Document:

SHARE PURCHASE AGREEMENT

THIS AGREEMENT is made as of the 23rd day of May, 2006

AMONG:

            AMERICAN  UNITED  GLOBAL,  INC., a corporation  formed
            pursuant  to the  laws of the  State of  Delaware  and
            having an office for  business  located at 108 Village
            Square, #327 Somers, New York 10589

            ("AUGI")

AND:

            KRAFT RT.,  a company  formed  pursuant  to the laws of
            Hungary  and having an office for  business  located at
            Konkoly Thege u. 29-33 Budapest H-1121

            ("Kraft")

AND:

            The  shareholders of Kraft,  each of whom are set forth
            on the signature page of this Agreement

            (the "Kraft Shareholders")

WHEREAS:

A. The Kraft  Shareholders own 100 registered  ordinary  shares,  HUF 10,000 par
value each of Kraft,  constituting HUF 50,000,000  registered  capital of Kraft,
being 2.0% of the presently issued and outstanding Kraft Shares;

B. AUGI is a reporting  company whose common stock is quoted on the Pink Sheets;
and

C. The  respective  Boards of Directors of AUGI, and Kraft deem it advisable and
in the best interests of AUGI and Kraft that AUGI acquire and Kraft Shareholders
sell (the "Acquisition") pursuant to this Agreement.

NOW THEREFORE THIS AGREEMENT  WITNESSETH THAT in  consideration  of the premises
and the mutual covenants,  agreements,  representations and warranties contained
herein, and other good and valuable  consideration,  the receipt and sufficiency
of which is hereby acknowledged, the parties hereto hereby agree as follows:

                                  ARTICLE 1
                        DEFINITIONS AND INTERPRETATION

DEFINITIONS

1.1 In this Agreement the following terms will have the following meanings:

(a)         "ACQUISITION" means the Acquisition, at the Closing, of the ordinary
            shares of Kraft held by the Kraft  Shareholders  by AUGI pursuant to
            this Agreement;

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                                      -2-

(b)         "ACQUISITION  SHARES"  means the 2,000 AUGI  Preferred  Shares to be
            issued to the Kraft Shareholders at Closing pursuant to the terms of
            the Acquisition;

(c)         "AGREEMENT"  means this share purchase  agreement among AUGI, Kraft,
            and the Kraft Shareholders;

(d)         "AUGI ACCOUNTS PAYABLE AND  LIABILITIES"  means all accounts payable
            and liabilities of AUGI, on a consolidated  basis,  due and owing or
            otherwise   constituting  a  binding  obligation  of  AUGI  and  its
            subsidiaries  (other than a AUGI  Material  Contract) as of December
            31, 2005 as set forth is Schedule "A" hereto;

(e)         "AUGI ACCOUNTS  RECEIVABLE" means all accounts  receivable and other
            debts owing to AUGI,  on a  consolidated  basis,  as of December 31,
            2005 as set forth in Schedule "B" hereto;

(f)         "AUGI ASSETS" means the  undertaking and all the property and assets
            of the AUGI  Business  of every  kind  and  description  wheresoever
            situated  including,   without  limitation,   AUGI  Equipment,  AUGI
            Inventory, AUGI Material Contracts,  AUGI Accounts Receivable,  AUGI
            Cash,  AUGI  Intangible  Assets  and AUGI  Goodwill,  and all credit
            cards, charge cards and banking cards issued to AUGI;

(g)         "AUGI BANK ACCOUNTS" means all of the bank accounts,  lock boxes and
            safety deposit boxes of AUGI and its subsidiaries or relating to the
            AUGI Business as set forth in Schedule "C" hereto;

(h)         "AUGI BUSINESS" means all aspects of any business  conducted by AUGI
            and its subsidiaries;

(i)         "AUGI  CASH"  means all cash on hand or on  deposit to the credit of
            AUGI and its subsidiaries on the Closing Date;

(j)         "AUGI COMMON SHARES" means the shares of common stock in the capital
            of AUGI;

(k)         "AUGI DEBT TO RELATED  PARTIES"  means the debts owed by AUGI to any
            affiliate,  director or officer of AUGI as described in Schedule "D"
            hereto;

(l)         "AUGI  EQUIPMENT"  means all machinery,  equipment,  furniture,  and
            furnishings   used  in  the  AUGI   Business,   including,   without
            limitation,  the items more  particularly  described in Schedule "E"
            hereto;

(m)         "AUGI  FINANCIAL  STATEMENTS"  means,   collectively,   the  audited
            consolidated  financial statements of AUGI for the fiscal year ended
            December 31, 2004,  together with the unqualified  auditors'  report
            thereon, and the unaudited consolidated financial statements of AUGI
            for the nine month period ended  September 30, 2005,  true copies of
            which are attached as Schedule "F" hereto;

(n)         "AUGI  GOODWILL"  means the goodwill of the AUGI Business  including
            the right to all  corporate,  operating  and trade names  associated
            with the AUGI  Business,  or any variations of such names as part of
            or in connection  with the AUGI Business,  all books and records and
            other  information  relating  to the AUGI  Business,  all  necessary
            licenses and  authorizations and any other rights used in connection
            with the AUGI Business;

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                                      -3-

(o)         "AUGI INSURANCE  POLICIES" means the public liability  insurance and
            insurance  against  loss or damage to the AUGI  Assets  and the AUGI
            Business as described in Schedule "G" hereto;

(p)         "AUGI INTANGIBLE  ASSETS" means all of the intangible assets of AUGI
            and its subsidiaries,  including, without limitation, AUGI Goodwill,
            all trademarks,  logos, copyrights,  designs, and other intellectual
            and industrial property of AUGI and its subsidiaries;

(q)         "AUGI  INVENTORY"  means  all  inventory  and  supplies  of the AUGI
            Business  as of December  31,  2005,  as set forth in  Schedule  "H"
            hereto; and

(r)         "AUGI  MATERIAL  CONTRACTS"  means the burden and benefit of and the
            right,  title and interest of AUGI and its  subsidiaries  in, to and
            under all trade and non-trade contracts, engagements or commitments,
            whether  written  or oral,  to which  AUGI or its  subsidiaries  are
            entitled whereunder AUGI or its subsidiaries are obligated to pay or
            entitled  to receive the sum of $10,000 or more  including,  without
            limitation,  any pension plans,  profit sharing plans,  bonus plans,
            loan agreements,  security  agreements,  indemnities and guarantees,
            any  agreements  with  employees,   lessees,  licensees,   managers,
            accountants,  suppliers, agents, distributors,  officers, directors,
            attorneys or others which cannot be terminated  without liability on
            not more than one  month's  notice,  and those  contracts  listed in
            Schedule "I" hereto.

(s)         "CLOSING"  means  the  completion,  on  the  Closing  Date,  of  the
            transactions  contemplated  hereby  in  accordance  with  Article  9
            hereof;

(t)         "CLOSING  DATE" means the day on which all  conditions  precedent to
            the completion of the transaction as  contemplated  hereby have been
            satisfied or waived, but in any event no later than 45 days from the
            completion  and  delivery  of  the  Kraft  Financials  to  AUGI  and
            Sichenzia Ross Friedman Ference LLP; provided however;

(U)         "FINANCING" is as defined in Section 7.3(i).

(v)         "KRAFT ACCOUNTS PAYABLE AND LIABILITIES"  means all accounts payable
            and liabilities of Kraft, due and owing or otherwise  constituting a
            binding  obligation of Kraft (other than a Kraft Material  Contract)
            as of December 31, 2005 as set forth in Schedule "J" hereto;

(w)         "KRAFT ACCOUNTS  RECEIVABLE" means all accounts receivable and other
            debts  owing to  Kraft,  as of  December  31,  2005 as set  forth in
            Schedule "K" hereto;

(x)         "KRAFT ASSETS" means the undertaking and all the property and assets
            of the Kraft  Business  of every  kind and  description  wheresoever
            situated  including,  without  limitation,  Kraft  Equipment,  Kraft
            Inventory,  Kraft Material  Contracts,  Kraft  Accounts  Receivable,
            Kraft Cash,  Kraft  Intangible  Assets and Kraft  Goodwill,  and all
            credit cards, charge cards and banking cards issued to Kraft;

(y)         "KRAFT BANK ACCOUNTS" means all of the bank accounts, lock boxes and
            safety  deposit boxes of Kraft or relating to the Kraft  Business as
            set forth in Schedule "L" hereto;

(z)         "KRAFT  BUSINESS"  means all aspects of the  business  conducted  by
            Kraft;

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                                      -4-

(aa)        "KRAFT  CASH"  means all cash on hand or on deposit to the credit of
            Kraft on the Closing Date;

(bb)        "KRAFT  DEBT TO RELATED  PARTIES"  means the debts owed by Kraft and
            its  subsidiaries to the Kraft  Shareholders or to any family member
            thereof,  or to any  affiliate,  director or officer of Kraft or the
            Kraft Shareholders as described in Schedule "M";

(cc)        "KRAFT  EQUIPMENT" means all machinery,  equipment,  furniture,  and
            furnishings   used  in  the  Kraft  Business,   including,   without
            limitation,  the items more  particularly  described in Schedule "N"
            hereto;

(dd)        "KRAFT  FINANCIAL   STATEMENTS"  means  collectively,   the  audited
            consolidated  financial  statements  of Kraft  for the  period  from
            inception to December 31, 2005 and any additional audited or interim
            financial  statements  as  required,  true  copies of which shall be
            attached as Schedule "O" hereto;

(ee)        "KRAFT  GOODWILL" means the goodwill of the Kraft Business  together
            with the exclusive right of AUGI to represent  itself as carrying on
            the Kraft  Business  in  succession  of Kraft  subject  to the terms
            hereof,  and the  right to use any words  indicating  that the Kraft
            Business  is so  carried  on  including  the  right  to use the name
            "Kraft" or "Kraft International" or any variation thereof as part of
            the name of or in  connection  with the Kraft  Business  or any part
            thereof  carried on or to be  carried on by Kraft,  the right to all
            corporate,  operating  and  trade  names  associated  with the Kraft
            Business,  or  any  variations  of  such  names  as  part  of  or in
            connection  with the Kraft  Business,  all  telephone  listings  and
            telephone advertising contracts,  all lists of customers,  books and
            records and other  information  relating to the Kraft Business,  all
            necessary  licenses and  authorizations and any other rights used in
            connection with the Kraft Business;

(ff)        "KRAFT INSURANCE  POLICIES" means the public liability insurance and
            insurance  against  loss or  damage  to Kraft  Assets  and the Kraft
            Business as described in Schedule "P" hereto;

(gg)        "KRAFT  INTANGIBLE  ASSETS"  means all of the  intangible  assets of
            Kraft,   including,   without   limitation,   Kraft  Goodwill,   all
            trademarks,  logos, copyrights,  designs, and other intellectual and
            industrial property of Kraft and its subsidiaries;

(hh)        "KRAFT  INVENTORY"  means all  inventory  and  supplies of the Kraft
            Business  as of  December  31,  2005 as set  forth in  Schedule  "Q"
            hereto;

(ii)        "KRAFT MATERIAL  CONTRACTS"  means the burden and benefit of and the
            right,  title and  interest  of Kraft in, to and under all trade and
            non-trade contracts,  engagements or commitments, whether written or
            oral,  to which  Kraft is  entitled  in  connection  with the  Kraft
            Business whereunder Kraft is obligated to pay or entitled to receive
            the  sum of  $10,000  or more  including,  without  limitation,  any
            pension plans,  profit sharing plans,  bonus plans, loan agreements,
            security agreements, indemnities and guarantees, any agreements with
            employees,  lessees, licensees,  managers,  accountants,  suppliers,
            agents, distributors, officers, directors, attorneys or others which
            cannot be terminated  without liability on not more than one month's
            notice, and those contracts listed in Schedule "R" hereto;

(jj)        "KRAFT  RELATED  PARTY  DEBTS"  means  the  debts  owed by the Kraft
            Shareholders or by any family member  thereof,  or by any affiliate,
            director or officer of Kraft or the Kraft Shareholders,  to Kraft as
            described in Schedule "S";

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                                      -5-

(kk)        "KRAFT  SHARES"  means all of the issued and  outstanding  shares of
            Kraft's equity stock;

(ll)        "PLACE OF CLOSING"  means the  offices of  Sichenzia  Ross  Friedman
            Ference  LLP,  or such  other  place as AUGI and Kraft may  mutually
            agree upon;

(mm)        "AUGI  PREFERRED  SHARES"  means the shares of Series B-4  Preferred
            Stock of AUGI,  each  share of which will be  automatically  convert
            into 350 shares of common stock of AUGI upon the Company  increasing
            its authorized shares of common stock and, prior to such conversion,
            the AUGI Preferred  Shares will have all the voting rights of shares
            of common stock of AUGI and vote  together with the shares of common
            stock of AUGI on all matters  which such shares will not be affected
            by the reverse stock split of AUGI's shares of common stock.

Any other terms defined within the text of this Agreement will have the meanings
so ascribed to them.

CAPTIONS AND SECTION NUMBERS

1.2 The headings and section references in this Agreement are for convenience of
reference  only and do not form a part of this Agreement and are not intended to
interpret,  define or limit the scope, extent or intent of this Agreement or any
provision thereof.

SECTION REFERENCES AND SCHEDULES

1.3 Any reference to a particular "Article", "section", "paragraph", "clause" or
other  subdivision  is to the  particular  Article,  section,  clause  or  other
subdivision  of this  Agreement  and any  reference to a Schedule by letter will
mean the appropriate  Schedule  attached to this Agreement and by such reference
the appropriate  Schedule is incorporated  into and made part of this Agreement.
The Schedules to this Agreement are as follows:

Information concerning AUGI

            Schedule "A" AUGI Accounts Payable and Liabilities
            Schedule "B" AUGI Accounts Receivable
            Schedule "C" AUGI Bank Accounts
            Schedule "D" AUGI Debts to Related Parties
            Schedule "E" AUGI Equipment
            Schedule "F" AUGI Financial Statements
            Schedule "G" AUGI Insurance Policies
            Schedule "H" AUGI Inventory
            Schedule "I" AUGI Material Contracts

Information concerning Kraft

            Schedule "J" Kraft Accounts Payable and Liabilities
            Schedule "K" Kraft Accounts Receivable
            Schedule "L" Kraft Bank Accounts
            Schedule "M" Kraft Debts to Related Parties
            Schedule "N" Kraft Equipment
            Schedule "O" Kraft Financial Statements
            Schedule "P" Kraft Insurance Policies
            Schedule "Q" Kraft Inventory

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                                      -6-

            Schedule "R" Kraft Material Contracts
            Schedule "S" Kraft Related Party Debts

Additional Information and Documents

            Schedule "T" AUGI Derivative Securities

SEVERABILITY OF CLAUSES

1.4 If any part of this  Agreement  is  declared  or held to be invalid  for any
reason, such invalidity will not affect the validity of the remainder which will
continue in full force and effect and be construed as if this Agreement had been
executed without the invalid portion, and it is hereby declared the intention of
the parties that this Agreement  would have been executed  without  reference to
any portion  which may,  for any  reason,  be  hereafter  declared or held to be
invalid.

                                  ARTICLE 2
                               THE ACQUISITION

SALE OF SHARES

2.1 The Kraft  Shareholders  hereby  agree to sell to AUGI the  Kraft  Shares in
exchange for the Acquisition  Shares on the Closing Date and to transfer to AUGI
on the Closing  Date a 100%  undivided  interest in and to the Kraft Shares free
from all liens, mortgages,  charges, pledges, encumbrances or other burdens with
all rights now or thereafter attached thereto.

ALLOCATION OF CONSIDERATION

2.2 The Acquisition  Shares shall be allocated to the Kraft  Shareholders on the
basis  of 20  Acquisition  Shares  for  each  one  Kraft  Share  held by a Kraft
Shareholder as set forth in Schedule 2.2 attached hereto.

ADHERENCE WITH APPLICABLE SECURITIES LAWS

2.2 The Kraft  Shareholders agree that they are acquiring the Acquisition Shares
for investment purposes and will not offer, sell or otherwise  transfer,  pledge
or hypothecate any of the Acquisition Shares issued to them (other than pursuant
to an effective  Registration  Statement  under the  Securities  Act of 1933, as
amended) directly or indirectly unless:

         (a)      the sale is to AUGI;

         (b)      the sale is made pursuant to the exemption  from  registration
                  under the Securities Act of 1933, as amended, provided by Rule
                  144 thereunder; or

         (c)      the Acquisition Shares are sold in a transaction that does not
                  require  registration  under the  Securities  Act of 1933,  as
                  amended,  or any  applicable  United  States  state  laws  and
                  regulations  governing the offer and sale of  securities,  and
                  the vendor has furnished to AUGI an opinion of counsel to that
                  effect or such  other  written  opinion  as may be  reasonably
                  required by AUGI.

      The Kraft Shareholders acknowledge that the certificates  representing the
Acquisition Shares shall bear the following legend:

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                                      -7-

            NO SALE,  OFFER TO SELL,  OR TRANSFER OF THE SHARES  REPRESENTED  BY
            THIS CERTIFICATE SHALL BE MADE UNLESS A REGISTRATION STATEMENT UNDER
            THE FEDERAL  SECURITIES ACT OF 1933, AS AMENDED,  IN RESPECT OF SUCH
            SHARES  IS THEN IN  EFFECT  OR AN  EXEMPTION  FROM THE  REGISTRATION
            REQUIREMENTS OF SAID ACT IS THEN IN FACT APPLICABLE TO SAID SHARES.

                                  ARTICLE 3
                        REPRESENTATIONS AND WARRANTIES
                                   OF AUGI

REPRESENTATIONS AND WARRANTIES

3.1 AUGI hereby  represents  and warrants in all material  respects to Kraft and
the Kraft  Shareholders,  with the intent that Kraft and the Kraft  Shareholders
will  rely  thereon  in  entering  into  this  Agreement  and in  approving  and
completing the transactions contemplated hereby, that:

AUGI - CORPORATE STATUS AND CAPACITY

         (a)      Incorporation.  AUGI is a corporation  duly  incorporated  and
                  upon  filing and paying  the  franchise  tax with the state of
                  Delaware AUGI will be validly subsisting under the laws of the
                  State of Delaware and in good  standing with the office of the
                  Secretary of State for the State of Delaware;

         (b)      Carrying on Business.  AUGI conducts the business described in
                  its filings with the  Securities  and Exchange  Commission and
                  does not conduct any other  business.  AUGI is duly authorized
                  to carry on such business in New York, New York. The nature of
                  the  AUGI  Business  does  not  require  AUGI to  register  or
                  otherwise  be  qualified  to carry on  business  in any  other
                  jurisdictions;

         (c)      Corporate Capacity. AUGI has the corporate power, capacity and
                  authority  to own  the  AUGI  Assets  and to  enter  into  and
                  complete this Agreement;

         (d)      Reporting  Status;  Listing.  AUGI is required to file current
                  reports with the Securities and Exchange  Commission  pursuant
                  to section 15(d) of the  Securities  Exchange Act of 1934, the
                  AUGI  Common  Shares  are quoted on the Pink  Sheets,  and all
                  reports  required to be filed by AUGI with the  Securities and
                  Exchange Commission or NASD have been filed;

AUGI - CAPITALIZATION

         (e)      Authorized Capital. The authorized capital of AUGI consists of
                  40,000,000  AUGI Common Shares,  $0.01 par value and 2,455,094
                  shares  of  preferred   stock.   $0.01  par  value,  of  which
                  10,877,499 AUGI Common Shares, and 303,599 shares of preferred
                  stock are presently issued and outstanding;

         (f)      No  Option,  Warrant  or Other  Right.  Except as set forth on
                  Schedule  "T",  no  person,   firm  or  corporation   has  any
                  agreement,  option,  warrant,  preemptive  right or any  other
                  right  capable of becoming an  agreement,  option,  warrant or
                  right for the  acquisition  of AUGI  Common  Shares or for the
                  purchase,  subscription  or  issuance  of any of the  unissued
                  shares in the capital of AUGI;

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                                      -8-

AUGI - RECORDS AND FINANCIAL STATEMENTS

         (g)      Charter  Documents.  The  charter  documents  of AUGI  and its
                  subsidiaries  have not been altered since the incorporation of
                  each,  respectively,  except as filed in the  record  books of
                  AUGI or its subsidiaries, as the case may be;

         (h)      Corporate Minute Books. The corporate minute books of AUGI and
                  its   subsidiaries  are  complete  and  each  of  the  minutes
                  contained  therein  accurately  reflect the actions  that were
                  taken at a duly called and held meeting or by consent  without
                  a  meeting.  All  actions by AUGI and its  subsidiaries  which
                  required director or shareholder approval are reflected on the
                  corporate minute books of AUGI and its subsidiaries.  AUGI and
                  its  subsidiaries  are not in  violation  or breach  of, or in
                  default  with  respect  to,  any  term  of  their   respective
                  Certificates of Incorporation (or other charter  documents) or
                  by-laws.

         (i)      AUGI  Financial  Statements.  The  AUGI  Financial  Statements
                  present  fairly,  in all  material  respects,  the  assets and
                  liabilities   (whether   accrued,   absolute,   contingent  or
                  otherwise)  of  AUGI,  on a  consolidated  basis,  as  of  the
                  respective  dates  thereof,  and the sales and earnings of the
                  AUGI  Business  during the  periods  covered  thereby,  in all
                  material  respects  and  have  been  prepared  in  substantial
                  accordance  with  generally  accepted  accounting   principles
                  consistently applied;

         (j)      AUGI Accounts Payable and  Liabilities.  There are no material
                  liabilities,   contingent  or   otherwise,   of  AUGI  or  its
                  subsidiaries which are not disclosed in Schedule "A" hereto or
                  reflected  in  the  AUGI  Financial  Statements  except  those
                  incurred in the ordinary  course of business since the date of
                  the said  schedule  and the  AUGI  Financial  Statements,  and
                  neither AUGI nor its subsidiaries have guaranteed or agreed to
                  guarantee  any  debt,  liability  or other  obligation  of any
                  person,  firm or corporation.  Without limiting the generality
                  of the foregoing, all accounts payable and liabilities of AUGI
                  as of December 31, 2005, are described in Schedule "A" hereto;

         (k)      AUGI Accounts  Receivable.  All the AUGI  Accounts  Receivable
                  result  from  bona fide  business  transactions  and  services
                  actually  rendered  without,  to the  knowledge  and belief of
                  AUGI,  any claim by the obligor  for set-off or  counterclaim.
                  Without limiting the generality of the foregoing, all accounts
                  receivable  of AUGI as of December 31, 2005,  are described in
                  Schedule "B" hereto;

         (l)      AUGI  Bank  Accounts.  All of the AUGI  Bank  Accounts,  their
                  location,  numbers and the authorized  signatories thereto are
                  as set forth in Schedule "C" hereto;

         (m)      No Debt to Related  Parties.  Except as  disclosed in Schedule
                  "D" hereto,  neither AUGI nor any of its  subsidiaries is, and
                  on Closing will not be, indebted to any affiliate, director or
                  officer  of AUGI  except  accounts  payable on account of bona
                  fide business  transactions  of AUGI incurred in normal course
                  of the AUGI Business, including employment agreements, none of
                  which are more than 30 days in arrears;

         (n)      No  Related  Party  Debt to AUGI.  No  director  or officer or
                  affiliate  of AUGI is now  indebted to or under any  financial
                  obligation   to  AUGI  or  any   subsidiary   on  any  account
                  whatsoever, except for advances on account of travel and other
                  expenses not exceeding $1,000 in total;

         (o)      No  Dividends.  No  dividends  or other  distributions  on any
                  shares in the  capital  of AUGI have been  made,  declared  or
                  authorized since the date of AUGI Financial Statements;

<PAGE>
                                      -9-

         (p)      No  Payments.  No  payments  of any  kind  have  been  made or
                  authorized since the date of the AUGI Financial  Statements to
                  or on behalf of officers, directors, shareholders or employees
                  of AUGI or its subsidiaries or under any management agreements
                  with AUGI or its  subsidiaries,  except  payments  made in the
                  ordinary course of business and at the regular rates of salary
                  or other remuneration payable to them;

         (q)      No Pension Plans. There are no pension,  profit sharing, group
                  insurance  or  similar  plans or other  deferred  compensation
                  plans affecting AUGI;

         (r)      No  Adverse  Events.  Since  the  date of the  AUGI  Financial
                  Statements

                  (i)      there has not been any material adverse change in the
                           consolidated financial position or condition of AUGI,
                           its subsidiaries,  its liabilities or the AUGI Assets
                           or any damage,  loss or other change in circumstances
                           materially  affecting  AUGI, the AUGI Business or the
                           AUGI  Assets  or  AUGI'  right  to  carry on the AUGI
                           Business,  other than changes in the ordinary  course
                           of business,

                  (ii)     there has not been any damage,  destruction,  loss or
                           other event  (whether  or not  covered by  insurance)
                           materially   and  adversely   affecting   AUGI,   its
                           subsidiaries, the AUGI Business or the AUGI Assets,

                  (iii)    there  has not  been  any  material  increase  in the
                           compensation  payable or to become payable by AUGI to
                           any of AUGI'  officers,  employees  or  agents or any
                           bonus,  payment or arrangement made to or with any of
                           them,

                  (iv)     the  AUGI  Business  has  been  and  continues  to be
                           carried on in the ordinary course,

                  (v)      AUGI  has not  waived  or  surrendered  any  right of
                           material value,

                  (vi)     neither AUGI nor its subsidiaries  have discharged or
                           satisfied  or  paid  any  lien  or   encumbrance   or
                           obligation   or   liability    other   than   current
                           liabilities in the ordinary course of business, and

                  (vii)    no   capital   expenditures   in  excess  of  $10,000
                           individually or $30,000 in total have been authorized
                           or made.

AUGI - INCOME TAX MATTERS

         (s)      Tax  Returns.  Except for the form  1120s for the years  ended
                  2002,  2003  and 2004 to be filed  with the  Internal  Revenue
                  Service,   all  tax  returns  and  reports  of  AUGI  and  its
                  subsidiaries  required  by law to be filed have been filed and
                  are true,  complete  and  correct,  and any taxes  payable  in
                  accordance with any return filed by AUGI and its  subsidiaries
                  or in accordance with any notice of assessment or reassessment
                  issued by any taxing authority have been so paid;

         (t)      Current Taxes.  Adequate  provisions  have been made for taxes
                  payable for the  current  period for which tax returns are not
                  yet required to be filed and there are no agreements, waivers,
                  or other arrangements  providing for an extension of time with
                  respect to the filing of any tax return by, or payment of, any
                  tax,   governmental  charge  or  deficiency  by  AUGI  or  its
                  subsidiaries.   AUGI  is  not  aware  of  any  contingent  tax
                  liabilities  or any grounds which would prompt a  reassessment
                  including  aggressive  treatment  of income  and  expenses  in
                  filing earlier tax returns;

<PAGE>
                                      -10-

AUGI - APPLICABLE LAWS AND LEGAL MATTERS

         (u)      Licenses.  AUGI and its  subsidiaries  hold all  licenses  and
                  permits as may be requisite  for carrying on the AUGI Business
                  in the  manner in which it has  heretofore  been  carried  on,
                  which  licenses and permits have been  maintained and continue
                  to be in good  standing  except where the failure to obtain or
                  maintain  such  licenses or permits  would not have a material
                  adverse effect on the AUGI Business;

         (v)      Applicable Laws.  Neither AUGI nor its subsidiaries  have been
                  charged  with  or  received  notice  of  breach  of any  laws,
                  ordinances, statutes, regulations,  by-laws, orders or decrees
                  to which they are subject or which apply to them the violation
                  of which  would  have a  material  adverse  effect on the AUGI
                  Business,  and neither AUGI nor its subsidiaries are in breach
                  of any laws, ordinances, statutes, regulations, bylaws, orders
                  or  decrees  the  contravention  of which  would  result  in a
                  material adverse impact on the AUGI Business;

         (w)      Pending  or  Threatened  Litigation.   There  is  no  material
                  litigation  or  administrative   or  governmental   proceeding
                  pending  or  threatened  against  or  relating  to  AUGI,  its
                  subsidiaries, the AUGI Business, or any of the AUGI Assets nor
                  does AUGI have any knowledge of any deliberate act or omission
                  of AUGI or its subsidiaries that would form any material basis
                  for any such action or proceeding;

         (x)      No Bankruptcy. Neither AUGI nor its subsidiaries have made any
                  voluntary   assignment  or  proposal  under   applicable  laws
                  relating  to  insolvency  and  bankruptcy  and  no  bankruptcy
                  petition  has been  filed  or  presented  against  AUGI or its
                  subsidiaries and no order has been made or a resolution passed
                  for the winding-up,  dissolution or liquidation of AUGI or its
                  subsidiaries;

         (y)      Labor Matters.  Neither AUGI nor its subsidiaries are party to
                  any  collective  agreement  relating to the AUGI Business with
                  any labor union or other  association of employees and no part
                  of the AUGI Business has been certified as a unit  appropriate
                  for  collective  bargaining  or, to the knowledge of AUGI, has
                  made any attempt in that regard;

         (z)      Finder's Fees.  Neither AUGI nor its subsidiaries are party to
                  any agreement which provides for the payment of finder's fees,
                  brokerage fees, commissions or other fees or amounts which are
                  or may become  payable to any third party in  connection  with
                  the  execution   and  delivery  of  this   Agreement  and  the
                  transactions contemplated herein;

EXECUTION AND PERFORMANCE OF AGREEMENT

         (aa)     Authorization and  Enforceability.  The execution and delivery
                  of this  Agreement,  and the  completion  of the  transactions
                  contemplated  hereby, have been duly and validly authorized by
                  all necessary corporate action on the part of AUGI;

         (bb)     No Violation or Breach.  The execution and performance of this
                  Agreement will not:

<PAGE>
                                      -11-

                  (i)      violate  the charter  documents  of AUGI or result in
                           any breach of, or default under,  any loan agreement,
                           mortgage,  deed of trust,  or any other  agreement to
                           which AUGI or its subsidiaries are party,

                  (ii)     give any person any right to  terminate or cancel any
                           agreement  including,  without  limitation,  the AUGI
                           Material Contracts, or any right or rights enjoyed by
                           AUGI or its subsidiaries,

                  (iii)    result   in   any   alteration   of   AUGI'   or  its
                           subsidiaries'  obligations  under  any  agreement  to
                           which AUGI or its  subsidiaries  are party including,
                           without limitation, the AUGI Material Contracts,

                  (iv)     result in the  creation  or  imposition  of any lien,
                           encumbrance or  restriction of any nature  whatsoever
                           in favor of a third  party upon or  against  the AUGI
                           Assets,

                  (v)      result in the imposition of any tax liability to AUGI
                           or its subsidiaries relating to the AUGI Assets, or

                  (vi)     violate  any court  order or  decree to which  either
                           AUGI or its subsidiaries are subject;

THE AUGI ASSETS - OWNERSHIP AND CONDITION

         (cc)     Business Assets.  The AUGI Assets comprise all of the property
                  and assets of the AUGI Business,  and no other person, firm or
                  corporation  owns any assets used by AUGI or its  subsidiaries
                  in operating the AUGI Business,  whether under a lease, rental
                  agreement  or other  arrangement,  other than as  disclosed in
                  Schedules "E" or "H" hereto;

         (dd)     Title.  AUGI or its  subsidiaries are the legal and beneficial
                  owner of the AUGI  Assets,  free and  clear of all  mortgages,
                  liens, charges, pledges,  security interests,  encumbrances or
                  other  claims  whatsoever,  save and  except as  disclosed  in
                  Schedules "E" or "H" hereto;

         (ee)     No Option. No person, firm or corporation has any agreement or
                  option or a right  capable of  becoming an  agreement  for the
                  purchase of any of the AUGI Assets;

         (ff)     AUGI Insurance  Policies.  AUGI and its subsidiaries  maintain
                  the public liability  insurance and insurance  against loss or
                  damage to the AUGI Assets and the AUGI  Business as  described
                  in Schedule "G" hereto;

         (gg)     AUGI Material Contracts. The AUGI Material Contracts listed in
                  Schedule "I" constitute all of the material  contracts of AUGI
                  and its subsidiaries;

         (hh)     No  Default.  There has not been any  default in any  material
                  obligation  of AUGI or any other party to be  performed  under
                  any of the AUGI Material  Contracts,  each of which is in good
                  standing and in full force and effect and unamended (except as
                  disclosed in Schedule  "I"  hereto),  and AUGI is not aware of
                  any  default in the  obligations  of any other party to any of
                  the AUGI Material Contracts;

         (ii)     No  Compensation  on  Termination.  There  are no  agreements,
                  commitments  or  understandings  relating to severance  pay or
                  separation  allowances  on  termination  of  employment of any
                  employee  of AUGI or its  subsidiaries.  Neither  AUGI nor its
                  subsidiaries are obliged to pay benefits or share profits with
                  any  employee  after   termination  of  employment  except  as
                  required by law;

<PAGE>
                                      -12-

AUGI ASSETS - AUGI EQUIPMENT

         (jj)     AUGI  Equipment.  The AUGI Equipment has been  maintained in a
                  manner consistent with that of a reasonably  prudent owner and
                  such equipment is in good working condition;

AUGI ASSETS - AUGI GOODWILL AND OTHER ASSETS

         (kk)     AUGI Goodwill. AUGI and its subsidiaries does not carry on the
                  AUGI Business  under any other  business or trade names.  AUGI
                  does not have any knowledge of any infringement by AUGI or its
                  subsidiaries  of any patent,  trademarks,  copyright  or trade
                  secret;

THE AUGI BUSINESS

         (ll)     Maintenance of Business.  Since the date of the AUGI Financial
                  Statements,  AUGI and its  subsidiaries  have not entered into
                  any material  agreement or  commitment  except in the ordinary
                  course and except as disclosed herein;

         (mm)     Subsidiaries.  AUGI does not own any subsidiaries and does not
                  otherwise own, directly or indirectly,  any shares or interest
                  in any other corporation,  partnership, joint venture or firm;
                  and

AUGI - ACQUISITION SHARES

         (nn)     Acquisition  Shares.  The Acquisition Shares when delivered to
                  the Kraft  Shareholders  pursuant to the Acquisition  shall be
                  validly   issued   and   outstanding   as   fully   paid   and
                  non-assessable  shares  and the  Acquisition  Shares  shall be
                  transferable  upon the books of AUGI,  in all cases subject to
                  the provisions and  restrictions of all applicable  securities
                  laws.

NON-MERGER AND SURVIVAL

3.2 The  representations and warranties of AUGI contained herein will be true at
and as of Closing in all material  respects as though such  representations  and
warranties  were made as of such time.  Notwithstanding  the  completion  of the
transactions  contemplated  hereby, the waiver of any condition contained herein
(unless such waiver expressly  releases a party from any such  representation or
warranty)  or any  investigation  made by Kraft or the Kraft  Shareholders,  the
representations and warranties of AUGI shall survive the Closing.

INDEMNITY

3.3 AUGI agrees to indemnify and save harmless Kraft and the Kraft  Shareholders
from and against  any and all  claims,  demands,  actions,  suits,  proceedings,
assessments,  judgments,  damages,  costs,  losses and  expenses,  including any
payment made in good faith in settlement  of any claim  (subject to the right of
AUGI  to  defend  any  such  claim),  resulting  from  the  breach  by it of any
representation   or   warranty   made   under   this   Agreement   or  from  any
misrepresentation  in or  omission  from any  certificate  or  other  instrument
furnished  or to be  furnished  by  AUGI  to  Kraft  or the  Kraft  Shareholders
hereunder.

<PAGE>
                                      -13-

                                  ARTICLE 4
                              COVENANTS OF AUGI

COVENANTS

4.1     AUGI covenants and agrees with Kraft and the Kraft  Shareholders  that
it will:

         (a)      Conduct  of  Business.  Until the  Closing,  conduct  the AUGI
                  Business diligently and in the ordinary course consistent with
                  the  manner  in which  the AUGI  Business  generally  has been
                  operated up to the date of execution of this Agreement;

         (b)      Preservation  of  Business.  Until the  Closing,  use its best
                  efforts to preserve the AUGI Business and the AUGI Assets and,
                  without   limitation,   preserve  for  Kraft  AUGI's  and  its
                  subsidiaries'   relationships  with  any  third  party  having
                  business relations with them;

         (c)      Access. Until the Closing, give Kraft, the Kraft Shareholders,
                  and  their   representatives   full   access  to  all  of  the
                  properties, books, contracts, commitments and records of AUGI,
                  and  furnish  to  Kraft,  the  Kraft  Shareholders  and  their
                  representatives  all such  information  as they may reasonably
                  request; and

         (d)      Procure Consents. Until the Closing, take all reasonable steps
                  required to obtain,  prior to Closing, any and all third party
                  consents  required to permit the  Acquisition  and to preserve
                  and  maintain  the AUGI Assets  notwithstanding  the change in
                  control of Kraft arising from the Acquisition.

AUTHORIZATION

4.2 AUGI  hereby  agrees to  authorize  and direct any and all  federal,  state,
municipal,  foreign and  international  governments  and regulatory  authorities
having jurisdiction  respecting AUGI and its subsidiaries to release any and all
information in their  possession  respecting  AUGI and its  subsidiaries  to the
Kraft  Shareholders.  AUGI  shall  promptly  execute  and  deliver  to the Kraft
Shareholders  any and all  consents to the release of  information  and specific
authorizations  which the Kraft Shareholders  reasonably requires to gain access
to any and all such information.

SURVIVAL

4.3 The  covenants  set forth in this Article  shall survive the Closing for the
benefit of Kraft and the Kraft Shareholders.

                                  ARTICLE 5
                      REPRESENTATIONS AND WARRANTIES OF
                            THE KRAFT SHAREHOLDERS

REPRESENTATIONS AND WARRANTIES

5.1 The Kraft Shareholders hereby jointly and severally represent and warrant in
all  material  respects to AUGI,  with the intent  that it will rely  thereon in
entering into this Agreement and in approving and  completing  the  transactions
contemplated hereby, that:

<PAGE>
                                      -14-

KRAFT - COMPANY STATUS AND CAPACITY

         (a)      Formation.   Kraft  is  a  company  duly  formed  and  validly
                  subsisting under the laws of Hungary;

         (b)      Carrying  on  Business.  Kraft  carries on the Kraft  Business
                  primarily  in  Hungary  and  does not  carry  on any  material
                  business  activity  in any other  jurisdiction.  Kraft is duly
                  authorized  to carry on the Kraft  Business  in  Hungary.  The
                  nature  of the  Kraft  Business  does  not  require  Kraft  to
                  register or otherwise be qualified to carry on business in any
                  other jurisdiction;

         (c)      Legal  Capacity.  Kraft  has the  legal  power,  capacity  and
                  authority  to own Kraft  Assets,  to carry on the  Business of
                  Kraft and to enter into and complete this Agreement;

KRAFT - CAPITALIZATION

         (d)      Authorized  Capital.  The authorized capital of Kraft consists
                  of 5,000 shares of capital stock;

         (e)      Ownership of Kraft Shares.  The issued and  outstanding  share
                  capital of Kraft will on Closing consist of 5,000 shares, each
                  with HUF 10,000 par value,  each  ordinary  registered  shares
                  (equivalent  to common  stock under  Delaware  law) (being the
                  Kraft Shares), which shares on Closing shall be validly issued
                  and outstanding as fully paid and  non-assessable  shares. The
                  Kraft  Shareholders  will be at  Closing  the  registered  and
                  beneficial owners of the 5,000 Kraft Shares.  The Kraft Shares
                  owned by the Kraft  Shareholders  will on  Closing be free and
                  clear of any and all liens,  charges,  pledges,  encumbrances,
                  restrictions on transfer and adverse claims whatsoever;

         (f)      No  Option,  Warrant  or  Other  Right.  No  person,  firm  or
                  corporation  has any agreement,  option,  warrant,  preemptive
                  right or any other right  capable of  becoming  an  agreement,
                  option,  warrant or right for the  acquisition of Kraft Shares
                  held  by  the  Kraft   Shareholders   or  for  the   purchase,
                  subscription  or issuance of any of the unissued shares in the
                  capital of Kraft;

         (g)      No  Restrictions.  There are no  restrictions on the transfer,
                  sale or other  disposition  of Kraft  Shares  contained in the
                  charter documents of Kraft or under any agreement;

KRAFT - RECORDS AND FINANCIAL STATEMENTS

         (h)      Charter  Documents.  The charter  documents  of Kraft have not
                  been altered since its formation date,  except as filed in the
                  record books of Kraft;

         (i)      Minute Books.  The minute books of Kraft are complete and each
                  of  the  minutes  contained  therein  accurately  reflect  the
                  actions  that were taken at a duly called and held  meeting or
                  by consent  without a  meeting.  All  actions  by Kraft  which
                  required director or shareholder approval are reflected on the
                  corporate minute books of Kraft.  Kraft is not in violation or
                  breach  of, or in  default  with  respect  to, any term of its
                  Certificate of Incorporation  (or other charter  documents) or
                  by-laws.

         (j)      Kraft Financial  Statements.  The Kraft  Financial  Statements
                  present  fairly,  in all  material  respects,  the  assets and
                  liabilities   (whether   accrued,   absolute,   contingent  or
                  otherwise) of Kraft as of the date thereof,  and the sales and
                  earnings  of the Kraft  Business  during the  periods  covered
                  thereby,  in all material respects,  and have been prepared in
                  substantial  accordance  with  generally  accepted  accounting
                  principles consistently applied;

<PAGE>
                                      -15-

         (k)      Kraft Accounts Payable and Liabilities.  There are no material
                  liabilities,  contingent or otherwise,  of Kraft which are not
                  disclosed  in Schedule  "J" hereto or  reflected  in the Kraft
                  Financial  Statements  except  those  incurred in the ordinary
                  course of business since the date of the said schedule and the
                  Kraft  Financial  Statements,  and Kraft has not guaranteed or
                  agreed to guarantee any debt, liability or other obligation of
                  any  person,   firm  or  corporation.   Without  limiting  the
                  generality  of  the  foregoing,   all  accounts   payable  and
                  liabilities  of Kraft as of December 31, 2005 are described in
                  Schedule "J" hereto;

         (l)      Kraft Accounts  Receivable.  All the Kraft Accounts Receivable
                  result  from  bona fide  business  transactions  and  services
                  actually rendered without,  to the knowledge and belief of the
                  Kraft  Shareholders,  any claim by the  obligor for set-off or
                  counterclaim.   Without   limiting  the   generality   of  the
                  foregoing, all accounts receivable of Kraft as of December 31,
                  2005, are described in Schedule "K" hereto;

         (m)      Kraft Bank  Accounts.  All of the Kraft Bank  Accounts,  their
                  location,  numbers and the authorized  signatories thereto are
                  as set forth in Schedule "L" hereto;

         (n)      No Debt to Related  Parties.  Except as  disclosed in Schedule
                  "M" hereto,  Kraft is not and on Closing will not be, indebted
                  to the Kraft  Shareholders  nor to any family member  thereof,
                  nor to any  affiliate,  director  or  officer  of Kraft or the
                  Kraft Shareholders  except accounts payable on account of bona
                  fide business  transactions of Kraft incurred in normal course
                  of Kraft Business,  including  employment  agreements with the
                  Kraft  Shareholders,  none of which  are more  than 30 days in
                  arrears;

         (o)      No  Related  Party  Debt to  Kraft.  Except  as set  forth  on
                  Schedule "M" hereto,  no Kraft  Shareholder  nor any director,
                  officer or  affiliate of Kraft is now indebted to or under any
                  financial  obligation  to  Kraft  on any  account  whatsoever,
                  except for  advances  on account of travel and other  expenses
                  not exceeding $5,000 in total;

         (p)      No  Dividends.  No  dividends  or other  distributions  on any
                  shares in the  capital of Kraft have been  made,  declared  or
                  authorized since the date of the Kraft Financial Statements;

         (q)      No  Payments.  No  payments  of any  kind  have  been  made or
                  authorized since the date of the Kraft Financial Statements to
                  or on behalf of the Kraft  Shareholders  or to or on behalf of
                  officers,  directors,  shareholders  or  employees of Kraft or
                  under any management  agreements  with Kraft,  except payments
                  made in the  ordinary  course of  business  and at the regular
                  rates of salary or other remuneration payable to them;

         (r)      No Pension Plans. There are no pension,  profit sharing, group
                  insurance  or  similar  plans or other  deferred  compensation
                  plans  affecting  Kraft,  except  as set  forth  in the  Kraft
                  Financial Statements;

         (s)      No  Adverse  Events.  Since  the date of the  Kraft  Financial
                  Statements:

                  (i)      there has not been any material adverse change in the
                           consolidated   financial  position  or  condition  of
                           Kraft,  its  liabilities  or the Kraft  Assets or any
                           damage,   loss  or  other  change  in   circumstances
                           materially affecting Kraft, the Kraft Business or the
                           Kraft  Assets or Kraft's  right to carry on the Kraft
                           Business,  other than changes in the ordinary  course
                           of business,

<PAGE>
                                      -16-

                  (ii)     there has not been any damage,  destruction,  loss or
                           other event  (whether  or not  covered by  insurance)
                           materially and adversely  affecting  Kraft, the Kraft
                           Business or the Kraft Assets,

                  (iii)    there  has not  been  any  material  increase  in the
                           compensation payable or to become payable by Kraft to
                           the Kraft Shareholders or to any of Kraft's officers,
                           employees   or  agents  or  any  bonus,   payment  or
                           arrangement made to or with any of them,

                  (iv)     the  Kraft  Business  has  been and  continues  to be
                           carried on in the ordinary course,

                  (v)      Kraft  has not  waived  or  surrendered  any right of
                           material value,

                  (vi)     Kraft has not  discharged  or  satisfied  or paid any
                           lien or encumbrance or obligation or liability  other
                           than current  liabilities  in the ordinary  course of
                           business, and

                  (vii)    no   capital   expenditures   in  excess  of  $10,000
                           individually or $30,000 in total have been authorized
                           or made;

KRAFT - INCOME TAX MATTERS

         (t)      Tax Returns.  All tax returns and reports of Kraft required by
                  law to be filed  have been  filed and are true,  complete  and
                  correct,  and any taxes payable in accordance  with any return
                  filed by Kraft or in accordance  with any notice of assessment
                  or  reassessment  issued by any taxing  authority have been so
                  paid;

         (u)      Current Taxes.  Adequate  provisions  have been made for taxes
                  payable for the  current  period for which tax returns are not
                  yet required to be filed and there are no agreements, waivers,
                  or other arrangements  providing for an extension of time with
                  respect to the filing of any tax return by, or payment of, any
                  tax,  governmental charge or deficiency by Kraft. Kraft is not
                  aware of any contingent  tax  liabilities or any grounds which
                  would prompt a reassessment  including aggressive treatment of
                  income and expenses in filing earlier tax returns;

KRAFT - APPLICABLE LAWS AND LEGAL MATTERS

         (v)      Licenses.  Kraft  holds all  licenses  and  permits  as may be
                  requisite for carrying on the Kraft  Business in the manner in
                  which it has  heretofore  been carried on, which  licenses and
                  permits  have  been  maintained  and  continue  to be in  good
                  standing  except where the failure to obtain or maintain  such
                  licenses or permits would not have a material  adverse  effect
                  on the Kraft Business;

         (w)      Applicable  Laws.  Kraft has not been charged with or received
                  notice  of  breach   of  any   laws,   ordinances,   statutes,
                  regulations,  by-laws,  orders or  decrees  to which  they are
                  subject or which  applies to them the violation of which would
                  have a material adverse effect on the Kraft Business,  and, to
                  the  knowledge  of the  Kraft  Shareholders,  Kraft  is not in
                  breach  of  any  laws,  ordinances,   statutes,   regulations,
                  by-laws,  orders or decrees the  contravention  of which would
                  result in a material adverse impact on the Kraft Business;

<PAGE>
                                      -17-

         (x)      Pending  or  Threatened  Litigation.   There  is  no  material
                  litigation  or  administrative   or  governmental   proceeding
                  pending or threatened  against or relating to Kraft, the Kraft
                  Business,  or any  of  the  Kraft  Assets,  nor  do the  Kraft
                  Shareholders  have  any  knowledge  of any  deliberate  act or
                  omission of Kraft that would form any  material  basis for any
                  such action or proceeding;

         (y)      No Bankruptcy.  Kraft has not made any voluntary assignment or
                  proposal  under  applicable  laws relating to  insolvency  and
                  bankruptcy  and no  bankruptcy  petition  has  been  filed  or
                  presented  against  Kraft  and no  order  has  been  made or a
                  resolution   passed  for  the   winding-up,   dissolution   or
                  liquidation of Kraft;

         (z)      Labor Matters.  Kraft is not party to any collective agreement
                  relating to the Kraft  Business  with any labor union or other
                  association of employees and no part of the Kraft Business has
                  been certified as a unit appropriate for collective bargaining
                  or, to the knowledge of the Kraft  Shareholders,  has made any
                  attempt in that regard;

         (aa)     Finder's Fees.  Other than an agreement with Niklai & Partners
                  in  connection  with  raising  capital in  Hungary,  such that
                  Niklai & Partners will become  eligible to receive 7.5% of the
                  capital raised in Hungary, in the event that such capital will
                  be added to the US $5,250,000  raised in the US, or 10% in the
                  event that  capital  raised in Hungary will be included in the
                  US  $5,250,000 to be raised in the US, Kraft is not a party to
                  any agreement which provides for the payment of finder's fees,
                  brokerage fees, commissions or other fees or amounts which are
                  or may become  payable to any third party in  connection  with
                  the  execution   and  delivery  of  this   Agreement  and  the
                  transactions contemplated herein;

EXECUTION AND PERFORMANCE OF AGREEMENT

         (bb)     Authorization and  Enforceability.  The execution and delivery
                  of this  Agreement,  and the  completion  of the  transactions
                  contemplated  hereby, have been duly and validly authorized by
                  all necessary corporate action on the part of Kraft;

         (cc)     No Violation or Breach.  The execution and performance of this
                  Agreement will not

                  (i)      violate the charter  documents  of Kraft or result in
                           any breach of, or default under,  any loan agreement,
                           mortgage,  deed of trust,  or any other  agreement to
                           which Kraft is a party,

                  (ii)     give any person any right to  terminate or cancel any
                           agreement   including,   without  limitation,   Kraft
                           Material Contracts, or any right or rights enjoyed by
                           Kraft,

                  (iii)    result in any alteration of Kraft's obligations under
                           any  agreement  to which Kraft is a party  including,
                           without limitation, the Kraft Material Contracts,

                  (iv)     result in the  creation  or  imposition  of any lien,
                           encumbrance or  restriction of any nature  whatsoever
                           in favor of a third  party upon or against  the Kraft
                           Assets,

                  (v)      result  in the  imposition  of any tax  liability  to
                           Kraft  relating to Kraft Assets or the Kraft  Shares,
                           or

<PAGE>
                                      -18-

                  (vi)     violate  any court  order or  decree to which  either
                           Kraft is subject;

KRAFT ASSETS - OWNERSHIP AND CONDITION

         (dd)     Business  Assets.  The  Kraft  Assets,  comprise  all  of  the
                  property  and assets of the Kraft  Business,  and  neither the
                  Kraft  Shareholders nor any other person,  firm or corporation
                  owns any assets used by Kraft in operating the Kraft Business,
                  whether under a lease,  rental agreement or other arrangement,
                  other than as disclosed in Schedules "N" or "Q" hereto;

         (ee)     Title.  Kraft is the legal and  beneficial  owner of the Kraft
                  Assets,  free and  clear  of all  mortgages,  liens,  charges,
                  pledges,  security  interests,  encumbrances  or other  claims
                  whatsoever,  save and except as disclosed in Schedules  "N" or
                  "Q" hereto;

         (ff)     No Option. No person, firm or corporation has any agreement or
                  option or a right  capable of  becoming an  agreement  for the
                  purchase of any of the Kraft Assets;

         (gg)     Kraft Insurance Policies. Kraft maintains the public liability
                  insurance  and  insurance  against loss or damage to the Kraft
                  Assets and the Kraft  Business as  described  in Schedule  "P"
                  hereto;

         (hh)     Kraft Material Contracts.  The Kraft Material Contracts listed
                  in Schedule "R"  constitute  all of the material  contracts of
                  Kraft;

         (ii)     No  Default.  There has not been any  default in any  material
                  obligation  of Kraft or any other party to be performed  under
                  any of  Kraft  Material  Contracts,  each of  which is in good
                  standing and in full force and effect and unamended (except as
                  disclosed  in  Schedule  "R"),  and  Kraft is not aware of any
                  default in the  obligations  of any other  party to any of the
                  Kraft Material Contracts;

         (jj)     No  Compensation  on  Termination.  There  are no  agreements,
                  commitments  or  understandings  relating to severance  pay or
                  separation  allowances  on  termination  of  employment of any
                  employee  of Kraft.  Kraft is not  obliged to pay  benefits or
                  share  profits  with  any  employee   after   termination   of
                  employment except as required by law;

KRAFT ASSETS - KRAFT EQUIPMENT

         (kk)     Kraft Equipment.  The Kraft Equipment has been maintained in a
                  manner consistent with that of a reasonably  prudent owner and
                  such equipment is in good working condition;

KRAFT ASSETS - KRAFT GOODWILL AND OTHER ASSETS

         (ll)     Kraft Goodwill. Kraft carries on the Kraft Business only under
                  the name " Kraft  Rt." and  variations  thereof  and  under no
                  other business or trade names.  The Kraft  Shareholders do not
                  have any knowledge of any infringement by Kraft of any patent,
                  trademark, copyright or trade secret;

THE BUSINESS OF KRAFT

         (mm)     Maintenance of Business. Since the date of the Kraft Financial
                  Statements,  the Kraft  Business  has been  carried  on in the
                  ordinary  course and Kraft has not entered  into any  material
                  agreement or commitment except in the ordinary course; and

<PAGE>
                                      -19-

         (nn)     Subsidiaries. Kraft does not own any subsidiaries and does not
                  otherwise own, directly or indirectly,  any shares or interest
                  in any other corporation,  partnership,  joint venture or firm
                  and Kraft does not own any  subsidiary  and does not otherwise
                  own,  directly  or  indirectly,  any shares or interest in any
                  other corporation, partnership, joint venture or firm.

NON-MERGER AND SURVIVAL

5.2 The representations and warranties of Kraft contained herein will be true at
and as of Closing in all material  respects as though such  representations  and
warranties  were made as of such time.  Notwithstanding  the  completion  of the
transactions  contemplated  hereby, the waiver of any condition contained herein
(unless such waiver expressly  releases a party from any such  representation or
warranty) or any investigation made by AUGI, the  representations and warranties
of Kraft shall survive the Closing.

INDEMNITY

5.3 The Kraft  Shareholders  agree to indemnify  and save harmless AUGI from and
against any and all claims, demands, actions, suits,  proceedings,  assessments,
judgments,  damages,  costs, losses and expenses,  including any payment made in
good faith in settlement of any claim  (collectively,  the "Claims") (subject to
the right of the Kraft  Shareholders  to defend any such claim),  resulting from
the breach by any of them of any  representation  or warranty of such party made
under this  Agreement  or from any  misrepresentation  in or  omission  from any
certificate  or other  instrument  furnished  or to be furnished by Kraft or the
Kraft Shareholders to AUGI hereunder;  provided, however, the Kraft Shareholders
shall not be  required  to  indemnify  AUGI for any such Claims in excess of the
value of the Kraft Shares.

                                  ARTICLE 6
                            COVENANTS OF KRAFT AND
                            THE KRAFT SHAREHOLDERS

COVENANTS

6.1 Kraft  and the Kraft  Shareholders  covenant  and agree  with AUGI that they
will:

         (a)      Conduct of  Business.  Until the  Closing,  conduct  the Kraft
                  Business diligently and in the ordinary course consistent with
                  the  manner  in which the Kraft  Business  generally  has been
                  operated up to the date of execution of this Agreement;

         (b)      Preservation  of Business.  Until the Closing,  use their best
                  efforts to preserve  the Kraft  Business  and the Kraft Assets
                  and,   without   limitation,   preserve   for   AUGI   Kraft's
                  relationships  with  their  suppliers,  customers  and  others
                  having business relations with them;

         (c)      Access.  Until the Closing,  give AUGI and its representatives
                  full  access  to  all  of the  properties,  books,  contracts,
                  commitments and records of Kraft relating to Kraft,  the Kraft
                  Business  and the Kraft  Assets,  and  furnish to AUGI and its
                  representatives  all such  information  as they may reasonably
                  request;

         (d)      Procure Consents. Until the Closing, take all reasonable steps
                  required to obtain,  prior to Closing, any and all third party
                  consents  required to permit the  Acquisition  and to preserve
                  and maintain the Kraft Assets,  including  the Kraft  Material
                  Contracts,  notwithstanding  the  change in  control  of Kraft
                  arising from the Acquisition;

<PAGE>
                                      -20-

         (e)      Reporting and Internal  Controls.  From and after the Closing,
                  the  Kraft  Shareholders  shall  forthwith  take all  required
                  actions to  implement  internal  controls  on the  business of
                  Kraft to  ensure  that  Kraft  and AUGI  comply  with  Section
                  13(b)(2) of the Securities and Exchange Act of 1934;

         (f)      1934 Act Reports.  From and after the Closing  Date,  take all
                  such  steps  as  are  necessary  to  discharge  all  reporting
                  obligations  imposed upon them by the Securities  Exchange Act
                  of 1934; and

         (g)      Standstill;  Proxy.  From the date  hereof  until the  Closing
                  Date, the Kraft  Shareholders will take no action that will in
                  any way  affect  or  negatively  impact  this  Agreement,  the
                  Acquisition  or the Financing and they will not take any other
                  action  with  respect  to  their  shares  of  Kraft  including
                  entering into any agreement with respect to the disposition of
                  such shares  unless  such other  party  agrees to the terms of
                  this  Agreement.  Further,  provided  that  AUGI  successfully
                  completes the Financing  prior to the Closing Date, each Kraft
                  Shareholder  constitutes  and  appoints  Robert  Rubin or such
                  other  designee  of AUGI,  his,  her or its  true  and  lawful
                  attorney-in-fact  and agent, acting alone, with full powers of
                  substitution  and  resubstitution,  for him,  her or it and in
                  his,  her or its  name,  place  and  stead,  in  any  and  all
                  capacities,  to sign  any and all  documents  and to take  the
                  required action to close the  Acquisition,  granting unto said
                  attorney-in-fact and agent, each acting alone, full powers and
                  authority  to do and  perform  each and  every  act and  thing
                  requisite  and  necessary to be done,  as fully to all intents
                  and  purposes  as he,  she or it might or could do in  person,
                  hereby ratifying and confirming all said  attorney-in-fact and
                  agent,  acting alone,  or his substitute or  substitutes,  may
                  lawfully do or cause to be done by virtue hereof.

AUTHORIZATION

6.2 Kraft  hereby  agrees to authorize  and direct any and all  federal,  state,
municipal,  foreign and  international  governments  and regulatory  authorities
having jurisdiction respecting Kraft to release any and all information in their
possession respecting Kraft to AUGI. Kraft shall promptly execute and deliver to
AUGI  any  and  all  consents  to  the  release  of  information   and  specific
authorizations  which AUGI reasonably require to gain access to any and all such
information.

SURVIVAL

6.3 The  covenants  set forth in this Article  shall survive the Closing for the
benefit of AUGI.

                                  ARTICLE 7
                             CONDITIONS PRECEDENT

CONDITIONS PRECEDENT IN FAVOR OF AUGI

7.1 AUGI's  obligations to carry out the  transactions  contemplated  hereby are
subject to the fulfillment of each of the following  conditions  precedent on or
before the Closing:

         (a)      all  documents or copies of documents  required to be executed
                  and delivered to AUGI hereunder will have been so executed and
                  delivered;

<PAGE>
                                      -21-

         (b)      all of the terms,  covenants and  conditions of this Agreement
                  to be  complied  with  or  performed  by  Kraft  or the  Kraft
                  Shareholders  at or  prior  to  the  Closing  will  have  been
                  complied with or performed;

         (c)      title to the Kraft Shares held by the Kraft  Shareholders  and
                  to the Kraft  Assets will be free and clear of all  mortgages,
                  liens, charges, pledges,  security interests,  encumbrances or
                  other claims whatsoever,  save and except as disclosed herein,
                  and the Kraft Shares shall be duly transferred to AUGI;

         (d)      subject to Article 8 hereof, there will not have occurred

                  (i)      any material adverse change in the financial position
                           or condition of Kraft,  its  liabilities or the Kraft
                           Assets  or  any  damage,  loss  or  other  change  in
                           circumstances   materially  and  adversely  affecting
                           Kraft,  the Kraft  Business  or the  Kraft  Assets or
                           Kraft's right to carry on the Kraft  Business,  other
                           than changes in the ordinary course of business, none
                           of which has been materially adverse, or

                  (ii)     any  damage,   destruction,   loss  or  other  event,
                           including changes to any laws or statutes  applicable
                           to  Kraft  or  the  Kraft  Business  (whether  or not
                           covered  by  insurance)   materially   and  adversely
                           affecting  Kraft,  the  Kraft  Business  or the Kraft
                           Assets;

         (e)      the transactions  contemplated hereby shall have been approved
                  by all other regulatory  authorities having  jurisdiction over
                  the subject matter hereof, if any

         (f)      the transactions  contemplated hereby shall have been approved
                  by the Board of Directors and shareholders of Kraft; and

         (g)      on or prior to the Closing  Date,  Kraft shall have  delivered
                  the Kraft Financial Statements.

WAIVER BY AUGI

7.2 The conditions  precedent set out in the preceding  section are inserted for
the exclusive  benefit of AUGI and any such  condition may be waived in whole or
in part by AUGI at or prior to the  Closing  by  delivering  to Kraft a  written
waiver to that effect signed by AUGI. In the event that the conditions precedent
set out in the  preceding  section are not  satisfied  on or before the Closing,
AUGI shall be released from all obligations under this Agreement.

CONDITIONS PRECEDENT IN FAVOR OF KRAFT AND THE KRAFT SHAREHOLDERS

7.3 The  obligations  of Kraft  and the  Kraft  Shareholders  to  carry  out the
transactions  contemplated  hereby are subject to the fulfillment of each of the
following conditions precedent on or before the Closing:

         (a)      all  documents or copies of documents  required to be executed
                  and  delivered to Kraft  hereunder  will have been so executed
                  and delivered;

         (b)      all of the terms,  covenants and  conditions of this Agreement
                  to be complied  with or  performed  by AUGI at or prior to the
                  Closing will have been complied with or performed;

         (c)      AUGI will have delivered the  Acquisition  Shares to be issued
                  pursuant  to the  terms  of the  Acquisition  to  Kraft at the
                  Closing and the  Acquisition  Shares will be registered on the
                  books of AUGI in the name of the holder of Kraft Shares at the
                  time of Closing;

<PAGE>
                                      -22-

         (d)      title to the Acquisition  Shares will be free and clear of all
                  mortgages,   liens,  charges,   pledges,  security  interests,
                  encumbrances or other claims whatsoever;

         (e)      subject to Article 8 hereof, there will not have occurred

                  (i)      any material adverse change in the financial position
                           or  condition  of  AUGI,  its   subsidiaries,   their
                           liabilities or the AUGI Assets or any damage, loss or
                           other   change  in   circumstances   materially   and
                           adversely  affecting  AUGI,  the AUGI Business or the
                           AUGI  Assets  or  AUGI'  right  to  carry on the AUGI
                           Business,  other than changes in the ordinary  course
                           of  business,  none  of  which  has  been  materially
                           adverse, or

                  (ii)     any  damage,   destruction,   loss  or  other  event,
                           including changes to any laws or statutes  applicable
                           to AUGI or the AUGI Business  (whether or not covered
                           by  insurance)  materially  and  adversely  affecting
                           AUGI, its subsidiaries, the AUGI Business or the AUGI
                           Assets;

         (f)      the transactions  contemplated hereby shall have been approved
                  by all other regulatory  authorities having  jurisdiction over
                  the subject matter hereof, if any;

         (g)      the transactions  contemplated hereby shall have been approved
                  by the Board of Directors of AUGI;

         (i)      on or prior to the  Closing  Date,  close on a  minimum  of US
                  $6,000,000  financing in the form of a  convertible  debenture
                  financing (the "Financing"), in accordance with the Term Sheet
                  annexed hereto as Schedule 7.3(i);

         (h)      Zoltan Kiss shall have been  appointed  as the Chairman of the
                  Board of the Board of Directors of AUGI;

         (i)      on or prior to the Closing Date,  AUGI shall have entered into
                  a  settlement  agreement  with The  Rubin  Family  Trust  (the
                  "Trust")  whereby the Trust shall forgive all debt and related
                  interest owed to it by AUGI in  consideration  of the transfer
                  of all shares of AUGI  received by AUGI from  Michael  Vox, if
                  any,  and  all  securities  of  Informedix   Holdings,   Inc.,
                  Spongtech  Delivery  Systems,  Inc. and ScanTek Medical,  Inc.
                  held by AUGI and  transfer  of any  rights  held by AUGI  with
                  respect to any litigation  that may be brought by AUGI against
                  New York Medical Inc.; and

         (j)      on or prior to the  Closing  Date,  Rubin  Family  Irrevocable
                  Trust  (the  "Trust")  and  AUGI  shall  enter  into a  pledge
                  agreement  whereby the Trust  shall  agree to place  1,000,000
                  shares of AUGI common stock in an escrow  account for a period
                  of one (1) year from the Closing (the "Pledge Period"),  which
                  such shares  shall be utilized to satisfy any claim  commenced
                  by United Parcel  Service in connection  with the UPS Note. In
                  the event  that  United  Parcel  Service  commences  an action
                  against  AUGI with  respect to the UPS Note,  the Trust agrees
                  that during the Pledge  Period the Trust shall pledge  further
                  shares of AUGI  common  stock  equal to the value of the claim
                  divided the market price of AUGI at that time. The Trust shall
                  retain the  ability to settle any action  commenced  by United
                  Parcel Service.

<PAGE>
                                      -23-

WAIVER BY KRAFT AND THE KRAFT SHAREHOLDERS

7.4 The conditions  precedent set out in the preceding  section are inserted for
the exclusive benefit of Kraft and the Kraft Shareholders and any such condition
may be waived in whole or in part by Kraft or the Kraft Shareholders at or prior
to the Closing by delivering  to AUGI a written  waiver to that effect signed by
Kraft and the Kraft Shareholders. In the event that the conditions precedent set
out in the preceding  section are not satisfied on or before the Closing,  Kraft
and the Kraft  Shareholders  shall be released from all  obligations  under this
Agreement.

NATURE OF CONDITIONS PRECEDENT

7.5 The  conditions  precedent  set  forth in this  Article  are  conditions  of
completion  of the  transactions  contemplated  by  this  Agreement  and are not
conditions  precedent  to the  existence  of a  binding  agreement.  Each  party
acknowledges   receipt  of  the  sum  of  $1.00  and  other  good  and  valuable
consideration  as  separate  and  distinct  consideration  for  agreeing  to the
conditions of precedent in favor of the other party or parties set forth in this
Article.

TERMINATION

7.6  Notwithstanding  any provision herein to the contrary,  if the Closing does
not occur on or before 45 days from the  completion  and  delivery  of the Kraft
Financials to AUGI and Sichenzia  Ross  Friedman  Ference LLP (the  "Termination
Date"),  this  Agreement  will be at an end and will  have no  further  force or
effect, unless otherwise agreed upon by the parties in writing.

CONFIDENTIALITY

7.7  Notwithstanding  any provision  herein to the contrary,  the parties hereto
agree that the existence and terms of this Agreement are  confidential  and that
if this  Agreement is terminated  pursuant to the preceding  section the parties
agree to return to one another any and all  financial,  technical  and  business
documents  delivered  to the  other  party or  parties  in  connection  with the
negotiation  and  execution of this  Agreement  and shall keep the terms of this
Agreement and all information and documents received from Kraft and AUGI and the
contents  thereof  confidential  and not  utilize  nor reveal or  release  same,
provided,  however, that AUGI will be required to issue a news release regarding
the execution and  consummation  of this  Agreement and file a Current Report on
Form 8-K with the  Securities  and Exchange  Commission  respecting the proposed
Acquisition  contemplated  hereby  together  with such  other  documents  as are
required to maintain the  currency of AUGI's  filings  with the  Securities  and
Exchange Commission.

                                  ARTICLE 8
                                     RISK

MATERIAL CHANGE IN THE BUSINESS OF KRAFT

8.1 If any material loss or damage to the Kraft Business occurs prior to Closing
and such loss or damage,  in AUGI' reasonable  opinion,  cannot be substantially
repaired or replaced  within  sixty (60) days,  AUGI shall,  within two (2) days
following any such loss or damage, by notice in writing to Kraft, at its option,
either:

         (a)      terminate this Agreement, in which case no party will be under
                  any further obligation to any other party; or

         (b)      elect to complete the Acquisition  and the other  transactions
                  contemplated hereby, in which case the proceeds and the rights
                  to receive the proceeds of all insurance covering such loss or
                  damage will, as a condition  precedent to AUGI' obligations to
                  carry out the transactions  contemplated  hereby, be vested in
                  Kraft or otherwise  adequately  secured to the satisfaction of
                  AUGI on or before the Closing Date.

<PAGE>
                                      -24-

MATERIAL CHANGE IN THE AUGI BUSINESS

8.2 If any material loss or damage to the AUGI Business  occurs prior to Closing
and such loss or damage, in Kraft's reasonable opinion,  cannot be substantially
repaired or replaced  within sixty (60) days,  Kraft shall,  within two (2) days
following any such loss or damage,  by notice in writing to AUGI, at its option,
either:

         (a)      terminate this Agreement, in which case no party will be under
                  any further obligation to any other party; or

         (b)      elect to complete the Acquisition  and the other  transactions
                  contemplated hereby, in which case the proceeds and the rights
                  to receive the proceeds of all insurance covering such loss or
                  damage will, as a condition  precedent to Kraft's  obligations
                  to carry out the transactions  contemplated  hereby, be vested
                  in AUGI or otherwise adequately secured to the satisfaction of
                  Kraft on or before the Closing Date.

                                  ARTICLE 9
                                   CLOSING

CLOSING

9.1 The  Acquisition and the other  transactions  contemplated by this Agreement
will be closed at the Place of Closing on Closing  Date in  accordance  with the
closing procedure set out in this Article.

DOCUMENTS TO BE DELIVERED BY KRAFT

9.2 On or before the Closing,  Kraft and the Kraft  Shareholders will deliver or
cause to be delivered to AUGI:

         (a)      the original or certified  copies of the charter  documents of
                  Kraft, including amendments thereof, and all corporate records
                  documents and  instruments  of Kraft,  the  corporate  seal of
                  Kraft and all books and accounts of Kraft;

         (b)      all reasonable  consents or approvals  required to be obtained
                  by Kraft for the purposes of completing  the  Acquisition  and
                  preserving  and  maintaining  the interests of Kraft under any
                  and all Kraft  Material  Contracts  and in  relation  to Kraft
                  Assets;

         (c)      certified  copies  of  such  resolutions  and  minutes  of the
                  shareholders  and  directors  of Kraft as are  required  to be
                  passed to authorize the execution, delivery and implementation
                  of this Agreement;

         (d)      an  acknowledgement  from Kraft and the Kraft  Shareholders of
                  the  satisfaction  of the  conditions  precedent  set forth in
                  section 7.3 hereof;

         (e)      the  certificates  or other evidence of ownership of the Kraft
                  Shares,  together  with such other  documents  or  instruments
                  required to effect  transfer of  ownership of the Kraft Shares
                  to AUGI; and

<PAGE>
                                      -25-

         (f)      such other  documents as AUGI may  reasonably  require to give
                  effect to the terms and intention of this Agreement.

DOCUMENTS TO BE DELIVERED BY AUGI

9.3 On or before the  Closing,  AUGI shall  deliver or cause to be  delivered to
Kraft and the Kraft Shareholders:

         (a)      share  certificates  representing the Acquisition  Shares duly
                  registered  in the  names of the  holders  of  shares of Kraft
                  Common Stock;

         (b)      certified  copies of such resolutions of the directors of AUGI
                  as are  required  to be passed  to  authorize  the  execution,
                  delivery and implementation of this Agreement;

         (c)      a certified  copy of a  resolution  of the  directors  of AUGI
                  dated as of the Closing Date  appointing the nominees of Kraft
                  as officers of Kraft and  appointing  the nominee of the Kraft
                  Shareholders to the board of directors of AUGI;

         (d)      an  acknowledgement  from  AUGI  of  the  satisfaction  of the
                  conditions precedent set forth in section 7.1 hereof;

         (e)      certificate or incorporation and good standing  certificate of
                  AUGI; and

         (f)      such other  documents as Kraft may reasonably  require to give
                  effect to the terms and intention of this Agreement.

                                  ARTICLE 10
                             POST-CLOSING MATTERS

         Forthwith after the Closing, AUGI, Kraft and the Kraft Shareholders, as
the case may be,  agree to use all  their  best  efforts  to:

         (a)      issue a news release reporting the Closing;

         (b)      file a Form 8-K with the  Securities  and Exchange  Commission
                  disclosing  the terms of this  Agreement  within 4 days of the
                  Closing and, not more than 71 days following the filing of the
                  Form 8-K, file an amended Form 8-K which  includes the audited
                  financial  statements of Kraft as well as pro forma  financial
                  information  of  Kraft  and  AUGI as  required  by Item 310 of
                  Regulation SB as  promulgated  by the  Securities and Exchange
                  Commission;

         (c)      file  reports  on  Forms  13D and 3 with  the  Securities  and
                  Exchange   Commission   disclosing  the   acquisition  of  the
                  Acquisition Shares by the Kraft Shareholders;

         (d)      prepare and deliver the Kraft Financial Statements;

         (e)      change  the name of AUGI to "Energy  Solutions,  Inc." of such
                  other name as  determined  by the Board of  Directors of AUGI;
                  and

         (f)      use its best efforts to enter into agreements with Terra Solar
                  for the  exclusive  licensing  rights  to market  Terra  Solar
                  technology in North America, South America , Europe and Africa
                  and to install Terra Solar technology and equipment.

<PAGE>
                                      -26-

                                  ARTICLE 11
                              GENERAL PROVISIONS

ARBITRATION

11.1 The  parties  hereto  shall  attempt to resolve any  dispute,  controversy,
difference or claim arising out of or relating to this  Agreement by negotiation
in good  faith.  If  such  good  negotiation  fails  to  resolve  such  dispute,
controversy,  difference  or claim  within  fifteen  (15)  days  after any party
delivers  to any other  party a notice of its  intent to submit  such  matter to
arbitration,  then any party to such dispute,  controversy,  difference or claim
may submit such matter to arbitration in the City of New York, New York.

NOTICE

11.2 Any notice required or permitted to be given by any party will be deemed to
be given when in writing and delivered to the address for notice of the intended
recipient by personal delivery,  prepaid single certified or registered mail, or
telecopier.  Any notice  delivered by mail shall be deemed to have been received
on the fourth  business day after and excluding  the date of mailing,  except in
the event of a disruption in regular  postal  service in which event such notice
shall be deemed to be  delivered  on the  actual  date of  receipt.  Any  notice
delivered  personally or by telecopier  shall be deemed to have been received on
the actual date of delivery.

ADDRESSES FOR SERVICE

11.3 The  address  for  service  of notice of each of the  parties  hereto is as
follows:

         (a)      AUGI:

                  American United Global, Inc.
                  108 Village Square, #327
                  Somers, NY 10589

                  Sichenzia Ross Friedman Ference LLP
                  1065 Avenue of the Americas
                  New York, New York 10018
                  Attn:  Richard A. Friedman, Esq.
                  Phone:  (212) 930-9700
                  Telecopier:  (212) 930-9725

         (b)      Kraft or the Kraft Shareholders:

                  Kraft Rt.
                  Konkoly Thege u. 29-33
                  Budapest H-1121
                  Hungary

<PAGE>
                                      -27-

CHANGE OF ADDRESS

11.4 Any party may, by notice to the other parties change its address for notice
to some other address in North America and will so change its address for notice
whenever  the existing  address or notice  ceases to be adequate for delivery by
hand. A post office box may not be used as an address for service.

FURTHER ASSURANCES

11.5 Each of the  parties  will  execute  and  deliver  such  further  and other
documents  and do and perform such further and other acts as any other party may
reasonably  require to carry out and give effect to the terms and  intention  of
this Agreement.

TIME OF THE ESSENCE

11.6    Time is expressly declared to be the essence of this Agreement.

ENTIRE AGREEMENT

11.7 The  provisions  contained  herein  constitute the entire  agreement  among
Kraft, the Kraft  Shareholders and AUGI respecting the subject matter hereof and
supersede all previous communications,  representations and agreements,  whether
verbal or written,  among Kraft, the Kraft Shareholders and AUGI with respect to
the subject matter hereof.

ENUREMENT

11.8 This Agreement will enure to the benefit of and be binding upon the parties
hereto and their respective  heirs,  executors,  administrators,  successors and
permitted assigns.

ASSIGNMENT

11.9 This Agreement is not assignable  without the prior written  consent of the
parties hereto.

COUNTERPARTS

11.10  This  Agreement  may be  executed  in  counterparts,  each of which  when
executed  by any  party  will be  deemed  to be an  original  and  all of  which
counterparts  will together  constitute one and the same Agreement.  Delivery of
executed copies of this Agreement by telecopier will constitute proper delivery,
provided  that  originally  executed  counterparts  are delivered to the parties
within a reasonable time thereafter.

APPLICABLE LAW

11.11 This Agreement is subject to the laws of the State of New York.

                [Remainder of page intentionally left blank.]

<PAGE>
                                      -28-

            IN  WITNESS   WHEREOF  the  parties  have  executed  this  Agreement
effective as of the day and year first above written.

AMERICAN UNITED GLOBAL, INC.

By: /s/Robert Rubin
     Robert Rubin, CEO

KRAFT RT.

By: /s/Zoltan Kiss
     Zoltan Kiss, Director

SHAREHOLDERS OF KRAFT RT.

/s/ Joel F. Spivak                              /s/Jacqueline Spivak
------------------                              --------------------
Joel F. Spivak                                  Jacqueline Spivak

<PAGE>
                                      -29-

SCHEDULE 2.2

NAME OF SHAREHOLDER     SHARES OF KRAFT   PREFERRED SHARES  SHARES OF AMERICAN
    OF KRAFT RT.           RT. OWNED         OF AMERICAN      UNITED GLOBAL,
                                           UNITED GLOBAL,    INC. TO BE ISSUED
                                                INC.        UPON CONVERSION OF
                                                            THE PREFERRED SHARE
--------------------------------------------------------------------------------
Joel F. Spivak                   50             1,000             350,000
--------------------------------------------------------------------------------
Jacqueline Spivak                50             1,000             350,000
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
                                100             2,000             700,000
--------------------------------------------------------------------------------EXHIBIT
      4.1

                           

    NEITHER
      THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS 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. THIS SECURITY
      AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY MAY BE PLEDGED IN
      CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH
      SECURITIES.

    

    SERIES
      A COMMON STOCK PURCHASE WARRANT

    

    To
      Purchase __________ Shares of Common Stock of

     

    INTERACTIVE
      TELEVISION NETWORKS, INC.

     

    THIS
      COMMON STOCK PURCHASE WARRANT (the “Warrant”)
      certifies that, for value received, _____________ (the “Holder”),
      is
      entitled, upon the terms and subject to the limitations on exercise and the
      conditions hereinafter set forth, at any time on or after the date hereof (the
      “Initial
      Exercise Date”)
      and on
      or prior to the close of business on the five year anniversary of the Initial
      Exercise Date (the “Termination
      Date”)
      but
      not thereafter, to subscribe for and purchase from Interactive Television
      Networks, Inc., a Nevada corporation (the “Company”),
      up to
      ______ shares (the “Warrant
      Shares”)
      of
      Common Stock, par value $.001 per share, of the Company (the “Common
      Stock”).
      The
      purchase price of one share of Common Stock under this Warrant shall be equal
      to
      the Exercise Price, as defined in Section 2(b). 

     

    Section
      1. Definitions.
      Capitalized terms used and not otherwise defined herein shall have the meanings
      set forth in that certain Securities Purchase Agreement (the “Purchase
      Agreement”),
      dated
      June 19, 2006, among the Company and the purchasers signatory
      thereto.

     

    Section
      2. Exercise.

     

    a)  Exercise
      of Warrant.
      Exercise of the purchase rights represented by this Warrant may be made, in
      whole or in part, at any time or times on or after the Initial Exercise Date
      and
      on or before the Termination Date by delivery to the Company of a duly executed
      facsimile copy of the Notice of Exercise Form annexed hereto (or such other
      office or agency of the Company as it may designate by notice in writing to
      the
      registered Holder at the address of such Holder appearing on the books of the
      Company); and, within 3 Trading Days of the date said Notice of Exercise is
      delivered to the Company, the Company shall have received payment of the
      aggregate Exercise Price of the shares thereby purchased by wire transfer or
      cashier’s check drawn on a United States bank. Notwithstanding anything herein
      to the contrary, the Holder shall not be required to physically surrender this
      Warrant to the Company until the Holder has purchased all of the Warrant Shares
      available hereunder and the Warrant has been exercised in full, in which case,
      the Holder shall surrender this Warrant to the Company for cancellation within
      3
      Trading Days of the date the final Notice of Exercise is delivered to the
      Company. Partial exercises of this Warrant resulting in purchases of a portion
      of the total number of Warrant Shares available hereunder shall have the effect
      of lowering the outstanding number of Warrant Shares purchasable hereunder
      in an
      amount equal to the applicable number of Warrant Shares purchased. The Holder
      and the Company shall maintain records showing the number of Warrant Shares
      purchased and the date of such purchases. The Company shall deliver any
      objection to any Notice of Exercise Form within 1 Business Day of receipt of
      such notice. In the event of any dispute or discrepancy, the records of the
      Holder shall be controlling and determinative in the absence of manifest error.
      The Holder and any assignee, by acceptance of this Warrant, acknowledge and
      agree that, by reason of the provisions of this paragraph, following the
      purchase of a portion of the Warrant Shares hereunder, the number of Warrant
      Shares available for purchase hereunder at any given time may be less than
      the
      amount stated on the face hereof.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    b)  Exercise
      Price.
      The
      exercise price per share of the Common Stock under this Warrant shall be
$3.00,
      subject
      to adjustment hereunder (the “Exercise
      Price”).

     

    c)  Cashless
      Exercise.
      If at
      any time after one year from the date of issuance of this Warrant there is
      no
      effective Registration Statement registering, or no current prospectus available
      for, the resale of the Warrant Shares by the Holder, then this Warrant may
      also
      be exercised at such time by means of a “cashless exercise” in which the Holder
      shall be entitled to receive a certificate for the number of Warrant Shares
      equal to the quotient obtained by dividing [(A-B) (X)] by (A),
      where:

     

    
      	 	
              (A)
                = the VWAP on the Trading Day immediately preceding the date of such
                election;

            

    

    

    
      	 	
              (B)
                = the Exercise Price of this Warrant, as adjusted; and
                

            

    

    

    
      	 	
              (X)
                = the number of Warrant Shares issuable upon exercise of this Warrant
                in
                accordance with the terms of this Warrant by means of a cash exercise
                rather 

                       
                than a cashless exercise.

            

    

     

    d)      
      Exercise
      Limitations.
      

     

    
      	i.  	
              Holder’s
                Restrictions.
                The Company shall not effect any exercise of this Warrant, and a
                Holder
                shall not have the right to exercise any portion of this Warrant,
                pursuant
                to Section 2(c) or otherwise, to the extent that after giving effect
                to
                such issuance after exercise as set forth on the applicable Notice
                of
                Exercise, such Holder (together with such Holder’s Affiliates, and any
                other person or entity acting as a group together with such Holder
                or any
                of such Holder’s Affiliates), as set forth on the applicable Notice of
                Exercise, would beneficially own in excess of the Beneficial Ownership
                Limitation (as defined below).  For purposes of the foregoing
                sentence, the number of shares of Common Stock beneficially owned
                by such
                Holder and its Affiliates shall include the number of shares of Common
                Stock issuable upon exercise of this Warrant with respect to which
                such
                determination is being made, but shall exclude the number of shares
                of
                Common Stock which would be issuable upon (A) exercise of the remaining,
                nonexercised portion of this Warrant beneficially owned by such Holder
                or
                any of its Affiliates and (B) exercise or conversion of the unexercised
                or
                nonconverted portion of any other securities of the Company (including,
                without limitation, any other Debentures or Warrants) subject to
                a
                limitation on conversion or exercise analogous to the limitation
                contained
                herein beneficially owned by such Holder or any of its affiliates. 
                Except as set forth in the preceding sentence, for purposes of this
                Section 2(d)(i), beneficial ownership shall be calculated in accordance
                with Section 13(d) of the Exchange Act and the rules and regulations
                promulgated thereunder, it being acknowledged by a Holder that the
                Company
                is not representing to such Holder that such calculation is in compliance
                with Section 13(d) of the Exchange Act and such Holder is solely
                responsible for any schedules required to be filed in accordance
                therewith. To the extent that the limitation contained in this Section
                2(d) applies, the determination of whether this Warrant is exercisable
                (in
                relation to other securities owned by such Holder together with any
                Affiliates) and of which a portion of this Warrant is exercisable
                shall be
                in the sole discretion of a Holder, and the submission of a Notice
                of
                Exercise shall be deemed to be each Holder’s determination of whether this
                Warrant is exercisable (in relation to other securities owned by
                such
                Holder together with any Affiliates) and of which portion of this
                Warrant
                is exercisable, in each case subject to such aggregate percentage
                limitation, and the Company shall have no obligation to verify or
                confirm
                the accuracy of such determination. In addition, a determination
                as to any
                group status as contemplated above shall be determined in accordance
                with
                Section 13(d) of the Exchange Act and the rules and regulations
                promulgated thereunder. For purposes of this Section 2(d), in determining
                the number of outstanding shares of Common Stock, a Holder may rely
                on the
                number of outstanding shares of Common Stock as reflected in (x)
                the
                Company’s most recent Form 10-QSB or Form 10-KSB, as the case may be, (y)
                a more recent public announcement by the Company or (z) any other
                notice
                by the Company or the Company’s Transfer Agent setting forth the number of
                shares of Common Stock outstanding.  Upon the written or oral request
                of a Holder, the Company shall within two Trading Days confirm orally
                and
                in writing to such Holder the number of shares of Common Stock then
                outstanding.  In any case, the number of outstanding shares of Common
                Stock shall be determined after giving effect to the conversion or
                exercise of securities of the Company, including this Warrant, by
                such
                Holder or its Affiliates since the date as of which such number of
                outstanding shares of Common Stock was reported. The “Beneficial Ownership
                Limitation” shall be 4.99% of the number of shares of the Common Stock
                outstanding immediately after giving effect to the issuance of shares
                of
                Common Stock issuable upon exercise of this Warrant. The Beneficial
                Ownership Limitation provisions of this Section 2(d)(i) may be waived
                by
                such Holder, at the election of such Holder, upon not less than 61
                days’
                prior notice to the Company to change the Beneficial Ownership Limitation
                to 9.99% of the number of shares of the Common Stock outstanding
                immediately after giving effect to the issuance of shares of Common
                Stock
                upon exercise of this Warrant, and the provisions of this Section
                2(d)
                shall continue to apply. Upon such a change by a Holder of the Beneficial
                Ownership Limitation from such 4.99% limitation to such 9.99% limitation,
                the Beneficial Ownership Limitation may not be further waived by
                such
                Holder. The provisions of this paragraph shall be construed and
                implemented in a manner otherwise than in strict conformity with
                the terms
                of this Section 2(d)(i) to correct this paragraph (or any portion
                hereof)
                which may be defective or inconsistent with the intended Beneficial
                Ownership Limitation herein contained or to make changes or supplements
                necessary or desirable to properly give effect to such limitation.
                The
                limitations contained in this paragraph shall apply to a successor
                holder
                of this Warrant.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    e)  Mechanics
      of Exercise.
      

     

    i.  Authorization
      of Warrant Shares.
      The
      Company covenants that all Warrant Shares which may be issued upon the exercise
      of the purchase rights represented by this Warrant will, upon exercise of the
      purchase rights represented by this Warrant, be duly authorized, validly issued,
      fully paid and nonassessable and free from all taxes, liens and charges created
      by the Company in respect of the issue thereof (other than taxes in respect
      of
      any transfer occurring contemporaneously with such issue). 

     

    ii.  Delivery
      of Certificates Upon Exercise.
      Certificates for shares purchased hereunder shall be transmitted by the transfer
      agent of the Company to the Holder by crediting the account of the Holder’s
      prime broker with the Depository Trust Company through its Deposit Withdrawal
      Agent Commission (“DWAC”)
      system
      if the Company is a participant in such system, and otherwise by physical
      delivery to the address specified by the Holder in the Notice of Exercise within
      3 Trading Days from the delivery to the Company of the Notice of Exercise Form,
      surrender of this Warrant (if required) and payment of the aggregate Exercise
      Price as set forth above (“Warrant
      Share Delivery Date”).
      This
      Warrant shall be deemed to have been exercised on the date the Exercise Price
      is
      received by the Company. The Warrant Shares shall be deemed to have been issued,
      and Holder or any other person so designated to be named therein shall be deemed
      to have become a holder of record of such shares for all purposes, as of the
      date the Warrant has been exercised by payment to the Company of the Exercise
      Price (or by cashless exercise, if permitted) and all taxes required to be
      paid
      by the Holder, if any, pursuant to Section 2(e)(vii) prior to the issuance
      of
      such shares, have been paid. 

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    iii.  Delivery
      of New Warrants Upon Exercise.
      If this
      Warrant shall have been exercised in part, the Company shall, at the request
      of
      a Holder and upon surrender of this Warrant certificate, at the time of delivery
      of the certificate or certificates representing Warrant Shares, deliver to
      Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased
      Warrant Shares called for by this Warrant, which new Warrant shall in all other
      respects be identical with this Warrant.

     

    iv.  Rescission
      Rights.
      If the
      Company fails to cause its transfer agent to transmit to the Holder a
      certificate or certificates representing the Warrant Shares pursuant to this
      Section 2(e)(iv) by the Warrant Share Delivery Date, then the Holder will have
      the right to rescind such exercise.

     

    v.  Compensation
      for Buy-In on Failure to Timely Deliver Certificates Upon
      Exercise.
      In
      addition to any other rights available to the Holder, if the Company fails
      to
      cause its transfer agent to transmit to the Holder a certificate or certificates
      representing the Warrant Shares pursuant to an exercise on or before the Warrant
      Share Delivery Date, and if after such date the Holder is required by its broker
      to purchase (in an open market transaction or otherwise) shares of Common Stock
      to deliver in satisfaction of a sale by the Holder of the Warrant Shares which
      the Holder anticipated receiving upon such exercise (a “Buy-In”),
      then
      the Company shall (1) pay in cash to the Holder the amount by which (x) the
      Holder’s total purchase price (including brokerage commissions, if any) for the
      shares of Common Stock so purchased exceeds (y) the amount obtained by
      multiplying (A) the number of Warrant Shares that the Company was required
      to
      deliver to the Holder in connection with the exercise at issue times (B) the
      price at which the sell order giving rise to such purchase obligation was
      executed, and (2) at the option of the Holder, either reinstate the portion
      of
      the Warrant and equivalent number of Warrant Shares for which such exercise
      was
      not honored or deliver to the Holder the number of shares of Common Stock that
      would have been issued had the Company timely complied with its exercise and
      delivery obligations hereunder. For example, if the Holder purchases Common
      Stock having a total purchase price of $11,000 to cover a Buy-In with respect
      to
      an attempted exercise of shares of Common Stock with an aggregate sale price
      giving rise to such purchase obligation of $10,000, under clause (1) of the
      immediately preceding sentence the Company shall be required to pay the Holder
      $1,000. The Holder shall provide the Company written notice indicating the
      amounts payable to the Holder in respect of the Buy-In and, upon request of
      the
      Company, evidence of the amount of such loss. Nothing herein shall limit a
      Holder’s right to pursue any other remedies available to it hereunder, at law or
      in equity including, without limitation, a decree of specific performance and/or
      injunctive relief with respect to the Company’s failure to timely deliver
      certificates representing shares of Common Stock upon exercise of the Warrant
      as
      required pursuant to the terms hereof.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    vi.  No
      Fractional Shares or Scrip.
      No
      fractional shares or scrip representing fractional shares shall be issued upon
      the exercise of this Warrant. As to any fraction of a share which Holder would
      otherwise be entitled to purchase upon such exercise, the Company shall at
      its
      election, either pay a cash adjustment in respect of such final fraction in
      an
      amount equal to such fraction multiplied by the Exercise Price or round up
      to
      the next whole share.

     

    vii.  Charges,
      Taxes and Expenses.
      Issuance of certificates for Warrant Shares shall be made without charge to
      the
      Holder for any issue or transfer tax or other incidental expense in respect
      of
      the issuance of such certificate, all of which taxes and expenses shall be
      paid
      by the Company, and such certificates shall be issued in the name of the Holder
      or in such name or names as may be directed by the Holder; provided,
      however,
      that in
      the event certificates for Warrant Shares are to be issued in a name other
      than
      the name of the Holder, this Warrant when surrendered for exercise shall be
      accompanied by the Assignment Form attached hereto duly executed by the Holder;
      and the Company may require, as a condition thereto, the payment of a sum
      sufficient to reimburse it for any transfer tax incidental thereto.

     

    viii.  Closing
      of Books.
      The
      Company will not close its stockholder books or records in any manner which
      prevents the timely exercise of this Warrant, pursuant to the terms
      hereof.

     

    Section
      3. Certain Adjustments.

     

    a)  Stock
      Dividends and Splits.
      If the
      Company, at any time while this Warrant is outstanding: (A) pays a stock
      dividend or otherwise make a distribution or distributions on shares of its
      Common Stock or any other equity or equity equivalent securities payable in
      shares of Common Stock (which, for avoidance of doubt, shall not include any
      shares of Common Stock issued by the Company upon exercise of this Warrant),
      (B)
      subdivides outstanding shares of Common Stock into a larger number of shares,
      (C) combines (including by way of reverse stock split) outstanding shares of
      Common Stock into a smaller number of shares, or (D) issues by reclassification
      of shares of the Common Stock any shares of capital stock of the Company, then
      in each case the Exercise Price shall be multiplied by a fraction of which
      the
      numerator shall be the number of shares of Common Stock (excluding treasury
      shares, if any) outstanding immediately before such event and of which the
      denominator shall be the number of shares of Common Stock outstanding
      immediately after such event and the number of shares issuable upon exercise
      of
      this Warrant shall be proportionately adjusted. Any adjustment made pursuant
      to
      this Section 3(a) shall become effective immediately after the record date
      for
      the determination of stockholders entitled to receive such dividend or
      distribution and shall become effective immediately after the effective date
      in
      the case of a subdivision, combination or re-classification.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    b)  Subsequent
      Equity Sales.
      If the
      Company or any Subsidiary thereof, as applicable, at any time while this Warrant
      is outstanding, shall sell or grant any option to purchase or sell or grant
      any
      right to reprice its securities, or otherwise dispose of or issue (or announce
      any offer, sale, grant or any option to purchase or other disposition) any
      Common Stock or Common Stock Equivalents entitling any Person to acquire shares
      of Common Stock, at an effective price per share less than the then Exercise
      Price (such lower price, the “Base
      Share Price”
and
      such issuances collectively, a “Dilutive
      Issuance”)
      (if
      the holder of the Common Stock or Common Stock Equivalents so issued shall
      at
      any time, whether by operation of purchase price adjustments, reset provisions,
      floating conversion, exercise or exchange prices or otherwise, or due to
      warrants, options or rights per share which are issued in connection with such
      issuance, be entitled to receive shares of Common Stock at an effective price
      per share which is less than the Exercise Price, such issuance shall be deemed
      to have occurred for less than the Exercise Price on such date of the Dilutive
      Issuance), then the Exercise Price shall be reduced and only reduced by
      multiplying the Exercise Price by a fraction, the numerator of which is the
      number of shares of Common Stock issued and outstanding immediately prior to
      the
      Dilutive Issuance plus the number of shares of Common Stock which the offering
      price for such Dilutive Issuance would purchase at the then Exercise Price,
      and
      the denominator of which shall be the sum of the number of shares of Common
      Stock issued and outstanding immediately prior to the Dilutive Issuance plus
      the
      number of shares of Common Stock so issued or issuable in connection with the
      Dilutive Issuance, and the number of Warrant Shares issuable hereunder shall
      be
      increased such that the aggregate Exercise Price payable hereunder, after taking
      into account the decrease in the Exercise Price, shall be equal to the aggregate
      Exercise Price prior to such adjustment. Such adjustment shall be made whenever
      such Common Stock or Common Stock Equivalents are issued. Notwithstanding the
      foregoing, no adjustments shall be made, paid or issued under this Section
      3(b)
      in respect of an Exempt Issuance. The Company shall notify the Holder in
      writing, no later than the Trading Day following the issuance of any Common
      Stock or Common Stock Equivalents subject to this section, indicating therein
      the applicable issuance price, or applicable reset price, exchange price,
      conversion price and other pricing terms (such notice the “Dilutive
      Issuance Notice”).
      For
      purposes of clarification, whether or not the Company provides a Dilutive
      Issuance Notice pursuant to this Section 3(b), upon the occurrence of any
      Dilutive Issuance, after the date of such Dilutive Issuance the Holder is
      entitled to receive a number of Warrant Shares based upon the Base Share Price
      regardless of whether the Holder accurately refers to the Base Share Price
      in
      the Notice of Exercise.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    c)  Subsequent
      Rights Offerings.
      If the
      Company, at any time while the Warrant is outstanding, shall issue rights,
      options or warrants to all holders of Common Stock (and not to Holders)
      entitling them to subscribe for or purchase shares of Common Stock at a price
      per share less than the VWAP at the record date mentioned below, then the
      Exercise Price shall be multiplied by a fraction, of which the denominator
      shall
      be the number of shares of the Common Stock outstanding on the date of issuance
      of such rights or warrants plus the number of additional shares of Common Stock
      offered for subscription or purchase, and of which the numerator shall be the
      number of shares of the Common Stock outstanding on the date of issuance of
      such
      rights or warrants plus the number of shares which the aggregate offering price
      of the total number of shares so offered (assuming receipt by the Company in
      full of all consideration payable upon exercise of such rights, options or
      warrants) would purchase at such VWAP. Such adjustment shall be made whenever
      such rights or warrants are issued, and shall become effective immediately
      after
      the record date for the determination of stockholders entitled to receive such
      rights, options or warrants. 

     

    d)  Pro
      Rata Distributions.
      If the
      Company, at any time prior to the Termination Date, shall distribute to all
      holders of Common Stock (and not to Holders of the Warrants) evidences of its
      indebtedness or assets (including cash and cash dividends) or rights or warrants
      to subscribe for or purchase any security other than the Common Stock (which
      shall be subject to Section 3(b)), then in each such case the Exercise Price
      shall be adjusted by multiplying the Exercise Price in effect immediately prior
      to the record date fixed for determination of stockholders entitled to receive
      such distribution by a fraction of which the denominator shall be the VWAP
      determined as of the record date mentioned above, and of which the numerator
      shall be such VWAP on such record date less the then per share fair market
      value
      at such record date of the portion of such assets or evidence of indebtedness
      so
      distributed applicable to one outstanding share of the Common Stock as
      determined by the Board of Directors in good faith. In either case the
      adjustments shall be described in a statement provided to the Holder of the
      portion of assets or evidences of indebtedness so distributed or such
      subscription rights applicable to one share of Common Stock. Such adjustment
      shall be made whenever any such distribution is made and shall become effective
      immediately after the record date mentioned above.

     

    e)  Fundamental
      Transaction.
      If, at
      any time while this Warrant is outstanding, (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
      (in any such case, a “Fundamental
      Transaction”),
      then,
      upon any subsequent exercise of this Warrant, the Holder shall have the right
      to
      receive, for each Warrant Share that would have been issuable upon such exercise
      immediately prior to the occurrence of such Fundamental Transaction, at the
      option of the Holder, (a) upon exercise of this Warrant, the number of shares
      of
      Common Stock of the successor or acquiring corporation or of the Company, if
      it
      is the surviving corporation, and any additional consideration (the
“Alternate
      Consideration”)
      receivable upon or as a result of such reorganization, reclassification, merger,
      consolidation or disposition of assets by a Holder of the number of shares
      of
      Common Stock for which this Warrant is exercisable immediately prior to such
      event or (b) if the Company is acquired in an all cash transaction, cash equal
      to the value of this Warrant as determined in accordance with the Black-Scholes
      option pricing formula. For purposes of any such exercise, the determination
      of
      the Exercise Price shall be appropriately adjusted to apply to such Alternate
      Consideration based on the amount of Alternate Consideration issuable in respect
      of one share of Common Stock in such Fundamental Transaction, and the Company
      shall apportion the Exercise Price among the Alternate Consideration in a
      reasonable manner reflecting the relative value of any different components
      of
      the Alternate Consideration. If holders of Common Stock are given any choice
      as
      to the securities, cash or property to be received in a Fundamental Transaction,
      then the Holder shall be given the same choice as to the Alternate Consideration
      it receives upon any exercise of this Warrant following such Fundamental
      Transaction. To the extent necessary to effectuate the foregoing provisions,
      any
      successor to the Company or surviving entity in such Fundamental Transaction
      shall issue to the Holder a new warrant consistent with the foregoing provisions
      and evidencing the Holder’s right to exercise such warrant into Alternate
      Consideration. The terms of any agreement pursuant to which a Fundamental
      Transaction is effected shall include terms requiring any such successor or
      surviving entity to comply with the provisions of this Section 3(e) and insuring
      that this Warrant (or any such replacement security) will be similarly adjusted
      upon any subsequent transaction analogous to a Fundamental
      Transaction.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    f)  Calculations.
      All
      calculations under this Section 3 shall be made to the nearest cent or the
      nearest 1/100th of a share, as the case may be. For purposes of this Section
      3,
      the number of shares of Common Stock deemed to be issued and outstanding as
      of a
      given date shall be the sum of the number of shares of Common Stock (excluding
      treasury shares, if any) issued and outstanding.

     

    g)  Voluntary
      Adjustment By Company.
      The
      Company may at any time during the term of this Warrant reduce the then current
      Exercise Price to any amount and for any period of time deemed appropriate
      by
      the Board of Directors of the Company.

     

    h)  Notice
      to Holders.
      

     

    i.  Adjustment
      to Exercise Price.
      Whenever the Exercise Price is adjusted pursuant to any provision of this
      Section 3, the Company shall promptly mail to each Holder a notice setting
      forth
      the Exercise Price after such adjustment and setting forth a brief statement
      of
      the facts requiring such adjustment. If the Company issues a variable rate
      security, despite the prohibition thereon in the Purchase Agreement, the Company
      shall be deemed to have issued Common Stock or Common Stock Equivalents at
      the
      lowest possible conversion or exercise price at which such securities may be
      converted or exercised in the case of a Variable Rate Transaction (as defined
      in
      the Purchase Agreement).

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    ii.  Notice
      to Allow Exercise by Holder.
      If (A)
      the Company shall declare a dividend (or any other distribution in whatever
      form) on the Common Stock; (B) the Company shall declare a special nonrecurring
      cash dividend on or a redemption of the Common Stock; (C) the Company shall
      authorize the granting to all holders of the Common Stock rights or warrants
      to
      subscribe for or purchase any shares of capital stock of any class or of any
      rights; (D) the approval of any stockholders of the Company shall be required
      in
      connection with any reclassification of the Common Stock, any consolidation
      or
      merger to which the Company is a party, any sale or transfer of all or
      substantially all of the assets of the Company, of any compulsory share exchange
      whereby the Common Stock is converted into other securities, cash or property;
      (E) the Company shall authorize the voluntary or involuntary dissolution,
      liquidation or winding up of the affairs of the Company; then, in each case,
      the
      Company shall cause to be mailed to the Holder at its last address as it shall
      appear upon the Warrant Register of the Company, at least 20 calendar days
      prior
      to the applicable record or effective date hereinafter specified, a notice
      stating (x) the date on which a record is to be taken for the purpose of such
      dividend, distribution, redemption, rights or warrants, or if a record is not
      to
      be taken, the date as of which the holders of the Common Stock of record to
      be
      entitled to such dividend, distributions, redemption, rights or warrants are
      to
      be determined or (y) the date on which such reclassification, consolidation,
      merger, sale, transfer or share exchange is expected to become effective or
      close, and the date as of which it is expected that holders of the Common Stock
      of record shall be entitled to exchange their shares of the Common Stock for
      securities, cash or other property deliverable upon such reclassification,
      consolidation, merger, sale, transfer or share exchange; provided that the
      failure to mail such notice or any defect therein or in the mailing thereof
      shall not affect the validity of the corporate action required to be specified
      in such notice. The Holder is entitled to exercise this Warrant during the
      20-day period commencing on the date of such notice to the effective date of
      the
      event triggering such notice.

     

    Section
      4. Transfer
      of Warrant.

     

    a)  Transferability.
      Subject
      to compliance with any applicable securities laws and the conditions set forth
      in Section 4(d) hereof and to the provisions of Section 4.1 of the Purchase
      Agreement, this Warrant and all rights hereunder (including, without limitation,
      any registration rights) are transferable, in whole or in part, upon surrender
      of this Warrant at the principal office of the Company or its designated agent,
      together with a written assignment of this Warrant substantially in the form
      attached hereto duly executed by the Holder or its agent or attorney and funds
      sufficient to pay any transfer taxes payable upon the making of such transfer.
      Upon such surrender and, if required, such payment, the Company shall execute
      and deliver a new Warrant or Warrants in the name of the assignee or assignees
      and in the denomination or denominations specified in such instrument of
      assignment, and shall issue to the assignor a new Warrant evidencing the portion
      of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
      A
      Warrant, if properly assigned, may be exercised by a new holder for the purchase
      of Warrant Shares without having a new Warrant issued. 

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    b)  New
      Warrants.
      This
      Warrant may be divided or combined with other Warrants upon presentation hereof
      at the aforesaid office of the Company, together with a written notice
      specifying the names and denominations in which new Warrants are to be issued,
      signed by the Holder or its agent or attorney. Subject to compliance with
      Section 4(a), as to any transfer which may be involved in such division or
      combination, the Company shall execute and deliver a new Warrant or Warrants
      in
      exchange for the Warrant or Warrants to be divided or combined in accordance
      with such notice.

     

    c)  Warrant
      Register.
      The
      Company shall register this Warrant, upon records to be maintained by the
      Company for that purpose (the “Warrant
      Register”),
      in
      the name of the record Holder hereof from time to time. The Company may deem
      and
      treat the registered Holder of this Warrant as the absolute owner hereof for
      the
      purpose of any exercise hereof or any distribution to the Holder, and for all
      other purposes, absent actual notice to the contrary.

     

    d)  Transfer
      Restrictions.
      If,
      at the
time
      of
      the surrender of this Warrant in connection with any transfer of this Warrant,
      the transfer of this Warrant shall not be registered pursuant to an effective
      registration
      statement under the Securities Act
      and
under
      applicable state securities or blue sky laws, the Company may require, as a
      condition of allowing such transfer (i) that the Holder or transferee of this
      Warrant, as the case may be, furnish to the Company a written opinion of counsel
      (which opinion shall be in form, substance and scope customary for opinions
      of
      counsel in comparable transactions) to the effect that such transfer may be
      made
      without
      registration under
      the
      Securities Act and under applicable state securities or blue sky laws, (ii)
      that
      the holder or transferee execute and deliver to the Company an investment letter
      in form and substance acceptable to the Company and (iii) that the transferee
      be
      an “accredited
      investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7), or (a)(8)
      promulgated under the Securities Act or a “qualified institutional buyer” as
      defined in Rule 144A(a) under the Securities Act.

     

    Section
      5. Miscellaneous.

     

    a)  No
      Rights as Shareholder Until Exercise.
      This
      Warrant does not entitle the Holder to any voting rights or other rights as
      a
      shareholder of the Company prior to the exercise hereof as set forth in Section
      2(e)(ii). 

     

    b)  Loss,
      Theft, Destruction or Mutilation of Warrant.
      The
      Company covenants that upon receipt by the Company of evidence reasonably
      satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
      or any stock certificate relating to the Warrant Shares, and in case of loss,
      theft or destruction, of indemnity or security reasonably satisfactory to it
      (which, in the case of the Warrant, shall not include the posting of any bond),
      and upon surrender and cancellation of such Warrant or stock certificate, if
      mutilated, the Company will make and deliver a new Warrant or stock certificate
      of like tenor and dated as of such cancellation, in lieu of such Warrant or
      stock certificate.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    c)  Saturdays,
      Sundays, Holidays, etc.
      If the
      last or appointed day for the taking of any action or the expiration of any
      right required or granted herein shall not be a Business Day, then such action
      may be taken or such right may be exercised on the next succeeding Business
      Day.

     

    d)  Authorized
      Shares.
      

     

    The
      Company covenants that during the period the Warrant is outstanding, it will
      reserve from its authorized and unissued Common Stock a sufficient number of
      shares to provide for the issuance of the Warrant Shares upon the exercise
      of
      any purchase rights under this Warrant. The Company further covenants that
      its
      issuance of this Warrant shall constitute full authority to its officers who
      are
      charged with the duty of executing stock certificates to execute and issue
      the
      necessary certificates for the Warrant Shares upon the exercise of the purchase
      rights under this Warrant. The Company will take all such reasonable action
      as
      may be necessary to assure that such Warrant Shares may be issued as provided
      herein without violation of any applicable law or regulation, or of any
      requirements of the Trading Market upon which the Common Stock may be listed.
      

     

    Except
      and to the extent as waived or consented to by the Holder, the Company shall
      not
      by any action, including, without limitation, amending its certificate of
      incorporation or through any reorganization, transfer of assets, consolidation,
      merger, dissolution, issue or sale of securities or any other voluntary action,
      avoid or seek to avoid the observance or performance of any of the terms of
      this
      Warrant, but will at all times in good faith assist in the carrying out of
      all
      such terms and in the taking of all such actions as may be necessary or
      appropriate to protect the rights of Holder as set forth in this Warrant against
      impairment. Without limiting the generality of the foregoing, the Company will
      (a) not increase the par value of any Warrant Shares above the amount payable
      therefor upon such exercise immediately prior to such increase in par value,
      (b)
      take all such action as may be necessary or appropriate in order that the
      Company may validly and legally issue fully paid and nonassessable Warrant
      Shares upon the exercise of this Warrant, and (c) use commercially reasonable
      efforts to obtain all such authorizations, exemptions or consents from any
      public regulatory body having jurisdiction thereof as may be necessary to enable
      the Company to perform its obligations under this Warrant.

     

    Before
      taking any action which would result in an adjustment in the number of Warrant
      Shares for which this Warrant is exercisable or in the Exercise Price, the
      Company shall obtain all such authorizations or exemptions thereof, or consents
      thereto, as may be necessary from any public regulatory body or bodies having
      jurisdiction thereof.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    e)  Jurisdiction.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Warrant shall be determined in accordance with the provisions of the
      Purchase Agreement.

     

    f)  Restrictions.
      The
      Holder acknowledges that the Warrant Shares acquired upon the exercise of this
      Warrant, if not registered, will have restrictions upon resale imposed by state
      and federal securities laws.

     

    g)  Nonwaiver
      and Expenses.
      No
      course of dealing or any delay or failure to exercise any right hereunder on
      the
      part of Holder shall operate as a waiver of such right or otherwise prejudice
      Holder’s rights, powers or remedies, notwithstanding the fact that all rights
      hereunder terminate on the Termination Date. If the Company willfully and
      knowingly fails to comply with any provision of this Warrant, which results
      in
      any material damages to the Holder, the Company shall pay to Holder such amounts
      as shall be sufficient to cover any costs and expenses including, but not
      limited to, reasonable attorneys’ fees, including those of appellate
      proceedings, incurred by Holder in collecting any amounts due pursuant hereto
      or
      in otherwise enforcing any of its rights, powers or remedies
      hereunder.

     

    h)  Notices.
      Any
      notice, request or other document required or permitted to be given or delivered
      to the Holder by the Company shall be delivered in accordance with the notice
      provisions of the Purchase Agreement.

     

    i)  Limitation
      of Liability.
      No
      provision hereof, in the absence of any affirmative action by Holder to exercise
      this Warrant to purchase Warrant Shares, and no enumeration herein of the rights
      or privileges of Holder, shall give rise to any liability of Holder for the
      purchase price of any Common Stock or as a stockholder of the Company, whether
      such liability is asserted by the Company or by creditors of the
      Company.

     

    j)  Remedies.
      Holder,
      in addition to being entitled to exercise all rights granted by law, including
      recovery of damages, will be entitled to specific performance of its rights
      under this Warrant. The Company agrees that monetary damages would not be
      adequate compensation for any loss incurred by reason of a breach by it of
      the
      provisions of this Warrant and hereby agrees to waive and not to assert the
      defense in any action for specific performance that a remedy at law would be
      adequate.

     

    k)  Successors
      and Assigns.
      Subject
      to applicable securities laws, this Warrant and the rights and obligations
      evidenced hereby shall inure to the benefit of and be binding upon the
      successors of the Company and the successors and permitted assigns of Holder.
      The provisions of this Warrant are intended to be for the benefit of all Holders
      from time to time of this Warrant and shall be enforceable by any such Holder
      or
      holder of Warrant Shares.

     

    l)  Amendment.
      This
      Warrant may be modified or amended or the provisions hereof waived with the
      written consent of the Company and the Holder.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    m)  Severability.
      Wherever possible, each provision of this Warrant shall be interpreted in such
      manner as to be effective and valid under applicable law, but if any provision
      of this Warrant shall be prohibited by or invalid under applicable law, such
      provision shall be ineffective to the extent of such prohibition or invalidity,
      without invalidating the remainder of such provisions or the remaining
      provisions of this Warrant.

     

    n)  Headings.
      The
      headings used in this Warrant are for the convenience of reference only and
      shall not, for any purpose, be deemed a part of this Warrant.

     

    ********************

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Company has caused this Warrant to be executed by its
      officer thereunto duly authorized.

     

    
      	Dated:
              __________
              ___, 2006	 	 
	 	INTERACTIVE TELEVISION NETWORKS,
              INC.
	 	 
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Name:

              Title:

            

    

     

    
      
        
        

        
        

      

      
        14

        
          

        

      

      
        
        

        
        

      

    

     

    NOTICE
      OF EXERCISE

    

    TO: INTERACTIVE
      TELEVISION NETWORKS, INC.

    

    (1)  The
      undersigned hereby elects to purchase ________ Warrant Shares of the Company
      pursuant to the terms of the attached Warrant (only if exercised in full),
      and
      tenders herewith payment of the exercise price in full, together with all
      applicable transfer taxes, if any.

     

    (2)  Payment
      shall take the form of (check applicable box):

     

    o
      in lawful money of the
      United States; or

     

    o
      [if permitted] the cancellation of such
      number of Warrant Shares as is necessary, in accordance with the formula set
      forth in subsection 2(c), to exercise this Warrant with respect to the maximum
      number of Warrant Shares purchasable pursuant to the cashless exercise procedure
      set forth in subsection 2(c).

     

    (3)  Please
      issue a certificate or certificates representing said Warrant Shares in the
      name
      of the undersigned or in such other name as is specified below:

     

    _______________________________

     

    The
      Warrant Shares shall be delivered to the following DWAC Account Number or by
      physical delivery of a certificate to:

    

    _______________________________

     

    _______________________________

     

    _______________________________

    

    (4)
      Accredited
      Investor.
      The
      undersigned is an “accredited investor” as defined in Regulation D promulgated
      under the Securities Act of 1933, as amended.

    

    [SIGNATURE
      OF HOLDER]

     

    
      Name of Investing  Entity:
        ____________________________________________________________________________

      Signature of Authorized Signatory of Investing
        Entity:_______________________________________________________

      Name of Authorized Signatory:
        _________________________________________________________________________

      Title of Authorized
        Signatory:__________________________________________________________________________

      Date:_____________________________________________________________________________________________

    

    
       

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ASSIGNMENT
      FORM

    

    (To
      assign the foregoing warrant, execute

    this
      form
      and supply required information. 

    Do
      not
      use this form to exercise the warrant.)

    

    FOR
      VALUE
      RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all
      rights evidenced thereby are hereby assigned to

     

    

    _______________________________________________
      whose address is

    

    _______________________________________________________________.

    

    

    

    _______________________________________________________________

    

    Dated:
      ______________, _______

     

    
      	Holder’s
              Signature: 	 	 
	 	 	 
	Holder’s
              Address:	 	 
	 	 	 
	 	 	 

    

     

    Signature
      Guaranteed: ___________________________________________

     

    NOTE:
      The
      signature to this Assignment Form must correspond with the name as it appears
      on
      the face of the Warrant, without alteration or enlargement or any change
      whatsoever, and must be guaranteed by a bank or trust company. Officers of
      corporations and those acting in a fiduciary or other representative capacity
      should file proper evidence of authority to assign the foregoing
      Warrant.

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