Document:

EXHIBIT
4.1                      

    

    THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAWS.  THEY MAY NOT BE SOLD OR OFFERED FOR SALE IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR EXEMPTION THERE
FROM.

    

    
      	
              No.  EW-00

            	
              DATE:________________

            

    

    

    ZERCO
SYSTEMS INTERNATIONAL, INC.

    WARRANT
TO PURCHASE COMMON STOCK

    

    This certifies that ______________________________________
the holder of this Warrant (the “Warrantholder”), is entitled to purchase
from Zerco Systems International, Inc., a Delaware corporation (the “Company”),
at any time on or before 5:00 p.m., Eastern Standard Time, on the two-year
anniversary of the date hereof (or, if such day is not a Business Day, as
defined herein, at or before 5:00 p.m., Eastern Standard Time on the next
following Business Day), up to ______________ fully
paid and nonassessable shares of Common Stock of the Company at the Exercise
price (as defined below).  The Exercise Price and the number of shares
purchasable hereunder are subject to adjustment under certain conditions as
provided in Article III hereof.

    

    ARTICLE
I

    

    Section 1.01:  Definition
of Terms:  As used in this Warrant, the following capitalized
terms shall have the following respective meanings:

    

    
      	
               
      

            	
              (a)

            	
              Business
      Day:  A day other than a Saturday, Sunday or other day on
      which banks in the State of Ohio are authorized by law to remain
      closed.

            

    

    

    
      	
               
      

            	
              (b)

            	
              Common
      Stock:  Common Shares, no par value, of the
      Company.

            

    

    

    
      	
               
      

            	
              (c)

            	
              Common Stock
      Equivalents:  Securities that are convertible into or
      exchangeable or exercisable for shares of Common
  Stock.

            

    

    

    
      	
               
      

            	
              (d)

            	
              Exercise Price:
      The per share price for which the Warrantholder may purchase Warrant
      Shares pursuant to this Warrant.  The initial Exercise price is
      $0.01.  The Exercise Price may be adjusted from time to time
      pursuant to Article III hereof.

            

    

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              (e)

            	
              Expiration
      Date:  5:00 p.m., Eastern Standard Time, on the two-year
      anniversary of the date hereof, or, if such day is not a Business Day, on
      the next following Business Day.

            

    

    

    
      	
            	
              (f) 

            	
              Holder:  A
      holder of Warrant Shares.

            

    

    

    
      	
               
      

            	
              (g)

            	
              Person:  An
      individual, partnership, joint venture, corporation, trust, unincorporated
      organization or government or any department or agency
      thereof.

            

    

    

    
      	
               
      

            	
              (h)

            	
              SEC:  The
      Securities and Exchange Commission or any other federal agency at the time
      administering the Securities Act.

            

    

    

    
      	
               
      

            	
              (i)

            	
              Securities
      Act:  The Securities Act of 1933, as
    amended.

            

    

    

    
      	
               
      

            	
              (j)

            	
              Warrants:  This
      Warrant and all other warrants that may be issued in replacement of this
      Warrant.

            

    

    

    
      	
               
      

            	
              (k)

            	
              Warrantholder:  The
      Person to whom this Warrant is originally issued, any successor in
      interest thereto, or any assignee or transferee thereof in whose name this
      Warrant is registered upon the books maintained by the Company for that
      purpose.

            

    

    

    
      	
               
      

            	
              (l)

            	
              Warrant
      Shares:  Shares of Common Stock purchasable upon exercise
      of the Warrants.

            

    

    

    ARTICLE
II

    

    Duration
and Exercise of Warrant

    

    Section 2:01:  Duration of
Warrant.  Subject to the terms contained herein, this Warrant
may be exercised at any time on or before 5:00 p.m., Eastern Standard Time, on
the Expiration Date.  If this Warrant is not exercised at or before
5:00 p.m., Eastern Standard Time, on the Expiration Date, It shall become void
and all rights hereunder shall thereupon cease.

    

    Section
2.02:  Exercise of Warrant.

    

    (a)           Subject
to the terms and conditions set forth herein, the Warrantholder may exercise
this Warrant, in whole or in part, upon surrender of this Warrant with the
Subscription Form attached hereto duly executed, to the Company at its corporate
office at 7140 Brookwood Drive, Brookfield, Ohio 44403, together with payment in
full of the Exercise Price for each Warrant Share to be purchased in lawful
money of the United States, by certified check or bank draft payable to the
order of the Company in currency of the United States.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    (b)           Upon
receipt of this Warrant with the Subscription Form duly executed and accompanied
by payment of the aggregate Exercise Price for the Warrant Shares for which this
Warrant is then being exercised, the Company will issue certificates to the
Warrantholder for the total number of Warrant Shares for which this Warrant is
being exercised in such denominations as are requested by the
Warrantholder.

    

    (c)           If
the Warrantholder shall exercise this Warrant with respect to less than all of
the Warrant Shares that may then be purchased under this Warrant, the Company
will execute a new warrant in the form of this Warrant for the balance of such
Warrant Shares and deliver such new warrant to the Warrantholder.

    

    (d)           The
Company covenants and agrees that it will pay, when due and payable, any and all
stock transfer and similar taxes that may be payable in respect of the issuance
of this Warrant or of any Warrant Shares; and (ii) the Warrant Shares shall be
deemed to be issued to the Warrantholder as the record owner of such Warrant
Shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment has b3een tendered for the purchase of such Warrant
Shares.

    

    ARTICLE
III

    

    Adjustment
of Number of Warrant Shares

    Purchasable
and of Exercise Price

    

    The
Exercise Price and the number and type of Warrant Shares shall be subject to
adjustment from time to time upon the happening of certain events described in
this Article III.

    

    Section 3:01:  Mechanical
Adjustments.

    

    (a)           If
at any time prior to the full exercise of this Warrant, the Company
shall:  (i) pay a dividend or make a distribution on its shares of
Common Stock in shares of Common Stock; (ii) subdivide, reclassify or
recapitalize its outstanding shares of Common Stock into a greater number of
shares; or (iii) combine, reclassify or recapitalize its outstanding shares of
Common Stock into a smaller number of shares, the Exercise Price in effect at
the time of the record date of such dividend, subdivision, combination,
reclassification or recapitalization shall be proportionately adjusted so that
the Warrantholder shall be entitled to receive the aggregate number and type of
shares that, if this Warrant had been exercised in full immediately prior to
such time and the Warrant Shares had been converted in full, it would have been
owned upon such exercise and been entitled to receive upon such dividend,
subdivision, combination, reclassification or recapitalization.  Such
adjustment shall be made successively whenever any event listed in this
paragraph 3:01(a) shall occur.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    (b)           If
the Company shall sell or issue Common Stock (other than pursuant to a
transaction described in paragraph (a) above) or rights, options, warrants or
convertible or exchangeable securities, or options to purchase convertible or
exchangeable securities, entitling the holder of such instrument to subscribe
for or purchase shares of Common Stock (or Common Stock Equivalents), without
consideration or for a “consideration per share” (determined in the manner
described below) less than the then current Exercise Price of this Warrant, the
Exercise price shall be adjusted so that it shall equal the price determined by
multiplying the Exercise Price in effect immediately prior to the date of such
sale or issuance (which date, in the event of a distribution to shareholders,
shall be deemed to be the record date set by the Company to determine
shareholders entitled to participate in such distribution) by a fraction, the
numerator of which shall be (i) the number of shares of Common Stock outstanding
on the date of such sale or issuance, plus (ii) the number of additional shares
of Common Stock which the aggregate consideration received by the Company upon
such issuance or sale (plus the aggregate of any additional amount to be
received by the Company upon the exercise of such rights or warrants) would
purchase at the then current Exercise price, and the denominator of which shall
be (i) the number of shares of Common Stock outstanding on the date of such
issuance or sale, plus (ii) the number of additional shares of Common Stock
offered for subscription or purchase (or into which the Common Stock Equivalents
so offered are convertible.)  Such adjustments shall be made
successively whenever such warrants or rights are issued.  To the
extent that shares of Common Stock are not delivered (or Common Stock
Equivalents are not delivered) after the expiration of such rights or warrants,
the Exercise Price shall be readjusted to the Exercise Price that would then be
in effect had the adjustments made upon he issuance of such rights or warrants
been made upon the basis of delivery of only the number of shares of Common
Stock (or Common Stock Equivalents) actually delivered.  For purposes
of this Section 3.01(b), the “consideration per share” of securities issued by
the Company shall be determined, in the case of rights, options, warrants and
convertible or exchangeable securities, or options to purchase convertible or
exchangeable securities, by dividing (x) the total amount received or receivable
by the Company in consideration of the sale or issuance of the rights, options,
warrants or convertible or exchangeable securities, or options to purchase
convertible or exchangeable securities, plus the total consideration payable to
the Company upon conversion, exchange or exercise thereof, by (y) the total
number of shares of Common Stock covered by such rights, options, warrants and
convertible or exchangeable securities.

    

    (c)           Whenever
the Exercise Price payable upon exercise of this Warrant is adjusted pursuant to
paragraph (a) or (b) of this Section 3.01, the Warrant Shares shall
simultaneously be adjusted by multiplying the number of Warrant Shares initially
issuable upon exercise of each Warrant by the Exercise Price in effect on the
date thereof and dividing the product so obtained by the Exercise Price, as
adjusted.

    

    (d)           No
adjustment in the Exercise Price shall be required unless such adjustment would
require an increase or decrease of at least one cent ($.01) in the Exercise
Price; provided, however, that any adjustments which by reason of this paragraph
(d) are not required to be made shall be carried forward and taken into account
in any subsequent adjustment.  All calculations under this Section
3.01 shall be made to the nearest cent or to the nearest one-hundredth of a
share, as the case may be.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    (e)           In
the event that at any time, as a result of any adjustment made pursuant to
paragraph (a) of this Section 3.01, the Warrantholder thereafter shall become
entitled to receive any securities of the Company other than shares of Common
Stock, thereafter the number of such other securities so receivable upon
exercise of any warrant shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Common Stock contained in paragraphs (a) to (d), inclusive, of
this Section 3.01.

    

    Section 3.02:  Notice of
Adjustment.  Whenever the number of Warrant Shares or the
Exercise Price is adjusted as herein provided, the Company shall prepare and
deliver to the Warrantholder a certificate signed by its President, or any Vice
President, Treasurer or Secretary, setting forth the adjusted number of shares
purchasable upon the exercise of this Warrant and the Exercise Price of such
shares after such adjustment, setting forth a brief statement of the facts
requiring such adjustment and setting forth the computation by which such
adjustment was made.

    

    Section 3.03:  Preservation
of Purchase Rights Upon Merger, Consolidation, etc.  As a
condition to any consolidation of the Company with or merger of the Company into
another corporation or any sale, lease or other transfer or conveyance to
another corporation of all or substantially all the property or assets of the
Company, the Company or such successor or purchasing corporation, as the case
may be, shall execute the Warrantholders an agreement granting the
Warrantholders the continuing right, upon payment of the Exercise Price in
effect immediately prior to such action, to purchase upon exercise of this
Warrant the kind and amount of shares and other securities and property which
such holder would have owned or have been entitled to receive after the
consummation of such consolidation, merger, sale, lease, transfer or conveyance
had this Warrant been exercised immediately prior to such
action.  Such agreement shall provide for adjustments, which shall be
as nearly equivalent as may be practicable to the adjustment provided for in
this Article III.  The provisions of this Section 3.03 shall similarly
apply to successive consolidations, mergers, sales, leases, transfers or
conveyances.

    

    Section 3.04:  Form of
Warrant After Adjustments.   The form of this Warrant need
not be changed because of any adjustments in the Exercise Price or the number or
kind of the Warrant Shares, and Warrants theretofore or thereafter issued may
continue to express the same price and number and kind of shares as are stated
in this Warrant as initially issued.

    

    ARTICLE
IV

    

    Other
Provisions Relating to Rights of Warrantholder

    

    Section 4.01:  No Rights as
Stockholders; Notice to Warrantholders.  Nothing contained in
this Warrant shall be construed as conferring upon the Warrantholder or its
transferees the right to vote or to receive dividends or to consent or to
receive notice as a shareholder in respect of any meeting of shareholders for
the election of directors of the Company.  If, however, at any time
prior to the expiration or exercise in full of the Warrants, any of the
following events shall occur:

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              (a)

            	
              The
      Company shall offer to the holders of its Common Stock any additional
      shares of Common Stock or Common Stock Equivalents or any right to
      subscribe thereto;

            

    

    

    
      	
               
      

            	
              (b)

            	
              A
      dissolution, liquidation or winding up of the Company shall be proposed;
      or

            

    

    

    
      	
               
      

            	
              (c)

            	
              Any
      consolidation of the Company with or merger of the Company into another
      corporation or the sale, lease or conveyance to another corporation of the
      property of the Company as an entirety or substantially as an entirety
      shall be proposed;

            

    

    

    then in
any one or more of such events, the Company shall give written notice of such
event to the Warrantholder at least 25 days prior to the date fixed as a record
date or the date of closing of the Company’s stock transfer books for the
determination of the shareholders entitled to receive such distribution, or
subscription rights, or for the determination of the shareholders entitled to
vote on such proposed merger, consolidation, sale, lease, conveyance,
dissolution, liquidation or winding up.  Such notice shall specify
such record date or the date of closing of the stock transfer books, as the case
may be.

    

    Section 4.02:  Lost,
Stolen, Mutilated or Destroyed Warrants.  If this Warrant is
lost, stolen, mutilated or destroyed, the Company shall, on such reasonable
terms as to indemnify or otherwise as it may in its discretion impose (which
shall, in the case of a mutilated Warrant, include the surrender thereof), issue
a new Warrant of like denomination and tenor as, and in substitution for, this
Warrant.

    

    Section 4.03:  Reservation of
Shares

    

    (a)           The
Company covenants and agrees that at all times it shall reserve and keep
available for the exercise of this Warrant such number of authorized shares of
Common Stock as are sufficient to permit the exercise in full of this
Warrant.

    

    (b)           The
Company covenants that all shares of Common Stock issued upon exercise of this
Warrant will be validly issued, fully paid, nonassessable and free of preemptive
rights.

    

    ARTICLE
V

    

    Treatment
of Warrantholder

    

    Prior to due presentment for
registration of transfer of this Warrant, the Company may deem and treat the
Warrantholder as the absolute owner of this Warrant (notwithstanding any
notation of ownership or other writing hereon) for the purpose of any exercise
hereof and for all other purposes and the Company shall not be affected by any
notice to the contrary.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    

    ARTICLE
VI

    

    Split-Up,
Combination, Exchange and transfer of Warrants

    

    Section 6:01:  Split-Up,
Combination, Exchange and Transfer of Warrants.  Subject to and
limited by the provisions of Section: 6.02 hereof, this Warrant may be split up,
combined or exchanged for another Warrant or Warrants containing the same terms
and entitling the Warrantholder to purchase a like aggregate number of Warrant
Shares.  If the Warrantholder desires to split up, combine or exchange
this Warrant, it shall make such request in writing delivered to the Company and
shall surrender to the Company this Warrant and any other Warrants to be so
split up, combined or exchanged.  Upon any such surrender for a
split-up, combination or exchange, the Company shall execute and deliver to the
person entitled thereto a Warrant or Warrants, as the case may be, as so
requested.  The Company shall not be required to effect any split-up,
combination or exchange which will result in the issuance of a Warrant entitling
the Warrantholder to purchase upon exercise a fraction of a share of Common
Stock or a fractional Warrant.  The Warrantholder acknowledges that
the transfer of this Warrant to any other Person shall not be effected without
an opinion of counsel in form and substance reasonably satisfactory to Company
to the effect that registration of the same is not required.

    

    Section 6:02:  Purchase for
Investment.  The Warrantholder is purchasing the Warrant for
its own account, for investment purposes and not with a view to, or for resale
in connection with, any distribution or public offering thereof within the
meaning of the Securities Act.

    

    Section 6.03:  Unregistered
Securities; Legend.  The Warrantholder understands that neither
the Warrant nor the Warrant Shares have been registered under the Securities Act
and will be issued in reliance upon an exemption from the registration
requirements thereof.  The Warrantholder acknowledges this Warrant
bears, and that the certificates representing the Warrant Shares shall each bear
such restrictive legends as are required by federal and state securities laws,
including a legend substantially as follows:

    

    “The
securities represented by this certificate have not been registered under the
Securities Act of 1933 or any applicable state securities laws and may not be
offered for sale, sold, transferred or conveyed without registration or, if
required by the Company, an opinion of counsel in form and substance reasonably
satisfactory to the Company to the effect that such registration is not
required.”

    

    Section 6.04:  Status of
Warrantholder:  The Warrantholder is an accredited investor, as
that term is defined in Rule 501 of Regulation D of the Securities
Act.  The Warrantholder will furnish the Company such information as
the Company may reasonably request regarding its status as an accredited
investor.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    

    ARTICLE
VII

    

    Representations
and Warranties of the Company; Other Matters

    

    Section
7.01:  Representations and Warranties.  The Company
represents and warrants to and agrees with the Warrantholder that:

    

    (a)           the
Company has all requisite power and authority, corporate or otherwise, and has
taken all necessary action, to execute, deliver and perform its obligations
under the Warrant.  This Warrant has been duly and validly authorized,
executed and delivered by the Company and constitutes a valid and binding
agreement of the Company enforceable against the Company in accordance with its
terms.  No authorization, approval, consent, order, license,
franchise, certificate or permit of or from any Person or regulatory authority
is required to be obtained by the Company in connection with the execution,
delivery or performance of this Warrant;

    

    (b)           none
of the execution, delivery or performance of the Company’s obligations under
this Warrant will conflict with, or result in a breach of any of the terms of
provisions of, or constitute a default under or violate any term of (i) the
articles of incorporation, as amended, or the code of regulations of the
Company; (ii) any indenture, mortgage, joint venture agreement, lease, sublease,
sales agreement or other agreement or instrument to which the Company is a party
or by which it or any of its properties is bound; or (iii) any law, rule,
regulation, judgment, order or decree of any government, governmental or
regulatory body or court, foreign or domestic, having jurisdiction over the
Company or any of its properties or assets; and

    

    (c)           the
Warrant Shares have been duly reserved for issuance upon exercise of the
Warrants and, when issued upon such exercise in accordance with the terms of
this Warrant, will be duly and validly issued, fully paid and nonassessable, and
the issuance of the Warrant Shares is not subject to any preemptive or similar
rights granted by the Company, and other Person or any statute.

    

    Section 7.02:  Expenses of
Transfer:  The Company will from time to time promptly pay all
taxes and charges that may be imposed with respect to the issuance or delivery
of Warrant Shares upon the exercise of this Warrant by the
Warrantholder.

    

    Section 7.03:  Successors
and Assigns.  All the covenants and provisions of this Warrant
by or for the benefit of the Company shall bind and inure to the benefit of its
successors and assigns hereunder.

    

    Section 7.04:  No
Inconsistent Agreements.  The Company will not on or after the
date of this Warrant enter into any agreement with respect to its securities,
which is inconsistent with the rights granted to the Warrantholder or otherwise
conflicts with the provisions hereof.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    Section 7.05:  Adjustments
Affecting Warrant Shares.  The Company will not take any action
outside the ordinary course of business, or permit any change within its control
to occur outside the ordinary course of business, with respect to this Warrant
or the Warrant shares which is without a bona fide business
purpose.

    

    Section 7.06:  Amendments
and Waivers.  The provisions of this Warrant, including,
without limitation, the provisions of this sentence, may not be amended,
modified or supplemented, and waiver or consents to departures from the
provisions hereof may not be given, unless the Company has obtained the written
consent of beneficial Holders of at least a majority of the outstanding Warrant
Shares.  Holders shall be bound by any consent authorized by this
section whether or not certificates representing such Warrant Shares have been
marked to indicate such consent.

    

    Section
7.07:  Counterparts.  This Warrant may be executed in
any number of separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.

    

    Section 7.08:  Governing
Law.  This Warrant shall be governed by and construed in
accordance with the laws of the State of Delaware.

    

    Section
7.09:  Severability.  in the event that any one or
more of the provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable, the validity, legality
and enforceability of any such provision in every  other respect and
of the remaining provisions contained herein shall not be affected or impaired
thereby.

    

    Section
7.10:  Integration/Entire Agreement.  This Warrant is
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreement and understanding of the
parties hereto with respect to the subject matter contained
herein.  This Warrant supersedes all prior agreements and
understandings between the parties with respect to such subject
matter.

    

    Section 7.11:  Attorney’s
Fees.  In any action or proceeding brought to enforce any
provisions of this Warrant, the successful party shall be entitled to recover
attorneys’ fees and disbursements in addition to its costs and expenses and any
other available remedy.

    

    Section
7.12:  Notices.  Notice or demand pursuant to this
Warrant to be given or made by the Warrantholder to or on the Company shall be
sufficiently given or made if sent by first class mail, postage prepaid,
addressed (until another address is designated in writing by the Company) as
follows:

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    

    Zerco
Systems International, Inc.

    7140
Brookwood Drive

    Brookfield,
OH  44403

    Attention:  John
Soltesz, CEO

    

    Any notice or demand authorized by this
Warrant to be given or made by the Company to or on the Warrantholder or a
Holder of Warrant Shares shall be sufficiently given or made if sent by first
class mail, postage prepaid, to the Warrantholder or the Holder of Warrant
Shares at its last known address as it shall appear on the books of the
Company.

    

    Section
7.13:  Headings.  The Articles headings in this
Warrant are for convenience only and are not part of this Warrant and shall not
affect the interpretation thereof.

    

    IN WITNESS WHEREOF, this Warrant has
been duly executed by the Company as of ________________, 20__.

    

    
      
        
          	 
      	
                  ZERCO
      SYSTEMS INTERNATIONAL, INC.

                
	 
      	 
      
	 
      	
                  By: 

                	 
      
	 
      	 
      	
                    
      John A. Niotti-Soltesz,
C.E.O.

                

        

      

    

    

    
      
        
          
            	 
      	
                    Attest: 

                  	 
      
	 
      	 
      	
                     
      Secretary

                  

          

        

      

    

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    

    SUBSCRIPTION
FORM

    

    (To be
executed upon exercise of Warrant)

    

    Zerco
Systems International, Inc.

    

    The undersigned hereby irrevocably
elects to exercise the right of purchase represented by the within Warrant
Certificate for, and to purchase hereunder, shares of Common Stock, as provided
for therein, and tenders herewith payment of the purchase price
in  full in the form of cash, a certified or official bank check in
the amount of $______.

    

    Please issue a certificate or
certificates for such shares of Common Stock in the name of:

    

    
      
        
          
            
              	 
      	
                      Name: 

                    	 
      
	 
      	 
      	
                      (Please
      Print Name, Address and Social

                    
	 
      	 
      	
                      Security
      Number)

                    
	 
      	 
      	 
      
	 
      	
                      Signature:

                    
	 
      	 
      
	 	 
	 
      	
                      NOTE:     
      The above signature should correspond exactly with the name on the first
      page of this Warrant Certificate or with the name of the assignee
      appearing in the assignment form
below

                    

            

          

        

      

    

    

    And if said number of shares shall not
be all the shares purchasable under the within Warrant Certificate, a new
Warrant Certificate is to be issued in the name of said undersigned for the
balance remaining of the shares purchasable there under.

    

    Date:_______________________________

    
      
         

      

      
        11SETTLEMENT AND RELEASE
AGREEMENT

      

      I.  DEFINITIONS

      

      As set
forth in this Settlement and Release Agreement, certain terms are defined as
follows:

       

      1.01.    “Faria”
means Rhonda Faria,
also known as Rhonda Ramich, individually and her successors, agents,
representatives, executors, administrators and assigns.

       

      1.02.    “AccountAbilities”
means AccountAbilities, Inc. and all of its respective officers, directors,
shareholders, parents, subsidiaries and otherwise affiliated companies, agents,
employees, contractors, attorneys, insurance companies, and any other person or
entity who is or may be liable for any payments or damages that Faria alleges
may have occurred as a result of the Dispute between the Parties, as defined in
sections 1.04 and 1.05 below.

       

      1.03.     “Agreement”
means this Settlement and Release Agreement.

       

      1.04.    “Parties”
mean Faria and AccountAbilities as defined in the preceding paragraphs, and
“Party” refers individually to each of the Parties.

       

      1.05.   The
“Dispute” refers to allegations regarding a purported breach by AccountAbilities
of the Asset Purchase Agreement between AccountAbilities and Faria dated
February 26, 2007, the exhibits, attachments, and ancillary agreements, if any,
thereto and payments owed to Faria under the $150,000 cash reserve established
separately from the Asset Purchase Agreement.

       

      II.  RECITALS

       

      2.01.    AccountAbilities
denies and continues to deny any liability to Faria.  Faria denies and
continues to deny any liability to AccountAbilities.

       

      2.03.    A
disagreement exists among the Parties both as to liability and amount of
damages, if any, that are due because of the Dispute.  The Parties desire
to dispose of the entire controversy and disagreement between and among them,
including any and all claims and/or causes of action of any kind whatsoever that
currently exist or that may exist in the future that relate in any way to the
Dispute.

       

      2.04.    This
document is intended to be a full, final, and complete release of any and all
claims or potential claims against AccountAbilities that concern the alleged
damages and/or injuries to Faria that arise from or relate to the Dispute. The Parties
agree as follows:

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

       

      III.  WARRANTIES,
REPRESENTATIONS AND AGREEMENTS

       

      3.01.    The
Parties acknowledge that full, valid and binding consideration exists for the
execution of this Agreement, and that such consideration includes the mutual
promises, warranties and representations made in this Agreement.

       

      3.02.    The
Parties acknowledge and agree that the warranties, representations and
agreements made in this Agreement are contractual in nature.

       

      3.03.    By
entering into, or otherwise acting under, this Agreement, none of the Parties
shall be deemed to have made an admission of responsibility or any liability
with respect to the Dispute.  Nothing in this Agreement shall be taken
or construed as an inference or admission by any party or as evidence indicating
the truth or correctness of any claim or defense by any other person or entity,
whether or not a party to this Agreement.

       

      3.04.    Each
Party acknowledges and agrees that in entering into this Agreement it has not
relied on any warranties, promises, or representations of any kind, express or
implied, other than those expressly set forth in this Agreement.

       

      3.05.    Faria
acknowledges that she may discover facts relating to the Dispute that occurred
prior to the date of this Agreement that are different from, or in addition to,
those which she now knows or believes to be true, and the Parties agree that
this Agreement shall be, and remains effective and applicable in all respects,
notwithstanding such different or additional facts or the discovery thereof, and
that the Parties are not relying upon any representation or any duty of any
Party to make any other representation or warranty, and Faria will not assert in
the future any claim of a duty of AccountAbilities to make any
disclosure.

       

      3.06    AccountAbilities
will pay Faria $545,000 (the “Settlement Amount”) in full satisfaction of all
outstanding obligations (whether evidenced by one or more Promissory Notes or
otherwise arising under any agreement between AccountAbilities and Faria) due
from AccountAbilities.  The sum will be paid as follows:

       

      a.             
$25,000 on the date the Agreement is fully executed;

       

      b.            
Payments of $25,000, the first which shall be due thirty (30) days after the
Agreement is fully executed, the second of which will be due sixty (60) days
after the Agreement is fully executed, and the remaining payments will be made
every sixty (60) days from the Second Payment;

       

      c.            
Additional payments of $5,000 per week starting one week (seven calendar days)
from the date the Agreement is fully executed;

       

      d.            
The payments shall be made according to the Payment Schedule attached hereto as
Exhibit A.

       

      Faria
hereby acknowledges that any outstanding Notes and reserve funds between
AccountAbilities and Faria and AccountAbilities and ReStaff Services, Inc. are
hereby cancelled and void, including any claimed payments owed as to interest,
fees and penalties.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

       

      3.07    Faria
currently holds certificates representing 750,000 shares of AccountAbilities
Common Stock, $.0001 par value (the “Shares”).  Within ten (10)
business days from the date the Agreement is fully executed, AccountAbilities
will direct the Transfer Agent to deliver the shares to Faria with the
restrictive legends removed.  The provisions and agreements set forth
in this Section 3.07 are subject to the following restrictions:

       

      a.            
For the period of two years from the date the Agreement is fully executed, not
more than 100,000 of the Shares may be sold in any ninety (90) day period on the
open market.

       

      b.            
Tri-State shall have the right of first refusal on Faria’s sale of any of the
shares to be sold in a private transaction.  Prior to any proposed
sale of the shares in a private transaction to a third-party, unrelated bona
fide purchaser for value, Faria shall provide AccountAbilities with written
notice of the proposed sale and the terms of the
sale.  AccountAbilities will have ten (10) days from receipt of
Faria’s notification to inform Faria as to whether AccountAbilities will
exercise its right of first refusal. Should it choose to exercise its right of
first refusal, AccountAbilities shall be entitled to purchase the shares
referenced within Faria’s notice in accordance with the terms and conditions set
forth within the same.

       

      3.08    AccountAbilities
hereby agrees to employ Faria to work in the Seattle, Washington area, pursuant
to the terms of the Employment Agreement, attached hereto as Exhibit B and to be
executed simultaneously herewith.

       

      a.            
AccountAbilities also agrees to pay up to $40,000 a year to employ one
additional person in Faria’s office (the “Faria Employee”).  The Faria
Employee will be an at-will employee subject to the terms of employment
established by the President of AccountAbilities.

       

      b.            
This Agreement, however, is not conditioned upon either Faria’s or the Faria
Employee’s continued employment with AccountAbilities.  The terms of
the Agreement continue to be in effect regardless of Faria’s or Faria’s
Employee’s termination or voluntary resignation.

       

      IV.    RELEASE
OF ALL CLAIMS

       

      4.01.   In
consideration of the promises and agreements in this Agreement, including the
recitals referenced above, Faria releases, acquits, and forever discharges
AccountAbilities and all other persons, firms or corporations with whom they
have been, are now, or may be affiliated with from any and all claims or causes
of action of any kind whatsoever, at common law, statutory or otherwise that
Faria has or might have, known or unknown, now existing or that might arise,
including, but not limited to, those directly or indirectly attributable to
Dispute that could have been brought in any lawsuit, whether equitable or
otherwise, administrative action or hearing, arbitration, mediation or any other
type of civil or common law action for damages, equitable or injunctive relief;
it being intended by Faria to release all claims of any kind which she might
have against AccountAbilities.  This Release includes a release of all
claims and causes of action arising out of or related to the Dispute for all
claims or causes of action that have not been specifically identified, that
currently exist or that may exist or accrue in the future that relate in any way
to the Dispute.

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

      4.02.    Faria
recognizes that there may be claims or damages arising out of the Dispute that
are unknown to her at the time of execution of this Agreement, or that may arise
in the future.  Faris has negotiated this Agreement with full
knowledge of the possibility that additional claims or damages may arise or
become known to Faria after the execution of this Agreement, and Faria intends
this Agreement to settle and finally dispose of all such claims or injuries,
whether known or unknown.

      

      4.03.    In
consideration of the execution of this Agreement, and for other good and
valuable consideration, receipt of which is acknowledged, Faria waives any and
all rights under California Civil Code section 1542, which provides as
follows:

       

      A GENERAL
WAIVER DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS FAVOR AT THE TIME OF THE EXECUTING THE RELEASE, WHICH IF KNOWN BY
HIM MUST HAVE MUTUALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

       

      V.  CONFIDENTIALITY
AGREEMENT

       

      5.01.    For
further consideration of the sums paid by or on behalf of AccountAbilties, Faria
represents and promises on her behalf and all parties related to her, including,
but not limited to her agents, representatives, employees, servants, assigns and
attorneys that the settlement and release, including the agreements, terms,
numbers, sums, promises, undertakings, representations, acknowledgments,
statements or other actions taken by Faria and/or AccountAbilities pursuant to
the terms of this Agreement shall be kept STRICTLY
CONFIDENTIAL, except as required by law to be disclosed, and shall be
forever binding upon Faria.  Specifically, except as required by law to be
disclosed, Faria agrees that the  amount of the consideration received, and
all of the terms, releases, agreements, promises, undertakings, representations,
acknowledgments, statements or other actions made and/or taken pursuant to the
terms of this Agreement, shall be kept STRICTLY
CONFIDENTIAL and Faria specifically warrants, agrees and represents that
she will not disclose the terms and conditions of this Agreement to any person
or entity unless specifically required by law to make such disclosure in
response to a legal requirement or process such as a subpoena, court order, tax
audit or statute, to persons Faria hire to seek financial or tax advice or any
lien holder; that Faria will not provide or file or seek to provide or file or
permit another to provide or file this Agreement with any court, regulatory or
licensing authority, governmental agency or accrediting commission or authority
unless required to do so by law.  The laws of the State of California
shall govern this Confidentiality Agreement.

       

      VI.  GENERAL
PROVISIONS

       

      6.01.    Waiver
and Modification.  This Agreement may only be modified,
changed, amended or waived by a subsequent written agreement signed by an
authorized representative of each of the Parties to this
Agreement.  No waiver of default of any term of this Agreement will be
deemed a waiver of any subsequent breach or default of the same or similar
nature.

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

       

      6.02.    Governing
Law.  This Agreement must be construed and enforced in
accordance with the laws of the State of California.

       

      6.03.    Agreement
Prepared Jointly by all Parties’ Attorneys.  This Agreement has
been negotiated by the Parties and prepared by the joint efforts of the
respective attorneys for each of the Parties.  The Parties warrant,
represent, and agree that they are not relying on the advice of the other Party
or that Party’s attorneys, or anyone else associated with them as to the legal
consequences of this Agreement as so structured.  Furthermore, Faria
releases and discharges all claims, rights, damages, costs or expenses of any
nature whatsoever that may accrue to or be acquired by Faria by reason of the
legal consequences of this Agreement as structured.

       

      6.04.    Acknowledgment
of Entire Agreement.  Each party acknowledges that he or she
has carefully read this instrument including all documents or exhibits to which
it refers; that this instrument expresses the entire agreement between and among
the Parties concerning the subjects it purports to cover; and that each party
has executed this instrument freely and of his or her own accord, and that it
shall be binding upon and inure to the benefit of the executors, administrators,
personal representatives, heirs, successors and assigns of each.

       

      6.05.    Partial
Invalidity.  If any provision of the Agreement is or may be
held by a court of competent jurisdiction to be invalid, void, or unenforceable,
the remaining provisions shall nevertheless survive and continue in full force
and effect without being impaired or invalidated in any way.

       

      6.06.    Warranty
of Capacity to Execute Agreement.  Faria represents and
warrants that no other person or entity has or has had any interest in the
claims, demands, obligations or causes of action referred to in this Agreement;
that Faria has the sole and exclusive right to receive sums specified in it; and
that Faria has not sold, assigned, transferred, conveyed or otherwise disposed
of any of the claims, demands, obligations or causes of action referred to in
this Agreement.  Faria further warrants that she has read this
Agreement and fully understand it to be a compromise and settlement and release
of all claims, known or unknown, present or future, that she has or may have
against AccountAbilities, arising out of the matters described.

       

      6.07.    Disclaimer
of Liability.  Faria agrees and acknowledges that she accepts
payment of the sums specified in this Agreement as a full and complete
compromise of matters involving disputed issues; that neither payment of the
sums specified nor the negotiations for this settlement (including all
statements, admissions or communications) by any of the Parties or their
attorneys or representatives shall be considered as an admission by any of the
Parties; and that no past or present wrong doing on their part shall be implied
by such payment or negotiations.

       

      6.08.    Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which together shall constituted one and the same
instrument.  The Parties agree that a facsimile or PDF signature shall
have the same legal force and effect as receipt of an original
signature.

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

       

      6.09.    Additional
Documents.  The Parties agree to cooperate fully, and execute
any and all supplementary documents, and take all additional actions that may be
necessary or appropriate to give full force and effect to the terms and intent
of this Agreement, which are not inconsistent with its terms.

       

      6.10.    Effectiveness.  This
Agreement shall become effective immediately following execution by all of the
Parties.

       

      6.11    Dispute
Resolution Procedure.  In the event of a claimed breach of the
terms of this Agreement, the complaining Party shall notify the other party of
the purported breach.  If the Parties cannot informally resolve the
matter, jurisdiction for any suit arising out of the purported breach of this
Agreement lies in the United States Federal Court, Northern District Court of
California, San Francisco Division.

       

      APPROVED
AND EXECUTED this 5th day of February, 2010.

       

      Rhonda
Faria, also known as Rhonda Ramich

      

      
        	
                By: 

              	
                /s/ Rhonda Faria

              	 
      	
                February
      5, 2010

              

      

      

      Notary

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      ReStaff
Services, Inc.

      

      
        	
                By:

              	
                /s/ Rhonda Faria

              	 
      	
                February
      5, 2010

              
	 
      	 
      	 
      	 
      
	
                Title: 

              	
                President

              	 
      	 
      

      

      

      Notary

      

      AccountAbilities,
Inc.

      

      
        
          
            	
                    By:

                  	
                    /s/ Jay H. Schecter

                  	 
      	
                    February
      5, 2010

                  
	 	 	 	 
	
                    Title: 

                  	
                    Chief Executive Officer

                  	 
      	 
      

          

        

      

      

      Notary

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      EXHIBIT
A

      Payment
Schedule

      

      
        
          
            	
                    2/12/10

                  	 	$	5,000	 
	
                    2/19/10

                  	 	$	5,000	 
	
                    2/26/10

                  	 	$	5,000	 
	
                    3/5/10

                  	 	$	30,000	 
	
                    3/12/10

                  	 	$	5,000	 
	
                    3/19/10

                  	 	$	5,000	 
	
                    3/26/10

                  	 	$	5,000	 
	
                    4/2/10

                  	 	$	5,000	 
	
                    4/6/10

                  	 	$	25,000	 
	
                    4/9/10

                  	 	$	5,000	 
	
                    4/16/10

                  	 	$	5,000	 
	
                    4/23/10

                  	 	$	5,000	 
	
                    4/30/10

                  	 	$	5,000	 
	
                    5/7/10

                  	 	$	5,000	 
	
                    5/14/10

                  	 	$	5,000	 
	
                    5/21/10

                  	 	$	5,000	 
	
                    5/28/10

                  	 	$	5,000	 
	
                    6/4/10

                  	 	$	30,000	 
	
                    6/11/10

                  	 	$	5,000	 
	
                    6/18/10

                  	 	$	5,000	 
	
                    6/25/10

                  	 	$	5,000	 
	
                    7/2/10

                  	 	$	5,000	 
	
                    7/9/10

                  	 	$	5,000	 
	
                    7/16/10

                  	 	$	5,000	 
	
                    7/23/10

                  	 	$	5,000	 
	
                    7/30/10

                  	 	$	5,000	 
	
                    8/4/10

                  	 	$	25,000	 
	
                    8/6/10

                  	 	$	5,000	 
	
                    8/13/10

                  	 	$	5,000	 
	
                    8/20/10

                  	 	$	5,000	 
	
                    8/27/10

                  	 	$	5,000	 
	
                    9/3/10

                  	 	$	5,000	 
	
                    9/10/10

                  	 	$	5,000	 
	
                    9/17/10

                  	 	$	5,000	 
	
                    9/24/10

                  	 	$	5,000	 
	
                    10/1/10

                  	 	$	30,000	 
	
                    10/8/10

                  	 	$	5,000	 
	
                    10/15/10

                  	 	$	5,000	 
	
                    10/22/10

                  	 	$	5,000	 
	
                    10/29/10

                  	 	$	5,000	 
	
                    11/5/10

                  	 	$	5,000	 
	
                    11/12/10

                  	 	$	5,000	 

          

        

      

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      

      
        
          
            
              
                	
                        11/19/10

                      	 	$	5,000	 
	
                        11/24/10

                      	 	$	5,000	 
	
                        12/3/10

                      	 	$	30,000	 
	
                        12/10/10

                      	 	$	5,000	 
	
                        12/17/10

                      	 	$	5,000	 
	
                        12/24/10

                      	 	$	5,000	 
	
                        12/31/10

                      	 	$	5,000	 
	
                        1/7/11

                      	 	$	5,000	 
	
                        1/14/11

                      	 	$	5,000	 
	
                        1/21/11

                      	 	$	5,000	 
	
                        1/28/11

                      	 	$	5,000	 
	
                        1/31/11

                      	 	$	25,000	 
	
                        2/4/11

                      	 	$	5,000	 
	
                        2/11/11

                      	 	$	5,000	 
	
                        2/18/11

                      	 	$	5,000	 
	
                        2/25/11

                      	 	$	5,000	 
	
                        3/4/11

                      	 	$	5,000	 
	
                        3/11/11

                      	 	$	5,000	 
	
                        3/18/11

                      	 	$	5,000	 
	
                        3/25/11

                      	 	$	5,000	 
	
                        4/1/11

                      	 	$	30,000	 
	
                        4/8/11

                      	 	$	5,000	 
	
                        4/15/11

                      	 	$	5,000	 
	
                        4/22/11

                      	 	$	5,000	 
	
                        4/29/11

                      	 	$	5,000	 
	 
      	 	 	 	 
	
                        Total

                      	 	$	520,000.00	 

              

            

          

        

      

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      EXHIBIT
B

      (Employment
Agreement)

      

      See
Attached

       

      
        
          
          

        

        
          10

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