Document:

acgi_8k-ex1004.htm

    Exhibit 10.4

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    SECURITIES
PURCHASE AGREEMENT

     

    By
and Between

     

    THE
AMACORE GROUP, INC.

     

    and

     

    VICIS
CAPITAL MASTER FUND

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    

     

     

    October
6, 2008

     

     

    

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    

     

    SECURITIES
PURCHASE AGREEMENT

     

     

    

     

    This SECURITIES PURCHASE AGREEMENT (the
“Agreement”), effective as of this 6th day of October, 2008, is made by and
between THE AMACORE GROUP, INC., a Delaware corporation (the “Company”), and
VICIS CAPITAL MASTER FUND (the “Purchaser”), a series of the Vicis Capital
Master Trust, a trust formed under the laws of the Cayman Islands.

     

    R E C I T A L
S

     

    WHEREAS, pursuant to the terms and
conditions of this Agreement, the Company wishes to issue and sell to the
Purchaser the following securities (collectively, the “Securities”):
(a) 200 shares (the “Acquired Shares”) of the Company’s Series I
Convertible Preferred Stock, par value $.001 per share (the “Series I Preferred
Stock”); and (b) a warrant to purchase an aggregate of 22,500,000 shares of
the Company’s Class A Common Stock, par value $.001 per share (the “Class A
Common Stock”), initially at an exercise price of $0.375 per share in the form
attached hereto as Exhibit A (the
“Warrant”).

     

    NOW, THEREFORE, the Company and the
Purchaser hereby agree as follows:

     

    ARTICLE
I

    PURCHASE
AND SALE OF THE ACQUIRED SHARES

     

    1.1           Purchase and Sale of the
Acquired Shares.  Subject to the terms and conditions hereof
and in reliance on the representations and warranties contained herein, or made
pursuant hereto, the Company will issue and sell to the Purchaser, and the
Purchaser will purchase from the Company at the closing of the transactions
contemplated hereby (the “Closing”), the Securities for $2,000,000 in cash (the
“Purchase Price”).

     

    1.2           Closing.  The
Closing shall be deemed to have occurred at the offices of Quarles & Brady,
LLP, 411 East Wisconsin Avenue, Milwaukee, Wisconsin at 5:00 p.m. CDT on October
6, 2008 (the “Closing Date).

     

    1.3           Closing Matters. As
soon as reasonably practicable after Closing, subject to the terms and
conditions hereof, the Company will deliver to the Purchaser certificates,
registered in the name of the Purchaser, representing the Acquired Shares and
the Warrant.

     

    ARTICLE
II

    REPRESENTATIONS
AND WARRANTIES OF THE COMPANY

     

    The Company hereby represents and
warrants to the Purchaser as of the date of this Agreement as
follows:

     

    2.1           Organization and
Qualification.  The Company is a corporation duly organized and
validly existing and in good standing under the laws of the jurisdiction in
which it is incorporated, and has all requisite corporate power and authority to
carry on its business as now conducted.   The Company is duly
qualified as a foreign corporation to do business and is in good standing in
every jurisdiction in which its ownership of property or the nature of the
business conducted by it makes such qualification necessary, except to the
extent that the failure to be so qualified or be in good standing would not have
a Material Adverse Effect. As used in this Agreement, “Material Adverse Effect”
means any material adverse effect on the business, properties, assets,
operations, results of operations, condition (financial or otherwise) or
prospects of the Company or its Subsidiaries (as defined below) or on the
transactions contemplated hereby or by the agreements and instruments to be
entered into in connection herewith, or on the authority or ability of the
Company to perform its obligations under the Transaction Documents (as
hereinafter defined).

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.2           Subsidiaries.  The
Company has seven subsidiaries: LBI Brokerage, Inc., JRM Benefits Consulting,
LLC, US Health Benefits Group, Inc., US Health Plans, Inc., On The Phone, Inc.,
Zurvita, Inc. and Lifeguard Benefit Services, Inc.  (each a
“Subsidiary” and collectively, the “Subsidiaries”).

     

    2.3           No
Violation.  Neither the Company nor any Subsidiary is in
violation of: (a) any of the provisions of its certificate of
incorporation, bylaws or other organizational or charter documents; or
(b) any judgment, decree or order or any statute, ordinance, rule or
regulation applicable to the Company, except for possible violations which would
not, individually or in the aggregate, have a Material Adverse
Effect.

     

    2.4           Capitalization.

     

    (a)           As
of the date hereof, the Company is currently authorized to issue up to (i) 1,480
million shares of Common Stock, par value $.001 per share, of which
155,910,526 shares
are currently outstanding and 959,176,067 shares have been reserved for issuance
upon the exercise of all of the outstanding options, warrants and other
securities issued by the Company that are convertible into Common Stock. All of
such outstanding shares have been, or upon issuance will be, validly issued, are
fully paid and nonassessable; and (ii) 20 million shares of Preferred Stock, par
value $.001 per share, of which 2,988.6 shares are currently
outstanding.

     

    (b)           Except
as disclosed herein or in the Company’s reports, schedules, forms, statements
and other documents required to be filed by it with the Securities and Exchange
Commission (the “SEC”) pursuant to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), prior to the date hereof
(the “SEC Documents”):

     

    (i)           no
holder of shares of the Company’s capital stock has any preemptive rights or any
other similar rights or has been granted or holds any liens or encumbrances
suffered or permitted by the Company;

     

    (ii)           there
are no outstanding options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company or its Subsidiary, or contracts, commitments,
understandings or arrangements by which the Company or its Subsidiary are or may
become bound to issue additional shares of capital stock of the Company or its
Subsidiary or options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or securities or rights
convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company or its Subsidiary;

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    (iii)           there
are no outstanding debt securities, notes, credit agreements, credit facilities
or other agreements, documents or instruments evidencing Indebtedness (as
defined in Section 2.14 hereof) of the Company or its Subsidiary or by which the
Company or its Subsidiary are or may become bound;

     

    (iv)           there
are no agreements or arrangements under which the Company is obligated to
register the sale of any of their securities under the Securities Act of 1933,
as amended, (the “Securities Act”);

     

    (v)           there
are no outstanding securities or instruments of the Company that contain any
redemption or similar provisions, and there are no contracts, commitments,
understandings or arrangements by which the Company is or may become bound to
redeem a security of the Company;

     

    (vi)           there
are no securities or instruments containing antidilution or similar provisions
that will be triggered by the issuance of the Securities; and

     

    (vii)           the
Company does not have any stock appreciation rights or “phantom stock” plans or
agreements or any similar plan or agreement.

     

    2.5           Issuance of the Acquired
Shares.

     

    (a)           The
Acquired Shares and the Warrant to be issued hereunder are duly authorized and,
upon payment and issuance in accordance with the terms hereof and thereof, shall
be free from all taxes, Liens and charges with respect to the issuance thereof.
As of the Closing Date, the Company has authorized and has reserved free of
preemptive rights and other similar contractual rights of stockholders, a number
of its authorized but unissued shares of Class A Common Stock equal to one
hundred percent (100%) of the aggregate number of shares of Class A Common Stock
to effect the conversion of the Acquired Shares (the “Conversion Shares”) and
one hundred percent (100%) of the aggregate number of shares of Class A Common
Stock to effect the exercise of the Warrant (the “Warrant
Shares”).  All actions by the Board, the Company and its stockholders
necessary for the valid issuance of the Acquired Shares and the Warrant, and the
Conversion Shares and the Warrant Shares pursuant to the terms of the Series I
Preferred Stock and the Warrant, respectively, has been taken.

     

    (b)           The
Conversion Shares and Warrant Shares, when issued and paid for upon conversion
of the Acquired Shares and Warrant, respectively, will be validly issued, fully
paid and nonassessable and free from all taxes, Liens and charges with respect
to the issue thereof, with the holders being entitled to all rights accorded to
a holder of Class A Common Stock. Assuming the accuracy of each of the
representations and warranties set forth in Article III hereof, the issuance by
the Company to the Purchaser of the Acquired Shares and the Warrant is exempt
from registration under the Securities Act.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.6           Authorization; Enforcement;
Validity. The Company has the requisite corporate power and authority to
enter into and perform its obligations under this Agreement, the Registration
Rights Agreement delivered pursuant to Section 4.4(a) hereof, the Warrant, and
each of the other agreements or instruments entered into by the parties hereto
in connection with the transactions contemplated by this Agreement
(collectively, the “Transaction Documents”) and to issue the Acquired Shares,
the Warrant, the Conversion Shares and the Warrant Shares in accordance with the
terms hereof. The execution and delivery of the Transaction Documents by the
Company and the consummation by the Company of the transactions contemplated
hereby and thereby, including, without limitation, and the issuance of the
Acquired Shares and Warrant, have been duly authorized by the board of directors
of the Company (the “Board”), and no further consent or authorization is
required by the Company, the Board or its stockholders. This Agreement and the
other Transaction Documents of even date herewith have been duly executed and
delivered by the Company, and constitute the legal, valid and binding
obligations of the Company enforceable against the Company in accordance with
their respective terms, except (i) as such enforceability may be limited by
general principles of equity or applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation or similar laws relating to, or
affecting generally, the enforcement of applicable creditors’ rights and
remedies, or (ii) as any rights to indemnity or contribution hereunder may
be limited by federal and state securities laws and public policy
consideration.

     

    2.7           Dilutive Effect. The
Company understands and acknowledges that its obligation to issue the Conversion
Shares and Warrant Shares upon conversion of the Acquired Shares or Warrant, as
the case may be, in accordance therewith is absolute and unconditional
regardless of the dilutive effect that such issuance may have on the ownership
interests of other stockholders of the Company.

     

    2.8           No Conflicts. The
execution, delivery and performance of the Transaction Documents by the Company
and the consummation by the Company of the transactions contemplated hereby and
thereby (including, without limitation, the reservation for issuance of the
Conversion Shares and Warrant Shares) will not (i) result in a violation of
any articles or certificate of incorporation, any certificate of designations,
preferences and rights of any outstanding series of preferred stock or bylaws of
the Company or (ii) conflict with, or constitute a default (or an event
which with notice or lapse of time or both would become a default) under, or
give to others any rights of termination, amendment, acceleration or
cancellation of, any material agreement, indenture or instrument to which the
Company 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) applicable to the Company or by which any property or
asset of the Company is bound or affected, except in the case of clauses (ii)
and (iii), for such breaches or defaults as would not be reasonably expected to
have a Material Adverse Effect.

     

    2.9           Governmental
Consents. Except for the filing of a Form D with the SEC and the
registration of the Conversion Shares and Warrant Shares under the Securities
Act for resale by the Purchaser, the Company is not required to obtain any
consent, authorization or order of, or make any filing or registration with, any
court, governmental agency or any regulatory or self-regulatory agency or any
other Person (as hereinafter defined) in order for it to execute, deliver or
perform any of its obligations under or contemplated by the Transaction
Documents, in each case, in accordance with the terms hereof or thereof. All
consents, authorizations, orders, filings and registrations which the Company is
required to obtain at or prior to the Closing pursuant to the preceding sentence
have been obtained or effected. The Company is unaware of any facts or
circumstances which might prevent the Company from obtaining or effecting any of
the foregoing.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.10           No General
Solicitation.  Neither the Company, its Subsidiary, nor any of
their affiliates, nor any Person acting on its or their behalf, has engaged in
any form of general solicitation or general advertising (within the meaning of
Regulation D under the Securities Act) in connection with the offer or sale of
the Securities.

     

    2.11           No Integrated
Offering. None of the Company, its Subsidiaries, their affiliates, or any
Person acting on their behalf has, directly or indirectly, made any offers or
sales of any security or solicited any offers to buy any security, under
circumstances that would require registration of the Securities under the
Securities Act or cause this offering of the Securities to be integrated with
prior offerings by the Company for purposes of the Securities Act or any
applicable stockholder approval provisions.

     

    2.12           Placement Agent’s
Fees.  Except as set forth on Schedule 2.12, no
brokerage or finder’s fee or commission are or will be payable to any Person
with respect to the transactions contemplated by this Agreement based upon
arrangements made by the Company or any of its affiliates.  The
Company agrees that it shall be responsible for the payment of any placement
agent’s fees, financial advisory fees, or brokers’ commissions (other than for
persons engaged by Purchaser) relating to or arising out of the transactions
contemplated hereby. The Company shall pay, and hold the Purchaser harmless
against, any liability, loss or expense (including, without limitation,
attorney’s fees and out-of-pocket expenses) arising in connection with any claim
for any such fees or commissions.

     

    2.13           Litigation.  There
is no material action, suit, 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, threatened against or affecting the
Company or its Subsidiaries, the transactions contemplated by the Transaction
Documents, the Class A Common Stock or any of the Company’s respective current
or former officers or directors in their capacities as such. To the knowledge of
the Company, there has not been within the past two (2) years, and there is not
pending, any investigation by the SEC involving the Company or any current or
former director or officer of the Company (in his or her capacity as such). The
SEC has not issued any stop order or other order suspending the effectiveness of
any registration statement filed by the Company under the Securities Act within
the past two (2) years.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.14           Indebtedness and Other
Contracts. Except as disclosed in the SEC Documents, the Company (a) does
not have any outstanding Indebtedness (as defined below), (b) is not a
party to any contract, agreement or instrument, the violation of which, or
default under, by any other party to such contract, agreement or instrument
would result in a Material Adverse Effect, (c) is not in violation of any
term of or in default under any contract, agreement or instrument relating to
any Indebtedness, except where such violations and defaults would not result,
individually or in the aggregate, in a Material Adverse Effect, or (d) is
not a party to any contract, agreement or instrument relating to any
Indebtedness, the performance of which, in the judgment of the Company’s
officers, has or is expected to have a Material Adverse Effect.  For
purposes of this Agreement: (x) ”Indebtedness” of any Person means, without
duplication (i) all indebtedness for borrowed money, (ii) all
obligations issued, undertaken or assumed as the deferred purchase price of
property or services (other than trade payables entered into in the ordinary
course of business), (iii) all reimbursement or payment obligations with
respect to letters of credit, surety bonds and other similar instruments,
(iv) all obligations evidenced by notes, bonds, debentures or similar
instruments, including obligations so evidenced incurred in connection with the
acquisition of property, assets or businesses, (v) all indebtedness created
or arising under any conditional sale or other title retention agreement, or
incurred as financing, in either case with respect to any property or assets
acquired with the proceeds of such indebtedness (even though the rights and
remedies of the seller or bank under such agreement in the event of default are
limited to repossession or sale of such property), (vi) all monetary
obligations under any leasing or similar arrangement which, in connection with
generally accepted accounting principles, consistently applied for the periods
covered thereby, is classified as a capital lease, (vii) all indebtedness
referred to in clauses (i) through (vi) above secured by (or for which the
holder of such Indebtedness has an existing right, contingent or otherwise, to
be secured by) any mortgage, lien, pledge, change, security interest or other
encumbrance upon or in any property or assets (including accounts and contract
rights) owned by any Person, even though the Person which owns such assets or
property has not assumed or become liable for the payment of such indebtedness,
and (viii) all Contingent Obligations in respect of indebtedness or
obligations of others of the kinds referred to in clauses (i) through
(vii) above; (y) ”Contingent Obligation” means, as to any Person, any
direct or indirect liability, contingent or otherwise, of that Person with
respect to any indebtedness, lease, dividend or other obligation of another
Person if the primary purpose or intent of the Person incurring such liability,
or the primary effect thereof, is to provide assurance to the obligee of such
liability that such liability will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such liability
will be protected (in whole or in part) against loss with respect thereto; and
(z) ”Person” means an individual, a limited liability company, a
partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a government or any department or agency thereof.

     

    2.15           Financial Information; SEC
Documents.  The Company has 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 Exchange Act. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of the Exchange Act and the rules and regulations of the SEC
promulgated thereunder applicable to such SEC Documents, and none of such 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 the
light of the circumstances under which they were made, not misleading. As of
their respective dates, the financial statements of the Company included in such
SEC Documents complied as to form in all material respects with applicable
accounting requirements and the published rules and regulations of the SEC with
respect thereto. Such financial statements have been prepared in accordance with
generally accepted accounting principles, consistently applied, during the
periods involved (except (i) as may be otherwise indicated in such
financial statements or the notes thereto, or (ii) in the case of unaudited
interim statements, to the extent they may exclude footnotes or may be condensed
or summary statements) and fairly present in all material respects the financial
position of the Company as of the dates thereof and the results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal year-end audit adjustments). No other
information provided by or on behalf of the Company to the Purchaser that is not
included in the SEC Documents contains any untrue statement of a material fact
or omits to state any material fact necessary in order to make the statements
therein, in the light of the circumstance under which they are or were made, not
misleading.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.16           Absence of Certain
Changes. Except as disclosed in the SEC Documents or on Schedule 2.16,
since December 31, 2007, there has been no material adverse change and no
material adverse development in the business, properties, operations, condition
(financial or otherwise), results of operations or prospects of the Company or
its Subsidiary. Since December 31, 2007, the Company has not (i) declared
or paid any dividends, (ii) sold any assets, individually or in the
aggregate, in excess of $50,000 outside of the ordinary course of business or
(iii) had capital expenditures, individually or in the aggregate, in excess
of $100,000. The Company has not taken any steps to seek protection pursuant to
any bankruptcy law nor does the Company have any knowledge or reason to believe
that its creditors intend to initiate involuntary bankruptcy proceedings or any
actual knowledge of any fact which would reasonably lead a creditor to do so.
After giving effect to the transactions contemplated hereby to occur at the
Closing, the Company will not be Insolvent (as hereinafter defined). For
purposes of this Agreement, “Insolvent” means (i) the present fair saleable
value of the Company’s assets is less than the amount required to pay the
Company’s total indebtedness, contingent or otherwise, (ii) the Company is
unable to pay its debts and liabilities, subordinated, contingent or otherwise,
as such debts and liabilities become absolute and matured, (iii) the
Company intends to incur or believes that it will incur debts that would be
beyond its ability to pay as such debts mature or (iv) the Company has
unreasonably small capital with which to conduct the business in which it is
engaged as such business is now conducted and is proposed to be
conducted.

     

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

     

    2.18           Transactions With
Affiliates.  Except as set forth in the SEC Documents or on
Schedule 2.18, none of the officers, directors or employees of the Company or
any Subsidiary is presently a party to any transaction with the Company (other
than for ordinary course services as employees, officers or directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any such
officer, director or employee or, to the knowledge of the Company, any
corporation, partnership, trust or other entity in which any such officer,
director, or employee has a substantial interest or is an officer, director,
trustee or partner.

     

    2.19           Insurance.   The
Company and each Subsidiary is insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as management
of the Company believes to be prudent and customary in the businesses in which
the Company and each such Subsidiary is engaged.  The Company has not
been refused any insurance coverage sought or applied for and the Company has no
reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from
similar insurers as may be necessary to continue its business at a cost that
would not have a Material Adverse Effect.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.20           Employee
Relations.  Neither the Company nor any Subsidiary is a party
to any collective bargaining agreement or employs any member of a union. No
Executive Officer of the Company (as defined in Rule 501(f) of the Securities
Act) has notified the Company that such officer intends to leave the Company or
otherwise terminate such officer’s employment with the Company. No Executive
Officer of the Company, to the knowledge of the Company, is, or is now, in
violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or
any other contract or agreement or any restrictive covenant, and the continued
employment of each such executive officer does not subject the Company to any
liability with respect to any of the foregoing matters. The Company is in
compliance with all federal, state, local and foreign laws and regulations
respecting employment and employment practices, terms and conditions of
employment and wages and hours, except where failure to be in compliance would
not, either individually or in the aggregate, reasonably be expected to result
in a Material Adverse Effect.

     

    2.21           Title.  Each
of the Company and its Subsidiaries has good and marketable title to all
personal property owned by it which is material to their respective business, in
each case free and clear of all liens, encumbrances and defects except such as
are described in the SEC Documents or such as do not materially affect the value
of such property and do not interfere with the use made and proposed to be made
of such property by the Company. 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 are not material and
do not interfere with the use made and proposed to be made of such property and
buildings by the Company.

     

    2.22           Intellectual Property
Rights.  The Company’s and its Subsidiaries’ patents,
trademarks, trade names, service marks copyrights, and registrations and
applications therefor, trade secrets and any other intellectual property right
(collectively, “Intellectual Property Rights”), are, to the best of the
Company’s knowledge, fully valid and are in full force and
effect.  The Company does not have any knowledge of any infringement
by the Company or any Subsidiary of Intellectual Property Rights of others.
There is no claim, action or proceeding being made or brought, or to the
knowledge of the Company, being threatened, against the Company or a Subsidiary
regarding its Intellectual Property Rights that could have a Material Adverse
Effect. The Company is unaware of any facts or circumstances which might give
rise to any of the foregoing infringements or claims, actions or proceedings.
The Company has taken reasonable security measures to protect the secrecy,
confidentiality and value of its Intellectual Property Rights.

     

    2.23           Environmental
Laws.  Each of Company and its Subsidiaries (a) is in
compliance with any and all Environmental Laws (as hereinafter defined),
(b) has received all permits, licenses or other approvals required of them
under applicable Environmental Laws to conduct their respective businesses and
(c) is in compliance with all terms and conditions of any such permit,
license or approval where, in each of the foregoing clauses (a), (b) and (c),
the failure to so comply could be reasonably expected to have, individually or
in the aggregate, a Material Adverse Effect. 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.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.24           Tax
Matters.  Each of Company and its Subsidiaries (a) has
made or filed all federal and state income and all other tax returns, reports
and declarations required by any jurisdiction to which it is subject,
(b) 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 (c) has
set aside on its books reasonably adequate provision for the payment of all
taxes for periods subsequent to the periods to which such returns, reports or
declarations apply, except where such failure would not have a Material Adverse
Effect. 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.

     

    2.25           Sarbanes-Oxley Act.
Except as set forth in Schedule 2.25, the Company is in compliance with any and
all requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the
date hereof and applicable to it, and any and all rules and regulations
promulgated by the SEC thereunder that are effective and applicable to it as of
the date hereof, except where such noncompliance would not have a Material
Adverse Effect.

     

    2.26           Investment Company
Status.  The Company is not, and immediately after receipt of
payment for the Acquired Shares will not be, an “investment company,” an
“affiliated person” of, “promoter” for or “principal underwriter” for, or an
entity “controlled” by an “investment company,” within the meaning of the
Investment Company Act.

     

    2.27           Material
Contracts.  Each contract of the Company that involves
expenditures or receipts in excess of $100,000 (each an “Applicable Contract”)
is in full force and effect and is valid and enforceable in accordance with its
terms. The Company is and has been in full compliance with all applicable terms
and requirements of each Applicable Contract and no event has occurred or
circumstance exists that (with or without notice or lapse of time) may
contravene, conflict with or result in a violation or breach of, or give the
Company or any other entity the right to declare a default or exercise any
remedy under, or to accelerate the maturity or performance of, or to cancel,
terminate or modify any Applicable Contract. The Company has not given or
received from any other entity any notice or other communication (whether oral
or written) regarding any actual, alleged, possible or potential violation or
breach of, or default under, any Applicable Contract.

     

    2.28           Inventory.  All
inventory of the Company consists of a quality and quantity usable and salable
in the ordinary course of business, except for obsolete items and items of
below-standard quality, all of which have been or will be written off or written
down to net realizable value on the audited consolidated balance sheet of the
Company as of December 31, 2007.  The quantities of each type of
inventory (whether raw materials, work-in-process, or finished goods) are not
excessive, but are reasonable and warranted in the present circumstances of the
Company.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    2.29           Disclosure. The
Company confirms that neither it nor any other Person acting on its behalf has
provided the Purchaser or its agents or counsel with any information that
constitutes or might constitute material, nonpublic information that has not
been disclosed in the SEC Documents. The Company understands and confirms that
the Purchaser will rely on the foregoing representations in effecting
transactions in securities of the Company. All disclosure provided to the
Purchaser regarding the Company, its business and the transactions contemplated
hereby, including the Schedules to this Agreement, furnished by or on behalf of
the Company are true and correct and do not contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.

     

    ARTICLE
III

    REPRESENTATIONS
AND WARRANTIES OF THE PURCHASER

     

    The Purchaser hereby represents and
warrants to the Company as of the date of this Agreement as
follows:

     

    3.1           Organization.  The
Purchaser is a corporation, limited liability company or partnership duly
incorporated or organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation or organization.

     

    3.2           Authorization.  This
Agreement has been duly authorized, validly executed and delivered by the
Purchaser and is a valid and binding agreement and obligation of the Purchaser
enforceable against the Purchaser in accordance with its terms, subject to
limitations on enforcement by general principles of equity and by bankruptcy or
other laws affecting the enforcement of creditors’ rights generally, and the
Purchaser has full power and authority to execute and deliver this Agreement and
the other agreements and documents contemplated hereby and to perform its
obligations hereunder and thereunder.

     

    3.3           Investment
Investigation.  The Purchaser understands that no Federal,
state, local or foreign governmental body or regulatory authority has made any
finding or determination relating to the fairness of an investment in the
Acquired Shares and that no Federal, state, local or foreign governmental body
or regulatory authority has recommended or endorsed, or will recommend or
endorse, any investment in the Acquired Shares. The Purchaser, in making the
decision to purchase the Acquired Shares, has relied upon independent
investigation made by it and has not relied on any information or
representations made by third parties.

     

    3.4           Accredited
Investor.  The Purchaser is an “accredited investor” as defined
under Rule 501 of Regulation D promulgated under the Securities
Act.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    3.5           No
Distribution.  The Purchaser is and will be acquiring the
Acquired Shares for its own account, and not with a view to any resale or
distribution of the Acquired Shares in whole or in part, in violation of the
Securities Act or any applicable securities laws.

     

    3.6           Resale.  The
parties intend that the offer and sale of the Acquired Shares be exempt from
registration under the Securities Act, by virtue of Section 4(2) and/or Rule 506
of Regulation D promulgated under the Securities Act. The Purchaser understands
that the Acquired Shares purchased hereunder have not been, and may never be,
registered under the Securities Act and that the Acquired Shares cannot be sold
or transferred unless its is first registered under the Securities Act and such
state and other securities laws as may be applicable or in the opinion of
counsel for the Company an exemption from registration under the Securities Act
is available (and then the Acquired Shares may be sold or transferred only in
compliance with such exemption and all applicable state and other securities
laws).

     

    3.7           Reliance.  The
Purchaser understands that the Acquired Shares is being offered and sold to it
in reliance on specific provisions of Federal and state securities laws and that
the Company is relying upon the truth and accuracy of the representations,
warranties, agreements, acknowledgments and understandings of the Purchaser set
forth herein for purposes of qualifying for exemptions from registration under
the Securities Act, and applicable state securities laws.

     

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    
      ARTICLE
IV

    

    CONDITIONS
TO CLOSING OF THE PURCHASERS

     

    The obligation of the Purchaser to
purchase the Securities at the Closing is subject to the fulfillment to the
Purchaser’s satisfaction on or prior to the Closing Date of each of the
following conditions, any of which may be waived by the Purchaser:

     

    4.1           Representations and
Warranties Correct.  The representations and warranties in
Article II hereof shall be true and correct when made, and shall be true and
correct on the Closing Date with the same force and effect as if they had been
made on and as of the Closing Date.

     

    4.2           Performance.  All
covenants, agreements and conditions contained in this Agreement to be performed
or complied with by the Company on or prior to the Closing Date shall have been
performed or complied with by the Company in all material respects.

     

    4.3           No
Impediments.  Neither the Company nor any Purchaser shall be
subject to any order, decree or injunction of a court or administrative agency
of competent jurisdiction that prohibits the transactions contemplated hereby or
would impose any material limitation on the ability of such Purchaser to
exercise full rights of ownership of the Acquired Shares.  At the time
of the Closing, the purchase of the Acquired Shares to be purchased by the
Purchaser hereunder shall be legally permitted by all laws and regulations to
which the Purchaser and the Company are subject.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    4.4           Other Agreements and
Documents.  Company shall have executed and delivered the
following agreements and documents:

     

    (a)           Certificates,
registered in the name of the Purchaser, representing the Acquired Shares and
the Warrant in the form of Exhibit A attached
hereto.

     

    (b)           The
Registration Rights Agreement in the form of Exhibit B attached
hereto (the “Registration Rights Agreement”);

     

    (c)           A
certificate of good standing with respect to the Company from the Secretary of
State of Delaware;

     

    (d)           A
certificate of the Company’s Secretary, dated the Closing Date, certifying
(i) the fulfillment of the conditions specified in Sections 4.1 and 4.2 of
this Agreement, (ii) the Board resolutions approving this Agreement and the
transactions contemplated hereby, (iii) the Company’s certificate of
incorporation, and (iv) other matters as the Purchaser shall reasonably
request;

     

    (e)           A
written waiver, in form and substance satisfactory to the Purchaser, from each
person other than the Purchaser who has any of the following
rights:

     

    (i)           any
currently effective right of first refusal to acquire the Acquired Shares;
or

     

    (ii)           any
right to an anti-dilution adjustment of securities issued by the Company that
are held by such person that will be triggered as a result of the issuance of
the Acquired Shares; and

     

    (f)           All
necessary consents or waivers, if any, from all parties to any other material
agreements to which the Company is a party or by which it is bound immediately
prior to the Closing in order that the transactions contemplated hereby may be
consummated and the business of the Company may be conducted by the Company
after the Closing without adversely affecting the Company.

     

    4.5           Due Diligence
Investigation.  No fact shall have been discovered, whether or
not reflected in the Schedules hereto, which in the Purchaser’s determination
would make the consummation of the transactions contemplated by this Agreement
not in the Purchaser’s best interests.

     

    ARTICLE
V

    CONDITIONS
TO CLOSING OF THE COMPANY

     

    The Company’s obligation to sell the
Securities at the Closing is subject to the fulfillment to its satisfaction on
or prior to the Closing Date of each of the following conditions:

     

    5.1           Representations.  The
representations made by the Purchaser pursuant to Article III hereof shall
be true and correct when made and shall be true and correct on the Closing
Date.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    5.2           Other Agreements and
Documents.  Purchaser shall have executed and delivered the
following agreements and documents:

     

    (a)           The
Registration Rights Agreement; and

     

    (b)           The
Waiver of Anti-Dilution Rights in the form of Exhibit C attached
hereto.

     

    5.3           No
Impediments.  Neither the Company nor any Purchaser shall be
subject to any order, decree or injunction of a court or administrative agency
of competent jurisdiction that prohibits the transactions contemplated hereby or
would impose any material limitation on the ability of such Purchaser to
exercise full rights of ownership of the Acquired Shares.  At the time
of the Closing, the purchase of the Acquired Shares to be purchased by the
Purchaser hereunder shall be legally permitted by all laws and regulations to
which the Purchaser and the Company are subject.

     

    5.4           Payment of Purchase
Price.  The Company shall have received the Purchase
Price.

     

    ARTICLE
VI

    INDEMNIFICATION

     

    6.1           Indemnification by the
Company.  The Company agrees to defend, indemnify and hold
harmless the Purchaser and shall reimburse the Purchaser for, from and against
each claim, loss, liability, cost and expense (including without limitation,
interest, penalties, costs of preparation and investigation, and the reasonable
fees, disbursements and expenses of attorneys, accountants and other
professional advisors) (collectively, “Losses”) directly or indirectly relating
to, resulting from or arising out of any untrue representation,
misrepresentation, breach of warranty or non-fulfillment of any covenant,
agreement or other obligation by or of the Company contained herein or in any
certificate, document, or instrument delivered to the Purchaser pursuant
hereto.

     

    6.2           Indemnification by the
Purchaser.  The Purchaser agrees to defend, indemnify and hold
harmless the Company and shall reimburse the Company for, from and against all
Losses directly or indirectly relating to, resulting from or arising out of any
untrue representation, misrepresentation, breach of warranty or non-fulfillment
of any covenant, agreement or other obligation of the Purchaser contained herein
or in any certificate, document or instrument delivered to the Company pursuant
hereto.

     

    6.3           Procedure. The
indemnified party shall promptly notify the indemnifying party of any claim,
demand, action or proceeding for which indemnification will be sought under
Sections 6.1 or 6.2 of this Agreement, and, if such claim, demand, action or
proceeding is a third party claim, demand, action or proceeding, the
indemnifying party will have the right at its expense to assume the defense
thereof using counsel reasonably acceptable to the indemnified
party.  The indemnified party shall have the right to participate, at
its own expense, with respect to any such third party claim, demand, action or
proceeding.  In connection with any such third party claim, demand,
action or proceeding, the Purchaser and the Company shall cooperate with each
other and provide each other with access to relevant books and records in their
possession.  No such third party claim, demand, action or proceeding
shall be settled without the prior written consent of the indemnified party,
which shall not be unreasonably withheld.  If a firm written offer is
made to settle any such third party claim, demand, action or proceeding and the
indemnifying party proposes to accept such settlement and the indemnified party
refuses to consent to such settlement, then: (i) the indemnifying party
shall be excused from, and the indemnified party shall be solely responsible
for, all further defense of such third party claim, demand, action or
proceeding; and (ii) the maximum liability of the indemnifying party
relating to such third party claim, demand, action or proceeding shall be the
amount of the proposed settlement if the amount thereafter recovered from the
indemnified party on such third party claim, demand, action or proceeding is
greater than the amount of the proposed settlement.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    ARTICLE
VII

    MISCELLANEOUS

     

    7.1           Governing
Law.  This Agreement and the rights of the parties hereunder
shall be governed in all respects by the laws of the State of New York wherein
the terms of this Agreement were negotiated, without regard to the conflicts of
laws thereof.

     

    7.2           Survival.  Except
as specifically provided herein, the representations, warranties, covenants and
agreements made herein shall survive the Closing.

     

    7.3           Amendment.  This
Agreement may not be amended, discharged or terminated (or any provision hereof
waived) without the written consent of the Company and the
Purchaser.

     

    7.4           Successors and
Assigns.  Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon and
enforceable by and against, the successors, assigns, heirs, executors and
administrators of the parties hereto.  The Purchaser may assign its
rights hereunder, and the Company may not assign its rights or obligations
hereunder without the consent of the Purchaser or any of its successors,
assigns, heirs, executors and administrators.

     

    7.5           Entire
Agreement.  This Agreement, the Transaction Documents and the
other documents delivered pursuant hereto and simultaneously herewith constitute
the full and entire understanding and agreement between the parties with regard
to the subject matter hereof and thereof.

     

    7.6           Notices,
etc.  All notices, demands or other communications given
hereunder shall be in writing and shall be sufficiently given if delivered
either personally or by a nationally recognized courier service marked for next
business day delivery or sent in a sealed envelope by first class mail, postage
prepaid and either registered or certified, addressed as follows:

     

    (a)           if
to the Company: 1511 North Westshore Blvd. Tampa, Florida  34607 Attn:
Chief Executive Officer

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    
      	
            	
              (b) 

            	
              if
      to a Purchaser:

               

              
                Vicis
      Capital Master Fund

                Tower
      56, Suite 700

                126
      E. 56th Street, 7th Floor

                New
      York, NY 10022

                Attn:
      Shad Stastney

              

            

    

     

    
    

    with a
copy to:

     

    Andrew D.
Ketter, Esq.

    Quarles
& Brady LLP

    411 East
Wisconsin Avenue

    Milwaukee,
Wisconsin 53202

     

    7.7           Delays or
Omissions.  No delay or omission to exercise any right, power
or remedy accruing to any holder of any Acquired Shares upon any breach or
default of the Company under this Agreement shall impair any such right, power
or remedy of such holder nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence, therein, or of or in any similar breach
or default thereafter occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring.  Any waiver, permit, consent or approval of any
kind or character on the part of any holder of any breach or default under this
Agreement, or any waiver on the part of any holder of any provisions or
conditions of this Agreement must be, made in writing and shall be effective
only to the extent specifically set forth in such writing.  All
remedies, either under this Agreement or by law or otherwise afforded to any
holder, shall be cumulative and not alternative.

     

    7.8           Severability.  The
invalidity of any provision or portion of a provision of this Agreement shall
not affect the validity of any other provision of this Agreement or the
remaining portion of the applicable provision.  It is the desire and
intent of the parties hereto that the provisions of this Agreement shall be
enforced to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is
sought.  Accordingly, if any particular provision of this Agreement
shall be adjudicated to be invalid or unenforceable, such provision shall be
deemed amended to delete therefrom the portion thus adjudicated to be invalid or
unenforceable, such deletion to apply only with respect to the operation of such
provision in the particular jurisdiction in which such adjudication is
made.

     

    7.9           Expenses.  The
Company shall bear its own expenses and legal fees incurred on its behalf with
respect to the negotiation, execution and consummation of the transactions
contemplated by this Agreement and shall pay all documentary stamp or similar
taxes imposed by any authority upon the transactions contemplated by this
Agreement or any Transaction Document. The Company shall pay all reasonable,
documented third-party fees and expenses incurred by the Purchaser in connection
with the enforcement of this Agreement or any of the other Transaction
Documents, including, without limitation, all actual reasonable attorneys’ fees
and expenses.

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    7.10           Consent to Jurisdiction;
Waiver of Jury Trial.  EACH OF THE PARTIES TO THIS AGREEMENT
HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF
THE STATE AND FEDERAL COURTS LOCATED THE STATE AND COUNTY OF NEW YORK FOR
PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT
AND THE TRANSACTION DOCUMENTS.  EACH OF THE PARTIES TO THIS AGREEMENT
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
SUCH PARTY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
PROCEEDING BROUGHT IN ANY SUCH COURTS AND ANY CLAIM THAT ANY SUCH PROCEEDING
BROUGHT IN ANY SUCH COURTS HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.  EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY IN ANY SUCH LEGAL
PROCEEDING.  EACH OF THE PARTIES TO THIS AGREEMENT HEREBY CONSENTS TO
SERVICE OF PROCESS BY NOTICE IN THE MANNER SPECIFIED IN SECTION 7.6 AND
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION SUCH
PARTY MAY NOW OR HEREAFTER HAVE TO SERVICE OF PROCESS IN SUCH
MANNER.

     

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

     

    7.12           Further
Assurances.  The parties agree to execute and deliver all such
further documents, agreements and instruments and take such other and further
action as may be necessary or appropriate to carry out the purposes and intent
of this Agreement.

     

    7.13           Counterparts.  This
Agreement may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one
instrument.

     

    

     

    [SIGNATURE
PAGE FOLLOWS]

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    

    IN WITNESS WHEREOF, the parties hereto
have duly executed this Securities Purchase Agreement, as of the day and year
first above written.

     

    

     

    
    

     

    
      	 	
              COMPANY:

               

              THE
      AMACORE GROUP, INC.

              

              

              /s/
      Jay
      Shafer                      
               

              Jay
      Shafer

              President
      and Chief Executive Officer

              

              

              

              PURCHASER:

              

              VICIS
      CAPITAL MASTER FUND

              By:
      Vicis Capital LLC

              

              

              /s/ Chris
      Phillips                           
      

              Chris
      Phillips

              Managing
      Director

            

    

     

     

    

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    

    EXHIBIT
A

    

    FORM
OF WARRANT

    

     

     

     

     

     

     

     

     

     

     

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
B

    

     

    FORM
OF REGISTRATION RIGHTS AGREEMENT

     

     

     

     

     

     

     

     

     

     

    
 

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
C

    

    FORM
OF WAIVER OF ANTI-DILUTION RIGHTS

    

    

    

    

    

     

     

     

     

     

     

     

     

     

     

    
 

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    SCHEDULES

    

    Schedule
2.16 – Prior to an infusion of capital from Purchaser, the Company was
experiencing severe liquidity issues.

    

    Schedule
2.18 – Jay Shafer, President and Chief Executive Officer loaned the Company
$500,000.

    

    Schedule
2.25 – Due to recent resignations of certain directors, the Company may not be
full compliance with respect to requirements relating to having an audit
committee comprised of independent directors.acgi_8k-ex1005.htm

    Exhibit
10.5

    

    THIS
WARRANT AND THE SHARES OF CLASS A COMMON STOCK ISSUABLE UPON EXERCISE HEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER
APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH
SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED.

    

    WARRANT
TO PURCHASE

    

    SHARES OF
CLASS A COMMON STOCK

    

    OF

    

    THE
AMACORE GROUP, INC.

    

    Expires
October 6, 2013

    

    
      
        	
                No.:
      W-08-05

              	
                Number
      of Shares: 22,500,000

              
	
                Date
      of Issuance: October 6, 2008

              	 
      

      

    

    

    FOR VALUE
RECEIVED, the undersigned, The Amacore Group, Inc., a Delaware corporation
(together with its successors and assigns, the “Issuer”), hereby
certifies that Vicis Capital Master Fund or its registered assigns is entitled
to subscribe for and purchase, during the Term (as hereinafter defined), up to
Twenty-Two Million Five Hundred Thousand (22,500,000) shares (subject to
adjustment as hereinafter provided) of the duly authorized, validly issued,
fully paid and non-assessable Class A Common Stock of the Issuer, par value
$.001 per share (the “Class A Common
Stock”), at an exercise price per share equal to the Warrant Price then
in effect, subject, however, to the provisions and upon the terms and conditions
hereinafter set forth.  This Warrant has been executed and delivered
pursuant to the Securities Purchase Agreement dated as of October 6, 2008 (the
“Purchase
Agreement”) by and among the Issuer and the purchaser(s) listed
therein.  Capitalized terms used and not otherwise defined herein
shall have the meanings set forth for such terms in the Purchase Agreement.
Capitalized terms used in this Warrant and not otherwise defined herein shall
have the respective meanings specified in Section 8 hereof.

    

    1.           Term.  The
term of this Warrant shall commence on October 6, 2008 and shall expire at 6:00
p.m., eastern time, on October 6, 2013 (such period being the “Term”).

     

     

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    
 

    
      2.            
Method of Exercise; Payment;
Issuance of New Warrant; Transfer and Exchange.

    

    

    (a)           Time of
Exercise.  The purchase rights represented by this Warrant may
be exercised in whole or in part during the Term beginning on the date of
issuance hereof.

    

    (b)           Method of
Exercise.  The Holder hereof may exercise this Warrant, in
whole or in part, by the surrender of this Warrant (with the exercise form
attached hereto duly executed) at the principal office of the Issuer, and by the
payment to the Issuer of an amount of consideration therefor equal to the
Warrant Price in effect on the date of such exercise multiplied by the number of
shares of Warrant Stock with respect to which this Warrant is then being
exercised, payable at such Holder’s election (i) by certified or official bank
check or by wire transfer to an account designated by the Issuer, (ii) by
“cashless exercise” in accordance with the provisions of subsection (c) of this
Section 2, but only when a registration statement under the Securities Act
providing for the resale of the Warrant Stock is not then in effect, or (iii)
when permitted by clause (ii), by a combination of the foregoing methods of
payment selected by the Holder of this Warrant.

    

    (c)           Cashless
Exercise.  Notwithstanding any provisions herein to the
contrary and commencing six-months following the Original Issue Date if (i) the
Per Share Market Value of one share of Class A Common Stock is greater than the
Warrant Price (at the date of calculation as set forth below) and (ii) a
registration statement under the Securities Act providing for the resale of the
Warrant Stock is not in effect in accordance with the terms of the Registration
Rights Agreement at the time of exercise, in lieu of exercising this Warrant by
payment of cash, the Holder may exercise this Warrant by a cashless exercise and
shall receive the number of shares of Class A Common Stock equal to an amount
(as determined below) by surrender of this Warrant at the principal office of
the Issuer together with the properly endorsed Notice of Exercise in which event
the Issuer shall issue to the Holder a number of shares of Class A Common Stock
computed using the following formula:

    

    

    

    

    
      	
              Where

            	
              X
      =

            	
              the
      number of shares of Class A Common Stock to be issued to the
      Holder.

            
	 
      	 
      	 
      
	 
      	
              Y
      =

            	
              the
      number of shares of Class A Common Stock purchasable upon exercise of all
      of the Warrant or, if only a portion of the Warrant is being exercised,
      the portion of the Warrant being exercised.

            
	 
      	 
      	 
      
	 
      	
              A
      =

            	
              the
      Warrant Price.

            
	 
      	 
      	 
      
	 
      	
              B
      =

            	
              the
      Per Share Market Value of one share of Class A Common
    Stock.

            

    

     

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    

    (d)           Issuance of Stock
Certificates.  In the event of any exercise of this Warrant in
accordance with and subject to the terms and conditions hereof, certificates for
the shares of Warrant Stock so purchased shall be dated the date of such
exercise and delivered to the Holder hereof within a reasonable time, not
exceeding three (3) Trading Days after such exercise (the “Delivery Date”) or,
at the request of the Holder (provided that a registration statement under the
Securities Act providing for the resale of the Warrant Stock is then in effect),
issued and delivered to the Depository Trust Company (“DTC”) account on the
Holder’s behalf via the Deposit Withdrawal Agent Commission System (“DWAC”) within a
reasonable time, not exceeding three (3) Trading Days after such exercise, and
the Holder hereof shall be deemed for all purposes to be the holder of the
shares of Warrant Stock so purchased as of the date of such
exercise.  Notwithstanding the foregoing to the contrary, the Issuer
or its transfer agent shall only be obligated to issue and deliver the shares to
the DTC on a holder’s behalf via DWAC if such exercise is in connection with a
sale and the Issuer and its transfer agent are participating in DTC through the
DWAC system.  The Holder shall deliver this original Warrant, or an
indemnification undertaking with respect to such Warrant in the case of its
loss, theft or destruction, at such time that this Warrant is fully
exercised.  With respect to partial exercises of this Warrant, the
Issuer shall keep written records for the Holder of the number of shares of
Warrant Stock exercised as of each date of exercise.

    

    (e)           Compensation for Buy-In on
Failure to Timely Deliver Certificates Upon Exercise.

    

    (i)           The
Issuer understands that a delay in the delivery of the shares of Class A Common
Stock upon exercise of this Warrant beyond the Delivery Date could result in
economic loss to the Holder.  If the Issuer fails to deliver to the
Holder such shares via DWAC or a certificate or certificates pursuant to this
Section hereunder by the Delivery Date, the Issuer shall pay to the Holder, in
cash, for each $500 of Warrant Shares (based on the Closing Price of the Class A
Common Stock on the date such Securities are submitted to the Issuer’s transfer
agent), $5 per Trading Day (increasing to $10 per Trading Day five (5) Trading
Days after such damages have begun to accrue and increasing to $15 per Trading
Day ten (10) Trading Days after such damages have begun to accrue) for each
Trading Day after the Delivery Date until such certificate is delivered (which
amount shall be paid as liquidated damages and not as a
penalty).  Nothing herein shall limit a Holder’s right to pursue
actual damages for the Issuer’s failure to deliver certificates representing any
Securities as required by the Transaction Documents, and the Holder shall have
the right to pursue all remedies available to it at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief.
Notwithstanding anything to the contrary contained herein, the Holder shall be
entitled to withdraw an Exercise Notice, and upon such withdrawal the Issuer
shall only be obligated to pay the liquidated damages accrued in accordance with
this Section 2(e)(i) through the date the Exercise Notice is
withdrawn.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    
 

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

     

    (f)           Transferability of
Warrant.  Subject to Section 2(h) hereof, this Warrant may be
transferred by a Holder, in whole or in part, subject only to the restrictions
specified in the Purchase Agreement.  If transferred pursuant to this
paragraph, this Warrant may be transferred on the books of the Issuer by the
Holder hereof in person or by duly authorized attorney, upon surrender of this
Warrant at the principal office of the Issuer, properly endorsed (by the Holder
executing an assignment in the form attached hereto) and upon payment of any
necessary transfer tax or other governmental charge imposed upon such
transfer.  This Warrant is exchangeable at the principal office of the
Issuer for Warrants to purchase the same aggregate number of shares of Warrant
Stock, each new Warrant to represent the right to purchase such number of shares
of Warrant Stock as the Holder hereof shall designate at the time of such
exchange.  All Warrants issued on transfers or exchanges shall be
dated the Original Issue Date and shall be identical with this Warrant except as
to the number of shares of Warrant Stock issuable pursuant thereto.

    

    (g)           Continuing Rights of
Holder.  The Issuer will, at the time of or at any time after
each exercise of this Warrant, upon the request of the Holder hereof,
acknowledge in writing the extent, if any, of its continuing obligation to
afford to such Holder all rights to which such Holder shall continue to be
entitled after such exercise in accordance with the terms of this Warrant, provided that if any
such Holder shall fail to make any such request, the failure shall not affect
the continuing obligation of the Issuer to afford such rights to such
Holder.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    
 

    (h)           Compliance with Securities
Laws.

    

    (i)           The
Holder of this Warrant, by acceptance hereof, acknowledges that this Warrant and
the shares of Warrant Stock to be issued upon exercise hereof are being acquired
solely for the Holder’s own account and not as a nominee for any other party,
and for investment, and that the Holder will not offer, sell or otherwise
dispose of this Warrant or any shares of Warrant Stock to be issued upon
exercise hereof except pursuant to an effective registration statement, or an
exemption from registration, under the Securities Act and any applicable state
securities laws.

    

    (ii)           Except
as provided in paragraph (iii) below, this Warrant and all certificates
representing shares of Warrant Stock issued upon exercise hereof shall be
stamped or imprinted with a legend in substantially the following
form:

    

    THIS
WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION OF SUCH SECURITIES UNDER
THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS
IS NOT REQUIRED.

    

    (iii)           The
Issuer agrees to reissue this Warrant or certificates representing any of the
Warrant Stock, without the legend set forth above if at such time, prior to
making any transfer of any such securities, the Holder shall give written notice
to the Issuer describing the manner and terms of such transfer.  Such
proposed transfer will not be effected until: (a) either (i) the Issuer has
received an opinion of counsel reasonably satisfactory to the Issuer, to the
effect that the registration of such securities under the Securities Act is not
required in connection with such proposed transfer, (ii) a registration
statement under the Securities Act covering such proposed disposition has been
filed by the Issuer with the Securities and Exchange Commission and has become
effective under the Securities Act, (iii) the Issuer has received other evidence
reasonably satisfactory to the Issuer that such registration and qualification
under the Securities Act and state securities laws are not required, or (iv) the
Holder provides the Issuer with reasonable assurances that such security can be
sold pursuant to Rule 144 under the Securities Act; and (b) either (i) the
Issuer has received an opinion of counsel reasonably satisfactory to the Issuer,
to the effect that registration or qualification under the securities or “blue
sky” laws of any state is not required in connection with such proposed
disposition, or (ii) compliance with applicable state securities or “blue sky”
laws has been effected or a valid exemption exists with respect
thereto.  The Issuer will respond to any such notice from a holder
within three (3) Trading Days.  In the case of any proposed transfer
under this Section 2(h), the Issuer will use reasonable efforts to comply with
any such applicable state securities or “blue sky” laws, but shall in no event
be required, (x) to qualify to do business in any state where it is not then
qualified, (y) to take any action that would subject it to tax or to the general
service of process in any state where it is not then subject, or (z) to comply
with state securities or “blue sky” laws of any state for which registration by
coordination is unavailable to the Issuer.  The restrictions on
transfer contained in this Section 2(h) shall be in addition to, and not by way
of limitation of, any other restrictions on transfer contained in any other
section of this Warrant.  Whenever a certificate representing the
Warrant Stock is required to be issued to a the Holder without a legend, in lieu
of delivering physical certificates representing the Warrant Stock, the Issuer
shall cause its transfer agent to electronically transmit the Warrant Stock to
the Holder by crediting the account of the Holder’s Prime Broker with DTC
through its DWAC system (to the extent not inconsistent with any provisions of
this Warrant or the Purchase Agreement).

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    
 

    (i)           Accredited Investor
Status.  In no event may the Holder exercise this Warrant in
whole or in part unless the Holder is an “accredited investor” as defined in
Regulation D under the Securities Act.

    

    (j)           No Mandatory
Redemption.  This Warrant may not be called or redeemed by the
Issuer without the written consent of the Holder, except as provided in Section
7.14 of the Purchase Agreement.

    

    3.           Stock Fully Paid;
Reservation and Listing of Shares; Covenants.

    

    (a)           Stock Fully
Paid.  The Issuer represents, warrants, covenants and agrees
that all shares of Warrant Stock which may be issued upon the exercise of this
Warrant or otherwise hereunder will, when issued in accordance with the terms of
this Warrant, be duly authorized, validly issued, fully paid and non-assessable
and free from all taxes, liens and charges created by or through the
Issuer.  The Issuer further covenants and agrees that during the
period within which this Warrant may be exercised, the Issuer will at all times
have authorized and reserved for the purpose of the issuance upon exercise of
this Warrant a number of authorized but unissued shares of Class A Common Stock
equal to at least one hundred percent (100%) of the number of shares of Class A
Common Stock issuable upon exercise of this Warrant without regard to any
limitations on exercise.

    

    (b)           Reservation.  If
any shares of Class A Common Stock required to be reserved for issuance upon
exercise of this Warrant or as otherwise provided hereunder require registration
or qualification with any Governmental Authority under any federal or state law
before such shares may be so issued, the Issuer will in good faith use its best
efforts as expeditiously as possible at its expense to cause such shares to be
duly registered or qualified.  If the Issuer shall list any shares of
Class A Common Stock on any securities exchange or market it will, at its
expense, list thereon, and maintain and increase when necessary such listing,
of, all shares of Warrant Stock from time to time issued upon exercise of this
Warrant or as otherwise provided hereunder (provided that such Warrant Stock has
been registered pursuant to a registration statement under the Securities Act
then in effect), and, to the extent permissible under the applicable securities
exchange rules, all unissued shares of Warrant Stock which are at any time
issuable hereunder, so long as any shares of Class A Common Stock shall be so
listed.  The Issuer will also so list on each securities exchange or
market, and will maintain such listing of, any other securities which the Holder
of this Warrant shall be entitled to receive upon the exercise of this Warrant
if at the time any securities of the same class shall be listed on such
securities exchange or market by the Issuer.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    
 

    (c)           Loss, Theft, Destruction of
Warrants.  Upon receipt of evidence satisfactory to the Issuer
of the ownership of and the loss, theft, destruction or mutilation of any
Warrant and, in the case of any such loss, theft or destruction, upon receipt of
indemnity or security satisfactory to the Issuer or, in the case of any such
mutilation, upon surrender and cancellation of such Warrant, the Issuer will
make and deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant,
a new Warrant of like tenor and representing the right to purchase the same
number of shares of Class A Common Stock.

    

    (d)           Payment of
Taxes.  The Issuer will pay any documentary stamp taxes
attributable to the initial issuance of the Warrant Stock issuable upon exercise
of this Warrant; provided, however, that the
Issuer shall not be required to pay any tax or taxes which may be payable in
respect of any transfer involved in the issuance or delivery of any certificates
representing Warrant Stock in a name other than that of the Holder in respect to
which such shares are issued.

    

    4.           Adjustment of Warrant Price
and Number of Shares Issuable Upon Exercise.  The Warrant Price
and the number of shares of Warrant Stock that may be purchased upon exercise of
this Warrant shall be subject to adjustment from time to time as set forth in
this Section 4. Upon each adjustment of the Warrant Price, the Holder of this
Warrant shall thereafter be entitled to purchase, at the Warrant Price resulting
from such adjustment, the number of shares of Class A Common Stock obtained by
multiplying the Warrant Price in effect immediately prior to such adjustment by
the number of shares purchasable pursuant hereto immediately prior to such
adjustment, and dividing the product thereof by the Warrant Price resulting from
such adjustment.

    

    (a)         
Adjustment Due to Dividends,
Stock Splits, Etc. If, at any time on or after the Original Issuance
Date, the number of outstanding shares of Class A Common Stock is increased by a
(i) dividend payable in any kind of shares of capital stock of the Corporation,
(ii) stock split, (iii) combination, (iv) reclassification or (v) other similar
event, the Conversion Price shall be proportionately reduced by multiplying the
Warrant Price by a fraction of which the numerator shall be the number of
outstanding shares of Class A Common Stock immediately before such event and of
which the denominator shall be the number of outstanding shares of Class A
Common Stock immediately after such event, or if the number of outstanding
shares of Class A Common Stock is decreased by a reverse stock split,
combination or reclassification of shares, or other similar event, the
Conversion Price shall be proportionately increased by multiplying the Warrant
Price by a fraction of which the numerator shall be the number of outstanding
shares of Class A Common Stock immediately before such event and of which the
denominator shall be the number of outstanding shares of Class A Common Stock
immediately after such event. In such event, the Issuer shall notify the
Corporation's Transfer Agent of such change on or before the effective date
thereof.

     

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    (b)         
Adjustment Due to Merger,
Consolidation, Etc. If, at any time after the Original Issuance Date,
there shall be (i) any reclassification or change of the outstanding shares of
Class A Common Stock, (ii) any consolidation or merger of the Corporation with
any other entity (other than a merger in which the Corporation is the surviving
or continuing entity and its capital stock is unchanged), (iii) any sale or
transfer of all or substantially all of the assets of the Corporation, (iv) any
share exchange or tender offer pursuant to which all of the outstanding shares
of Common Stock are effectively converted into other securities or property; or
(v) any distribution of the Corporation’s assets to holders of the Class A
Common Stock as a liquidation or partial liquidation dividend or by way of
return of capital (each of (i) - (v) above being a “Corporate Change”),
then the Holder shall have the right thereafter to receive, upon exercise of
this Warrant, the same amount and kind of securities, cash or property as it
would have been entitled to receive upon the occurrence of such Corporate Change
if it had been, immediately prior to such Corporate Change, the holder of the
number of shares of Warrant Stock then issuable upon exercise in full of this
Warrant, and in any such case, appropriate provisions (in form and substance
reasonably satisfactory to the Holder) shall be made with respect to the rights
and interests of the Holder to the end that the economic value of the Warrant
Stock is in no way diminished by such Corporate Change and that the provisions
hereof including, without limitation, in the case of any such consolidation,
merger or sale in which the successor entity or purchasing entity is not the
Issuer, an immediate adjustment of the Warrant Price so that the Warrant Price
immediately after the Corporate Change reflects the same relative value as
compared to the value of the surviving entity’s common stock that existed
immediately prior to such Corporate Change and the value of the Class A Common
Stock immediately prior to such Corporate Change.  If holders of Class
A Common Stock are given any choice as to the securities, cash or property to be
received in a Corporate Change, then the Holder shall be given the same choice
as to the consideration it receives upon any exercise of this Warrant following
such Corporate Change.

     

    (c)         
Adjustment Due to Dilutive
Issuances.  Except for any Qualified Issuance (as hereinafter
defined), if at any time the Issuer shall offer, issue or agree to issue any
Class A Common Stock or securities convertible into or exercisable for shares of
Class A Common Stock (or modify any of the foregoing which may be outstanding at
any time prior to the Issuance Date) to any person or entity at a price per
share or conversion or exercise price per share which shall be less than the
Warrant Price then in effect, then, for each such occasion, the Warrant Price
shall be adjusted to equal such other lower price per share, and, as to shares
of Class A Common Stock, if any, that were previously issued upon exercise of
this Warrant, the Issuer shall issue additional shares of Class A Common Stock
to the Holder so that the average per share purchase price of the shares of
Class A Common Stock issued to the Holder upon the exercise of the Warrant is
equal to such other lower price per share.  For purposes of this
Section “Qualified Issuance” shall mean (i) the grant,
issuance or exercise of any convertible securities pursuant to a qualified or
non-qualified stock option plan of the Issuer or any other bona fide employee
benefit plan or incentive arrangement, adopted or approved by the Board and
approved by the Issuer’s shareholders, as may be amended from time to time, (ii)
the grant, issuance or exercise of any convertible securities in connection with
the hire or retention of any officer, director or key employee of the Issuer,
provided such grant is approved by the Board, or (iii) the issuance of any
shares of Class A Common Stock pursuant to the grant or exercise of convertible
securities outstanding as of the date hereof (exclusive of any subsequent
amendments thereto).

     

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    (d)         
Other
Adjustments.  If the Issuer takes any action affecting the
Class A Common Stock after the date hereof that would be covered by this Section
4, but for the manner in which such action is taken or structured, and such
action would in any way diminish the value of the Warrant or Warrant Stock, then
the Warrant Price shall be adjusted in such manner as the Board shall in good
faith determine to be equitable under the circumstances.

     

    (e)         
Purchase
Rights.  In addition to any adjustments pursuant to subsections
(a)-(d) above, if at any time the Issuer are grants, issues or sells any
options, convertible securities or rights to purchase stock, warrants,
securities or other property pro rata to the record holders of any class of
shares of common stock (the “Purchase Rights”),
then the Holder will be entitled to acquire, upon the terms applicable to such
Purchase Rights, the aggregate Purchase Rights which the Holder could have
acquired if the Holder had held the proportionate number of shares of Class A
Common Stock acquirable upon complete exercise of this Warrant (without regard
to any limitations on the exercise of this Warrant) immediately before the date
on which a record is taken for the grant, issuance or sale of such Purchase
Rights, or, if no such record is taken, the date as of which the record holders
of shares of Class A Common Stock are to be determined for the grant, issue or
sale of such Purchase Rights.

     

    (f)          
Redemption
Right.  No sooner than fifteen (15) days nor later than ten
(10) days prior to the consummation of a Corporate Change that constitutes a
change of control, but not prior to the public announcement of such change of
control, the Issuer shall deliver written notice thereof via facsimile and
overnight courier to the Holder (a “Change in Control
Notice”).  At any time during the period beginning after the
Holder’s receipt of a Change of Control Notice and ending ten (10) Trading Days
after the consummation of such change of control, the Holder may require the
Issuer to redeem all or any portion of this Warrant by delivering written notice
thereof (“Change in
Control Redemption Notice”) to the Issuer, which Change of Control
Redemption Notice shall indicate the amount the Holder is electing to be
redeemed.  Any such redemption shall be in cash in the amount equal to
the value of the remaining unexercised portion of this Warrant on the date of
such consummation, which value shall be determined by use of the Black Scholes
Option Pricing Model reflecting (A) a risk-free interest rate corresponding to
the U.S.  Treasury rate for a period equal to the remaining term of
this Warrant as of such date of request and (B) an expected volatility equal to
the 100-day volatility obtained from the HVT function on Bloomberg for the
100-day period ending on the date of the Change of Control Redemption
Notice.

     

    5.        
   Notice of
Adjustments.  Whenever the Warrant Price or Warrant Share
Number shall be adjusted pursuant to Section 4 hereof (for purposes of this
Section 5, each an “adjustment”), the
Issuer shall cause its Chief Financial Officer to prepare and execute a
certificate setting forth, in reasonable detail, the event requiring the
adjustment, the amount of the adjustment, the method by which such adjustment
was calculated (including a description of the basis on which the Board made any
determination hereunder), and the Warrant Price and Warrant Share Number after
giving effect to such adjustment, and shall cause copies of such certificate to
be delivered to the Holder of this Warrant promptly after each
adjustment.  Any dispute between the Issuer and the Holder of this
Warrant with respect to the matters set forth in such certificate may at the
option of the Holder of this Warrant be submitted to a national or regional
accounting firm reasonably acceptable to the Issuer and the Holder, provided that the
Issuer shall have ten (10) days after receipt of notice from such Holder of its
selection of such firm to object thereto, in which case such Holder shall select
another such firm and the Issuer shall have no such right of
objection.  The firm selected by the Holder of this Warrant as
provided in the preceding sentence shall be instructed to deliver a written
opinion as to such matters to the Issuer and such Holder within thirty (30) days
after submission to it of such dispute.  Such opinion shall be final
and binding on the parties hereto.  The costs and expenses of the
initial accounting firm shall be paid equally by the Issuer and the Holder and,
in the case of an objection by the Issuer, the costs and expenses of the
subsequent accounting firm shall be paid in full by the Issuer.

     

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    
 

    6.     
      Fractional
Shares.  No fractional shares of Warrant Stock will be issued
in connection with any exercise hereof, but in lieu of such fractional shares,
the Issuer shall round the number of shares to be issued upon exercise up to the
nearest whole number of shares.

    

    7.         
  Ownership
Caps and Certain Exercise Restrictions.

     

    (a)  Notwithstanding
anything to the contrary set forth in this Warrant, at no time may a Holder of
this Warrant exercise any portion of this Warrant if the number of shares of
Class A Common Stock to be issued pursuant to such exercise would exceed, when
aggregated with all other shares of Class A Common Stock beneficially owned by
such Holder at such time, the number of shares of Class A Common Stock which
would result in such Holder beneficially owning (as determined in accordance
with Section 13(d) of the Exchange Act and the rules  thereunder) in
excess of 4.99% of the then issued and outstanding shares of Class A Common
Stock; provided, however, that upon a
holder of this Warrant providing the Issuer with sixty-one (61) days notice
(pursuant to Section 12 hereof) (the “Waiver Notice”) that
such Holder would like to waive this Section 7(a) with regard to any or all
shares of Class A Common Stock issuable upon exercise of this Warrant, this
Section 7(a) will be of no force or effect with regard to all or a portion of
the Warrant referenced in the Waiver Notice; provided, further, that this
provision shall be of no further force or effect during the sixty-one (61) days
immediately preceding the expiration of the term of this Warrant.  In
all circumstances, exercise of this Warrant shall be deemed to be the Holder’s
representation that such exercise conforms to the provisions of this Section
7(a) and the Issuer shall be under no obligation to verify or ascertain
compliance by the Holder with this provision.

    

    (b) The
Holder may not exercise the Warrant hereunder to the extent such exercise would
result in the Holder beneficially owning (as determined in accordance with
Section 13(d) of the Exchange Act and the rules thereunder) in excess of 9.99%
of the then issued and outstanding shares of Class A Common Stock, including
shares issuable upon exercise of the Warrant held by the Holder after
application of this Section; provided, however, that upon a
holder of this Warrant providing the Issuer with a Waiver Notice that such
holder would like to waive this Section 7(b) with regard to any or all shares of
Class A Common Stock issuable upon exercise of this Warrant, this Section 7(b)
shall be of no force or effect with regard to those shares of Warrant Stock
referenced in the Waiver Notice; provided, further, that this
provision shall be of no further force or effect during the sixty-one (61) days
immediately preceding the expiration of the term of this Warrant.  In
all circumstances, exercise of this Warrant shall be deemed to be the Holder’s
representation that such exercise conforms to the provisions of this Section
7(b) and the Issuer shall be under no obligation to verify or ascertain
compliance by the Holder with this provision.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    
 

    8.           Definitions.  For
the purposes of this Warrant, the following terms have the following
meanings:

    

    “Additional Shares of Common
Stock” means all shares of Class A Common Stock issued by the Issuer
after the Original Issue Date, and all shares of Other Common, if any, issued by
the Issuer after the Original Issue Date, except for those issued in a Permitted
Financing.

    

    “Board” shall mean the
Board of Directors of the Issuer.

    

    “Capital Stock” means
and includes (i) any and all shares, interests, participations or other
equivalents of or interests in (however designated) corporate stock, including,
without limitation, shares of preferred or preference stock, (ii) all
partnership interests (whether general or limited) in any Person which is a
partnership, (iii) all membership interests or limited liability company
interests in any limited liability company, and (iv) all equity or ownership
interests in any Person of any other type.

    

    “Certificate of
Incorporation” means the Certificate of Incorporation of the Issuer as in
effect on the Original Issue Date, and as hereafter from time to time amended,
modified, supplemented or restated in accordance with the terms hereof and
thereof and pursuant to applicable law.

    

    “Class A Common Stock”
means the Class A Common Stock, $0.001 par value per share, of the Issuer and
any other Capital Stock into which such stock may hereafter be
changed.

    

    “Governmental
Authority” means any governmental, regulatory or self-regulatory entity,
department, body, official, authority, commission, board, agency or
instrumentality, whether federal, state or local, and whether domestic or
foreign.

    

    “Holders” mean the
Persons who shall from time to time own any Warrant.  The term
“Holder” means one of the Holders.

    

    “Independent
Appraiser” means a nationally recognized or major regional investment
banking firm or firm of independent certified public accountants of recognized
standing (which may be the firm that regularly examines the financial statements
of the Issuer) that is regularly engaged in the business of appraising the
Capital Stock or assets of corporations or other entities as going concerns, and
which is not affiliated with either the Issuer or the Holder of any
Warrant.

     

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    
 

    “Issuer” means The
Amacore Group, Inc., a Delaware corporation, and its successors.

    

    “Original Issue Date”
means October 6, 2008.

    

    “OTC Bulletin Board”
means the over-the-counter electronic bulletin board.

    

    “Other Common” means
any other Capital Stock of the Issuer of any class which shall be authorized at
any time after the date of this Warrant (other than Class A Common Stock) and
which shall have the right to participate in the distribution of earnings and
assets of the Issuer without limitation as to amount.

    

    “Outstanding Common
Stock” means, at any given time, the aggregate amount of outstanding
shares of Class A Common Stock, assuming full exercise, conversion or exchange
(as applicable) of all options, warrants and other Securities which are
convertible into or exercisable or exchangeable for, and any right to subscribe
for, shares of Class A  Common Stock that are outstanding at such
time.

    

    “Person” means an
individual, corporation, limited liability company, partnership, joint stock
company, trust, unincorporated organization, joint venture, Governmental
Authority or other entity of whatever nature.

    

    “Per Share Market
Value” means on any particular date (a) the last closing bid price per
share of the Class A Common Stock on such date on the OTC Bulletin Board or
another registered national stock exchange on which the Class A Common Stock is
then listed, or if there is no such price on such date, then the closing bid
price on such exchange or quotation system on the date nearest preceding such
date, or (b) if the Class A Common Stock is not listed then on the OTC Bulletin
Board or any registered national stock exchange, the last closing bid price for
a share of Class A Common Stock in the over-the-counter market, as reported by
the OTC Bulletin Board or in the National Quotation Bureau Incorporated or
similar organization or agency succeeding to its functions of reporting prices)
at the close of business on such date, or (c) if the Class A Common Stock is not
then reported by the OTC Bulletin Board or the National Quotation Bureau
Incorporated (or similar organization or agency succeeding to its functions of
reporting prices), then the “Pink Sheet” quotes for the applicable Trading Days
preceding such date of determination, or (d) if the Class A Common Stock is not
then publicly traded the fair market value of a share of Class A Common Stock as
determined by an Independent Appraiser selected in good faith by the Holder;
provided, however, that the
Issuer, after receipt of the determination by such Independent Appraiser, shall
have the right to select an additional Independent Appraiser, in which case, the
fair market value shall be equal to the average of the determinations by each
such Independent Appraiser; and provided, further that all
determinations of the Per Share Market Value shall be appropriately adjusted for
any stock dividends, stock splits or other similar transactions during such
period.  The determination of fair market value by an Independent
Appraiser shall be based upon the fair market value of the Issuer determined on
a going concern basis as between a willing buyer and a willing seller and taking
into account all relevant factors determinative of value, and the determination
of the additional Independent Appraiser, if any, or of the Independent
Appraisers otherwise shall be final and binding on all parties.  In
determining the fair market value of any shares of Class A Common Stock, no
consideration shall be given to any restrictions on transfer of the Class A
Common Stock imposed by agreement or by federal or state securities laws, or to
the existence or absence of, or any limitations on, voting rights.

     

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    
 

    “Purchase Agreement”
means the Securities Purchase Agreement dated as of October 6, 2008, among the
Issuer and the Holder.

    

    “Securities” means any
debt or equity securities of the Issuer, whether now or hereafter authorized,
any instrument convertible into or exchangeable for Securities or a Security,
and any option, warrant or other right to purchase or acquire any
Security.  “Security” means one of the Securities.

    

    “Securities Act” means
the Securities Act of 1933, as amended, or any similar federal statute then in
effect.

    

    “Subsidiary” means any
corporation at least 50% of whose outstanding Voting Stock shall at the time be
owned directly or indirectly by the Issuer or by one or more of its
Subsidiaries, or by the Issuer and one or more of its Subsidiaries.

    

    “Term” has the meaning
specified in Section 1 hereof.

    

    “Trading Day” means
(a) a day on which the Class A Common Stock is traded on the OTC Bulletin Board,
or (b) if the Class A Common Stock is not traded on the OTC Bulletin Board, a
day on which the Class A Common Stock is quoted in the over-the-counter market
as reported by the National Quotation Bureau Incorporated (or any similar
organization or agency succeeding its functions of reporting prices); provided, however, that in the
event that the Class A Common Stock is not listed or quoted as set forth in (a)
or (b) hereof, then Trading Day shall mean any day except Saturday, Sunday and
any day which shall be a legal holiday or a day on which banking institutions in
the State of New York are authorized or required by law or other government
action to close.

    

    “Voting Stock” means,
as applied to the Capital Stock of any corporation, Capital Stock of any class
or classes (however designated) having ordinary voting power for the election of
a majority of the members of the Board of Directors (or other governing body) of
such corporation, other than Capital Stock having such power only by reason of
the happening of a contingency.

    

    “Warrants” means the
Warrants issued and sold pursuant to the Purchase Agreement, including, without
limitation, this Warrant, and any other warrants of like tenor issued in
substitution or exchange for any thereof pursuant to the provisions of Section
2(c), 2(d) or 2(e) hereof or of any of such other Warrants.

     

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    
 

    “Warrant Price”
initially means $0.375, as such price may be adjusted from time to time as shall
result from the adjustments specified in this Warrant, including Section 4
hereto.

    

    “Warrant Share Number”
means at any time the aggregate number of shares of Warrant Stock which may at
such time be purchased upon exercise of this Warrant, after giving effect to all
prior adjustments and increases to such number made or required to be made under
the terms hereof.

    

    “Warrant Stock” means
Class A Common Stock issuable upon exercise of any Warrant or Warrants or
otherwise issuable pursuant to any Warrant or Warrants.

    

    9.           Other
Notices.  In case at any time:

    

    
      	
               
      

            	
              (a)

            	
              the
      Issuer shall make any distributions to the holders of Class A Common
      Stock; or

            

    

    

    
      	
               
      

            	
              (b)

            	
              the
      Issuer shall authorize the granting to all holders of its Class A Common
      Stock of rights to subscribe for or purchase any shares of Capital Stock
      of any class or other rights; or

            

    

    

    
      	
               
      

            	
              (c)

            	
              there
      shall be any reclassification of the Capital Stock of the Issuer;
      or

            

    

    

    
      	
               
      

            	
              (d)

            	
              there
      shall be any capital reorganization by the Issuer;
  or

            

    

    

    
      	
               
      

            	
              (e)

            	
              there
      shall be any (i) consolidation or merger involving the Issuer or (ii)
      sale, transfer or other disposition of all or substantially all of the
      Issuer’s property, assets or business (except a merger or other
      reorganization in which the Issuer shall be the surviving corporation and
      its shares of Capital Stock shall continue to be outstanding and unchanged
      and except a consolidation, merger, sale, transfer or other disposition
      involving a wholly-owned subsidiary);
or

            

    

    

    
      	
               
      

            	
              (f)

            	
              there
      shall be a voluntary or involuntary dissolution, liquidation or winding-up
      of the Issuer or any partial liquidation of the Issuer or distribution to
      holders of Class A Common Stock;

            

    

    

    then, in
each of such cases, the Issuer shall give written notice to the Holder of the
date on which (i) the books of the Issuer shall close or a record shall be taken
for such dividend, distribution or subscription rights or (ii) such
reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be, shall take
place.  Such notice also shall specify the date as of which the
holders of Class A Common Stock of record shall participate in such dividend,
distribution or subscription rights, or shall be entitled to exchange their
certificates for Class A Common Stock for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
disposition, dissolution, liquidation or winding-up, as the case may
be.  Such notice shall be given at least twenty (20) days prior to the
action in question and not less than ten (10) days prior to the record date or
the date on which the Issuer’s transfer books are closed in respect
thereto.  This Warrant entitles the Holder to receive copies of all
financial and other information distributed or required to be distributed to the
holders of the Class A Common Stock.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    
 

    10.           Amendment and
Waiver.  Any term, covenant, agreement or condition in this
Warrant may be amended, or compliance therewith may be waived (either generally
or in a particular instance and either retroactively or prospectively), by a
written instrument or written instruments executed by the Issuer and the Holder;
provided, however, that no such
amendment or waiver shall reduce the Warrant Share Number, increase the Warrant
Price, shorten the period during which this Warrant may be exercised or modify
any provision of this Section 10 without the consent of the Holder of this
Warrant.  No consideration shall be offered or paid to any person to
amend or consent to a waiver or modification of any provision of this Warrant
unless the same consideration is also offered to all holders of the
Warrants.

    

    11.           Governing Law;
Jurisdiction.  This Warrant shall be governed by and construed
in accordance with the internal laws of the State of New York, without giving
effect to any of the conflicts of law principles which would result in the
application of the substantive law of another jurisdiction.  This
Warrant shall not be interpreted or construed with any presumption against the
party causing this Warrant to be drafted.  The Issuer and the Holder
agree that venue for any dispute arising under this Warrant will lie exclusively
in the state or federal courts located in New York County, New York, and the
parties irrevocably waive any right to raise forum non conveniens or any
other argument that New York is not the proper venue.  The Issuer and
the Holder irrevocably consent to personal jurisdiction in the state and federal
courts of the state of New York.  The Issuer and the Holder consent to
process being served in any such suit, action or proceeding by mailing a copy
thereof to such party at the address in effect for notices to it under this
Warrant and agrees that such service shall constitute good and sufficient
service of process and notice thereof.  Nothing in this Section 11
shall affect or limit any right to serve process in any other manner permitted
by law.  The Issuer agrees to pay all costs and expenses of
enforcement of this Warrant, including, without limitation, reasonable
attorneys’ fees and expenses.  The parties hereby waive all rights to
a trial by jury.

    

    12.           Notices.  Any
notice, demand, request, waiver or other communication required or permitted to
be given hereunder shall be in writing and shall be effective (a) upon hand
delivery by telecopy or facsimile at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the second business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur.  The
addresses for such communications shall be as set forth in the Purchase
Agreement.  Any party hereto may from time to time change its address
for notices by giving written notice of such changed address to the other party
hereto.

     

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    
 

    13.           Warrant
Agent.  The Issuer may, by written notice to each Holder of
this Warrant, appoint an agent having an office in New York, New York for the
purpose of issuing shares of Warrant Stock on the exercise of this Warrant
pursuant to subsection (b) of Section 2 hereof, exchanging this Warrant pursuant
to subsection (d) of Section 2 hereof or replacing this Warrant pursuant to
subsection (d) of Section 3 hereof, or any of the foregoing, and thereafter any
such issuance, exchange or replacement, as the case may be, shall be made at
such office by such agent.

    

    14.           Remedies.  The
Issuer stipulates that the remedies at law of the Holder of this Warrant in the
event of any default or threatened default by the Issuer in the performance of
or compliance with any of the terms of this Warrant are not and will not be
adequate and that, to the fullest extent permitted by law, such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.

    

    15.           Successors and
Assigns.  This Warrant and the rights evidenced hereby shall
inure to the benefit of and be binding upon the successors and assigns of the
Issuer, the Holder hereof and (to the extent provided herein) the Holders of
Warrant Stock issued pursuant hereto, and shall be enforceable by any such
Holder or Holder of Warrant Stock.

    

    16.           Modification and
Severability.  If, in any action before any court or agency
legally empowered to enforce any provision contained herein, any provision
hereof is found to be unenforceable, then such provision shall be deemed
modified to the extent necessary to make it enforceable by such court or
agency.  If any such provision is not enforceable as set forth in the
preceding sentence, the unenforceability of such provision shall not affect the
other provisions of this Warrant, but this Warrant shall be construed as if such
unenforceable provision had never been contained herein.

    

    17.           Headings.  The
headings of the Sections of this Warrant are for convenience of reference only
and shall not, for any purpose, be deemed a part of this Warrant.

    

    18.           Registration
Rights.  The Holder of this Warrant is entitled to the benefit
of certain registration rights with respect to the shares of Warrant Stock
issuable upon the exercise of this Warrant pursuant to that certain Registration
Rights Agreement, dated October 6, 2008, by and among the Issuer and the Holder
(the “Registration
Rights Agreement”) and the registration rights with respect to the shares
of Warrant Stock issuable upon the exercise of this Warrant by any subsequent
Holder may only be assigned in accordance with the terms and provisions of the
Registrations Rights Agreement.

    

    [REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]

     

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    
 

    

    IN
WITNESS WHEREOF, the Issuer has executed this Warrant as of the day and year
first above written.

     

     

     

    
      
        	 	THE
      AMACORE GROUP, INC.	 
	 	 	 	 
	
                 

              	
                By:
      

              	/s/ Jay
      Shafer	 
	 	 	Name:
      Jay Shafer	 
	 	 	Title: President
      and Chief Executive Officer	 
	 	 	 	 

      

    

     

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

     

    WARRANT
EXERCISE FORM

    

    THE
AMACORE GROUP, INC.

    

    The
undersigned _______________, pursuant to the provisions of the within Warrant,
hereby elects to purchase _____ shares of Class A Common Stock of The Amacore
Group, Inc. covered by the within Warrant.

    

    
      
        	
                Dated:
      _________________

              	 
      	
                Signature

              	
                ___________________________

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                Address

              	
                _____________________

              
	 
      	 
      	 
      	
                _____________________

              

      

    

     

    

    Number of
shares of Class A Common Stock beneficially owned or deemed beneficially owned
by the Holder on the date of Exercise: _________________________

    

    The
undersigned is an “accredited investor” as defined in Regulation D under the
Securities Act of 1933, as amended.

     

    
      	
               
      

            	
              The
      undersigned intends that payment of the Warrant Price shall be made as
      (check one):

            

    

     

    Cash
Exercise_______

     

    Cashless
Exercise_______

     

    If the
Holder has elected a Cash Exercise, the Holder shall pay the sum of $________ by
certified or official bank check (or via wire transfer) to the Issuer in
accordance with the terms of the Warrant.

     

    If the
Holder has elected a Cashless Exercise, a certificate shall be issued to the
Holder for the number of shares equal to the whole number portion of the product
of the calculation set forth below, which is ___________.   The
Company shall pay a cash adjustment in respect of the fractional portion of the
product of the calculation set forth below in an amount equal to the product of
the fractional portion of such product and the Per Share Market Value on the
date of exercise, which product is ____________.

     

    

    

    

    
      Where:

    

    

    
      The
number of shares of Class A Common Stock to be issued to the Holder
__________________(“X”).

    

    

    The
number of shares of Class A Common Stock purchasable upon exercise of all of the
Warrant or, if only a portion of the Warrant is being exercised, the portion of
the Warrant being exercised ___________________________ (“Y”).

     

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    
 

    
      The
Warrant Price ______________ (“A”).

    

    

    The Per
Share Market Value of one share of Class A Common
Stock  _______________________ (“B”).

    

    

    ASSIGNMENT

    

    FOR VALUE
RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the within Warrant and all rights evidenced thereby and does
irrevocably constitute and appoint _____________, attorney, to transfer the said
Warrant on the books of the within named corporation.

    

    
      
        	
                Dated:
      _________________

              	 
      	
                Signature

              	
                ___________________________

              
	 
      	 
      	 
      	 
      
	 
      	 
      	
                Address

              	
                _____________________

              
	 
      	 
      	 
      	
                _____________________

              

      

    PARTIAL
ASSIGNMENT

    

    FOR VALUE
RECEIVED, _________________ hereby sells, assigns and transfers unto
__________________ the right to purchase _________ shares of Warrant Stock
evidenced by the within Warrant together with all rights therein, and does
irrevocably constitute and appoint ___________________, attorney, to transfer
that part of the said Warrant on the books of the within named
corporation.

     

    
      

      
        
          	
                  Dated:
      _________________

                	 
      	
                  Signature

                	
                  ___________________________

                
	 
      	 
      	 
      	 
      
	 
      	 
      	
                  Address

                	
                  _____________________

                
	 
      	 
      	 
      	
                  _____________________

                

        

    FOR USE
BY THE ISSUER ONLY:

    

    This
Warrant No. W-___ canceled (or transferred or exchanged) this _____ day of
___________, _____, shares of Class A Common Stock issued therefor in the name
of _______________, Warrant No. W-_____ issued for ____ shares of Class A Common
Stock in the name of _______________.

     

     

     

     

     

     

    -19-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00148-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00148-of-00352.parquet"}]]