center and billing costs at the rate of $3.00 per month for each
      Subscriber, (vi) assuming fixed on-site marketing costs at the rate of
      $60,000.00 for each year in the calculation, (vii) assuming fixed office,
      telephone, postage and similar costs at the rate of $18,000.00 for each year
      in
      the calculation, (viii) assuming that each of payroll and related benefit
      expenses and vehicle and vehicle-related expenses for the first year increase
      at
      the rate of 2.5% for each subsequent year in the calculation, and (xiv) assuming
      that Maintenance CapEx is fixed in the amount of $100,000.00 for each year
      in
      the calculation. 

     

    (gg)  “Earnout
      Date Gross Revenue”
means,
      with respect to all ROE Properties (other than the RandM Assets), the sum of
      (i)
      the DirecTV residuals paid to Sellers pursuant to the DTV Residual Report for
      the month ended November 30, 2007, annualized to convert the 1-month total
      to an
      annual total, plus (ii) the DIRECTV annualized Average Normalized PPC, plus
      (iii) the normalized receiver fees at the normalized monthly rate of $6.99
      per
      DTH Subscriber, calculated for a 12-month period, plus (iv) the fees for Bulk
      Digital Service billed to such ROE Property for the month ended November 30,
      2007, annualized to convert the 1-month fees to an annual total, plus (v) the
      fees for Bulk SMATV Service billed to such ROE Property for the month ended
      November 30, 2007, annualized to convert the 1-month fees to an annual total,
      plus (vi) the fees for SMATV Non-Bulk Service billed to each subscriber at
      such
      ROE Property for the month ended November 30, 2007, annualized to convert the
      1-month fees to an annual total. 

     

    (hh)  “Earnout
      Date Operating Expenses”
means
      the incremental variable expenses incurred by Purchaser to operate the Assets
      and includes the following as of the Earnout Date: (i) call center and billing
      expenses at an assumed monthly rate of three dollars ($3.00) per Subscriber
      as
      of the Earnout Date multiplied by twelve (12) months, (ii) onsite marketing
      expenses estimated at an annual cost of $60,000.00, (iii) office, telephone,
      postage and similar expenses estimated at an annual cost of $18,000.00, (iv)
      payroll and related benefit expenses in the amount of $585,640.00 for the first
      year, and (v) vehicle and vehicle-related expenses in the amount of $125,965.00
      for the first year.

     

    
      
        
        

      

      
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    (ii)  “Employee
      Plans”
has
      the
      meaning set forth in Section
      3.35(a).

     

    (jj)  “Environmental
      Laws or Regulations”
means
      and includes any one or more of the following: the Comprehensive Environmental
      Response Compensation and Liability Act (“CERCLA”), as amended by the Superfund
      Amendments and Reauthorization Act of 1986 (“SARA”), 42 U.S.C. § 9601 et
      seq.; the Federal Resource Conservation and Recovery Act of 1976 (“RCRA”), 42
      U.S.C. § 6921 et seq.; the Clean Water Act, 33 U.S.C. § 1321 et seq.;
      the Clean Air Act, 42 U.S.C. § 7401 et seq.; any other federal, state,
      county, municipal, local or other statute, law, ordinance or regulation that
      relates to or deals with Hazardous Substances, human health or the environment;
      and all regulations and regulatory policies promulgated by a regulatory body
      pursuant to any of the foregoing statutes, laws, regulations or
      ordinances.

     

    (kk)  “ERISA”
means
      the Employee Retirement Income Security Act of 1974.

     

    (ll)  “ERISA
      Affiliate”
has
      the
      meaning set forth in Section
      3.35(a).

     

    (mm)  “Event”
means
      any event, act, omission, circumstance, occurrence, condition or
      situation.

     

    (nn)  “FCC”means
      the
      Federal Communications Commission.

     

    (oo)  “GAAP”
means
      generally accepted accounting principles for financial reporting in the United
      States, applied on a basis consistent with the basis on which the financial
      statements referred to in Section
      3.5
      were
      prepared.

     

    (pp)  “Gross
      Margin”
means,
      with respect to each ROE Property, the difference between the Gross Revenue
      and
      the Total Direct Cost for such ROE Property.

     

    (qq)  “Gross
      Margin Percentages”
means
      twenty-six percent (26%) for Multiband and seventy-four percent (74%) for
      Rainbow.

     

    (rr)  “Hazardous
      Substance”
means
      asbestos, urea formaldehyde, polychlorinated biphenyls, nuclear fuel or
      materials, chemical waste, radioactive materials, explosives, known carcinogens,
      petroleum products, pesticides, fertilizers, or any other substance that is
      dangerous, toxic, or hazardous, or that is a pollutant, contaminant, chemical,
      material or substance defined as hazardous or as a pollutant or contaminant
      in,
      or the use, transportation, storage, release or disposal of which is regulated
      by, any Environmental Laws or Regulations.

     

    (ss)  “Initial
      Closing”
and
      “Initial
      Closing Date”
has
      the
      meaning set forth in Section
      2.7.

     

    (tt)  “IRS”
means
      the United States Internal Revenue Service.

     

    (uu)  “Knowledge
      of Sellers”
means
      actual knowledge of each of the officers and employees of the Sellers, or the
      knowledge that any of such persons would reasonably be expected to have assuming
      reasonable inquiry of any facts or circumstances actually known to and
      recognized by such person to create significant doubt concerning the accuracy
      of
      any representation, warranty or statement without regard to such “knowledge”
qualifier.

     

    
      
        
        

      

      
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    (vv)  “Legal
      Requirement”
means
      any federal, state, local, municipal, foreign, or other constitution, law,
      ordinance, principle of common law, code, regulation, statute or
      treaty.

     

    (ww)  Liens”
means
      liens, mortgages, charges, security interests, pledges, encumbrances,
      assessments, obligations, restrictions or other third-party claims of any nature
      other than statutory liens for Taxes and other governmental charges and
      assessments which are not yet due and payable as of the Closing.

     

    (xx)  “Maintenance
      CapEx”
means
      $100,000.00 per year representing the estimated fixed cost to repair or replace
      any of the Systems or System Equipment included in the Assets, including,
      without limitation, costs to repair or replace wiring and parts and the related
      labor costs to repair or replace such wiring and parts.

     

    (yy)  “Material
      Adverse Effect”
means
      an effect that, individually or in the aggregate with other related effects,
      is
      or could reasonably be expected to be materially adverse to the business,
      results of operation or condition (financial or otherwise) of the Assets or
      the
      Business, considered as a whole.

     

    (zz)  “Missing
      ROE Agreement”
has
      the
      meaning set forth in Section
      3.8.

     

    (aaa)  “Multiband
      Assets”
means
      all of the Assets that are owned or held by Multiband, including, without
      limitation, the RandM Assets.

     

    (bbb)  “Multiband
      ROE Agreements”
means
      each of the access and use agreements set forth on Schedule
      3.8(a) hereto
      identified as originating from “MBND” or “Dinamo” under the column entitled
“Origin”. 

     

    (ccc)  “Multiemployer
      Plan”
      has the
      meaning set forth in Section
      3.35(a).

     

    (ddd)  “New
      ROEs”
has
      the
      meaning set forth in Section
      6.6
      of this
      Agreement.

     

    (eee)  “Owner”
means
      the owner of any ROE Property.

     

    (fff)  “Owner
      Advances”
means
      any lump sum advance payments made to any Owner with respect to any ROE
      Agreement.

     

    (ggg)  “Owner
      Commissions”
means
      any commissions, owner participation fees, Owner Advances, revenue sharing
      arrangements, access fees, licensing fees, bonus payments, or other similar
      fees
      or payments due to any Owner or any other Person with respect to any ROE
      Agreement or the transactions contemplated in this Agreement. 

     

    (hhh)  “Person”
means
      an individual, partnership, corporation, business trust, limited liability
      company, limited liability partnership, join stock company, trust,
      unincorporated association, joint venture or other entity or a governmental
      body

     

    
      
        
        

      

      
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    (iii)  “Pre-Closing
      Owner Commissions”
means
      all Owner Commissions that are required to have been paid by Sellers on or
      prior
      to the Closing Date.

     

    (jjj)  “Purchase
      Price”
has
      the
      meaning set forth in Section
      2.3.

     

    (kkk)  “Purchaser
      Minimum IRR”
means
      (i) as of the Closing, an internal rate of return to Purchaser of twenty percent
      (20%) and (ii) as of the Earnout Date, an internal rate of return to Purchaser
      of twenty-five percent (25%). For purposes of the calculation of the Earnout
      Amount, the investment amount used in calculating the Purchaser Minimum IRR
      as
      of the Earnout Date will include the Purchase Price (but excluding the RandM
      Assets Purchase Price and the Assumed Liabilities) plus the Earnout Amount.
      

     

    (lll)  “Rainbow
      Assets”
means
      all of the Assets that are owned or held by Rainbow.

     

    (mmm)  “Rainbow
      ROE Agreements”
means
      each of the California access and use agreements set forth on Schedule
      3.8(a)
      hereto
      identified as originating from “RAIN” under the column entitled
“Origin”.

     

    (nnn)  “RandM
      Assets”
means
      all of the Assets that are owned or held by Multiband and which were acquired
      by
      Multiband from Rand’M, a California corporation, pursuant to that certain Cable
      Systems Acquisition Agreement entered into effective September 13, 2006.

     

    (ooo)  “RandM
      Assets Purchase Price”
means
      $200,000.00.

     

    (ppp)  “RandM
      ROE Agreements”
means
      the ROE Agreements included in the RandM Assets.

     

    (qqq)  “Retained
      Liabilities”
has
      the
      meaning set forth in Section
      2.2.

     

    (rrr)  “ROE
      Agreement”
means
      each of the access and use agreements or service and installation agreements
      set
      forth on Schedule
      3.8(a)
      hereto
      which includes all the Multiband ROE Agreements and the Rainbow ROE Agreements,
      and each RandM ROE Agreement and each Missing ROE Agreement.

     

    (sss)  “ROE
      Property”
means
      each property subject to an ROE Agreement.

     

    (ttt)  “Sales
      Commission”
means
      with respect to each New ROE, the amount of commission payable by Sellers to
      the
      respective marketing representatives of Purchaser calculated by multiplying
      (i)
      two dollars and fifty cents ($2.50) times (ii) the number of units at each
      ROE
      Property covered by a New ROE times (iii) the number of years in the term of
      such New ROE, including any renewal
      terms under the sole control of either of the Sellers on or prior to the Closing
      Date, up to a maximum of ten (10) years in the aggregate, provided, however,
      that any such New ROE has a minimum initial term of five (5) years.

     

    (uuu)  “Schedule”
means
      a
      part of the Disclosure Schedules unless expressly identified as a Purchaser’s
      Schedule.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    (vvv)  “Schedule
      2.4 Payment”
has
      the
      meaning set forth in Section
      2.4.

     

    (www)  “SMATV
      Non-Bulk Service”
means
      SMATV services delivered to individual residents at an ROE Property using a
      System that encompasses a headend installed at such ROE Property and which
      is
      not a form of Bulk Service. 

     

    (xxx)  “SMATV
      Non-Bulk Subscriber”
means
      a
      subscriber at an ROE Property that was billed for SMATV Non-Bulk Service as
      of
      August 31, 2006 for the calculation of the Purchaser Price and as of November
      30, 2007 for the calculation of the Earnout Amount. 

     

    (yyy)  “Subscriber”
means
      any DTH Subscriber, SMATV Non-Bulk Subscriber or Bulk EBS
      Subscriber. 

     

    (zzz)  “System”
means
      the cable, direct satellite system, SMATV system, mater antenna television
      or
      other television system built, acquired and/or operated by Sellers at the ROE
      Property, including all System Equipment and any and all other related wiring
      installed at the ROE Property as of the Closing Date in connection with the
      provision of cable, direct satellite television services and SMATV at the ROE
      Property.

     

    (aaaa)  “System
      Equipment”
means
      all equipment used in, or necessary for, the safe and proper operation of the
      System, including, but not limited to, satellite dishes, antennas, parabolic
      receiver antennas, leads, cables,
      conduit, terminals, location markers, amplifiers, down converters, wiring,
      descrambling equipment, head end equipment (including all racks, security and
      air conditioning units, power inserters, modulators, receivers and access
      cards), pedestals, junction boxes, vaults, splitters, interdiction devices,
      power supplies, receivers,
      destackers, amplifiers, decoders and other electronic devices used to distribute
      broadband communication signals. 

     

    (bbbb)  “Taxes”
means
      all taxes, additions to tax, penalties, interest, fines, duties, withholdings,
      assessments, and charges assessed or imposed by any governmental authority,
      including but not limited to all federal, state, county, local and foreign
      income, profits, gross receipts, import, ad valorem, real and personal property,
      franchise, license, sales, use, value added, stamp, transfer, withholding,
      payroll, employment, excise, custom, duty, and any other taxes, obligations
      and
      assessments of any kind whatsoever; the foregoing shall include, but not be
      limited to, any liability arising as a result of being (or ceasing to be) a
      member of any affiliated, consolidated, combined, or unitary group as well
      as
      any liability under any tax allocation, tax sharing, tax indemnity or similar
      agreement.

     

    (cccc)  “WARN
      Act”
has
      the
      meaning set forth in Section
      3.35(c).

     

    (dddd)  “Weighted
      Average Remaining ROE Agreement Term”
means
      as of any date, the average remaining term of the ROE Agreements including
      any
      automatic renewal terms under the sole control of either of the Sellers on
      or
      prior to the Closing Date, or the sole control of Purchaser after the Closing
      Date until the Earnout Date, weighted based on the applicable Gross Margin
      for
      such date. For purposes of calculating the Weighted Average Remaining ROE
      Agreement Term as of the date of this Agreement, any ROE Agreement that is
      expired is deemed to have a remaining term (including automatic renewals) of
      one
      (1) month and the remaining term (including automatic renewals) of all other
      ROE
      Agreements is based on the actual term (including automatic renewals) remaining
      as of such date. For purposes of calculating the Weighted Average Remaining
      ROE
      Agreement Term as of the Closing Date and as of the Earnout Date, any ROE
      Agreement that is expired or has a remaining term (including any automatic
      renewals) of less than twelve (12) months will be deemed to have a remaining
      term (including automatic renewals) of twelve (12) months and the remaining
      term
      (including automatic renewals) of all other ROE Agreements will be based on
      the
      actual term (including automatic renewals) remaining as of such date.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    (eeee)  “Whole
      Years”
means
      at any date, the number calculated by dividing the Weighted Average Remaining
      ROE Agreement Term at such date, by 12 and rounding the quotient up to the
      nearest whole number for each fractional year that is greater than or equal
      to
      one-half (0.50).

     

    1.2  Other
      Terms.
      Other
      terms may be defined elsewhere in the text of this Agreement and shall have
      the
      meaning indicated throughout this Agreement.

     

    1.3  Other
      Definitional Provisions.

     

    (i)  The
      words
“hereof,” “herein,” and “hereunder” and words of similar import, when used in
      this Agreement shall refer to this Agreement as a whole and not to any
      particular provisions of this Agreement.

     

    (ii)  The
      terms
      defined in the singular shall have a comparable meaning when used in the plural,
      and vice versa.

     

    (iii)  References
      to an “Exhibit”, “Annex” or to a “Schedule” are, unless otherwise specified, to
      one of the Exhibits, Annexes or Schedules attached to or referenced in this
      Agreement, and references to an “Article” or a “Section” are, unless otherwise
      specified, to one of the Articles or Sections of this Agreement.

     

    (iv)  The
      term
“Dollars” or “$” shall refer to the currency of the United States of
      America.

     

    (v)  All
      references to time shall refer to Los Angeles, California time.

     

    (vi)  The
      term
“including” is by way of example and not limitation, whether or not followed by
      the words “without limitation” or any similar phrase.

     

    ARTICLE
      2

    PURCHASE
      AND SALE OF ASSETS

     

    2.1  Purchased
      Assets.
      Upon
      the terms and subject to the conditions set forth in this Agreement, effective
      as of the Closing, (a) Multiband hereby sells, transfers, assigns and conveys
      to
      Purchaser, and Purchaser hereby purchases, the Multiband Assets free and clear
      of all Liens and encumbrances and (b) Rainbow hereby sells, transfers, assigns
      and conveys to Purchaser, and Purchaser hereby purchases, the Rainbow Assets
      free and clear of all Liens and encumbrances.
      The
      Multiband Assets and the Rainbow Assets are intended to include all the
      Assets.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

     

    2.2  Assumed
      Liabilities; Retained Liabilities.
      Purchaser
      shall assume no liabilities of Sellers other than the post-closing obligations
      under the ROE Agreements following the Closing,
      which
      liabilities are expressly assigned to and assumed by Purchaser hereunder (the
      “Assumed Liabilities”). It is expressly agreed and understood that, except for
      the Assumed Liabilities, Purchaser does not assume any obligations or
      liabilities of Sellers, including, without limitation, any liabilities arising
      out of or relating in any way to the build-out or operation of a System or
      the
      System Equipment prior to Closing at each ROE Property by Sellers or others
      or
      with respect to any Pre-Closing Owner Commissions (the “Retained Liabilities”).

     

    2.3  Purchase
      Price; Payment.
      The
      total consideration for the Assets (the “Purchase Price”) shall be equal to (i)
      the RandM Assets Purchase Price, plus (ii) three million, four hundred and
      thirty thousand dollars ($3,430,000.00) for the other Multiband Assets and
      the
      Rainbow Assets, which portion of the purchase price is calculated based on
      the
      Closing Date Free Cash Flow and the Purchaser’s Minimum IRR and the assumption
      that at the Closing, the Closing Date Weighted Average Remaining ROE Agreement
      Term will be at least eighty-four (84) months, plus (iii) the Assumed
      Liabilities; provided, however, that the portion of the Purchase Price described
      in subsection (ii) above shall be adjusted up or down as set forth on
Schedule
      2.3(a) to
      reflect the actual Closing Date Weighted Average Remaining ROE Agreement Term.
      Schedule
      2.3(b)
      sets
      forth the calculation of the Purchase Price excluding the Assumed Liabilities
      and the RandM Assets Purchase Price and details the calculations for Free Cash
      Flow and the Purchaser’s Minimum IRR. The cash portion of the Purchase Price
      attributable to the Schedule 2.4 ROE Assets will be paid by Purchaser to Rainbow
      at the Initial Closing as described in Section
      2.4
      below.
      The balance of the Purchase Price shall be paid to the Sellers at the Closing
      as
      follows: (i) eighty percent (80%) of the cash portion of the Purchase Price
      will
      be paid to Sellers based on their respective Gross Margin Percentages and (ii)
      twenty percent (20%) of the cash portion of the Purchase Price shall be held
      by
      Purchaser as an indemnity holdback to cover claims by Purchaser under
Article
      9
      hereof
      (the “Indemnity Holdback Amount”). The Holdback shall be released to Sellers
      pursuant to the terms of Section
      2.6
      below.

     

    2.4  Initial
      Closing.
      At
      the
      Initial Closing, Purchaser shall pay to Rainbow three hundred and eighty-six
      thousand dollars ($386,000.00) (the “Schedule 2.4 Payment”) with respect to the
      ROE Agreements and the related Assets for the five (5) ROE Properties identified
      on Schedule
      2.4 hereto
      (the “Schedule 2.4 ROE Assets”) if (a) such ROE Agreement provides Rainbow with
      the exclusive right to provide and market its private cable operator services
      at
      each such property, (b) the Weighted Average Remaining ROE Agreement Term of
      the
      ROE Agreements with respect to each of the Schedule 2.4 ROE Assets including
      any
      automatic renewal terms under the sole control of either of the Sellers on
      or
      prior to the Closing Date is at least sixty (60) months, and (c) the aggregate
      Gross Margin with respect to the ROE Agreements included in the Schedule 2.4
      ROE
      Assets is at least fifteen thousand dollars ($15,000.00) per month. The Schedule
      2.4 Payment shall be considered complete payment to Rainbow for the Assets
      relating to the Schedule 2.4 ROE Assets such that title to all such Assets
      will
      transfer to Purchaser as of the Schedule 2.4 Assets Effective Date. At the
      Closing Date, the Schedule 2.4 Payment shall be deducted from the Purchase
      Price
      due to Rainbow with respect to the balance of the Assets at the Closing Date
      and
      the Schedule 2.4 Payment shall be included as part of the Purchase Price with
      respect to calculation of the Earnout Amount and the Assets shall be included
      with all the other Assets for all other purposes under this
      Agreement.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    2.5  Earnout.
      In
      addition to the Purchase Price, Sellers shall be entitled to the Earnout Amount
      on the Earnout Date. The Earnout Amount shall be paid to Sellers based on their
      respective Gross Margin Percentages.

     

    2.6  Indemnity
      Holdback Amount.
      The
      Indemnity Holdback Amount shall be released as set forth below to Sellers in
      accordance with the Gross Margin Percentage: (a) to the extent that on the
      third
      (3rd)
      month
      anniversary of the Closing Date any claims by Purchaser under Article
      9 hereof
      are less than seventeen and a half percent (17.5%) of the cash portion of the
      Purchase Price paid by Purchaser as of the Closing Date, then two and a half
      percent (2.5%) of the Indemnity Holdback Amount shall be released to Sellers
      on
      such third (3rd)
      month
      anniversary; (b) to the extent that on the sixth (6th)
      month
      anniversary of the Closing Date any claims by Purchaser under Article
      9 hereof
      are less than fifteen percent (15.0%) of the cash portion of the Purchase Price
      paid by Purchaser as of the Closing Date, then two and a half percent (2.5%)
      of
      the Indemnity Holdback Amount shall be released to Sellers on such sixth
      (6th)
      month
      anniversary; (c) to the extent that on the nine (9) month anniversary of the
      Closing Date any claims by Purchaser under Article
      9 hereof
      are less than twelve and a half percent (12.5%) of the cash portion of the
      Purchase Price paid by Purchaser as of the Closing Date, then two and a half
      percent (2.5%) of the Indemnity Holdback Amount shall be released to Sellers
      on
      such nine (9) month anniversary; and (d) to the extent that on the first
      (1st)
      year
      anniversary of the Closing Date, there are no claims by Purchaser under
Article
      9 hereof
      or
      such claims are less than twelve and a half percent (12.5%) of the cash portion
      of the Purchase Price paid by Purchaser as of the Closing Date, then the total
      remaining balance of the Indemnity Holdback Amount shall be released to Sellers
      on such first (1st)
      year
      anniversary of the Closing Date; provided, however, that if any claim by
      Purchaser under Article
      9
      is
      pending dispute as of the time of any release of any portion of the Indemnity
      Holdback Amount, then, unless the balance of the Indemnity Holdback Amount
      at
      such time (excluding the amount required to be distributed at such time) is
      sufficient to cover the amount of such disputed claim, then an amount equal
      to
      such claim shall continue to be held by Purchaser until such time as the
      disputed claim is finally resolved among the parties and such amount distributed
      according to such resolution or, as necessary, retained to insure that the
      appropriate Indemnity Holdback Amount at such time continues to be held by
      Purchaser.

     

    2.7  Initial
      Closing Date; Closing Date.
      

     

    (a)  Initial
      Closing.
      The
      consummation of the purchase and sale of the Schedule 2.4 ROE Assets provided
      for in Section
      2.4
      hereof
      (the “Initial Closing”) shall take place at 10:00 a.m. (Pacific Standard time)
      on October 19, 2006, or at such other date and time as is mutually agreed to
      by
      the parties (the “Initial Closing Date”), but shall be deemed effective as of
      12:01 a.m. (Pacific Standard time) on September 29, 2006 (the “Schedule 2.4
      Assets Effective Date”). The Initial Closing shall take place by delivery to
      each of Purchaser’s and Multiband’s principal office via facsimile transmission
      or email transmission in PDF file format (with originals sent via overnight
      courier service) of the signed Agreement and delivery of (a) the Initial Closing
      Purchase Price to be made in accordance with Section
      2.4,
      (b) a
      fully executed assignment for each ROE Agreement listed on Schedule 2.4, other
      than with respect to the ROE Agreement for the ROE Property known as the
      Promenade which ROE Agreement was executed in the name of Purchaser and
      therefore does not require further assignment to Purchaser, (c) a fully executed
      bill of sale with respect to the Schedule 2.4 ROE Assets, (d) a fully executed
      Secretary’s Certificate of Rainbow providing the information required by
Section
      6.28
      with
      respect to the sale of the Schedule 2.4 ROE Assets, and (e) evidence of
      compliance with the actions required by Sections
      6.23
      (Transfer of Chain Numbers), Section
      6.24
      (Transfer of Accounts) and Section
      6.25
      (DirecTV’s Waiver of Right of First Refusal) with respect to the Schedule 2.4
      ROE Assets, or at such other place or in such other manner as the parties hereto
      may agree. In addition, (x) execution of this Agreement is evidence that (1)
      none of the conditions contemplated in Section
      6.3 (Legislation)
      or Section
      6.4
      (Proceedings) are present with respect to the Schedule 2.4 ROE Assets, and
      (2)
      there are no consents or other approvals required with respect to the Schedule
      2.4 ROE Assets, (y) the information required pursuant to Section
      6.17
      (ROE
      Agreement and Subscriber Information) shall be delivered to Purchaser within
      two
      (2) days after the Initial Closing Date, and (z) the information required by
      Section 6.11
      (Technical
      Specifications), Section
      6.12
      (Owner
      Contact Information), Section
      6.13
      (Deposits), Section
      6.14
      (Free
      (“Comp”) Accounts and Service), Section
      6.15
      (Deposits), and Section
      6.16
      (Channel
      Lineups and Serial Numbers) shall be delivered to Purchaser within five (5)
      days
      after the Initial Closing Date. All
      Disclosure Schedules or other deliverables prepared by Sellers and delivered
      to
      Purchaser under the terms of this Agreement with respect to the Schedule 2.4
      ROE
      Assets shall reflect information as of 12:01 a.m. (Pacific Standard time) on
      the
      Schedule 2.4 ROE Assets Effective Date.

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    (b)  Closing.
      The
      consummation of the purchase and sale of all of the other Assets (other than
      the
      Schedule 2.4 ROE Assets) provided for herein (the “Closing”) shall take place at
      10:00 a.m. (Pacific Standard time) ninety (90) days after the date of this
      Agreement (the “Closing Date”); provided, however, that if at such time Sellers
      are in the process of continuing to negotiate New ROEs pursuant to Section
      6.6
      hereof,
      then upon written notice to Purchaser, Multiband shall have the option to extend
      the Closing for an additional ninety (90) days (the “Closing Extension Option”)
      in which case, the date that is one hundred and eighty (180) days after the
      date
      of this Agreement shall be the “Closing Date.” The
      Closing shall take place by delivery to each of Purchaser’s and Multiband’s
      principal office via facsimile transmission or email transmission in PDF file
      format (with originals sent via overnight courier service) of the documents
      to
      be delivered at the Closing and deliveries of the Purchase Price to be made
      in
      accordance with Section
      2.3,
      or at
      such other place or in such other manner as the parties hereto may
      agree.
      All
      Disclosure Schedules or other deliverables prepared by Sellers and delivered
      to
      Purchaser under the terms of this Agreement with respect to the Assets (other
      than the Schedule 2.4 ROE Assets) shall reflect information as of 12:01 a.m.
      (Pacific Standard time) on the Closing Date, unless otherwise indicated in
      this
      Agreement. 

     

    2.8  Proceedings.
      All
      proceedings taken and all documents executed and delivered by the parties hereto
      at the Initial Closing with respect to the Schedule 2.4 ROE Assets shall be
      deemed to have been taken and executed simultaneously and no proceedings shall
      be deemed taken nor any documents executed or delivered until all have been
      taken, executed and delivered. All proceedings taken and all documents executed
      and delivered by the parties hereto at the Closing with respect to the Assets
      (other than the Schedule 2.4 ROE Assets) shall be deemed to have been taken
      and
      executed simultaneously and no proceedings shall be deemed taken nor any
      documents executed or delivered until all have been taken, executed and
      delivered. 

     

    2.9  Purchase
      Price Allocation.
      The
      consideration payable by Purchaser under this Agreement shall be allocated
      among
      the Assets (the “Allocation”) first to accounts receivable and inventory and
      equipment-vehicles and the balance shall be allocated 10% to tangible personal
      property and equipment and 90% to the ROE Agreements. Purchaser and each of
      the
      Sellers agree to (a) be bound by the Allocation and not to take any position
      inconsistent with such Allocation and (b) file all returns and reports with
      respect to the transactions contemplated in this Agreement, including all
      federal, state and local tax returns on the basis of such Allocation, including
      without limitation, IRS Form 8594.

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      3

    REPRESENTATIONS
      AND WARRANTIES OF SELLERS

     

    Unless
      otherwise indicated, as of the date hereof and as of the Closing Date, each
      of
      the Sellers represents and warrants to Purchaser, jointly and severally, as
      follows:

     

    3.1  Organization.
      Multiband is a corporation duly organized, validly existing and in good standing
      under the laws of the State of Minnesota with full power and authority to
      conduct its business as it is now being conducted and to own or use the
      Multiband Assets. Rainbow
      is a limited liability company duly organized, validly existing and in good
      standing under the laws of the State of Connecticut with full power and
      authority to conduct its business as it is now being conducted and to own or
      use
      the Rainbow Assets. 

     

    3.2  No
      Subsidiaries.
      The
      Assets do not contain any interest, direct or indirect, in any business,
      corporation, joint venture, partnership, proprietorship or other entity.
      Multiband is the owner of and holds all rights with respect to the Multiband
      Assets and Rainbow is the owner of and holds all rights with respect to the
      Rainbow Assets. Except as set forth in Schedule
      3.2,
      none of
      the Business is conducted through, and none of the Assets are owned by or
      through, any direct or indirect subsidiary or Affiliate of Sellers.

     

    3.3  Authority.
      This
      Agreement constitutes the legal, valid and binding obligation of each of the
      Sellers enforceable against each of them in accordance with its terms. Upon
      the
      execution and delivery by the Sellers of the New ROEs, Noncompetition
      Agreements, the Call Center and Billing Agreement and the Internet Agreement
      and
      each other agreement to be executed or delivered by each such party at the
      Closing (collectively, the Sellers’ Closing Documents”), each of Sellers’
Closing Documents will constitute the legal, valid and binding obligation of
      each of the Sellers, enforceable against each of them in accordance with its
      terms, subject
      to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
      and
      similar laws of general applicability relating to or affecting creditors’ rights
      and to general equity principles.
      Each of
      the Sellers has the absolute and unrestricted right, power and authority to
      execute and deliver this Agreement and each of the Sellers’ Closing Documents to
      which it is a party and to perform its obligations under this Agreement and
      each
      of the Sellers’ Closing Documents to which it is a party, and such action has
      been duly authorized by all necessary action by such Seller’s shareholders or
      members and board of directors or managers. No further proceeding on the part
      of
      any of the Sellers or their respective shareholders, members, managers or board
      of directors is necessary to authorize this Agreement, each of the Sellers’
Closing Documents to which it is a party and the transactions contemplated
      hereby.
      Neither
      the execution and delivery
      of this Agreement nor compliance by any of the Sellers with its terms and
      provisions will violate (i) any provision of the Articles of Incorporation,
      Articles of Organization, Bylaws or Operating Agreement, as applicable, of
      such
      Seller, (ii) any Contract transferred to Purchaser or any permit or license
      of
      Sellers relating to the Business, or (iii) any law, statute, regulation,
      injunction, order or decree of any government agency or authority or court
      to
      which Sellers, the Business or any of the Assets is subject, except to the
      extent that any such violation would not be material with respect to the Assets
      individually or in the aggregate.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    3.4  Capitalization.
      Multiband is and will be on the Closing Date the sole record and beneficial
      owner and holder of the issued and outstanding shares of Rainbow and such shares
      are and will be owned by Multiband, free and clear of all Liens. There are
      no
      Contracts relating to the issuance, sale or transfer of any equity securities
      or
      other securities of Rainbow. 

     

    3.5  Financial
      Information Reports.
      

     

    (a)  Each
      Seller has delivered to Purchaser the following financial information,
      (collectively, with any updates thereof, the “Financial Information Reports”):
      (a) an unaudited balance sheet as of June 30, 2006 (including the notes thereto,
      the “Balance Sheet”), and (b) the related monthly statements of income for the
      months of January through June 2006. Each of the Financial Information Reports
      delivered to Purchaser hereunder and pursuant to Section
      5.8
      below is
      and will be complete and correct and was and will be prepared from and is and
      will be in accordance with the accounting records of the Sellers which have
      been
      maintained in accordance with sound business practices and based on Sellers’
financial statements which have been prepared in accordance with GAAP
      consistently applied. 

     

    (b)  Schedule
      3.5(b) sets
      forth a correct and complete schedule of the calculation of the Closing Date
      Gross Revenue for each of the ROE Properties.

     

    (c)  Schedule
      3.5(c)
      sets
      forth a correct and complete schedule of the calculation of the Closing Date
      Direct Costs for each of the ROE Properties.

     

    (d)  Schedule
      3.5(d)
      sets
      forth a correct and complete schedule of the calculation of the Closing Date
      Gross Margin for each of the ROE Properties.

     

    3.6  Sufficiency
      of Assets; Title.
      

     

    (a)  The
      Assets (a) constitute all of the assets, tangible and intangible, of any nature
      whatsoever, necessary to operate Sellers’ Business in the manner presently
      operated by Sellers, and (b) include all of the California operating assets
      of
      the Sellers used in the Business.
      The
      Assets are suitable for the uses for which they are currently used by Sellers
      in
      the Business. 

     

    (b)  Schedule
      3.6
      contains
      a true and complete listing of each vehicle that is used in the Business, each
      driver that is assigned to such vehicle, whether the vehicle is owned or leased
      by the Sellers and an indication as to whether the vehicle belongs to an
      employee of the Sellers and if employee-owned, the applicable mileage
      reimbursement rate. Sellers will pay and satisfy any and all obligations with
      respect to the leased vehicles reflected on Schedule
      3.6
      on or
      prior to the Closing and at the Closing will deliver to Purchaser title to
      such
      leased vehicles and the Sellers’ owned vehicles, free and clear of all
      Liens.

     

    (c)  Each
      Seller has or will have, and, upon consummation of the transactions contemplated
      hereby, will convey to Purchaser, full right, title and interest, and good
      and
      marketable title, to their respective Assets, free and clear of all Liens.
      To
      the
      Knowledge of Sellers, there are no claims, objections or bases for objections
      which any Owner of any ROE Property or any predecessor
      to either of the Sellers may raise in connection with any ROE Agreement or
      the
      other Assets and the transactions contemplated by this Agreement.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    3.7  Contracts.
      Each
      Contract required to be listed on a Schedule hereto is valid and subsisting
      and
      is in full force and effect in accordance with its terms, subject to bankruptcy,
      insolvency, fraudulent transfer, reorganization, moratorium and similar laws
      of
      general applicability relating to or affecting creditors’ rights and to general
      equity principles, and there have been no amendments, creditors modifications,
      or supplements to any such Contract. There is no default by either Seller or
      claim of default by either Seller, or, to the Knowledge of Sellers, any other
      party thereto, under any such Contracts and no Event has occurred that, with
      the
      passage of time or the giving of notice or both, could reasonably be expected
      to
      constitute a default by either Seller or, to the Knowledge of Sellers, any
      other
      party thereto under any such Contract, or could reasonably be expected to permit
      modification, acceleration, or termination of any such Contract, or result
      in
      the creation of any Lien on any of the Assets. No party to any Contract has
      notified any Seller of its intention to terminate any Contract and to the
      Knowledge of Sellers, no party to any Contract has indicated its intent to
      do
      so, whether by exercising any termination or buy-out rights under any Contract
      or otherwise. 

     

    3.8  ROE
      Agreements.
      

     

    (a)  Attached
      hereto as Schedule
      3.8(a) is
      a
      complete and correct list of each Multiband ROE Agreement and each Rainbow
      ROE
      Agreement that is included in the Assets, including, without limitation, the
      correct and complete: (i) name and address of each ROE Property, (ii) the number
      of units at each ROE Properties, (iii) the type of service provided at each
      ROE
      Property, and (iv) the expiration date of the term of each ROE Agreement,
      provided, however, that the failure to set forth the exact correct number of
      units and property name of each Property will not have or be reasonably expected
      to have a Material Adverse Effect. Except as set forth on Schedule
      3.8(a) and
      Schedule
      3.8(b) below,
      there are no other Contracts (whether oral or written) entered into between
      either of the Sellers and any of the Owners of the ROE Properties that affect
      any of the Assets other than the RandM Assets. 

     

    (b)  Schedule
      3.8(b) sets
      forth a true and correct list of each ROE Agreement with respect to which
      neither of the Sellers is paying any Owner Commissions or any programming fees
      to DirecTV, 4COM or any other programming services provider. There are no
      revenues or expenses associated with such ROE Properties because there are
      no
      subscribers at such ROE Properties and although Sellers have the right to
      provide television service and programming to such ROE Properties, no such
      service is currently provided by the Sellers. The failure to provide such
      service is not a breach of the ROE Agreements for such ROE Properties.

     

    (c)  As
      of the
      Closing, Schedule
      3.8(c) includes
      (i) a complete and correct list of each RandM ROE Agreement that is included
      in
      the Assets, including, without limitation, the correct and complete: (1) name
      and address of each ROE Property, (2) the number of units and the number and
      type of Subscribers at each ROE Property, (3) the type of service provided
      at
      each ROE Property, and (4) the expiration date of the term of each ROE
      Agreement, and (ii) a complete and correct list of each ROE Agreement that
      is
      included in the Assets but for which Sellers do not have copies of the
      respective ROE Agreements (each, a “Missing ROE Agreement”), including, without
      limitation, the correct and complete: (1) name and address of each such ROE
      Property, (2) the number of units and the number and type of Subscribers at
      each
      such ROE Property, (3) the type of service provided at each such ROE Property,
      (4) to the extent available, the expiration date of the term of each Missing
      ROE
      Agreement and (5) name of the Seller that provides the services pursuant to
      such
      Missing ROE Agreement. Except as set forth on Schedule
      3.8(c),
      there
      are no other Contracts (whether oral or written) entered into between either
      of
      the Sellers and any of the Owners of the ROE Properties that affect any of
      the
      RandM Assets. Sellers represent that they have all right, title and interest
      in
      and to each Missing ROE Agreement and that the applicable Seller indicated
      has
      the right to provide the Services at such ROE Properties. 

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

     

    (d)  The
      Weighted Average Remaining ROE Agreement Term of the ROE Agreements is ten
      (10)
      months as of September 30, 2006. As of the Closing, the Weighted Average
      Remaining ROE Agreement Term of the ROE Agreements will be at least sixty (60)
      months. 

     

    (e)  Prior
      to
      the Closing, Sellers have delivered to Purchaser, true and complete files for
      each ROE Agreement,
      including, without limitation, the fully executed ROE Agreement, any schedules,
      exhibits, annexes, memoranda, assignments and amendments thereto,
      all
      correspondence with respect to each ROE Agreement since the acquisition date
      of
      each applicable ROE Agreement, and all instruments of transfer, assignment,
      conveyance and other instruments evidencing the applicable Seller’s chain of
      title with respect to each ROE Agreement, and hereby represents that each such
      transfer, assignment or other conveyance was in all respects legally effected
      and sufficient to convey, transfer and assign to the applicable Seller all
      right, title and interest in each ROE Agreement and the Assets
      (collectively, the “ROE Files”).
      Each
      ROE Agreement (i) represents the valid, binding and legal obligation of
the
      respective Seller
      and each
      other
      party
      thereto,
      enforceable against such party in accordance with its terms; (ii) contains
      the
      expiration date of the term of such ROE Agreement and the exact number of
      apartment, dwelling or similar units at such ROE Property; and (iii) is in
      full
      force and effect according to the terms set forth in the ROE Agreement and
      has
      not been modified, supplemented or amended in any way. 

     

    3.9  SMATV
      Non-Bulk Properties.
      Schedule
      3.9 sets
      forth a correct and complete list by ROE Property of each ROE Property that
      has
      SMATV Non-Bulk Service, the number of SMATV units, the number of channels
      available at each such ROE Property, which channels include local and transport
      stations delivered by 4COM, the monthly rate charged per subscriber for the
      SMATV Non-Bulk Service, the total monthly revenues at such ROE Property for
      the
      SMATV Non-Bulk Service, the number of SMATV Non-Bulk Service subscribers, the
      total monthly transport fees payable by Sellers to 4COM for the transport
      stations at such ROE Property and the total monthly fees payable by Sellers
      to
      DirecTV for the SMATV Non-Bulk Service.  

     

    3.10  HDTV
      Properties.
      Schedule 3.10
      sets
      forth a correct and complete list of each ROE Property that is HDTV ready,
      together with the applicable HDTV platform installed at such ROE Property and
      a
      list of ROE Properties that have requested an HDTV upgrade.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    3.11  Exclusivity.
      

     

    (a)  Except
      as
      set forth on Schedule
      3.8(a),
      each of
      the ROE Properties is exclusive to the respective Seller represented as holding
      the rights to such ROE Property with respect to the System and System Equipment
      (the “Exclusive Agreements”).

     

    (b)  Except
      as
      set forth on Schedule
      3.8(a)
      with
      respect to the Exclusive Agreements,
      (a)
      there
      is currently no franchise cable operator (“FCO”) connected to any minimum point
      of entry at any of the ROE Properties and no FCO has over built any of the
      Sellers’ Systems at any of the ROE Properties; (b) no unit at any ROE Property
      is serviced by the FCO; and (c) Sellers have sole and exclusive access to each
      of the ROE Properties in connection with (1) the provision of television service
      and programming delivered to each of the units on such ROE Properties using
      the
      cable distribution system and inside wiring at each such ROE Property and (2)
      the solicitation of residents residing at each ROE Property. 

     

    3.12  Access
      to ROE Properties.
      Pursuant to each ROE Agreement, each Seller has the right of ingress, egress,
      access and right of way across, through, in or on each part and all of the
      ROE
      Property covered by such ROE Agreement, to each unit within such ROE Property
      and to all Systems and System Equipment located on such ROE Property and used
      in
      the operation of the cable television or other similar system on such ROE
      Property, sufficient to provide the services that are required to be provided
      pursuant to each ROE Agreement. Neither Seller has been notified by any Owner
      of
      any ROE Property about any limitations or restrictions on such Owner’s ability
      to grant such rights to such Seller.

     

    3.13  Ownership
      of Assets.
      Except
      as set forth on Schedule
      3.13,
      Multiband owns all the Systems, the Systems Equipment used to provide the
      services to each of the ROE Properties under the Multiband ROE Agreements and
      all the other Multiband Assets and Rainbow owns all the Systems, the Systems
      Equipment used to provide the services to each of the ROE Properties under
      the
      Rainbow ROE Agreements and all the other Rainbow Assets. Neither Seller has
      previously assigned or transferred any of its right, title or interest in,
      to or
      under the Assets, and each Seller holds such right, title and interest free
      and
      clear of any and all Liens. Neither Seller has removed any of the Systems,
      Systems Equipment or other Assets that were located on any ROE Property at
      the
      time that Purchaser surveyed each of the ROE Properties during the period from
      September 20-22, 2006 (the “Inspection”). All of the Assets are materially in
      the same condition and functioning in the same manner as during the Inspection.
      

     

    3.14  Accounts
      Receivable.
      Schedule
      3.14
      sets
      forth a correct and complete summary of all of the accounts receivable with
      respect to each ROE Property included in the Assets, including the aging of
      each
      account receivable segregated by Performing Subscriber and Non-performing
      Subscriber (the “Aging A/R Summary Report”), with supporting details to be
      electronically delivered to Purchaser at the Closing. All accounts receivable
      reflected on Schedule
      3.14
      represent or will represent valid obligations arising from sales actually made,
      services actually performed or services actually billed by Sellers.

     

    3.15  Absence
      of Undisclosed Liabilities.
      Except
      as set forth on Schedule
      3.15,
      other
      than obligations under the ROE Agreements with respect to the applicable ROE
      Property to which such ROE Agreement relates, there are no Liens, debts,
      liabilities or obligations, of any nature, affecting the Assets. 
      Each
      Seller shall pay, discharge and perform promptly, when due, any and all Retained
      Liabilities of the Sellers that directly or indirectly affect the Assets.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    3.16  Absence
      of Certain Changes and Events.

     

    (a)  Since
      June 30, 2006, there has not been any change or occurrence that reasonably
      indicates there may be any change, in the management, business, prospects,
      results of operations or condition (financial or otherwise) of the Assets or
      the
      Business that has or could reasonably be expected to have a Material Adverse
      Effect.

     

    (b)  Since
      June 30, 2006, neither Seller has (i) transferred or otherwise disposed of
      any
      of the Assets; (ii) entered into any compromise or settlement of or suffered
      any
      judgment in any litigation, proceeding, or governmental investigation relating
      to the Assets; (iii) suffered any material damage or destruction to, or loss
      of,
      any of the Assets whether or not covered by insurance; (iv) entered into any
      Contract, including, without limitation, with respect to Owner Commissions
      or
      other side Contract requiring any payments to be made with respect to the
      Assets; (v) except as set forth on Schedule
      3.16, entered
      into any Contract
      to purchase or otherwise acquire control of any access
      and use agreements or service and installation agreements
      similar
      in nature to the ROE Agreements, either directly or indirectly, in the States
      of
      California and Arizona, including, without limitation, acquiring the assets
      of
      any system operator or other Person that engages in the Private Cable Operator
      Business in California or Arizona or (vi) entered into any written or oral
      Contract, other than this Agreement, to do any of the things enumerated in
      (i)
      through (v) of this Section
      3.16.

     

    3.17  Litigation.

     

    (a)  Set
      forth
      on Schedule
      3.17
      is a
      true and complete list of all actions, suits, proceedings, audits and
      investigations instituted against or by any Seller affecting the Business or
      the
      Assets, since the acquisition of each ROE Agreement by the respective Seller,
      and a brief description of the nature and status thereof. There are no actions,
      suits or proceedings served and pending or, to the Knowledge of Sellers,
      threatened against or by either Seller relating to or affecting the Assets,
      at
      law, in equity or otherwise, in, before or by any court, arbitrator or
      governmental agency or authority. There are no unsatisfied judgments or
      outstanding orders, injunctions, decrees, stipulations or awards (whether
      rendered by a court or administrative agency or by arbitration) against or
      affecting any of the Assets or the Business. Prior to the date of this
      Agreement, each Seller has delivered to Purchaser for review all Owner complaint
      files maintained by such Seller relating to the Assets for the past two (2)
      years.

     

    (b)  As
      of the
      Closing, to the Knowledge of Sellers, (i) there are no claims, rights or actions
      that have accrued or could be asserted by either Seller against the Owner of
      any
      ROE Property specifically identified in this Agreement or any Schedule, Annex
      or
      Exhibit hereto or any of its affiliates (collectively, the “Owner Parties”) for
      any default, breach or violation by any Owner Parties under the applicable
      ROE
      Agreement; and (ii) neither Seller has any offsets or defenses that could be
      asserted in any action against any Owner Parties for payments or other
      obligations due under the applicable ROE Agreement.

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    3.18  Compliance
      with Law.
      Neither
      Seller is in violation of any applicable law, ordinance or regulation of any
      governmental entity which would affect the Assets or the Business. All
      governmental approvals, registrations, notifications, permits, licenses and
      other permissions or authorizations (collectively, “Authorizations”) required in
      connection with the conduct of the Business have been obtained and are in full
      force and effect and are being complied with by each Seller. Except as set
      forth
      on Schedule
      3.18,
      since
      the acquisition by the respective Seller of each ROE Agreement, neither Seller
      has received any written notification of any asserted past or present violation
      in connection with the conduct of the Business of any applicable law, ordinance
      or regulation, or any written complaint, inquiry or request for information
      from
      any governmental entity relating thereto. Neither of the Sellers nor any of
      the
      Assets is the subject of any federal, state or local enforcement action or,
      to
      the Knowledge of Sellers, other investigation, including but not limited to
      those relating to Environmental Laws and Regulations.

     

    3.19  Consents.
      Schedule
      3.19
      lists
      each consent, approval, waiver or authorization (collectively, the “Consents”)
      that is legally or contractually required on the part of any Seller to duly
      and
      validly transfer or assign each of the Assets as contemplated
      hereby.

     

    3.20  Programming
      Services Fees.
      Schedules
      3.9, 3.30 and 3.31 set
      forth
      all the fees for programming services paid to 4Com and DirecTV in connection
      with the Assets. Except as set forth on Schedules
      3.9, 3.30 and 3.31,
      neither
      Seller pay fees to any other programming aggregator or supplier with respect
      to
      the ROE Properties. Neither Seller is providing any foreign programming pursuant
      to the terms of any cross license or other similar agreement with any third
      party providers.

     

    3.21  Subscriber
      Information.
      

     

    (a)  Schedule
      3.21 sets
      forth a correct and complete list of the residual payments that DirecTV has
      paid
      to Sellers for the month ended June 30, 2006 and the total number of DTH
      Subscribers of Sellers with respect to the ROE Properties as of June 30, 2006.
      The information contained in Schedule
      3.21
      is
      consistent with the information provided to Sellers by DirecTV for the month
      ended June 30, 2006.

     

    (b)  On
      or
      prior to the Closing Date, each Seller has delivered to Purchaser correct and
      complete copies of all of each Seller’s subscriber records for all of such
      Seller’s subscribers. Such copies contain all the terms of the Contracts,
      agreements, understandings and arrangements between the parties thereto with
      respect to the subject matter thereof.

     

    3.22  Utility
      Payments.
      Except
      for the ROE Agreement with respect to the Mira Verde ROE Property that provides
      for reimbursement to certain homeowners at the rate of $5.51 per year for
      utility services, there are no other utility payments payable by either Seller
      to any Owner or resident of an ROE Property.

     

    3.23  Control
      Room and Head End Rental Payments.
      There
      are no lease rental or similar fees payable by any Seller for use of any space
      required in connection with any System or component thereof at any ROE Property,
      including, without limitation, any rooftop lease or similar
      arrangements.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    3.24  Retransmission
      Fees.
      There
      are no retransmission fees or similar payments or compensation payable to any
      Owner in connection with retransmission of signals from any ROE Property to
      other properties serviced by any Seller.

     

    3.25  Owner
      Commissions.
      Schedule
      3.25 sets
      forth a correct and complete list for each ROE Property of the amount of Owner
      Commissions payable to each Owner for the month ended August 31, 2006 and will
      be updated to reflect such Owner Commissions through the Closing Date, the
      type
      of revenue on which any such Owner Commissions are calculated, the frequency
      of
      payment and the due date for each such payment.

     

    3.26  Owner
      Advances.
      There
      are no Owner Advances required to be paid under the terms of any of the ROE
      Agreements.

     

    3.27  Free
      Off-Air Channels.
      Neither
      Seller is required to provide free access to any off-air channels or similar
      local programming or SMATV Non-Bulk Service under the terms of any ROE
      Agreement. 

     

    3.28  UCCs.
      Neither
      of the Sellers nor, to the Knowledge of Sellers, any predecessor of Sellers
      has
      filed any UCC-1 National Financing Statement with respect to the
      Assets.

     

    3.29  Memorandums
      of Agreement.
      Neither
      Seller has recorded or is aware of any predecessor having recorded any
      memorandum of agreement or similar instrument in the public records in the
      county in which any ROE Property subject to an ROE Agreement is
      located.

     

    3.30  Bulk
      SMATV Service.
      Except
      as set forth on Schedule
      3.30,
      neither
      Seller is required to provide Bulk SMATV Service to any ROE
      Property.
      For each
      ROE Property at which any Seller is required to provide Bulk SMATV Service,
      Schedule
      3.30 sets
      forth the type of Bulk SMATV Service provided at such ROE Property (whether
      analog or SMATV with a digital overlay for providing DirecTV), the number of
      units at such ROE Property, the number of channels available on each System
      for
      such ROE Property, the current rate charged to each Owner for such Bulk SMATV
      Service, the additional fees charged to each Owner by Multiband, the fees
      charged by DirecTV to Multiband for the SMATV Bulk Service programming cost,
      the
      transport fees charged by 4COM to Multiband for such ROE Property and an
      indication of whether such ROE Property is invoiced directly by Sellers for
      all
      costs or by DirecTV for programming costs and by Sellers for the additional
      fees. For the ROE Properties invoiced by Sellers, the rates that the Sellers
      charge Owners for Bulk SMATV Service are at least the same as those rates which
      DirecTV charges the Sellers for such Bulk SMATV Service.

     

    3.31  Bulk
      Digital Service.
      Except
      as set forth on Schedule
      3.31,
      neither
      Seller is required to provide Bulk Digital Service to any ROE Property. For
      each
      ROE Property at which a Seller is required to provide Bulk Digital Service,
      Schedule
      3.31 sets
      forth the type of Bulk Digital Service provided at such ROE Property (whether
      digital or BCA), the number of units at such ROE Property, the current rate
      charged to each Owner for such Bulk Digital Service, the additional fees charged
      to each Owner by Sellers, the fees charged by DirecTV to Sellers for the Bulk
      Digital Service programming cost and an indication of whether such ROE Property
      is invoiced directly by Sellers for all costs or by DirecTV for programming
      costs and by Sellers for the additional fees. For the ROE Properties invoiced
      by
      Sellers, the rates that the Sellers charge Owners for Bulk Digital Service
      are
      at least the same as those rates which DirecTV charges the Sellers for such
      Bulk
      Digital Service.

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

    3.32  Other
      Commissions.
      At the
      Closing, there will be no commission payments due from Sellers to any Person
      with respect to the Assets except for the December 2006 Owner Commissions which
      will be paid by Purchaser after the Closing. 

     

    3.33  DirecTV
      Registration and Charges.
      Neither
      Seller has registered any of the ROE Properties with any direct broadcast
      satellite provider other than DirecTV. Schedule
      3.33 sets
      forth a correct and complete list of the DirecTV prepaid programming commissions
      paid to Sellers for the months of January through August 2006. 

     

    3.34  Employees.
      

     

    (a)  Except
      for Morris Eiseman, Schedule
      3.34 sets
      forth a correct and complete list of the following information for each
      employee, independent contractor, consultant and agent of the Sellers employed
      in the Business, including each employee on leave of absence or layoff status,
      employer, name, job title, date of hire, date of commencement of employment,
      current compensation paid, each individual that is employed by the Sellers
      in
      connection with the Business, their title and rate of pay. 

     

    (b)  Neither
      Seller has violated the Worker Adjustment and Retraining Notification Act (the
      “WARN Act”) or any similar state or local Legal Requirement and neither the
      Closing nor the transactions contemplated under this Agreement will cause or
      result in any such violation.

     

    (c)  No
      former
      or current employee of either Seller is a party to or is otherwise bound by,
      any
      Contract that in any way adversely affected, affects or will affect the ability
      of such Seller or Purchaser to conduct the business as heretofore carried on
      by
      such Seller.

     

    (d)  No
      present or former employee of any Seller or of any Subsidiary has advanced
      any
      material claim (whether under any applicable law, through any governmental
      agency, under an employment agreement, collective bargaining agreement, personal
      service or independent contractor agreement or otherwise) that is currently
      pending, or to the Knowledge of Sellers, threatened for (i) overtime pay, wages,
      salaries or profit sharing, vacation pay, paid time off (including, without
      limitation, potential sick leave) or pay in lieu of vacation or time off, (ii)
      any violation of any law relating to minimum wages or maximum hours of work,
      (iii) discrimination against employees on any basis, (iv) unlawful employment
      or
      termination practices, (v) unfair labor practices, (vi) any violation of
      occupational safety and/or health standards, (vii) benefits under any employee
      plans or compensation arrangement, or (viii) breach of any employment, personal
      service or independent contractor agreement. Neither of the Sellers nor any
      Subsidiary is a party to any collective bargaining agreement or is the subject
      of any labor dispute or activity involving the proposed organization of a union
      for any group or class of employees, and there has not been any strike or work
      stoppage of any kind called or, to the Knowledge of Sellers, threatened, against
      either of the Sellers or any Subsidiary. 

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

     

    3.35  ERISA.
      

     

    (a)  Schedule
      3.35 sets
      forth a correct and complete list of all “employee benefit plans” as defined by
      Section 3(3) of ERISA, all specified fringe benefit plans as defined in Section
      6039D of the Code, and all other bonus, incentive compensation, deferred
      compensation, profit sharing, stock option, stock appreciation right, stock
      bonus, stock purchase, employee stock ownership, savings, severance,
      change-in-control, supplemental unemployment, layoff, salary continuation,
      retirement, pension, health, life insurance, disability, accident, group
      insurance, vacation, holiday, sick leave, fringe benefit or welfare plan, and
      any other employee compensation or benefit plan, agreement, policy, practice,
      commitment, Contract or understanding (whether qualified or nonqualified,
      currently effective or terminated, written or unwritten) and any trust, escrow
      or other agreement related thereto that (i) is maintained or contributed to
      by
      any Seller or any other corporation or trade or business controlled by,
      controlling or under common control with such Seller (within the meaning of
      Section 414 of the Code or Section 4001(a)(14) or 4001(b) of ERISA) (“ERISA
      Affiliate”) or has been maintained or contributed to in the last six (6) years
      by any Seller or any such Seller’s ERISA Affiliate, or with respect to which any
      Seller or any ERISA Affiliate has or may have any liability, and (ii) provides
      benefits, or describes policies or procedures applicable to any current or
      former director, officer, employee or service provider of any Seller or any
      such
      Seller’s ERISA Affiliate, or the dependents of any thereof, regardless of how
      (or whether) liabilities for the provision of benefits are accrued or assets
      are
      acquired or dedicated with respect to the funding thereof (collectively the
      “Employee Plans”). Schedule
      3.35
      identifies as such any Employee Plan that is (i) a “Defined Benefit Plan” (as
      defined in Section 414(l) of the Code); (ii) a plan intended to meet the
      requirements of Section 401(a) of the Code; (iii) a “Multiemployer Plan” (as
      defined in Section 3(37) of ERISA); or (iv) a plan subject to Title IV of ERISA,
      other than a Multiemployer Plan. Also set forth on Schedule
      3.35
      is a
      complete and correct list of all ERISA Affiliates of Sellers during the last
      six
      (6) years.

     

    (b)  Sellers
      have delivered to Purchaser true, accurate and complete copies of (i) the
      documents comprising each Employee Plan (or, with respect to any Employee Plan
      which is unwritten, a detailed written description of eligibility,
      participation, benefits, funding arrangements, assets and any other matters
      which relate to the obligations of Seller or any ERISA Affiliate) and all
      material documents, reports or filings related to each such Employee
      Plan.

     

    (c)  Seller
      has, at all times, complied, and currently complies, in all material respects
      with the applicable continuation requirements for its welfare benefit plans,
      including (1) Section 4980B of the Code (as well as its predecessor provision,
      Section 162(k) of the Code) and Sections 601 through 608, inclusive, of ERISA,
      which provisions are hereinafter referred to collectively as "COBRA" and (2)
      any
      applicable state statutes mandating health insurance continuation coverage
      for
      employees. Except for the continuation coverage requirements of COBRA, neither
      Seller has any obligations or potential liability for benefits to employees,
      former employees or their respective dependents following termination of
      employment or retirement under any of the Employee Plans that are Employee
      Welfare Benefit Plans.

     

    (d)  The
      form
      of all Employee Plans is in compliance with the applicable terms of ERISA,
      the
      Code, and any other applicable laws, and such plans have been operated in
      compliance with such laws and the written Employee Plan documents. All required
      reports and descriptions of the Employee Plans (including Internal Revenue
      Service Form 5500 Annual Reports, Summary Annual Reports and Summary Plan
      Descriptions and Summaries of Material Modifications) have been (when required)
      timely filed with the IRS, the U.S. Department of Labor or other governmental
      body and distributed as required, and all notices required by ERISA or the
      Code
      or any other Legal Requirement with respect to the Employee Plans have been
      appropriately given.

     

    
      
        
        

      

      
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    (e)  Each
      Seller has maintained workers' compensation coverage as required by applicable
      state law through purchase of insurance and not by self-insurance or
      otherwise.

     

    (f)  None
      of
      the transactions contemplated by this Agreement will result in an amendment,
      modification or termination of any of the Employee Plans. No written or oral
      representations have been made to any employee or former employee of any Seller
      promising or guaranteeing any employer payment or funding for the continuation
      of medical, dental, life or disability coverage for any period of time beyond
      the end of the current plan year (except to the extent of coverage required
      under COBRA). No written or oral representations have been made to any employee
      or former employee of any Seller concerning the employee benefits of
      Purchaser.

     

    (g)  No
      accumulated funding deficiency (as defined in section 302 of ERISA and section
      412 of the Code), whether or not waived, exists with respect to any Plan. No
      liability to the Pension Benefit Guaranty Corporation has been or is expected
      by
      any Seller or any ERISA Affiliate to be incurred with respect to any Plan by
      any
      Seller or any ERISA Affiliate that could reasonably be expected to have a
      material adverse effect on the Business or the Assets. Neither Seller
      participates in or contributes, or has participated in or contributed, to any
      Multiemployer Plan. 

     

    3.36  Taxes.
      Each
      Seller has filed and paid, or has made provision for the payment of, and will
      pay all Taxes that affect the Assets. On or prior to the Closing Date, each
      Seller will deliver to Purchaser a copy of the Business Property Statements
      filed on or before April 1, 2006 for the calendar year 2006 and City Tax returns
      filed in January 2006 for each city in which an ROE Property is
      located.

     

    3.37  Maintenance
      of Insurance.
      Each
      Seller maintains with financially sound and reputable insurers, insurance in
      such amounts and against such liabilities and hazards as is customarily
      maintained by other companies operating similar businesses as the Business
      and
      necessary to preserve the value of the Assets (the “Insurance”). 

     

    3.38  Rooftop
      Rights.
      Schedule
      3.38 attached
      hereto sets forth a correct and complete list of all rooftop right or similar
      Contracts entered into by any Seller with respect to sending
      or receiving internet or other services via a rooftop microwave system. Each
      of
      the Sellers has secured all rights, licenses and permits necessary to exercise
      such rooftop rights and to use a rooftop microwave system. 

     

    3.39  System
      Operators.
      Schedule
      3.39
      sets
      forth a true and complete list of all system operators affiliated with each
      Seller in California or Arizona and the number of subscribers each system
      operator has as of the date of this Agreement and as of the Closing Date.
      Purchaser agrees that it shall not disclose the information set forth in
Schedule
      3.39
      to
      anyone other than its employees and representatives who have a need to know
      such
      information and solely in connection with the purposes of this
      Agreement.

     

    
      
        
        

      

      
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    3.40  Free
      “Comp” Accounts.
      Except
      for the free or complimentary accounts provided to Owners of the ROE Properties
      to be disclosed to Purchaser on or prior to the Closing pursuant to Section
      6.14,
      neither
      Seller is required to provide any other form of free service, including, without
      limitation, free introductory service to new Subscribers, under the terms of
      any
      of the ROE Agreements. Neither Seller is required to pay any Owner Commissions
      under any ROE Agreement with respect to any free “comp” accounts or service at
      any of the ROE Properties.

     

    3.41  Acquisitions.
      Since
      January 1, 2006, neither of the Sellers nor any of their direct or indirect
      subsidiaries have entered into, or are contemplating entering into, and there
      is
      not pending any Contract, whether written or oral, including, without
      limitation, any letter of intent, regarding any acquisitions, mergers, joint
      ventures, divestitures or other material company events that would affect the
      Assets or the Business.

     

    3.42  Transport
      Subscribers.
      Each
      Seller has accurately and completely reported the number of transport
      subscribers at all of the ROE Properties to 4COM.

     

    3.43  No
      Brokers or Finders.
      Neither
      of the Sellers nor any of their Affiliates, employees or agents have incurred
      any obligation or liability, contingent or otherwise, for brokerage or finders’
fees or agents’ commissions or other similar payments in connection with the
      sale of either Sellers’ Business or the Assets or the transactions contemplated
      by this Agreement. 

     

    3.44  Disclosure.
      To the
      Knowledge of Sellers, no representation or warranty by any Seller in this
      Agreement, and no information disclosed in the Schedules or Exhibits supplied
      by
      Sellers, contains any untrue statement of a material fact or, taken as a whole,
      omits to state a material fact necessary to make the statements contained herein
      or therein not misleading.

     

    ARTICLE
      4

    REPRESENTATIONS
      AND WARRANTIES OF PURCHASER

     

    As
      of the
      Closing, Purchaser represents and warrants to the Sellers as
      follows:

     

    4.1  Organization
      of Purchaser.
      Purchaser is a limited liability company duly formed, existing and in good
      standing under the laws of the State of California.

     

    4.2  Authority.
      Purchaser has all requisite company power and authority to enter into this
      Agreement and to perform its obligations hereunder. This Agreement has been
      duly
      authorized, executed, and delivered by Purchaser and constitutes a legal, valid
      and binding agreement of Purchaser, enforceable against Purchaser in accordance
      with its terms. No further proceeding on the part of Purchaser is necessary
      to
      authorize this Agreement and the transactions contemplated hereby. Neither
      the
      execution and delivery of this Agreement nor compliance by Purchaser
      with its terms and provisions will violate (i) any provision of the articles
      of
      organization or operating agreement of Purchaser, (ii) any contract, permit
      or
      license of Purchaser, or (iii) any law, statute, regulation, injunction, order
      or decree of any government agency or authority or court to which Purchaser
      or
      any of Purchaser’s assets is subject.

     

    
      
        
        

      

      
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    4.3  Consents.
      Except
      as set forth on Purchaser’s Schedule
      4.3,
      there
      is no consent, approval, waiver or authorization that is legally or
      contractually required on the part of Purchaser to duly and validly purchase
      or
      acquire each of the Assets as contemplated hereby.

     

    4.4  No
      Brokers or Finders.
      Except
      for Purchaser’s obligation to pay Paradigm Marketing Group, Inc. a brokers fee
      or commission for the services of Mr. Donald
      Johnson
      in
      connection with the transactions contemplated by the Agreement, neither
      Purchaser nor any of its affiliates, employees or agents have
      incurred any obligation or liability, contingent or otherwise, for brokerage
      or
      finders’ fees or agents’ commissions or other similar payments in connection
      with the transactions contemplated by this Agreement. 

     

    4.5  Disclosure.
      To the
      Knowledge of Purchaser, no representation or warranty by Purchaser in this
      Agreement contains any untrue statement of a material fact or, taken as a whole,
      omits to state a material fact necessary to make the statements contained herein
      or therein not misleading.

     

    ARTICLE
      5

    CERTAIN
      COVENANTS AND AGREEMENTS

     

    5.1  Confidentiality.
      All
      Confidential Information in connection with the transactions contemplated by
      this Agreement shall be kept confidential by each Seller and such Seller’s
      respective members, managers, officers, directors, employees, agents and
      representatives, Purchaser and its respective officers, directors, employees,
      agents and representatives (the “Purchaser’s Agents”), and shall not be
      disclosed by any of the parties hereto to anyone (other than their respective
      affiliates, members, shareholders, representatives and agents (including,
      without limitation, accountants, bankers, financial advisors and attorneys)
      with
      a reasonable need to know such information) at anytime for any purpose, without
      the prior written consent of the other party, provided that following the
      Closing, the Purchaser may disclose or permit the Purchaser’s Agents to disclose
      such information to third parties as reasonably necessary in connection with
      Purchaser’s acquisition and operation of the Assets. 

     

    5.2  Access
      to Information and Records.
      In
      connection with the transactions contemplated by this Agreement, during the
      period from the signing of this Agreement through the Closing Date, each Seller
      shall (a) give Purchaser the same full and free access as such Seller has to
      the
      Assets, including, without limitation, the ROE Properties, the Systems or any
      part thereof at the ROE Properties, the Owners, the property management team
      and
      the subscribers at each ROE Property and the such Seller’s personnel,
      Contracts,
      books
      and records and other documents and data relating to the Assets or the Business;
      (b) furnish Purchaser with copies of all such Contracts, books and records
      and
      other existing documents and data as Purchaser may reasonably request; (c)
      furnish Purchaser with such additional financial, operating and other relevant
      data and information as Purchaser may reasonably request; and (d) otherwise
      cooperate and assist, to the extent reasonably requested by Purchaser, with
      Purchaser’s investigation of the ROE Properties, Assets and financial condition
      related to each Seller.

     

    5.3  Operation
      of the Business of Sellers.
      Between
      the date of this Agreement and the Closing, each Seller shall:

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

     

    (a)  Conduct
      its business only in the ordinary course and consistent with past
      practice;

     

    (b)  Except
      as
      otherwise directed by Purchaser in writing, and without making any commitment
      on
      Purchaser’s behalf, use its best efforts to preserve intact its current business
      organization, keep available the services of its officers, employees and agents
      and maintain its relations and goodwill with subscribers, Owners, employees,
      agents and others having business relationships with any Seller;

     

    (c)  Confer
      with Purchaser prior to implementing operational decisions of a material nature
      with respect to the Business or the Assets;

     

    (d)  Otherwise
      report periodically to Purchaser concerning the status of the Business and
      each
      Seller’s operations and finances with respect thereto;

     

    (e)  Make
      no
      material changes in management personnel involved in the Business without prior
      consultation with Purchaser;

     

    (f)  Maintain
      the Assets in a state of repair and condition that complies with Legal
      Requirements and is consistent with the requirements and normal conduct of
      the
      Business, including, without limitation, the requirements under the ROE
      Agreements;

     

    (g)  Keep
      in
      full force and effect, without amendment, all material rights relating to each
      Sellers’ Business;

     

    (h)  Comply
      with all Legal Requirements and contractual obligations applicable to the
      operations of each Seller’s Business;

     

    (i)  Continue
      in full force and effect the Insurance;

     

    (j)  Except
      as
      required to comply with ERISA or to maintain qualification under Section 401(a)
      of the Code, not amend, modify or terminate any Employee Plan without the
      express written consent of Purchaser, and except as required under the
      provisions of any Employee Plan, not make any contributions to or with respect
      to any Employee Plan without the express written consent of Purchaser, provided
      that the Sellers shall contribute that amount of cash to each Employee Plan
      necessary to fully fund all of the benefit liabilities of such Employee Plan
      on
      a plan termination basis as of the Closing Date; 

     

    (k)  Maintain
      all books and records of each Seller relating to the Business in the ordinary
      course of business;

     

    (l)  Notify
      Purchaser within seventy-two (72) hours after receiving or becoming aware of
      any
      indication of interest, solicitation or discussions between any Seller and
      any
      system operator in California or Arizona with respect to any acquisition, sale
      or joint venture of such system operator’s assets in whole or in part;
      and

     

    (m)  Cease
      negotiating or discussing any new, or renewal of any, right of entry or service
      and installation or similar agreement with any owner or manager of a real
      property desiring to secure the services of any Seller in connection with its
      Private Cable Operator Business and provide Purchaser with notice of any such
      requests or expressions of interest for such negotiations or discussions within
      seventy-two (72) hours of any Seller becoming aware of same. 

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

     

    5.4  Negative
      Covenant.
      Except
      as otherwise expressly permitted herein, between the date of this Agreement
      and
      the Closing Date, neither Seller shall (a) take any affirmative action, or
      fail
      to take any reasonable action within its control, as a result of which any
      of
      the changes or events listed in Section
      3.16
      would be
      likely to occur; (b) make any modification to any material Contract; (c) fail
      to
      take any action to maintain the Systems at any of the ROE Properties in working
      order; (d) fail to respond to any service calls from subscribers at any of
      the
      ROE Properties or otherwise permit the service level of performance by any
      Seller with respect to the Assets to decline below the standard level of service
      provided by such Seller and consistent with past practice; or (d) enter into
      any
      compromise or settlement of any litigation, proceeding or governmental
      investigation relating to the Assets, the Business or the Assumed
      Liabilities.

     

    5.5  Consents.
      Each
      Seller shall cooperate with Purchaser and its representatives in obtaining
      all
      the Consents required to effect the transactions contemplated by this
      Agreement.

     

    5.6  Notification.
      Between
      the date of this Agreement and the Closing, each Seller shall promptly notify
      Purchaser in writing if it becomes aware of (a) any fact or condition that
      causes or constitutes a breach of any of the Sellers’ representations and
      warranties made as of the date of this Agreement or (b) the occurrence after
      the
      date of this Agreement of any fact or condition that would or would be
      reasonably likely to (except as expressly contemplated by this Agreement) cause
      or constitute a breach of any such representation or warranty had the
      representation or warranty been made as of the time of the occurrence of, or
      either Seller’s discovery of, such fact or condition. Should any such fact or
      condition require any change to the Disclosure Schedules specifying such change,
      such delivery shall not affect any rights of Purchaser under Section
      8.2
      and
Article
      9.
      During
      the same period, each Seller shall promptly notify Purchaser of the occurrence
      of any breach of any covenant of the Sellers in this Article
      5
      or of
      the occurrence of any event that may make the satisfaction of the conditions
      in
Article
      6
      impossible of unlikely.

     

    5.7  No
      Negotiation.
      Until
      such time as this Agreement shall be terminated pursuant to Section
      8.1 with
      respect to all the Assets, neither Seller shall directly or indirectly solicit,
      initiate, encourage or entertain any inquiries or proposals from, discuss or
      negotiate with, provide any nonpublic information to or consider the merits
      of
      any inquiries or proposals from any Person (other than Purchaser) relating
      to
      any business combination transaction involving any Seller or the sale of such
      Seller’s Business or any of the Assets. The Sellers shall notify Purchaser of
      any such inquiry or proposal with twenty-four (24) hours of receipt or awareness
      of the same by either Seller.

     

    5.8  Updated
      Financial Information Reports.
      Until
      the Closing Date, each Seller shall deliver to Purchaser within twenty (20)
      days
      after the end of each month a copy of the balance sheet and income statements
      for such month prepared in a manner containing information consistent with
      such
      Seller’s current practices and certified by such Seller’s chief financial
      officer as to compliance with Section
      3.5. In
      addition, within five (5) days after the end of each month the Sellers shall
      deliver to Purchaser each of the following in the same form as presented in
      the
      Disclosure Schedules: the DirecTV Residual Report (Schedule 3.21), the Bulk
      SMATV Gross Revenues and Direct Costs (Schedule 3.30), the Bulk Digital Gross
      Revenues and Direct Costs (Schedule 3.31), Owner Commissions (Schedule 3.25),
      DirecTV PPC Reports (Schedule 3.33), Payroll (Schedule 3.34) and SMATV Non-Bulk
      Service and DTH Non-Bulk Gross Revenues and Direct Costs (Schedule
      3.9).

     

    
      
        
        

      

      
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    5.9  Payment
      of Liabilities.
      Each
      Seller shall pay, make adequate provision for the payment of, or otherwise
      satisfy in the ordinary course of business all of its liabilities and
      obligations, including, without limitation, all Retained Liabilities. If any
      such liabilities or obligations are not so paid, provided for or otherwise
      satisfied, or if Purchaser reasonably determines that the failure to make any
      payments will impair Purchaser’s use or enjoyment of the Assets or the conduct
      of the Business with the Assets, Purchaser may, at any time after the Closing
      Date, elect to make all such payments directly (but shall have no obligation
      to
      do so) and deduct the full amount of all such payments from the Indemnity
      Holdback Amount.

     

    5.10  Employees
      and Employee Benefits.
      For
      the
      purpose of this Agreement, the term “Active Employees” shall mean all employees
      listed on Schedule
      3.34
      who are
      employed on the Closing Date by any Seller, including employees on temporary
      leave of absence, including family medial leave, military leave, temporary
      disability or sick leave, but excluding employees on long-term disability
      leave.

     

    (a)  Purchaser
      is not obligated to hire any Active Employee but may interview all Active
      Employees. Purchaser will provide Sellers with a list of Active Employees to
      whom Purchaser has made an offer of employment that has been accepted to be
      effective on the Closing Date (the “Hired Active Employees”). Subject to Legal
      Requirements, Purchaser will have reasonable access to the facilities and
      personnel records (including performance appraisals, disciplinary actions,
      grievances and medical records) of each Seller for the purpose of preparing
      for
      and conducting employment interviews with all active Employees and will conduct
      the interviews as expeditiously as possible prior to the Closing Date. Each
      Seller will provide access upon reasonable prior notice during normal business
      hours. Effective immediately before the Closing, each Seller will terminate
      the
      employment of all of its Hired Active Employees.

     

    (b)  Neither
      of the Sellers nor their Affiliates or related shareholders, members, managers,
      directors, officers or others in a similar capacity affiliated with the Sellers
      or any of their Affiliates (collectively, “Related Persons”) shall solicit the
      continued employment of any Active Employee (unless and until Purchaser has
      informed Sellers in writing that the particular Active Employee will not receive
      any employment offer from Purchaser) or the employment of any Hired Active
      Employee after the Closing. Purchaser shall inform Sellers promptly of the
      identities of those Active Employees to whom it will not make employment
      offers.

     

    (c)  It
      is
      understood and agreed that (i) Purchaser’s expressed intention to extend offers
      of employment as set forth in this Section 5.10
      shall
      not constitute any commitment, Contract or understanding (express or implied)
      of
      any obligation on the part of Purchaser to a post-Closing employment
      relationship of any fixed term or duration or upon any terms or conditions
      other
      than those that Purchaser may establish pursuant to individual offers of
      employment, and (ii) employment offered by Purchaser is “at will” and may be
      terminated by Purchaser or by an employee at any time for any reason (subject
      to
      any written commitments to the contrary made by Purchaser or an employee and
      Legal Requirements). Nothing in this Agreement shall be deemed to prevent or
      restrict in any way the right of Purchaser to terminate, reassign, promote
      or
      demote any of the Hired Active Employees after the Closing or to change
      adversely or favorably the title, powers, duties, responsibilities, functions,
      locations, salaries, other compensation or terms or conditions of employment
      of
      such employees. 

     

    
      
        
        

      

      
        -29-

        
          

        

      

      
        
        

      

    

     

    (d)  Each
      Seller shall be responsible for (i) the payment of all wages and other
      remuneration due to Active Employees with respect to their services as employees
      of such Seller through the Closing Date, including pro rata bonus payments
      and
      all vacation pay earned prior to the Closing Date; (ii) the payment of any
      termination or severance payments and the provision of health plan continuation
      coverage in accordance with the requirements of COBRA and Sections 601 through
      608, inclusive, of ERISA; and (iii) any and all payments to employees required
      under the WARN Act.

     

    (e)  Sellers
      shall be liable for any claims made or incurred by Active Employees and their
      beneficiaries through the Closing Date under the Employee Plans. For purposes
      of
      the immediately preceding sentence, a charge will be deemed incurred, in the
      case of hospital, medical or dental benefits, when the services that are the
      subject of the charge are performed and, in the case of other benefits (such
      as
      disability or life insurance), when an event has occurred or when a condition
      has been diagnosed that entitles the employee to the benefit.

     

    (f)  All
      Hired
      Active Employees who are participants in Sellers’ retirement plans shall retain
      their accrued benefits under Sellers’ retirement plans as of the Closing Date,
      and Sellers (or Sellers’ retirement plans) shall retain sole liability for the
      payment of such benefits as and when such Hired Active Employees become eligible
      therefore under such plans. All Hired Active Employees shall become fully vested
      in their accrued benefits under Sellers’ retirement plans as of the Closing
      Date, and Sellers will so amend such plans if necessary to achieve this result.
      Sellers shall cause the assets of each Employee Plan to equal or exceed the
      benefit liabilities of such Employee Plan on a plan-termination basis as of
      the
      close of business on the Closing Date.

     

    (g)  Sellers
      will cause their savings plan to be amended in order to provide that the Hired
      Active Employees shall be fully vested in their accounts under such plan as
      of
      the Closing Date and all payments thereafter shall be made from such plan as
      provided in the plan.

     

    (h)  Neither
      of the Sellers nor their respective Related Persons will make any transfer
      of
      pension or other employee benefit plan assets to Purchaser. Purchaser shall
      not
      have any responsibility, liability or obligation, whether to Active Employees,
      former employees, their beneficiaries or to any other Person, with respect
      to
      any employee benefit plans, practices, programs or arrangements (including
      the
      establishment, operation or termination thereof and the notification and
      provision of COBRA coverage extension) maintained by Sellers. Each Seller shall
      be solely liable for any severance payment required to be made to its employees
      due to the transactions contemplated under this Agreement.

     

    (i)  Purchaser
      will set its own initial terms and conditions of employment for the Hired Active
      Employees and others it may hire, including, work rules, benefits and salary
      and
      wage structure, all as permitted by law. Each Seller, as applicable, shall
      provide Purchaser with completed I-9 forms and attachments with respect to
      all
      Hired Active Employees.

     

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

     

    (j)  Each
      of
      the Sellers and Purchaser shall give any notices required by Legal Requirements,
      shall provide each other with such plan documents and summary plan descriptions,
      employee data or other information and shall take whatever other actions with
      respect to the plans, programs and policies described in this Section
      5.10, as,
      in
      each case, may be reasonably required to carry out the arrangements described
      in
      this Section
      5.10.

     

    (k)  If
      any of
      the arrangements described in this Section
      5.10 are
      determined by the IRS or other governmental body to be prohibited by law, each
      of the Sellers and Purchaser shall modify such arrangements to as closely as
      possible reflect their expressed intent and retain the allocation of economic
      benefits and burdens to the parties contemplated herein in a manner that is
      not
      prohibited by law.

     

    5.11  System
      Operators.
      Sellers
      shall notify Purchaser within seventy-two (72) hours after being entitled to
      acquire any system operator’s assets located in California or Arizona either
      upon a system operator’s default or otherwise or after becoming aware of any
      expression of interest from a system operator regarding such operator’s desire
      to sell or otherwise dispose of all or part its assets to either Seller (each,
      a
“SO Offer”). For a period of three (3) years following the Closing, each Seller
      agrees to provide Purchaser with a right of first refusal regarding any SO
      Offer
      in California or Arizona. Purchaser shall have a period of ninety (90) days
      after receipt of notice regarding any SO Offer to attempt to negotiate the
      acquisition of such system operator’s assets, provided, however, that if such
      Seller is unable to assign such SO Offer directly to Purchaser, such Seller
      shall undertake such negotiations directly on behalf of Purchaser in order
      to
      acquire the assets in such SO Offer to be resold or otherwise assigned to
      Purchaser. If a Seller undertakes such negotiations, it shall proceed based
      on
      terms and conditions acceptable to Purchaser in Purchaser’s sole discretion.
      Upon concluding any such acquisition, such Seller shall take all actions
      necessary to assign such assets to Purchaser on the same terms and conditions
      as
      acquired by Seller and approved by Purchaser. If Purchaser decides not to pursue
      any SO Offer or if Purchaser’s discussions regarding any potential acquisition
      from a Seller’s system operator cease completely, then following receipt of
      notice of same from Purchaser, such Seller shall have the opportunity to acquire
      such assets for a period of sixty days (60) days following the date of such
      notice. Thereafter, any potential acquisition of the assets of such system
      operator shall be subject to the right of first refusal with respect to each
      SO
      Offer described in this Section
      5.11.
      

     

    5.12  Further
      Assurances; Sellers Access to Records.
      At such
      time and from time to time on and after the Closing Date upon request by
      Purchaser, each Sellers shall do, execute, acknowledge and deliver, or cause
      to
      be done, executed, acknowledged and delivered, all such further acts, deeds,
      assignments, transfers, conveyances, powers of attorney, and assurances that
      may
      reasonably be required for the better conveying, transferring, assigning,
      delivering and confirming ownership to, or reducing to the possession of,
      Purchaser all of the Assets and to otherwise carry out the purposes of this
      Agreement. Each Seller agrees to promptly deliver, remit or return to Purchaser
      all Assets and amounts received by it after the Closing that, pursuant to the
      terms hereof, are owned by or are due to Purchaser. Purchaser shall permit
      each
      of the Sellers and their authorized representatives to have reasonable access
      to, on a confidential basis, and to copy, at such Seller’s expense, during
      regular business hours and upon reasonable advance
      notice to Purchaser and in a manner nondisruptive to Purchaser’s conduct of its
      business, such books, records and documents related to the Assets that are
      reasonably necessary for such Seller to comply with any applicable law or
      regulation or to respond to any legal or administrative claim or
      investigation.

     

    
      
        
        

      

      
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    5.13  Taxes,
      Reports and Returns.
      Each
      Seller shall pay any and all Taxes, including, without limitation, sales or
      transfer taxes in connection with the sale of its Assets, through the Closing
      Date.
      Each
      Seller shall promptly prepare and file all reports and returns required by
      Legal
      Requirements relating to the Business and its Assets as of the Closing Date.
      

     

    5.14  Maintenance
      of Property Relations.
      Up to
      and including the Closing Date, each Seller shall take all actions necessary
      to
      preserve the goodwill and relationship with the Owner, the property management
      team and the tenants at each ROE Property for the benefit of
      Purchaser. 

     

    5.15  Compliance
      with Conditions.
      Each
      Seller shall use its commercially reasonable best efforts to bring about the
      satisfaction of the conditions to the obligations of Purchaser specified in
      Article
      6
      below.

     

    5.16  Use
      of
      Tradename.
      From
      the Closing through March 31, 2007, each Seller agrees to permit Purchaser
      to
      use the name “Multiband Corporation” and “Rainbow Satellite Group, LLC”, as
      applicable, solely as necessary to effect the completion of the transition
      of
      the Assets from such Seller to Purchaser, provided that Purchaser shall not
      hold
      itself out as conducting business under either the “Multiband Corporation” or
“Rainbow Satellite Group, LLC” names. 

     

    5.17  Accounts
      Receivable.
      Each
      Seller and Purchaser agree that all accounts receivable collections shall be
      allocated to either the respective Seller or the Purchaser based on the period
      to which such accounts receivable relate and prorated as necessary to reflect
      any amounts attributable to periods prior to the Closing Date and to periods
      on
      and after the Closing Date. All accounts receivable for periods ending prior
      to
      the Closing Date, including, prepaid programming commissions and commissions
      payable to Sellers pursuant to the DirecTV Residual Report for periods ending
      prior to the Closing Date and all fees with respect to Bulk Service, SMATV
      Non-Bulk Service and receivers invoiced prior to the Closing Date for periods
      prior to the Closing Date (the “Pre-Closing A/R”), shall be for the account of
      Sellers. All accounts receivable with respect to the Assets for periods ending
      on or after the Closing Date, including, without limitation, prepaid programming
      commissions and commissions payable to Sellers pursuant to the DirecTV Residual
      Report for periods ending on or after the Closing Date and all fees with respect
      to Bulk Service, SMATV Non-Bulk Service and receivers invoiced prior to the
      Closing Date for periods on or after the Closing Date (the “Post-Closing A/R”),
      shall be for the account of Purchaser. Each of the Sellers agree to remit to
      Purchaser any Post-Closing A/R and Purchaser agrees to remit to Multiband,
      as
      agent for the Sellers, any Pre-Closing A/R. All such remittances of accounts
      receivable shall be made by the applicable party to the other party within
      five
      (5) days of receipt; provided, however, that Sellers shall provide Purchaser
      with daily email update of any Post-Closing A/R collections. For purposes of
      this Section 5.17, Rainbow hereby appoints Multiband as its agent for purposes
      of receiving any Pre-Closing A/R remitted by Purchaser to Rainbow.
      Notwithstanding the foregoing, any accounts receivable with respect to the
      Schedule 2.4 ROE Assets for periods arising on or after the Schedule 2.4 Assets
      Effective Date shall be for the account of Purchaser and any accounts receivable
      with respect to the Schedule 2.4 ROE Assets for periods arising on or prior
      to
      the Schedule 2.4 Assets Effective Date shall be for the account of Rainbow.
      All
      such accounts receivable with respect to the Schedule 2.4 ROE Assets shall
      be
      handled in accordance with the terms described above for the Post-Closing A/R
      and the Pre-Closing A/R but taking into account the Schedule 2.4 Assets
      Effective Date.

     

    
      
        
        

      

      
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    5.18  Noncompetition
      Agreements.
      Sellers
      shall bear all costs necessary to secure each of the Noncompetition Agreements
      described in Section
      6.18 below.

     

    5.19  Mutual
      Cooperation.
      Purchaser and each Seller agree to mutually cooperate in good faith with each
      other in connection with Sellers’ efforts to obtain each New ROE in the name of
      the respective Seller as required pursuant to Section
      6.6
      below.
      In connection with such good faith cooperation, Purchaser shall use its
      marketing representatives to assist in negotiating and securing the New ROEs,
      provided, however, that the wages (excluding Sales Commissions due with respect
      to the New ROEs) payable to Purchaser’s marketing representatives (the “Wages”)
      shall be the only cost incurred by Purchaser in connection with Sellers’
obligations under Section
      6.6
      below.

     

    5.20  Right
      of First Refusal to Sell New ROEs.
      In the
      event that for any reason the Closing does not occur, both Sellers agree that
      for a period of one year following the date of termination of this Agreement
      with respect to the Assets (other than the Assets relating to the Schedule
      2.4
      ROE Assets) Purchaser shall have a right of first refusal to purchase any New
      ROE at a purchase price that yields the Minimum Purchaser IRR as of the Closing
      based on the Closing Date Cash Flow and the Weighted Average Remaining ROE
      Agreement Term of the New ROEs to be purchased. Such right of first refusal
      may
      be exercised with respect to any or all New ROEs upon written notice by
      Purchaser to Sellers identifying the New ROEs to be purchased and specifying
      the
      calculation of the purchase price to be paid for the New ROEs to be purchased.
      Sellers agree to sell to Purchaser the New ROEs specified in the notice
      delivered by Purchaser at the purchase price specified therein. The closing
      of
      any such purchase shall occur within thirty (30) days after the date of the
      notice delivered by Purchaser.

     

    ARTICLE
      6

    CONDITIONS
      TO PURCHASER’S OBLIGATIONS

     

    The
      obligations of Purchaser under this Agreement (except with respect to the
      Initial Closing pursuant to Section
      2.7
      hereof)
      shall, at its option, be subject to the satisfaction, prior to the Closing
      Date,
      of all of the following conditions:  

     

    6.1  Representations,
      Warranties, Covenants and Agreements.
      Each of
      the Sellers’ representations and warranties in this Agreement (considered
      collectively), and each of these representations and warranties (considered
      individually), shall have been accurate in all material respects as of the
      date
      of this Agreement, and shall be accurate in all material respects as of the
      time
      of the Closing as if then made, without giving effect to any supplement to
      the
      Disclosure Schedules. Each Seller’s representations and warranties in
Sections
      3.3 and
      3.5, and
      each
      of the representations and warranties in this Agreement that contains an express
      materiality qualification, shall have been accurate in all respects as of the
      time of the Closing as if then made, without giving effect to any supplement
      to
      the Disclosure Schedules. Sellers shall have delivered to Purchaser a
      certificate dated as of the Closing Date to all such effects. 

     

    
      
        
        

      

      
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    6.2  Sellers
      Performance.
      All of
      the covenants and obligations that the Sellers are required to perform or to
      comply with pursuant to this Agreement at or prior to the Closing (considered
      collectively), and each of these covenants and obligations (considered
      individually), shall have been duly performed and complied with by the Closing
      Date. Sellers shall have delivered to Purchaser a certificate dated as of the
      Closing Date to all such effects. 

     

    6.3  Legislation.
      No
      statute, rule, regulation, order or interpretation shall have been enacted,
      entered or deemed applicable by any domestic government or governmental or
      administrative agency or court that would make the transactions contemplated
      by
      this Agreement illegal or that would cause Purchaser or any Affiliate or Related
      Person of Purchaser to suffer any adverse consequence.

     

    6.4  Proceedings.
      There
      shall not have been commenced or threatened against any Seller, or to the
      Knowledge of Sellers, commenced or threatened against Purchaser or any Owner
      any
      proceeding (i) involving any challenge to, or seeking damages or other relief
      in
      connection with, any of the transactions contemplated by this Agreement or
      (ii)
      that may have the effect of preventing, delaying, making illegal, imposing
      limitations or conditions on or otherwise interfering with the transactions
      contemplated by this Agreement.

     

    6.5  Employees.
      All
      requisite notice periods under the WARN Act and California’s equivalent
      provision shall have expired. Purchaser shall have entered into an employment
      agreement with David Nelson on terms and conditions reasonably acceptable to
      Purchaser. Substantially all Active Employees of Sellers shall be available
      for
      hiring by Purchaser, in its sole discretion, on and as of the Closing
      Date.

     

    6.6  New
      Exclusive ROE Agreements.
      Receipt
      by Purchaser of new fully executed Right of Entry Agreements for each ROE
      Property on Schedule
      3.5(d) with
      a
      Closing Date Gross Margin over one thousand dollars ($1,000) per month (and
      which is highlighted in bold black typeface on Schedule
      3.5(d))
      (the
“New ROEs”) on form agreements provided by Purchaser, but in the name of the
      appropriate Seller, and which provide for terms and conditions that are
      acceptable to Purchaser, including, without limitation, a minimum term of ten
      (10) years and an exclusive right to provide digital satellite, SMATV and
      broadband services and to market such services at such property, with all costs
      (including any Sales Commissions payable to Purchaser’s marketing
      representatives, but excluding the Wages) incurred in connection with securing
      such New ROEs paid by Sellers on or prior to the Closing. 

     

    6.7  Intentionally
      Omitted.

     

    6.8  Consents.
      Receipt
      by Purchaser of each of the Consents set forth on Schedule
      3.19 on
      forms
      reasonably acceptable to Purchaser, but excluding any Consent with respect
      to an
      ROE Property for which a New ROE is required pursuant to Section
      6.6 above.

     

    6.9  Call
      Center and Billing Services.
      Each
      Seller and Purchaser agree to enter into that certain Call Center and Billing
      Services Agreement on terms and conditions mutually agreeable to Purchaser
      and
      Multiband (the
      “Call Center and Billing Agreement”),
      which
      Call Center and Billing Agreement will provide, inter
      alia,
      that
      (a) Sellers shall provide Purchaser with customer center call service and
      billing services, (b) such services shall be billed to Purchaser at the rate
      of
      three dollars ($3.00) for each Subscriber, (c) Purchaser may add or remove
      any
      ROE Property or any other property specified by Purchaser upon ten (10) days
      prior written notice to Sellers, (d) minimum performance standards that equal
      or
      exceed those of Purchaser’s call center or the requirements set forth in
      Purchaser’s DirecTV MDU Key Account Operator Agreement, dated March 31, 2006,
      and (e) all payments received or collected by Seller’s on behalf of Purchaser
      pursuant to the billing services arrangement shall be received and deposited
      into a lockbox account established by Purchaser.

     

    
      
        
        

      

      
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    6.10  Internet
      Services Agreement.
      Multiband and Purchaser agree to enter into that center Internet Services
      Agreement on terms and conditions mutually agreeable to Purchaser and Multiband
      (the “Internet Agreement”), which Internet Agreement will provide, inter
      alia,
      that
      (a) within thirty (30) days after the Closing, Purchaser shall provide to
      Multiband a list of twenty properties at which Purchaser has the right to
      provide Internet services pursuant to right of entry agreements and Purchaser
      shall commit to use Multiband’s Internet service solution to launch the Internet
      service required to be delivered by Purchaser at such properties at such time
      as
      Purchaser is prepared to launch such properties, (b) Multiband agrees that
      the
      Internet service it provides to Purchaser will consist of a minimum of 10
      megabits/second of bandwidth, (c) such services shall be billed to Purchaser
      at
      Multiband’s then current cost which is represented as of the Closing to comprise
      a $2500.00 one-time installation fee for each property at which Purchaser
      requests 10 megabits/second of bandwidth or a $3500.00 one-time installation
      fee
      for each property at which Purchaser requests 45 megabits/second of bandwidth,
      in each case, including installation of all wireless devices and repair and
      maintenance of such wireless devices for the duration of the term of the
      Internet Agreement, a $300.00 monthly circuit fee for each property receiving
      the services, and a $4.00 monthly fee for each internet subscriber using such
      service at each property, subject to mutually agreed to changes should
      Multiband’s cost structure change, (d) the initial term of the Internet
      Agreement will be three (3) years, (e) upon Purchaser’s request, Multiband shall
      provide Purchaser with Internet connectivity service to residents at any
      property that is serviced by Purchaser during the term of the Internet
      Agreement, (f) Multiband agrees to comply with performance standards that are
      at
      least comparable to, if not better than, the performance standards of
      Purchaser’s existing Internet service solution providers, and (g) Purchaser may
      request or cancel Internet service with respect to any property at anytime
      upon
      ten (10) days prior written notice to Multiband. 

     

    6.11  Technical
      Specifications.
      Receipt
      by Purchaser at least ten (10) days prior to the Closing, of a correct and
      complete list of the technical specifications for each ROE Property, including,
      without limitation, the type of delivery system (SMATV, L-Band, HDTV, MFH1,
      etc), whether it has digital service, whether it has Internet service, the
      bandwidth, the applicable Seller’s Property Number, headend name and repeater
      name.

     

    6.12  Owner
      Contact Information.
      Receipt
      by Purchaser on or before October 27, 2006, of the most currently available
      name, address, telephone number and email address for each Owner of an ROE
      Property, Owner’s management company, Owner’s onsite managers and asset
      portfolio or equivalent managers that work for the Owner or the Owner’s
      management company. Receipt by Purchaser at least ten (10) days prior to the
      Closing, of a correct and complete electronic list of the most currently
      available name, address, telephone number and email address for each Owner
      of an
      ROE Property, Owner’s management company, Owner’s onsite managers and asset
      portfolio or equivalent managers that work for the Owner or the Owner’s
      management company and detailed supporting calculations for the Owner
      Commissions paid or to be paid consistent with past practice by each Seller
      for
      the period from October through December 31, 2006 for ROE Agreements with
      quarterly payment
      terms and for the month ended December 31, 2006 for ROE Agreements with monthly
      payment terms.

     

    
      
        
        

      

      
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    6.13  Deposits.
      Receipt
      by Purchaser of a correct and complete report as of the Closing, identifying
      the
      name and address (including unit number) of each Subscriber at an ROE Property
      who has provided a credit card to Sellers as security for each of such
      subscriber’s deposit obligations, and a correct and complete report as of the
      Closing identifying the name and address (including unit number) of each
      Subscriber at an ROE Property who pays Sellers for their services by other
      than
      a paper check.

     

    6.14  Free
      (“Comp”) Accounts and Service.
      Receipt
      by Purchaser of a correct and complete list by ROE Property of the number and
      type of free “comp” accounts provided by each Seller to each ROE Property under
      the terms of each ROE Agreement or otherwise, to what locations on the ROE
      Property such free accounts are provided and the type of service and any
      specific customer premise equipment provided. 

     

    6.15  Deposits.
      Receipt
      by Purchaser of a correct and complete summary of all deposits due and owing
      to
      Subscribers or Owners that are held by each Seller as of the Closing, including,
      without limitation, deposits with respect to any customer premise equipment,
      deposits with respect to the provision of Bulk SMATV Service or Bulk Digital
      Service and the terms under which such deposits are refundable (the “Cash
      Deposits”). 

     

    6.16  Channel
      Lineups and Serial Numbers.
      Receipt
      by Purchaser of a correct and complete listing of the channel
      lineups and the receiver serial number/access and number for each channel in
      the
      lineup at each ROE Property, together with prices relative to each programming
      package at each ROE Property, as in effect on the Closing Date, a notation
      as to
whether
      or not the
      Systems are delivering the channel lineups as set forth in the information
      delivered to Purchaser hereunder and as to whether such channel lineups are
      in
      fact available and fully functional at each ROE Property. 

     

    6.17  ROE
      Agreement and Subscriber Information.
      Receipt
      by Purchaser of (a) the ROE Files;
      (b)
      correct and complete files of each Seller’s Subscriber records for the
      Subscribers included in the Assets, including, without limitation, the address,
      unit number, type of services subscribed to and amounts and descriptions of
      any
      deposits held by each Seller with respect to each subscriber; and
      (c) a
      correct and complete electronic listing of all unit labeling information for
      each ROE Property; provided, however, that the general Subscriber information
      and unit labeling information shall each be provided in an electronic format
      suitable for uploading into Purchaser’s customer database system.

     

    6.18  Noncompetition
      Agreements.
      Receipt
      by Purchaser of a fully executed Noncompetition, Nonsolicitation and
      Nondisclosure Agreement on terms and conditions mutually agreed to by Purchaser,
      and each of the Sellers and the following principals of Multiband, respectively:
      (a) James Mandel, Chief Executive Officer, (b) Steve Bell, Chief Financial
      Officer, (c) Kent Whitney, Chief Operating Officer, and (d) David Ekman, Chief
      Information Officer (collectively, the “Noncompetition Agreements”), including,
      without limitation, a minimum term of five (5) years from the Closing for each
      Seller and a minimum term of two (2) years from the Closing for each individual
      listed in subsections (a) through (d) above, and in each case extending the
      benefits of the noncompetition provisions to Purchaser and its Affiliates in
      the
      states of California and Arizona.
      In
      addition, the Noncompetition Agreements with respect to the Sellers will exclude
      from the prohibition against competition, the Sellers existing system operators
      as of the date of this Agreement and will specifically provide that Sellers’
provision of call center and billing services to third parties and their
      provision of internet services to their system operator network and Purchaser
      shall not be deemed to be competition with Purchaser provided, however, that
      Sellers do not provide internet services directly to residents at any ROE
      Property within the territory of California or Arizona.

     

    
      
        
        

      

      
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    6.19  Enforcement
      of Existing Covenants.
      Each of
      the Sellers agree to reasonably cooperate with Purchaser to enforce the existing
      covenants not to compete that affect the Assets and upon request from Purchaser
      will assist in taking all action reasonably necessary to try to prevent James
      Zaphirou from soliciting any of the ROE Properties included in the Assets,
      including, without limitation, by providing written communications necessary
      to
      remind Mr. Zaphirou of his obligations regarding the Assets.

     

    6.20  Payoff
      Letters.
      A
      statement from each of (a) Dinamo Entertainment, Inc. (“Dinamo”) as holder of
      that certain Promissory Note dated as of August 26, 2005 executed by Multiband
      in the principal amount of six hundred thousand dollars ($600,000.00) in
      connection with that certain Cable System Acquisition Agreement by and between
      Multiband and Dinamo executed on or about August 31, 2005, and (b) Rand’M, a
      California corporation, as holder of that certain Promissory Note dated as
      of
      September 13, 2006 executed by Multiband in the principal amount of one hundred
      forty-six thousand, five hundred dollars ($146,500.00) in connection with that
      certain Cable Systems Acquisition Agreement by and between Multiband and Rand’M
      effective September 13, 2006, dated the Closing Date, setting forth the
      principal amount then outstanding on the indebtedness represented by each note,
      the interest rate thereon and a statement to the effect that Multiband, as
      obligor under such note, is not in default under any of the provisions
      thereof.

     

    6.21  Instruments
      of Transfer.
      Receipt
      by Purchaser of such instruments of transfer, assignment, conveyance and other
      instruments sufficient to convey, transfer and assign to Purchaser all right,
      title and interest in the Assets, together with possession of such Assets,
      all
      in form and substance reasonably satisfactory to Purchaser and its counsel,
      including, but not limited
      to, (a)
      an
      assignment for each ROE Agreement
      and (b)
a
      bill of
      sale, each in a form mutually agreed to among the parties.

     

    6.22  Lien
      Release.
      Receipt
      by Purchaser of evidence satisfactory to Purchaser and its counsel of the
      termination or nonexistence of any Liens with respect to the
      Assets.

     

    6.23  Transfer
      of Chain Numbers.
      Each
      Seller will sign and approve and secure DirecTV’s approval to transfer each ROE
      Agreement registered with DirecTV under a “PID” number listed on Schedule
      3.8(a) from
      such
      Seller’s chain number with DirecTV to Purchaser’s chain number with DirecTV.

     

    
      
        
        

      

      
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    6.24  Transfer
      of Accounts.
      Receipt
      of evidence satisfactory to Purchaser that each Seller’s account for services
      provided by 4COM and the Bulk Service and SMATV Non-Bulk Service accounts for
      services provided by DirecTV shall be transferred to Purchaser’s account as of
      the Closing. 

     

    6.25  DirecTV’s
      Waiver of Right of First Refusal.
      Receipt
      by Purchaser of a waiver from DirecTV in connection with DirecTV’s waiver of its
      right of first refusal that Multiband granted to DirecTV pursuant to its
      agreement with DirecTV. 

     

    6.26  Board
      and Lender Approvals.
      Receipt
      by Purchaser of all approvals required by Purchaser’s Board of Managers and its
      financial institutions lenders and of all approvals required by each Seller’s
      Board of Directors or Board of Managers, as applicable.

     

    6.27  Updated
      Disclosures.
      Receipt
      by Purchaser of each of the updated schedules and electronic lists and files
      required to be delivered to Purchaser pursuant to the terms of this Agreement,
      which updated schedules and electronic lists and files shall reflect information
      consistent with that previously presented to Purchaser and which does not result
      in a Material Adverse Effect with respect to the Assets considered as a
      whole.

     

    6.28  Secretary’s
      Certificate.
      Receipt
      by Purchaser of a certificate of the Secretary of each Seller (a) attaching
      true, correct and complete copies of all resolutions duly adopted by the Board
      of Directors or Managers of such Seller authorizing such Seller’s execution,
      delivery and performance of its obligations under this Agreement (and naming
      specific persons who are authorized to sign those documents on behalf of
      Seller), such Seller’s execution, delivery and performance of its obligations
      under all other agreements and documents, and the taking by such Seller of
      all
      other actions, in furtherance of the foregoing, which resolutions shall not
      have
      been altered, amended, modified or rescinded and shall remain in full force
      and
      effect on the Closing Date; (b) attaching true and complete copies of the
      charter documents (Articles of Incorporation and Bylaws or Articles of
      Organization and Operating Agreement, as applicable) of such Seller, which
      charter documents shall not have been altered, amended, modified or rescinded
      and shall remain in full force and effect on the Closing Date and (c) certifying
      as to the incumbency and signatures of the officers of such Seller that sign
      the
      Agreement and any other document delivered or to be delivered by such Seller
      pursuant to any of the foregoing.

     

    ARTICLE
      7

    CONDITIONS
      TO SELLERS’ OBLIGATIONS

     

    The
      obligations of the Sellers under this Agreement (except
      with respect to the Initial Closing pursuant to Section
      2.7
      hereof)
shall,
      at
      their option, be subject to the satisfaction, on or prior to the Closing Date,
      of all of the following conditions:

     

    7.1  Representations,
      Warranties, Covenants and Agreements.
      Each of
      the Purchaser’s representations and warranties in this Agreement (considered
      collectively), and each of these representations and warranties (considered
      individually), shall have been accurate in all material respects as of the
      date
      of this Agreement, and shall be accurate in all material respects as of the
      time
      of the Closing as if then made. Each of the Purchaser’s representations and
      warranties in Section
      4.2, and
      each
      of the Purchaser’s representations and warranties in this Agreement that
      contains an express materiality qualification, shall have been accurate in
      all
      respects as of the time of the Closing as if then made. Purchaser shall have
      delivered to Sellers a certificate dated as of the Closing Date to all such
      effects. 

     

    
      
        
        

      

      
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    7.2  Legislation.
      No
      statute, rule, regulation, order or interpretation shall have been enacted,
      entered or deemed applicable by any domestic government or governmental or
      administrative agency or court that would make the transactions contemplated
      by
      this Agreement illegal or that would cause Sellers or any Affiliate or Related
      Person of Sellers to suffer any adverse consequence.

     

    7.3  Proceedings.
      There
      shall not have been commenced or threatened against Purchaser, or to the
      Knowledge of Purchaser, commenced or threatened against any Seller or any Owner
      any proceeding (i) involving any challenge to, or seeking damages or other
      relief in connection with, any of the transactions contemplated by this
      Agreement or (ii) that may have the effect of preventing, delaying, making
      illegal, imposing limitations or conditions on or otherwise interfering with
      the
      transactions contemplated by this Agreement.

     

    7.4  Secretary’s
      Certificate.
      Receipt
      by Sellers of a certificate of the Secretary of Purchaser (a) attaching true,
      correct and complete copies of all resolutions duly adopted by the Board of
      Directors of Purchaser authorizing Purchaser’s execution, delivery and
      performance of its obligations under this Agreement (and naming specific persons
      who are authorized to sign those documents on behalf of Purchaser), Purchaser’s
      execution, delivery and performance of its obligations under all other
      agreements and documents, and the taking by Purchaser of all other actions,
      in
      furtherance of the foregoing, which resolutions shall not have been altered,
      amended, modified or rescinded and shall remain in full force and effect on
      the
      Closing Date; and (b) certifying as to the incumbency and signatures of the
      officers of Purchaser that sign the Agreement and any other document delivered
      or to be delivered by Purchaser pursuant to any of the foregoing.

     

    ARTICLE
      8

    TERMINATION

     

    8.1  Termination.
      By
      notice given prior to or at the Closing, subject to Section
      8.2,
      this
      Agreement may be terminated as follows:

     

    (a)  By
      Purchaser if a material breach of any provision of this Agreement has been
      committed by either Seller and such breach has not been waived by
      Purchaser;

     

    (b)  By
      Multiband if a material breach of any provision of this Agreement has been
      committed by Purchaser and such breach has not been waived by
      Multiband;

     

    (c)  By
      Purchaser if any condition in Article
      6
      has not
      been satisfied as of the date specified for the Closing in Section
      2.7 or
      if
      satisfaction of such a condition by such date is or becomes impossible (other
      than through the failure of Purchaser to comply with its obligations under
      this
      Agreement), and Purchaser has not waived such condition on or before such
      date;

     

    
      
        
        

      

      
        -39-

        
          

        

      

      
        
        

      

    

     

    (d)  By
      Multiband if any condition in Article
      7 has
      not
      been satisfied as of the date specified for the Closing in Section
      2.7 or
      if
      satisfaction of such a condition by such date is or becomes impossible (other
      than through the failure of either Multiband or Rainbow to comply with its
      obligations under this Agreement), and Multiband has not waived such condition
      on or before such date;

     

    (e)  By
      mutual
      consent of Purchaser and Multiband; and 

     

    (f)  By
      Purchaser if the Closing has not occurred on or before April 30, 2007, or such
      later date as the parties may agree upon, unless Purchaser is in material breach
      of this Agreement.

     

    8.2  Effect
      of Termination.
      Each
      party’s right of termination under Section
      8.1 is
      in
      addition to any other rights it may have under this Agreement or otherwise,
      and
      the exercise of such right of termination will not be an election of remedies.
      Unless the Initial Closing described in Section
      2.4
      hereof
      has not occurred, if this Agreement is terminated pursuant to Section
      8.1,
      all
      obligations of the parties under this Agreement will terminate, except that
      the
      obligations of the parties in this Section
      8.2 and
      Section
      5.1 and
      Article
      10
      (except
      for those in Section
      10.7)
      will
      survive, provided, however, that if this Agreement is terminated because of
      a
      breach of this Agreement by the nonterminating party or because one or more
      of
      the conditions to the terminating party’s obligations under this Agreement is
      not satisfied as a result of the party’s failure to comply with its obligations
      under this Agreement, the terminating party’s right to pursue all legal remedies
      will survive such termination unimpaired. If the Initial Closing described
      in
Section
      2.4
      hereof
      has occurred, then this Agreement may only be terminated with respect to the
      balance of the Assets, and this Agreement shall remain in full force and effect
      with respect to the Schedule 2.4 ROE Assets.

     

    ARTICLE
      9

    INDEMNIFICATION

     

    9.1  Indemnification.
      The
      Sellers, jointly and severally, will indemnify and hold harmless Purchaser,
      and
      its members, managers, officers, employees, agents, consultants, advisors,
      accountants, financial advisors, legal counsel and representatives and
      Affiliates (collectively, the “Purchaser Indemnitees”), and will reimburse the
      Purchaser Indemnitees for any loss, liability, claim, damage, interest and
      penalties, expense (including costs of investigation and defense and reasonable
      attorneys’ fees and expenses) or diminution of value, whether or not involving a
      Third-Party Claim (collectively, “Damages”) arising from or in connection with
      (a) any breach of any representation or warranty made by Sellers in (i) this
      Agreement (without giving effect to any update to the Disclosure Schedules
      required to be delivered by Sellers after the time of signing this Agreement),
      (ii) the Disclosure Schedules required to be delivered by Sellers, (iii) the
      updates to the Disclosure Schedules required to be delivered by Sellers, (iv)
      the certificate delivered pursuant to Section
      6.1,
      (v) any
      transfer instrument or (vi) any other certificate, document, writing or
      instrument delivered by Sellers pursuant to this Agreement; (b) any breach
      of
      any covenant or obligation of any Seller in this Agreement or in any other
      certificate, document, writing or instrument delivered by any of the Sellers
      pursuant to this Agreement; (c) any liability arising out of the ownership
      or
      operation of the Assets prior to the Closing Date other than the Assumed
      Liabilities; (d) any claim by any Person for brokerage or finder’s fees or
      commissions or similar payments based upon any agreement or understanding made,
      or alleged to have been made, by any Person with any Seller in connection with
      the transactions contemplated by this Agreement; (e) any liability under the
      WARN Act or any similar state or local Legal Requirement that may result from
      an
“Employer Loss”, as defined by 29 U.S.C. § 2101(a)(6), caused by any action of
      the Sellers prior to the Closing or by Purchaser’s decision not to hire previous
      employees of any Seller; (f) any Employee Plan established or maintained by
      any
      Seller; (g) any obligation to share any of the proceeds received by any Seller
      under this Agreement pursuant to the term of any of the ROE Agreements; (g)
      any
      costs incurred in connection with enforcing any noncompetition provision to
      which Morris Eiseman or the prior owners of the Rainbow Assets is bound (the
      “Prior Noncompetes”); (h) any costs incurred in connection with securing any New
      ROE or other new Right of Entry Agreement if such costs are incurred as a result
      of a breach of the Prior Noncompetes; (i) the costs to upgrade any ROE Property
      required to be covered by a New ROE pursuant to Section 6.6 hereof to MFH1
      technology pursuant to Purchaser’s specifications from the Closing Date to the
      Earnout Date and (j) the Retained Liabilities. 

     

    
      
        
        

      

      
        -40-

        
          

        

      

      
        
        

      

    

     

    9.2  Indemnification
      of Sellers.
      Purchaser will indemnify and hold harmless the Sellers and each of their
      shareholders, members, managers, directors, officers, employees, agents,
      consultants, advisors, accountants, financial advisors, legal counsel,
      representatives and Affiliates (collectively, the “Sellers’ Indemnitees”), and
      will reimburse the Seller’s Indemnitees for any Damages arising from or in
      connection with (a) any breach of any representation or warranty made by
      Purchaser in (i) this Agreement or in any certificate, document, writing or
      instrument delivered by Purchaser pursuant to this Agreement; (b) any breach
      of
      any covenant or obligation of Purchaser in this Agreement or in any certificate,
      document, writing or instrument delivered by Purchaser pursuant to this
      Agreement; (c) any claim by any Person for brokerage or finder’s fees or
      commissions or similar payments based upon any agreement or understanding made,
      or alleged to have been made, by any Person with Purchaser in connection with
      the transactions contemplated by this Agreement and (d) any Assumed
      Liabilities.

     

    9.3  
      Third-Party Claims.
      If a
      claim by a third party is made against any indemnified party, and if the
      indemnified party intends to seek indemnity with respect thereto under this
      Article 9, such indemnified party shall promptly notify the indemnifying party
      of such claim; provided, however, that failure to give timely notice shall
      not
      affect the rights of the indemnified party except to the extent the indemnifying
      party has been prejudiced by such failure. 

     

    (a)  The
      indemnifying party shall be entitled to contest, settle or assume the defense
      of
      such claim, including the employment of counsel satisfactory to the indemnified
      party, as provided below. If the indemnifying party elects to contest, settle
      or
      defend such claim, it shall notify the indemnified party within 10 days of
      receipt of such claim (but in no event less than 15 days before any pleading,
      filing or response on behalf of the indemnified party is due) of its intent
      to
      do so. If the indemnifying party elects not to settle or defend such claim
      or
      fails to notify the indemnified party of its election within 10 days (or such
      shorter period provided above) after receipt of the indemnified party’s notice
      of a claim of indemnity hereunder, the indemnified party shall have the right
      to
      contest, settle or compromise the claim without prejudice to any rights to
      indemnification hereunder. Regardless of which party is controlling the
      settlement or defense of any claim, (i) both the indemnified party and
      indemnifying party shall act in good faith, (ii) the indemnifying party shall
      not thereby permit to exist any Lien upon any asset of any indemnified party
      or
      of its Affiliates or subsidiaries without the consent of the indemnified party,
      (iii) the indemnifying party shall permit the indemnified party to participate
      in such settlement or defense through counsel chosen by the indemnified party,
      provided that all fees, costs and expenses of such counsel in an action
      controlled by the indemnifying party shall be borne by the indemnified party,
      unless the indemnifying party and indemnified party have conflicting available
      defenses to such third-party claim, in which case such fees, costs and expenses
      shall be borne by the indemnifying party, (iv) no entry of judgment or
      settlement of a claim (a “Final Claim”) may be agreed to without the written
      consent of both the indemnified party and the indemnifying party, which consents
      shall not be unreasonably withheld, and (v) the indemnifying party shall agree
      promptly to reimburse the indemnified party for the full amount of such Final
      Claim pursuant to this Article 9, subject to the following sentence. So long
      as
      the indemnifying party is reasonably contesting any such claim in good faith
      as
      permitted herein, the indemnified party shall not pay or settle any such claim.
      The controlling party shall deliver, or cause to be delivered, to the other
      party copies of all correspondence, pleadings, motions, briefs, appeals or
      other
      written statements relating to or submitted in connection with the settlement
      or
      defense of any such claim, and timely notices of, and the right to participate
      pursuant to (iii) above in any hearing or other court proceeding relating to
      such claim.

     

    
      
        
        

      

      
        -41-

        
          

        

      

      
        
        

      

    

     

    (b)  Notwithstanding
      the foregoing, if the indemnified party determines in good faith that there
      is a
      reasonable probability that a third-party claim may adversely affect it or
      its
      Affiliates other than as a result of monetary damages for which it would be
      entitled to indemnification under this Agreement, the indemnified party may,
      by
      notice to the indemnifying party, assume the exclusive right to defend,
      compromise or settle such third-party claim at the indemnifying party’s sole
      expense, but the indemnifying party will not be bound by any determination
      of
      any third party claim so defended for the purposes of this Agreement or any
      compromise or settlement without its consent (which consent may not be
      unreasonably withheld). 

     

    9.4  Other
      Claims.
      A claim
      for indemnification for any matter not involving a Third-Party Claim may be
      asserted by notice to the party from whom indemnification is sought and shall
      be
      paid promptly after notice.

     

    9.5  Cooperation
      as to Indemnified Liability.
      Each
      party hereto shall cooperate fully with the other party with respect to access
      to books, records or other documentation within such party’s control, if deemed
      reasonably necessary or appropriate by either party in the defense of any claim
      that may give rise to indemnification hereunder, but in no event shall any
      party
      be required to waive any privilege to which it is entitled.

     

    
      
        
        

      

      
        -42-

        
          

        

      

      
        
        

      

    

     

    9.6  Limitations.

     

    (a)  Survival.
      The
      representations, warranties and indemnifications for breaches contained herein,
      and the covenants, agreements and indemnifications contained herein that are
      to
      have been fully performed prior to the Closing, shall survive the Closing,
      and
      remain in full force and effect until the first anniversary of the Closing
      and a
      party may not first raise a claim for Damages after such date not directly
      related to or arising out of a claim asserted by such party prior to the first
      anniversary of the Closing. No independent investigation made by a party hereto,
      or by its counsel or any of its agents or employees, shall in any way limit
      or
      restrict the scope of the representations, warranties, covenants or agreements
      made by another party in this Agreement.

     

    (b)  Exceptions.
      The
      first anniversary of the Closing limitation of Section
      9.6(a)
      above
      shall not apply to Damages resulting from, arising out of, or based upon (i)
      any
      fraud or intentional misrepresentation by any Seller or Purchaser; (ii) any
      failure by any Seller to deliver to Purchaser all Assets necessary or used
      in
      the conduct of the Business; (iii) any failure by any Seller to satisfy, perform
      or pay the liabilities of such Seller not included within the Assumed
      Liabilities; or (iv) a breach by either of the Sellers or Purchaser of any
      covenant or agreement to be performed by it after the Closing (collectively,
      subsections (i) through (iv) are referred to herein as the “Intentional
      Damages”).
      The
      Intentional Damages shall survive the Closing, and remain in full force and
      effect until the second anniversary of the Closing and a party may not first
      raise a claim for Intentional Damages after such date not directly related
      to or
      arising out of a claim asserted by such party prior to the second anniversary
      of
      the Closing; provided, however, that any limitation with respect to a covenant
      or agreement under subsection (iv) above whose performance extends beyond such
      second anniversary of the Closing shall survive until the expiration or
      termination of such covenant or agreement.

     

    9.7  Right
      of Setoff.
      Upon
      notice to Sellers specifying in reasonable detail the basis therefore, Purchaser
      may set off any amount to which it may be entitled under this Article
      9
      against
      amounts otherwise payable to Sellers. Neither the exercise of nor the failure
      to
      exercise such right of setoff will constitute an election of remedies or limit
      Purchaser in any manner in the enforcement of any other remedies that may be
      available to it.

     

    ARTICLE
      10

    MISCELLANEOUS

     

    10.1  Complete
      Agreement.
      The
      Schedules, Annexes and Exhibits to this Agreement shall be construed as an
      integral part of this Agreement to the same extent as if they had been set
      forth
      verbatim herein. This Agreement, the Schedules, Annexes and Exhibits hereto
      and
      other documents delivered pursuant to this Agreement constitute the entire
      agreement between the parties hereto with respect to the subject matter hereof
      and supersede all prior proposals, discussions, or agreements, whether written
      or oral, relating hereto. Any disclosure contained in any Schedule hereto shall
      be deemed included in each other applicable Schedule hereto but only to the
      extent the disclosure in such first Schedule is on its face clear, without
      the
      need of additional information or explanation, as to which, if any, other
      Schedule such disclosure should be deemed to be included and for what
      reason.

     

    10.2  Disclosure
      Schedules.
      The
      information in the Disclosure Schedules constitutes (i) exceptions to particular
      representations, warranties, covenant and obligations of Sellers as set forth
      in
      this Agreement or (ii) descriptions or lists of assets and liabilities and
      other
      items referred to in this Agreement. If there is any inconsistency between
      the
      statements in this Agreement and those in the Disclosure Schedules (other than
      exceptions expressly set forth as such in the Disclosure Schedules with respect
      to a specifically identified representation or warranty), the statements in
      this
      Agreement will control. The statements in the Disclosure Schedules and those
      in
      any supplement thereto, relate only to the provisions in the Section of this
      Agreement to which they expressly relate and not to any other provision in
      this
      Agreement.

     

    
      
        
        

      

      
        -43-

        
          

        

      

      
        
        

      

    

     

    10.3  Waiver,
      Discharge, Amendment, Etc.
      The
      failure of any party hereto to enforce at any time any of the provisions of
      this
      Agreement, including the election of such party to proceed with the Closing
      despite a failure of any condition to such party’s closing obligations to occur,
      shall in no way be construed to be a waiver of any such provision, nor in any
      way to affect the validity of this Agreement or any part thereof or the right
      of
      the party thereafter to enforce each and every such provision. No waiver of
      any
      breach of this Agreement shall be held to be a waiver of any other or subsequent
      breach. Any amendment to this Agreement shall be in writing and signed by the
      parties hereto.

     

    10.4  Fees
      and Expenses.
      Each of
      the parties hereto shall pay all fees and expenses incurred by it, including
      the
      fees of its respective counsel, brokers, attorneys, accountants, investment
      bankers and other experts incident to the negotiation and preparation of this
      Agreement and the consummation of the transactions contemplated by this
      Agreement.
      If this
      Agreement is terminated the obligation of each party to pay its own fees and
      expenses will be subject to any rights of such party arising from a breach
      of
      this Agreement by another party. 

     

    10.5  Notices.
      All
      notices or other communications to a party required or permitted hereunder
      shall
      be in writing and shall be given by hand delivery, courier service (with
      acknowledgement of receipt), telecopy (with confirmation of transmission),
      by
      reputable overnight carrier for next morning delivery provided recipient must
      sign for receipt, or by certified mail, postage prepaid with return receipt
      requested, addressed to the parties at the following addresses:

     

    
      	 	if to Sellers, to:	 	 
	 	 	 	 
	 	 	
              Multiband
                Corporation

              9449
                Science Center Drive

              New
                Hope Minnesota 55428

              Attention:
                Jim Mandel, Chief Executive Officer

              Facsimile:
                763-504-3060

            	 
	 	 	 	 
	 	With a copy to:	 	 
	 	 	
              Multiband
                Corporation

              9449
                Science Center Drive

              New
                Hope Minnesota 55428

              Attention:
                Steven Bell, Chief Financial Officer

              Facsimile:
                763-504-3060

            	 
	 	 	 	 
	 	and if to Purchaser, to:	 	 
	
            	 	 	 
	 	 	
              Consolidated
                Smart Broadband Systems, LLC

              620
                W. 135th Street

              Gardena,
                CA 90248

              Attention:
                Glenn S. Corey, Chief Financial Officer

              Facsimile:
                (310) 715-6371

            	 

    

     

    
      
        
        

      

      
        -44-

        
          

        

      

      
        
        

      

    

     

    
      	 	With a copy to:	 	 
	 	 	
              Consolidated
                Smart Broadband Systems, LLC

              620
                W. 135th Street

              Gardena,
                CA 90248

              Attention:
                Rose B. Sorensen, General Counsel

              Facsimile:
                (310) 715-6371

            	 

    

     

    Any
      party
      may change the above-specified recipient and/or mailing address by notice to
      all
      other parties given in the manner herein prescribed. All notices shall be deemed
      given on the day when actually delivered as provided above (if delivered
      personally, by courier or by telecopy) or on the day shown on the return receipt
      (if delivered by mail or overnight courier).

     

    10.6  Public
      Announcement.
      Except
      as may be required to comply with the requirements of applicable law, no press
      release or similar public announcement or communication will be made or caused
      to be made concerning the execution or performance of this Agreement unless
      specifically approved in advance by Purchaser. The foregoing shall not restrict
      Purchaser’s and Sellers’ communications with shareholders, members, employees,
      suppliers, Subscribers or customers. Notwithstanding anything to the contrary
      in
Section
      5.1
      hereof,
      the parties shall be permitted to disclose such information as is necessary
      to
      perform their obligations as set forth in or contemplated by this
      Agreement.

     

    10.7  Enforcement.
      Each
      Seller acknowledges and agrees that Purchaser would be irreparably damaged
      if
      any of the provisions of this Agreement are not performed in accordance with
      their specific terms and that any breach of this Agreement by either Seller
      could not be adequately compensated in all cases by monetary damages alone.
      Accordingly, in addition to any other right or remedy to which Purchaser may
      be
      entitled, at law or in equity, it shall be entitled to enforce any provision
      of
      this Agreement by a decree of specific performance and to temporary, preliminary
      and permanent injunctive relief to prevent breaches or threatened breaches
      of
      any of the provisions of this Agreement, without posting any bond or other
      undertaking.

     

    10.8  Governing
      Law.
      The
      legality, validity, enforceability and interpretation of this Agreement shall
      be
      governed by the internal laws of the State of California, without giving effect
      to the principles of conflict of laws.

     

    10.9  Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties hereto
      and the successors or assigns of the parties hereto.

     

    10.10  Titles
      and Headings; Construction.
      The
      titles and headings to sections herein are inserted for the convenience of
      reference only and are not intended to be a part of or to affect the meaning
      or
      interpretation of this Agreement. This Agreement shall be construed without
      regard to any presumption or other rule requiring construction hereof against
      the party causing this Agreement to be drafted.

     

    10.11  Severability.
      If any
      provision of this Agreement is held invalid, unenforceable or void by a court
      of
      competent jurisdiction, the remaining provisions shall nonetheless be
      enforceable according to their terms. In such case, the parties agree to use
      their best efforts to achieve the purpose of the invalid provision. Further,
      if
      any provision is held to be overbroad as written, such provision shall be deemed
      amended to narrow its application to the extent necessary to make the provision
      enforceable according to applicable law and shall be enforced as
      amended.

     

    
      
        
        

      

      
        -45-

        
          

        

      

      
        
        

      

    

     

    10.12  No
      Third Party Benefit.
      Nothing
      in this Agreement or the agreements referred to herein, expressed or implied,
      other than indemnification rights under Article
      9
      hereof,
      shall confer on any Person other than the parties hereto or thereto, or their
      respective permitted successors or assigns, any rights remedies, obligations
      or
      liabilities under or by reason of this Agreement, the agreements referred to
      herein, or the transactions contemplated herein or therein.

     

    10.13  Arbitration.
      Any
      action to enforce or interpret this Agreement or to resolve disputes between
      the
      parties shall be settled by arbitration in accordance with the Commercial
      Arbitration Rules of the American Arbitration Association except to the extent
      otherwise expressly provided for herein (the “Arbitration”). The parties agree
      that the Arbitration shall be before a retired Superior Court or Appellate
      Court
      Judge in the State of California, or a California licensed attorney, with at
      least 15 years of relevant commercial business legal experience, and shall
      take
      place in Los Angeles County, California, unless the parties mutually agree
      otherwise. Any party may commence the Arbitration by sending a written demand
      for Arbitration to the other party setting forth the nature of the matter to
      be
      resolved by Arbitration. Within fifteen (15) days of the demand for Arbitration,
      an arbitrator shall be chosen by mutual agreement of the parties to the
      Arbitration. If the parties cannot agree on an arbitrator within such fifteen
      (15) day period, then each party will choose an arbitrator, and those
      arbitrators will have fifteen (15) days to choose a third arbitrator who shall
      individually preside over the Arbitration. The parties shall share equally
      all
      initial costs of Arbitration; provided, however, that the prevailing party
      shall
      be entitled to reimbursement of reasonable attorneys’ fees, costs and expenses
      incurred in connection with the Arbitration. All decisions of the arbitrator
      shall be final, binding and conclusive on all parties. Judgment may be entered
      upon any such decision in accordance with applicable law in any court having
      jurisdiction. 

     

    10.14  Time
      of Essence. With
      regard to all dates and time periods set forth or referred to in this Agreement,
      time is of the essence.

     

    10.15  Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      deemed an original and shall be enforceable against the parties actually
      executing such counterparts, and all of which together shall constitute one
      instrument.

     

    (signature
      page follows)

     

    
      
        
        

      

      
        -46-

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, each of the parties has caused this Agreement to be executed,
      in the manner appropriate for each, as of the date first above
      written.

     

     

    
      	 	CONSOLIDATED SMART BROADBAND SYSTEMS,
              LLC
	 	 
	 	By: __________________________
	 	Glenn S. Corey, Chief Financial
              Officer
	 	 
	 	 
	 	MULTIBAND CORPORATION
	 	 
	 	By: __________________________ 
	 	James Mandel, Chief Executive
              Officer
	 	 
	 	 
	 	RAINBOW SATELLITE GROUP, LLC
	 	 
	 	By: _________________________
	 	 
	 	Name:
              _______________________  
	 	 
	 	Title: ________________________
	 	 

    

     

    
      
        
        

      

      
        -47-

        
          

        

      

      
        
        

      

    

    

      Schedule
        1.1(b)

      Assets

    

    All
      equipment related to the provision of services with respect to each of the
      ROE
      Agreements listed in Schedule
      3.8(a),
      such as
      all customer premise equipment, all components typically found in an L-Band,
      master antenna television, MFH1 and satellite master antenna television
      distribution system, including, without limitation, the following: "500"
      distribution cabling, couplers and fittings, RG 59, RG 11 and RG 6 home run
      and
      home wiring, couplers, splitters and fittings, C-BAND satellite receivers and
      mounting hardware, signal distribution amplifiers lock boxes and home run wiring
      terminus components, including signal taps, splitters and traps, in-residence
      junction boxes and wall plates and all other electronic and passive devices
      used
      to distribute broadband communications signals with respect to each ROE Property
      covered by this Agreement.THIS
      NOTE AND THE SECURITIES ISSUABLE UPON THE CONVERSION HEREOF HAVE NOT BEEN
      REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD,
      OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
      REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF
      COUNSEL SATISFACTORY TO BORROWER THAT SUCH REGISTRATION IS NOT
      REQUIRED.

    

    AMENDED
      AND RESTATED

    SUBORDINATED
      PROMISSORY NOTE

    

    
      	
              $1,500,000.00

            	
              June
                9, 2006

            

    

    

    FOR
      VALUE
      RECEIVED, the undersigned, RONCO CORPORATION, a Delaware corporation, and any
      successor corporation under the Loan Agreement (as hereinafter defined)
      (“Borrower”), promises to pay to the order of SANDERS MORRIS HARRIS INC., a
      Texas corporation, at its office at 600 Travis Street, Suite 3100, Houston,
      Harris County, Texas 77002, or at such other place as the holder of this Note
      (“Lender”) may from time to time designate in writing, the sum of One Million
      Five Hundred Thousand Dollars ($1,500,000.00), or
      such
      lesser amount as shall equal the outstanding principal amount hereof,
with
      interest on the unpaid principal balance from the date of disbursement by Lender
      until paid at the rates set forth below.

    

    Interest
      accruing on this Note will be calculated on the basis of the actual number
      of
      days elapsed for any whole or partial month in which interest is being
      calculated and on the basis of a 360-day year. 

    

    This
      Note
      is one of a duly authorized issue of Notes of Borrower (which term includes
      any
      successor corporation under the Loan Agreement hereinafter referred to) in
      the
      aggregate principal amount of up to $6,000,000.00, issued pursuant to a Letter
      Loan Agreement dated as of June 9, 2006 (the “Loan Agree-ment”), among the
      undersigned and the Lenders identified on Schedule 1 thereto. The terms of
      this
      Note include those stated in the Loan Agreement. Reference is hereby made to
      the
      Loan Agreement and all supple-ments thereto for a statement of the respective
      rights, limitations of rights, duties and immunities thereunder of Borrower
      and
      Lender and of the terms upon which the Notes are, and are to be,
      delivered.

    

    1. 
Interest
      Rate.

     

    The
      per
      annum interest rate hereunder (the “Note Rate”) shall be 4.77%, being the
      short-term “applicable federal rate” for May 2006. Unpaid interest shall be
      compounded annually. Interest shall be payable on the first and second
      anniversary of this Note and at maturity. 

    

    2. 
Maturity.

     

    Any
      and
      all remaining unpaid principal of and interest on this Note shall be due and
      payable in full on June 9, 2009 (the “Maturity Date”); provided, however that
      the principal amount of this Note and all accrued and unpaid interest thereon
      shall be due and payable contemporaneous with the closing of any refinancing
      of
      the Credit Agreement (as hereinafter defined).

    

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    3. 
Application
      of Payments.

     

    So
      long
      as no Event of Default (as used in this Note, the term “Event of Default” have
      the meanings given to those terms in the Loan Agreement) exists, payments under
      this Note and the Security Documents (as defined below) shall be applied:
      (a) first, to the payment of accrued interest; (b) second, at the option of
      Lender, to the payment of any expenses owing under this Note; and (c) third,
      to
      the reduction of the principal amount of this Note. After the occurrence and
      during the continuance of an Event of Default, Lender may apply such payments
      to
      the obligations secured by the Security Instrument in such manner as it may
      elect in its sole discretion.

    

    4. 
Prepayment.

    

    Borrower
      may prepay, without premium or penalty, its obligation under this Note in whole
      or in part from time to time upon giving Lender at least ten days prior written
      notice of its intention to prepay the Note specifying the amount of such
      prepayment; provided however that prepayment may not occur (i) prior to the
      date
      that is 30 days after the end of the Pricing Period and Borrower has given
      proper written notice of the Current Market Price as
      required herein,
      and (ii)
      unless there is a currently effective registration statement covering the shares
      of Common Stock to be issued to holders of Notes upon conversion.

    

    5. 
Subordination.
      No
      payment (whether principal, interest, or other) on account of this Note shall
      be
      made if prior to the time of such payment Lender has received written notice
      from Wells Fargo, National Association
      or
      Laurus Master Fund, Ltd., as the case may be, (each, the “Senior Lender”) that a
      default has occurred under the credit agreement (the “Credit Agreement”) between
      Borrower and such Senior Lender and such event of default shall not have been
      cured or waived or shall not have ceased to exist. The foregoing provision
      is
      not intended to and shall not impair as between the Borrower, its creditors
      other than the Senior Lender, and the holder of this Note, the obligation of
      Borrower, which shall be absolute and unconditional, to pay to the holder of
      this Note the principal of and interest on this Note, as and when the same
      shall
      become due and payable in accordance with the terms hereof, or to affect the
      relative rights of the holder of this Note and creditors of Borrower other
      than
      the Senior Lender, nor shall anything herein prevent the holder of this Note
      from exercising all remedies otherwise permitted by applicable law upon default,
      subject to the rights, under this Section 5, of the Senior Lender in respect
      of
      any required notice of the exercise of any such remedy or cash, property, or
      securities of Borrower received upon exercise of such remedy. The holder of
      this
      Note by acceptance hereof shall be deemed to acknowledge and agree that the
      subordination provisions of this Section 5 are, and are intended to be, an
      inducement and a consideration to the Senior Lender to enter into the Credit
      Agreement with Borrower. Notwithstanding the foregoing, in the event Lender
      shall receive payments in contravention of the terms and conditions of this
      Note
      then (a) all amounts so received shall be deemed to be held in trust for the
      benefit of the Senior Lender; and (b) all such amounts shall be, at the written
      request of Senior Lender, either paid directly to Senior Lender or to
      Borrower.

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    6. 
Security.

     

    This
      Note
      is secured by a security agreement dated June 9, 2006, as amended (the “Security
      Instruments”), executed by Borrower, encumbering the property described in the
      Security Instruments. The Security Instruments and any and all other documents
      securing this Note are collectively referred to as the “Security
      Documents.”

    

    7. 
Conversion.

    

    (a) After
      the
      end of the Pricing Period (as defined below), Lender is entitled, at Lender’s
      option, at any time and from time to time (i) prior to the Maturity Date (except
      that, in the case Borrower defaults on the payment of this Note on the Maturity
      Date, such right to convert shall terminate at the close of business on the
      date
      the Note is paid in full) and (ii) prior to prepayment of this Note pursuant
      to
      Section 4 hereof, to convert all or a portion of the outstanding principal
      amount of and all accrued and unpaid interest under this Note into that number
      of shares of the Borrower’s common stock, $0.00001 par value (the “Common
      Stock”) as is determined by dividing such principal amount and accrued and
      unpaid interest by the Conversion Price, determined as hereinafter provided,
      in
      effect at the time of conversion. The price at which shares of Common Stock
      shall be delivered upon conversion of this Note (the “Conversion Price”) shall
      be the Current Market Price (as hereinafter defined), subject to adjustment,
      as
      hereinafter provided, for a
      stock
      split, stock dividend or other similar event and for merger, consolidation,
      exchange of shares, recapitalization, reorganization or other similar
      event.

    

    (b) In
      order
      to exercise the conversion privilege, the holder of this Note shall surrender
      the Note, duly endorsed or assigned to Borrower or in blank, at the principal
      executive office of Borrower, accompanied by written notice to Borrower at
      such
      office that the holder elects to convert this Note or, if less than the entire
      principal amount hereof is to be converted, the portion thereof to be converted.
      

    

    (c) This
      Note
      shall be deemed to have been converted immediately prior to the close of
      business on the day of surrender of this Note, duly endorsed or assigned to
      Borrower or in blank, for conversion in accordance with the foregoing
      provisions, and at such time the rights of the holder of this Note as a holder
      shall cease, and the person or persons entitled to receive the shares of Common
      Stock issuable upon conversion shall be treated for all purposes as the record
      holder or holders of such shares of Common Stock at such time. As promptly
      as
      practicable on or after the conversion date, Borrower shall issue and shall
      deliver to the holder of this Note, or its designated assigns, a certificate
      or
      certificates for the number of full shares of Common Stock issuable upon
      conversion (bearing such legends as are required by the Loan Agreement and
      applicable state and federal securities laws in the opinion of counsel to the
      Borrower). No payment or adjustment is to be made on conversion for interest
      accrued hereon after the date of conversion or for dividends on the Common
      Stock
      issued on conversion. In the case of this Note that is converted in part only,
      promptly following such conversion Borrower shall execute and Borrower shall
      deliver to the holder hereof, at the expense of Borrower, a new Note or Notes
      of
      authorized denominations in aggregate principal amount equal to the unconverted
      portion of the principal amount of this Note. 

    

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    (d) If,
      prior
      to the conversion of this Note, (i) the number of outstanding shares of Common
      Stock is increased by a stock split, stock dividend, or other similar event,
      the
      Conversion Price shall be proportionately reduced, (ii) the number of
      outstanding shares of Common Stock is decreased by a combination or
      reclassification of shares, or other similar event, the Conversion Price shall
      be proportionately increased, (iii) (A) there shall be any merger,
      consolidation, exchange of shares, recapitalization, reorganization, or other
      similar event, as a result of which shares of Common Stock shall be changed
      into
      the same or a different number of shares of the same or another class or classes
      of stock or securities of the Borrower or another entity or (B) there occurs
      a
      sale of all or substantially all of the Borrower’s assets that is not deemed to
      be a liquidation, dissolution or winding up of the Borrower, then the holder
      of
      this Note shall have the right to receive upon conversion of this Note, upon
      the
      basis and upon the terms and conditions specified herein and in lieu of the
      shares of Common Stock immediately theretofore issuable upon conversion, such
      stock, securities, and/or other assets which the holder of this Note would
      have
      been entitled to receive in such transaction had this Note, together with all
      unpaid and accrued interest thereon, been converted immediately prior to such
      transaction, and in any such case appropriate provisions shall be made with
      respect to the rights and interests of the holder of this Note to the end that
      the provisions hereof (including, without limitation, provisions for the
      adjustment of the Conversion Price) shall thereafter be applicable, as nearly
      as
      may be practicable in relation to any securities thereafter deliverable upon
      the
      exercise hereof.

    

    (e) No
      fractional shares shall be issued upon conversion of this Note. In lieu of
      the
      Borrower issuing any fractional shares to Lender upon the conversion of this
      Note, the Borrower shall pay to Lender an amount equal to the product obtained
      by multiplying the Conversion Price by the fraction of a share not issued
      pursuant to the previous sentence. Upon conversion of this Note in full and
      the
      payment of any amounts specified in this Section 7(e),
      the
      Borrower shall be forever released from all its obligations and liabilities
      under this Note.

    

    (f) “Current
      Market Price” means at any date the average of the closing price of the Common
      Stock on all securities exchanges (including the Nasdaq Stock Market) on which
      it may at the time be listed, or, if there have been no sales on any such
      exchange on any day, or, if on any day such security is not so listed, the
      average of the representative bid and asked prices quoted on the Nasdaq Stock
      Market as of 4:00 p.m., New York time, or if on any day such security is not
      quoted in the Nasdaq Stock Market, the average of the highest bid and lowest
      ask
      prices on such day in the domestic over-the-counter market as reported by the
      OTC Bulletin Board, Pink Sheets LLC, or any similar successor organization,
      in
      each case for the twenty (20) consecutive trading days (the “Pricing Period”)
      commencing on the earlier of the first trading day immediately following the
      effective date of (i) Borrower’s Registration Statement on Form S-1 (File No.
      333-127056) originally filed with the Securities and Exchange Commission (the
      “SEC”) on Form SB-2 on July 29, 2005 (the “Original Registration Statement”),
      (ii) such other registration statement as may be filed by the Borrower with
      the
      SEC covering shares of Common Stock issuable upon conversion of the Borrower’s
      Series A Convertible Preferred Stock (the “Contingent Registration Statement”
and together with the Original Registration Statement, the “Current Registration
      Statement”) or (iii) the Additional Registration Statement (as defined below).
      Notwithstanding the foregoing, in the event that the Pricing Period has not
      ended by December 31, 2006, “Current Market Price” shall mean $0.17, and the
      Pricing Period shall be deemed to have ended on December 31, 2006. Lender agrees
      that it will not, without the prior written consent of Borrower, sell, offer,
      contract or grant any option to sell (including without limitation any short
      sale), transfer, or otherwise dispose of any shares of Common Stock of Borrower,
      options, or warrants to acquire shares of Common Stock, or securities
      exchangeable or exercisable for or convertible into shares of Common Stock
      owned
      by Lender during the Pricing Period. Borrower shall provide written notice
      of
      the Current Market Price promptly following the end of the Pricing Period to
      the
      holder of this Note. 

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (g) Borrower
      shall pay all documentary, stamp, transfer or other transactional taxes
      attributable to the issuance or delivery of shares of Common Stock of Borrower
      or other securities or property upon conversion of any Notes: provided, however,
      that Borrower shall not be required to pay any taxes which may be payable in
      respect of any transfer involved in the issuance or delivery of any certificate
      for such shares or securities in the name other than that of the holder of
      this
      Note in respect of which such shares are being issued.

    

    (h) Borrower
      shall reserve at all times so long as this Note remains outstanding, free from
      preemptive rights, out of its treasury stock or its authorized but unissued
      shares of Common Stock, or both, solely for the purpose of effecting the
      conversion of this Note, sufficient shares of Common Stock to provide for the
      conversion of this Note.

    

    (i) If
      any
      shares of Common Stock or other securities to be reserved for the purpose of
      conversion of this Note require registration with or approval of any
      governmental authority under any Federal or state law before such shares or
      other securities may be validly issued or delivered upon conversion, then
      Borrower and the holders of this Note will in good faith and as expeditiously
      as
      possible endeavor to secure such registration or approval, as the case may
      be.

    

    (j) All
      shares of Common Stock or other securities which may be issued upon conversion
      of this Note will upon issuance by Borrower be duly and validly issued, fully
      paid and nonassessable and free from all taxes, liens and charges with respect
      to the issuance thereof and Borrower shall take no action which will cause
      a
      contrary result.

    

    (k)
      Borrower shall use its commercially reasonable efforts to register the shares
      issuable upon conversion of this Note on the Current Registration Statement;
      provided, however, that if the Borrower’s counsel determines in good faith that
      the shares issuable upon conversion of this Note cannot be registered on such
      Current Registration Statement then the
      Borrower agrees to use its commercially reasonable efforts to file an additional
      Registration Statement on Form S-1 (the “Additional Registration Statement”) or
      such other appropriate form for the general registration of the resale of the
      shares issuable upon conversion of this Note within 60 days following the
      effective date of the Current Registration Statement. The Borrower agrees to
      use
      commercially reasonable efforts to cause the Additional Registration Statement
      to be declared effective within 90 days of the date of filing of such Additional
      Registration Statement. Sections 4, 5, 6, 8, 9, 10, 11 and 12(a), 12(b), 12(e),
      12(g) (the “Incorporated Sections”) of that certain Registration Rights
      Agreement dated as of June 30, 2005 between the Borrower and the parties set
      forth on the signature page and Exhibit A to such agreement (the “Existing
      Registration Rights Agreement”) are incorporated herein by reference and made a
      part of this Note. Terms used in the Incorporated Sections not otherwise defined
      in this Note shall have the meaning assigned to them under Section 1 of the
      Existing Registration Rights Agreement. The term Registrable Securities in
      the
      Incorporated Sections shall be deemed to include the shares issuable upon
      conversion of this Note. Nothing contained herein shall be construed to
      incorporate by reference any other section of the Existing Registration Rights
      Agreement except those specifically set forth herein.

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    8. 
Default;
      Remedies.

     

    Upon
      the
      occurrence of an Event of Default, and without notice or demand, all amounts
      owed under this Note, including all accrued but unpaid interest, shall
      thereafter bear interest at the rate of 5% per annum above the Note Rate (the
      “Default Rate”) until all Events of Default are cured. Failure to exercise any
      option granted to Lender hereunder shall not waive the right to exercise the
      same in the event of any subsequent Event of Default. Interest at the Default
      Rate shall commence to accrue upon the occurrence of any Event of Default,
      including the failure to pay this Note at maturity.

    

    9. 
Attorneys’
      Fees.

     

    The
      Borrower agrees to pay all costs of collection incurred in enforcing this Note,
      including attorneys' fees and costs at both trial and appellate levels and
      in
      any bankruptcy action. In the event any legal proceedings are instituted in
      connection with, or for the enforcement of this Note, the Lender shall be
      entitled to recover its costs of suit, including attorneys' fees and costs,
      at
      both trial and appellate levels and in any bankruptcy action.
      

    

    10. 
Miscellaneous

    

    Every
      person or entity at any time liable for the payment of the indebtedness
      evidenced hereby waives presentment for payment, demand, and notice of
      nonpayment of this Note. Every such person or entity further hereby consents
      to
      any extension of the time of payment hereof, the release of all or any part
      of
      the security herefor or the release of any party liable for the payment of
      the
      indebtedness evidenced hereby at any time and from time to time at the request
      of anyone now or hereafter liable therefor. Any such extension or release may
      be
      made without notice to any of such persons or entities and without discharging
      their liability.

    

    The
      entity that signs this Note is liable for the full repayment of the entire
      indebtedness evidenced hereby and the full performance of each and every
      obligation contained in the Security Documents.

    

    The
      headings to the various sections have been inserted for convenience of reference
      only and do not define, limit, modify, or expand the express provisions of
      this
      Note.

    

    Any
      provision of this Note may be amended, waived or modified upon the written
      consent of the Borrower and the Lender.

    

    Time
      is
      of the essence under this Note and in the performance of every term, covenant,
      and obligation contained herein.

    

    This
      Note
      is made with reference to and is to be construed in accordance with the laws
      of
      the state of Texas, without regard to its conflict of law
      principles.

    

    If
      this
      Note or any of the Security Documents are lost, stolen, mutilated or destroyed
      and Lender delivers to Borrower an indemnification agreement in a form
      reasonably satisfactory to Borrower reasonably indemnifying Borrower against
      any
      loss or liability resulting therefrom, Borrower will execute and deliver to
      Lender a replacement thereof in form and content identical to the original
      document which will have the effect of the original for all
      purposes.

    

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    11. 
Transfer
      of this Note or Securities Issuable on Conversion
      Hereof. 

    

    With
      respect to any offer, sale or other disposition of this Note or securities
      into
      which such Note may be converted, Lender will give written notice to the
      Borrower prior thereto, describing briefly the manner thereof, together with
      a
      written opinion of Lender’s counsel, or other evidence reasonably satisfactory
      to the Borrower, to the effect that such offer, sale, or other distribution
      may
      be effected without registration or qualification under any applicable federal
      or state law then in effect. Upon receiving such written notice and reasonably
      satisfactory opinion or other evidence, the Borrower, as promptly as
      practicable, shall notify Lender that Lender may sell or otherwise dispose
      of
      this Note or such securities, all in accordance with the terms of the notice
      delivered to the Borrower. If a determination has been made pursuant to this
      Section 11 that the opinion of counsel for Lender, or other evidence, is
      not reasonably satisfactory to the Borrower, the Borrower shall so notify Lender
      promptly after such determination has been made. Each Note thus transferred
      and
      each certificate representing the securities thus transferred shall bear a
      legend as to the applicable restrictions on transferability in order to ensure
      compliance with the Securities Act of 1933, as amended (the “Act”), unless in
      the opinion of counsel for the Borrower such legend is not required in order
      to
      ensure compliance with the Act. The Borrower may issue stop transfer
      instructions to its transfer agent in connection with such restrictions. Subject
      to the foregoing, transfers of this Note shall be registered upon registration
      books maintained for such purpose by or on behalf of the Borrower as provided
      in
      the Loan Agreement. Prior to presentation of this Note for registration of
      transfer, the Borrower shall treat the registered holder hereof as the owner
      and
      holder of this Note for the purpose of receiving all payments of principal
      and
      interest hereon and for all other purposes whatsoever, whether or not this
      Note
      shall be overdue and the Borrower shall not be affected by notice to the
      contrary. Notwithstanding the foregoing, this Section 11 shall not apply to
      securities into which this Note may be converted following the registration
      of
      such securities pursuant to Section 7(k) of this Agreement. Notwithstanding
      the
      foregoing, this Note may not be transferred prior to the completion of the
      Rights Offering (as defined in the Loan Agreement) and the registration rights
      granted pursuant to Section 7(k) of this Note may not be
      transferred.

    

    12. 
Notices. 

    

    All
      notices, requests, demands, consents, instructions, or other communications
      required or permitted hereunder shall in writing and faxed, mailed, or delivered
      to each party at the respective addresses of the parties as set forth in the
      Loan Agreement, or at such other address or facsimile number as the Borrower
      shall have furnished to Lender in writing. All such notices and communications
      will be deemed effectively given the earlier of (a) when received,
      (b) when delivered personally, (c) one business day after being
      delivered by facsimile (with receipt of appropriate confirmation), (d) one
      business day after being deposited with an overnight courier service of
      recognized standing or (e) four days after being deposited in the U.S.
      mail, first class with postage prepaid.

    

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    13. 
Pari
      Passu Notes. 

    

    Lender
      acknowledges and agrees that the payment of all or any portion of the
      outstanding principal amount of this Note and all interest hereon shall be
      pari
      passu in
      right
      of payment and in all other respects to the other Notes issued pursuant to
      the
      Loan Agreement or pursuant to the terms of such Notes. In the event Lender
      receives payments in excess of its pro rata share of the Borrower’s payments to
      the Lenders of all of the Notes, then Lender shall hold in trust all such excess
      payments for the benefit of the holders of the other Notes and shall pay such
      amounts held in trust to such other holders upon demand by such
      holders.

    

    14. 
Consent
      to Jurisdiction.
      

    

    Borrower
      irrevocably submits to the jurisdiction of any state or federal court sitting
      in
      Houston, Texas, over any suit, action, or proceeding arising out of or relating
      to this Note or the loan evidenced hereby. Borrower irrevocably waives, to
      the
      fullest extent permitted by law, any objection that Borrower may now or
      hereafter have to the laying of venue of any such suit, action, or proceeding
      brought in any such court and any claim that any such suit, action, or
      proceeding brought in any such court has been brought in an inconvenient forum.
      Borrower further consents and agrees to service of any summons, complaint or
      other legal process in any such suit, action or proceeding by registered or
      certified U.S. mail, postage prepaid, to Borrower at the address for notices
      set
      forth following its signature, and consents and agrees that such service shall
      constitute in every respect valid and effective service (but nothing herein
      shall affect the validity or effectiveness of process served in any other manner
      permitted by law).

    

    15. 
WAIVER
      OF JURY TRIAL.
      

    

    LENDER
      AND BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS
      THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON,
      OR
      ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THE LOAN, THIS NOTE OR ANY OTHER
      LOAN DOCUMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
      ORAL OR WRITTEN), OR ACTIONS OF LENDER OR BORROWER. THIS PROVISION IS A MATERIAL
      INDUCEMENT FOR LENDER TO MAKE THE LOAN TO BORROWER.

    

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    
 

    DATED
      as
      of the day and year first above written.

    

    
      	 	
              RONCO
                CORPORATION, a Delaware corporation

            
	 	 
	 	 
	 	
              By:
                /s/
                Paul
                Kabashima                                                  
                

            
	 	
              Name:
                Paul Kabashima

            
	 	
              Title:
                Interim President and Chief Executive
                Officer

            

    

    

    Address:

    

    61
      Moreland Road

    Simi
      Valley, CA 93065

    

    ACKNOWLEDGED
      AND AGREED TO:

    

    SANDERS
      MORRIS HARRIS INC., a Texas corporation

    

    

    By:
      /s/Ben
      T.
      Morris                                                     
    

    

    Name:__________________________________      

    

    Title:___________________________________ 

     

     

     

     

    
      
         

      

      
        9

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