Document:

Registration Rights Agreement

     

    
      

      

    

    Exhibit
      10.1

     

    REGISTRATION
      RIGHTS AGREEMENT

     

     

     THIS
      REGISTRATION RIGHTS AGREEMENT
      (the
“Agreement”)
      is
      entered into this         
      day
      of
      September 2006, by and among ZONE MINING LIMITED, a Delaware corporation (the
      “Company”),
      and
      each of the shareholders set forth on the signature pages hereto (each, a
“Shareholder”
and
      collectively, the “Shareholders”).

     

    RECITALS

     

    WHEREAS, the
      Company, ZM Acquisition Corp., a Delaware corporation (“Merger
      Sub”),
      Driveitaway Inc., a Delaware corporation (“DIA”),
      Stonewell Partners LLP, the principal shareholder of DIA, are parties to that
      certain Agreement and Plan of Merger dated September ____, 2006 (the
“Merger
      Agreement”);
      

     

    WHEREAS,
      pursuant to Article I of the Merger Agreement, the parties to the Merger
      Agreement contemplate the merger of Merger Sub with and into DIA (the
“Merger”),
      with
      DIA as the surviving company; and

     

    WHEREAS,
      in
      connection with the consummation of the Merger, the parties desire to enter
      into
      this Agreement in order to grant registration rights to the Shareholders as
      set
      forth below.

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual promises, representations, warranties, covenants
      and
      conditions set forth in this Agreement, the parties agree hereto as
      follows:

     

    
      	1.  	
              General.
                For
                the purpose of this Agreement, the following definitions shall
                apply:

            

    

     

    1.1.
      “Common
      Stock”
shall
      mean shares of common stock, $.00001 par value per share, of the
      Company.

     

    1.2. “Exchange
      Act”
shall
      mean the Securities Exchange Act of 1934, as amended, as the same shall be
      in
      effect at the time.

     

    1.3.
      “Lock
      Up Termination Date”
shall
      have the meaning set forth in Section 3 hereof. 

     

    1.4.
      “Person”
shall
      mean an individual, partnership (general or limited), corporation, limited
      liability company, joint venture, business trust, cooperative, association
      or
      other form of business organization, whether or not regarded as a legal entity
      under applicable law, a trust (inter vivos or testamentary), an estate of a
      deceased, insane or incompetent person, a quasi-governmental entity, a
      government or any agency, authority, political subdivision or other
      instrumentality thereof, or any other entity.

     

    1.5.
      “Register,”
      “registered,”
and
      “registration”
shall
      refer to a registration effected by preparing and filing a registration
      statement in compliance with the Securities Act, and the declaration or order
      of
      effectiveness of such registration statement or document by the
      SEC.

     

    
      
        
        

      

      
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    1.6.
      “Registration
      Statement”
shall
      mean any registration statement of the Company filed with the SEC pursuant
      to
      the provisions of Section 2.1 of this Agreement, which covers the resale of
      the
      Restricted Stock on an appropriate form then permitted by the SEC to be used
      for
      such registration and the sales contemplated to be made thereby under the
      Securities Act, or any similar rule that may be adopted by the SEC, and all
      amendments and supplements to such registration statement, including any pre-
      and post- effective amendments thereto, in each case including the prospectus
      contained therein, all exhibits thereto and all materials incorporated by
      reference therein.

     

    1.7.
      “Restricted
      Stock”
shall
      mean (i) the shares of Common Stock issuable to the Shareholders under Section
      1.2(b) of the Merger Agreement; and (ii) any additional shares of Common Stock
      issued or issuable in respect of any of the foregoing securities, by way of
      a
      stock dividend or stock split; provided that as to any particular shares of
      Restricted Stock, such securities shall cease to constitute Restricted Stock
      when (x) a Registration Statement with respect to the sale of such securities
      shall have become effective under the Securities Act and such securities shall
      have been disposed of thereunder, (y) such securities are permitted to be
      transferred pursuant to Rule 144 (or any successor provision to such rule)
      under
      the Securities Act without restriction as to volume or (z) such securities
      are
      otherwise freely transferable to the public without further registration under
      the Securities Act.

     

    1.8.
      “SEC”
or
      “Commission”
shall
      mean the Securities and Exchange Commission.

     

    1.9.
      “Securities
      Act”
shall
      mean the Securities Act of 1933, as amended, as the same shall be in effect
      at
      the time.

     

    1.10.“Selling
      Shareholders”
shall
      mean each Shareholder and their respective successors and assigns whose shares
      are included or requested to be included in a Registration
      Statement.

     

    
      	2.  	
              Registration
                Rights.
                Each Shareholder shall be entitled to the rights and subject to the
                obligations set forth below:

            

    

     

    2.1. Registration
      of the Shares.

     

    (a) The
      Company shall notify all Shareholders in writing at least ten (10) days
      prior to the filing of any registration statement under the Securities Act
      for
      purposes of registering securities of the Company, excluding registration
      statements on SEC Forms S-4, S-8 or any similar or successor forms, and will
      afford each such Shareholder an opportunity to include in such registration
      statement all or part of such Restricted Stock held by such Shareholder. Each
      Shareholder desiring to include in any such registration statement all or any
      part of the Restricted Stock held by it shall, within ten (10) days after the
      above-described notice from the Company, so notify the Company in writing.
      Such
      notice shall state the intended method of disposition of the Restricted Stock
      by
      such Shareholder. If a Shareholder decides not to include all of its Restricted
      Stock in such registration statement, such Shareholder shall nevertheless
      continue to have the right to include any Restricted Stock in any subsequent
      registration statement or registration statements as may be filed by the Company
      with respect to offerings of its securities, all upon the terms and conditions
      set forth herein. The Company may, without the consent of the Shareholders,
      withdraw such registration statement prior to its becoming effective if the
      proposal to register the securities proposed to be registered thereby is
      abandoned.

     

    
      
        
        

      

      
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    (b)
       In
      the
      event that any registration pursuant to Section 2.1(a) shall be, in whole or
      in
      part, an underwritten public offering of Common Stock on behalf of the Company,
      all Shareholders proposing to distribute their Restricted Stock through such
      underwriting shall enter into an underwriting agreement in customary form with
      the underwriter or underwriters selected for such underwriting by the Company.
      If the managing underwriter thereof advises the Company in writing that in
      its
      opinion the number of securities requested to be included in such registration
      exceeds the number which can be sold in an orderly manner in such offering
      within a price range acceptable to the Company, the Company shall include in
      such registration (i) first, the securities the Company proposes to sell, (ii)
      second, securities held by person with demand or mandatory registration rights
      and (iii) third, the Restricted Stock and any other securities eligible and
      requested to be included in such registration to the extent that the number
      of
      shares to be registered under this clause (iii) will not, in the opinion of
      the
      managing underwriter, adversely affect the offering of the securities pursuant
      to clause (i) or (ii). In such a case, shares shall be registered pro rata
      among
      the holders of such Restricted Stock and other securities on the basis of the
      number of shares eligible for registration that are owned by all such holders
      and requested to be included in such registration. 

     

    (c) Notwithstanding
      anything to the contrary contained herein, the Company's obligation in Sections
      2.1(a) and 2.1(b) above shall extend only to the inclusion of the Restricted
      Stock in a Registration Statement. The Company shall have no obligation to
      assure the terms and conditions of distribution, to obtain a commitment from
      an
      underwriter relative to the sale of the Restricted Stock or to otherwise assume
      any responsibility for the manner, price or terms of the distribution of the
      Restricted Stock. 

     

    (d) The
      Company shall have the right to terminate or withdraw any registration initiated
      by it under this Section 2.1 prior to the effectiveness of such registration
      without thereby incurring liability to the holders of the Restricted Stock,
      regardless of whether any Shareholder has elected to include securities in
      such
      registration. The Registration Expenses (as defined in Section 2.4) of such
      withdrawn registration shall be borne by the Company in accordance with
      Section 2.4 hereof.

     

    2.2. Registration
      Procedures.
      Whenever it is obligated to register any Restricted Stock pursuant to this
      Agreement, the Company shall:

     

    (a) prepare
      and file with the SEC a Registration Statement with respect to the Restricted
      Stock in the manner set forth in Section 2.1 hereof and use its reasonable
      best
      efforts to cause such Registration Statement to become effective as promptly
      as
      possible and to remain effective until the earlier of (i) the sale of all shares
      of Restricted Stock covered thereby, (ii) the availability under Rule 144 for
      the Selling Shareholder to immediately, freely resell without restriction all
      Restricted Stock covered thereby, or (iii) two (2) years from the date of this
      Agreement;

     

    
      
        
        

      

      
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    (b) prepare
      and file with the SEC such amendments (including post-effective amendments)
      and
      supplements to such Registration Statement and the prospectus used in connection
      therewith as may be necessary to keep such Registration Statement effective
      for
      the period specified in Section 2.2(a) above and to comply with the provisions
      of the Securities Act with respect to the disposition of all Restricted Stock
      covered by such Registration Statement in accordance with the intended method
      of
      disposition set forth in such Registration Statement for such
      period;

     

    (c) furnish
      to the Selling Shareholders such number of copies of the Registration Statement
      and the prospectus included therein (including each preliminary prospectus)
      as
      such person may reasonably request in order to facilitate the public sale or
      other disposition of the Restricted Stock covered by such Registration
      Statement;

     

    (d) use
      its
      reasonable best efforts to register or qualify the Restricted Stock covered
      by
      such Registration Statement under the state securities laws of such
      jurisdictions as any Selling Shareholder shall reasonably request; provided,
      however,
      that
      the Company shall not for any such purpose be required to qualify generally
      to
      transact business as a foreign corporation in any jurisdiction where it is
      not
      so qualified or to consent to general service of process in any such
      jurisdiction;

     

    (e) in
      the
      event of any underwritten public offering, enter into and perform its
      obligations under an underwriting agreement, in usual and customary form, with
      the managing underwriter(s) of such offering. Each Selling Shareholder
      participating in such underwriting shall also enter into and perform its
      obligations under such an agreement, as described in Section
      2.1(b);

     

    (f) immediately
      notify each Selling Shareholder at any time when a prospectus relating thereto
      is required to be delivered under the Securities Act, of the happening of any
      event as a result of which the prospectus contained in such Registration
      Statement, as then in effect, includes an untrue statement of a material fact
      or
      omits to state a material fact required or necessary to be stated therein in
      order to make the statements contained therein not misleading in light of the
      circumstances under which they were made. The Company will use reasonable
      efforts to amend or supplement such prospectus in order to cause such prospectus
      not to include any untrue statement of a material fact or omit to state a
      material fact required to be stated therein or necessary to make the statements
      therein not misleading in the light of the circumstances under which they were
      made;

     

    (g) prepare
      and file with the SEC such amendments and supplements to such Registration
      Statement and the prospectus used in connection with such Registration Statement
      as may be necessary to comply with the provisions of the Securities Act with
      respect to the disposition of all securities covered by such Registration
      Statement;

     

    (h) use
      its
      reasonable best efforts to list the Restricted Stock covered by such
      Registration Statement on each exchange or automated quotation system on which
      similar securities issued by the Company are then listed (with the listing
      application being made at the time of the filing of such Registration Statement
      or as soon thereafter as is reasonably practicable); 

     

    
      
        
        

      

      
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    (i) notify
      each Selling Shareholder of any threat by the SEC or state securities commission
      to undertake a stop order with respect to sales under the Registration
      Statement; and 

     

    (j) cooperate
      in the timely removal of any restrictive legends from the shares of Restricted
      Stock in connection with the resale of such shares covered by an effective
      Registration Statement.

     

     

    2.3. Delay
      of Registration. 
      No
      Selling Shareholder shall have any right to obtain or seek an injunction
      restraining or otherwise delaying any such registration as the result of any
      controversy that might arise with respect to the interpretation or
      implementation of this Agreement.

     

    2.4 Expenses.

     

    (a) For
      the
      purposes of this Section 2.4, the term “Registration
      Expenses”
shall
      mean: all expenses incurred by the Company in complying with Section 2.1 and
      2.2
      of this Agreement, including, without limitation, all registration and filing
      fees, printing expenses, fees and disbursements of counsel and independent
      public accountants for the Company, fees under state securities laws, fees
      of
      the National Association of Securities Dealers, Inc. (“NASD”),
      fees
      and expenses of listing shares of Restricted Stock on any securities exchange
      or
      automated quotation system on which the Company's shares are listed and fees
      of
      transfer agents and registrars. The term “Selling
      Expenses”
shall
      mean: all underwriting discounts and selling commissions applicable to the
      sale
      of Restricted Stock and all accountable or non-accountable expenses paid to
      any
      underwriter in respect of such sale.

     

    (b) Except
      as
      otherwise provided herein, the Company will pay all Registration Expenses in
      connection with any Registration Statement filed pursuant to Section 2.1 of
      this
      Agreement. All Selling Expenses in connection with any Registration Statement
      filed pursuant to Section 2.1 of this Agreement shall be borne by the Selling
      Shareholders pro rata on the basis of the number of shares registered by each
      Selling Shareholder whose shares of Restricted Stock are covered by such
      Registration Statement, or by such persons other than the Company (except to
      the
      extent the Company may be a seller) as they may agree.

     

    2.5. Obligations
      of the Selling Shareholders.

     

    (a) In
      connection with each registration hereunder, each Selling Shareholder will
      furnish to the Company in writing such information with respect to it and the
      securities held by it and the proposed distribution by it, as shall be
      reasonably requested by the Company in order to assure compliance with
      applicable federal and state securities laws as a condition precedent to
      including the Selling Shareholder's Restricted Stock in the Registration
      Statement. Each Selling Shareholder shall also promptly notify the Company
      of
      any changes in such information included in the Registration Statement or
      prospectus as a result of which there is an untrue statement of material fact
      or
      an omission to state any material fact required or necessary to be stated
      therein in order to make the statements contained therein not misleading in
      light of the circumstances under which they were made.

     

    
      
        
        

      

      
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    (b) In
      connection with the filing of the Registration Statement, each Selling
      Shareholder shall furnish to the Company in writing such information and
      affidavits as the Company reasonably requests for use in connection with such
      Registration Statement or prospectus.

     

    (c) In
      connection with each registration pursuant to this Agreement, each Selling
      Shareholder agrees that it will not effect sales of any Restricted Stock
      pursuant to the Registration Statement until notified by the Company of the
      effectiveness of the Registration Statement, and thereafter will suspend such
      sales pursuant to the Registration Statement after receipt of telegraphic or
      written notice from the Company to suspend sales to permit the Company to
      correct or update a Registration Statement or prospectus. At the end of any
      period during which the Company is obligated to keep a Registration Statement
      current, each Selling Shareholder shall discontinue sales of Restricted Stock
      pursuant to such Registration Statement upon receipt of notice from the Company
      of its intention to remove from registration the Restricted Stock covered by
      such Registration Statement that remains unsold, and each Selling Shareholder
      shall notify the Company of the number of shares registered which remain unsold
      immediately upon receipt of such notice from the Company.

     

    2.6. Information
      Blackout and Holdbacks.

     

    (a) At
      any
      time when a Registration Statement effected pursuant to Section 2.1 is
      effective, upon written notice from the Company to a Selling Shareholder that
      the Company has determined in good faith that the sale of Restricted Stock
      pursuant to the Registration Statement would require disclosure of non-public
      material information, such Selling Shareholder shall suspend sales of Restricted
      Stock pursuant to such Registration Statement until such time as the Company
      notifies the Selling Shareholders that such material information has been
      disclosed to the public or has ceased to be material, or that sales pursuant
      to
      such Registration Statement may otherwise be resumed.

     

    (b) Notwithstanding
      any other provision of this Agreement, in the event that the Company undertakes
      a primary offering of shares of its unissued Common Stock, which may also
      include other securities, excluding a primary offering related to an employee
      benefit plan (a “Primary
      Offering”),
      in
      which all of the shares of Restricted Stock are not included, each Shareholder
      shall not sell, transfer, make any short sale of, grant any option for the
      purchase of, or enter into any hedging or similar transaction with the same
      economic effect as a sale of, any Common Stock (or other securities) of the
      Company held by such Shareholder (except for shares included in the Primary
      Offering), during the thirty (30) days prior to the commencement of any such
      Primary Offering and ending one hundred fifty (150) days after completion of
      any
      such Primary Offering, unless the Company, in the case of a non-underwritten
      Primary Offering, or the managing underwriter, in the case of an underwritten
      Primary Offering, otherwise agrees in writing. The Company may impose
      stop-transfer instructions with respect to the shares of Common Stock (or other
      securities) subject to the foregoing restriction until the end of said one
      hundred fifty (150) day period. 

     

    
      
        
        

      

      
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    2.7. Indemnification.

     

    (a) To
      the
      extent permitted by law, the Company shall indemnify, each Selling Shareholder,
      such Selling Shareholder’s respective partners, officers, directors,
      underwriters and each Person who controls any Selling Shareholder (within the
      meaning of the Securities Act) against all losses, claims, damages, liabilities
      and expenses caused by (i) any untrue statement of or alleged untrue statement
      of material fact contained in the Registration Statement, prospectus or
      preliminary prospectus or any amendment or supplement thereto, (ii) any omission
      of or alleged omission of a material fact required to be stated therein or
      necessary to make the statements therein not misleading, or (iii) any violation
      or alleged violation by the Company of the Securities Act, the Exchange Act,
      any
      state securities law or any rule or regulation promulgated under the Securities
      Act, the Exchange Act or any state securities law in connection with the
      offering covered by such registration statement (“Violations”);
      provided,
      however,
      that
      the indemnity agreement contained in this Section 2.7(a) shall not apply to
      amounts paid in settlement of any such loss, claim, damage, liability or action
      if such settlement is effected without the consent of the Company, which consent
      shall not be unreasonably withheld, nor shall the Company be liable in for
      any
      loss, claim, damage, liability or action to the extent that it arises out of
      or
      is based upon a Violation which occurs in reliance upon and in conformity with
      written information furnished expressly for use in connection with such
      registration by such Selling Shareholder, partner, officer, director,
      underwriter or controlling person of such Selling Shareholder, occurs as a
      result of any failure to deliver a copy of the prospectus or any amendment
      or
      supplement thereto relating to such Registration Statement, or occurs as a
      result of any disposition of the Restricted Stock in a manner that fails to
      comply with the permitted methods of distribution identified within the
      Registration Statement.

     

    (b) To
      the
      extent permitted by law, each Selling Shareholder shall indemnify and hold
      harmless the Company, each of its directors, its officers and each person,
      if
      any, who controls the Company within the meaning of the Securities Act, any
      underwriter and any other Selling Shareholder selling securities under such
      registration statement or any of such other Selling Shareholder’s partners,
      directors or officers or any person who controls such Selling Shareholder,
      against any losses, claims, damages or liabilities (joint or several) to which
      the Company or any such director, officer, controlling person, underwriter
      or
      other such Selling Shareholder, or partner, director, officer or controlling
      person of such other Selling Shareholder, may become subject under the
      Securities Act, the Exchange Act or other federal or state law, insofar as
      such
      losses, claims, damages or liabilities (or actions in respect thereto) arise
      out
      of or are based upon any Violation, in each case to the extent (and only to
      the
      extent) that such Violation (i) occurs in reliance upon and in conformity with
      written information furnished by such Selling Shareholder to the Company for
      use
      in connection with such registration, (ii) occurs as a result of any failure
      of
      such Selling Shareholder to deliver a copy of the prospectus or any supplement
      relating to such Registration Statement, or (iii) occurs as a result of any
      disposition of the Restricted Stock by such Selling Shareholder in a manner
      that
      fails to comply with the permitted methods of distribution identified within
      the
      Registration Statement.

     

    
      
        
        

      

      
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    (c) Any
      Person entitled to indemnification hereunder shall (i) give prompt written
      notice to the indemnifying party of any claim with respect to which it seeks
      indemnification (provided that the failure to give prompt notice shall not
      impair any Person's right to indemnification hereunder to the extent such
      failure has not prejudiced the indemnifying party), and (ii) unless in such
      indemnified party's reasonable judgment a conflict of interest between such
      indemnified and indemnifying parties may exist with respect to such claim,
      permit such indemnifying party to assume the defense of such claim with counsel
      reasonably satisfactory to the indemnified party. If such defense is assumed,
      the indemnifying party shall not be subject to any liability for any settlement
      made by the indemnified party without its consent (but such consent shall not
      be
      unreasonably withheld). An indemnifying party who is not entitled to, or elects
      not to, assume the defense of a claim shall not be obligated to pay the fees
      and
      expenses of more than one counsel for all parties indemnified by such
      indemnifying party with respect to such claim, unless in the reasonable judgment
      of any indemnified party a conflict of interest may exist between such
      indemnified party and any other of such indemnified parties with respect to
      such
      claim.

     

    (d)
       If
      the
      indemnification provided for in this Section 2.7 is held by a court of
      competent jurisdiction to be unavailable to an indemnified party with respect
      to
      any losses, claims, damages or liabilities referred to herein, the indemnifying
      party, in lieu of indemnifying such indemnified party thereunder, shall to
      the
      extent permitted by applicable law contribute to the amount paid or payable
      by
      such indemnified party as a result of such loss, claim, damage or liability
      in
      such proportion as is appropriate to reflect the relative fault of the
      indemnifying party on the one hand and of the indemnified party on the other
      in
      connection with the violation(s) described in Section 2.7(a) that resulted
      in
      such loss, claim, damage or liability, as well as any other relevant equitable
      considerations. The relative fault of the indemnifying party and of the
      indemnified party shall be determined by a court of law by reference to, among
      other things, whether the untrue or alleged untrue statement of a material
      fact
      or the omission to state a material fact relates to information supplied by
      the
      indemnifying party or by the indemnified party and the parties’ relative intent,
      knowledge, access to information and opportunity to correct or prevent such
      statement or omission; provided,
      that in
      no event shall any contribution by a Selling Shareholder hereunder exceed the
      net proceeds from the offering received by such Selling
      Shareholder.

     

    (e) The
      indemnification provided for under this Agreement shall remain in full force
      and
      effect regardless of any investigation made by or on behalf of the indemnified
      party or any officer, director or controlling Person of such indemnified party
      and shall survive the transfer of securities. The Company also agrees to make
      such provisions as are reasonably requested by any indemnified party for
      contribution to such party in the event the Company's indemnification is
      unavailable for any reason. 

     

    
      	3.  	
              Lock-Up.
                

            

    

     

    Notwithstanding
      any other provision of this Agreement, commencing on the date hereof and
      terminating on the earlier of (i) one (1) year from the date hereof or (ii)
      such
      time as the last sales price or closing price, as applicable, and the daily
      trading volume of the Common Stock, in each case as reported on the principal
      market or exchange on which such shares are then listed, equals or exceeds
      $2.00
      per share and 75,000 shares, respectively, for thirty (30) consecutive trading
      days (the “Lock
      Up Termination Date”),
      each
      Shareholder shall not, without the prior written approval of the Company,
      directly or indirectly (A) offer for sale, sell, or contract to sell, sell,
      offer to sell, or contract to sell any option, warrant, right, or contract
      to
      purchase, purchase, offer to purchase, or contract to purchase any option,
      warrant, right, or contract to sell, grant any option, right or warrant to
      purchase, lend, pledge, hypothecate or otherwise transfer or dispose of,
      directly or indirectly, any of the Restricted Stock or (B) enter into any swap
      or other arrangement that transfers to another, in whole or in part, any of
      the
      economic consequences of ownership of any of the Restricted Stock, whether
      any
      of the transactions described in clause (A) or (B) above is to be settled by
      delivery of Restricted Stock, cash or otherwise. The Company shall provide
      notice to each Shareholder of the Lock Up Termination Date within five (5)
      days
      after the Lock Up Termination Date. The Company will take such steps as may
      be
      necessary to enforce the foregoing provisions and restrict the sale or transfer
      of the Restricted Stock as provided herein including, but not limited to,
      placing a legend on all certificates evidencing the Restricted Stock reflecting
      the forgoing restrictions and notifying its transfer agent to place
      stop
      transfer instructions reflecting the foregoing restrictions on the Company’s
      stock transfer records.

     

    
      
        
        

      

      
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      	4.  	
              Miscellaneous.

            

    

     

    4.1. Governing
      Law.
      This
      Agreement shall be governed by and construed under the laws of the State of
      Delaware as applied to agreements among Delaware residents entered into and
      to
      be performed entirely within Delaware.

     

    4.2. Survival.
      The
      representations, warranties, covenants, and agreements made herein shall survive
      any investigation made by any Shareholder and the closing of the transactions
      contemplated hereby. 

     

    4.3. Successors
      and Assigns.
      Except
      as otherwise expressly provided herein, the provisions hereof shall inure to
      the
      benefit of, and be binding upon, the successors, assigns, heirs, executors,
      and
      administrators of the parties hereto and shall inure to the benefit of and
      be
      enforceable by each person who shall be a holder of Restricted Securities from
      time to time; provided,
      however,
      that
      prior to the receipt by the Company of adequate written notice of the transfer
      of any Restricted Securities specifying the full name and address of the
      transferee, the Company may deem and treat the person listed as the holder
      of
      such shares in its records as the absolute owner and holder of such shares
      for
      all purposes.

     

    4.4. Entire
      Agreement.
      This
      Agreement constitutes the full and entire understanding and agreement between
      the parties with regard to the subject matter hereof and no party shall be
      liable or bound to any other in any manner by any representations, warranties,
      covenants and agreements except as specifically set forth herein.

     

    4.5. Severability.
      In the
      event one or more of the provisions of this Agreement should, for any reason,
      be
      held to be invalid, illegal or unenforceable in any respect, such invalidity,
      illegality, or unenforceability shall not affect any other provisions of this
      Agreement, and this Agreement shall be construed as if such invalid, illegal
      or
      unenforceable provision had never been contained herein.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    4.6. Amendment
      and Waiver.

     

    
      (a)
        Except
        as
        otherwise expressly provided, this Agreement may be amended or modified only
        upon the written consent of the Company and the Shareholders holding a majority
        of the shares of Restricted Stock; provided,
        however,
        that no
        such amendment having a disproportionately adverse effect on any Shareholder
        in
        relation to the other Shareholders may be made without consent of such
        Shareholder.

       

      (b)
        Except as otherwise expressly provided, the
        obligations of the Company and the rights of the Shareholders under this
        Agreement may be waived (either generally or in a particular instance and
        either
        retroactively or prospectively) only with the written consent of the holders
        of
        a majority of the shares of Restricted Stock (determined on an as-converted
        to
        Common Stock basis).

       

      (c)
        Any amendment or waiver effected in accordance
        with this paragraph shall be binding upon each Shareholder and the Company.
        In
        addition, the Company may waive performance of any obligation owing to it,
        as to
        some or all of the Shareholders, or agree to accept alternatives to such
        performance, without obtaining the consent of any Shareholder. 

       

    

    4.7. Notices.
      All
      notices required or permitted hereunder shall be in writing and shall be deemed
      effectively given: (a) upon personal delivery to the party to be notified,
      (b) when sent by confirmed telex or facsimile if sent during normal
      business hours of the recipient, if not, then on the next business day,
      (c) five (5) days after having been sent by registered or certified mail,
      return receipt requested, postage prepaid, or (d) one (1) day after deposit
      with a nationally recognized overnight courier, specifying next day delivery,
      with written verification of receipt. All communications shall be sent to the
      party to be notified at the address set forth on the signature page or at such
      other address as such party may designate by advance written notice to the
      other
      parties hereto.

     

    4.8. Titles
      and Subtitles.
      The
      titles of the sections and subsections of this Agreement are for convenience
      of
      reference only and are not to be considered in construing this
      Agreement.

     

    4.9. Counterparts.
      This
      Agreement may be executed in two or more counterparts and delivered via
      facsimile, each of which shall be deemed to be an original, and all of which
      together shall be deemed to be one and the same instrument.

     

    

    [Signature
      page follows]

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

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

     

    
      	 	 	 
	 	
              ZONE
                MINING LIMITED

            
	 
 	 
 	 
 
	 	By:  	 
	 	
              
                

              

              Stephen
                P. Harrington

              President

            

    

    
 

    

    [Signature
      Page to Registration Rights Agreement]

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    SIGNATURE
      PAGE TO REGISTRATION RIGHTS AGREEMENT

    

    By
      execution and delivery of this signature page, the undersigned hereby agrees
      to
      become a Shareholder, as defined in that certain Registration Rights Agreement
      (“Registration Rights Agreement”) by and among Zone Mining Limited, a Nevada
      corporation (the “Company”), and the Shareholders (as defined therein) dated as
      of September ___, 2006, acknowledges having read the Registration Rights
      Agreement and hereby agrees to become a party to the Registration Rights
      Agreement as a “Shareholder” thereunder and authorizes the signature page to be
      attached to the Registration Rights Agreement or counterparts
      thereof.

    

    Executed
      in counterpart, as of the date set forth below.

     

    
      	 	 	 
	 	
              SHAREHOLDER

            
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Name
              of Purchaser
	 	 
	 	Address:
	 	
              
                

              

               

              
                

              

               

              
                

              

            

12Securities Purchase Agreement

    
      

      

    

    Exhibit
      10.2

     

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      Securities Purchase Agreement (this “Agreement”)
      is
      dated as of September 21, 2006, by and between ZONE MINING LIMITED, a Nevada
      corporation, along with its wholly-owned subsidiary, ZM ACQUISITION CORP.,
      a
      Delaware corporation (hereinafter referred to as the “Company”),
      and
      each purchaser identified on the signature pages hereto (each, including its
      successors and assigns, a “Purchaser”
and
      collectively the “Purchasers”).
      

     

    WITNESSETH:

     

    WHEREAS,
      subject
      to the terms and conditions set forth in this Agreement and pursuant to an
      exemption from registration contained in Section 4(2) of the Securities Act
      of
      1933, as amended (the “Securities
      Act”)
      and
      Rule 506 promulgated thereunder, the Company desires to issue and sell to
      Purchasers, and Purchasers desire to purchase from the Company, securities
      of
      the Company as more fully described in this Agreement.

     

    NOW,
      THEREFORE, in
      consideration of the mutual covenants contained in this Agreement, and for
      other
      good and valuable consideration the receipt and adequacy of which are hereby
      acknowledged, the Company and Purchasers agree as follows:

     

    ARTICLE
      I.

    DEFINITIONS

     

    1.1  Definitions.
      In
      addition to the terms defined elsewhere in this Agreement: (a) capitalized
      terms
      that are not otherwise defined herein have the meanings given to such terms
      in
      the Debenture(s) (as defined herein), and (b) the following terms have the
      meanings indicated in this Section 1.1:

     

    “Action”
shall
      have the meaning ascribed to such term in Section 3.1(i).

     

    “Affiliate”
means
      any Person that, directly or indirectly through one or more intermediaries,
      controls or is controlled by or is under common control with a Person, as such
      terms are used in and construed under Rule 144 under the Securities
      Act.
      With
      respect to a Purchaser, any investment fund or managed account that is managed
      on a discretionary basis by the same investment manager as Purchaser will be
      deemed to be an Affiliate of such Purchaser.

     

    “Business
      Day”
means
      any day except Saturday, Sunday and any day which shall be a federal legal
      holiday in the United States or a day on which banking institutions in the
      State
      of Texas are authorized or required by law or other government action to
      close.

    

    “Change
      of Control Transaction”
means
      the occurrence after the date hereof of any of (i) an acquisition after the
      date
      hereof by an individual or legal entity or “group” (as described in Rule
      13d-5(b)(1) promulgated under the Exchange Act) of effective control (whether
      through legal or beneficial ownership (as described in Rule 13d-3 of the
      Exchange Act) of capital stock of the Company, by contract or otherwise) of
      in
      excess of 40% of the voting securities of the Company, or (ii) a replacement
      at
      one time or within a one year period of more than one-half of the members of
      the
      Company’s board of directors which is not approved by a majority of those
      individuals who are members of the board of directors on the date hereof (or
      by
      those individuals who are serving as members of the board of directors on any
      date whose nomination to the board of directors was approved by a majority
      of
      the members of the board of directors who are members on the date hereof),
      or
      (iii) the execution by the Company of an agreement to which the Company is
      a
      party or by which it is bound, providing for any of the events set forth above
      in (i) or (ii). Notwithstanding the foregoing, neither (a) a Qualifying
      Transaction occurring simultaneously with the DIA Transaction nor (b) the DIA
      Transaction shall constitute a “Change of Control Transaction for purposes of
      the Transaction Documents.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    

    “Closing”
means
      the closing of the purchase and sale of the Securities pursuant to Section
      2.1.

     

    “Closing
      Date”
means
      the Business Day when all of the Transaction Documents have been executed and
      delivered by the applicable parties thereto, and all conditions precedent to
      (i)
      Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s
      obligations to deliver the Securities have been satisfied or waived. There
      May
      be multiple Closing Dates.

     

    “Commission”
means
      the Securities and Exchange Commission.

     

    “Common
      Stock”
means
      the common stock of Zone Mining, par value $.00001 per share, and any securities
      into which such common stock shall hereinafter have been reclassified
      into.

     

    “Common
      Stock Equivalents”
means
      any securities of the Company which would entitle the holder thereof to acquire
      at any time Common Stock, including without limitation, any debt, preferred
      stock, rights, options, warrants or other instrument that is at any time
      convertible into or exchangeable for, or otherwise entitles the holder thereof
      to receive, Common Stock.

     

    “Company”
means
      Zone Mining Limited, a Nevada corporation, and ZM Acquisition Corp., a Delaware
      corporation, and such reference herein shall, when referring to any obligation
      of the Company shall impose a joint and several obligation on each such
      entity.

     

    “Debentures”
mean
      the 12% Senior Secured Convertible Debentures, in the form of Exhibit
      A.

     

    “Disclosure
      Schedules”
shall
      have the meaning ascribed to such term in Section 3.1 hereof.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    “DIA”
      shall
      mean Driveitaway, Inc., a Delaware corporation.

     

    “DIA
      Security Agreement”
      means
      the Security Agreement, dated as of the date hereof, between DIA and the
      Purchasers, in the form of Exhibit “G” attached hereto. 

     

    “DIA
      Transaction”
      shall
      mean the merger if DIA with ZM Acquisition substantially on the terms set forth
      in Schedule
      1.1
      hereto.

     

    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended.

     

    “Exempt
      Issuance”
means
      the issuance of (a) shares of Common Stock or options to employees, officers,
      consultants or directors of the Company pursuant to any stock or option plan
      currently in place as of the date hereof or adopted in accordance with the
      terms
      of the DIA Transaction which has been duly adopted by the Board of Directors,
      (b) securities upon the exercise of or conversion of any securities issued
      hereunder, convertible securities, options or warrants issued and outstanding
      on
      the date of this Agreement, provided that such securities have not been amended
      since the date of this Agreement to increase the number of such underlying
      shares in connection therewith, (c) securities issued pursuant to acquisitions
      or strategic transactions, provided any such issuance shall only be to a Person
      (or the equity owners of such Person) which is, itself or through its
      subsidiaries, an operating company in a business synergistic with the business
      of the Company and in which the Company receives benefits in addition to the
      investment of funds, but shall not include a transaction in which the Company
      is
      issuing securities primarily for the purpose of raising capital or to an entity
      whose primary business is investing in securities, (d) shares of Common Stock
      or
      Common Stock Equivalents issued in connection with the DIA Transaction, and
      (e)
      shares of Common Stock or Common Stock Equivalents issued in connection with
      the
      first Qualifying Transaction occurring after the date of this
      Agreement.

     

    “Fully
      Diluted Basis”
shall
      mean all Common Stock or Common Stock Equivalents of the Company including
      the
      exercise or conversion of all rights, options, derivative and convertible
      securities and further including the conversion (whether convertible or not)
      of
      all other common or preferred stock equivalents outstanding or required to
      be
      issued by the Company.

     

    “Fundamental
      Transaction”
shall
      mean (A) the Company effects any merger or consolidation of the Company with
      or
      into another Person, (B) the Company effects any sale of all or substantially
      all of its assets in one or a series of related transactions, (C) any tender
      offer or exchange offer (whether by the Company or another Person) is completed
      pursuant to which holders of Common Stock are permitted to tender or exchange
      their shares for other securities, cash or property, or (D) the Company effects
      any reclassification of the Common Stock or any compulsory share exchange
      pursuant to which the Common Stock is effectively converted into or exchanged
      for other securities, cash or property. Notwithstanding the foregoing, the
      DIA
      Transaction shall not constitute a “Fundamental Transaction” for purposes of the
      Transaction Documents.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    “GAAP”
shall
      mean United States generally accepted accounting principles, consistently
      applied.

     

    “Intellectual
      Property”
shall
      have the meaning ascribed to such term in Section 3.1(n).

     

    “Legend
      Removal Date”
shall
      have the meaning ascribed to such term in Section 4.1(c). 

     

    “Liens”
means
      a
      lien, charge, security interest, encumbrance, right of first refusal, preemptive
      right, or other restriction. 

     

    “Material
      Adverse Effect”
shall
      have the meaning assigned to such term in Section 3.1(b) hereof.

     

    “Material
      Permits”
shall
      have the meaning ascribed to such term in Section 3.1(l).

     

    “Maximum
      Rate”
shall
      have the meaning ascribed to such term in Section 6.15.

     

    “Person”
means
      an individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    “Proceeding”
means
      an action, claim, suit, investigation or proceeding (including, without
      limitation, an investigation or partial proceeding, such as a deposition),
      whether commenced or threatened.

     

    “Public
      Offering Date”
means
      the date on which the Company receives gross proceeds equal to at least
      $3,000,000 from a public offering of the Common Stock or Common Stock
      Equivalents which will be traded in the normal course on a Trading
      Market.

     

    “Purchaser
      Party”
shall
      have the meaning ascribed to such term in Section 4.10. 

     

    “Qualifying
      Transaction”
shall
      mean an equity financing wherein the Company receives gross proceeds equal
      to at
      least $1,000,000 from the sale of Common Stock or Common Stock
      Equivalents.

    

    “Registrable
      Securities”
means
      (i) all Underlying Shares (exercised and unexercised); (ii) any securities
      issued or transferred to a Purchaser in connection with or arising out of any
      Transaction Document; and (iii) any securities issued or issuable upon any
      stock
      split, dividend or other distribution recapitalization or similar event with
      respect to the foregoing.

    

    “Registration
      Statement”
means
      a
      registration statement covering the sale or resale of the Registrable
      Securities.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    “Required
      Minimum”
means,
      as of any date, the maximum aggregate number of shares of Common Stock then
      issued or potentially issuable in the future pursuant to the Transaction
      Documents, including any Underlying Shares issuable upon exercise of the Warrant
      or conversion of the Debenture, ignoring any exercise limits set forth
      therein.

     

    “Rule
      144”
means
      Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
      Rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      Rule.

     

    “SBA”
      shall
      have the meaning ascribed to such term in Section 5.1.

     

    “SBA
      Documents”
      shall
      have the meaning ascribed to such term in Section 5.1(b).

     

    “SBIC”
      shall
      have the meaning ascribed to such term in Section 5.1.

     

    “SBIC
      Act”
      shall
      have the meaning ascribed to such term in Section 5.1(a).

     

    “Securities”
means
      the Debenture, the Warrant, and the Underlying Shares.

     

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

     

    “Security
      Agreement”
means
      the Security Agreement, dated as of the date hereof, between the Company and
      the
      Purchasers, in the form of Exhibit
      B
      attached
      hereto.

     

    “Security
      Documents”
shall
      mean the Security Agreement and any other documents and filing required
      thereunder in order to grant Purchasers a first priority security interest
      in
      all of the assets of the Company.

     

    “Subordination
      Agreement”
shall
      mean Subordination Agreements in the form of Exhibit H attached hereto from
      each
      holder of a note or other indebtedness from DIA.

     

    “Subsequent
      Financing”
      shall
      mean any cash financing by the Company or any of its Subsidiaries of Common
      Stock or Common Stock Equivalents.

     

    “Subscription
      Amount”
      means,
      as
      to each Purchaser, the aggregate amount to be paid for Debentures and Warrants
      purchased hereunder as specified on the Purchasers Signature Page in the
      corresponding column next to such Purchaser’s name under the heading
“Subscription Amount”, in United States Dollars in immediately available
      funds.

     

     “Subsidiary”
means
      any corporation or limited liability company of which at least 50% of the
      outstanding securities having ordinary voting powers for the election of Board
      of Directors (or similar governing body) are at the time owned by the Company.
      As used herein, the term “Company” shall be deemed to include all of the
      Company’s Subsidiaries, if any.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    “Trading
      Market”
means,
      as applicable, the following markets or exchanges on which the Common Stock
      is
      listed or quoted for trading on the date in question: the American Stock
      Exchange, the New York Stock Exchange, the Nasdaq National Market, the Nasdaq
      SmallCap Market, the OTC Bulletin Board or the “Pink Sheets” published by the
      Pink Sheets LLC.

     

    “Transaction
      Documents”
means
      this Agreement, the Debentures, the Security Agreement, the DIA Security
      Agreement, the Warrants and any other documents or agreements executed in
      connection with the transactions contemplated hereunder.

     

    “Trident”
means
      Trident Growth Fund, L.P., a Delaware limited partnership.

     

    “Underlying
      Shares”
means
      the shares of Common Stock issuable upon exercise of the Warrants or conversion
      of the Debenture, or any other shares of Common Stock acquired by Purchasers
      hereby. 

     

    “Zone
      Mining”
means
      Zone Mining Limited, a Nevada Corporation.

     

    “Variable
      Rate Transaction”
shall
      mean a transaction in which the Company issues or sells any Common Stock
      Equivalents (A) at a conversion, exercise or exchange rate or other price that
      is based upon and/or varies with the trading prices of or quotations for the
      shares of Common Stock at any time after the initial issuance of such debt
      or
      equity securities, (B) with a conversion, exercise or exchange price that is
      subject to being reset at some future date after the initial issuance of such
      debt or equity security or upon the occurrence of specified or contingent events
      directly or indirectly related to the business of the Company or the market
      for
      the Common Stock, or (C) whereby the number of underlying shares of Common
      Stock
      to be received upon exercise, conversion, or exchange thereof, is variable
      in
      any respect in which the number of such underlying shares could be increased.
      Notwithstanding the foregoing, the presence in a Common Stock Equivalent of
      customary anti-dilution adjustments which adjust a fixed conversion or exercise
      price or the number of shares of Common Stock issuable thereunder based upon
      (a)
      the price at which Common Stock is subsequently sold or issuable by the Company,
      (b) stock splits, combinations, stock dividends, recapitalizations, and/or
      (c)
      Fundamental Transactions shall not, in and of itself, result in the transaction
      in which the Common Stock Equivalent is issued being a Variable Rate Transaction
      so long as the terms thereof are no more favorable to the recipient than to
      the
      Purchaser.

     

    “Warrants”
means
      the Common Stock Purchase Warrants, in the form of Exhibit C
      delivered to each Purchaser at the Closing in accordance with Section 2.2
      hereof, which Warrants shall be exercisable immediately and be exercisable
      until
      the close of business on the fifth anniversary following the Initial Exercise
      Date (as defined in the Warrant). The Company and Purchasers agree that the
      value of the Warrants, in the aggregate, as of the date hereof is less than
      $1,000.

     

    “ZM
      Acquisition”
      means ZM
      Acquisition Corp., a Delaware corporation.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

     

    ARTICLE
      II.

    PURCHASE
      AND SALE

     

    2.1  Closing.
      On the
      Closing Date, upon the terms and subject to the conditions set forth herein,
      concurrent with the execution and delivery of this Agreement by the parties
      hereto, the Company agrees to sell, and Purchasers agree to purchase the
      Debentures and Warrants for an aggregate amount of ONE MILLION DOLLARS
      ($1,000,000) (the “Aggregate
      Subscription Amount”).
      On
      the Closing Date, Purchasers shall deliver to the Company via wire transfer
      of
      immediately available funds the sum of $800,000 (less all expenses due
      hereunder), and the Company shall deliver to Purchasers the Debentures, the
      Warrants, and the other items set forth in Section 2.2 issuable at the Closing.
      On the date on which the balance of the Aggregate Subscription Amount is funded,
      the Company shall promptly pay to the order of each Purchaser a Closing Fee
      of
      4% and an Application Fee of 1% of the Subscription Amount actually funded
      by
      each such Purchaser, such amounts to be offset from the funding of the balance
      of the Aggregate Subscription Amount described below. Upon satisfaction of
      the
      conditions set forth in Section 2.2, the Closing shall occur at the offices
      of
      Trident, or such other location as the parties shall mutually agree. The balance
      of the Aggregate Subscription Amount in the amount of $200,000 shall be
      delivered to the Company via wire transfer of immediately available funds within
      five (5) Business Days following the date on which Purchasers have sufficient
      liquidity to advance such funds (less the above described fees).

     

    2.2  Deliveries

     

    
      	a)  	
              On
                the Closing Date, the Company shall execute and deliver or cause
                to be
                delivered to Purchasers the following, each fully executed by the
                appropriate authorized officer or officers of the Company or DIA,
                as
                applicable:

            

    

     

    
      (i) this
        Agreement (along with all Disclosure Schedules);

       

      
        (ii) the
          Debentures;

         

        
          (iii) the
            Warrants;

           

          
            (iv) the
              Security Agreement and the DIA Security Agreement along with all Security
              Documents;

             

          

        

      

    

    (v) SBA
      Form
      480 (Size Status Declaration), SBA Form 652 (Assurance of Compliance) and SBA
      Form 1031 (Portfolio Finance Report), Parts A and B, in the forms of
Exhibit
      D,
      Exhibit
      E
      and
Exhibit
      F,
      respectively, attached hereto;

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    (vi) Approval
      by the Board of Directors of the Company, done in conformance with all
      applicable law and the Bylaws of the Company, certified by the Secretary of
      the
      Company as of the Closing Date, approving or otherwise ratifying the
      transactions contemplated by this Agreement, and approving the form of this
      Agreement and the Transaction Documents, and authorizing execution, delivery,
      and performance thereof;

    

    (vii) Approval
      by the Board of Directors of the DIA, done in conformance with all applicable
      law and the Bylaws of DIA, certified by the Secretary of DIA as of the Closing
      Date, approving or otherwise ratifying the transactions contemplated by this
      Agreement, and approving the form of the DIA Security Agreement, and authorizing
      execution, delivery, and performance thereof;

    

    (viii) A
      copy of
      the Articles of Incorporation of the Company, as amended to date, certified
      by
      an official of the Company’s jurisdiction of formation or incorporation and
      further certified by the Secretary of the Company not to have been altered
      or
      amended since certification by such official; a Certificate of Good Standing
      dated within 30 days of the date first written above from the Secretary of
      State
      of the Company’s jurisdiction of formation or incorporation; and a copy of the
      Bylaws of the Company, certified as true and correct by the Secretary of the
      Company; and

    

    (ix) Such
      other instruments, documents or items as Purchasers may reasonably
      request.

     

    
       

      	b)  	
              On
                the Closing Date, each Purchaser shall deliver or cause to be delivered
                to
                the Company the following: 

            

    

     

    
      (i) this
        Agreement duly executed by each Purchaser;

       

      (ii) the
        sum
        of $800,000 (less the fees and expenses payable pursuant to Section 6.1)
        by wire
        transfer to the account as specified in writing by the Company; and

       

      (iii) the
        Security Agreement and the DIA Security Agreement, duly executed by each
        Purchaser.

       

      
        2.3  Closing
          Conditions.

         

        
          
            	a)  	
                    The
                      obligations of the Company hereunder in connection with the
                      Closing are
                      subject to the following conditions being
                      met:

                  

          

           

          
            
              
              

            

            
              8

              
                

              

            

            
              
              

            

          

        

         

        (i) the
          accuracy in all material respects when made and on the Closing Date of
          the
          representations and warranties of the Purchasers contained herein;

         

        (ii) all
          obligations, covenants and agreements of Purchasers required to be performed
          at
          or prior to the Closing Date shall have been performed; and 

         

        (iii) the
          delivery by Purchasers of the items set forth in Section 2.2(b) of this
          Agreement. 

        
           

          
            
              	b)  	
                      The
                        obligations of Purchasers hereunder in connection with the
                        Closing are
                        subject to the following conditions being
                        met:

                    

            

             

          

        

        (i) the
          accuracy in all material respects on the Closing Date of the representations
          and
          warranties of the Company contained herein;

         

        (ii) all
          obligations, covenants and agreements of the Company required to be performed
          at
          or prior to the Closing Date shall have been performed; 

         

        (iii) the
          delivery by the Company of the items set forth in Section 2.2(a) of this
          Agreement; 

         

        (iv) there
          shall have been no Material Adverse Effect with respect to the Company
          since the
          date hereof; and

         

        (v) the
          Company shall have executed a definitive merger agreement with DIA for
          the DIA
          Transaction upon terms and conditions acceptable to Purchasers in their
          sole
          discretion. 

      

       

    

     

    ARTICLE
      III.

    REPRESENTATIONS
      AND WARRANTIES

     

    
       

      3.1  Representations
        and Warranties of the Company.
        Except
        as set forth under the corresponding section of the disclosure schedules
        delivered to Purchasers concurrently herewith (the “Disclosure
        Schedules”)
        which
        Disclosure Schedules shall be deemed a part hereof, the Company hereby makes
        the
        representations and warranties set forth below to
        Purchasers:

       

    

    a) Subsidiaries.
      Except
      as set forth in Schedule 3.1(a), the Company does not have any
      Subsidiaries.
      

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    b) Organization
      and Qualification.
      The
      Company is an entity duly incorporated, validly existing and in good standing
      under the laws of the jurisdiction of its incorporation, with the requisite
      power and authority to own and use its properties and assets and to carry on
      its
      business as currently conducted. The Company is not in violation or default
      of
      any of the provisions of its certificate or articles of incorporation, bylaws,
      or other organizational or charter documents. The Company is duly qualified
      to
      conduct business and is in good standing as a foreign corporation or other
      entity in each jurisdiction in which the nature of the business conducted or
      property owned by it makes such qualification necessary, except where the
      failure to be so qualified or in good standing, as the case may be, could not
      have or reasonably be expected to result in (i) a material adverse effect on
      the
      legality, validity or enforceability of any Transaction Documents, (ii) a
      material adverse effect on the results of operations, assets, business,
      prospects or financial condition of the Company, or (iii) a material adverse
      effect on the Company’s ability to perform in any material respect on a timely
      basis its obligations under any Transaction Documents (any of (i), (ii) or
      (iii), a “Material
      Adverse Effect”)
      and no
      Proceeding has been instituted in any such jurisdiction revoking, limiting
      or
      curtailing or seeking to revoke, limit or curtail such power and authority
      or
      qualification.

     

    c) Authorization;
      Enforcement.
      The
      Company has the requisite corporate power and authority to enter into and to
      consummate the transactions contemplated by each of the Transaction Documents
      and otherwise to carry out its obligations thereunder. The execution and
      delivery of each of the Transaction Documents by the Company and the
      consummation by it of the transactions contemplated thereby have been duly
      authorized by all necessary action on the part of the Company. Each of the
      Transaction Documents has been (or upon delivery will have been) duly executed
      by the Company and, when delivered in accordance with the terms hereof, will
      constitute the valid and binding obligation of the Company enforceable against
      the Company in accordance with its terms except (i) as limited by applicable
      bankruptcy, insolvency, reorganization, moratorium and other laws of general
      application affecting enforcement of creditors’ rights generally and (ii) as
      limited by laws relating to the availability of specific performance, injunctive
      relief or other equitable remedies.

     

    d) No
      Conflicts.
      The
      execution, delivery and performance of the Transaction Documents by the Company
      and the consummation by the Company of the other transactions contemplated
      thereby do not and will not: (i) conflict with or violate any provision of
      the
      Company’s certificate or articles of incorporation, bylaws or other
      organizational or charter documents, or (ii) conflict with, or constitute a
      default (or an event that with notice or lapse of time or both would become
      a
      default) under, result in the creation of any Lien upon any of the properties
      or
      assets of the Company, or give to others any rights of termination, amendment,
      acceleration or cancellation (with or without notice, lapse of time or both)
      of,
      any agreement, credit facility, debt or other instrument (evidencing a Company
      debt or otherwise) or other understanding to which the Company is a party or
      by
      which any property or asset of the Company is bound or affected, or (iii)
      conflict with or result in a violation of any law, rule, regulation, order,
      judgment, injunction, decree or other restriction of any court or governmental
      authority to which the Company is subject (including federal and state
      securities laws and regulations), or by which any property or asset of the
      Company is bound or affected; except in the case of each of clauses (ii) and
      (iii), such as could not have or reasonably be expected to result in a Material
      Adverse Effect.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    e) Filings,
      Consents and Approvals.
      Other
      than as set forth on Schedule
      3.1(e)
      and
      except for filing of a Form D and/or state “blue sky” securities filings, the
      Company is not required to obtain any consent, waiver, authorization or order
      of, give any notice to, or make any filing or registration with, any court
      or
      other federal, state, local or other governmental authority or other Person
      in
      connection with the execution, delivery and performance by the Company of the
      Transaction Documents.

     

    f) Issuance
      of the Securities.
      The
      Securities are duly authorized and, when issued and paid for in accordance
      with
      the applicable Transaction Documents, will be duly and validly issued, fully
      paid and nonassessable, free and clear of all Liens imposed by the Company
      other
      than restrictions on transfer provided for in the Transaction Documents. The
      Underlying Shares, when issued in accordance with the terms of the Transaction
      Documents, will be validly issued, fully paid and nonassessable, free and clear
      of all Liens imposed by the Company or any third party. The Company has reserved
      from its duly authorized capital stock a number of shares of Common Stock for
      issuance of a number of Underlying Shares at least equal to the Required Minimum
      on the date hereof. The Company has not, and to the knowledge of the Company,
      no
      Affiliate of the Company has sold, offered for sale or solicited offers to
      buy
      or otherwise negotiated in respect of any security (as defined in Section 2
      of
      the Securities Act) that would be integrated with the offer or sale of the
      Securities in a manner that would require the registration under the Securities
      Act of the sale of the Securities to Purchasers.

     

    g) Capitalization.
      The
      capitalization of the Company is as described in Schedule
      3.1(g).
      The
      Company has not issued any capital stock other than as set forth on Schedule
      3.1(g).
      No
      Person has any right of first refusal, preemptive right, right of participation,
      or any similar right to participate in the transactions contemplated by the
      Transaction Documents. Except as a result of the purchase and sale of the
      Securities or as set forth on Schedule
      3.1(g),
      there
      are no outstanding options, warrants, script rights to subscribe to, calls
      or
      commitments of any character whatsoever relating to, or securities, rights
      or
      obligations convertible into or exchangeable for, or giving any Person any
      right
      to subscribe for or acquire, any shares of the Company’s capital stock, or
      contracts, commitments, understandings or arrangements by which the Company
      is
      or may become bound to issue additional shares of its capital stock, or
      securities or rights convertible or exchangeable into shares of its capital
      stock. The issuance and sale of the Securities will not obligate the Company
      to
      issue shares of Common Stock or other securities to any Person (other than
      Purchasers) and will not result in a right of any holder of Company securities
      to adjust the exercise, conversion, exchange or reset price under such
      securities. All of the outstanding shares of capital stock of the Company are
      validly issued, fully paid and nonassessable, have been issued in compliance
      with all federal and state securities laws, and none of such outstanding shares
      was issued in violation of any preemptive rights or similar rights to subscribe
      for or purchase securities. No further approval or authorization of any
      stockholder, the Board of Directors of the Company or others is required for
      the
      issuance and sale of the Securities. Except as disclosed in Schedule
      3.1(g),
      there
      are no stockholders agreements, voting agreements or other similar agreements
      with respect to the Company’s capital stock to which the Company is a party or,
      to the knowledge of the Company, between or among any of the Company’s
      stockholders. A complete list of stockholders of the Company that are officers,
      directors and individuals holding 5% or more of the outstanding Common Stock
      is
      included in Schedule
      3.1(g).
      

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    h) 
      SEC
      Documents.
      If the
      Company is subject to the reporting provisions of the Exchange Act, the Company
      has filed all required reports, schedules, forms, statements and other documents
      with the Commission. (the “SEC
      Documents”).
      As of
      their respective dates, the SEC Documents complied in all material respects
      with
      requirements of the Securities Act or the Exchange Act, as the case may be
      and
      the rules and regulations of the Commission promulgated thereunder applicable
      to
      such SEC Documents, and none of the SEC Documents contained any untrue statement
      of a material fact or omitted to state a material fact required to be stated
      therein or necessary in order to make the statements therein, in light of the
      circumstances under which they were made, not misleading, except to the extent
      that information contained in any SEC Document has been revised or superseded
      by
      a later filed SEC Document. The financial statements of the Company included
      in
      the SEC Documents comply as to form in all material respects with applicable
      accounting requirements and the published rules and regulations of the
      Commission with respect thereto, have been prepared in accordance with GAAP
      (except, in the case of unaudited statements as permitted by Form 10-Q or Form
      10-QSB) applied on a consistent basis during the periods involved (except as
      may
      be indicated in the notes thereto) and fairly present the consolidated financial
      position of the Company and its consolidated subsidiaries as of the dates
      thereof and the consolidated results of their operation and cash flows for
      the
      period then ending in accordance with GAAP (subject, in the case of the
      unaudited statements, to normal year end audit adjustments). Except as set
      forth
      in the filed SEC Documents, neither the Company nor any Subsidiaries has any
      liabilities or obligations of any nature (whether accrued, absolute, contingent
      or otherwise) required by GAAP to be set forth on a consolidated balance sheet
      of the Company and its consolidated subsidiaries or in the notes thereto and
      which could reasonably be expected to have a Material Adverse
      Effect.

     

    i) Litigation.
      Other
      than as set forth on Schedule
      3.1(i),
      there is no action, suit, inquiry, notice of violation, proceeding or
      investigation pending or, to the knowledge of the Company, threatened against
      or
      affecting the Company, or any of its respective properties before or by any
      court, arbitrator, governmental or administrative agency or regulatory authority
      (federal, state, county, local or foreign) (collectively, an “Action”)
      which
      (i) adversely affects or challenges the legality, validity or enforceability
      of
      any of the Transaction Documents or the Securities or (ii) could, if there
      were
      an unfavorable decision, have or reasonably be expected to result in a Material
      Adverse Effect. Neither the Company nor any director or officer thereof, is
      or
      has been the subject of any Action involving a claim of violation of or
      liability under federal or state securities laws or a claim of breach of
      fiduciary duty. There has not been, and to the knowledge of the Company, there
      is not pending or contemplated, any investigation by the Commission involving
      the Company or any current or former director or officer of the Company.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    j) Labor
      Relations.
      No
      material labor dispute exists or, to the knowledge of the Company, is imminent
      with respect to any of the employees of the Company which could reasonably
      be
      expected to result in a Material Adverse Effect.

     

    k) Compliance.
      The
      Company (i) is not in default under or in violation of (and no event has
      occurred that has not been waived that, with notice or lapse of time or both,
      would result in a default by the Company), nor has the Company received notice
      of a claim that it is in default under or that it is in violation of, any
      indenture, loan or credit agreement or any other agreement or instrument to
      which it is a party or by which it or any of its properties is bound (whether
      or
      not such default or violation has been waived), (ii) is not in violation of
      any
      order of any court, arbitrator or governmental body, or (iii) is not or has
      not
      been in violation of any statute, rule or regulation of any governmental
      authority, including without limitation all foreign, federal, state and local
      laws applicable to its business except in each case as could not reasonably
      be
      expected to have a Material Adverse Effect.

     

    l) Regulatory
      Permits.
      The
      Company possesses all certificates, authorizations and permits issued by the
      appropriate federal, state, local or foreign regulatory authorities necessary
      to
      conduct its business as described in Schedule
      3.1(l),
      except
      where the failure to possess such permits could not have or reasonably be
      expected to result in a Material Adverse Effect (“Material
      Permits”),
      and
      the Company has not received any notice of Proceedings relating to the
      revocation or modification of any Material Permit.

     

    m) Title
      to Assets.
      Except
      as set forth on Schedule
      3.1(m),
      the
      Company has good and marketable title in (or licenses or rights to use) all
      personal property that is material to the business of the Company, in each
      case
      free and clear of all Liens. The Company does not own any real property. Any
      real property and facilities held under lease by the Company are held by it
      under valid, subsisting and enforceable leases of which the Company is in
      compliance. The Company has not granted, and no third party has obtained in
      any
      manner, other than as contemplated by the Transaction Documents, any security
      interest in the assets of the Company. Schedule 3.1(m) sets forth and details
      which, if any, of such assets are owned by any Subsidiary.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    n) Intellectual
      Property.
      

     

    (i) Schedule
      3.1(n)
      contains
      a list of the Company’s Intellectual Property.  For purposes hereof,
“Intellectual
      Property”
means
      any or all of the following and all rights and goodwill, arising out of or
      associated therewith:  (A) all United States, international, and foreign
      patents and applications therefor (including provisional applications) and
      all
      reissues, reexaminations, divisions, renewals, extensions, provisionals,
      continuations and continuations-in-part thereof; (B) all inventions (whether
      patentable or not), invention disclosures, improvements, trade secrets,
      proprietary information, know-how, technology, technical data and customer
      lists, and all documentation relating to any of the foregoing throughout the
      world; (C) all international, U.S. and foreign registered trademarks, trade
      names, service marks, logos, slogans, and designs, applications to register
      trademarks, trade names, service marks, logos, slogans, and designs,
      intent-to-use applications, or other registrations or applications related
      to
      trademarks, service marks, common law trademarks, trade names, service marks,
      logos, slogans, and designs and all associated goodwill associated with all
      of
      the foregoing; (D) all copyrights, copyright registrations and applications
      therefor, and all other rights corresponding thereto throughout the world;
      (E)
      all industrial designs and any registrations and applications therefor
      throughout the world; (F) all URL’s, domain names, trade names, logos, slogans,
      designs, common law trademarks and service marks, trademark and service mark
      registrations and applications therefor throughout the world; (G) all databases
      and data collections and all rights therein throughout the world; (H) all moral
      and economic rights of authors and inventors, however denominated, throughout
      the world; (I) any other intellectual property that is the subject of an
      application, certificate, filing, registration or other document issued, filed
      with, or recorded with any federal, state, local or foreign government or other
      public body; and (J) any similar or equivalent rights to any of the foregoing
      anywhere in the world. For purposes hereof, “Company
      Intellectual Property”
means
      any Company Intellectual Property owned or licensed by the Company, and
“Company
      Registered Intellectual Property”
means
      any items of Intellectual Property described in subsections (A), (C) or (D)
      of
      this paragraph.

     

    (ii) No
      Company Intellectual Property or product or service of the Company’s business
      related to the Company Intellectual Property is subject to any Proceeding or
      outstanding decree, order, judgment, agreement or stipulation restricting in
      any
      manner the use, transfer or licensing thereof by the Company, or which may
      affect the validity, use or enforceability of such Company Intellectual
      Property. Each item of Company Registered Intellectual Property is valid and
      subsisting. All necessary registration, maintenance and renewal fees currently
      due in connection with the Company Registered Intellectual Property have been
      made and all necessary documents, recordations and certifications in connection
      with such Company Registered Intellectual Property have been filed with the
      relevant patent, copyright, trademark or other authorities in the United States
      or foreign jurisdictions, as the case may be, for the purpose of maintaining
      such Company Registered Intellectual Property.

     

    (iii) The
      Company owns and has good and exclusive title to, or has licenses (any
      Intellectual Property subject to any license to be identified as such in
Schedule
      3.1(n))
      (sufficient for the conduct of the Company’s business as currently conducted) to
      use each item of the Company’s Intellectual Property free and clear of any Lien;
      and the Company is the exclusive owner or exclusive licensee of all trademarks
      and service marks, trade names and domain names used in connection with and
      material to the operation or conduct of the Company’s business, including the
      sale of any products or the provision of any services by same, free and clear
      of
      all Liens. The Company Intellectual Property, other than future improvements,
      derivations, and additions to be made by the Company or on behalf of the
      Company, constitutes all of the Intellectual Property used or contemplated
      for
      use in connection with the Company’s current business and in the performance of
      any contract, proposal or letter of intent in connection with same.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    (iv) To
      the
      extent that any Company Intellectual Property has been developed or created
      by a
      third party for the Company, the Company has a written agreement with such
      third
      party with respect thereto and the Company thereby either (A) has obtained
      ownership of and is the exclusive owner of, or (B) has obtained a license
      (sufficient for the conduct of the Company’s business as currently conducted) to
      all of such third party’s Intellectual Property in such work, material or
      invention by operation of law or by valid assignment, to the fullest extent
      it
      is legally possible to do so, each such agreement being listed on Schedule
      3.1(n).

     

    (v) The
      operation of the Company’s business as it is currently conducted, including the
      Company’s design, development, marketing and sale of the products or services of
      the Company (including with respect to products currently under development)
      has
      not, does not and will not infringe or misappropriate in any manner the
      Intellectual Property of any third party or, to the knowledge of the Company,
      constitute unfair competition or trade practices under the laws of any
      jurisdiction.

     

    (vi) The
      Company has no knowledge, and has not received written notice or any other
      overt
      threats from any third party, that the operation of the Company’s business as it
      is currently conducted, or any act, product or service of the Company’s
      business, infringes or misappropriates the Intellectual Property of any third
      party or constitutes unfair competition or trade practices under the laws of
      any
      jurisdiction. The Company’s Intellectual Property is not the subject of any
      third party communications relating to validity or enforceability, cease and
      desist orders, demand letters, warnings or prior settlement agreements. 
The Company’s Intellectual Property is not currently the subject of any pending
      or threatened re-examinations, oppositions, interferences, or infringement
      actions.

     

    (vii) To
      the
      knowledge of the Company, no Person has or is infringing or misappropriating
      any
      Company Intellectual Property.

     

    (viii) The
      Company has taken reasonable steps to protect the rights of the Company in
      the
      confidential information and trade secrets of the Company used in the Company’s
      business or any trade secrets or confidential information of third parties
      used
      in same, and, without limiting the foregoing, the Company has enforced a policy
      requiring each employee and contractor to execute a proprietary
      information/confidentiality agreement, and except under confidentiality
      obligations or in the context of the attorney-client relationship, there has
      not
      been any disclosure by the Company of any such trade secrets or confidential
      information.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    o) Insurance.
      The
      Company is insured by insurers of recognized financial responsibility against
      such losses and risks and in such amounts as are prudent and customary in the
      businesses in which the Company is engaged, including directors and officers
      insurance at least equal to the aggregate principal amount of the Debenture.
      To
      the best of Company’s knowledge, such insurance contracts and policies are
      accurate and complete. The Company has no reason to believe that it will not
      be
      able to renew its existing insurance coverage as and when such coverage expires
      or to obtain similar coverage from similar insurers as may be necessary to
      continue its business without a significant increase in cost.

     

    p) Transactions
      With Affiliates and Employees.
      None of
      the officers or directors of the Company and, to the knowledge of the Company,
      none of the employees of the Company is presently a party to any transaction
      with the Company (other than for services as employees, officers and directors),
      including any contract, agreement or other arrangement providing for the
      furnishing of services to or by, providing for rental of real or personal
      property to or from, or otherwise requiring payments to or from any officer,
      director or such employee or, to the knowledge of the Company, any entity in
      which any officer, director, or any such employee has a substantial interest
      or
      is an officer, director, trustee or partner, in each case in excess of $60,000
      other than (i) for payment of salary or consulting fees for services rendered,
      (ii) reimbursement for expenses incurred on behalf of the Company and (iii)
      for
      other employee benefits, including stock option agreements under any stock
      option plan of the Company.

     

    q) Internal
      Accounting Controls.
      The
      Company maintains a system of internal accounting controls sufficient to provide
      reasonable assurance that (i) transactions are executed in accordance with
      management’s general or specific authorizations, (ii) transactions are recorded
      as necessary to permit preparation of financial statements in conformity with
      GAAP and to maintain asset accountability, (iii) access to assets is permitted
      only in accordance with management’s general or specific authorization, and (iv)
      the recorded accountability for assets is compared with the existing assets
      at
      reasonable intervals and appropriate action is taken with respect to any
      differences. 

     

    r) Certain
      Fees.
      Other
      than as set forth on Schedule
      3.1(r),
      no
      brokerage or finder’s fees or commissions are or will be payable by the Company
      to any broker, financial advisor or consultant, finder, placement agent,
      investment banker, bank or other Person with respect to the transactions
      contemplated by this Agreement. Purchasers shall have no obligation with respect
      to any fees or with respect to any claims made by or on behalf of other Persons
      for fees of a type contemplated in this Section that may be due in connection
      with the transactions contemplated by this Agreement.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    s) Private
      Placement.
      Assuming the accuracy of Purchasers’ representations and warranties set forth in
      Section 3.2, no registration under the Securities Act is required for the offer
      and sale of the Securities by the Company to Purchasers as contemplated hereby.
      

     

    t) Investment
      Company.
      The
      Company is not, and is not an Affiliate of, and immediately after receipt of
      payment for the Securities, will not be or be an Affiliate of, an “investment
      company” within the meaning of the Investment Company Act of 1940, as amended.
      The Company shall conduct its business in a manner so that it will not become
      subject to the Investment Company Act.

     

    u) Registration
      Rights.
      Other
      than as set forth on Schedule
      3.1(u),
      no
      Person has any right to cause the Company to effect the registration under
      the
      Securities Act of any securities of the Company.

     

    v) Application
      of Takeover Protections.
      The
      Company and its Board of Directors have taken all necessary action, if any,
      in
      order to render inapplicable any control share acquisition, business
      combination, poison pill (including any distribution under a rights agreement)
      or other similar anti-takeover provision under the Company’s Certificate of
      Incorporation (or similar charter documents) or the laws of its state of
      incorporation that is or could become applicable to Purchasers as a result
      of
      Purchasers and the Company fulfilling their obligations or exercising their
      rights under the Transaction Documents, including without limitation as a result
      of the Company’s issuance of the Securities and the Purchasers’ ownership of the
      Securities.

     

    w) Disclosure.
      Except
      for information provided to the Purchasers by the Company with respect to the
      DIA Transaction or the Qualifying Transaction, the Company confirms that neither
      it nor any other Person acting on its behalf has provided Purchasers or their
      agents or counsel with any information that constitutes or might constitute
      material, nonpublic information except for such information that will be
      publicly disclosed in documents filed with the Commission. The Company
      understands and confirms that Purchasers will rely on the foregoing
      representations and covenants in effecting transactions in securities of the
      Company. All written statements provided to Purchasers regarding the Company,
      its business and the transactions contemplated hereby, including the Disclosure
      Schedules to this Agreement, furnished by or on behalf of the Company with
      respect to the representations and warranties made herein are true and correct
      with respect to such representations and warranties and do not contain any
      untrue statement of a material fact or omit to state any material fact necessary
      in order to make the statements made therein, in light of the circumstances
      under which they were made, not misleading. 

     

    
      
        
        

      

      
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    x) No
      Integrated Offering.
      Assuming
      the accuracy of Purchasers’ representations and warranties set forth in Section
      3.2, neither the Company, nor any of its Affiliates, nor any Person acting
      on
      its or their behalf has, directly or indirectly, made any offers or sales of
      any
      security or solicited any offers to buy any security, under circumstances that
      would cause this offering of the Securities to be integrated with prior
      offerings by the Company for purposes of the Securities Act or any applicable
      shareholder approval provisions.

     

    y) Solvency.
      Based
      on the financial condition of the Company as of the Closing Date after giving
      effect to the receipt by the Company of the proceeds from the sale of the
      Securities hereunder, (i) the Company’s fair saleable value of its assets
      exceeds the amount that will be required to be paid on or in respect of the
      Company’s existing debts and other liabilities (including known contingent
      liabilities) as they mature; (ii) the Company’s assets do not constitute
      unreasonably small capital to carry on its business for the current fiscal
      year
      as now conducted and as proposed to be conducted including its capital needs
      taking into account the particular capital requirements of the business
      conducted by the Company, and projected capital requirements and capital
      availability thereof; and (iii) the current cash flow of the Company, together
      with the proceeds the Company would receive, were it to liquidate all of its
      assets, after taking into account all anticipated uses of the cash, would be
      sufficient to pay all amounts on or in respect of its debt when such amounts
      are
      required to be paid. The Company does not intend to incur debts beyond its
      ability to pay such debts as they mature (taking into account the timing and
      amounts of cash to be payable on or in respect of its debt).

     

    z) Tax
      Status.
       
      Except
      for matters that would not, individually or in the aggregate, have or reasonably
      be expected to result in a Material Adverse Effect, the Company has filed all
      necessary federal, state and foreign income and franchise tax returns and has
      paid or accrued all taxes shown as due thereon, and the Company has no knowledge
      of a tax deficiency which has been asserted or threatened against the
      Company.

     

    aa) No
      General Solicitation.
      Neither
      the Company nor any person acting on behalf of the Company has offered or sold
      any of the Securities by any form of general solicitation or general
      advertising. The Company has offered the Securities for sale only to Purchasers
      and certain other “accredited investors” within the meaning of Rule 501 under
      the Securities Act.

     

    bb) Foreign
      Corrupt Practices.
      Neither
      the Company, nor to the knowledge of the Company, any agent or other person
      acting on behalf of the Company, has (i) directly or indirectly, used any
      corporate funds for unlawful contributions, gifts, entertainment or other
      unlawful expenses related to foreign or domestic political activity, (ii) made
      any unlawful payment to foreign or domestic government officials or employees
      or
      to any foreign or domestic political parties or campaigns from corporate funds,
      (iii) failed to disclose fully any contribution made by the Company (or made
      by
      any person acting on its behalf of which the Company is aware) which is in
      violation of law, or (iv) violated in any material respect any provision of
      the
      Foreign Corrupt Practices Act of 1977, as amended

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    cc) Indebtedness.
      Other
      than as set forth on Schedule
      3.1(cc),
      as of
      the Closing Date, the Company has no indebtedness.

     

    dd) No
      Disagreements with Accountants and Lawyers.
      There
      are no disagreements of any kind presently existing, or reasonably anticipated
      by the Company to arise, between the accountants and lawyers formerly or
      presently employed by the Company and the Company is current with respect to
      any
      fees owed to its accountants and lawyers.

     

    ee) Acknowledgment
      Regarding Purchasers’ Purchase of Securities.
      The
      Company acknowledges and agrees that Purchasers are acting solely in the
      capacity of arm’s length purchasers with respect to the Transaction Documents
      and the transactions contemplated hereby as they relate to the Company. The
      Company further acknowledges that Purchasers are not acting as a financial
      advisor or fiduciary of the Company (or in any similar capacity) with respect
      to
      this Agreement and the transactions contemplated hereby and any advice given
      by
      Purchasers or any of their respective representatives or agents to the Company
      in connection with this Agreement and the transactions contemplated hereby
      is
      merely incidental to the Purchasers’ purchase of the Securities. 

     

    ff) Material
      Liabilities.
      The
      sole outstanding material liabilities of the Company are set forth on
Schedule
      3.1(ff) .

    

    gg) Material
      Agreements.
      Except
      for those agreements set forth on Schedule
      3.1(gg)
      hereof,
      there are no other material agreements to which the Company is a
      party.

    

    hh) Board
      of Directors.
      The
      Board of Directors of the Company consists of those persons set forth on
Schedule
      3.1(hh).

     

    ii) Financial
      Statements.
      Other
      than as set forth on Schedule
      3.1(ii),
      there
      are no audited financial statements of the Company.

    
       

      3.2  Representations
        and Warranties of Purchasers.
        Each
        Purchaser hereby, for itself and for no other Purchaser, represents and warrants
        as of the date hereof and as of the Closing Date to the Company as
        follows:

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    (a)  Organization;
      Authority.
      Such
      Purchaser (if not an individual) is an entity duly organized, validly existing
      and in good standing under the laws of the jurisdiction of its organization
      with
      full right, corporate or partnership power and authority to enter into and
      to
      consummate the transactions contemplated by the Transaction Documents and
      otherwise to carry out its obligations thereunder. The execution, delivery
      and
      performance by Purchaser of the transactions contemplated by this Agreement
      have
      been duly authorized by all necessary corporate or similar action on the part
      of
      Purchaser. Each of the Transaction Documents to which it is a party has been
      duly executed by Purchaser, and when delivered by Purchaser in accordance with
      the terms hereof, will constitute the valid and legally binding obligation
      of
      Purchaser, enforceable against it in accordance with its terms, except (i)
      as
      limited by general equitable principles and applicable bankruptcy, insolvency,
      reorganization, moratorium and other laws of general application affecting
      enforcement of creditors’ rights generally, (ii) as limited by laws relating to
      the availability of specific performance, injunctive relief or other equitable
      remedies and (iii) insofar as indemnification and contribution provisions may
      be
      limited by applicable law.

     

    (b)  Purchaser
      Representation.
      Purchaser understands that the Securities are “restricted securities” and have
      not been registered or qualified, as the case may be, under the Securities
      Act
      or any applicable state securities law by reason of a specific exemption from
      the registration or qualification provisions of the Securities Act or any
      applicable state securities laws, the availability of which depends upon, among
      other things, the bona fide nature of the investment intent and the accuracy
      of
      Purchaser’s representations as expressed herein. Purchaser represents that it is
      acquiring the Securities for investment as principal for its own account and
      not
      with a view to or for distribution or resale of such Securities or any part
      thereof, has no present intention of distributing any of such Securities and
      has
      no arrangement or understanding with any other persons regarding the
      distribution of such Securities (this representation and warranty not limiting
      Purchaser’s right to sell the Securities pursuant to a Registration Statement or
      otherwise in compliance with applicable federal and state securities laws).
      Purchaser is acquiring the Securities hereunder in the ordinary course of its
      business. Purchaser does not have any agreement or understanding, directly
      or
      indirectly, with any Person to distribute any of the Securities.

     

    (c)  Purchaser
      Status.
      At the
      time Purchaser was offered the Securities, it was, and at the date hereof it
      is,
      and on each date on which it exercises any Warrants it will be either: (i)
      an
“accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or
      (a)(8)) of Regulation D promulgated under the Securities Act or (ii) a
“qualified institutional buyer” as defined in Rule 144A(a) under the Securities
      Act. 

     

    (d)  Experience
      of Purchasers.
      Purchaser, either alone or together with its representatives, has such
      knowledge, sophistication and experience in business and financial matters
      so as
      to be capable of evaluating the merits and risks of the prospective investment
      in the Securities, and has so evaluated the merits and risks of such investment.
      Purchaser understands that the acquisition of the Securities hereunder is highly
      a speculative investment which involves a high degree of loss of Purchaser’s
      investment therein. Purchaser is able to bear the economic risk of an investment
      in the Securities and, at the present time, is able to afford a complete loss
      of
      such investment.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    (e)  Certain
      Fees.
      Purchaser has not entered into an agreement whereby brokerage or finder’s fees
      or commissions are or will be payable by the Company to any broker, financial
      advisor or consultant, finder, placement agent, investment banker, bank or
      other
      Person with respect to the transactions contemplated by this Agreement.

     

    The
      Company acknowledges and agrees that no Purchaser has made any representations
      or warranties with respect to the transactions contemplated hereby other than
      those specifically set forth in this Section 3.2. 

     

    ARTICLE
      IV.

    OTHER
      AGREEMENTS OF THE PARTIES

     

    4.1  Transfer
      Restrictions.

     

    (a)  The
      Securities may only be disposed of in compliance with state and federal
      securities laws. In connection with any transfer of Securities other than
      pursuant to an effective registration statement, the Company may require the
      transferor thereof to provide to the Company an opinion of counsel selected
      by
      the transferor and reasonably acceptable to the Company, the form and substance
      of which opinion shall be reasonably satisfactory to the Company, to the effect
      that such transfer does not require registration of such transferred Securities
      under the Securities Act or any applicable state securities laws. As a condition
      of transfer, any such transferee shall agree in writing to be bound by the
      terms
      of this Agreement and shall have the rights of a Purchaser under this
      Agreement.

     

    (b)  Purchasers
      agree to the imprinting, so long as is required by this Section 4.1(b), of
      a
      legend on any of the Securities in substantially the following
      form:

     

    NEITHER
      THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
      HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE
      SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
      REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
      ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
      EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
      AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
      SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR
      TO
      SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
      COMPANY. 

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    The
      Company acknowledges and agrees that Purchasers may from time to time pledge
      pursuant to a bona fide margin agreement with a registered broker-dealer or
      grant a security interest in some or all of the Securities to a financial
      institution that is an “accredited investor” as defined in Rule 501(a) under the
      Securities Act and who agrees to be bound by the provisions of this Agreement
      and, if required under the terms of such arrangement, Purchasers may transfer
      pledged or secured Securities to the pledgees or secured parties. Such a pledge
      or transfer would not be subject to approval of the Company and, so long as
      the
      legend set forth in Section 4.1(b) hereof remains on the certificates evidencing
      the Securities (unless the conditions of Section 4.1(c) have been satisfied),
      no
      legal opinion of legal counsel of the pledgee, secured party or pledgor shall
      be
      required in connection therewith. Further, no notice shall be required of such
      pledge. At the Purchaser’s expense, the Company will execute and deliver such
      reasonable documentation as a pledgee or secured party of Securities may
      reasonably request in connection with a pledge or transfer of the
      Securities.

     

    (c)  Certificates
      evidencing Underlying Shares shall not contain any legend (including the legend
      set forth in Section 4.1(b) hereof): (i) while a Registration Statement covering
      the resale of such Underlying Shares is effective under the Securities Act,
      (ii)
      following any sale of such Underlying Shares pursuant to Rule 144, (iii) if
      such
      Underlying Shares are eligible for sale under Rule 144(k), or (iv) if such
      legend is not required under applicable requirements of the Securities Act
      (including judicial interpretations and pronouncements issued by the staff
      of
      the Commission); provided,
      however,
      in
      connection with the issuance of the Underlying Shares, Purchasers hereby agrees
      to adhere to and abide by all prospectus delivery requirements under the
      Securities Act and rules and regulations of the Commission and all applicable
      state “blue sky” securities laws and in the event that the registration
      statement covering the resale of the Underlying Shares is no longer effective
      under the Securities Act and the Underlying Shares are not eligible for sale
      under Rule 144(k), to return such certificates to the Company so that the legend
      set forth in Section 4.1(b) may be affixed to the certificates evidencing such
      shares. The Company shall cause its counsel to issue a legal opinion to the
      Company’s transfer agent if so required by the Company’s transfer agent to
      effect the removal of the legend hereunder. If all or any portion of a Warrant
      is exercised at a time when there is an effective Registration Statement to
      cover the resale of the Underlying Shares, or if such shares may be sold under
      Rule 144(k) or if such legend is not otherwise required under applicable
      requirements of the Securities Act (including judicial interpretations thereof)
      then such shares shall be issued free of all legends. The Company agrees that
      at
      such time as such legend is no longer required under this Section 4.1(c), it
      will, no later than five Business Days following the delivery by Purchasers
      to
      the Company or the Company’s transfer agent of a certificate representing
      Underlying Shares, as applicable, issued with a restrictive legend (such five
      Business Day, the “Legend
      Removal Date”),
      deliver or cause to be delivered to Purchasers a certificate (or certificates,
      as the case may be) representing such shares that is free from all restrictive
      and other legends. The Company may not make any notation on its records or
      give
      instructions to any transfer agent of the Company that enlarge the restrictions
      on transfer set forth in this Section.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    (d)  In
      addition to Purchasers’ other available remedies, the Company shall pay to
      Purchasers, in cash, as partial liquidated damages and not as a penalty, the
      greater of (i) $500 for each Business Day after the Legend Removal Date, the
      Warrant Share Delivery Date (as defined in Section 2(e)(ii) of the Warrant),
      or
      other such date the Underlying Shares are to be delivered to the Purchasers,
      as
      the case may be, until such certificate is delivered with an appropriate legend
      or without a restrictive legend, as the case may be; and (ii) the difference
      in
      the Market Value of the Underlying Shares (based on the closing bid price of
      the
      Common Stock on the then principal Trading Market on the date such Securities
      are submitted to the Company’s transfer agent) on the delivery date and the date
      such shares are actually received by the Holder in such form as required herein
      and in the Transaction Documents. Nothing herein shall limit a Purchaser’s right
      to pursue equitable remedies for the Company’s failure to deliver certificates
      representing any Securities as required by the Transaction Documents, including,
      without limitation, a decree of specific performance and/or injunctive
      relief.

     

    (e)  Purchasers
      agree that the removal of the restrictive legend from certificates representing
      Securities as set forth in this Section 4.1 is predicated upon the Company’s
      reliance that Purchasers will sell any Securities pursuant to either the
      registration requirements of the Securities Act, including any applicable
      prospectus delivery requirements, or an exemption therefrom.

     

    4.2  Acknowledgment
      of Dilution.
      The
      Company acknowledges that the issuance of the Underlying Shares may result
      in
      dilution of the outstanding shares of Common Stock, which dilution may be
      substantial under certain market conditions. The Company further acknowledges
      that its obligations under the Transaction Documents, including without
      limitation its obligation to issue the Underlying Shares pursuant to the
      Transaction Documents, are unconditional and absolute and not subject to any
      right of set off, counterclaim, delay or reduction, regardless of the effect
      of
      any such dilution or any claim the Company may have against Purchasers and
      regardless of the dilutive effect that such issuance may have on the ownership
      of the other stockholders of the Company.

     

    4.3  Furnishing
      of Information.
      At any
      time after the date hereof, if the Company is or becomes subject to the rules,
      regulations, and/or reporting requirements of the Exchange Act and as long
      as
      any Purchaser owns restricted Securities, the Company covenants to timely file
      (or obtain extensions in respect thereof and file within the applicable grace
      period) all reports required to be filed by the Company after the date hereof
      pursuant to the Exchange Act. As long as any Purchaser owns Securities, if
      the
      Company is not required to file reports pursuant to the Exchange Act, it will
      prepare and furnish to each such Purchaser and make publicly available in
      accordance with Rule 144(c) such information as is required for Purchaser to
      sell the Underlying Shares under Rule 144. The Company further covenants that
      it
      will take such further action as any holder of Securities may reasonably
      request, all to the extent required from time to time to enable such Person
      to
      sell such Underlying Shares without registration under the Securities Act within
      the limitation of the exemptions provided by Rule 144.

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    4.4  Integration.
      The
      Company shall not sell, offer for sale or solicit offers to buy or otherwise
      negotiate in respect of any security (as defined in Section 2 of the Securities
      Act) that would be integrated with the offer or sale of the Securities in a
      manner that would require the registration under the Securities Act of the
      sale
      of the Securities to Purchasers or, if then listed or quoted on a Trading
      Market, that would be integrated with the offer or sale of the Securities for
      purposes of the rules and regulations of any Trading Market.

     

    4.5  Exercise
      Procedures.
      The
      form of Notice of Exercise and Conversion Notice included in the Warrant and
      Debenture, respectively, set forth the totality of the procedures required
      of
      Purchasers in order to exercise the respective Warrants or convert the
      Debentures. No additional legal opinion or other information or instructions
      shall be required of any Purchaser to exercise its Warrant or convert their
      Debenture. The Company shall honor exercises of the Warrant and conversions
      of
      the Debenture and shall deliver Underlying Shares in accordance with the terms,
      conditions and time periods set forth in such Transaction
      Documents.

     

    4.6  Shareholders
      Rights Plan.
      No
      claim will be made or enforced by the Company or, to the knowledge of the
      Company, any other Person that any Purchaser is an “Acquiring Person” under any
      shareholders rights plan or similar plan or arrangement in effect or hereafter
      adopted by the Company, or that Purchaser could be deemed to trigger the
      provisions of any such plan or arrangement, by virtue of receiving Securities
      under the Transaction Documents or under any other agreement between the Company
      and any Purchaser.

     

    4.7  Non-Public
      Information.
      The
      Company covenants and agrees that neither it nor any other Person acting on
      its
      behalf will provide any Purchaser or its agents or counsel with any information
      that the Company believes constitutes material non-public information, unless
      prior thereto such Purchaser shall have executed a written agreement regarding
      the confidentiality and use of such information. The Company understands and
      confirms that such Purchaser shall be relying on the foregoing representations
      in effecting transactions in securities of the Company.

     

    4.8  Use
      of
      Proceeds.
      Except
      as set forth in Schedule
      4.8,
      the
      Company shall use the net proceeds from the sale of the Securities hereunder
      for
      working capital purposes and not for the satisfaction of any portion of the
      Company’s debt (other than payment of trade payables in the ordinary course of
      the Company’s business and prior practices), to redeem any Common Stock or
      Common Stock Equivalents or to settle any outstanding litigation. Schedule
      4.8
      shall
      detail the Company’s expected use of proceeds received from the sale of the
      Securities hereunder.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    4.9  Reimbursement.
      If any
      Purchaser becomes involved in any capacity in any Proceeding by or against
      any
      Person who is a stockholder of the Company (except as a result of sales,
      pledges, margin sales or any similar transaction(s) by such Purchaser to or
      with
      any current stockholder), solely as a result of such Purchaser’s acquisition of
      the Securities under this Agreement, and such Purchaser is successful in the
      Proceeding the Company will reimburse Purchaser for its reasonable legal and
      other expenses (including the cost of any investigation preparation and travel
      in connection therewith) incurred in connection therewith, as such expenses
      are
      incurred. The reimbursement obligations of the Company under this paragraph
      shall be in addition to any liability which the Company may otherwise have,
      shall extend upon the same terms and conditions to any Affiliates of such
      Purchaser who are actually named in such Action, Proceeding or investigation,
      and partners, directors, agents, employees and controlling persons (if any),
      as
      the case may be, of Purchaser and any such Affiliate, and shall be binding
      upon
      and inure to the benefit of any successors, assigns, heirs and personal
      representatives of the Company, Purchaser and any such Affiliate and any such
      Person. The Company also agrees that neither any Purchaser nor any such
      Affiliates, partners, directors, agents, employees or controlling persons shall
      have any liability to the Company or any Person asserting claims on behalf
      of or
      in right of the Company solely as a result of acquiring the Securities under
      this Agreement.

     

    4.10  Indemnification
      of Purchasers.
      Subject
      to the provisions of this Section 4.10, the Company will indemnify and hold
      the
      Purchasers and their respective directors, officers, managers, shareholders,
      partners, employees and agents (each, a “Purchaser
      Party”)
      harmless from any and all losses, liabilities, obligations, claims,
      contingencies, damages, costs and expenses, including all judgments, amounts
      paid in settlements, court costs and reasonable attorneys’ fees and costs of
      investigation that any such Purchaser Party may suffer or incur as a result
      of
      or relating to (a) any breach of any of the representations, warranties,
      covenants or agreements made by the Company in this Agreement or in the other
      Transaction Documents or (b) any action instituted against any Purchaser, or
      any
      of its Affiliates, by any stockholder of the Company who is not an Affiliate
      of
      Purchaser, with respect to any of the transactions contemplated by the
      Transaction Documents (unless such action is based upon a breach of Purchaser’s
      representation, warranties or covenants under the Transaction Documents or
      any
      agreements or understandings a Purchaser may have with any such stockholder
      or
      any violations by a Purchaser of state or federal securities laws or any conduct
      by such Purchaser which constitutes fraud, gross negligence, willful misconduct
      or malfeasance). If any action shall be brought against any Purchaser Party
      in
      respect of which indemnity may be sought pursuant to this Agreement, such
      Purchaser Party shall promptly notify the Company in writing, and the Company
      shall have the right to assume the defense thereof with counsel of its own
      choosing. Any Purchaser Party shall have the right to employ separate counsel
      in
      any such action and participate in the defense thereof, but the fees and
      expenses of such counsel shall be at the expense of such Purchaser Party except
      to the extent that (i) the employment thereof has been specifically authorized
      by the Company in writing, (ii) the Company has failed after a reasonable period
      of time to assume such defense and to employ counsel or (iii) in such action
      there is, in the reasonable opinion of such separate counsel, a material
      conflict on any material issue between the position of the Company and the
      position of such Purchaser Party. The Company will not be liable to any
      Purchaser Party under this Agreement (i) for any settlement by a Purchaser
      Party
      effected without the Company’s prior written consent, which shall not be
      unreasonably withheld or delayed; or (ii) to the extent, but only to the extent
      that a loss, claim, damage or liability is attributable to any Purchaser Party’s
      breach of any of the representations, warranties, covenants or agreements made
      by such Purchaser in this Agreement or in the other Transaction Documents or
      any
      agreements or understandings a Purchaser may have with any stockholder of the
      Company who is not an Affiliate of Purchaser or any knowing or intentional
      violations by a Purchaser of state or federal securities laws or any conduct
      by
      such Purchaser which constitutes fraud, gross negligence, willful misconduct
      or
      malfeasance.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    4.11  Reservation
      and Listing of Securities.

     

    (a)  The
      Company shall maintain a reserve from its duly authorized shares of Common
      Stock
      for issuance pursuant to the Transaction Documents in such amount as may be
      required to fulfill its obligations in full under the Transaction
      Documents.

     

    (b)  If,
      on
      any date, the number of authorized but unissued (and otherwise unreserved)
      shares of Common Stock is less than the Required Minimum on such date, then
      the
      Board of Directors of the Company shall use commercially reasonable efforts
      to
      amend the Company’s certificate or articles of incorporation to increase the
      number of authorized but unissued shares of Common Stock to at least the
      Required Minimum at such time, as soon as possible and in any event not later
      than the 75th day after such date; and

     

    
      (c)  The
        Company shall, if then applicable: (i) in the time and manner required by
        the
        Trading Market or if the Common Stock is listed on another Trading Market,
        promptly prepare and file with such Trading Market an additional shares listing
        application covering a number of shares of Common Stock at least equal to
        the
        Required Minimum on the date of such application, (ii) take all steps necessary
        to cause such shares of Common Stock to be approved for listing on the Trading
        Market as soon as possible thereafter, (iii) provide to Purchasers evidence
        of
        such listing, and (iv) maintain the listing of such Common Stock on any date
        at
        least equal to the Required Minimum on such date on such Trading
        Market.

       

      
        
          4.12  Future
            Priced Securities.
            From
            the date hereof until the date that less than 20% in principal amount
            of the
            Debentures initially issued are outstanding, the Company shall be prohibited
            from effecting or entering into an agreement to affect any Subsequent
            Financing
            involving a Variable Rate Transaction.

           

          
            
              
                4.13  Equal
                  Treatment of Purchasers.
                  No
                  consideration shall be offered or paid to any person to amend or
                  consent to a
                  waiver or modification of any provision of any of the Transaction
                  Documents
                  unless the same consideration is also offered to all of the parties
                  to the
                  Transaction Documents. Further, the Company shall not make any
                  payment of
                  principal or interest on the Debentures in amounts which are disproportionate
                  to
                  the respective principal amounts outstanding on the Debentures
                  at any applicable
                  time. For clarification purposes, this provision constitutes a
                  separate right
                  granted to each Purchaser by the Company and negotiated separately
                  by each
                  Purchaser, and is intended to treat for the Company the Debenture
                  holders as a
                  class and shall not in any way be construed as the Purchasers acting
                  in concert
                  or as a group with respect to the purchase, disposition or voting
                  of Securities
                  or otherwise.

                 

              

            

          

        

      

    

    
      
        
        

      

      
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          4.14  Registration
            Rights.

           

        

      

    

    (a) Piggyback
      Registrations.
      

    

    A.
      At any
      time after the Closing Date, if the Company proposes to register any Common
      Stock for sale solely for cash, either for its own account or for the account
      of
      a stockholder or stockholders (a “Company
      Registration”),
      then
      the Company shall give Purchasers written notice of its intention to do so
      and
      of the intended method of sale (the “Registration
      Notice”)
      not
      fewer than 30 days prior to the anticipated filing date of the Registration
      Statement effecting such Company Registration. Purchasers may request inclusion
      of any Registrable Securities in such Company Registration by delivering to
      the
      Company, within 20 days after receipt of the Registration Notice, a written
      notice (the “Piggyback
      Notice”)
      stating the number of shares of Registrable Securities proposed to be included
      and that such shares are to be included in any underwriting only on the same
      terms and conditions as the shares of Common Stock otherwise being sold through
      underwriters under such Company Registration. The Company shall use its best
      efforts to cause all Registrable Securities specified in the Piggyback Notice
      to
      be included in the Company Registration and any related offering, all to the
      extent requisite to permit the sale by Purchasers of such Registrable Securities
      in accordance with the method of sale applicable to the other shares of Common
      Stock included in the Company Registration. If the Company fails to file the
      Registrable Securities in such Registration Statement, then, at the option
      of
      Purchasers, for each full day that the Registrable Securities are not fully
      registered, Company shall Purchasers, as partial liquidated damages and not
      as a
      penalty, the sum of $1,000 per day until the shares are registered (not to
      exceed $150,000 under any circumstances). 

    

    B. The
      Company’s obligation to include Registrable Securities in a Company Registration
      pursuant to this Section 4.16(a) shall be subject to the following
      limitations:

    

    (i) The
      Company shall not be obligated to include any Registrable Securities in a
      registration statement (I) filed on Form S-4 or Form S-8 or such other similar
      successor forms then in effect under the Securities Act, (II) pursuant to which
      the Company is offering to exchange its own securities, or (III) relating to
      dividend reinvestment plans.

    

    (ii) If
      the
      managing underwriter(s), if any, of an offering related to the Company
      Registration determines in its reasonable judgment that marketing factors
      require a limitation of the number of shares of Common Stock that can be
      included in such offering, the managing underwriter(s) may exclude the
      appropriate number of shares of Common Stock held by the stockholders of the
      Company, including Purchasers, from such registration. If the managing
      underwriter(s) determine(s) to exclude from such offering any Registrable
      Securities that Purchasers desire to include or any shares of Common Stock
      that
      other Company stockholders with applicable registration rights desire to
      include, Purchasers and such other Company stockholders (except for such Person
      or Persons, if any, upon whose demand such Company Registration is being made)
      shall share pro rata in the portion of such offering available to them (the
      “Available
      Portion”),
      with
      Purchasers and each such other Company stockholder entitled to include in such
      Company Registration and related offering a number of shares of Common Stock
      equal to the product of (I) the Available Portion and (II) a fraction, the
      numerator of which is the total number of Registrable Securities which
      Purchasers desires to include in such Company Registration (in the case of
      Purchasers) or the total number of shares of Common Stock which such other
      Company stockholder desires to include in such Company Registration (in the
      case
      of each such other Company stockholder) and the denominator of which is (x)
      the
      total of the number of Registrable Securities which Purchasers desire to include
      in such Company Registration plus (y) the total number of shares of Common
      Stock
      that such other Company stockholders desire to include in such Company
      Registration.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    

    C.
      Notwithstanding anything contained herein to the contrary, the Purchasers agree
      as follows:

     

    (i) At
      any
      time when a Registration Statement is effective, upon written notice from
      the Company to Purchasers that the Company has determined in good faith that
      the
      sale of restricted stock pursuant to the Registration Statement would require
      disclosure of non-public material information, Purchasers shall suspend sales
      of
      restricted stock pursuant to such Registration Statement until such time as
      the
      Company notifies Purchasers that such material information has been disclosed
      to
      the public or has ceased to be material, or that sales pursuant to such
      Registration Statement may otherwise be resumed; provided, however, such
      restrictions shall not exceed (a) an aggregate of ninety (90) days in any year,
      (b) nor more than sixty (60) days during any single period of
      suspension.

     

    (ii) Notwithstanding
      any other provision of this Agreement, in the event that the Company undertakes
      a primary offering of shares of its unissued Common Stock, which may also
      include other securities, excluding a primary offering related to an employee
      benefit plan (a “Primary
      Offering”),
      in
      which all of the shares of restricted stock are not included, Purchasers shall
      not sell, transfer, make any short sale of, grant any option for the purchase
      of, or enter into any hedging or similar transaction with the same economic
      effect as a sale of, any Common Stock (or other securities) of the Company
      held
      by Purchasers (except for shares included in the Primary Offering), during
      the
      thirty (30) days prior to the commencement of any such Primary Offering and
      ending ninety (90) days after completion of any such Primary Offering, unless
      the Company, in the case of a non-underwritten Primary Offering, or the managing
      underwriter, in the case of an underwritten Primary Offering, otherwise agrees
      in writing. The Company may impose stop-transfer instructions with respect
      to
      the shares of Common Stock (or other securities) subject to the foregoing
      restriction until the end of said ninety (90) day period. 

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

    (b) Provisions
      Applying to All Registrations Under Section 4.14.

     

    (i) Selection
      of Underwriter.
      Any
      Company Registration and related offering shall be managed by the Company;
      the
      Company shall have the power to select the managing underwriter(s) for such
      offering, and shall in consultation with the managing underwriter(s) have the
      power to determine the offering price, the underwriting discounts and
      commissions, the terms of the underwriting agreement and, the timing of the
      registration and related offering. To the extent that Purchasers participate
      in
      a Company Registration and related offering, Purchasers shall enter into, and
      sell its Registrable Securities only pursuant to, the underwriting arranged
      by
      the Company, and shall either commit to attend the closing of the offering
      and
      take such other actions as may be reasonably necessary to effect Purchasers’
participation in the offering and to provide any assurances reasonably requested
      by the Company and the managing underwriter(s) in that regard, or shall deliver
      to the Company in custody certificates representing all Registrable Securities
      to be included in the registration and shall execute and deliver to the Company
      a custody agreement and a power of attorney, each in form and substance
      appropriate for the purpose of effecting Purchasers’ participation in the
      Company Registration and related offering and otherwise reasonably satisfactory
      to the Company. If Purchasers disapprove of the features of the Company
      Registration and related offering, Purchasers or such individual Purchaser,
      as
      the case may be, may withdraw therefrom (in whole or part) by written notice
      to
      the Company and the managing underwriter(s) delivered no later than ten days
      prior to the effectiveness of the applicable registration statement and the
      Registrable Securities of Purchasers shall thereupon be withdrawn from such
      registration.

    

    (ii) The
      Company shall furnish Purchasers such number of copies of a prospectus,
      including a preliminary prospectus, in conformity with the requirements of
      the
      Securities Act, and such other documents as they may reasonably request in
      order
      to facilitate the disposition of the Registrable Securities owned by it that
      are
      included in such registration;

    

    (iii) Whenever
      required to include Registrable Securities in any registration or to effect
      the
      registration of any Registrable Securities pursuant to this Agreement, the
      Company shall, as expeditiously as reasonably possible, prepare and file with
      the Commission a registration statement with respect to such Registrable
      Securities and use all commercially reasonable efforts to cause such
      registration statement to become effective, and use all commercially reasonable
      efforts to keep such registration statement effective until the earliest of
      (a)
      the date as of which all such Registrable Securities have been distributed
      by
      Purchasers, (b) the date as of which all of the Registrable Securities covered
      by such registration statement may be sold without restriction pursuant to
      Rule
      144(k)(or any successor thereto) promulgated by the Commission under the
      Securities Act, and (c) two years after the Closing Date. In addition, the
      Company shall use all commercially reasonable efforts to register and qualify
      the securities covered by such registration statement under such other
      securities or Blue Sky laws of such jurisdictions as shall be reasonably
      requested by the Purchasers, provided that the Company shall not be required
      in
      connection therewith or as a condition thereto to qualify as a broker-dealer
      in
      any states or jurisdictions or to do business or to file a general consent
      to
      service of process in any of such states or jurisdictions.

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

    (iv) All
      expenses, other than underwriting discounts and commissions incurred in
      connection the registrations contemplated herein, including, without limitation,
      all registration, filing and qualification fees, printers’ and accounting fees,
      fees and disbursements of counsel for the Company, and the reasonable fees
      and
      disbursements of one counsel for each selling Purchaser, shall be borne by
      the
      Company. 

     

    (c) Subject
      to the terms and conditions of this Agreement and the other Transaction
      Documents, the right to cause the Company to register Registrable Securities
      pursuant to this Agreement may be assigned by each Purchaser to any transferee
      or assignee of such securities; provided that said transferee or assignee is
      a
      transferee or assignee of at least five percent (5%) of the such Purchaser’s
      Registrable Securities.

     

    
      
        
          
            4.15  Qualifying
              Transaction.
              Within
              ninety (90) days following the date of the Debenture, the Company shall
              close a
              Qualifying Transaction.

             

            
              
                
                  
                    
                      4.16  Subordination
                        Agreements. Concurrent
                        with or prior to the execution of this Agreement, the Company
                        and DIA shall
                        execute and deliver to Purchaser a Subordination Agreement
                        in the form attached
                        hereto as Exhibit H-1 with respect to all present and future
                        indebtedness of DIA
                        to the Company, and concurrent with or prior to the closing
                        of the DIA
                        Transaction, each holder of a note or other indebtedness
                        from DIA shall execute
                        and deliver to Purchaser a Subordination Agreement in the
                        form attached hereto
                        as Exhibit H-2 with respect to such indebtedness.

                       

                    

                  

                

              

            

          

        

      

    

    ARTICLE
      V.

    SMALL
      BUSINESS INVESTMENT COMPANY

     

    5.1  Small
      Business Investment Company Provisions.
      The
      Company acknowledges that Trident is a small business investment company
      (“SBIC”)
      licensed by the United States Small Business Administration (the “SBA”),
      and
      makes the following representations, warranties and covenants to Trident for
      so
      long as the Debentures held by Trident are outstanding:

     

    (a)  Small
      Business Concern.
      The
      Company represents and warrants that it, taken together with its “affiliates”
(as that term is defined in 13 C.F.R. §121.103), is a “Small Business Concern”
within the meaning of 15 U.S.C. §662(5), that is Section 103(5) of the Small
      Business Investment Act of 1958, as amended (the “SBIC
      Act”),
      and
      the regulations thereunder, including 13 C.F.R. §107, and meets the applicable
      size eligibility criteria set forth in 13 C.F.R. §121.301(c)(1) or the industry
      standard covering the industry in which the Company is primarily engaged as
      set
      forth in 13 C.F.R. §121.301(c)(2). Neither the Company nor any of its
      Subsidiaries presently engages in any activities for which a small business
      investment company is prohibited from providing funds by the SBIC Act, including
      13 C.F.R. §107.

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

     

    (b)  Small
      Business Administration Documentation.
      On or
      before the Closing Date, Trident shall have received SBA Form 480 (Size Status
      Declaration) and SBA Form 652 (Assurance of Compliance) which have been
      completed and executed by the Company, and SBA Form 1031 (Portfolio Finance
      Report), Parts A and B of which have been completed by the Company (the
“SBA
      Documents”).

     

    (c)  Inspection.
      The
      Company will permit Trident or its representatives, at the Company’s expense,
      and examiners of the SBA to visit and inspect the properties and assets of
      the
      Company, to examine its books of account and records, and to discuss the
      Company’s affairs, finances and accounts with the Company’s officers, senior
      management and accountants, all at such reasonable times as may be requested
      by
      Trident or the SBA.

     

    (d)  Informational
      Covenant.
      Within
      sixty (60) calendar days after the end of the Company’s fiscal year, the Company
      will furnish or cause to be furnished to Trident information required by the
      SBA
      concerning the economic impact of Trident’s investment, for (or as of the end
      of) each fiscal year, including but not limited to: (i) board minutes, (ii)
      information concerning full-time equivalent employees, (iii) federal, state
      and
      local income taxes paid, (iv) gross revenue, (v) source of revenue growth,
      (vi)
      after-tax profit and loss, and (vii) and federal, state and local income tax
      withholding. Such information shall be forwarded by the Company on a form
      provided by Trident. The Company also will furnish or cause to be furnished
      to
      Trident such other information regarding the business, affairs and condition
      of
      the Company as Trident may from time to time reasonably request.

     

    (e)  Use
      of
      Proceeds.
      The
      Company will deliver to Trident from time to time promptly following Trident’s
      request, a written report, certified as correct by an officer, verifying the
      purposes and amounts for which proceeds from the Debenture have been disbursed.
      The Company will supply to Trident such additional information and documents
      as
      it may reasonably request with respect to the Company’s use of proceeds, and
      will permit Trident to have access to any and all the Company’s records and
      information and personnel as Trident deems necessary to verify how such proceeds
      have been or are being used, and to assure that the proceeds have been used
      for
      the purposes specified on Schedule
      4.9.

     

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

    

     

    (f)  Activities
      and Proceeds.

     

    
      
        (i)  Neither
          the Company nor any of its Affiliates will engage in any activities or
          use
          directly or indirectly the proceeds from the Debenture for any purpose
          for which
          a SBIC is prohibited from providing funds by the SBIC Act, including 13
          C.F.R.
§107.

         

        (ii)  Without
          obtaining the prior written approval of Trident the Company will not change,
          within one (1) year of the Closing Date, the Company’s business activity from
          that described on Schedule
          5.1(f)
          to a
          business activity which a SBIC is prohibited from providing funds by the
          SBIC
          Act. The Company agrees that any such changes in its business activity
          without
          such prior written consent of Trident will constitute a material breach
          of the
          obligations of the Company under the Transaction Documents (an “Activity
          Event of Default”).

      

    

     

    ARTICLE
      VI.

    MISCELLANEOUS

     

    
      6.1  Fees
        and Expenses.
        At the
        closing, the Company shall reimburse Trident for Purchasers’ legal fees and
        expenses up to the amount of $10,000. Except as expressly set forth above
        and in
        the Transaction Documents to the contrary, each party shall pay the fees
        and
        expenses of its advisers, counsel, accountants and other experts, if any,
        and
        all other expenses incurred by such party incident to the negotiation,
        preparation, execution, delivery and performance of this Agreement and the
        other
        Transaction Documents. The Company shall pay all transfer agent fees, stamp
        taxes and other taxes and duties levied in connection with the issuance of
        any
        Securities.

       

      6.1  Entire
        Agreement.
        The
        Transaction Documents, together with the exhibits and schedules thereto,
        contain
        the entire understanding of the parties with respect to the subject matter
        hereof and supersede all prior agreements and understandings, oral or written,
        with respect to such matters, which the parties acknowledge have been merged
        into such documents, exhibits and schedules.

    

     

    6.2  Notices.
      Any and
      all notices or other communications or deliveries required or permitted to
      be
      provided hereunder shall be in writing and shall be deemed given and effective
      on the earliest of (a) the date of transmission, if such notice or communication
      is delivered via facsimile at the facsimile number set forth on the signature
      pages attached hereto prior to 5:30 p.m. (Dallas, Texas time) on a Business
      Day,
      (b) the next Business Day after the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number set forth
      on
      the signature pages attached hereto on a day that is not a Business Day or
      later
      than 5:30 p.m. (Dallas, Texas time) on any Business Day, (c) the second Business
      Day following the date of mailing, if sent by U.S. nationally recognized
      overnight courier service, or (d) upon actual receipt by the party to whom
      such
      notice is required to be given. The address for such notices and communications
      shall be as set forth on the signature pages attached hereto.

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

     

    6.3  Amendments;
      Waivers.
      No
      provision of this Agreement may be waived or amended except in a written
      instrument signed, in the case of an amendment, by the Company and Purchasers
      holding a majority of the Underlying Shares or, in the case of a waiver, by
      the
      party against whom enforcement of any such waiver is sought. No waiver of any
      default with respect to any provision, condition or requirement of this
      Agreement shall be deemed to be a continuing waiver in the future or a waiver
      of
      any subsequent default or a waiver of any other provision, condition or
      requirement hereof, nor shall any delay or omission of either party to exercise
      any right hereunder in any manner impair the exercise of any such
      right.

     

    6.4  Construction.
      The
      headings herein are for convenience only, do not constitute a part of this
      Agreement and shall not be deemed to limit or affect any of the provisions
      hereof. The language used in this Agreement will be deemed to be the language
      chosen by the parties to express their mutual intent, and no rules of strict
      construction will be applied against any party.

     

    6.5  Successors
      and Assigns.
      This
      Agreement shall be binding upon and inure to the benefit of the parties and
      their successors and permitted assigns. The Company may not assign this
      Agreement or any rights or obligations hereunder without the prior written
      consent of each Purchaser. Each Purchaser may assign any or all of its rights
      under this Agreement to any Person to whom such Purchaser assigns or transfers
      any Securities, provided such transferee agrees in writing to be bound, with
      respect to the transferred Securities, by the provisions hereof that apply
      to
      such Purchaser.

     

    6.6  No
      Third-Party Beneficiaries.
      This
      Agreement is intended for the benefit of the parties hereto and their respective
      successors and permitted assigns and is not for the benefit of, nor may any
      provision hereof be enforced by, any other Person, except as otherwise set
      forth
      in Section 4.9.

     

    6.7  Governing
      Law.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of the Transaction Documents shall be governed by and construed and enforced
      in
      accordance with the internal laws of the State of Texas, without regard to
      the
      principles of conflicts of law thereof, except to the extent that the General
      Corporation Law of the State of Nevada (excluding any provisions thereof
      relating to conflict of laws) governs the affairs and operation of the Company.
      Each party agrees that all legal proceedings concerning the interpretations,
      enforcement and defense of the transactions contemplated by this Agreement
      and
      any other Transaction Documents (whether brought against a party hereto or
      its
      respective affiliates, directors, officers, shareholders, employees or agents)
      shall be commenced exclusively in the state and federal courts sitting in the
      City of Dallas, Texas. Each party hereby irrevocably submits to the exclusive
      jurisdiction of the state and federal courts sitting in the City of Dallas,
      Texas for the adjudication of any dispute hereunder or in connection herewith
      or
      with any transaction contemplated hereby or discussed herein (including with
      respect to the enforcement of any of the Transaction Documents), and hereby
      irrevocably waives, and agrees not to assert in any suit, action or proceeding,
      any claim that it is not personally subject to the jurisdiction of any such
      court, that such suit, action or proceeding is improper or inconvenient venue
      for such proceeding. THE
      PARTIES HEREBY WAIVE ALL RIGHTS TO A TRIAL BY JURY.
      If
      either party shall commence an action or proceeding to enforce any provisions
      of
      the Transaction Documents, then the prevailing party in such action or
      proceeding shall be reimbursed by the other party for its attorneys’ fees and
      other costs and expenses incurred with the investigation, preparation and
      prosecution of such action or proceeding.

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    6.8  Survival.
      The
      representations and warranties contained herein shall survive the Closing and
      the delivery of the Securities until the later of the satisfaction or complete
      conversion of the Debenture.

     

    6.9  Execution.
      This
      Agreement may be executed in two or more counterparts, all of which when taken
      together shall be considered one and the same agreement and shall become
      effective when counterparts have been signed by each party and delivered to
      the
      other party, it being understood that both parties need not sign the same
      counterpart. In the event that any signature is delivered by facsimile
      transmission, such signature shall create a valid and binding obligation of
      the
      party executing (or on whose behalf such signature is executed) with the same
      force and effect as if such facsimile signature page were an original
      thereof.

     

    6.10  Severability.
      If any
      provision of this Agreement is held to be invalid or unenforceable in any
      respect, the validity and enforceability of the remaining terms and provisions
      of this Agreement shall not in any way be affected or impaired thereby and
      the
      parties will attempt to agree upon a valid and enforceable provision that is
      a
      reasonable substitute therefor, and upon so agreeing, shall incorporate such
      substitute provision in this Agreement.

     

    6.11  Rescission
      and Withdrawal Right.
      Notwithstanding anything to the contrary contained in (and without limiting
      any
      similar provisions of) the Transaction Documents, whenever a Purchaser exercises
      a right, election, demand or option under a Transaction Document and the Company
      does not timely perform its related obligations within the periods therein
      provided, then such Purchaser may rescind or withdraw, in its sole discretion
      from time to time upon written notice to the Company, any relevant notice,
      demand or election in whole or in part without prejudice to its future actions
      and rights; provided,
      however,
      in the
      case of a rescission of an exercise of a Warrant, such Purchaser shall be
      required to return any shares of Common Stock subject to any such rescinded
      exercise notice.

     

    6.12  Replacement
      of Securities.
      If any
      certificate or instrument evidencing any Securities is mutilated, lost, stolen
      or destroyed, the Company shall issue or cause to be issued in exchange and
      substitution for and upon cancellation thereof, or in lieu of and substitution
      therefor, a new certificate or instrument, but only upon receipt of evidence
      reasonably satisfactory to the Company of such loss, theft or destruction and
      customary and reasonable indemnity, if requested. The applicants for a new
      certificate or instrument under such circumstances shall also pay any reasonable
      third-party costs associated with the issuance of such replacement
      Securities.

     

    6.13  Remedies.
      In
      addition to being entitled to exercise all rights provided herein or granted
      by
      law, including recovery of damages, Purchasers and the Company will be entitled
      to specific performance under the Transaction Documents. The parties agree
      that
      monetary damages may not be adequate compensation for any loss incurred by
      reason of any breach of obligations described in the foregoing sentence and
      hereby agrees to waive in any action for specific performance of any such
      obligation the defense that a remedy at law would be adequate.

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    6.14  Payment
      Set Aside.
      To the
      extent that the Company makes a payment or payments to any Purchaser pursuant
      to
      any Transaction Documents or a Purchaser enforces or exercises its rights
      thereunder, and such payment or payments or the proceeds of such enforcement
      or
      exercise or any part thereof are subsequently invalidated, declared to be
      fraudulent or preferential, set aside, recovered from, disgorged by or are
      required to be refunded, repaid or otherwise restored to the Company, a trustee,
      receiver or any other person under any law (including, without limitation,
      any
      bankruptcy law, state or federal law, common law or equitable cause of action),
      then to the extent of any such restoration the obligation or part thereof
      originally intended to be satisfied shall be revived and continued in full
      force
      and effect as if such payment had not been made or such enforcement or setoff
      had not occurred.

     

    6.15  Usury.
      To the
      extent it may lawfully do so, the Company hereby agrees not to insist upon
      or
      plead or in any manner whatsoever claim, and will resist any and all efforts
      to
      be compelled to take the benefit or advantage of, usury laws wherever enacted,
      now or at any time hereafter in force, in connection with any claim, action
      or
      proceeding that may be brought by Purchasers in order to enforce any right
      or
      remedy under any Transaction Documents. Notwithstanding any provision to the
      contrary contained in any Transaction Documents, it is expressly agreed and
      provided that the total liability of the Company under the Transaction Documents
      for payments in the nature of interest shall not exceed the maximum lawful
      rate
      authorized under applicable law or regulation (the “Maximum
      Rate”),
      and,
      without limiting the foregoing, in no event shall any rate of interest or
      default interest, or both of them, when aggregated with any other sums in the
      nature of interest that the Company may be obligated to pay under the
      Transaction Documents exceed such Maximum Rate. It is agreed that if the maximum
      contract rate of interest allowed by law or regulation and applicable to the
      Transaction Documents is increased or decreased by statute or any official
      governmental action subsequent to the date hereof, the new maximum contract
      rate
      of interest allowed by law or regulation will be the Maximum Rate applicable
      to
      the Transaction Documents from the effective date forward, unless such
      application is precluded by applicable law or regulation. If under any
      circumstances whatsoever, interest in excess of the Maximum Rate is paid by
      the
      Company to Purchasers with respect to indebtedness evidenced by the Transaction
      Documents, such excess shall be applied by Purchasers to the unpaid principal
      balance of any such indebtedness or be refunded to the Company, the manner
      of
      handling such excess to be at Purchasers’ election.

     

    6.16  Liquidated
      Damages.
      The
      Company’s obligations to pay any partial liquidated damages or other amounts
      owing under the Transaction Documents is a continuing obligation of the Company
      and shall not terminate until all unpaid partial liquidated damages and other
      amounts have been paid notwithstanding the fact that the instrument or security
      pursuant to which such partial liquidated damages or other amounts are due
      and
      payable shall have been canceled.

     

    
      
        
        

      

      
        35

        
          

        

      

      
        
        

      

    

     

    
      6.17  Confidentiality.
        Purchasers acknowledge that information concerning the DIA Transaction, the
        Qualifying Transaction and other matters that are the subject matter of this
        Agreement and which have been specifically designated as such by the Company
        may
        constitute material non-public information under United States federal
        securities laws, and that United States federal securities laws prohibit
        any
        person who has received material non-public information relating to the Company
        from purchasing or selling securities of the Company, or from communicating
        such
        information to any person under circumstances in which it is reasonably
        foreseeable that such person is likely to purchase or sell securities of
        the
        Company. Accordingly, until such time as any such non-public information
        has
        been adequately disseminated to the public, Purchasers shall not directly
        or
        indirectly, make any statements, public announcements or release to trade
        publications or the press with respect to the subject matter of this Agreement,
        purchase or sell any securities of the Company or communicate such information
        to any other person; subject, however, (i) to the right of Purchasers to
        exercise rights under the Transaction Documents, (ii) disclosures required
        by
        applicable law or the SBA, and (iii) disclosures required pursuant to any
        judicial proceeding or court order.

       

    

     

    (Signature
      Page Follows)

     

    

    
      
        
        

      

      
        36

        
          

        

      

      
        
        

      

    

     

    Exhibit
      10.2

    IN
      WITNESS WHEREOF,
      the
      parties hereto have caused this Securities Purchase Agreement to be duly
      executed by their respective authorized signatories as of the date first
      indicated above.

     

     

    
      	
              COMPANY

               

              ZONE
                MINING LIMITED

               

              By:
                /s/ Stephen P. Harrington                

              Name:
                Stephen P. Harrington

              Title:
                President

               

               

               

               

              ZM
                ACQUISTION CORP.

               

              By:
                /s/ Stephen P. Harrington                

              Name:
                Stephen P. Harrington                

              Title:
                President                        

            	
               

               

              Address
                for Notice and Delivery:

               

              111
                Presidential Blvd.

              Suite
                165

              Bala
                Cynwyd, PA 19004

              Telephone:
                (610) 771-0680

              Facsimile:
                (___) ___-____

              Attn:
                Stephen P. Harrington

               

               

               

            

    

    

     

    
      
        
        

      

      
        37

        
          

        

      

      
        
        

      

    

     

    Exhibit
      10.2

    PURCHASER
      SIGNATURE PAGE

    

    

    
      	 PURCHASERS:	 SUBSCRIPTION
              AMOUNT:
	 	 
	 	 
	 TRIDENT GROWTH FUND,
              L.P.	 $1,000,000

    

          

    By:
      TRIDENT MANAGEMENT, LLC, its

    GENERAL
      PARTNER

    

    
 

    By:
      /s/ Scotty Cook                

    Name:
      Scotty Cook                

    Title:
      Authorized Member

    

    Address
      for Notice and Delivery

    

    700
      Gemini

    Houston,
      TX 77058

    Telephone:
      (281) 488-8484

    Facsimile:
      (281) 488-5353

    Attn:
      Larry St. Martin

     

    
      
        
        

      

      
        38

        
          

        

      

      
        
        

      

    

     

    Exhibit
      10.2

     

     

    ATTACHMENTS

     

    
      
        	
                Exhibit
                  A

              	
                Form
                  of Debenture

              
	
                Exhibit
                  B

              	
                Form
                  of Security Agreement

              
	
                Exhibit
                  C

              	
                Form
                  of Warrant

              
	
                Exhibit
                  D

              	
                SBA
                  Form 480

              
	
                Exhibit
                  E

              	
                SBA
                  Form 652

              
	
                Exhibit
                  F

              	
                SBA
                  Form 1031

              
	
                Exhibit
                  G

              	
                Form
                  of DIA Security Agreement

              
	
                Exhibit
                  H

              	
                Subordination
                  Agreement

              
	 	 
	 	 
	
                Schedule
                  1.1

              	
                Terms
                  of DIA Transaction

              
	
                Schedule
                  3.1(a)

              	
                Subsidiaries

              
	
                Schedule
                  3.1(e)

              	
                Filings,
                  Consents and Approvals

              
	
                Schedule
                  3.1(g)

              	
                Capitalization

              
	
                Schedule
                  3.1(i)

              	
                Litigation

              
	
                Schedule
                  3.1(l)

              	
                Regulatory
                  Permits

              
	
                Schedule
                  3.1(m)

              	
                Title
                  to Assets (Outstanding liens)

              
	
                Schedule
                  3.1(n)

              	
                Intellectual
                  Property

              
	
                Schedule
                  3.1(r)

              	
                Certain
                  Fees (Broker Fees)

              
	
                Schedule
                  3.1(u)

              	
                Registration
                  Rights

              
	
                Schedule
                  3.1(cc)

              	
                Indebtedness

              
	
                Schedule
                  3.1(ff)

              	
                Material
                  Liabilities

              
	
                Schedule
                  3.1(gg)

              	
                Material
                  Agreements

              
	
                Schedule
                  3.1(hh)

              	
                Board
                  of Directors

              
	
                Schedule
                  3.1(ii)

              	
                Financial
                  Statements

              
	
                Schedule
                  4.8

              	
                Use
                  of Proceeds

              
	
                Schedule
                  5.1(f)

              	
                Business
                  Activity

              

      

    

     

    
      
        
        

      

      
        39

        
          

        

      

      
        
        

      

    

     

    
       

      Exhibit
        10.2

    

     

     

    DISCLOSURE
      SCHEDULE

    

    

    40

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