Document:

Unassociated Document

    EXHIBIT
      10.1

     

    SECURITIES
      PURCHASE AGREEMENT

     

    Securities
      Purchase Agreement dated as of November 13, 2006 (this “Agreement”)
      by and
      between GPS Industries, Inc., a Nevada corporation, with principal executive
      offices located at Suite 214, 5500 152nd Street. Surrey, British Columbia,
      Canada V35 S59 (the “Company”),
      and
      Great White Shark Enterprises, Inc., a Florida corporation (“GWSE”),
      and
      Leisurecorp LLC, a Dubai limited liability company (“Leisurecorp”)
      (GWSE
      and Leisurecorp are herein individually referred to as a “Buyer”
and
      collectively the “Buyers”).

     

    WHEREAS,
      Buyers desire to purchase from the Company, and the Company desires to issue
      and
      sell to Buyers, upon the terms and subject to the conditions of this Agreement,
      shares (the “Preferred Shares”) of the Company’s Series B Preferred Stock for an
      aggregate purchase price of $15,740,890; and

     

    WHEREAS,
      in partial consideration of Buyers agreeing to purchase the Preferred Shares
      hereunder, the Company shall issue five-year warrants, in the form attached
      hereto as Exhibit A, to purchase shares of the Company’s common stock (the
“Common
      Stock”)
      at an
      exercise price per share of $.122 (the “Warrants”).

     

    WHEREAS,
      concurrently with the execution of this Agreement, GWSE is making a short-term
      loan in the amount of $1,500,000 to the Company, and Leisurecorp is making
      a
      short-term loan in the amount of $5,000,000 to the Company, which loans are
      evidenced by those certain unsecured, promissory notes (each a “Promissory
      Note”),
      dated
      as of the date hereof, issued by the Company to each of GWSE and
      Leisurecorp.

     

    NOW,
      THEREFORE, in consideration of the premises and the mutual covenants contained
      herein, the parties hereto, intending to be legally bound, hereby agree as
      follows:

     

    I.

    PURCHASE
      AND SALE OF PREFERRED SHARES AND WARRANT

     

    A.  Transaction.
      Subject
      to the satisfaction of the conditions set forth in Articles VI and VII, at
      the
      Closing (as defined below), each Buyer hereby severally agrees to purchase
      from
      the Company, and the Company hereby agrees to issue and sell to such Buyer
      in a
      transaction exempt from the registration and prospectus delivery requirements
      of
      the Securities Act of 1933, as amended (the “Securities
      Act”),
      Preferred Shares and Warrants as follows: (i) Leisurecorp hereby agrees to
      purchase 1,000,000 Preferred Shares and Warrants to purchase 40,983,607 shares
      of Common Stock for a purchase price of $10,000,000; and (ii) GWSE agrees to
      purchase 300,000 Preferred Shares and the Warrants to purchase 12,295,082 shares
      of Common Stock for a purchase price of $3,000,000. In addition, concurrent
      with
      the Closing, and conditioned upon the Closing, GWSE agrees to convert $2,740,890
      of indebtedness currently owed to it by the Company into 274,089 shares of
      Preferred Stock and Warrants to purchase 6,606,497 shares of Common Stock.
      The
      Buyers hereby agree to fund their respective Promissory Notes.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    B.  Purchase
      Price; Form of Payment.
      At the
      closing of the purchase and sale of the Preferred Shares (the “Closing”),
      (a)
      the Company shall issue to GWSE 300,000 Preferred Shares and a Warrant to
      purchase 12,295,082 shares of Common Stock, and GWSE shall pay the $3,000,000
      purchase price for such securities by issuing a $1,500,000 wire transfer of
      immediately available funds to the account of the Company as notified by the
      Company and by canceling the entire balance (principal and all accrued interest)
      then outstanding and owed to GWSE on its $1,500,000 Promissory Note; and (b)
      the
      Company shall issue to Leisurecorp 1,000,000 Preferred Shares and a Warrant
      to
      purchase 40,983,607 shares of Common Stock, and Leisurecorp shall pay its
      $10,000,000 purchase price by issuing a $5,000,000 wire transfer of immediately
      available funds to the account of the Company as notified by the Company and
      by
      canceling the entire balance (principal and all accrued interest) then
      outstanding and owed to Leisurecorp on its $5,000,000 Promissory Note. In
      addition, at the Closing the Company shall issue to GWSE 274,089 Preferred
      Shares and Warrants to purchase 6,606,497 shares of Common Stock in exchange
      for
      the cancellation in full of the indebtedness listed on Exhibit F(1) having
      an
      aggregate unpaid balance of $2,740,890. The stock certificates representing
      the
      Preferred Shares and the Warrants shall be issued and delivered to Buyers or
      their designated depository as instructed by the Buyers (which shall have been
      duly authorized, issued and executed I/N/O, Buyer or, if the Company otherwise
      has been notified, I/N/O Buyer’s nominee).

     

    C.  Additional
      Investment Right.
      During
      the 120 calendar days following the date of the Closing, each Buyer, shall
      have
      the right to increase its investment, or make an additional investment in the
      Company by purchasing additional shares of Preferred Stock and Warrants (the
      “Additional
      Securities”)
      for
      cash on the same terms as set forth in Article I. B. above (for each $10 cash
      investment, the Buyers shall purchase one Preferred Share and a Warrant to
      purchase 40.983607 shares of Common Stock). GWSE shall have the right to
      increase its aggregate investment in the Preferred Shares and Warrants by
      $3,000,000, and Leisurecorp shall have the right to increase its aggregate
      investment in the Preferred Shares and Warrants by $10,000,000. Each Buyer
      shall
      have the right to assign (in whole or in part) its right to purchase Additional
      Securities under this Article I. C. to one or more of its affiliates or
      designees. In order to exercise the right to purchase Additional Securities,
      the
      Buyer and/or its designee shall deliver to the Company irrevocable written
      notice of its election to make an additional investment, which notice shall
      (i)
      be delivered at least two business days prior to the proposed purchase date,
      (ii) specify the amount of such additional investment, and (iii) if applicable,
      identify the affiliated persons or designated entities who will purchase the
      Additional Securities. If the right to purchase the Additional Securities is
      exercised before the Closing by a Buyer or its assignee/designee, this Agreement
      (and the Registration Rights Agreement) will be amended solely to reflect the
      increased amount of investment by such Buyer or the addition of the
      assignee/designee as an additional investor. In the event that the right to
      purchase Additional Securities under this Article I. C. is exercised by any
      Buyer or its assignee/designee after the Closing, such Buyer or
      assignee/designee shall, at the time of the purchase of the Additional
      Securities, execute a securities purchase agreement that is substantively
      identical to this Agreement, which securities purchase agreement shall only
      be
      changed from this Agreement to reflect the Closing and the transactions
      contemplated hereby. The parties to this Agreement hereby agree that at any
      closing of the purchase of Additional Securities held after the Closing by
      a
      Buyer’s assignee/designee, such assignee/designee shall also enter, and become a
      party to the Registration Rights Agreement entered into by the parties to this
      Agreement at the Closing. The closing of any additional investment shall occur
      on the proposed purchase date or as soon as possible thereafter and at a time
      satisfactory to the party purchasing the Additional Securities (each a “Second
      Closing”). At such Second Closing, the Buyer or its assignee shall pay the
      purchase price by wire transfer of immediately available funds to the account
      of
      the Company, and the Company shall deliver the Warrants and stock certificates
      representing the Preferred Shares purchased. As a condition to each Second
      Closing, the Company shall be required to provide a certificate dated as of
      the
      date of the Second Closing (the “Second Closing Date”) executed by its Chief
      Executive Officer certifying as to the matters set forth in paragraph D of
      Article VII but shall substitute “Second Closing Date” for “Closing Date”).

     

    
      
        
        

      

      
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    II.

    BUYER’S
      REPRESENTATIONS AND WARRANTIES

     

    Each
      Buyer severally represents and warrants to and covenants and agrees with the
      Company as follows:

     

    A.  Buyer
      is
      purchasing the Preferred Shares, the Common Stock issuable upon conversion
      of
      the Shares (the “Conversion
      Shares”),
      the
      Warrants and the Common Stock issuable upon exercise of the Warrants (the
“Warrant
      Shares”
and,
      collectively with the Preferred Shares, the Conversion Shares and the Warrants,
      the “Securities”),
      for
      its own account, for investment purposes only and not with a view towards or
      in
      connection with the public sale or distribution thereof in violation of the
      Securities Act.

     

    B.  Buyer
      is
      (i) an “accredited investor” within the meaning of Rule 501 of Regulation D
      under the Securities Act, (ii) experienced in making investments of the kind
      contemplated by this Agreement, (iii) capable, by reason of its business and
      financial experience, of evaluating the relative merits and risks of an
      investment in the Securities, and (iv) able to afford the loss of its investment
      in the Securities.

     

    C.  Buyer
      understands that the Securities are being offered and sold by the Company in
      reliance on an exemption from the registration requirements of the Securities
      Act and equivalent state securities and “blue sky” laws, and that the Company is
      relying upon the accuracy of, and Buyer’s compliance with, Buyer’s
      representations and warranties set forth in this Agreement to determine the
      availability of such exemption and the eligibility of Buyer to purchase the
      Securities;

     

    D.  Buyer
      understands that the Securities have not been approved or disapproved by the
      Securities and Exchange Commission (the “Commission”)
      or any
      state or provincial securities commission.

     

    E.  This
      Agreement has been duly and validly authorized, executed and delivered by Buyer
      and is a valid and binding agreement of Buyer enforceable against it in
      accordance with its terms, subject to applicable bankruptcy, insolvency,
      fraudulent conveyance, reorganization, moratorium and similar laws affecting
      creditors’ rights and remedies generally and except as rights to indemnity and
      contribution may be limited by federal or state securities laws or the public
      policy underlying such laws.

     

    F.  Since
      June 1, 2006, neither such Buyer nor any person over which such Buyer has
      control which (x) had knowledge of the transactions contemplated hereby, (y)
      has
      or shares discretion relating to such Buyer’s investments or trading or
      information concerning such Buyer’s investments, including in respect of the
      Securities, or (z) is subject to such Buyer’s review or input concerning such
      affiliate’s investments or trading (collectively, “Trading
      Affiliates”)
      has,
      directly or indirectly, effected or agreed to effect any short sale, whether
      or
      not against the box, established any “put equivalent position” (as defined in
      Rule 16a-1(h) under the Securities Exchange Act of 1934, as amended (the
“1934
      Act”))
      with
      respect to the Common Stock, granted any other right (including, without
      limitation, any put or call option) with respect to the Common Stock or with
      respect to any security that includes, relates to or derived any significant
      part of its value from the Common Stock or otherwise sought to hedge its
      position in the Common Stock. 

     

    
      
        
        

      

      
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    III.

    THE
      COMPANY’S REPRESENTATIONS

     

    The
      Company represents and warrants to Buyers that:

     

    A.  Organization
      and Qualification.
      The
      Company and each of its Subsidiaries (as defined below), if any, is a
      corporation duly organized, validly existing and in good standing under the
      laws
      of the jurisdiction in which it is incorporated, with full power and authority
      (corporate and other) to own, lease, use and operate its properties and to
      carry
      on its business as and where now owned, leased, used, operated and conducted.
      The Company and each of its Subsidiaries is duly qualified as a foreign
      corporation to do business and is in good standing in every jurisdiction in
      which its ownership or use of property or the nature of the business conducted
      by it makes such qualification necessary except where the failure to be so
      qualified or in good standing would not have a Material Adverse Effect.
“Material
      Adverse Effect”
means
      any of (i) a material and adverse effect on the legality, validity or
      enforceability of any document executed in connection with the transactions
      contemplated by this Agreement, the Warrants, the Registration Rights Agreement
      and the Shareholder Agreement to be entered into at the Closing by the Company
      and the Buyers (the foregoing documents are herein collectively referred to
      as
      the “Transaction
      Documents”),
      (ii)
      a material and adverse effect on the results of operations, assets, prospects,
      business or condition (financial or otherwise) of the Company and the
      Subsidiaries, taken as a whole, or (iii) an adverse impact on the Company’s
      ability to perform under any of the Transaction Documents. “Subsidiaries”
means
      any corporation or other organization, whether incorporated or unincorporated,
      in which the Company owns, directly or indirectly, any equity or other ownership
      interest.

     

    B.  Authorization;
      Enforcement.
      (i) The
      Company has all requisite corporate power and authority to enter into and
      perform this Agreement and the other Transaction Documents and to consummate
      the
      transactions contemplated hereby and thereby and to issue the Preferred Shares,
      the Warrants, the Conversion Shares, and the Warrant Shares, in accordance
      with
      the terms hereof and thereof, (ii) the execution and delivery of this Agreement
      and the other Transaction Documents by the Company and the consummation by
      it of
      the transactions contemplated hereby and thereby (including without limitation,
      the issuance of the Conversion Shares and the Warrant Shares) have been duly
      authorized by the Company’s Board of Directors and no further consent or
      authorization of the Company, its Board of Directors, its shareholders or any
      third party is required, (iii) this Agreement has been, and the other
      Transaction documents when executed, will be duly executed and delivered by
      the
      Company, and (iv) this Agreement constitutes, and upon execution and delivery
      by
      the Company of the other Transaction Documents, each of such instruments will
      constitute, a legal, valid and binding obligation of the Company enforceable
      against the Company in accordance with its terms.

     

    
      
        
        

      

      
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    C.  Capitalization.
      

     

    (i)  As
      of the
      date hereof, the authorized capital stock of the Company consists solely of
      (i)
      500,000,000 shares of Common Stock, of which 333,846,802 shares are issued
      and
      outstanding, 40 million shares are reserved for issuance pursuant to the
      Company’s stock option plans, of which options for the purchase of 23,190,000
      are outstanding, and 26,200,907 shares are reserved for issuance pursuant to
      securities exercisable for, or convertible into or exchangeable for shares
      of
      Common Stock (excluding the shares issuable under the NIR Group Notes); and
      (ii)
      50,000,000 shares of preferred stock (the “Preferred
      Stock”),
      of
      which no shares are outstanding but 15,000,000 shares have been designated
      “Series A Preferred Stock.” As of the date hereof, except as set forth in this
      paragraph and in Schedule C(i), there are no other securities exercisable for,
      or convertible into or exchangeable for shares of capital stock of the Company,
      and the Company has no contractual or other obligation to issue any shares
      of
      capital stock. The 375,000 shares of Series A Preferred Stock previously issued
      by the Company have been automatically converted into shares of Common Stock
      and
      are no longer outstanding. There are no other authorized shares of capital
      stock
      or voting securities. The Company currently has a sufficient number of
      authorized shares of Common Stock to cover all shares of Common Stock that
      are
      issuable as of the date of this Agreement if all currently issued and
      outstanding options, warrants and convertible or exchangeable securities were
      exercised, converted or exchanged on the date hereof.

     

    (ii)  Immediately
      after giving effect to the transactions contemplated by this Agreement
      (including the Amended Articles described in Article IV.H and the debt
      conversion referred to in Article VII.I), the authorized capital stock of the
      Company will consist of (i) 1,600,000,000 shares of Common Stock, of which
      a
      maximum of 376,533,966 shares will be issued and outstanding (assuming no
      exercise of currently outstanding options or warrants, a true and complete
      schedule of which is attached hereto as Schedule C(ii), and assuming that the
      Company debt obligations listed in Exhibit F as subject to conversion are
      converted prior to the Closing), 40 million shares will be reserved for issuance
      pursuant to the Company’s stock option plans, of which options for the purchase
      of 23,190,000 will be outstanding (assuming no exercise of currently outstanding
      options), and 446,074,765 shares will be reserved for issuance pursuant to
      then
      outstanding agreements or then outstanding securities exercisable for, or
      convertible into or exchangeable for shares of Common Stock; and 50,000,000
      shares of preferred stock, of which 15,000,000 shares have been designated
      Series A Preferred Stock (none of which will be outstanding), and 4,000,000
      shares have been designated “Series B Convertible Preferred Stock,” of which
      1,874,089 shares will be issued and outstanding. As of the Closing Date, except
      as set forth in this paragraph and on Schedule C(ii), there will be no other
      securities exercisable for, or convertible into or exchangeable for shares
      of
      Common Stock or Preferred Stock, the Company will have no contractual or other
      obligation to issue any shares of capital stock, and there will be no other
      authorized shares of capital stock or voting securities. 

     

    (iii)  
      All of
      the Company’s outstanding shares of capital stock are duly and validly issued,
      fully paid and nonassessable and were issued in compliance with state and
      federal securities laws and were not issued in violation of any preemptive
      or
      similar rights. 

     

    
      
        
        

      

      
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    (iv)  The
      Warrants and the Preferred Shares to be issued pursuant to this Agreement have
      been duly authorized and when issued in accordance with the terms of this
      Agreement will be fully paid and non-assessable and will be free and clear
      of
      any liens other than any liens created by the holder thereof, and will not
      be
      issued in violation of any preemptive or similar rights and will be issued
      in
      compliance with federal and state securities laws. At the Closing, the Common
      Stock issuable upon conversion of the Preferred Shares and exercise of the
      Warrants will be duly and validly, fully paid and non-assessable and will be
      free and clear of any liens other than any liens created by the holder thereof,
      and will not be issued in violation of any preemptive or similar rights and
      will
      be issued in compliance with federal and state securities laws. 

     

    (v)  The
      Company has issued options to purchase Common Stock and warrants exercisable
      for
      Common Stock on the terms and in the amounts set forth on Schedule C (the
“Convertible
      Securities”).
      Except for the Convertible Securities and except as otherwise set forth on
      Schedule C, there are no outstanding options, warrants, rights (including
      conversion or preemptive rights and other similar rights) or agreements, orally
      or in writing for the purchase or acquisition from the Company of any of its
      shares of capital stock.

     

    (vi)  The
      holders of Series B Preferred Shares will be entitled to the rights, preferences
      and privileges as set forth in the Certificate of Designation (as defined
      below). The Company has furnished to the Buyers true and correct copies of
      the
      Company's Articles of Incorporation as in effect on the date hereof
      ("Articles
      of Incorporation")
      and
      the Company's By-laws, as in effect on the date hereof (the "By-laws"),
      

     

    (vii)  Except
      for the Shareholder Agreement, the Company is not a party or subject to any
      agreement or understanding relating to the voting or giving of written consents
      with respect to any capital stock or by a director of the Company. 

     

    D.  Acknowledgment
      of Dilution.
      The
      Company understands and acknowledges the potentially dilutive effect to the
      Conversion Shares and Warrant Shares issuable upon conversion of the Preferred
      Shares or exercise of the Warrants. The Company further acknowledges that its
      obligation to issue the Conversion Shares and Warrant Shares in accordance
      with
      this Agreement, the Articles of Incorporation, the Certificate of Designation,
      and the Warrants is absolute and unconditional regardless of the dilutive effect
      that such issuance may have on the ownership interests of other shareholders
      of
      the Company. 

     

    E.  No
      Conflicts.
      The
      execution, delivery and performance of this Agreement and the other Transaction
      Documents by the Company and the consummation by the Company of the transactions
      contemplated hereby and thereby (including, without limitation, the issuance
      and
      reservation for issuance of the Conversion Shares and Warrant Shares) will
      not
      (i) conflict with or result in a violation of any provision of the Articles
      of
      Incorporation or By-laws or (ii) violate or conflict with, or result in a breach
      of any provision of, or constitute a default (or an event which with notice
      or
      lapse of time or both could become a default) under, or give to others any
      rights of termination, amendment, acceleration or cancellation of, any material
      agreement, indenture, patent, patent license or instrument to which the Company
      or any of its Subsidiaries is a party, or (iii) result in a violation of any
      law, rule, regulation, order, judgment or decree (including federal and state
      securities laws and regulations and regulations of any self-regulatory
      organizations to which the Company or its securities are subject) applicable
      to
      the Company or any of its Subsidiaries or by which any property or asset of
      the
      Company or any of its Subsidiaries is bound or affected. The businesses of
      the
      Company and its Subsidiaries, if any, are not being conducted, and shall not
      be
      conducted so long as a Buyer owns any of the Securities, in violation of any
      law, ordinance or regulation of any governmental entity. Neither the Company
      nor
      any of its Subsidiaries is in violation of its Certificate or Articles of
      Incorporation, By-laws or other organizational documents and neither the Company
      nor any of its Subsidiaries is in default under any material contract, agreement
      or understanding to which it is a party or by which it or its assets or
      properties is bound. 

     

    
      
        
        

      

      
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    F.  SEC
      Documents; Financial Statements.
      Since
      December 31, 2004 the Company has timely filed all reports, schedules, forms,
      statements and other documents required to be filed by it with the SEC pursuant
      to the reporting requirements of the 1934 Act (all of the foregoing and all
      exhibits included therein and financial statements and schedules thereto and
      documents incorporated by reference therein, being hereinafter referred to
      herein as the “SEC
      Documents”).
      As of
      their respective dates, the SEC Documents complied in all material respects
      with
      the requirements of the 1934 Act and the rules and regulations of the SEC
      promulgated thereunder applicable to the SEC Documents, and none of the SEC
      Documents, at the time they were filed with the SEC, contained any untrue
      statement of a material fact or omitted to state a material fact required to
      be
      stated therein or necessary in order to make the statements therein, in light
      of
      the circumstances under which they were made, not misleading. None of the
      statements made in any such SEC Documents is, or has been, required to be
      amended or updated under applicable law (except for such statements as have
      been
      amended or updated in subsequent filings prior the date hereof). As of their
      respective dates, the financial statements of the Company included in the SEC
      Documents, including the notes thereto (the “Financial
      Statements”),
      complied as to form in all material respects with applicable accounting
      requirements and the published rules and regulations of the SEC with respect
      thereto, were complete and correct in all material respects as of their
      respective dates, and were prepared in accordance with generally accepted
      accounting principles applied on a consistent basis throughout the periods
      indicated. The Financial Statements fairly present the consolidated financial
      condition and operating results of the Company at the dates and during the
      periods indicated therein (subject in the case of unaudited statements, to
      normal and recurring year-end adjustments) Except as set forth in the Financial
      Statements, the Company has no liabilities, contingent or otherwise, other
      than
      (i) liabilities incurred in the ordinary course of business subsequent to June
      30, 2006 and (ii) obligations under contracts and commitments incurred in the
      ordinary course of business and not required under generally accepted accounting
      principles to be reflected in such financial statements, which in the case
      of
      (i) or (ii), individually or in the aggregate, are not material to the financial
      condition or operating results of the Company. 

     

    G.  Absence
      of Certain Changes.
      Since
      December 31, 2005, there has been no material adverse change and no material
      adverse development in the assets, liabilities, business, properties,
      operations, financial condition, results of operations or prospects of the
      Company or any of its Subsidiaries.

     

    H.  Absence
      of Litigation.
      Except
      as set forth in the SEC Documents, there is no action, suit, claim, proceeding,
      inquiry, or investigation before or by any court, public board, government
      agency, self-regulatory organization or body pending or, to the knowledge of
      the
      Company or any of its Subsidiaries, threatened against or affecting the Company
      or any of its Subsidiaries, or their officers or directors in their capacity
      as
      such, that could have a Material Adverse Effect. There is no judgment, decree
      or
      order against the Company, or to the knowledge of the Company or any of its
      Subsidiaries, against its officers or directors (in their capacities as such)
      that could have a Material Adverse Effect.

     

    
      
        
        

      

      
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    I.  Tax
      Status.
      Except
      as set forth in Schedule H, the Company and each of its Subsidiaries has made
      or
      filed all federal, state, local and foreign income and all other tax returns,
      reports and declarations required by any jurisdiction to which it is subject
      (unless and only to the extent that the Company and each of its Subsidiaries
      has
      set aside on its books provisions reasonably adequate for the payment of all
      unpaid and unreported taxes) and has paid all taxes and other governmental
      assessments and charges that are material in amount, shown or determined to
      be
      due on such returns, reports and declarations, except those being contested
      in
      good faith and has set aside on its books provisions reasonably adequate for
      the
      payment of all taxes for periods subsequent to the periods to which such
      returns, reports or declarations apply. There are no unpaid taxes in any
      material amount claimed to be due by the taxing authority of any jurisdiction,
      and the officers of the Company know of no basis for any such claim. The Company
      has not executed a waiver with respect to the statute of limitations relating
      to
      the assessment or collection of any foreign, federal, state or local tax.

     

    J.  Disclosure.
      All
      information relating to or concerning the Company or any of its Subsidiaries
      set
      forth in this Agreement is true and correct in all material respects and the
      Company has not omitted to state any material fact necessary in order to make
      the statements made herein or therein, in light of the circumstances under
      which
      they were made, not misleading. No event or circumstance known to the Company
      has occurred or exists with respect to the Company or any of its Subsidiaries
      or
      its or their business, properties, prospects, operations or financial
      conditions, which, under applicable law, rule or regulation, requires public
      disclosure or announcement by the Company but which has not been so publicly
      announced or disclosed.

     

    K.  Patents,
      Copyrights, etc.
      (i) The
      Company and each of its Subsidiaries owns or possesses the requisite licenses
      or
      rights to use all patents, patent applications, patent rights, inventions,
      know-how, trade secrets, trademarks, trademark applications, service marks,
      service names, trade names and copyrights ("Intellectual Property") necessary
      to
      enable it to conduct its business as now operated; there is no claim or action
      by any person pertaining to, or proceeding pending, or to the Company's
      knowledge threatened, which challenges the right of the Company or of a
      Subsidiary with respect to any Intellectual Property necessary to enable it
      to
      conduct its business as now operated; to the best of the Company's knowledge,
      the Company's or its Subsidiaries' current and intended products, services
      and
      processes do not infringe on any Intellectual Property or other rights held
      by
      any person; and the Company is unaware of any facts or circumstances which
      might
      give rise to any of the foregoing. The Company and each of its Subsidiaries
      have
      taken reasonable security measures to protect the secrecy, confidentiality
      and
      value of their Intellectual Property.

     

    L.  Acknowledgment
      Regarding Buyers’ Purchase of Securities.
      The
      Company acknowledges and agrees that the Buyers are acting solely in the
      capacity of arm’s length purchasers with respect to this Agreement and the
      transactions contemplated hereby. The Company further acknowledges that no
      Buyer
      is acting as a financial advisor or fiduciary of the Company (or in any similar
      capacity) with respect to this Agreement and the transactions contemplated
      hereby and any statement made by any Buyer or any of their respective
      representatives or agents in connection with this Agreement and the transactions
      contemplated hereby is not advice or a recommendation and is merely incidental
      to the Buyers’ purchase of the Securities. The Company further represents to
      each Buyer that the Company’s decision to enter into this Agreement has been
      based solely on the independent evaluation of the Company and its
      representatives. 

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    M.  No
      Integrated Offering.
      Neither
      the Company, nor any of its affiliates, nor any person acting on its or their
      behalf, has directly or indirectly made any offers or sales in any security
      or
      solicited any offers to buy any security under circumstances that would require
      registration under the Securities Act of the issuance of the Securities to
      the
      Buyers. 

     

    N.  No
      Brokers.
      Except
      as set forth in Schedule N, the Company has taken no action which would give
      rise to any claim by any person for brokerage commissions, transaction fees
      or
      similar payments relating to this Agreement or the transactions contemplated
      hereby.

     

    O.  Environmental
      Matters.

     

    (i) There
      are, to the best of the Company’s knowledge, with respect to the Company or any
      of its Subsidiaries or any predecessor of the Company, no past or present
      violations of Environmental Laws (as defined below), releases of any material
      into the environment, actions, activities, circumstances, conditions, events,
      incidents, or contractual obligations which may give rise to any common law
      environmental liability or any liability under the Comprehensive Environmental
      Response, Compensation and Liability Act of 1980 or similar federal, state,
      local or foreign laws and neither the Company nor any of its Subsidiaries has
      received any notice with respect to any of the foregoing, nor is any action
      pending or, to the Company’s knowledge, threatened in connection with any of the
      foregoing. The term “Environmental Laws” means all federal, state, local or
      foreign laws relating to pollution or protection of human health or the
      environment (including, without limitation, ambient air, surface water,
      groundwater, land surface or subsurface strata), including, without limitation,
      laws relating to emissions, discharges, releases or threatened releases of
      chemicals, pollutants contaminants, or toxic or hazardous substances or wastes
      (collectively, “Hazardous Materials”) into the environment, or otherwise
      relating to the manufacture, processing, distribution, use, treatment, storage,
      disposal, transport or handling of Hazardous Materials, as well as all
      authorizations, codes, decrees, demands or demand letters, injunctions,
      judgments, licenses, notices or notice letters, orders, permits, plans or
      regulations issued, entered, promulgated or approved thereunder.

     

    (ii) Other
      than those that are or were stored, used or disposed of in compliance with
      applicable law, no Hazardous Materials are contained on or about any real
      property currently owned, leased or used by the Company or any of its
      Subsidiaries, and no Hazardous Materials were released on or about any real
      property previously owned, leased or used by the Company or any of its
      Subsidiaries during the period the property was owned, leased or used by the
      Company or any of its Subsidiaries, except in the normal course of the Company’s
      or any of its Subsidiaries’ business. 

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (iii) To
      the
      best of the Company’s knowledge there are no underground storage tanks on or
      under any real property owned, leased or used by the Company or any of its
      Subsidiaries that are not in compliance with applicable law.

     

    P.  Title
      to Property.
      The
      Company and its Subsidiaries have good and marketable title in fee simple to
      all
      real property and good and marketable title to all personal property owned
      by
      them which is material to the business of the Company and its Subsidiaries.
      Any
      real property and facilities held under lease by the Company and its
      Subsidiaries are held by them under valid, subsisting and enforceable leases
      with such exceptions as would not have a Material Adverse Effect. 

     

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

     

    R.  Permits;
      Compliance.
      The
      Company and each of its Subsidiaries is in possession of all franchises, grants,
      authorizations, licenses, permits, easements, variances, exemptions, consents,
      certificates, approvals and orders necessary to own, lease and operate its
      properties and to carry on its business as it is now being conducted
      (collectively, the "Company Permits"), and there is no action pending or, to
      the
      knowledge of the Company, threatened regarding suspension or cancellation of
      any
      of the Company Permits. Neither the Company nor any of its Subsidiaries is
      in
      conflict with, or in default or violation of, any of the Company Permits, except
      for any such conflicts, defaults or violations which, individually or in the
      aggregate, would not reasonably be expected to have a Material Adverse Effect.
      Since December 31, 2005, neither the Company nor any of its Subsidiaries has
      received any notification with respect to possible conflicts, defaults or
      violations of applicable laws, except for notices relating to possible
      conflicts, defaults or violations, which conflicts, defaults or violations
      would
      not have a Material Adverse Effect.

     

    S.  Foreign
      Corrupt Practices.
      Neither
      the Company, nor any of its Subsidiaries, nor any director, officer, agent,
      employee or other person acting on behalf of the Company or any Subsidiary
      has,
      in the course of his actions for, or on behalf of, the Company, used any
      corporate funds for any unlawful contribution, gift, entertainment or other
      unlawful expenses relating to political activity; made any direct or indirect
      unlawful payment to any foreign or domestic government official or employee
      from
      corporate funds; violated or is in violation of any provision of the U.S.
      Foreign Corrupt Practices Act of 1977, as amended, or made any bribe, rebate,
      payoff, influence payment, kickback or other unlawful payment to any foreign
      or
      domestic government official or employee. 

     

    T.  OTCBB.
      The
      Company is not in violation of the quotation requirements of the
      Over-the-Counter Bulletin Board (the "OTCBB")
      and
      does not reasonably anticipate that the Common Stock will be removed by the
      OTCBB in the foreseeable future. The Company and its Subsidiaries are unaware
      of
      any facts or circumstances which might give rise to any of the
      foregoing.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    U.  No
      Investment Company.
      The
      Company is not, and upon the issuance and sale of the Securities as contemplated
      by this Agreement will not be an “investment company” required to be registered
      under the Investment Company Act of 1940 (an “Investment
      Company”).
      The
      Company is not controlled by an Investment Company.

     

    V.  Certain
      Registration Matters.
      Assuming the accuracy of the Buyers’ representations and warranties set forth in
      Article II, no registration under the Securities Act is required for the offer
      and sale of the Conversion Shares and Warrant Shares by the Company to the
      Buyers under the transaction documents. 

     

    W.  Antitakeover
      Matters.

     

    (i)  The
      Company does not have 100 or more stockholders of record who have addresses
      in
      the State of Nevada appearing on the stock ledger of the Company.

     

    (ii)  The
      Company, its stockholders, and its Board of Directors have taken all actions
      required by Sections 78.378-78.3793 (inclusive) and Sections 78.411-78.444
      (inclusive) (collectively, the Takeover Provisions) of the General Corporation
      Law of the State of Nevada in connection with the transactions contemplated
      by
      this Agreement and the other Transaction Documents and no actions need be taken
      by any other person or entity for the transactions contemplated by this
      Agreement and the other Transaction Documents to be in compliance with the
      Takeover Provisions.

     

    X.  Offering.
      Subject
      in part to the truth and accuracy of each Buyer’s representations and warranties
      set forth in Article II, the offer, sale and issuance of the Securities as
      contemplated by this Agreement are exempt from the registration requirements
      of
      the Securities Act and applicable state securities and “blue sky” laws, and
      neither the Company nor any authorized agent acting on its behalf will take
      any
      action hereafter that would cause the loss of such exemption.

     

    Y.  Indebtedness.
      Attached hereto as Schedule Y.1 is a true, complete and correct list of all
      outstanding secured and unsecured Indebtedness of the Company or any Subsidiary,
      or for which the Company or any Subsidiary has commitments as of October 31,
      2006. The total amount of all Indebtedness (including, for this purpose, amounts
      less than $50,000 and including all principal and accrued interest) outstanding
      as of the date of this Agreement is $21,273,710, which number (excluding the
      obligations listed on Schedule Y.2 incurred after October 31, 2006) has not
      increased in the aggregate by more than $100,000 from October 31, 2006 through
      the date of this Agreement. For the purposes of this Agreement, “Indebtedness”
shall
      mean (a) any liabilities for borrowed money or amounts owed in excess of $50,000
      (other than trade accounts payable incurred in the ordinary course of business),
      (b) all guaranties, endorsements and other contingent obligations in respect
      of
      Indebtedness of others; and (c) the present value of any lease and other similar
      payments in excess of $50,000.

     

    Z.  NIR
      Group Settlement.
      On
      November 8, 2006, the Company executed that certain Agreement (the “NIR Group
      Settlement Agreement,” the form of which is attached hereto as Exhibit H) with
      all of the buyers (the “NIR Group”) of the Company’s Callable Secured
      Convertible Notes (the “NIR Group Notes”) listed under that certain Securities
      Purchase Agreement, dated September 20, 2005, between the Company and the NIR
      Group. Pursuant to the NIR Group Settlement Agreement, the Company has agreed
      to
      pay, and the NIR Group has agreed to accept, $2,800,000 in cash and warrants
      to
      purchase 3,000,000 shares of Common Stock as payment in full for all NIR Group
      Notes and for the full release of all liens on the Company’s assets and all
      other claims by the NIR Group against the Company. 

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    IV.

    CERTAIN
      COVENANTS AND ACKNOWLEDGMENTS

     

    A.  Restrictive
      Legend.
      Each
      Buyer acknowledges and agrees that, upon issuance pursuant to this Agreement,
      the Securities (including any Warrant Shares and Conversion Shares) shall have
      endorsed thereon a legend in substantially the following form (and a stop
      transfer order may be placed against transfer of the Securities until such
      legend has been removed):

     

    “NEITHER
      THESE SECURITIES NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE
      [CONVERTIBLE] HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
      OR THE SECURITIES COMMISSION OF ANY STATE OR FOREIGN COUNTRY IN RELIANCE UPON
      AN
      EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
      “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR
      FOREIGN COUNTRY. THE SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED OR SOLD
      IN
      THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
      APPLICABLE SECURITIES LAWS UNLESS OFFERED, SOLD OR TRANSFERRED UNDER AN
      AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE
      LAWS.”

     

    At
      the
      written request of any Buyer, the legend set forth above shall be removed and
      the Company shall issue a certificate without such legend to the holder of
      any
      Security upon which it is stamped, if, (a) such Security is registered for
      sale under an effective registration statement filed under the Securities Act
      or
      may otherwise be sold under Rule 144 or Regulation S without any
      restriction as to the number of securities as of a particular date that can
      be
      immediately sold, or (b) such holder provides the Company with an opinion
      of counsel, in form, substance and scope customary for opinions of counsel
      in
      comparable transactions, which opinion shall be reasonably acceptable to the
      Company’s counsel, to the effect that a public sale or transfer of such security
      may be made without registration under the Securities Act, which opinion shall
      be accepted by the Company so that the sale or transfer is effected, or
      (c) such holder provides the Company with reasonable assurances that such
      Security can be sold pursuant to Rule 144 or
      Regulation S.

     

    B.  Filings.
      The
      Company shall timely make all necessary filings with the Commission, including
      by not limited to a Form D with respect to the Securities as required under
      Regulation D, and “blue sky” filings required to be made by the Company in
      connection with the sale of the Securities to Buyer as required by all
      applicable Laws, and shall provide a copy thereof to Buyer promptly after such
      filing.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    The
      Company also agrees that it shall, on or prior to the Closing Date, take any
      other such action as the Company shall reasonably determine is necessary to
      qualify the Securities for sale to Buyers under such “blue sky” laws (or to
      obtain an exemption therefrom), and shall provide evidence of any such action
      so
      taken to Buyers on or prior to the Closing Date; provided that Company shall
      not
      be required to (a) qualify to generally do business in any jurisdiction
      where it would not otherwise be required to qualify but for this subsection
      or
      (b) subject itself to taxation in any such jurisdiction.

     

    C.  Reporting
      Status.
      So long
      as Buyers beneficially own any of the Securities, the Company shall file all
      reports required to be filed by it with the Commission pursuant to Section
      13 or
      15(d) of the Exchange Act or any reports or filings that are required by the
      OTCBB.

     

    D.  Registration
      Rights.
      The
      Company shall grant to Buyers demand and piggyback rights with respect to the
      Conversion Shares and the Warrant Shares pursuant to the terms of a Registration
      Rights Agreement, the form of which is attached hereto as Exhibit B, to be
      delivered to Buyers at the Closing. 

     

    E.  Use
      of
      Proceeds.
      The
      proceeds received by the Company from the sale of the Preferred Shares pursuant
      to this Agreement shall be expended by the Company solely as set forth in the
      Use of Proceeds delivered to the Buyers in connection with the execution of
      this
      Agreement (the “Use of Proceeds”).

     

    F.  No
      Integration.
      The
      Company shall not make any offers or sales of any security (other than the
      Preferred Shares and the Warrants offered hereby) under circumstances that
      would
      require registration of the Preferred Shares, the Warrants, the Conversion
      Shares or the Warrant Shares under the Securities Act or cause the offering
      of
      the Preferred Shares and the Warrants to be integrated with any other offering
      of securities by the Company for the purpose of any stockholder approval
      provision application to the Company or its securities.

     

    G.  Securities
      Laws Disclosure; Publicity.
      The
      Company shall not publicly disclose the name of a Buyer, or issue a press
      release or otherwise make a public statement or a filing with the Commission
      or
      any regulatory agency or trading market regarding the transactions contemplated
      by this Agreement or the fact that the Buyer is an investor in the Company
      without the prior consent of such Buyer in each instance (each a “Public
      Statement”), unless such Public Statement is required by applicable law or the
      rules of any securities exchange on which the securities of the Company are
      then
      listed or traded, in which case the Buyer shall have the right to review such
      Public Statement at least 96 hours in advance of the proposed release or filing
      and the Buyer may not unreasonably withhold or delay its consent to such release
      or filing . No Buyer may make a Public Statement without the prior consent
      of
      the Company, such consent not to be unreasonably withheld or delayed.

     

    H.  Amendment
      to Articles of Incorporation.
      The
      Company shall, as soon as possible, use its best efforts to take all steps
      necessary to amend Article Four of the Company’s Articles of Incorporation
      solely to increase the number of authorized shares of Common Stock to
      1,600,000,000 shares (the amendment to the Articles of Incorporation is herein
      referred to as the “Amended
      Articles”),
      in a
      form satisfactory to Leisurecorp LLC in its sole discretion. Such action shall
      include, but not be limited to, obtaining the consent of the Company’s Board of
      Directors and shareholders as required by applicable law, filing with the
      Commission a proxy statement or information statement (the “Shareholder
      Statement”), and complying with all rules, regulations and filing requirements
      of the Commission, the Nevada Corporation Law, and the OTCBB. The Buyers hereby
      agree to vote any shares of Common Stock that they may own at the time that
      the
      Company solicits for the approval of the Amended Articles in favor of the
      Amended Articles. 

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    I.  Additional
      Listings.
      The
      Company shall use its best efforts to cause its Common Stock to be listed on
      (i)
      the Nasdaq Global Market or the Nasdaq Capital Market (“Nasdaq”) on or before
      July 1, 2007, and (ii) the Dubai International Financial Exchange by December
      31, 2007. 

     

    J.  Signing
      Authority.
      From
      and after the date hereof until the earlier of such time as (i) the Company
      is
      listed on Nasdaq or (ii) both this Agreement is terminated under Article VII
      and
      the Promissory Notes have been repaid in full, Bart Collins (“Collins”) shall be
      an Executive Vice President of the Company and the Company shall not (through
      any officer, director, employee or otherwise), make any payment (or series
      of
      related payments) or agree to make any payment (or series of related payments)
      or issue or agree to issue securities of the Company in lieu of any payment
      to
      be made by or on behalf of the Company (a “Securities Issuance”) (a) in excess
      of $25,000, without the express written approval of Collins (whether or not
      covered by the Use of Proceeds) and (b) in excess of $100,000 (whether or not
      covered by the Use of Proceeds), without having the signature of Collins on
      (x)
      the check or other financial instrument pursuant to which such payment will
      be
      made, on (y) the wire transfer instructions authorizing the wire transfer
      pursuant to which such payment will be made or (z) in the case of a Securities
      Issuance, specific authorization for such Securities Issuance including the
      number of shares or securities to be issued and the terms thereof.

     

    K.  NIR
      Group Settlement.
      The
      Company shall pay all amounts due pursuant to the NIR Group Settlement as soon
      as possible, but in no event later than five business days following the date
      of
      this Agreement, and the Company shall take all actions necessary to satisfy
      the
      condition set forth in Article V(P) as soon as possible.

     

    V.

     CLOSING
      DATE

     

    Subject
      to the satisfaction or waiver of the closing conditions in Article VI and VII,
      the Closing shall occur at the law offices of Clifford Chance US LLP, 31 West
      52nd Street, New York, NY 10019 at 10:00 a.m. as soon as practicable (but in
      any
      event within seven business days) following the date on which the Amended
      Articles have been filed in the office of the Nevada Secretary of State and
      such
      Amended Articles are in full force and effect, or such other date as Company
      and
      all Buyers shall agree; provided, however, that the Closing Date shall not
      be
      later than March 31, 2007. 

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    VI.

    CONDITIONS
      TO THE COMPANY’S OBLIGATIONS

     

    Each
      Buyer understands that the Company’s obligation to sell the Preferred Shares and
      issue the Warrants on the Closing Date to such Buyer pursuant to this Agreement
      is conditioned upon:

     

    A.  The
      Amended Articles shall have been duly and validly filed in the office of the
      Nevada Secretary of State, and shall be in full force and effect.

     

    B.  Payment
      by each Buyer to Company of the purchase price in the manner specified in
      Article I. B.

     

    C.  The
      representations and warranties of such Buyer contained in this Agreement shall
      be true and correct as of the Closing Date as if made on the Closing Date
      (except for representations and warranties which, by their express terms, speak
      as of and relate to a specified date, in which case such representations and
      warranties shall be true and correct as of such specified date) and the Buyer
      shall have performed, in all material respects, all covenants and agreements
      of
      Buyer required to be performed by it pursuant to this Agreement on or before
      the
      Closing Date.

     

    D.  There
      shall not be in effect any law or order, ruling, judgment or writ of any court
      or public or governmental authority or self regulatory organization restraining,
      enjoining or otherwise prohibiting any of the transactions contemplated by
      this
      Agreement. 

     

    E.  Delivery
      by the Buyers to the Company of executed counterparts of the Registration Rights
      Agreement. 

     

    F.  The
      conversion of the indebtedness listed on Exhibit F(2) into Preferred Shares,
      Common Stock and Warrants in accordance with the Debt Exchange Agreement (the
      form of which is attached hereto as Exhibit G) entered into by the Company
      and
      each debtor listed on Exhibit F(2). 

     

    VII.

    CONDITIONS
      TO BUYERS’ OBLIGATIONS

     

    The
      Company understands that Buyers’ obligation to purchase the Securities on the
      Closing Date pursuant to this Agreement is conditioned upon:

     

    A.  The
      Amended Articles shall have been approved in accordance with all applicable
      laws
      and the Company’s Articles of Incorporation and shall have been duly and validly
      filed in the office of the Nevada Secretary of State, and shall be in full
      force
      and effect.

     

    B.  The
      Commission shall have cleared the Shareholder Statement, and the Shareholder
      Statement shall have been duly delivered to all shareholders who are required
      by
      the rules of the Commission and the Nevada Corporation Law.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    C.  No
      Event
      of Default (as defined in the Promissory Notes) shall have occurred and be
      continuing under any Promissory Note as of the Closing Date.

     

    D.  Delivery
      by the Company to Buyers of the Preferred Shares and the Warrants (I/N/O Buyers
      or I/N/O Buyers’ nominee) in the amounts set forth in Article I.B.

     

    E.  Delivery
      by the Company to Buyers of executed counterparts of the Registration Rights
      Agreement.

     

    F.  Investment
      by Buyers of $13,000,000 of cash under this Agreement and the cancellation
      and
      exchange of $2,740,892 of indebtedness by GWSE.

     

    G.  The
      representations and warranties of the Company contained in this Agreement shall
      be true and correct on the Closing Date as if made on the Closing Date (except
      for representations and warranties which, by their express terms, speak as
      of
      and relate to a specified date, in which case such representations and
      warranties shall be true and correct as of such specified date) and the Company
      shall have performed, in all respects, all covenants and agreements of the
      Company required to be performed by it pursuant to this Agreement on or before
      the Closing Date. 

     

    H.  The
      Chief
      Executive Officer of the Company shall have delivered a certificate to the
      Buyers, dated as of the Closing Date, certifying that the condition set forth
      in
      paragraph D above has been fulfilled. 

     

    I.  The
      conversion of the indebtedness listed on Exhibit F(2) into Preferred Shares
      and
      Warrants in accordance with the Debt Exchange Agreement (the form of which
      is
      attached hereto as Exhibit G) entered into by the Company and each debtor listed
      on Exhibit F(2). 

     

    J.  There
      shall not be in effect any law or order, ruling, judgment or writ of any court
      or public or governmental authority or self regulatory organization restraining,
      enjoining or otherwise prohibiting any of the transactions contemplated by
      this
      Agreement.

     

    K.  The
      Certificate of Designation shall have been filed with the Secretary of State
      of
      the State of Nevada and shall be in full force and effect.

     

    L.  The
      election of Robert Linn and Timothy John Prescott or such other persons as
      are
      designated by Leisurecorp prior to the Closing as Preferred Directors (as
      defined in the Certificate of Designation) as additional directors on the
      Company’s Board of Directors, such election to become effective immediately
      following the Closing.

     

    M.  Receipt
      by Buyers of a legal opinion of the Company’s counsel, in the form of Exhibit C
      attached hereto.

     

    N.  The
      Company’s Board of Directors shall have amended the Company’s bylaws as set
      forth in Exhibit D, and such bylaw amendment shall be in full force and
      effect.

     

    O.  The
      Company, each of the Buyers, Doug Wood and Robert Silzer shall have executed
      and
      delivered the Shareholder Agreement in the form attached hereto as Exhibit
      E.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    P.  The
      Company shall have completed the NIR Group Settlement, including the
      cancellation of all NIR Group Notes, the release of liens and security interests
      on the Company’s assets granted in favor of the NIR Group, and the payment of
      the entire settlement payment (in cash and by the issuance of additional
      warrants) in accordance with the NIR Group Settlement Agreement.

     

    VIII.

    TERMINATION

     

    A.  Termination
      by Mutual Written Consent.
      This
      Agreement may be terminated and the transactions contemplated hereby may be
      abandoned, for any reason and at any time prior to the Closing Date, by the
      mutual written consent of the Company and any Buyer.

     

    B.  Termination
      by Buyers.
      This
      Agreement may be terminated and the transactions contemplated hereby may be
      abandoned by any Buyer at any time prior to the Closing Date, if (i) the Company
      shall have failed to comply with any of its covenants or agreements contained
      in
      this Agreement, (ii) there shall have been a breach by the Company of any
      representation or warranty made by it in this Agreement, (iii) there shall
      have
      occurred any event or development, or there shall be in existence any condition,
      having or reasonably likely to have a Material Adverse Effect, (iv) an Event
      of
      Default (as defined in the Promissory Notes) shall have occurred under any
      Promissory Note, or (v) the Company shall have failed to satisfy the conditions
      provided in Article VII by March 31, 2007.

     

    C.  Termination
      by the Company.
      This
      Agreement may be terminated and the transactions contemplated hereby may be
      abandoned by the Company at any time prior to the Closing Date, if (i) Buyers
      shall have failed to comply with any of its covenants or agreements contained
      in
      this Agreement or (ii) there shall have been a breach by Buyers of any
      representation or warranty made by it in this Agreement.

     

    D.  Effect
      of Termination.
      In the
      event of the termination of this Agreement pursuant to this Article VIII, this
      Agreement shall thereafter become void and have no effect, and neither party
      hereto shall have any liability or obligation to the other party hereto in
      respect of this Agreement, except as expressly provided herein; provided,
      however, that neither party shall be released from any liability hereunder
      if
      this Agreement is terminated and the transactions contemplated hereby abandoned
      by reason of (i) willful failure of such party to perform its obligations
      hereunder or (ii) any misrepresentation made by such party of any matter set
      forth herein.

     

    IX.

    SURVIVAL;
      INDEMNIFICATION

     

    A.  The
      representations, warranties and covenants made by each of the Company and each
      Buyer in this Agreement, the annexes, schedules and exhibits hereto and in
      each
      instrument, agreement and certificate entered into and delivered by them
      pursuant to this Agreement shall survive the Closing and the consummation of
      the
      transactions contemplated hereby. In the event of a breach or violation of
      any
      of such representations, warranties or covenants, the party to whom such
      representations, warranties or covenants have been made shall have all rights
      and remedies for such breach or violation available to it under the provisions
      of this Agreement or otherwise, whether at law or in equity, irrespective of
      any
      investigation made by or on behalf of such party on or prior to the Closing
      Date.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    X.

    GOVERNING
      LAW; JURISDICTION

     

    This
      Agreement shall be governed by and interpreted in accordance with the laws
      of
      the State of New York. Each party hereby irrevocably submits to the exclusive
      jurisdiction of the state and federal courts sitting in The City of New York,
      Borough of Manhattan, for the adjudication of any dispute hereunder or in
      connection herewith or with any transaction contemplated hereby or discussed
      herein, and hereby irrevocably waives, and agrees not to assert in any suit,
      action or proceeding, any claim that it is not personally subject to the
      jurisdiction of any such court, that such suit, action or proceeding is brought
      in an inconvenient forum or that the venue of such suit, action or proceeding
      is
      improper.

     

    XI.

    COUNTERPARTS;
      EXECUTION

     

    This
      Agreement may be executed in two (2) counterparts, each of which when so
      executed and delivered shall be an original, but both of which counterparts
      shall together constitute one and the same instrument. A facsimile transmission
      of this signed Agreement shall be legal and binding on all parties
      hereto.

     

    XII.

    HEADINGS

     

    The
      headings of this Agreement are for convenience of reference and shall not form
      part of, or affect the interpretation of, this Agreement.

     

    XIII.

    SEVERABILITY

     

    This
      Agreement shall be deemed severable, and the invalidity or unenforceability
      of
      any term or provision hereof shall not affect the validity or enforceability
      of
      this Agreement or of any other term or provision hereof. Furthermore, in lieu
      of
      any such invalid or unenforceable term or provision, the parties hereto intend
      that there shall be added as a part of this Agreement a provision as similar
      in
      terms to such invalid or unenforceable provision as may be possible and be
      valid
      and enforceable.

     

    XIV.

    ENTIRE
      AGREEMENT; REMEDIES, AMENDMENTS AND WAIVERS

     

    This
      Agreement and the Documents constitute the entire agreement between the parties
      hereto pertaining to the subject matter hereof and supersede all prior
      agreements, understandings, negotiations and discussions, whether oral or
      written, of such parties. No supplement, modification or waiver of this
      Agreement shall be binding unless executed in writing by both parties. No waiver
      of any of the provisions of this Agreement shall be deemed or shall constitute
      a
      waiver of any other provision hereof (whether or not similar), nor shall such
      waiver constitute a continuing waiver unless otherwise expressly
      provided.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    XV.

    NOTICES

     

    Except
      as
      may be otherwise provided herein, any notice or other communication or delivery
      required or permitted hereunder shall be in writing and shall be delivered
      personally, or sent by telecopier machine or by a nationally recognized
      overnight courier service, and shall be deemed given when so delivered
      personally, or by telecopier machine or overnight courier service as
      follows:

     

     

    
      	A.	if
              to the Company, to:
	 	 
	 	
              GPS
                Industries, Inc.

              Suite
                214

              5500
                152nd Street

              Surrey,
                British Columbia

              Canada
                V35 S59

              Attn:
                Chief Executive Officer

              Telecopier:
                (604) 576-7460 

               

              with
                a copy to:

               

              Troy
                & Gould

              1801
                Century Park East, 26th Floor

              Los
                Angeles, California 90067

              ATTN:
                David L. Ficksman, Esq.

              Telecopier:
                (310) 789-1490

            
	 	 
	B.	If to a Buyer,
              to the
              address set forth on the signature page:

    

      

    The
      Company or any Buyer may change the foregoing address by notice given pursuant
      to this Article XV.

     

    XVI.

    ASSIGNMENT

     

    This
      Agreement shall not be assignable by either of the parties hereto without the
      prior written consent of the other party, and any attempted assignment contrary
      to the provisions hereby shall be null and void; provided, however, that any
      Buyer may assign its rights and obligations hereunder, in whole or in part,
      to
      any affiliate of such Buyer.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    XVII.

    REMEDIES
      CUMULATIVE

     

    In
      the
      event that the Company fails to observe or perform any covenant or agreement
      to
      be observed or performed under this Agreement, any Buyer may proceed to protect
      and enforce its rights by suit in equity or action at law, whether for specific
      performance of any term contained in this Agreement or for an injunction against
      the breach of any such term or in aid of the exercise of any power granted
      in
      this Agreement or to enforce any other legal or equitable right, or to take
      any
      one or more of such actions, without being required to post a bond. None of
      the
      rights, powers or remedies conferred under this Agreement shall be mutually
      exclusive, and each such right, power or remedy shall be cumulative and in
      addition to any other right, power or remedy, whether conferred by this
      Agreement or now or hereafter available at law, in equity, by statute or
      otherwise.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties hereto have duly caused this Agreement to be
      executed and delivered on the date first above written.

     

     

     

    
      	 	“COMPANY”
	 	GPS
              Industries, Inc., 
	 	a
              Nevada corporation
	 	 	 
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

    

    

    In
      order
      to induce the Buyers to enter into this Agreement, we, Robert C. Silzer, Sr.
      and
      Douglas Wood, hereby agree to vote, or give written consent with respect to,
      any
      and all shares of Common Stock that we own in favor of the Amended Articles
      as
      described in Article IV.H of this Agreement.

     

    

    
      	_________________________________ 	_____________________________
	Robert C. Silzer, Sr.	Douglas
              Wood

    

     

    
       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK

    

    SIGNATURE
      PAGE FOR PURCHASER FOLLOWS]

     

     

     

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    “BUYER”

     

    

    LEISURECORP
      LLC

    

    

    By:_________________________

    Name:
      

    Title:
      

    

    Investment
      Amount: $10,000,000

    Number
      of
      Preferred Shares: 1,000,000

    Number
      of
      Warrant Shares: 40,983,607

    

    Address
      for Notice:

    David
      Spencer 

    Chief
      Executive Officer 

    Istithmar
      Leisure 

    P.O.
      Box
      17000, Dubai, UAE 

    Telephone:
      +9714-3687630 

    Telecopy:
      +9714-3687654

    E-mail: David.Spencer@istithmar.ae

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

       

    

    “BUYER”

     

    

    GREAT
      WHITE SHARK ENTERPRISES, INC.

    

    

    By:_________________________

    Name:
      

    Title:
      

    

    Investment
      Amount: $3,000,000 cash; $2,740,890 cancellation of indebtedness

    Number
      of
      Preferred Shares: 574,089

    Number
      of
      Warrant Shares: 18,901,579

    

    Address
      for Notice:

    Great
      White Shark Enterprises, Inc.

    501
      North
      A1A, Jupiter, FL 33477

    Attn:
      Bart Collins

    Telephone:
      (561) 743-8818

    Telecopy:
      (561) 743-8831

    E-mail:
      Bart.Collins@gwse.com

    

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

    

    EXHIBIT
      A

    

    CERTIFICATE
      OF DESIGNATION

    

    

    [SEE
      EXHIBIT 4.1 OF THE FORM 8-K TO WHICH THIS SECURITIES PURCHASE AGREEMENT IS
      ATTACHED

     

     

     

     

     

    
 

    
      
        
        

      

      
        A
          -1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

    

    REGISTRATION
      RIGHTS AGREEMENT

    

    

    [SEE
      EXHIBIT 10.2 OF THE FORM 8-K TO WHICH THIS SECURITIES PURCHASE AGREEMENT IS
      ATTACHED]

     

     

     

     

     

     

     

    
      
        
        

      

      
        B
          -1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

     

    [DRAFT]

    

    _________,
      200_

    

    

    Buyers
      Listed on Signature Page

    Of
      Securities Purchase Agreement

    

    

     

    
      	 	
              Re:

            	
              GPS
                Industries, Inc. Securities Purchase
                Agreement

            

    

    

    Dear
      Ladies and Gentlemen:

    

    We
      have
      represented GPS Industries, Inc., a Nevada corporation (the “Company”),
      in
      connection with that certain Securities Purchase Agreement dated as of November
      __, 2006 by and among the Company and the Buyers (as such term is defined
      therein) (the “Purchase
      Agreement”).
      We
      are rendering this opinion letter to you pursuant to Article VII. M. of the
      Purchase Agreement. Unless otherwise defined herein, the capitalized terms
      used
      herein shall have the meanings therefor set forth in the Purchase Agreement.
      

     

    
      
        	
              	A.	
                Reviewed
                  Documents:

              

      

    

     

    In
      rendering the opinions expressed below, we have reviewed and examined originals
      or copies of the following (collectively, the “Reviewed
      Documents”):

     

    1.  The
      Purchase Agreement;

     

    2.  The
      Warrants;

     

    3.  The
      Registration Rights Agreement;

     

    4.  The
      Shareholder Agreement;

     

    5.  The
      Certificate of Designation, as filed with the Secretary of State of the State
      of
      Nevada on ________, 200_.

     

    6.  The
      Company’s Articles of Incorporation (the “Articles”)
      and
      Bylaws (“Bylaws”),
      each
      as amended to date;

     

    7.  A
      Certificate of Good Standing for the Company dated ___________, 200_ issued
      by
      the Nevada Secretary of State [DATE TO BE WITHIN 3 BUSINESS DAYS];

     

    
      
        
        

      

      
        C
          - 1

        
          

        

      

      
        
        

      

       

    

    8.  A
      Certificate dated the date hereof executed by Robert C. Silzer, Sr., Chief
      Executive Officer of the Company, a copy of which is attached hereto (the
“Officer’s
      Certificate”);
      and

     

    9.  Resolutions
      of the Board of Directors of the Company adopted at meetings convened on
      November 3, 2006 and ________, 2006 authorizing, among other things, (i) the
      execution and delivery of the Purchase Agreement, the Registration Rights
      Agreement and the Warrants, (ii) filing of the Certificate of Designation,
      and
      (iii) the performance of the transactions contemplated thereby, and the
      reservation of the Warrant Shares.

     

    The
      agreements listed in items 1-4 above are hereinafter referred to as the
“Opined
      Agreements”.

     

    
      
        	
              	B.	
                Assumptions:

              

      

    

     

    With
      your
      permission, we have made (and are relying upon) the following assumptions,
      all
      without any investigation, inquiry or consideration by us and regardless of
      the
      reasonableness of such assumptions (although we have no actual current knowledge
      that such assumptions are unreasonable):

     

    1.  All
      information furnished to us is accurate and complete; all documents submitted
      to
      us as original or certified documents are genuine; the original or certified
      documents of all copies submitted to us as conformed or photocopies thereof
      conform to the originals thereof; and all signatures on all documents are
      genuine.

     

    2.  All
      natural persons who have executed any of the Reviewed Documents have the legal
      capacity to do so.

     

    3.  All
      proceedings necessary to authorize the actions of the Buyers (collectively,
      the
“Nonclient
      Parties”)
      have
      been taken; (b) each of the Nonclient Parties has all requisite legal
      capacity, power and authority to enter into and perform the Opined Agreements
      to
      which it, he or she is a party and any other agreements contemplated thereby
      to
      which it, he or she is a party (collectively along with such Opined Agreements,
      the “Nonclient
      Agreements”),
      and
      to perform the transactions contemplated thereby; (c) all Nonclient
      Agreements are the legal, valid and binding obligations of the Nonclient Parties
      signatory thereto enforceable against such Nonclient Parties in accordance
      with
      their terms; and (d) the execution and performance by the Nonclient Parties
      of the Nonclient Agreements to which they are a party will not violate any
      charter, bylaw, organizational documents, law, rule, regulation, agreement
      or
      covenant to which such Nonclient Parties are subject.

     

    4.  The
      representations and warranties as to the factual matters contained in the
      Reviewed Documents are true and correct.

     

    
      
        
        

      

      
        C
          - 2

        
          

        

      

      
        
        

      

       

    

    5.  All
      certificates and reports obtained by us from officers, managers, directors,
      representatives, partners or public officials are accurate and
      complete.

     

    6.  Except
      for the Reviewed Documents, there are no other documents or agreements between
      the Company and the Nonclient Parties that would expand or otherwise modify
      the
      obligations of the Company under the Opined Agreements or that would have any
      effect on the opinions rendered herein.

     

    7.  No
      fraud,
      dishonesty, forgery, coercion, duress or breach of fiduciary duty exists or
      will
      exist with respect to any matter relevant to our opinions herein.

     

    8.  We
      call
      to your attention that the Opined Agreements purport to be governed by the
      laws
      of the State of New York. We are not licensed to practice law in such State,
      and
      we are not rendering herein, expressly, by implication or otherwise, any
      opinions based upon or about New York law. To the extent that any laws of the
      State of New York or of any other jurisdiction, other than the internal law
      of
      the State of California, the Federal laws of the United States of America,
      or
      the Chapter 78 of the Nevada General Corporation Law, may bear upon or otherwise
      be relevant to any of our opinions expressed herein, we have assumed (without
      rendering any opinion to such effect) that such other laws are in all respects
      material to this opinion substantively identical to the laws of the State of
      California, without regard to conflict of law provisions, and would not cause
      any of such opinions to be incorrect or misleading, or cause us otherwise to
      change or reword such opinions.

     

    
      
        	
              	C.	
                Knowledge:

              

      

    

     

    Whenever
      a statement hereinbelow is qualified by “known to us,” “to our knowledge” or
      similar phrase, it means that, during the course of our representation of the
      Company for the purposes of this opinion letter, (1) no information that
      would give those lawyers who participated in the preparation and negotiation
      of
      the Opined Agreements or this opinion letter (collectively, the “Participants”)
      actual
      knowledge of the inaccuracy of such statement has come to their attention;
      (2) we have not undertaken any independent investigation or inquiry to
      determine the accuracy of such statement; and (3)  no inference as to
      our knowledge of any matters bearing on the accuracy of any such statement
      should be drawn from the fact of our prior representation of the
      Company.

     

    
      
        	
              	D.	
                Opinions:

              

      

    

     

    Based
      upon the foregoing and subject to the assumptions, limitations and
      qualifications set forth herein, we are of the opinion that:

     

    1.  Based
      solely upon the Company’s Articles of Incorporation and Bylaws, the Good
      Standing Certificate and the Officers’ Certificate, the Company is duly
      incorporated, validly existing and in good standing under the laws of Nevada.
      

     

    
      
        
        

      

      
        C
          - 3

        
          

        

      

      
        
        

      

       

    

    2.  The
      Company has the requisite corporate power and corporate authority to (a) own
      and
      use its properties and assets, (b) carry on its business as currently conducted,
      and (c) enter into and to consummate the transactions contemplated by each
      of
      the Opined Agreements and otherwise to carry out its obligations thereunder.
      

     

    3.  The
      execution and delivery by the Company of the Opined Agreements and the
      performance by the Company of its obligations thereunder, have been duly and
      validly authorized by the Board of Directors of the Company, no other corporate
      action on the part of the Company or its stockholders is necessary to authorize
      such execution and delivery. 

     

    4.  The
      Opined Agreements have been duly and validly executed and delivered by the
      Company and constitute the legal, valid and binding obligation of the Company,
      enforceable against the Company in accordance with their terms.

     

    5.  The
      rights, preferences and privileges of the Preferred Shares are as stated in
      the
      Certificate of Designation filed with the Secretary of State of the State of
      Nevada on ________, 200_. The Preferred Stock and the Warrants have been duly
      authorized and when issued and delivered by the Company in accordance with
      the
      terms of the Purchase Agreement will be validly issued and fully paid and
      nonassessable. The shares of Common Stock of the Company which will be issued
      to
      the Buyers upon conversion of the shares of Preferred Shares and exercise of
      the
      Warrants have been duly authorized, and upon issuance and delivery in accordance
      with the Articles of Incorporation and the Warrants, will be validly issued,
      fully paid and nonassessable. 

     

    6.  The
      execution, delivery and performance by the Company of the Opined Agreements
      and
      the consummation of the transactions contemplated thereby did not and will
      not
      (a) conflict with or result in a violation or breach of any of the terms,
      conditions or provisions of the Articles of Incorporation, Certificate of
      Designation or By-laws of the Company; (b) conflict with or result in a
      violation or breach of any term or provision of any applicable law that in
      our
      experience is typically applicable to offerings of securities of the type
      contemplated by the Purchase Agreement or any order known to us applicable
      to
      the Company (other than such conflicts, violations or breaches (i) which could
      not in the aggregate reasonably be expected to materially adversely affect
      the
      validity or enforceability of the Opined Agreements or to have a material
      adverse effect on the business or condition of the Company or (ii) as would
      occur solely as a result of the identity or the legal or regulatory status
      of
      the Buyers); or (c) to our knowledge (i) conflict with or result in a violation
      or breach of, (ii) constitute (with or without notice or lapse of time or both)
      a default under, (iii) require the Company to obtain any consent, approval
      or
      action of, make any filing with or give any notice to any person which is not
      a
      governmental or regulatory body, (iv) result in the creation or imposition
      of
      any lien upon the Company or any of its assets and properties, under any
      contract, instrument, agreement or license known to us to which the Company
      is a
      party or by which any of its assets and properties is bound and which,
      individually or in the aggregate with other such contracts, instruments,
      agreements and licenses, is material to the validity or enforceability of the
      Agreements or to the business or condition of the Company.

     

    
      
        
        

      

      
        C
          - 4

        
          

        

      

      
        
        

      

       

    

    7.  No
      consent, approval or action of, filing with or notice to any federal, state
      or
      local governmental authority on the part of the Company (other than those that
      have been obtained, made or given, as he case may be, and are in full force
      and
      effect) is required in connection with the execution, delivery and performance
      of the Opined Agreements or the consummation of the transactions contemplated
      thereby, except (a) as disclosed in the Purchase Agreement, (b) where the
      failure to obtain any such consent, approval or action, to make any such filing
      or to give any such notice could not reasonably be expected to materially
      adversely affect the validity or enforceability of the Opined Agreements or
      to
      have a material adverse effect on the business or condition of the Company
      or
      (c) those as would be required solely as a result of the identity or the legal
      or regulatory status of the Buyers.

     

    8.  To
      our
      knowledge, there is no action, proceeding or investigation pending or overtly
      threatened against the Company before any court or administrative agency that
      questions the validity of the Opined Agreements or that might result, either
      individually or in the aggregate, in any material adverse change in the assets,
      financial condition, or operations of the Company and none that questions the
      validity of the Opined Agreements or the Certificate of Designation or any
      action taken or to be taken in connection therewith.

     

    9.  Based
      in
      part upon the representations of the Company and the Buyers contained in the
      Purchase Agreement, the offer, issuance, sale and delivery of the Preferred
      Shares and the Warrants in accordance with the terms of the Purchase Agreement,
      and the issuance and delivery of the Common Stock issuable upon conversion
      of
      the Preferred Shares and exercise of the Warrants in accordance with the terms
      of the Certificate of Designation and the Warrants constitute transactions
      exempt from the registration requirements of the Securities Act of 1933, as
      amended.

     

    
      
        	
              	E.	
                Qualifications:

              

      

    

     

    Notwithstanding
      anything to the contrary contained in this letter, our opinions expressed above
      are limited by and subject to the following:

     

    1.  Applicable
      bankruptcy, insolvency, reorganization, arrangement, moratorium and other
      similar laws and court decisions relating to, limiting or affecting the rights
      of contract obligors or obligees (including, without limitation, laws relating
      to fraudulent conveyances, preferences and equitable
      subordination).

     

    
      
        
        

      

      
        C
          - 5

        
          

        

      

      
        
        

      

       

    

    2.  General
      principles of equity (whether considered in a suit in equity or at law). In
      that
      connection, we neither express nor imply any opinion as to the availability
      of
      the remedies of specific performance, injunctive relief, or any other equitable
      remedy, all of which are subject to limitations imposed by applicable law and
      to
      the discretion of the court before which such proceedings may be brought.

     

    3.  The
      requirement that a party to a contract act in a commercially reasonable manner,
      and in compliance with an implied covenant of good faith and fair dealing.
      

     

    4.  We
      express no opinion with respect to the validity, binding effect or
      enforceability of any provision of any Opined Agreement that purports to do
      any
      of the following:

     

    (a)  Obligate
      any person to take any action to the extent such action would cause such person
      to violate applicable law.

     

    (b)  Designate
      New York law or the law of any other jurisdiction as the law applicable to
      the
      Opined Agreements and the transactions contemplated thereby. 

     

    (c)  Impose
      liability upon any person or entity (“Person”)
      for
      payment of attorneys’ fees and costs in any action or proceeding that proceeds
      to judgment, except to the extent that (i) such agreement requires payment
      of attorneys’ fees and costs to the prevailing party in such action or
      proceedings, and (ii) any such fees are reasonable.

     

    (d)  Define
      good faith or commercially reasonable behavior.

     

    (e)  Indemnify
      or otherwise exonerate a Person from the consequences of such Person’s actions
      or inactions, negligent, wrongful or illegal acts, or violations of law,
      including, without limitation, applicable securities laws, or when such
      indemnification or exoneration is contrary to public policy, it being
      acknowledged that certain defenses, such as waiver, estoppel and laches, may
      not
      be waivable in any event.

     

    (f)  Allow
      a
      party to withhold “unreasonably” or in its “sole discretion” its consent to, or
      approval of, any action or proposed action of another party.

     

    (g)  Waive
      the
      rights of a party to a jury trial or to object to jurisdiction or venue, or
      to
      assert any defense based on lack of jurisdiction or venue.

     

    (h)  Provide
      that (i) rights, powers or remedies are not exclusive, or (ii) some or
      all rights, powers or remedies are cumulative and may be exercised in addition
      to or with any other rights, powers or remedies, or (iii) the election of
      some particular right, power or remedy does not preclude recourse to one or
      more
      others, or (iv) any single or partial exercise of any right, power or
      remedy does not preclude any other or further exercise thereof or the exercise
      of any other right, power or remedy or that rights, powers, or remedies may
      be
      exercised in such order or manner as a party may determine; (v) failure to
      exercise (or delay in exercising) rights, powers or remedies will not operate
      as
      laches or estoppel with respect to, or a waiver of, such rights, powers or
      remedies; (vi) failure to enforce strict performance of the terms of any of
      the Opined Agreements shall not constitute a waiver of a party’s rights under
      the Opined Agreements; or (vii) failure to exercise (or delay in
      exercising) rights, powers or remedies will not extend any cure period or be
      deemed a cure of any default.

     

    
      
        
        

      

      
        C
          - 6

        
          

        

      

      
        
        

      

       

    

    (i)  Provide
      that the legality or enforceability or provisions in an Opined Agreement or
      any
      instrument or agreement required thereunder remains unaffected or unimpaired
      if
      a material provision of the Opined Agreement is invalid, illegal or
      unenforceable. 

     

    (j)  Provide
      that a waiver of a condition in one situation shall not constitute a waiver
      of
      such condition in other situations, or that waivers, releases, modifications,
      amendments, revisions, revocations, terminations, changes and variations in
      or
      to any Opined Agreement must be in writing; (ii) waive vaguely or broadly
      stated rights or unknown future rights; (iii) waive the benefits of any
      statutory, regulatory or constitutional rights, unless and to the extent the
      statute, regulation, or constitution explicitly allows such waiver;
      (iv) waive rights to damages; (v) waive rights that pursuant to
      certain applicable statutes and rules of law or public policy cannot be waived
      prospectively by an obligor or indemnitor; or (vi) provide that conduct
      shall not constitute a waiver of a Person’s rights or remedies or that one
      Person’s conduct shall not constitute a waiver of another Person’s rights or
      remedies.

     

    (k)  Bind
      or
      have legal effect against any Person other than the Company.

     

    (l)  Determine
      the validity or effectiveness of governmental actions or the actions of other
      third parties.

     

    
      
        	
              	F.	
                Other
                  Limitations:

              

      

    

     

    The
      opinions and other matters in this letter are qualified in their entirety and
      subject to the following:

     

    1.  We
      are
      members of the State Bar of California. We neither express nor imply any opinion
      as to the laws of any jurisdiction other than the internal laws of the State
      of
      California, the Nevada Corporate Law and the Federal laws of the United States
      of America that are, in our experience, normally applicable to transactions
      contemplated by the Purchase Agreement. The foregoing laws considered by us
      exclude, and we neither express nor imply any opinion as to: (a) laws of any
      counties, cities, towns, municipalities and special political subdivisions
      and
      any agencies thereof; or (b) any state “blue sky” or foreign securities laws,
      rules or regulations.

     

    2.  The
      opinions expressed above concern only the effect of laws as currently in effect.
      This letter and the matters addressed herein are as of the date hereof, and
      we
      undertake no, and hereby disclaim any, obligation to advise you of any change
      in
      any mater set forth herein, whether based on a change in the law, a change
      in
      any fact relating to the Company or any other Person, or any other circumstance.
      This opinion letter is limited to the matters expressly stated herein and no
      opinions are to be inferred or may be implied beyond the opinions expressly
      set
      forth herein.

     

    
      
        
        

      

      
        C
          - 7

        
          

        

      

      
        
        

      

       

    

    3.  We
      neither express nor imply any opinion as to (a) the financial condition or
      solvency of the Company; (b) the ability (financial or otherwise) of the Company
      or any other Person to meet its respective obligations under the Opined
      Agreements; (c) the conformity of the Opined Agreements to any term sheet or
      commitment letter; or (d) the compliance of the transactions contemplated
      by the Purchase Agreement with any regulations or governmental requirements
      applicable to any Person other than the Company. 

     

    4.  This
      opinion letter was prepared, and should be interpreted, in accordance with
      the
      Business Law Section of the State Bar of California, 2005
      Report of the Corporations Committee of the Business Law Section of the State
      Bar of California Regarding Legal Opinions in Business
      Transactions,
      and the
      Business Law Section of the State Bar of California, 2004
      Report on Third-Party Remedies Opinions
      (including its eleven appendices). Without limiting the generality of the
      foregoing, with respect to our opinions set forth above as to the Company’s
      corporate power and corporate authority, we interpret that phrase to mean that
      the action would not be ultra
      vires
      with
      respect to the Company and such phrase does not extend to any Federal, state
      or
      local authorizations or approvals.

     

    5.  Except
      for the Reviewed Documents, we have not conducted any review of any of the
      Company’s operations or of any other person’s or entity’s operations, or of any
      agreement that may have been executed by, or which may now be binding upon,
      any
      of them, nor have we reviewed our internal files or any files of the Company
      or
      of any other person or entity relating to transactions to which any of them
      may
      be a party, or conducted inquiries of any governmental officials or other
      persons or entities, or of any public records, other than as expressly stated
      in
      this opinion letter.

     

    6.  This
      opinion letter is rendered to the Buyers in connection with the transactions
      contemplated by the Purchase Agreement and may not be relied on by any Person
      other than the Buyers or by the Buyers in any other context. Accordingly, this
      letter may not be reproduced, delivered to or relied upon by any other Person,
      and it may not be relied upon for any other purpose whatsoever, except that
      it
      may be examined and referred to by counsel for the Buyers.

     

    
      	 	
              Very
                truly yours,

               

              TROY
                & GOULD

              Professional
                Corporation

            

    

    

    

    
      
        
        

      

      
        C
          - 8

        
          

        

      

      
        
        

      

    

    

    

    EXHIBIT
      D

    

    AMENDMENT
      TO BYLAWS

    

    

    [SEE
      EXHIBIT 3.1 OF THE FORM 8-K TO WHICH THIS SECURITIES PURCHASE AGREEMENT IS
      ATTACHED]

     

     

     

     

     

     

     

    
      
        
        

      

      
        D
          - 1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      E

    

    SHAREHOLDER
      AGREEMENT

     

    This
      SHAREHOLDER AGREEMENT (this “Shareholder
      Agreement”)
      is
      made and entered into as of _______ __, 200_ by and between GPS Industries,
      Inc., a Nevada corporation (the “Company”),
      Leisurecorp LLC, a Dubai limited liability company (“Leisurecorp”),
      Great
      White Shark Enterprises, Inc., a Florida corporation (“GWSE”)(GWSE
      and Leisurecorp are herein collectively referred to as the “Investors”),
      Robert C. Silzer, Sr. and Douglas Wood (Mr. Silzer and Mr. Wood are herein
      collectively referred to as the “Conversion
      Shareholders).
      

     

    WHEREAS,
      Leisurecorp, GWSE and the Company have entered into that certain Securities
      Purchase Agreement, dated as of November 13, 2006 (the “Securities
      Purchase Agreement”),
      pursuant to which Leisurecorp and GWSE are acquiring, and may in the future
      acquire, shares of the Company’s newly issued Series B Convertible Preferred
      Stock (the “Preferred
      Stock”),
      and
      warrants to purchase shares of the Company’s common stock (the “Common
      Stock”)
      on the
      terms and subject to the conditions set forth in the Securities Purchase
      Agreement.

     

    WHEREAS,
      the Conversion Shareholders have entered into certain Debt Exchange Agreements
      with the Company pursuant to which Douglas Wood has acquired shares of Preferred
      Stock and warrants to purchase Common Stock, and Robert C. Silzer, Sr. has
      acquired shares of Common Stock and warrants to purchase additional shares
      of
      Common Stock.

     

    WHEREAS,
      the Investors and the Conversion Shareholders, in their capacity as holders
      of
      shares of Preferred Stock and/or Common Stock, agree that it is desirable to
      enter into this Shareholder Agreement.

     

    WHEREAS,
      the Company has determined that it is in its best interests to grant the
      Investors the rights set forth herein.

     

    NOW,
      THEREFORE, in consideration of the premises and other good and valuable
      consideration, the receipt and sufficiency of which is hereby acknowledged,
      the
      parties hereby agree as follows:

     

    1.  REPRESENTATIONS
      AND WARRANTIES. The Company and each of the Investors and the Conversion
      Shareholders (each, a “Shareholder”
and
      collectively, the “Shareholders”)
      hereby
      represents and warrants to the other parties to this Agreement as
      follows:

     

    (a)  Authority;
      Binding Obligation.
      The
      Company and each Shareholder represents and warrants that it has all necessary
      power and authority to enter into this Shareholder Agreement and perform all
      of
      his/its obligations hereunder. This Shareholder Agreement has been duly and
      validly executed and delivered by the Shareholder and constitutes a valid and
      legally binding obligation of the Company and such Shareholder in accordance
      with its terms.

     

    
      
        
        

      

      
        E
          - 1

        
          

        

      

      
        
        

      

       

    

    (b)  Ownership
      of Shares.
      Each
      Shareholder represents and warrants that it is the record holder of the number
      of shares of Preferred Stock, Common Stock and warrants to purchase shares
      of
      Common Stock listed under such Shareholders’ name on the signature page hereto
      (the shares of Preferred Stock and Common Stock listed on the signature page,
      together with shares of Preferred Stock the Investor may acquire under the
      Securities Purchase Agreement and the shares that the Shareholder may acquire
      after the date hereof upon the conversion of the Preferred Stock or the exercise
      of the warrants listed on the signature page, are herein referred to as such
      Shareholders’ “Shares”).
      Each
      Shareholder represents and warrants that it currently has, and will throughout
      the term of the Agreement have sole voting power and sole power of disposition
      over his/its Shares, with no restrictions on the voting rights, rights of
      disposition or otherwise, subject to applicable laws and the terms of this
      Shareholder Agreement. 

     

    (c)  No
      Conflicts.
      The
      Company and each Shareholder represents and warrants that the execution,
      delivery and performance of this Agreement by it/him will not violate or
      conflict with, or result in a breach of any provision of, or constitute a
      default (or an event which with notice or lapse of time or both could become
      a
      default) under any agreement to which the Company or Shareholder is party,
      which
      violation, conflict or breach could prevent such party from fully performing
      its
      obligations under this Agreement in accordance with its terms or affect the
      rights or benefits of any other party to this Agreement. 

     

    2.  VOTING
      AGREEMENT.

     

    (a)  General
      Agreement.
      During
      the term of this Agreement, the Investors agree to vote all of their Shares
      in
      accordance with the provisions of this Agreement. Provided that GWSE receives
      notice from Leisurecorp prior to the time any action is required to be taken
      as
      a shareholder of the Company (at a meeting or by written consent, which notice
      may be oral at a meeting that both Investors attend in person), GWSE hereby
      agrees to vote all of its Shares or to grant consents or approvals in respect
      of
      all of its Shares, in connection with any meeting of the shareholders of the
      Company or any action by written consent in lieu of a meeting of shareholders
      of
      the Company, in accordance with such oral or written instructions of Leisurecorp
      as required above. Notwithstanding the foregoing, GWSE shall not be obligated
      to
      vote or cause to be voted any of GWSE’s Shares in a manner instructed by
      Leisurecorp in a shareholder action involving the election of directors of
      the
      Company except as set forth in Section 2.(b). 

     

    (b)  Election
      of Directors.
      The
      Investors acknowledge and agree that pursuant to the Certificate of Designations
      for the Preferred Stock, the holders of shares of the Preferred Stock have
      the
      right, voting as a separate class, to elect three members of the Company’s Board
      of Directors (the “Preferred
      Directors”).
      During the term of this Agreement, each Investor agrees to vote all of its
      shares of Preferred Stock (whether now owned or hereafter acquired under the
      Securities Purchase Agreement) in such manner as may be necessary to elect
      (and
      maintain in office) as Preferred Directors the following individuals (each
      a
“Designee):

     

    (i)  Two
      persons designated in writing by Leisurecorp (the “Leisurecorp Designees”);
      and

     

    (ii)  One
      person designated in writing by GWSE.

     

    
      
        
        

      

      
        E
          - 2

        
          

        

      

      
        
        

      

       

    

    (c)  Changes
      in Designees.
      From
      time to time during the term of this Agreement, either Leisurecorp or GWSE,
      may
      in its sole discretion:

     

    (i)  notify
      the other Investor in writing of its election to remove from the Company’s Board
      of Directors any incumbent Preferred Director who occupies a Board seat for
      which such stockholder is entitled to designate the Designee; or

     

    (ii)  notify
      the other Investor in writing of its election to select a new Designee for
      election as a Preferred Director for which such stockholders are entitled to
      designate the Designee (whether to replace a prior Designee or to fill a vacancy
      in such Board seat);

     

    (iii)  In
      the
      event of such an initiation of a removal or selection of a Designee under this
      section, the Investors shall take such reasonable actions as are necessary
      to
      facilitate such removals or elections, including, without limitation, voting
      or
      giving consents with respect to all of their shares of Preferred Stock to cause:
      (a) the removal from the Company’s Board of Directors of the Designee or
      Designees so designated for removal; and (b) the election to the Company’s Board
      of Directors of any new Designee or Designees so designated.

     

    (d)  Additional
      Agreements.
      Each of
      GWSE and Leisurecorp covenant and agree that it will not abstain or fail to
      vote
      or give a consent with respect to the Shares to the extent that it has received
      direction from the other in accordance with the terms of this Agreement and
      for
      so long as such Shareholder holds Shares and is subject to this Section 2
      Additionally, the parties covenant and agree that the Leisurecorp Designees
      shall be the Reviewing Preferred Directors.

     

    3.  RESTRICTION
      ON TRANSFER.

     

    (a)  Except
      with the prior written consent of the Investors (or if the proposed transferor
      is an Investor, the other Investor), each Shareholder agrees that it shall
      not
      sell, transfer, assign, convey, gift or otherwise dispose of, whether
      voluntarily or involuntarily by operation of law or otherwise (each, a
“transfer”),
      any
      of its Shares, or to pledge, grant a security interest in or otherwise encumber
      any Shares, except in compliance with this Shareholder Agreement. Any purported
      transfer, pledge, grant of security interest in or other encumbrance of any
      Shares other than in accordance with this Shareholder Agreement shall, in
      addition to constituting a breach of this Shareholder Agreement, be null and
      void and ineffective to convey any interest in such Shares. Nothing in this
      Agreement shall restrict the transfer, pledge, grant of security interest in
      or
      other encumbrance of any other shares of Common Stock any Shareholder owns
      as of
      the date of this Agreement.

     

    (b)  Notwithstanding
      the foregoing, commencing on November 1, 2007, each Shareholder shall have
      the
      right to transfer in any 90 day period, a number of shares of Common Stock
      equal
      to 1% of the number of shares Common Stock listed as outstanding in the
      Company’s latest Form 10-Q or Form 10-K (whichever is filed more recently) (in
      the event of a stock split or other similar event since the filing of the last
      Form 10-Q or Form 10-K, the number of shares that may be sold shall be
      appropriately adjusted to reflect such event). Any portion of such 1% that
      is
      not transferred in any 90-day period shall be carried forward and may be
      transferred hereunder in subsequent periods. Any transfer of Shares permitted
      under this Section 3(b) shall thereafter no longer be subject to
      Section 2 and Section 3 and the other provisions of this Shareholder
      Agreement. 

     

    
      
        
        

      

      
        E
          - 3

        
          

        

      

      
        
        

      

       

    

    (c)  The
      provisions of the Section 3 shall not apply to any transfer of Shares by any
      Shareholder to (a) any constituent partner or member of a Shareholder which
      is a
      partnership or limited liability company, (b) an affiliate of a Shareholder
      which is a corporation, partnership or limited liability company, (c) any
      employee of any Shareholder, or in the case of an individual Shareholder, (d)
      (i) either during his lifetime or upon his death by inter
      vivos trust,
      will or intestacy to his ancestors, descendants or spouse, or to any custodian
      or trustee for the account or benefit of such individual Shareholder or his
      ancestors, descendants or spouse or (ii) to a revocable trust (but not an
      irrevocable trust) established by such individual for the benefit of himself,
      or
      his ancestors, descendants or spouse or (e) with respect to Leisurecorp, to
      Island Global Yachting or any affiliate thereof; provided,
      however,
      that
      the permitted transferee pursuant to subsection (a)-(d) shall receive and hold
      such Shares subject to all of the terms of this Shareholder Agreement. All
      Shares acquired by such affiliated entities or persons from any Shareholder
      (other than Shares held by Island Global Yachting or its affiliate) shall be
      aggregated with those of such Shareholder for the purpose of determining the
      number of shares available for sale under Section 3(b).

     

    (d)  Notwithstanding
      anything to the contrary in this Shareholder Agreement, no transfer of any
      Shares under Section 3(b) or 3(c) may occur (i) unless and until the Company
      and
      the other Shareholders shall have received written notice of the proposed
      transfer setting forth the circumstances and details thereof at least five
      days
      prior to its effectiveness, or (ii) in violation of any of the provisions of
      the
      Securities Act of 1933, as amended, or any applicable state securities
      laws.

     

    (e)  The
      restriction imposed on the transfer, pledge, grant of security interest in
      or
      other encumbrance of Shares under this Section 3 shall terminate on the earlier
      of December 31, 2008 and the listing of the Company’s Common Stock on either the
      Nasdaq Global Market or the Nasdaq Capital Market.

     

    (f)  The
      Company shall not be required to and hereby agrees not (i) to reflect on
      its books any transfer of Shares that shall have been transferred in violation
      of any of the provisions of this Shareholder Agreement or (ii) to treat the
      purported transferee as the owner of such Shares or to accord the purported
      transferee the right to vote such Shares or to receive dividends
      thereon.

     

    4.  BOARD
      OBSERVER RIGHTS. Leisurecorp may, from time to time, notify the Secretary of
      the
      Company in writing of two persons that it has designated as its “Board
      Observers,” and GWSE may, from time to time, notify the Company in writing of
      one person that it has designated as its Board Observer. The foregoing Board
      Observers are in addition to the Preferred Directors that the holders of the
      Preferred Stock are entitled to elect to the Board of Directors under the
      Certificate of Designations. The Company hereby agrees to invite all of the
      Board Observers to attend all meetings (including telephonic meetings) of the
      Board of Directors in a nonvoting capacity and to provide (at the same time
      as
      it provides to the directors) each of the Board Observers copies of all notices,
      consents, Board of Director review materials, and all other materials it
      provides to the directors. 

     

    
      
        
        

      

      
        E
          - 4

        
          

        

      

      
        
        

      

       

    

    5.  COVENANTS
      OF THE COMPANY. The Company agrees to use its best efforts to ensure that the
      rights given to the Shareholders hereunder are effective and that the
      Shareholders enjoy the benefits thereof. Such actions include, without
      limitation, the use of the Company’s reasonable best efforts to enforce the
      terms of this Shareholder Agreement and to inform the shareholders of any breach
      hereof (to the extent the Company has knowledge thereof). The Company will
      not,
      by any voluntary action, avoid or seek to avoid the observance or performance
      of
      any of the terms to be performed hereunder by the Company, but will at all
      times
      in good faith assist in the carrying out of all of the provisions of this
      Shareholder Agreement and assist the Shareholders in the exercise and
      enforcement of their rights and the performance of their obligations hereunder.
      

     

    6.  SPECIFIC
      PERFORMANCE. The Investors acknowledge that it would be impossible to determine
      the amount of damages that would result from any breach of any of their
      obligations under Section 2 of this Shareholder Agreement and that the remedy
      at
      law for any breach, or threatened breach, would likely be inadequate and,
      accordingly, agrees that the other Investors shall, in addition to any other
      rights or remedies which it may have at law or in equity, be entitled to seek
      such equitable and injunctive relief as may be available from any court of
      competent jurisdiction to restrain an Investor from violating any of its
      obligations under Section 2. In connection with any action or proceeding for
      such equitable or injunctive relief, each Investors hereby waives any claim
      or
      defense that a remedy at law alone is adequate and agrees, to the maximum extent
      permitted by law, to have its obligations under Section 2 specifically enforced
      against it, without the necessity of posting bond or other security, and
      consents to the entry of equitable or injunctive relief against it enjoining
      or
      restraining any breach or threatened breach of Section 2 of this Shareholder
      Agreement.

     

    7.  EXPIRATION;
      TERMINATION. Except as otherwise set forth in this Agreement, this Shareholder
      Agreement shall terminate upon the earliest to occur of the following:
      (i) the written agreement of the Investors; (ii) the dissolution,
      bankruptcy or insolvency of the Company; (iii) at such time as Leisurecorp
      owns less than 25% of the number of shares of Preferred Stock that it purchased
      under the Securities Purchase Agreement; (iv) the consummation by the
      Company of the sale of all or substantially all of its assets and business;
      (v) the consummation of a merger or consolidation of the Company with or
      into a third party (other than a reincorporation merger) in which the Preferred
      Stock is converted into the right to receive cash, securities or other
      consideration; and (vi) December 31,
      2009. 

     

    8.  MISCELLANEOUS.

     

    (a)  Legend
      on Share Certificates.
      Each
      certificate representing any Shares (including shares issued after the date
      hereof) , and all certificates issued in transfer thereof or substitution
      therefor, shall be endorsed by the Company with a legend reading substantially
      as follows:

     

    “THE
      SHARES EVIDENCED HEREBY ARE SUBJECT TO A SHAREHOLDER AGREEMENT, AS MAY BE
      AMENDED FROM TIME TO TIME, (A COPY OF WHICH MAY BE OBTAINED UPON WRITTEN REQUEST
      FROM THE COMPANY), AND BY ACCEPTING ANY INTEREST IN SUCH SHARES THE PERSON
      ACCEPTING SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND
      BY
      ALL THE PROVISIONS OF THAT SHAREHOLDER AGREEMENT, INCLUDING CERTAIN RESTRICTIONS
      ON VOTING, TRANSFER AND OWNERSHIP SET FORTH THEREIN.”

     

    
      
        
        

      

      
        E
          - 5

        
          

        

      

      
        
        

      

       

    

    (b)  Entire
      Agreement.
      This
      Shareholder Agreement constitutes the entire agreement of the parties hereto
      with reference to the transactions contemplated hereby and supersedes all other
      prior agreements, understandings, representations and warranties, both written
      and oral, between the parties or their respective representatives, agents or
      attorneys, with respect to the subject matter hereof.

     

    (c)  Parties
      in Interest.
      This
      Shareholder Agreement shall be binding upon and inure solely to the benefit
      of
      the Investors and their respective successors, assigns, and other legal
      representatives, as the case may be. Nothing in this Shareholder Agreement,
      express or implied, is intended to confer upon any other person, other than
      the
      Investors or their respective successors, assigns, and other legal
      representatives, as the case may be, any rights, remedies, obligations or
      liabilities under or by reason of this Shareholder Agreement.

     

    (d)  Assignment.
      This
      Shareholder Agreement shall not be assignable by law or otherwise without the
      prior written consent of the other parties hereto; provided, however, that
      either GWSE or Leisurecorp may assign any of its rights and obligations
      hereunder to any entity which may acquire all or substantially all of its
      assets, shares or business or to any entity with or into which it may be
      consolidated or merged.

     

    (e)  Modifications;
      Waivers.
      This
      Shareholder Agreement shall not be amended, altered or modified in any manner
      whatsoever, except by a written instrument executed by the Company and by both
      Investors. No waiver of any breach or default hereunder shall be considered
      valid unless in writing and signed by the party giving such waiver, and no
      such
      waiver shall be deemed a waiver of any subsequent breach of the same or similar
      nature.

     

    (f)  Severability.
      Any
      term or provision of this Shareholder Agreement which is invalid or
      unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
      to the extent of such invalidity and unenforceability without rendering invalid
      or unenforceable the remaining terms and provisions of this Shareholder
      Agreement in any other jurisdiction. If any provision of this Shareholder
      Agreement is so broad as to be unenforceable, the provision shall be interpreted
      to be only so broad as is enforceable.

     

    (g)  Governing
      Law.
      This
      Shareholder Agreement shall be deemed to be made in and in all respects shall
      be
      interpreted, construed and governed by and in accordance with the laws of the
      State of New York, without regard to the conflict of law principles
      thereof.

     

    (h)  Jurisdiction
      and Venue.
      Each
      party hereby irrevocably submits to the exclusive jurisdiction of the state
      and
      federal courts sitting in The City of New York, Borough of Manhattan, for the
      adjudication of any dispute hereunder or in connection herewith or with any
      transaction contemplated hereby or discussed herein, and hereby irrevocably
      waives, and agrees not to assert in any suit, action or proceeding, any claim
      that it is not personally subject to the jurisdiction of any such court, that
      such suit, action or proceeding is brought in an inconvenient forum or that
      the
      venue of such suit, action or proceeding is improper.

     

    
      
        
        

      

      
        E
          - 6

        
          

        

      

      
        
        

      

       

    

    (i)  Attorney’s
      Fees.
      The
      prevailing party in any litigation, arbitration, mediation, bankruptcy,
      insolvency or other proceeding (“Proceeding”)
      relating to the enforcement or interpretation of this Shareholder Agreement
      may
      recover from the unsuccessful party all fees and disbursements of counsel
      (including expert witness and other consultants’ fees and costs) relating to or
      arising out of (a) the Proceeding (whether or not the Proceeding results in
      a judgment) and (b) any post-judgment or post-award Proceeding including,
      without limitation, one to enforce or collect any judgment or award resulting
      from any Proceeding. All such judgments and awards shall contain a specific
      provision for the recovery of all such subsequently incurred costs, expenses,
      fees and disbursements of counsel.

     

    (j)  Counterparts.
      This
      Shareholder Agreement may be executed in one or more counterparts (including
      by
      facsimile), each of which shall be deemed to be an original, but all of which
      shall constitute one and the same instrument.

     

    (k)  Notices.
      All
      notices, requests, instructions and other communications to be given hereunder
      by any party to the other shall be in writing and shall be deemed given if
      personally delivered, telecopied (with confirmation) or mailed by registered
      or
      certified mail, postage prepaid (return receipt requested), to such party at
      its
      address set forth below or such other address as such party may specify to
      the
      other party by notice provided in accordance with this Section
      7(k).

     

    If
      to the
      Company, to:

     

    GPS
      Industries, Inc.

    Suite
      214

    5500
      152nd Street

    Surrey,
      British Columbia

    Canada
      V35 S59

    Attn:
      Chief Executive Officer

    Telecopier:
      (604) 576-7460

     

    and

     

    If
      to
      Shareholders, to the addresses specified on the signature page
      hereof.

     

    (l)  Advice
      of Counsel.
      Each
      Shareholder acknowledges that, in executing this Shareholder Agreement, such
      Shareholder has had the opportunity to seek the advice of independent legal
      counsel, and has read and understood all of the terms and provisions of this
      Shareholder Agreement. The parties acknowledge that the Company’s counsel, Troy
      Gould Professional Corporation (“Troy
      & Gould”),
      prepared this Shareholder Agreement on behalf of and in the course of its
      representation of the Company. Troy & Gould represents the Company only, and
      does not represent, and owes no duty, to any of the Shareholders. Troy &
Gould has therefore advised the Shareholders to seek the advice of independent
      counsel with respect to this Shareholder Agreement.

     

    (m)  Actions
      as Shareholders.
      The
      Investors and the Conversion Shareholders are entering into this Shareholder
      Agreement in their capacity as the record or beneficial owners of the shares
      of
      the Company’s securities. Nothing in this Shareholder Agreement shall be deemed
      in any manner to limit the discretion of any member of the Company’s Board of
      Directors, including either Conversion Shareholders or any affiliate or designee
      of either Investors, to take any action, or fail to take any action, in his
      or
      her capacity as a director or officer of the Company

     

    
      
        
        

      

      
        E
          - 7

        
          

        

      

      
        
        

      

       

    

    IN
      WITNESS WHEREOF, the parties hereto have executed this Shareholder Agreement
      as
      of the date first above written.

     

    GPS
      INDUSTRIES, INC.

     

    By:_____________________________

    Name:
      

    Title:
       

     

     

    SHAREHOLDERS:

     

    GREAT
      WHITE SHARK ENTERPRISES, INC.

    

    

    _____________________________________

    By:

    Number
      of
      shares of Preferred Stock as of the date of this Agreement: 574,089

    Number
      of
      shares underlying warrants as of the date of this Agreement:
      18,901,579

    

     

    Address
      for Notices:

     

    Great
      White Shark Enterprises, Inc.

    501
      North
      A1A, Jupiter, FL 33477

    Attn:
      Bart Collins

    Telephone:
      (561) 743-8818

    Telecopy:
      (561) 743-8831

    

     

    LEISURECORP
      LLC

    

    

    _____________________________________

    By:

    Number
      of
      shares of Preferred Stock as of the date of this Agreement:
      1,000,000

    Number
      of
      shares underlying warrants as of the date of this Agreement:
      40,983,607

    

     

    Address
      for Notices:

     

    David
      Spencer 

    Chief
      Executive Officer 

    Istithmar
      Leisure 

    P.O.
      Box
      17000, Dubai, UAE 

    Telephone:
      +9714-3687630 

    Telecopy:
      +9714-3687654

    

    
      
        
        

      

      
        E
          - 8

        
          

        

      

      
        
        

      

       

    

    ROBERT
      C.
      SILZER, SR.

    

    

    _____________________________________

    By:
      Robert C. Silzer, Sr.

    Number
      of
      shares of Common Stock subject to this Agreement: 12,295,082

    Number
      of
      shares underlying warrants as of the date of this Agreement:
      3,073,770

    

     

    Address
      for Notices:

     

    GPS
      Industries, Inc., Suite 214

    5500
      152nd Street

    Surrey,
      British Columbia

    Canada
      V35 S59

    

    

    DOUGLAS
      WOOD

    

    

    _____________________________________

    By:
      Douglas Wood

    Number
      of
      shares of Preferred Stock as of the date of this Agreement: 300,000

    Number
      of
      shares underlying warrants as of the date of this Agreement:
      12,295,082

    

     

    Address
      for Notices:

     

    D.
      Wood
      Holdings LLC

    1001
      Courtyard Plaza,

    Latrobe,
      Pennsylvania 15650

    

     

    
      
        
        

      

      
        E
          - 9

        
          

        

      

      
        
        

      

    

    
 

    EXHIBIT
      F

    

    

    (1)
      Indebtedness to be cancelled and exchanged for Preferred Shares Warrants under
      Article I.B:

    

    Great
      White Shark Enterprises, Inc.:

     

    
      	·   
                	
              $3
                million Term Loan from GWSE dated December 3, 2004.
                

            

    

    Balance
      outstanding = $2,454,166

    
      	·   
                	
              Short
                term loan from GWSE, March 1, 2005 plus accumulated interest =
                $567,902

            

    

    
      	·   
                	
              Interest
                on $3M loan & quarterly royalties =
                $115,319

            

    

    
      	·   
                	
              Royalty
                payments = $875,000

            

    

    
      	·   
                	
              Sundry
                accounts payable = $16,741

            

    

    

    Total
      amount owed to GWSE = $4,029,128

    

    Total
      amount of debt to be converted into Series B Preferred Shares =
      $2,740,892

    

    Balance
      of remaining outstanding debt owed to GWSE = $1,288,236

    

    

    (2)
      Indebtedness to be cancelled and exchanged for Preferred Shares and Warrants
      pursuant to Article VII.F:

    

    Douglas
      Wood:

     

    
      	·   
                	
              Short
                term working capital loans, amounting to
                $5,147,165

            

    

    
      	·   
                	
              Interest
                accrued on such loans, amounting to
                $313,449

            

    

    

    Total
      amount owed to Douglas Wood on short term working capital loans =
      $5,460,614

    

    Total
      amount of debt to be converted into Series B Preferred Shares and Warrants=
      $3,000,000

    

    Robert
      C.
      Silzer, Sr.: 

    

    
      	· 
                	
              Promissory
                note = $471,560

            

    

    
      	· 
                	
              Short
                term loan = $12,869

            

    

    
      	· 
                	
              Vacation
                Pay = $140,483

            

    

    
      	· 
                	
              Accrued
                Interest = $158,928

            

    

    

    Total
      amount owed to Robert C. Silzer Sr. = $783,840

    

    Total
      amount of debt to be converted into shares of common stock and warrants =
      $750,000

     

    
      
        
        

      

      
        F
          - 1

        
          

        

      

      
        
        

      

    

    EXHIBIT
      G

    

    DEBT
      EXCHANGE AGREEMENT

     

    This
      Debt
      Exchange Agreement (this “Agreement”) is entered into as of ________ , 2006, by
      and between GPS Industries, Inc., a Nevada corporation (the “Company”), and the
      undersigned lender (the “Lender”).

     

    WHEREAS,
      the Company is indebted to the Lender in the amount set forth on Exhibit A,
      which indebtedness arose from those loans and other transactions listed on
      Exhibit A (collectively, the “Indebtedness”). 

     

    WHEREAS,
      the Company intends to establish a new series of its preferred stock to be
      designated as its Series B Convertible Preferred Stock (the “Series B Preferred
      Stock”) which Series B Preferred Stock shall have the rights, preferences and
      privileges set forth in the “GPS Industries, Inc. Certificate of Designation of
      the Series B Convertible Preferred Stock” (the form of which is attached hereto
      as Exhibit B); and

     

    WHEREAS,
      the Company intends to sell both shares of its Series B Preferred Stock and
      warrants to purchase common stock (the “Warrants”) to investors in a private
      placement (the “Private Placement”); and 

     

    WHEREAS,
      as a condition of the Private Placement, the Indebtedness is required to be
      cancelled and converted into or exchanged for the Company’s securities; and

     

    WHEREAS,
      the Board of Directors of the Company has determined that it is in the best
      interests of the Company and its stockholders that the Indebtedness be exchanged
      by the Lender thereof prior to the scheduled repayment date of the Indebtedness;
      and

     

    WHEREAS,
      to induce the Lender to convert its Indebtedness, the Company has offered to
      issue to the Lender (i) one share of Series B Preferred Stock and a Warrant
      to
      purchase 40.98361 shares of the Company’s common stock in exchange for (ii) each
      $10.00 of Indebtedness that is cancelled and converted; and

     

    WHEREAS,
      the Lender wishes to accept this offer and to so exchange or convert its
      Indebtedness into shares of Series B Preferred Stock and Warrants upon the
      foregoing terms.

     

    NOW
      THEREFORE, for good and valuable consideration, the receipt and sufficiency
      of
      which is hereby acknowledged, the parties hereto, intending to be legally bound,
      hereby agree as follows:

     

    1.  Conditioned
      on the closing of the Private Placement, the Lender hereby agrees to convert
      or
      exchange the entire balance of the Indebtedness into ___________ shares of
      Series B Preferred Stock and Warrants to purchase _______ shares of common
      stock
      (collectively, the “Conversion Securities”). The conversion or exchange of the
      Indebtedness into Conversion Securities shall become effective concurrently
      with
      the closing of the Private Placement. Promptly following the date hereof, but
      in
      any event prior to the conversion or exchange, the Lender agrees to return
      all
      evidences its Indebtedness to the Company for cancellation (provided that the
      Lender’s failure to do so shall in no way effect the status of its Indebtedness
      as being canceled). The Lender’s agreement to convert and cancel its
      Indebtedness shall expire if the closing of the Private Placement has not
      occurred by the close of business on March 31, 2007.

     

    
      
        
        

      

      
        G
          - 1

        
          

        

      

      
        
        

      

       

    

    2.  The
      Company hereby agrees to issue the Conversion Securities to the Lender as a
      result of such conversion, and the Lender agrees to accept the Conversion
      Securities as payment in full for the Indebtedness. The Company agrees to
      deliver to the Lender the stock certificate and warrant agreement that evidence
      the Conversion Securities promptly after the closing of the Private
      Placement.

     

    3.  The
      Lender is an “accredited investor” within the meaning of Regulation D
      promulgated under the Securities Act of 1933, as amended (the “Act”). The Lender
      has a preexisting personal or business relationship with the Company or one or
      more of its officers or control persons. By reason of the Lender’s business or
      financial experience, or by reason of the business or financial experience
      of
      the Lender’s financial advisor who is unaffiliated with and who is not
      compensated, directly or indirectly, by the Company, the Lender is capable
      of
      evaluating the risks and merits of converting its Indebtedness on the terms
      set
      forth herein and of protecting the Lender’s own interests in connection
      therewith.

     

    4.  The
      Conversion Securities and the shares of the Company’s Common Stock issuable upon
      conversion thereof are being acquired for the Lender’s own account, not as a
      nominee or agent, and not with a view to or in connection with the sale or
      distribution of any part thereof.

     

    5.  The
      Lender understands that the issuance of the Conversion Securities upon
      conversion of its Indebtedness will not be registered under the Act on the
      grounds that such issuance is exempt from registration under the Act, and that
      the reliance of the Company on such exemption is predicated in part on the
      Lender’s representations set forth in this Agreement. The Lender understands
      that the Conversion Securities and the shares of the Company’s Common Stock
      issuable upon conversion or exercise thereof are restricted securities within
      the meaning of Rule 144 under the Act, and must be held indefinitely unless
      they
      are subsequently registered or an exemption from such registration is
      available.

     

    6.  The
      Lender acknowledges that it has had an opportunity to discuss the terms of
      the
      Private Placement and the business, affairs and current prospects of the Company
      with its officers. The Lender further acknowledges having had access to
      information about the Company that it has requested.

     

    7.  The
      Lender represents and warrants to the Company that it owns its Indebtedness
      free
      and clear of any liens and has the right to exchange its Indebtedness and accept
      the Conversion Securities as payment in full of the entire Indebtedness without
      the consent of any other person. 

     

    
      
        
        

      

      
        G
          - 2

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, and intending to be legally bound hereby, the undersigned
      have
      entered into this Agreement as of the date set forth above. 

     

     

    
      	 	
              THE
                COMPANY:

              GPS
                INDUSTRIES, INC.

            
	 	 
	 	 
	 	
              By:

            	 
	
            	
              Name:

            	 
	 	
              Title:

            	 
	 	 
	 	 
	 	
              THE
                LENDER:

            
	 	 
	 	 
	 	
              Name

            

    

    

     

    
      
        
        

      

      
        G
          - 3

        
          

        

      

      
        
        

      

       

    

    EXHIBIT
      A

     

    Indebtedness:
      

     

    1.     Promissory
      Note, dated ______, in the principal amount of $_______

     

    2.     Accrued
      and unpaid interest through the date hereof on the Promissory Note:
      $_______

     

    3.     [describe
      any other indebtedness...]

     

     

     

    
 

    
      
        
        

      

      
        G
          - 4

        
          

        

      

      
        
        

      

    

    EXHIBIT
      H

    

    AGREEMENT

    

    

    [SEE
      EXHIBIT 10.4 OF THE FORM 8-K TO WHICH THIS SECURITIES PURCHASE AGREEMENT IS
      ATTACHED]

     

     

     

     

     

     

     

    
      
        
        

      

      
        H
          -
          1

        
          

        

      

      
        
        

      

       

    

    DISCLOSURE
      SCHEDULES

     

    These
      disclosure schedules (these “Schedules”) are furnished by GPS Industries, Inc.,
      a Nevada corporation (the “Company”), pursuant to the Securities Purchase
      Agreement dated as of November 13, 2006 (the “Purchase Agreement”), by and among
      the Company and the Buyers identified on the signatures pages
      thereto.

     

    Nothing
      in the Schedules constitutes an admission of any liability or obligation of
      the
      Company to any third party, nor an admission to any third party against the
      Company’s interests. Unless otherwise stated, all statements made herein are
      made as of the date of execution of the Purchase Agreement. The Schedules are
      qualified in their entirety by reference to specific provisions of the Purchase
      Agreement. The disclosures in these Schedules are deemed disclosures against
      the
      representations and warranties in the section of the Purchase Agreement to
      which
      they expressly relate and to no other representation or warranty in the Purchase
      Agreement.

     

    The
      representations and warranties made by the Company in the Purchase Agreement
      are
      qualified by, and subject to the exceptions noted in, the information set forth
      in these Schedules. The inclusion or disclosure of any item or information
      in
      the Schedules shall not be construed as an admission that such item or
      information is material to the Company, and any inclusion in the Schedules
      shall
      expressly not be deemed to constitute an admission, or otherwise imply, that
      any
      such item or information is material or creates measures for materiality for
      the
      purposes of the Purchase Agreement.

     

    Headings
      have been inserted on the sections of the Schedules for convenience of reference
      only and shall to no extent have the effect of amending or changing the express
      description of the sections as set forth in the Purchase Agreement. Capitalized
      terms used herein but not otherwise defined shall have the meanings set forth
      in
      the Purchase Agreement.

     

    Schedule
      C
      Capitalization

     

    (i) Warrants
      to purchase 26,200,907 shares of Common Stock are currently issued and
      outstanding.

     

    Subject
      to certain conditions, the Company has agreed to issue to the shareholders
      of
      Optimal Golf Solutions warrants to purchase 4,000,000 shares of Common Stock
      on
      April 1, 2007. In addition, in connection with the purchase of Optimal Golf
      Solutions, Inc. in November 2004, the Company agreed to issue to the sellers
      a
      total of 40,000,000 shares of Common Stock, of which 30,392,082 shares still
      must be issued. The foregoing 30,392,082 shares are included in the number
      of
      shares issued and outstanding immediately after the transactions contemplated
      by
      this Agreement in Article III.C.(ii).

     

    As
      described in Article IV, J, the Company has agreed to grant the NIR Group
      warrants to purchase 3,000,000 shares of Common Stock, which warrants shall
      have
      an exercise price of $0.122 per share.

     

    
      
        
        

      

      
        H
          - 2

        
          

        

      

      
        
        

      

       

    

    The
      Company has entered into an arrangement with GWSE (the “GWSE Purchase Order
      Facility”) for purchase order inventory financing whereby GWSE advances funds on
      signed purchase orders, secured by the contract inventory and receivable. These
      advances bear interest at 18% per annum. In addition, as additional
      consideration for the advances, the Company has agreed to issue to GWSE shares
      of Common Stock at the rate of 100,000 shares per $250,000 advanced, adjusted
      proportionately for the actual contract advance. As of October 31, 2006, the
      Company was committed to issue 394,104 shares under this arrangement, although
      the actual issuances will not take place until the repayment of the advances.
      

     

    On
      November 5, 2006 the Company was notified that its obligation to pay $2,000
      of
      fees for services rendered to an advisor involved in the recent UK patent
      litigation has become due and owing. Accordingly, the Company is obligated
      to
      issue shares for the $2,000 obligation, by issuing 32,258 shares at a price
      of
      $0.062 per share. 

     

    

    
      
        
        

      

      
        H
          - 3

        
          

        

      

      
        
        

      

    

     

    (ii)
       The
      following warrants and options will be outstanding immediately following the
      Closing:

     

    
      	
              Outstanding
                Warrants

            	 	
              Expiry
                Date

            	 	
              Exercise

              Price

            	 	
              Number
                of 

              Shares

            	 
	
              Convertible
                Preferred Series A

            	 	 	 	 	 	 	 	 	 	 
	
              -
                Warrant conversion, 3yr term

            	 	 	
              Expires
                Aug 3 2007

            	 	
              $

            	
              0.167

            	 	 	
              880,281
                

            	 
	
              -
                Warrant conversion 3yr term

            	 	 	
              Expires
                Oct 27, 2007

            	 	
              $

            	
              0.124

            	 	 	
              592,978
                

            	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Other
                Warrants

            	 	 	 	 	 	 	 	 	 	 
	
              Cameron
                L. Truesdell Warrants For $200,000 Common Shares

            	 	 	 	 	 	 
	
              2,857,143
                common shs x .25%

            	 	 	
              Expires
                Aug 24, 2007

            	 	
              $

            	
              0.10

            	 	 	
              714,285
                

            	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Shaar
                Fund 

            	 	 	
              Expires
                Oct 29, 2007

            	 	
              $

            	
              0.32

            	 	 	
              200,000
                

            	 
	
              Hansen
                Inc.

            	 	 	
              Expires
                Jun/08

            	 	
              $

            	
              0.05

            	 	 	
              1,000,000
                

            	 
	
              Hansen
                Inc. - Dec. 27, 2004 LOC renewal

            	 	 	
              Expires
                Dec/09

            	 	
              $

            	
              0.05

            	 	 	
              500,000
                

            	 
	
              Hansen
                Inc. - March 14, 2005 LOC renewal

            	 	 	
              Expires
                Mar/08

            	 	
              $

            	
              0.10

            	 	 	
              1,000,000
                

            	 
	
              Hansen
                Inc. - October 2005 LOC renewal

            	 	 	
              Expires
                Sep/08

            	 	
              $

            	
              0.10

            	 	 	
              1,000,000
                

            	 
	
              Windsor
                Capital Finance

            	 	 	
              Expires
                Mar/07

            	 	
              $

            	
              0.06

            	 	 	
              250,000

            	 
	
              Windsor
                Capital Finance

            	 	 	
              Expires
                Mar/07

            	 	
              $

            	
              0.07

            	 	 	
              250,000

            	 
	
              Doug
                Wood

            	 	 	
              Expires
                March 23/07

            	 	
              $

            	
              0.15

            	 	 	
              666,667

            	 
	
              Norton
                Lane Advisors

            	 	 	
              Expires
                May 3, 2008

            	 	
              $

            	
              0.20

            	 	 	
              2,250,000

            	 
	
              Norton
                Lane Advisors 

            	 	 	
              Expires
                May 3, 2008

            	 	
              $

            	
              0.30

            	 	 	
              2,350,000

            	 
	
              JMS
                Capital Investors With Warrants

            	 	 	 	 	 	 	 	 	 	 
	
              Tim
                Gee warrant

            	 	 	
              Expires
                Jan/07

            	 	
              $

            	
              0.15

            	 	 	
              500,000
                

            	 
	
              Vicki
                Holom warrant

            	 	 	
              Expires
                Apr/07

            	 	
              $

            	
              0.15

            	 	 	
              250,000
                

            	 
	
              WWG
                Trust #13

            	 	 	
              Expires
                Dec/07

            	 	
              $

            	
              0.15

            	 	 	
              500,000
                

            	 
	
              Great
                White Shark Enterprises Loan For $3,000,000

            	 	 	 	 	 	 

    

     

    
      
        
        

      

      
        H
          -
          4

        
          

        

      

      
        
        

      

    

     

    
      	
              Warrants
                Owing Per Agmt, 3 Yr Term

            	 	 	
              Expires
                Dec/07

            	 	
              $

            	
              0.15

            	 	 	
              2,000,000
                

            	 
	
              3
                Year Warrants issued to Agent Demetrios Tsouvelekakis

            	 	 	
              Expires
                Jun/08

            	 	
              $

            	
              0.25

            	 	 	
              2,187,500
                

            	 
	
              3
                Year Warrants issued to Agent Blue Capital Inc.

            	 	 	
              Expires
                Jun/08

            	 	
              $

            	
              0.18

            	 	 	
              1,640,625
                

            	 
	
              3
                Year Warrants issued to Agent Blue Capital Inc.

            	 	 	
              Expires
                Jun/08

            	 	
              $

            	
              0.12

            	 	 	
              928,571
                

            	 
	
              3
                Year Warrants issued to Lionheart Associates

            	 	 	
              Expires
                Sep/08

            	 	
              $

            	
              0.25

            	 	 	
              324,000
                

            	 
	
              3
                Year Warrants issued to Ocean Avenue Advisors

            	 	 	
              Expires
                Sep/08

            	 	
              $

            	
              0.25

            	 	 	
              216,000
                

            	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              NIR
                Warrants @ $0.25 (Subject to Anti-dilution
                provisions)

            	 	 	 	 	 	 
	
              -
                1st Tranche

            	 	 	
              Expires
                Sep 20, 2010

            	 	
              $

            	
              0.25

            	 	 	
              3,000,000

            	 
	
              -
                2nd Tranche

            	 	 	
              Expires
                Oct 28, 2010

            	 	
              $

            	
              0.25

            	 	 	
              1,500,000

            	 
	
              -
                3rd Tranche

            	 	 	
              Expires
                Dec 9, 2010

            	 	
              $

            	
              0.25

            	 	 	
              1,500,000

            	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Total
                Outstanding Warrants

            	 	 	 	 	 	 	 	 	
              26,200,907

            	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Stock
                Options Outstanding

            	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Issued
                Oct. 10, 2003

            	 	 	
              630,000

            	 	
              $

            	
              0.100

            	 	 	 	 
	
              Issued
                Dec 21, 2005

            	 	 	
              5,860,000

            	 	
              $

            	
              0.05
                - $0.08

            	 	 	 	 
	
              Issued
                September 2006

            	 	 	
              1,700,000

            	 	
              $

            	
              0.05
                - $0.07

            	 	 	 	 
	
              Issued
                October 2006

            	 	 	
              15,000,000

            	 	 	
              0.061

            	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	
              Total
                Outstanding Options

            	 	 	 	 	 	 	 	 	
              23,190,000

            	 

    

    

    In
      addition to the outstanding warrants listed in the above table, as part of
      the
      NIR Group Settlement Agreement, the Company has agreed to issued to the NIR
      Group warrants to purchase 3,000,000 shares of Common Stock at an exercise
      price
      of $0.122 per share (see, Article III.Z).

     

    Subject
      to certain conditions, the Company has agreed issue to the shareholders of
      Optimal Golf Solutions warrants to purchase 4,000,000 shares of Common Stock
      on
      April 1, 2007.

     

    
      
        
        

      

      
        H
          -
          5

        
          

        

      

      
        
        

      

       

    

    Schedule
      HTax
      Status

     

    The
      Company has not filed tax returns in Canada. The Company has accumulated
      significant losses in Canada and does not believe there is any amount payable
      to
      the Canadian tax authorities.

    

    The
      Company has filed all applicable US federal tax returns except its 2005 U.S.
      federal tax return which was due on September 15, 2006. The return has been
      prepared and is expected to be filed in November 2006. The Company does not
      believe there is any liability or amount payable to the U.S. federal tax
      authorities as the Company did not generate any federal taxable income in 2005.
      

    

    The
      Company is currently in arrears in remitting payroll withholding amounts to
      the
      Canadian tax authorities. The amount of withholdings overdue for remittance
      amounts to Cdn$284,530. There are additional penalty and interest amounts due
      on
      these remittances amounting to approximately Cdn$62,000. The payroll
      withholdings incur the penalty on late payment and interest at the rate of
      8%
      per annum until paid. Once the withholdings, penalties and interest are paid
      there are no further consequences. Unless the Company obtains the consent of
      the
      Canada Revenue Agency to defer some portion of the amount owed, the Company
      intends to pay the entire balance of unpaid withholding amounts, plus penalties
      and interest, upon the receipt of funds from the $6,500,000 bridge loan obtained
      from the Buyers.

    

     

    Schedule
      NNo
      Brokers

     

    The
      Company is a party to a letter agreement, dated January 18, 2006, with TM
      Capital Corp. (“TM Capital”) pursuant to which the Company has agreed to pay TM
      Capital Corp a cash fee of $200,000 at the closing of a financing arranged
      exclusively with Great White Shark Enterprises or its affiliates and/or a group
      of Dubai based investors with which the Company had previous
      discussions.

     

    Schedule
      YIndebtedness

     

    (1) Indebtedness
      as of October 31, 2006

     

    
      	 	 	 	 
	
              Short
                Term Loans:

            	 	
              $

            	
            	 
	
              Doug
                Wood

            	 	 	
              5,147,165
                

            	 
	
              Blue
                & Gold Ventures

            	 	 	
              465,000
                

            	 
	
              Synapse
                Ventures - Julius Farkas

            	 	 	
              107,241
                

            	 
	
              Optimal
                Golf Solution - GWSE

            	 	 	
              286,726
                

            	 
	
              Daniel
                Wood

            	 	 	
              85,000
                

            	 
	
              Hansen
                Inc.

            	 	 	
              100,000
                

            	 

    

     

    
      
        
        

      

      
        H
          -
          6

        
          

        

      

      
        
        

      

    

     

    
      	 	 	 	 	 
	
              Accrued
                Interest:

            	 	 	 	 
	
              Bob
                Silzer

            	 	 	
              158,929
                

            	 
	
              Synapse
                Ventures - Julius Farkas

            	 	 	
              112,378
                

            	 
	
              Doug
                Wood

            	 	 	
              313,449
                

            	 
	
              Manufacturing
                Line of Credit

            	 	 	
              237,732
                

            	 
	
              GWSE:
                Interest on 125,000 payments

            	 	 	
              82,500
                

            	 
	
              Optimal
                Shareholders - Patent Purchase o/s balance

            	 	 	
              350,589
                

            	 
	
              GWSE
                Interest on short term loan

            	 	 	
              286,726
                

            	 
	
              Blue
                & Gold Ventures 

            	 	 	
              203,567
                

            	 
	 	 	 	 	 
	
              Miscellaneous
                Accruals:

            	 	 	 	 
	
              Sherb                      
                    Audit

            	 	 	
              120,000
                

            	 
	
              Bob
                Silzer Accrual of past vacation pay earned 

            	 	 	
              140,483
                

            	 
	
              Horrow
                Sports

            	 	 	
              66,545
                

            	 
	
              Troy
                & Gould PC

            	 	 	
              100,000
                

            	 
	
              Revenue
                Canada                         
                    Payroll
                Remittances

            	 	 	
              284,530
                

            	 
	
              Revenue
                Canada                          
                   Penalties
                & Interest

            	 	 	
              60,968
                

            	 
	
              Rouse
                Legal                        
                 Unbilled
                fees and expenses

            	 	 	
              80,697
                

            	 
	 	 	 	 	 
	
              Bank
                Indebtedness:

            	 	 	 	 
	
              Hansen
                Line of Credit

            	 	 	
              1,500,000
                

            	 
	
              Manufacturing
                Line of Credit

            	 	 	
              1,400,000
                

            	 
	 	 	 	 	 
	
              Long
                Term Loan: Robert Silzer Sr.

            	 	 	
              471,414
                

            	 
	 	 	 	 	 
	
              Purchase
                Order Financing Loans

            	 	 	 	 
	
              Through
                GWSE

            	 	 	
              857,368
                

            	 
	 	 	 	 	 
	
              Liability
                Associated with Optimal Golf Acquisition

            	 	 	
              2,948,725
                

            	 
	 	 	 	 	 
	 	 	 	 	 
	
              Term
                Loan from GWSE

            	 	 	
              2,454,166
                

            	 
	 	 	 	 	 
	
              NIR
                Convertible Debt

            	 	 	
              2,599,820
                

            	 
	 	 	 	 	 
	
              Present
                Value of Real Estate Leases

            	 	 	
              100,513
                

            	 
	 	 	 	 	 
	
              Miscellaneous
                items less than $50,000

            	 	 	
              151,478
                

            	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	
              $

            	
              21,273,710

            	 

    

     

    (2) Indebtedness
      incurred since October 31, 2006.

     

    $395,000
      of additional advances under the GWSE Purchase Order Facility to fund inventory
      purchases for new purchase orders the Company has received.

     

    $300,000
      under a short-term, unsecured loan from James Liken to fund the payment
      currently due to the shareholders of Optimal Golf Solutions, Inc. The loan
      from
      Mr. Liken bears interest at a rate of 12% per annum and is required to be repaid
      in cash from the proceeds of the $6,500,000 bridge loan obtained from the
      Buyers.

     

    
      
        
        

      

      
        H
          -
          7EXHIBIT
      10.2

     

    REGISTRATION
      RIGHTS AGREEMENT

     

    THIS
      REGISTRATION RIGHTS AGREEMENT
      (this
“Agreement”) is entered into as of the ____ day of_________, 200_, by
      and among GPS Industries, Inc., a Nevada corporation (the “Company”), and the
      persons set forth on the signature pages hereto (“Investors”).

     

    WHEREAS,
      concurrently with the execution of this Agreement, the Investors are acquiring
      an aggregate of (i) 1,874,089 shares (the “Preferred Shares”) of the Company’s
      Series B Convertible Preferred Stock, which are initially convertible into
      307,227,738 shares of the Company’s Common Stock as adjusted pursuant to the
      terms of the Certificate of Designations for the Preferred Shares (the
“Conversion Shares”), (ii) 12,295,082 shares of Common Stock, and (iii) warrants
      (the “Warrants”) to purchase up to 75,254,038 shares (the “Warrant Shares”) of
      the Company’s common stock (subject to adjustment pursuant to the terms of the
      Warrants); 

     

    WHEREAS,
      certain of the Investors may also purchase Additional Securities (as such term
      is defined under Article I.C of the Securities Purchase Agreement, entered
      into
      by the Company and the signatories thereto as of the date hereof) pursuant
      to
      the Securities Purchase Agreement;

     

    WHEREAS,
      the
      Investors and the Company desire to enter into this Agreement to provide the
      Investors with certain rights relating to the registration of the Company’s
      securities held by them;

     

    NOW,
      THEREFORE,
      in
      consideration of the mutual covenants and agreements set forth herein, and
      for
      other good and valuable consideration, the receipt and sufficiency of which
      are
      hereby acknowledged, the parties hereto agree as follows:

     

    1.     DEFINITIONS.
      The
      following capitalized terms used herein have the following
      meanings:

     

    “AGREEMENT”
      means this Agreement, as amended, restated, supplemented, or otherwise modified
      from time to time.

     

    “COMMISSION”
      means the Securities and Exchange Commission, or any other federal agency then
      administering the Securities Act or the Exchange Act.

     

    “COMMON
      STOCK” means the common stock, of the Company.

     

    “COMPANY”
      is defined in the preamble to this Agreement.

     

    “CONVERSION
      SHARES” is defined in the preamble to this Agreement.

     

    “DEMAND
      REGISTRATION” is defined in Section 2.1.1.

     

    “DEMANDING
      HOLDER” is defined in Section 2.1.1.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

       

    

    “EXCHANGE
      ACT” means the Securities Exchange Act of 1934, as amended, and the rules and
      regulations of the Commission promulgated thereunder, all as the same shall
      be
      in effect at the time.

     

    “FORM S-3”
      is defined in Section 2.3.

     

    “INDEMNIFIED
      PARTY” is defined in Section 4.3.

     

    “INDEMNIFYING
      PARTY” is defined in Section 4.3.

     

    “INVESTOR”
      is defined in the preamble to this Agreement.

     

    “INVESTOR
      INDEMNIFIED PARTY” is defined in Section 4.1.

     

    “MAXIMUM
      NUMBER OF SHARES” is defined in Section 2.1.4.

     

    “NOTICES”
      is defined in Section 6.2.

     

    “PIGGYBACK
      REGISTRATION” is defined in Section 2.2.1.

     

    “PREFERRED
      SHARES” is defined in the preamble to this Agreement.

     

    “REGISTER,”
      “REGISTERED” and “REGISTRATION” mean a registration affected by preparing and
      filing a registration statement or similar document in compliance with the
      requirements of the Securities Act, and the applicable rules and regulations
      promulgated thereunder, and such registration statement becoming
      effective.

     

    “REGISTRABLE
      SECURITIES” mean all of (i) the Conversion Shares, (ii) Warrant Shares, (iii)
      any Additional Securities (as such term is defined under Article I. C. of the
      Securities Purchase Agreement) that may be acquired by the Investors or their
      assignees, and (iv) the 12,295,082 shares of Common Stock acquired by Robert
      C.
      Silzer, Sr. concurrently with the execution of this Agreement. Registrable
      Securities shall also include any warrants, shares of capital stock or other
      securities of the Company issued as a dividend or other distribution with
      respect to or in exchange for or in replacement of such shares of Common Stock.
      As to any particular Registrable Securities, such securities shall cease to
      be
      Registrable Securities when: (a) a Registration Statement with respect to
      the sale of such securities shall have become effective under the Securities
      Act
      and such securities shall have been sold, transferred, disposed of or exchanged
      in accordance with such Registration Statement; (b) such securities shall
      have been otherwise transferred, new certificates for them not bearing a legend
      restricting further transfer shall have been delivered by the Company and
      subsequent public distribution of them shall not require registration under
      the
      Securities Act; or (c) such securities shall have ceased to be
      outstanding.

     

    “REGISTRATION
      STATEMENT” means a registration statement filed by the Company with the
      Commission in compliance with the Securities Act and the rules and regulations
      promulgated thereunder for a public offering and sale of Common Stock (other
      than a registration statement on Form S-8, or its successors, or such other
      form which does not include substantially the same information as would be
      required in a form for the general registration of securities or would not
      be
      available for the Registrable Securities).

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

       

    

    “SECURITIES
      ACT” means the Securities Act of 1933, as amended, and the rules and regulations
      of the Commission promulgated thereunder, all as the same shall be in effect
      at
      the time.

     

    “UNDERWRITER”
      means a securities dealer who purchases any Registrable Securities as principal
      in an underwritten offering and not as part of such dealer’s market-making
      activities.

     

    "WARRANTS”
      is defined in the preamble to this Agreement.

     

    “WARRANT
      SHARES” is defined in the preamble to this Agreement

     

    2.     REGISTRATION
      RIGHTS.

     

    2.1.
      DEMAND
      REGISTRATION.

     

    2.1.1.
      REQUEST
      FOR REGISTRATION.
      Subject
      to and in accordance with this Agreement, at any time and from time to time
      on
      or after the date hereof, the Investors or the transferees of Investors shall
      have the unlimited right to demand the registration under the Securities Act
      of
      all or part of their Registrable Securities (a “DEMAND REGISTRATION”), provided
      no demand shall be made for less than 10 million Registrable Securities (as
      adjusted to equitably reflect any stock splits, stock dividends, or any
      combinations or reclassification of the Common Stock or similar transactions).
      Any demand for a Demand Registration shall be in writing and shall specify
      the
      number of shares of Registrable Securities proposed to be sold and the intended
      method(s) of distribution thereof. The Company will notify all other holders
      of
      Registrable Securities of the demand, and each holder of Registrable Securities
      who wishes to include all or a portion of such holder’s Registrable Securities
      in the Demand Registration (each such holder including shares of Registrable
      Securities in such registration, a “DEMANDING HOLDER”) shall so notify the
      Company in writing within twenty (20) days after the receipt by the holder
      of
      the notice from the Company. Upon any such request, the Demanding Holders shall
      be entitled to have their Registrable Securities included in the Demand
      Registration, subject to Section 2.1.3 and the provisos set forth in
      Section 3.1.1. 

     

    2.1.2.
      UNDERWRITTEN
      OFFERING.
      If a
      majority-in-interest of the Demanding Holders so elect and such holders so
      advise the Company as part of their written demand for a Demand Registration,
      the offering of such Registrable Securities pursuant to such Demand Registration
      shall be in the form of an underwritten offering. In such event, the right
      of
      any holder to include its Registrable Securities in such registration shall
      be
      conditioned upon such holder’s participation in such underwriting and the
      inclusion of such holder’s Registrable Securities in the underwriting to the
      extent provided herein. All Demanding Holders proposing to distribute their
      securities through such underwriting shall enter into an underwriting agreement
      in customary form with the Underwriter or Underwriters selected for such
      underwriting by a majority-in-interest of the holders initiating the Demand
      Registration.

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

       

    

    2.1.3.
      REDUCTION
      OF OFFERING.
      If the
      managing Underwriter or Underwriters for a Demand Registration that is to be
      an
      underwritten offering advises the Company and the Demanding Holders in good
      faith in writing that the dollar amount or number of shares of Registrable
      Securities which the Demanding Holders desire to sell, taken together with
      all
      other shares of Common Stock or other securities which the Company desires
      to
      sell and the shares of Common Stock, if any, as to which registration has been
      requested pursuant to written contractual piggy-back registration rights held
      by
      other shareholders of the Company who desire to sell, exceeds the maximum dollar
      amount or maximum number of shares that can be sold in such offering without
      adversely affecting the proposed offering price, the timing, the distribution
      method, or the probability of success of such offering (such maximum dollar
      amount or maximum number of shares, as applicable, the “MAXIMUM NUMBER OF
      SHARES”), then the Company shall include in such registration: (i) first,
      the Registrable Securities as to which Demand Registration has been requested
      by
      the Demanding Holders (pro rata in accordance with the number of shares of
      Registrable Securities which such Demanding Holders have requested be included
      in such registration, regardless of the number of shares held by such Demanding
      Holders) that can be sold without exceeding the Maximum Number of Shares;
      (ii) second, to the extent that the Maximum Number of Shares has not been
      reached under the foregoing clause (i), the shares of Common Stock or other
      securities that the Company desires to sell that can be sold without exceeding
      the Maximum Number of Shares; (iii) third, to the extent that the Maximum
      Number of Shares has not been reached under the foregoing clauses (i) and
      (ii), the shares of Common Stock for the account of other persons that the
      Company is obligated to register pursuant to written contractual arrangements
      with such persons and that can be sold without exceeding the Maximum Number of
      Shares; and (iv) fourth, to the extent that the Maximum Number of Shares
      have not been reached under the foregoing clauses (i), (ii) and (iii), the
      shares of Common Stock that other shareholders desire to sell that can be sold
      without exceeding the Maximum Number of Shares to the extent that the Company,
      in its sole discretion, wishes to permit such sales pursuant to this
      clause (iv).

     

    2.1.4.
      WITHDRAWAL.
      If a
      majority-in-interest of the Demanding Holders disapprove of the terms of any
      underwriting or are not entitled to include all of their Registrable Securities
      in any offering, such majority-in-interest of the Demanding Holders may elect
      to
      withdraw from such offering by giving written notice to the Company and the
      Underwriter or Underwriters of their request to withdraw prior to the
      effectiveness of the Registration Statement filed with the Commission with
      respect to such Demand Registration.

     

    2.2.
      PIGGY-BACK
      REGISTRATION.

     

    2.2.1.
      PIGGYBACK
      RIGHTS.
      If at
      any time on or after the date hereof the Company proposes to file a Registration
      Statement under the Securities Act with respect to an offering of equity
      securities, or securities or other obligations exercisable or exchangeable
      for,
      or convertible into, equity securities, by the Company for its own account
      or
      for shareholders of the Company for their account (or by the Company and by
      shareholders of the Company including, without limitation, pursuant to
      Section 2.1), then the Company shall (x) give written notice of such
      proposed filing to the holders of Registrable Securities as soon as practicable
      but in no event less than twenty (20) days before the anticipated filing
      date, which notice shall describe the amount and type of securities to be
      included in such offering, the intended method(s) of distribution, and the
      name
      of the proposed managing Underwriter or Underwriters, if any, of the offering,
      and (y) offer to the holders of Registrable Securities in such notice the
      opportunity to register the sale of such number of shares of Registrable
      Securities as such holders may request in writing within ten (10) days
      following receipt of such notice (a “PIGGY-BACK REGISTRATION”). The Company
      shall cause such Registrable Securities to be included in such registration
      and
      shall use commercially reasonable efforts to cause the managing Underwriter
      or
      Underwriters of a proposed underwritten offering to permit the Registrable
      Securities requested to be included in a Piggy-Back Registration to be included
      on the same terms and conditions as any similar securities of the Company and
      to
      permit the sale or other disposition of such Registrable Securities in
      accordance with the intended method(s) of distribution thereof. All holders
      of
      Registrable Securities proposing to distribute their securities through a
      Piggy-Back Registration that involves an Underwriter or Underwriters shall
      enter
      into an underwriting agreement in customary form with the Underwriter or
      Underwriters selected for such Piggy-Back Registration.

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

       

    

    2.2.2.
      REDUCTION
      OF OFFERING.
      If the
      managing Underwriter or Underwriters for a Piggy-Back Registration that is
      to be
      an underwritten offering advises the Company and the holders of Registrable
      Securities in good faith in writing that the dollar amount or number of shares
      of Common Stock which the Company desires to sell, taken together with shares
      of
      Common Stock, if any, as to which registration has been demanded pursuant to
      written contractual arrangements with persons other than the holders of
      Registrable Securities hereunder, the Registrable Securities as to which
      registration has been requested under this Section 2.2, and the shares of
      Common Stock, if any, as to which registration has been requested pursuant
      to
      the written contractual piggy-back registration rights of other shareholders
      of
      the Company, exceeds the Maximum Number of Shares, then the Company shall
      include in any such registration:

     

    (i) If
      the
      registration is undertaken for the Company’s account: (A) first, the shares
      of Common Stock or other securities that the Company desires to sell that can
      be
      sold without exceeding the Maximum Number of Shares; (B) second, to the
      extent that the Maximum Number of Shares has not been reached under the
      foregoing clause (A), the Registrable Securities as to which registration
      has been requested under this Section 2.2 (pro rata in accordance with the
      number of shares of Registrable Securities and securities each holder has
      actually requested to be included in such registration, regardless of the number
      of shares of Common Stock with respect to which such persons have the right
      to
      request such inclusion) that can be sold without exceeding the Maximum Number
      of
      Shares; and (c) to the extent that the Maximum Number of Shares has not
      been reached under the foregoing clauses (A) and (B), the shares of Common
      Stock as to which registration has been requested pursuant to written
      contractual piggy-back registration rights of other security holders (pro rata
      in accordance with the number of shares such person has actually requested
      to be
      included in such registration, regardless of the number of shares of Common
      Stock with respect such person has the right to request inclusion).

     

    (ii) If
      the
      registration is a “demand” registration undertaken at the demand of persons
      other than the holders of Registrable Securities pursuant to written contractual
      arrangements with such persons, (A) first, the shares of Common Stock for
      the account of the demanding persons that can be sold without exceeding the
      Maximum Number of Shares; (B) second, to the extent that the Maximum Number
      of Shares has not been reached under the foregoing clause (A), the shares
      of Common Stock or other securities that the Company desires to sell that can
      be
      sold without exceeding the Maximum Number of Shares; and (C) third, to the
      extent that the Maximum Number of Shares has not been reached under the
      foregoing clauses (A) and (B), the Registrable Securities as to which
      registration has been requested under this Section 2.2 (pro rata in
      accordance with the number of shares such person has actually requested to
      be
      included in such registration, regardless of the number of shares of Common
      Stock with respect such person has the right to request inclusion); and
      (D) fourth, to the extent that the Maximum Number of Shares has not been
      reached under the foregoing clauses (A), (B) and (C), the shares of Common
      Stock, if any, as to which registration has been requested pursuant to written
      contractual piggy-back registration rights which other shareholders desire
      to
      sell that can be sold without exceeding the Maximum Number of
      Shares.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

       

    

    2.2.3.
      WITHDRAWAL.
      Any
      holder of Registrable Securities may elect to withdraw such holder’s request for
      inclusion of Registrable Securities in any Piggy-Back Registration by giving
      written notice to the Company of such request to withdraw prior to the
      effectiveness of the Registration Statement. The Company may also elect to
      withdraw a registration statement at any time prior to the effectiveness of
      the
      Registration Statement without thereby incurring any liability to the holders
      of
      Registrable Securities. Notwithstanding any such withdrawal, the Company shall
      pay all expenses incurred by the holders of Registrable Securities in connection
      with such Piggy-Back Registration as provided in Section 3.3.

     

    2.3.
      REGISTRATIONS
      ON FORM S-3.
      The
      holders of Registrable Securities may at any time and from time to time, request
      in writing that the Company register the resale of any or all of such
      Registrable Securities on Form S-3 or any similar short-form registration
      which may be available at such time (“FORM S-3”); PROVIDED, HOWEVER, that
      the Company shall not be obligated to effect such request through an
      underwritten offering. Upon receipt of such written request, the Company will
      promptly give written notice of the proposed registration to all other holders
      of Registrable Securities, and, as soon as practicable thereafter, effect the
      registration of all or such portion of such holder’s or holders’ Registrable
      Securities as are specified in such request, together with all or such portion
      of the Registrable Securities of any other holder or holders joining in such
      request as are specified in a written request given within twenty (20) days
      after receipt of such written notice from the Company; PROVIDED, HOWEVER, that
      the Company shall not be obligated to effect any such registration pursuant
      to
      this Section 2.3: (i) if Form S-3 is not available for such
      offering; or (ii) if the holders of the Registrable Securities, together
      with the holders of any other securities of the Company entitled to inclusion
      in
      such registration, propose to sell Registrable Securities and such other
      securities (if any) at an aggregate price to the public of less than $250,000.
      Registrations effected pursuant to this Section 2.3 shall not be counted as
      Demand Registrations effected pursuant to Section 2.1.

     

    3.     REGISTRATION
      PROCEDURES.

     

    3.1.
      FILINGS;
      INFORMATION.
      Whenever the Company is required to effect the registration of any Registrable
      Securities pursuant to Section 2, the Company shall use its best efforts to
      effect the registration and sale of such Registrable Securities in accordance
      with the intended method(s) of distribution thereof as expeditiously as
      practicable, and in connection with any such request:

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

       

    

    3.1.1.
      FILING
      REGISTRATION STATEMENT.
      The
      Company shall, as expeditiously as possible and in any event within
      seventy-five (75) days after receipt of a request for a Demand Registration
      pursuant to Section 2.1 or an S-3 registration pursuant to Section 2.3,
      prepare and file with the Commission a Registration Statement on any form for
      which the Company then qualifies or which counsel for the Company shall deem
      appropriate and which form shall be available for the sale of all Registrable
      Securities to be registered thereunder in accordance with the intended method(s)
      of distribution thereof, and shall use its best efforts to cause such
      Registration Statement to become and remain effective for the period required
      by
      Section 3.1.3; PROVIDED, HOWEVER, that the Company shall have the right to
      defer any Demand Registration for up to sixty (60) days, and any Piggy-Back
      Registration for such period as may be applicable to deferment of any demand
      registration to which such Piggy-Back Registration relates, in each case if
      the
      Company shall furnish to the holders a certificate signed by the Chief Executive
      Officer of the Company stating that, in the good faith judgment of the Board
      of
      Directors of the Company, it would be materially detrimental to the Company
      and
      its shareholders for such Registration Statement to be effected at such time;
      PROVIDED FURTHER, HOWEVER, that the Company shall not have the right to exercise
      the right set forth in the immediately preceding proviso more than once in
      any
      365-day period in respect of a Demand Registration hereunder.

     

    3.1.2.
      COPIES.
      The
      Company shall, prior to filing a Registration Statement or prospectus, or any
      amendment or supplement thereto, furnish without charge to the holders of
      Registrable Securities included in such registration, and such holders’ legal
      counsel, copies of such Registration Statement as proposed to be filed, each
      amendment and supplement to such Registration Statement (in each case including
      all exhibits thereto and documents incorporated by reference therein), the
      prospectus included in such Registration Statement (including each preliminary
      prospectus), and such other documents as the holders of Registrable Securities
      included in such registration or legal counsel for any such holders may request
      in order to facilitate the disposition of the Registrable Securities owned
      by
      such holders.

     

    3.1.3.
      AMENDMENTS
      AND SUPPLEMENTS.
      The
      Company shall prepare and file with the Commission as expeditiously as possible
      such amendments, including post-effective amendments, and supplements to such
      Registration Statement and the prospectus used in connection therewith as may
      be
      necessary to keep such Registration Statement effective and in compliance with
      the provisions of the Securities Act until all Registrable Securities and other
      securities covered by such Registration Statement have been disposed of in
      accordance with the intended method(s) of distribution set forth in such
      Registration Statement, such securities have been withdrawn, or such securities
      may be sold without volume restrictions pursuant to Rule 144(k).

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

       

    

    3.1.4.
      NOTIFICATION.
      After
      the filing of a Registration Statement, the Company shall promptly, and in
      no
      event more than two (2) business days after such filing, notify the holders
      of Registrable Securities included in such Registration Statement of such
      filing, and shall further notify such holders promptly and confirm such advice
      in writing in all events within two (2) business days of the occurrence of
      any of the following: (i) when such Registration Statement becomes
      effective; (ii) when any post-effective amendment to such Registration
      Statement becomes effective; (iii) the issuance or threatened issuance by
      the Commission of any stop order (and the Company shall take all actions
      required to prevent the entry of such stop order or to remove it if entered);
      and (iv) any request by the Commission for any amendment or supplement to
      such Registration Statement or any prospectus relating thereto or for additional
      information or of the occurrence of an event requiring the preparation of a
      supplement or amendment to such prospectus so that, as thereafter delivered
      to
      the purchasers of the securities covered by such Registration Statement, such
      prospectus will not contain an untrue statement of a material fact or omit
      to
      state any material fact required to be stated therein or necessary to make
      the
      statements therein not misleading, and promptly make available to the holders
      of
      Registrable Securities included in such Registration Statement any such
      supplement or amendment; except that before filing with the Commission a
      Registration Statement or prospectus or any amendment or supplement thereto,
      including documents incorporated by reference, the Company shall furnish to
      the
      holders of Registrable Securities included in such Registration Statement and
      to
      the legal counsel for any such holders, copies of all such documents proposed
      to
      be filed sufficiently in advance of filing to provide such holders and legal
      counsel with a reasonable opportunity to review such documents and comment
      thereon, and the Company shall not file any Registration Statement or prospectus
      or amendment or supplement thereto, including documents incorporated by
      reference, to which such holders or their legal counsel shall
      object.

     

    3.1.5.
      STATE
      SECURITIES LAWS COMPLIANCE.
      The
      Company shall use commercially reasonable efforts to (i) register or
      qualify the Registrable Securities covered by the Registration Statement under
      such securities or “blue sky” laws of such jurisdictions in the United States as
      the holders of Registrable Securities included in such Registration Statement
      (in light of their intended plan of distribution) may request and (ii) take
      such action necessary to cause such Registrable Securities covered by the
      Registration Statement to be registered with or approved by such other
      Governmental Authorities as may be necessary by virtue of the business and
      operations of the Company and do any and all other acts and things that may
      be
      necessary or advisable to enable the holders of Registrable Securities included
      in such Registration Statement to consummate the disposition of such Registrable
      Securities in such jurisdictions; PROVIDED, HOWEVER, that the Company shall
      not
      be required to qualify generally to do business in any jurisdiction where it
      would not otherwise be required to qualify but for this Section 3.1.5 or
      subject itself to taxation in any such jurisdiction.

     

    3.1.6.
      AGREEMENTS
      FOR DISPOSITION.
      The
      Company shall enter into customary agreements (including, if applicable, an
      underwriting agreement in customary form) and take such other actions as are
      reasonably required in order to expedite or facilitate the disposition of such
      Registrable Securities. The representations, warranties and covenants of the
      Company in any underwriting agreement which are made to or for the benefit
      of
      any Underwriters, to the extent applicable, shall also be made to and for the
      benefit of the holders of Registrable Securities included in such registration
      statement. No holder of Registrable Securities included in such registration
      statement shall be required to make any representations or warranties in the
      underwriting agreement except, if applicable, with respect to such holder’s
      organization, good standing, authority, title to Registrable Securities, lack
      of
      conflict of such sale with such holder’s material agreements and organizational
      documents, and with respect to written information relating to such holder
      that
      such holder has furnished in writing expressly for inclusion in such
      Registration Statement.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

       

    

    3.1.7.
      COOPERATION.
      The
      principal executive officer of the Company, the principal financial officer
      of
      the Company, the principal accounting officer of the Company and all other
      officers and members of the management of the Company shall cooperate fully
      in
      any offering of Registrable Securities hereunder, which cooperation shall
      include, without limitation, the preparation of the Registration Statement
      with
      respect to such offering and all other offering materials and related documents,
      and participation in meetings with Underwriters, attorneys, accountants and
      potential investors.

     

    3.1.8.
      RECORDS.
      The
      Company shall make available for inspection by the holders of Registrable
      Securities included in such Registration Statement, any Underwriter
      participating in any disposition pursuant to such registration statement and
      any
      attorney, accountant or other professional retained by any holder of Registrable
      Securities included in such Registration Statement or any Underwriter, all
      financial and other records, pertinent corporate documents and properties of
      the
      Company, as shall be necessary to enable them to exercise their due diligence
      responsibility, and cause the Company’s officers, directors and employees to
      supply all information requested by any of them in connection with such
      Registration Statement.

     

    3.1.9.
      OPINIONS
      AND COMFORT LETTERS.
      The
      Company shall furnish, at the request of any holder requesting registration
      of
      Registrable Securities pursuant tot his Agreement, on the date that such
      Registrable Securities are delivered to the underwriters for sale in connection
      with a registration pursuant to this Agreement, if such securities are being
      sold through underwriters, or, if securities are not being sold through
      underwriters, on the date that the Registration Statement with respect to such
      securities becomes effective, (i) an opinion, dated such date, of the counsel
      representing the Company for the purposes of such registration, in form and
      substance as is customarily given to the underwriters in an underwritten public
      offering, addressed to the underwriters, if any, and to the holders requesting
      registration of Registrable Securities and (ii) a letter dated such date, from
      the independent certified public accountants of the Company, in form and
      substance as is customarily given by independent certified public accountants
      to
      underwriters in an underwritten public offering, addressed to the underwriters,
      if any, and to the holders requesting registration of Registrable
      Securities.

     

    3.1.10.
      COMPLIANCE
      WITH LAWS; EARNINGS STATEMENT.
      The
      Company shall comply with all applicable rules and regulations of the SEC and
      Make generally available to its securityholders earning statements satisfying
      the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder
      (or any similar rule promulgated under the Securities Act) no later than 45
      days
      after the end of any twelve month period (or 90 days after the end of any twelve
      month period is a fiscal year) (i) commencing a the end of any fiscal quarter
      in
      which Registrable Securities are sold to underwriters in a firm commitment
      or
      best efforts underwritten offering, and (ii) if not sold to underwriters in
      such
      an offering, commencing on the first day of the first fiscal quarter of the
      Company, after the effective date of the Registration Statement, which statement
      shall cover said 12-month period.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

       

    

    3.1.11.
      LISTING.
      The
      Company shall cause all Registrable Securities included in any registration
      to
      be listed on such exchanges or otherwise designated for trading in the same
      manner as similar securities issued by the Company are then listed or designated
      or, if no such similar securities are then listed or designated, in a manner
      satisfactory to the holders of a majority of the Registrable Securities included
      in such registration.

     

    3.2.
      OBLIGATION
      TO SUSPEND DISTRIBUTION.
      Upon
      receipt of any notice from the Company of the happening of any event of the
      kind
      described in Section 3.1.4(iv), each holder of Registrable Securities
      included in any registration shall immediately discontinue disposition of such
      Registrable Securities pursuant to the Registration Statement covering such
      Registrable Securities until such holder receives the supplemented or amended
      prospectus contemplated by Section 3.1.4(iv), and, if so directed by the
      Company, each such holder will deliver to the Company all copies, other than
      permanent file copies then in such holder’s possession, of the most recent
      prospectus covering such Registrable Securities at the time of receipt of such
      notice.

     

    3.3.
      REGISTRATION
      EXPENSES.
      The
      Company shall bear all costs and expenses incurred in connection with any Demand
      Registration pursuant to Section 2.1, any Piggy-Back Registration pursuant
      to Section 2.2, and any registration on Form S-3 effected pursuant to
      Section 2.3, and all expenses incurred in performing or complying with its
      other obligations under this Agreement, whether or not the Registration
      Statement becomes effective, including, without limitation: (i) all
      registration and filing fees; (ii) fees and expenses of compliance with
      securities or “blue sky” laws (including fees and disbursements of counsel in
      connection with blue sky qualifications of the Registrable Securities);
      (iii) printing expenses; (iv) the Company’s internal expenses
      (including, without limitation, all salaries and expenses of its officers and
      employees); (v) the fees and expenses incurred in connection with the
      listing of the Registrable Securities as required by Section 3.1.11;
      (vi) National Association of Securities Dealers, Inc. fees; (vii) fees
      and disbursements of counsel for the Company and fees and expenses for
      independent certified public accountants retained by the Company (including
      the
      expenses or costs associated with the delivery of any opinions or comfort
      letters requested pursuant to Section 3.1.9); (viii) the fees and
      expenses of any special experts retained by the Company in connection with
      such
      registration and (ix) the fees and expenses of one legal counsel selected
      by the holders of a majority-in-interest of the Registrable Securities included
      in such registration. The Company shall have no obligation to pay any
      underwriting discounts or selling commissions attributable to the Registrable
      Securities being sold by the holders thereof, which underwriting discounts
      or
      selling commissions shall be borne by such holders. 

     

    3.4.
      INFORMATION.
      The
      holders of Registrable Securities shall provide such information as may
      reasonably be requested by the Company, or the managing Underwriter, if any,
      in
      connection with the preparation of any Registration Statement, including
      amendments and supplements thereto, in order to effect the registration of
      any
      Registrable Securities under the Securities Act pursuant to Section 2 and
      in connection with the Company’s obligation to comply with federal and
      applicable state securities laws.

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

       

    

    4.     INDEMNIFICATION
      AND CONTRIBUTION.

     

    4.1.
      INDEMNIFICATION
      BY THE COMPANY.
      The
      Company shall indemnify and hold harmless each Investor and each other holder
      of
      Registrable Securities, and each of their respective officers, employees,
      affiliates, directors, partners, members, attorneys and agents, and each person,
      if any, who controls an Investor and each other holder of Registrable Securities
      (within the meaning of Section 15 of the Securities Act or Section 20
      of the Exchange Act) (each, an “INVESTOR INDEMNIFIED PARTY”), from and against
      any expenses, losses, judgments, claims, damages or liabilities, whether joint
      or several, arising out of or based upon any untrue statement (or allegedly
      untrue statement) of a material fact contained in any Registration Statement
      under which the sale of such Registrable Securities was registered under the
      Securities Act, any preliminary prospectus, final prospectus or summary
      prospectus contained in the Registration Statement, or any amendment or
      supplement thereto, or arising out of or based upon any omission (or alleged
      omission) to state a material fact required to be stated therein or necessary
      to
      make the statements therein not misleading, or any violation or alleged
      violation by the Company of the Securities Act, the Exchange Act or the
      violation by the Company of any or any rule, law or regulation (including state
      securities laws) relating to the offer and sale of Registrable Securities;
      and
      the Company shall promptly reimburse the Investor Indemnified Party (as such
      expenses are incurred) for any legal and any other expenses reasonably incurred
      by such Investor Indemnified Party in connection with investigating and
      defending any such expense, loss, judgment, claim, damage, liability or action;
      PROVIDED, HOWEVER, that the Company will not be liable in any such case to
      the
      extent that any such expense, loss, claim, damage or liability arises out of
      or
      is based upon any untrue statement or allegedly untrue statement or omission
      or
      alleged omission made in such Registration Statement, preliminary prospectus,
      final prospectus, or summary prospectus, or any such amendment or supplement,
      in
      reliance upon and in conformity with information furnished to the Company,
      in
      writing, by such selling holder expressly for use therein.

     

    4.2.
      INDEMNIFICATION
      BY HOLDERS OF REGISTRABLE SECURITIES.
      Each
      selling holder of Registrable Securities will, in the event that any
      registration is being effected under the Securities Act pursuant to this
      Agreement of any Registrable Securities held by such selling holder, indemnify
      and hold harmless the Company, each of its directors and officers and each
      underwriter (if any), and each other person, if any, who controls the Company
      or
      such underwriter within the meaning of the Securities Act, against any losses,
      claims, judgments, damages or liabilities, whether joint or several, insofar
      as
      such losses, claims, judgments, damages or liabilities (or actions in respect
      thereof) arise out of or are based upon any untrue statement or allegedly untrue
      statement of a material fact contained in any Registration Statement under
      which
      the sale of such Registrable Securities was registered under the Securities
      Act,
      any preliminary prospectus, final prospectus or summary prospectus contained
      in
      the Registration Statement, or any amendment or supplement thereto, or arise
      out
      of or are based upon any omission or the alleged omission to state a material
      fact required to be stated therein or necessary to make the statement therein
      not misleading, if the statement or omission was made in reliance upon and
      in
      conformity with information furnished in writing to the Company by such selling
      holder expressly for use therein, and shall reimburse the Company, its directors
      and officers, and each such controlling person for any legal or other expenses
      reasonably incurred by any of them in connection with investigation or defending
      any such loss, claim, damage, liability or action. Each selling holder’s
      indemnification obligations hereunder shall be several and not joint and shall
      be limited to the amount of any net proceeds (after payment of any underwriting
      fees, discounts, commissions or taxes) actually received by such selling
      holder.

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

       

    

    4.3.
      CONDUCT
      OF INDEMNIFICATION PROCEEDINGS.
      Promptly after receipt by any person of any notice of any loss, claim, damage
      or
      liability or any action in respect of which indemnity may be sought pursuant
      to
      Section 4.1 or 4.2, such person (the “INDEMNIFIED PARTY”) shall, if a claim
      in respect thereof is to be made against any other person for indemnification
      hereunder, notify such other person (the “INDEMNIFYING PARTY”) in writing of the
      loss, claim, judgment, damage, liability or action; PROVIDED, HOWEVER, that
      the
      failure by the Indemnified Party to notify the Indemnifying Party shall not
      relieve the Indemnifying Party from any liability which the Indemnifying Party
      may have to such Indemnified Party hereunder, except and solely to the extent
      the Indemnifying Party is actually prejudiced by such failure. If the
      Indemnified Party is seeking indemnification with respect to any claim or action
      brought against the Indemnified Party, then the Indemnifying Party shall be
      entitled to participate in such claim or action, and, to the extent that it
      wishes, jointly with all other Indemnifying Parties, to assume control of the
      defense thereof with counsel reasonably satisfactory to the Indemnified Party.
      After notice from the Indemnifying Party to the Indemnified Party of its
      election to assume control of the defense of such claim or action, the
      Indemnifying Party shall not be liable to the Indemnified Party for any legal
      or
      other expenses subsequently incurred by the Indemnified Party in connection
      with
      the defense thereof other than reasonable costs of investigation; PROVIDED,
      HOWEVER, that in any action in which both the Indemnified Party and the
      Indemnifying Party are named as defendants, the Indemnified Party shall have
      the
      right to employ separate counsel (but no more than one such separate counsel)
      to
      represent the Indemnified Party and its controlling persons who may be subject
      to liability arising out of any claim in respect of which indemnity may be
      sought by the Indemnified Party against the Indemnifying Party, with the fees
      and expenses of such counsel to be paid by such Indemnifying Party if counsel
      of
      such Indemnified Party reasonably believes that a material conflict of interest
      is likely to exist if the same counsel were to represent such Indemnified Party
      and the Indemnifying Party. No Indemnifying Party shall, without the prior
      written consent of the Indemnified Party, which consent shall not be
      unreasonably withheld, consent to entry of judgment or effect any settlement
      of
      any claim or pending or threatened proceeding in respect of which the
      Indemnified Party is or could have been a party and indemnity could have been
      sought hereunder by such Indemnified Party, unless such judgment or settlement
      includes an unconditional release of such Indemnified Party from all liability
      arising out of such claim or proceeding.

     

    4.4.
      CONTRIBUTION.

     

    4.4.1.
      If
      the
      indemnification provided for in the foregoing Sections 4.1, 4.2 and 4.3 is
      unavailable to any Indemnified Party in respect of any loss, claim, damage,
      liability or action referred to herein, then each such Indemnifying Party,
      in
      lieu of indemnifying such Indemnified Party, shall contribute to the amount
      paid
      or payable by such Indemnified Party as a result of such loss, claim, damage,
      liability or action in such proportion as is appropriate to reflect the relative
      fault of the Indemnified Parties and the Indemnifying Parties in connection
      with
      the actions or omissions which resulted in such loss, claim, damage, liability
      or action, as well as any other relevant equitable considerations. The relative
      fault of any Indemnified Party and any Indemnifying Party shall be determined
      by
      reference to, among other things, whether the untrue or alleged untrue statement
      of a material fact or the omission or alleged omission to state a material
      fact
      relates to information supplied by such Indemnified Party or such Indemnifying
      Party and the parties’ relative intent, knowledge, access to information and
      opportunity to correct or prevent such statement or omission.

     

    
      
         

      

      
        12

        
          

        

      

      
         

      

       

    

    4.4.2.
      The
      parties hereto agree that it would not be just and equitable if contribution
      pursuant to this Section 4.4 were determined by PRO RATA allocation or by
      any other method of allocation which does not take account of the equitable
      considerations referred to in the immediately preceding Section.

     

    4.4.3.
      The
      amount paid or payable by an Indemnified Party as a result of any loss, claim,
      damage, liability or action referred to in the immediately preceding paragraph
      shall be deemed to include, subject to the limitations set forth above, any
      legal or other expenses incurred by such Indemnified Party in connection with
      investigating or defending any such action or claim. Notwithstanding the
      provisions of this Section 4.4, no holder of Registrable Securities shall
      be required to contribute any amount in excess of the dollar amount of the
      net
      proceeds (after payment of any underwriting fees, discounts, commissions or
      taxes) actually received by such holder from the sale of Registrable Securities
      which gave rise to such contribution obligation. No person guilty of fraudulent
      misrepresentation (within the meaning of Section 11(f) of the Securities
      Act) shall be entitled to contribution from any person who was not also guilty
      of such fraudulent misrepresentation.

     

    5.     REPORTS
      UNDER THE EXCHANGE ACT.

     

    With
      a
      view to making available to the holders of Registrable Securities the benefits
      of Rule 144 promulgated under the Securities Act and any other rule or
      regulation of the SEC that may at any time permit a holder of Registrable
      Securities to sell securities of the Company to the public without registration
      on Form S-3, the Company agrees to:

     

    5.1.1.
      make
      and
      keep public information available, as those terms are understood and defined
      in
      SEC Rule 144;

     

    5.1.2.
      file
      with
      the SEC in a timely manner all reports and other documents required to the
      Company under the Securities Act and the Exchange Act; and 

     

    5.1.3.
      furnish
      to any Holder, so long as the Holder owns any Registrable Securities, forthwith
      upon request (i) a written statement by the Company that it has complied with
      the reporting requirements of SEC Rule144, the Securities Act and the Exchange
      Act, or that it qualifies as a registrant whose securities may be resold
      pursuant to Form S-3 (if it so qualifies), (ii) a copy of the most recent annual
      or quarterly report of the Company and such other reports and documents so
      filed
      by the Company, and (iii) such other information as may be reasonably requested
      in availing any Holder of any rule or regulation of the SEC which permits the
      selling of any securities without registration or pursuant to such
      form.

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

       

    

    6.     MISCELLANEOUS.

     

    6.1.
      ASSIGNMENT;
      NO THIRD PARTY BENEFICIARIES.
      This
      Agreement and the rights, duties and obligations of the Company hereunder may
      not be assigned or delegated by the Company in whole or in part. This Agreement
      and the rights, duties and obligations of the holders of Registrable Securities
      hereunder may be freely assigned or delegated by such holder of Registrable
      Securities in conjunction with and to the extent of any transfer of Registrable
      Securities, or any portion thereof, by any such holder. This Agreement and
      the
      provisions hereof shall be binding upon and shall inure to the benefit of each
      of the parties and their respective successors and the permitted assigns of
      the
      Investor or holder of Registrable Securities or of any assignee of the Investor
      or holder of Registrable Securities. This Agreement is not intended to confer
      any rights or benefits on any persons that are not party hereto other than
      as
      expressly set forth in Article 4 and this Section 6.1.

     

    6.2.
      NOTICES.
      All
      notices, demands, requests, consents, approvals or other communications
      (collectively, “NOTICES”) required or permitted to be given hereunder or which
      are given with respect to this Agreement shall be in writing and shall be
      personally served, delivered by reputable air courier service with charges
      prepaid, or transmitted by hand delivery, telegram, telex or facsimile,
      addressed as set forth below, or to such other address as such party shall
      have
      specified most recently by written notice. Notice shall be deemed given on
      the
      date of service or transmission if personally served or transmitted by telegram,
      telex or facsimile; PROVIDED, that if such service or transmission is not on
      a
      business day or is after normal business hours, then such notice shall be deemed
      given on the next business day. Notice otherwise sent as provided herein shall
      be deemed given on the next business day following timely delivery of such
      notice to a reputable air courier service with an order for next-day
      delivery.

     

    To
      the Company:

     

    GPS
      Industries, Inc.

    5500
      152nd
      St.,
      Suite 214

    Surrey,
      British Columbia

    Canada
      v35 559

    Attention:
      Robert C. Silzer, Sr.

    Telecopy:
      604-576-7460

     

    with
      a
      copy to:

     

    Troy
      & Gould Professional Corporation

    1801
      Century Park East, 16th
      Floor

    Los
      Angeles, California 90067

    Attention:
      David L. Ficksman, Esq.

    Telecopy:
      310-789-1490

     

    To
      Investor:

     

    At
      the
      addresses set forth on the signature page hereto

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

       

    

    6.3.
      SEVERABILITY.
      This
      Agreement shall be deemed severable, and the invalidity or unenforceability
      of
      any term or provision hereof shall not affect the validity or enforceability
      of
      this Agreement or of any other term or provision hereof. Furthermore, in lieu
      of
      any such invalid or unenforceable term or provision, the parties hereto intend
      that there shall be added as a part of this Agreement a provision as similar
      in
      terms to such invalid or unenforceable provision as may be possible and be
      valid
      and enforceable.

     

    6.4.
      COUNTERPARTS.
      This
      Agreement may be executed in multiple counterparts, each of which shall be
      deemed an original, and all of which taken together shall constitute one and
      the
      same instrument.

     

    6.5.
      ENTIRE
      AGREEMENT.
      This
      Agreement (including all agreements entered into pursuant hereto and all
      certificates and instruments delivered pursuant hereto and thereto) constitute
      the entire agreement of the parties with respect to the subject matter hereof
      and supersede all prior and contemporaneous agreements, representations,
      understandings, negotiations and discussions between the parties, whether oral
      or written.

     

    6.6.
      MODIFICATIONS
      AND AMENDMENTS.
      No
      amendment, modification or termination of this Agreement shall be binding upon
      any party unless executed in writing by such party. 

     

    6.7.
      TITLES
      AND HEADINGS.
      Titles
      and headings of sections of this Agreement are for convenience only and shall
      not affect the construction of any provision of this Agreement.

     

    6.8.
      WAIVERS
      AND EXTENSIONS.
      Any
      party to this Agreement may waive any right, breach or default which such party
      has the right to waive, PROVIDED that such waiver will not be effective against
      the waiving party unless it is in writing, is signed by such party, and
      specifically refers to this Agreement. Waivers may be made in advance or after
      the right waived has arisen or the breach or default waived has occurred. Any
      waiver may be conditional. No waiver of any breach of any agreement or provision
      herein contained shall be deemed a waiver of any preceding or succeeding breach
      thereof nor of any other agreement or provision herein contained. No waiver
      or
      extension of time for performance of any obligations or acts shall be deemed
      a
      waiver or extension of the time for performance of any other obligations or
      acts.

     

    6.9.
      REMEDIES
      CUMULATIVE.
      In the
      event that the Company fails to observe or perform any covenant or agreement
      to
      be observed or performed under this Agreement, the Investor or any other holder
      of Registrable Securities may proceed to protect and enforce its rights by
      suit
      in equity or action at law, whether for specific performance of any term
      contained in this Agreement or for an injunction against the breach of any
      such
      term or in aid of the exercise of any power granted in this Agreement or to
      enforce any other legal or equitable right, or to take any one or more of such
      actions, without being required to post a bond. None of the rights, powers
      or
      remedies conferred under this Agreement shall be mutually exclusive, and each
      such right, power or remedy shall be cumulative and in addition to any other
      right, power or remedy, whether conferred by this Agreement or now or hereafter
      available at law, in equity, by statute or otherwise.

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

       

    

    6.10.
      GOVERNING
      LAW.
      This
      Agreement shall be governed by, interpreted under, and construed in accordance
      with the internal laws of the State of New York applicable to agreements made
      and to be performed within the State of York.

     

    6.11.
      WAIVER
      OF
      TRIAL BY JURY.
      Each
      party hereby irrevocably and unconditionally waives the right to a trial by
      jury
      in any action, suit, counterclaim or other proceeding (whether based on
      contract, tort or otherwise) arising out of, connected with or relating to
      this
      Agreement, the transactions contemplated hereby, or the actions of the Company
      and the Investor in the negotiation, administration, performance or enforcement
      hereof.

     

    [Remainder
      of Page Intentionally Left Blank.]

     

     

     

     

     

    
 

    
      
         

      

      
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    IN
      WITNESS WHEREOF,
      the
      parties have caused this Registration Rights Agreement to be executed and
      delivered by their duly authorized representatives as of the date first written
      above.

     

     

    
      	 	
              GPS
                INDUSTRIES, INC.

              A
                Nevada corporation

               

            
	 	
              By:_________________________________

              Robert
                C. Silzer, Sr., President

               

            
	 	
              INVESTORS:

               

            
	 	 
	
              Address:
                

               

              C/o
                Istithmar PJSC

               

              Emirates
                Tower - Level 4

               

              Dubai,
                United Arab Emirates

               

            	
              LEISURECORP
                LLC

               

               

               

              By:_________________________________

              Name: ____
                

              Title: _____

               

               

            
	
              Address:

               

              _____________________________

               

              _____________________________

               

              _____________________________

               

            	
              GREAT
                WHITE SHARK ENTERPRISES, INC.

               

               

               

              By:_________________________________

              Name: ____
                

              Title: _____

               

               

            
	
              Address:

               

              _____________________________

               

              _____________________________

               

              _____________________________

               

            	
              ROBERT
                C. SILZER, SR.

               

               

               

              By:_________________________________

               

               

               

            
	
              Address:

               

              _____________________________

               

              _____________________________

               

              _____________________________

               

            	
              DOUGLAS
                WOOD

               

               

               

              By:_________________________________

               

               

               

            

    

    

     

    
      
         

      

      
        17

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}]]