Document:

Execution
        Copy

       

      

      

       

      AGREEMENT
        AND PLAN
        OF MERGER

      

      BY
        AND
        AMONG

      

      TIX
        CORPORATION, 

      A
        DELAWARE CORPORATION, 

      

      AND

      

      NEWSPACE
        ACQUISITION, INC.,

      A
        UTAH
        CORPORATION,

      

      ON
        THE
        ONE HAND,

      

      AND

      

      NEWSPACE
        ENTERTAINMENT, INC.,

      A
        UTAH
        CORPORATION,

      

      JOHN
        BALLARD,

      

      STEVE
        BOULAY,

      

      AND

      

      BRUCE
        GRANATH,

      

      ON
        THE
        OTHER HAND

      

      

      DATED
        AS
        OF MARCH __, 2008

       

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      AGREEMENT
        AND PLAN OF MERGER

       

      This
        AGREEMENT AND PLAN OF MERGER (this “Agreement”)
        is
        made and entered into as of March __, 2008, by and among Tix Corporation,
        a
        Delaware corporation (“Parent”),
        and
        NewSpace Acquisition, Inc., a Utah corporation and wholly owned subsidiary
        of
        Parent (“Merger
        Sub”),
        on
        the one hand, and, on the other hand, NewSpace Entertainment, Inc., a Utah
        corporation (the “Company”),
        John
        Ballard (“Ballard”),
        Steve
        Boulay (“Boulay”)
        and
        Bruce Granath (“Granath,”
and
        together with Ballard and Boulay, the “Selling
        Stockholders”).
        Parent, Merger Sub and the Company are collectively referred to herein as
        the
“Parties,”
and
        each is a “Party.”
        Capitalized terms used and not otherwise defined herein have the meanings
        set
        forth in Article 1. 

       

      RECITALS

       

      WHEREAS,
        the Boards of Directors of Parent, Merger Sub and the Company have each
        determined that it is the best interests of their respective corporations
        and
        stockholders that Parent, Merger Sub and the Company enter into a business
        combination transaction;

       

      WHEREAS,
        the Boards of Directors of each of Parent, Merger Sub and the Company have
        adopted and approved, as the case may be, this Agreement, the merger of the
        Company with and into Merger Sub (the “Merger”)
        in
        accordance with the provisions of the Utah
        Revised Business Corporation Act (the
        “URBCA”),
        and
        the terms and conditions set forth herein;

       

      WHEREAS,
        the Board of Directors of the Company has determined to recommend to the
        Company’s stockholders the approval and adoption of this Agreement and the
        Merger; 

       

      WHEREAS,
        the Selling Stockholders are the sole stockholders of the Company and will
        benefit from the transactions contemplated herein;

       

      WHEREAS,
        for U.S. federal income tax purposes, it is intended that the Merger shall
        qualify as a reorganization within the meaning of Section 368(a) of the Internal
        Revenue Code of 1986, as amended (the “Code”),
        and
        that this Agreement shall constitute a plan of reorganization within the
        meaning
        of Sections 1.368-2(g) and 1.368-3(a) of the Treasury Regulations and each
        of
        Parent, Merger Sub, and the Company will be a party to a reorganization within
        the meaning of Section 368(c) of the Code; and

       

      WHEREAS,
        in connection with the Merger, the Parties desire to make certain
        representations, warranties, covenants and agreements and also to prescribe
        various conditions to the Merger, upon the terms and subject to the conditions
        contained herein.

       

      NOW,
        THEREFORE, in consideration of the covenants, promises, representations and
        warranties set forth herein, and for other good and valuable consideration,
        intending to be legally bound hereby the parties agree as follows:

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      ARTICLE
        1

      DEFINITIONS

       

      1.1 Certain
        Definitions.
        The
        following terms shall, when used in this Agreement, have the following
        meanings:

       

      “Affiliate”
means,
        with respect to any Person: (i) any Person directly or indirectly owning,
        controlling or holding with power to vote ten percent (10%) or more of the
        outstanding voting securities of such other Person (other than passive or
        institutional investors); (ii) any Person ten percent (10%) or more of whose
        outstanding voting securities are directly or indirectly owned, controlled
        or
        held with power to vote, by such other Person; (iii) any Person directly
        or
        indirectly controlling, controlled by or under common control with such other
        Person; and (iv) any officer, director or partner of such other Person.
“Control” for the foregoing purposes shall mean the possession, directly or
        indirectly, of the power to direct or cause the direction of the management
        and
        policies of a Person, whether through the ownership of voting securities
        or
        voting interests, by contract or otherwise;

       

      “Agreement”
shall
        have the meaning set forth in the Recitals of this Agreement;

       

      “Alternative
        Acquisition”
shall
        have the meaning set forth in Section 5.8 of this Agreement;

       

      “Ancillary
        Agreements”
means
        the Key Employee Agreements and the Disclosure Schedules to this
        Agreement;

       

      “Articles
        of Merger”
shall
        have the meaning set forth in Section 2.3 of this Agreement;

       

      “Ballard”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      “Boulay”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      “Ballard
        Employment Agreement”
shall
        have the meaning set forth in Section 5.1 of this Agreement;

       

      “Boulay
        Employment Agreement”
shall
        have the meaning set forth in Section 5.1 of this Agreement;

       

      “Benefit
        Arrangement”
means
        any employment, consulting, severance or other similar contract, plan,
        arrangement or policy, and each plan, arrangement (written or oral), program,
        agreement or commitment providing for insurance coverage (including any
        self-insured arrangements), workers’ compensation, disability benefits,
        supplemental unemployment benefits, vacation benefits, retirement benefits,
        life, health, disability or accident benefits or for deferred compensation,
        profit-sharing bonuses, stock options, stock purchases or other forms of
        incentive compensation or post-retirement insurance, compensation or benefits
        which (A) is not a Welfare Plan, Pension Plan or Multi-employer Plan, and
        (B) is
        entered into, maintained, contributed to or required to be contributed to,
        by
        the Company or an ERISA Affiliate or under which the Company or any ERISA
        Affiliate may incur any liability;

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      “Business”
shall
        mean the production, promotion, exhibition and touring of Broadway shows,
        events
        and other transactions, including without limitation, the promotion of Broadway
        shows and series in Akron, Albuquerque, Boise, Colorado Springs, Eugene,
        Fresno,
        Kalamazoo and Salt Lake City; the exhibition and tours of Broadway shows
        and
        other attractions nationwide in Canada through a joint venture with Canada
        Theatricals Live; and the promotion of Broadway shows, attractions and events
        throughout North America.

       

      “Business
        Day”
means
        any
        day
        other than Saturday, Sunday or a day on which banking institutions in Los
        Angeles, California, are required or authorized to be closed;

       

      “Claim”
shall
        have the meaning set forth in Section 8.4 of this Agreement;

       

      “Claim
        Notice”
shall
        have the meaning set forth in Section 8.4 of this Agreement;

       

      “Closing”
shall
        have the meaning set forth in Section 2.2 of this Agreement;

       

      “Closing
        Date”
shall
        have the meaning set forth in Section 2.2 of this Agreement;

       

      “Company”
shall
        have the meaning set forth in the preamble of this Agreement;

       

      “Company
        Certificate(s)”
shall
        have the meaning set forth in Section 2.5(b) of this Agreement;

       

      “Company
        Common Stock”
shall
        have the meaning ascribed to it in Section 2.5(a) of this
        Agreement;

       

      “Company
        Financial Statements”
        shall
        have the meaning set forth in Section 3.7 of this Agreement;

       

      “Company
        Indemnified Parties”
shall
        have the meaning set forth in Section 8.2(b) of this Agreement;

       

      “Company
        Financial Statement Date”
        means
        December 31, 2007;

       

      “Contract”
means
        any agreement, contract, note, loan, evidence of indebtedness, purchase order,
        letter of credit, indenture, security or pledge agreement, covenant not to
        compete, license, instrument, commitment, obligation, promise or undertaking
        (whether written or oral and whether express or implied) to which the Company
        is
        a party or is bound and which relates to the Business;

       

      “Effective
        Time”
shall
        have the meaning set forth in Section 2.3 of this Agreement;

       

      “Effective
        Date”
shall
        have the meaning set forth in Section 2.3 of this Agreement;

       

      “Employee
        Plans”
means
        all Benefit Arrangements, Pension Plans and Welfare Plans;

       

      “ERISA”
shall
        mean the Employee Retirement Income Security Act of 1974, as
        amended;

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      “Family
        Member”
means,
        with respect to any individual (i) the individual, (ii) the individual’s spouse,
        (iii) any other natural Person who is related to the individual or the
        individual’s spouse within the second degree (including adopted children) and
        (iv) any other natural Person who resides with such individual;

       

      “GAAP”
means
        U.S. generally accepted accounting principles consistently applied, as in
        effect
        from time to time;

       

      “Granath”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      “Granath
        Employment Agreement”
shall
        have the meaning set forth in Section 5.1 of this Agreement;

       

      “Indemnification
        Threshold”
shall
        have the meaning set forth in Section 8.3 of this Agreement;

       

      “Intellectual
        Property”
means
        all trademarks and trademark rights, trade names and trade name rights, service
        marks and service mark rights, service names and service name rights, patents
        and patent rights, utility models and utility model rights, copyrights, mask
        work rights, brand names, trade dress, product designs, product packaging,
        business and product names, logos, slogans, rights of publicity, trade secrets,
        inventions (whether patentable or not), invention disclosures, improvements,
        processes, formulae, industrial models, processes, designs, specifications,
        technology, methodologies, computer software (including all source code and
        object code), firmware, development tools, flow charts, annotations, all
        Web
        addresses, sites and domain names, all data bases and data collections and
        all
        rights therein, any other confidential and proprietary right or information,
        whether or not subject to statutory registration, and all related technical
        information, the information set forth in manufacturing, engineering and
        technical drawings, know-how and all pending applications for and registrations
        of patents, utility models, trademarks, service marks and copyrights, and
        the
        right to sue for past infringement, if any, in connection with any of the
        foregoing;

       

      “Key
        Employee Agreements”
shall
        have the meaning set forth in Section 5.1 of this Agreement;

       

      “Knowledge”
means
        and an individual shall be deemed to have “Knowledge” of a particular fact or
        other matter if such individual is actually aware of such fact or other matter.
        A Person (other than an individual and other than Selling Stockholders) shall
        be
        deemed to have “Knowledge” of a particular fact or other matter if any
        individual who is serving, or who has at any time served as a director or
        officer of such Person (or in any similar capacity) has, or at any time had,
        Knowledge of such fact or other matter.

       

      “Laws”
means
        any statute, ordinance, law, rule, regulation, code, injunction, judgment,
        order, decree, ruling, or other requirement enacted, adopted or applied by
        any
        Regulatory Authority, including judicial decisions applying common law or
        interpreting any other Law;

       

      “Leases”
means
        all of the existing leases of the Company listed on Schedule
        3.11(a)
        hereto;

       

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      “Legal
        Proceeding”
means
        any action, arbitration, audit, hearing, investigation, litigation or suit
        (whether civil, criminal, administrative, investigative or informal) commenced,
        brought, conducted or heard by or before, or otherwise involving, any Regulatory
        Authority or arbitrator;

       

      “Liabilities”
means
        any direct or indirect liability, indebtedness, obligation, commitment, expense,
        claim, deficiency, guaranty or endorsement of or by any Person of any type,
        whether known or unknown, accrued, absolute, contingent, matured, unmatured,
        liquidated or unliquidated or otherwise;

       

      “Licensed
        Proprietary Rights”
shall
        have the meaning set forth in Section 3.10(a) of this Agreement;

       

      “Lien”
means
        any material mortgage, pledge, lien, encumbrance, charge, security interest,
        security agreement, conditional sale or other title retention agreement,
        limitation, option, assessment, restrictive agreement, restriction, adverse
        interest, restriction on transfer or exception to or material defect in title
        or
        other ownership interest (including but not limited to restrictive covenants,
        leases and licenses);

       

      “Losses”
means
        any claim, liability, obligation, loss, damage, assessment, penalty, judgment,
        settlement, cost and expense, including costs attributable to the loss of
        the
        use of funds to the date on which a payment is made with respect to a matter
        of
        indemnification under Article 8 hereof, and including reasonable attorneys’ and
        accountants’ fees and disbursements incurred in investigating, preparing,
        defending against or prosecuting any claim;

       

      “Material
        Adverse Effect”
or
        “Material
        Adverse Change”
means
        a
        material adverse effect on (i) the assets, liabilities, properties or business
        of the Parties, (ii) the validity, binding effect or enforceability of this
        Agreement or the Ancillary Agreements or (iii) the ability of any Party to
        perform its obligations under this Agreement and the Ancillary Agreements;
        provided,
        however,
        that
        none of the following shall constitute a Material Adverse Effect on the Company:
        (i) the filing, initiation and subsequent prosecution, by or on behalf of
        stockholders of any Party, of litigation that challenges or otherwise seeks
        damages with respect to the Merger, this Agreement and/or transactions
        contemplated thereby or hereby, (ii) occurrences due to a disruption of a
        Party’s business as a result of the announcement of the execution of this
        Agreement or changes caused by the taking of action required by this Agreement,
        (iii) general economic conditions, or (iv) any changes generally affecting
        the
        industries in which a Party operates;

       

      “Merger”
shall
        have the meaning set forth in the Recitals of this Agreement;

       

      “Merger
        Cash Consideration”
shall
        have the meaning set forth in Section 2.5(a) of this Agreement;

       

      “Merger
        Consideration”
shall
        have the meaning set forth in Section 2.5(a) of this Agreement;

       

      “Merger
        Stock Consideration”
shall
        have the meaning set forth in Section 2.5(a) of this Agreement;

       

      “Merger
        Sub”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

      “Multiemployer
        Plan”
means
        any “multiemployer plan” as defined in Section
        3(37)
        of
        ERISA.

       

      “Order”
means
        any writ, judgment, decree, ruling, injunction or similar order of any
        Regulatory Authority (in each such case whether preliminary or final);

       

      “Ordinary
        Course of Business”
or
        “ordinary
        course”
or
        any
        similar phrase means the usual and ordinary course of business of the Company,
        consistent with its past custom and practice;

       

      “Owned
        Proprietary Rights”
shall
        have the meaning set forth in Section 3.10(a) of this Agreement;

       

      “Parent”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      “Parent
        Common Stock”
shall
        have the meaning set forth in Section 2.5(a) of this Agreement; 

       

      “Parent
        Indemnified Parties”
shall
        have the meaning set forth in Section 8.2(a) of this Agreement;

       

      “Party”
or
        “Parties”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      “Pension
        Plan”
means
        any “employee pension benefit plan” as defined in Section
        3(2)
        of ERISA
        (other than a Multiemployer Plan) which the Company or any ERISA Affiliate
        maintains, administers, contributes to or is required to contribute to, or
        has
        maintained, administered, contributed to or was required to contribute to,
        or
        under which the Company or any ERISA Affiliate may incur any
        liability;

       

      “Permit”
means
        any license, franchise, certificate, declaration, waiver, exemption, variance,
        permit, consent, approval, registration, authorization, qualification or
        similar
        right granted by a Regulatory Authority;

       

      “Person”
means
        any
        natural person, individual, firm, corporation, including a non-profit
        corporation, partnership, trust, unincorporated organization, association,
        limited liability company, labor union, Regulatory Authority or other
        entity;

       

      “Regulatory
        Authority”
means:
        any (i) federal, state, local, municipal or foreign government; (ii)
        governmental or quasi-governmental authority of any nature (including without
        limitation any governmental agency, branch, department, official,
        instrumentality or entity and any court or other tribunal; (iii) multi-national
        organization or body; or (iv) body exercising or entitled to exercise any
        administrative, executive, judicial, legislative, police, regulation or taxing
        authority or power of any nature;

       

      “Representatives”
shall
        have the meaning set forth in Section 5.8 of this Agreement;

       

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

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      “Selling
        Stockholders”
shall
        have the meaning set forth in the preamble to this Agreement;

       

      “Stock
        Power”
shall
        have the meaning set forth in Section 2.7 of this Agreement;

       

      “Subsidiary”
of
        a
        specified Person means (a) any Person if securities having ordinary voting
        power
        (at the time in question and without regard to the happening of any contingency)
        to elect a majority of the directors, trustees, managers or other governing
        body
        of such Person are held or controlled by the specified Person or a Subsidiary
        of
        the specified Person; (b) any Person in which the specified Person and its
        subsidiaries collectively hold a fifty percent (50%) or greater equity interest;
        (c) any partnership or similar organization in which the specified Person
        or
        subsidiary of the specified Person is a general partner; or (d) any Person
        the
        management of which is directly or indirectly controlled by the specified
        Person
        and its Subsidiaries through the exercise of voting power, by contract or
        otherwise;

       

      “Surviving
        Corporation”
shall
        have the meaning set forth in Section 2.1 of this Agreement;

       

      “Tangible
        Personal Property”
means
        all equipment, tools, fixtures, furniture, office equipment, computer hardware,
        supplies, materials and other items of tangible personal property (other
        than
        Inventory) of every kind owned or leased by the Company (wherever located)
        and
        whether or not carried on its books) and related to the Business, together
        with
        any express or implied warranty by the manufacturers or sellers or lessors
        of
        any item or component part thereof and all maintenance records and documents
        related thereto;

       

      “Taxes”
means
        any U.S. or non U.S. federal, state, provincial, local or foreign (i) income,
        corporation gross income, gross receipts, license, payroll, employment, excise,
        severance, stamp, occupation, premium, windfall profits, environmental, customs
        duties, capital, franchise, profits, withholding, social security (or similar),
        unemployment, disability, real property, personal property, intangible property,
        recording, occupancy, sales, use, transfer, registration, value added minimum,
        ad valorem or excise tax, estimated or other tax of any kind whatsoever,
        including any interest, additions to tax, penalties, fees, deficiencies,
        assessments, additions or other charges of any nature with respect thereto,
        whether disputed or not; and (ii) any liability for the payment of any amount
        of
        the type described in (i) above; 

       

      “Tax
        Returns”
means
        all federal, state, local, provincial and foreign tax returns, declarations,
        reports, claims, schedules and forms for refund or credit or information
        return
        or statement relating to Taxes, including any schedule or attachment thereto,
        and including any amendment thereof;

       

      “Transactions”
shall
        have the meaning set forth in Section 3.2 of this Agreement;

       

      “URBCA”
shall
        have the meaning set forth in the Recitals of this Agreement

       

      “Welfare
        Plan”
means
        any “employee welfare benefit plan” as defined in Section
        3(1)
        of ERISA
        which the Company or any ERISA Affiliate maintains, administers, contributes
        to
        or is required to contribute to, or under which the Company or any ERISA
        Affiliate may incur any Liability.

       

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      ARTICLE
        2

      THE
        MERGER

       

      2.1 Merger.
        Upon
        the terms and conditions set forth in this Agreement, and in accordance with
        the
        provisions of the URBCA, at the Effective Time (as defined below), (i) the
        Company shall be merged with and into Merger Sub, (ii) the separate corporate
        existence of the Company shall cease, (iii) Merger Sub, as the surviving
        corporation in the Merger, shall continue its existence under the laws of
        the
        State of Utah, and (iv) Merger Sub shall succeed to and assume the rights,
        obligations, properties, rights, privileges, powers and franchises of the
        Company. Merger Sub, as the surviving corporation after the Merger, is sometimes
        referred to herein as the “Surviving
        Corporation.”

       

      2.2 Closing.
        Unless
        this Agreement has been terminated pursuant to the provisions of Article
        8
        hereof, and subject to the satisfaction or waiver of the conditions set forth
        in
        Article 7 of this Agreement, the closing of the Merger and other transactions
        contemplated hereby (the “Closing”)
        shall
        take place at the offices of Troy & Gould located at 1801 Century Park East,
        16th
        Floor,
        Los Angeles, California 90067, or at such other place as Parent and the Company
        mutually agree, at 10:00 a.m. local time on the later to occur of (a) March
        15,
        2008, or (b) the second Business Day after the day on which the last of the
        closing conditions set forth in Article 7 below has been satisfied or waived,
        or
        such other date as Parent and the Company mutually agree upon in writing
        (the
“Closing
        Date”).
        Notwithstanding anything herein to the contrary, the Closing Date shall be
        deemed to be 12:01 am on January 1, 2008, unless otherwise agreed to by the
        Parties, or unless this Agreement is otherwise terminated pursuant to Article
        9
        hereof.

       

      2.3 Effective
        Time.
        Subject
        to the provisions of this Agreement, at the Closing, the Parties shall cause
        the
        Merger to become effective by causing the Surviving Corporation to execute
        and
        file in accordance with the relevant provisions of the URBCA articles of
        merger
        with the State of Utah Division of Corporations and Commercial Code (the
        “Articles
        of Merger”),
        together with any required related certificates, and shall make any other
        filings or recordings required under the URBCA. The Merger shall become
        effective upon such filing, or at such later date and time as is agreed to
        by
        Parent and the Company and set forth in the Articles of Merger (the date
        and
        time of such filing being the “Effective
        Time”
and
        the
        date upon which the Effective Time occurs, being the “Effective
        Date”).
        As
        soon as practicable on the Closing Date, Parent will deliver the Merger Stock
        Consideration and Merger Cash Consideration to the Selling Stockholders in
        accordance with Section 2.5 hereof.

       

      2.4 Effect
        of the Merger.
        At the
        Effective Time, in accordance with the URBCA, the separate existence of the
        Company will cease and the Surviving Corporation shall succeed, without further
        action, to all the property, assets, rights, privileges, powers and franchises
        of every kind of the nature and description of the Company. All debts,
        liabilities and duties of Merger Sub and the Company will become the debts,
        liabilities and duties of the Surviving Corporation. As of the Effective
        Time,
        the Surviving Corporation will be a wholly owned subsidiary of the
        Parent.

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      2.5 Effect
        of Merger on Company Common Stock.
        

       

      (a) At
        the
        Effective Time (subject to Section 2.7 below), all shares of common stock,
        $0.01
        par value per share, of the Company (the “Company
        Common Stock”)
        issued
        and outstanding immediately prior to the Effective Time shall, by virtue
        of the
        Merger, automatically without any action on the part of the holder thereof
        be
        converted into the right to receive, upon surrender of the certificates
        representing each such share, if any, an allocable portion of the following
        (as
        set forth on Exhibit
        A
        attached
        hereto): (a) a cash payment of $1,000,000 (the “Merger
        Cash Consideration”),
        and
        (b); 571,428 shares of the common stock, $0.08 par value per share, of Parent
        (“Parent
        Common Stock”)(the
        “Merger
        Stock Consideration,”
and
        together with the Merger Cash Consideration, the “Merger
        Consideration”).
        

       

      (b) At
        the
        Effective Time, all shares of Company Common Stock shall automatically be
        cancelled and shall cease to exist, and each holder of a certificate which
        previously represented any such share of Company Common Stock (each, a
“Company
        Certificate”
and,
        collectively, the “Company
        Certificates”)
        shall
        cease to have any rights with respect thereto other than the right to receive
        the Merger Consideration such holder is entitled to receive pursuant to Section
        2.5(a) hereof, to be issued or paid in consideration therefor upon surrender
        of
        such certificate in accordance with Section 2.7 hereof. 

       

      (c) At
        the
        Effective Time, all shares of Company Common Stock held by the Company as
        treasury stock, if any, or owned by any direct or indirect Subsidiary of
        the
        Company, if any, immediately prior to the Effective Time shall automatically
        be
        cancelled and shall cease to exist, and the Company and any such Subsidiary
        shall cease to have any rights with respect thereto.

       

      (d) The
        Merger Consideration shall be allocated to and distributed between the Selling
        Stockholders as set forth on Exhibit
        A
        attached
        hereto. For the avoidance of doubt, and notwithstanding anything herein to
        the
        contrary, the securities issuable to the Selling Stockholders under this
        Agreement, including, without limitation, the Merger Stock Consideration,
        shall
        be unregistered shares of the Parent Common Stock issued in reliance upon
        the
        exemption from securities registration afforded by Section 4(2) of the
        Securities Act and bearing a restrictive legend.

       

      2.6 Effect
        of Merger on Common Stock of Merger Sub.
        At the
        Effective Time, each share of common stock of Merger Sub issued and outstanding
        immediately prior to the Effective Time shall, by virtue of the Merger and
        without any action on the part of the holders thereof, be converted into
        and
        become one share of validly issued, fully paid and non-assessable shares
        of
        common stock, par value $.01 per share, of the Surviving
        Corporation.

       

      2.7 Delivery
        of Certificates.
        At and
        after the Effective Time, Parent will make available, and the Selling
        Stockholders shall be entitled to receive, (i) upon surrender to Parent or
        its
        Representatives of the Company Certificates for cancellation and an assignment
        separate from certificate in the form attached hereto as Exhibit
        B
        (the
“Stock
        Power”),
        the
        allocable share of the Merger Consideration, and upon such surrender of the
        Company Certificates, and delivery by Parent of the aggregate Merger
        Consideration in exchange therefor, such shares shall forthwith be cancelled.
        Until surrendered or delivered as contemplated by this Section 2.7, each
        Company
        Certificate will be deemed at any time after the Effective Time for all purposes
        to evidence only the right to receive upon such surrender the Merger
        Consideration (as allocated pursuant to Exhibit
        A
        hereof).

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      2.8 Stock
        Transfer Books.
        From
        and after the Effective Time, the stock transfer books of the Company will
        be
        closed, and there will be no further registration or transfers of Company
        Common
        Stock thereafter on the records of the Company. 

       

      2.9 No
        Fractional Shares.
        No
        certificate or scrip representing fractional shares of Parent Common Stock
        shall
        be issued upon the surrender of Company Certificates for exchange, and such
        fractional share interests will not entitle the owner thereof to vote or
        to any
        other rights of a stockholder of Parent. Each holder of shares of Company
        Common
        Stock exchanged pursuant to the Merger who would otherwise be entitled to
        receive a fraction of a share of Parent Common Stock (after taking into account
        all Company Certificates delivered by such holder) shall receive from Parent,
        in
        lieu thereof, cash (without interest) in an amount, less any applicable
        withholding taxes, equal to such fractional part of a share of Parent Common
        Stock multiplied by $5.25, the per share value of Parent Common Stock used
        for
        purposes of the Merger and this Agreement.

       

      2.10 Lost,
        Stolen or Destroyed Certificates.
        In the
        event any Company Certificates are lost, stolen or destroyed, Parent will
        issue
        in exchange for such lost, stolen or destroyed Company Certificates, upon
        the
        making of an affidavit of that fact by the holder thereof and the other
        deliveries required above, the applicable Merger Consideration; provided,
        however,
        that
        the Surviving Corporation may, in its sole discretion and as a condition
        precedent to the issuance thereof, require the owner of such lost, stolen
        or
        destroyed Company Certificate to deliver an indemnity or bond in such sum
        as it
        may reasonably direct as indemnity against any claim that may be made against
        it
        with respect to the Company Certificates alleged to have been lost, stolen
        or
        destroyed.

       

      2.11 Taking
        of Necessary Action; Further Action.
        Each of
        Parent, Merger Sub and the Company will take all such reasonable lawful action
        as may be necessary or appropriate in order to effect the Merger in accordance
        with this Agreement as promptly as practicable. If, at any time after the
        Effective Time, any such further action is necessary or desirable to carry
        out
        the purposes of this Agreement and to vest the Surviving Corporation with
        full
        right, title and possession to all the property, rights, privileges, power
        and
        franchises of the Company and Merger Sub, the officers and directors of the
        Company and Merger Sub immediately prior to the Effective Time are fully
        authorized in the name of their respective corporations or otherwise to take,
        and will take, all such lawful and necessary action

       

      2.12 Reorganization
        Treatment.
        For
        federal income tax purposes, the Merger is intended to constitute a
        reorganization within the meaning of Section 368 of the Code. For the avoidance
        of doubt, and not withstanding anything herein to the contrary, no Party
        represents, warrants or guarantees that the Merger and the transactions
        contemplated by this Agreement will be treated by any relevant Regulatory
        Authority as a reorganization within the meaning of Section 368 of the
        Code.

       

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      ARTICLE
        3

      REPRESENTATIONS
        AND WARRANTIES OF THE

      COMPANY
        AND SELLING STOCKHOLDERS

       

      Except
        as
        set forth on the disclosure schedules to this Agreement (the “Disclosure
        Schedules”),
        the
        Company, and each of the Selling Stockholders, jointly and severally, represent
        and warrant to Parent that the statements contained in this Article 3 are
        true,
        complete and correct as of the date of this Agreement and will be correct
        and
        complete as of the Closing Date (as though made then and as though the Closing
        Date were substituted for the date of this Agreement throughout this Article
        3,
        except in the case of representations and warranties stated to be made as
        of the
        date of this Agreement or as of another date and except for changes contemplated
        or permitted by this Agreement); provided,
        however,
        that
        with respect to Sections 3.4, 3.5, 3.6, 3.8, 3.10(a), 3.10(b), 3.10(c), 3.10(d),
        3.10(e), 3.10 (f), 3.10(g), 3.11(e), 3.11(f), 3.11(g), 3.12, 3.13, 3.15,
        3.16,
        3.17, 3.18, 3.19, 3.20, 3.21, 3.22, 3.23, 3.24 and 3.25 of this Article 3,
        the
        Selling Stockholders make the representations and warranties thereunder only
        as
        to their Knowledge.

       

      3.1 Organization
        and Qualification; Subsidiaries.
        

       

      (a) Each
        of
        the Company and its Subsidiaries is duly organized, validly existing and
        in good
        standing under the Laws of the jurisdiction in which it is organized and
        has the
        requisite power and authority to carry on its business as now being conducted,
        which such jurisdictions are set forth on Schedule
        3.1(a)
        hereto
        of Disclosure Schedules. The Company has properly elected to be treated,
        and has
        qualified for treatment, as an S corporation, within the meaning of Section
        1361
        of the Code, from its inception and will continue to so qualify and be treated
        through the date of the Merger.

       

      (b) Each
        of
        the Company and its Subsidiaries is duly qualified or licensed to do business
        and is in good standing in each jurisdiction in which the nature of its business
        or the ownership or leasing of its properties makes such qualification or
        licensing necessary, other than in such jurisdictions where the failure to
        be so
        qualified or licensed (individually or in the aggregate) has not had and
        would
        not reasonably be expected to have a Material Adverse Effect.

       

      (c) The
        Company has delivered to Parent complete and correct copies of its articles
        of
        incorporation and bylaws and the articles or certificates of incorporation
        and
        bylaws (or comparable charter documents) of its Subsidiaries, in each case
        as
        amended to the date hereof. All of the outstanding shares of capital stock
        or
        other ownership interests of each Subsidiary of the Company have been validly
        issued and are fully paid and nonassessable and owned by the Company, free
        and
        clear of all Liens, and free of any restriction on the right to vote, sell
        or
        otherwise dispose of such capital stock or other ownership interests, except
        for
        restrictions imposed by applicable securities Laws. 

       

      (d) There
        are
        no outstanding (i) securities of the Company or any of its Subsidiaries
        convertible into or exchangeable for shares of capital stock or other ownership
        interests in any Subsidiary of the Company or (ii) options or other rights
        to
        acquire from the Company or any of its Subsidiaries, or other obligation
        of the
        Company or any of its Subsidiaries to issue, any capital stock or other
        ownership interests in, or any securities convertible into or exchangeable
        for
        any capital stock or other ownership interests in, any Subsidiary of the
        Company. 

       

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      (e) Except
        for ownership of less than 1% in any publicly traded company and the capital
        stock or other ownership interests of its Subsidiaries, the Company does
        not
        own, directly or indirectly, any capital stock or other ownership interest
        in
        any corporation, partnership, joint venture or other entity. No Subsidiary
        of
        the Company owns any shares of Company Common Stock.

       

      (f) Schedule
        3.1
        of the
        Disclosure Schedules sets forth each Subsidiary of the Company. As used in
        this
        Agreement, the term “Subsidiary”,
        with
        respect to any Person, means any corporation or other legal entity of which
        such
        Person Controls (either alone or through or together with any other Subsidiary),
        directly or indirectly, more than 50% of the capital stock or other ownership
        interests the holders of which are generally entitled to vote for the election
        of the Board of Directors or other governing body of such corporation or
        other
        legal entity.

       

      3.2 Authorization;
        Enforceability.
        The
        Company has the requisite power and authority, and has taken all action
        necessary, to execute, deliver and perform its obligations under this Agreement
        and any Ancillary Agreement to which it is a party and each other agreement,
        document, instrument or certificate contemplated by this Agreement and/or
        any
        Ancillary Agreement or to be executed by the Company in connection with the
        consummation of the transactions contemplated by this Agreement (the
“Transactions”),
        and,
        subject to approval of the stockholders of the Company, to consummate the
        Transactions. The execution and delivery by the Company of this Agreement
        and
        any applicable Ancillary Agreement, and the consummation by the Company of
        the
        Transactions contemplated hereby, and the performance by the Company of its
        obligations hereunder, have been duly and validly authorized by all necessary
        corporate action on the part of the Company, subject to adoption of this
        Agreement by the Company’s stockholders, and no other action on the part of the
        Company is required to authorize the execution, delivery and performance
        of this
        Agreement and the consummation by the Company of the transactions contemplated
        hereby. This Agreement has been duly and validly executed and delivered by
        the
        Company and constitutes a legal, valid and binding obligation of the Company
        enforceable against the Company in accordance with its terms, except as such
        enforceability may be limited by bankruptcy, insolvency, moratorium,
        reorganization and other similar laws affecting creditors’ rights generally and
        the general principles of equity, regardless of whether asserted in a proceeding
        in equity or at law.

       

      3.3 Capitalization.

       

      (a) The
        authorized capital stock of the Company as of the date of this Agreement
        consists of 100,000 shares of Company Common Stock, $0.01 par value per share,
        and no shares of preferred stock of the Company. As of the date of this
        Agreement, (i) there are 4,890 shares of Company Common Stock issued and
        outstanding; (ii) no shares of Company Common Stock are held in the treasury
        of
        the Company; (iii) no shares of Company Common Stock have been reserved for
        future issuance pursuant to the exercise of outstanding options or warrants.
        Except as described above, as of the close of business on the day prior to
        the
        date hereof, there were no shares of voting or non-voting capital stock,
        equity
        interests or other securities of the Company authorized, issued, reserved
        for
        issuance or otherwise outstanding.

       

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      (b) All
        outstanding shares of Company Common Stock are duly authorized, validly issued,
        fully paid and non-assessable, and not subject to, or issued in violation
        of,
        any preemptive, subscription or any kind of similar rights. The Company has
        no
        outstanding shares of Company Common Stock that are subject to a right of
        repurchase that will survive the Merger.

       

      (c) There
        are
        no bonds, debentures, notes or other indebtedness of the Company having the
        right to vote (or convertible into securities having the right to vote) on
        any
        matters on which stockholders of the Company may vote. Except as set forth
        on
Schedule
        3.3(c)
        of the
        Disclosure Schedules, there are no outstanding securities, options, warrants,
        calls, rights, commitments, agreements, arrangements or undertakings of any
        kind
        (contingent or otherwise) to which the Company is a party or bound obligating
        the Company to issue, deliver or sell, or cause to be issued, delivered or
        sold,
        additional shares of capital stock or other voting securities of the Company
        or
        obligating the Company to issue, grant, extend or enter into any agreement
        to
        issue, grant or extend any security, option, warrant, call, right, commitment,
        agreement, arrangement or undertaking. Neither the Company nor any of its
        Subsidiaries is subject to any obligation or requirement to provide funds
        for or
        to make any investment (in the form of a loan or capital contribution) in
        any
        Person.

       

      (d) All
        of
        the issued and outstanding shares of Company Common Stock were issued in
        compliance in all material respects with all applicable federal and state
        securities Laws.

       

      (e) Except
        as
        set forth on Schedule
        3.3(e)
        of the
        Disclosure Schedules, there are no outstanding contractual obligations of
        the
        Company to repurchase, redeem or otherwise acquire any shares of capital
        stock
        (or options or warrants to acquire any such shares) or other security or
        equity
        interests of the Company. Except as set forth on Schedule
        3.3(e)
        of the
        Disclosure Schedules, there are no stock-appreciation rights, security-based
        performance units, phantom stock or other security rights or other agreements,
        arrangements or commitments of any character (contingent or otherwise) pursuant
        to which any Person is or may be entitled to receive any payment or other
        value
        based on the revenues, earnings or financial performance, stock price
        performance or other attribute of the Company or any of its Subsidiaries
        or
        assets or calculated in accordance therewith of the Company or to cause the
        Company or any of its Subsidiaries to file a registration statement under
        the
        Securities Act, or which otherwise relate to the registration of any securities
        of the Company or any of its Subsidiaries.

       

      (f) Except
        as
        set forth on Schedule
        3.3(f)
        of the
        Disclosure Schedules, there are no voting trusts, proxies or other agreements,
        commitments or understandings to which the Company or any of its Subsidiaries
        or, to the knowledge of the Company, any of the stockholders of the Company,
        is
        a party or by which any of them is bound with respect to the issuance, holding,
        acquisition, voting or disposition of any shares of capital stock or other
        security or equity interest of the Company or any of its
        Subsidiaries.

       

      3.4 Non-contravention.
        Except
        as set forth on Schedule
        3.4
        of the
        Disclosure Schedules, the execution, delivery and performance of this Agreement
        by the Company does not and, subject to obtaining stockholder adoption of
        this
        Agreement, the consummation of the Transactions will not (a) contravene,
        conflict with, or result in any violation or breach of any provision of the
        articles of incorporation or by-laws of the Company, (b) contravene, conflict
        with, or result in a violation or breach of any provision of any Law applicable
        to the Business and operations of the Company, (c) require any consent or
        other
        action by any Person under, constitute a breach of or default under, or cause
        or
        permit the termination, cancellation, acceleration or other change of any
        right
        or obligation or the loss of any benefit to which the Company or any of its
        Subsidiaries is entitled under any provision of any agreement or other
        instrument binding upon the Company or any of its Subsidiaries or any license,
        franchise, permit, certificate, approval or other similar authorization
        affecting, or relating in any way to, the assets or business of the Company
        and
        its Subsidiaries or (d) result in the creation or imposition of any Lien
        on any
        asset of the Company or any of its Subsidiaries, which in the case of clauses
        (b) or (d) above would have a Material Adverse Effect on the Company or on
        the
        validity, binding effect or enforceability of this Agreement, any Ancillary
        Agreement, or the ability of the Company to perform its obligations under
        this
        Agreement or any applicable Ancillary Agreement.

       

      
        
           

        

        
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      3.5 Consents
        and Approvals.
        Except
        as set forth on Schedule
        3.5
        of the
        Disclosure Schedules, no consent, approval, authorization or order of,
        registration or filing with, or notice to, any Regulatory Authority or any
        other
        Person is necessary to be obtained, made or given by the Company in connection
        with the execution, delivery and performance by the Company of this Agreement
        or
        any applicable Ancillary Agreement or for the consummation by the Company
        of the
        Transactions, except to the extent the failure to obtain any such consent,
        approval, authorization or order or to make any such registration or filing
        would not have a Material Adverse Effect on the Company or on the validity,
        binding effect or enforceability of this Agreement or any Ancillary Agreement
        to
        which the Company is a party, or the ability of the Company to perform its
        obligations under this Agreement or any Ancillary Agreement.

       

      3.6 Books
        and Records.
        The
        Company has made and kept books and records and accounts, which, in reasonable
        detail, accurately and fairly reflect the activities of the Company pertaining
        to the Business. The Company has not, in any manner that pertains to, or
        could
        affect, the Business, engaged in any transaction, maintained any bank account
        or
        used any corporate funds except for transactions, bank accounts and funds
        which
        have been and are reflected in the normally maintained Books and Records
        of the
        Company.

       

      3.7 Financial
        Statements.
        Attached hereto as Exhibit
        C
        are the
        Company Financial Statements. The Company Financial Statements have been
        prepared from the books and records and fairly and accurately present the
        financial condition and the results of operations, income, expenses, assets,
        Liabilities (including all reserves), changes in shareholders’ equity and cash
        flow of the Company as of the respective dates of, and for the periods referred
        to in, such Company Financial Statements, in accordance with GAAP applied
        on a
        consistent basis throughout the periods indicated. Except as otherwise set
        forth
        on Schedule
        3.7
        of the
        Disclosure Schedules, the Company maintains a standard system of accounting
        established and administered in accordance with GAAP.

       

      3.8 No
        Undisclosed Liabilities.
        Except
        as set forth on Schedule
        3.8
        of the
        Disclosure Schedules, the Company has no Liabilities relating to the Business
        due or to become due except (a) Liabilities relating to the Business that
        are
        reflected in the Company Financial Statements which have not been paid or
        discharged since the Company Financial Statement Date, and (b) Liabilities
        relating to the Business incurred in the Ordinary Course of Business since
        the
        Company Financial Statement Date (none of which relates to any default under
        any
        Contract or Lease, breach of warranty, tort, infringement or violation of
        any
        Law or Order or arose out of any Legal Proceeding) and none of which would
        have
        a Material Adverse Effect.

       

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

      3.9 Taxes.
        

       

      (a) Filing
        of Tax Returns.
        Except
        as set forth on Schedule
        3.9(a)
        of the
        Disclosure Schedules, the Company has duly and timely filed (or caused to
        be
        filed) with the appropriate taxing authorities all Tax Returns required to
        be
        filed through the Closing Date. All such Tax Returns filed are complete and
        accurate in all respects. Except as set forth on Schedule
        3.9(a)
        of the
        Disclosure Schedules, the Company is not currently the beneficiary of any
        extension of time within which to file any Tax Return. No claim has ever
        been
        made against the Company or its assets by an authority in a jurisdiction
        where
        the Company does not file Tax Returns such that the Company is or may be
        subject
        to taxation by that jurisdiction.

       

      (b) Payment
        of Taxes.
        Except
        as set forth on Schedule
        3.9(b)
        of the
        Disclosure Schedules, all Taxes owed and due by the Company (whether or not
        shown on any Tax Return) have been paid. The unpaid Taxes of the Company,
        if
        any, (i) did not, as of the date of its Interim Balance Sheet, exceed the
        reserve for Tax liability (excluding any reserve for deferred Taxes established
        to reflect timing differences between book and Tax income) set forth on the
        face
        of its Interim Balance Sheet (rather than in any notes thereto), and (ii)
        have
        not exceeded that reserve as adjusted for operations and transactions through
        the Closing Date in accordance with the past custom and practice of the Company
        in filing its Tax Returns. Since the Interim Balance Sheet Date, the Company
        has
        not (i) incurred any Liability for Taxes other than in the Ordinary Course
        of
        Business or (ii) paid Taxes other than Taxes paid on a timely basis and in
        a
        manner consistent with past custom and practice.

       

      (c) Audits,
        Investigations, Disputes or Claims.
        Except
        as set forth on Schedule
        3.9(c)
        of the
        Disclosure Schedules, no deficiencies for Taxes are claimed, proposed or
        assessed by any taxing or other governmental authority against the Company,
        and
        there are no pending or, to the Knowledge of the Company, threatened audits,
        investigations, disputes or claims or other actions for or relating to any
        Liability for Taxes with respect to the Company, and there are no matters
        under
        discussion by or on behalf of the Company with any Regulatory Authority,
        or
        known to the Company, with respect to Taxes that are likely to result in
        an
        additional Liability for Taxes with respect to the Company. Audits of federal,
        state and local Tax Returns by the relevant taxing authorities have been
        completed for the periods set forth on Schedule
        3.9(c)
        of the
        Disclosure Schedules, and, except as set forth thereon, none of the Company,
        any
        Subsidiary thereof, or any predecessor thereof has been notified that any
        taxing
        authority intends to audit a Tax Return for any other period. The Company
        has
        delivered to Parent complete and accurate copies of the Company’s federal, state
        and local Tax Returns for the years ended December 31, 2006 and 2007 as well
        as
        complete and accurate copies of all examination reports and statements of
        deficiencies assessed against or agreed to by the Company at any time. The
        Company has not waived any statute of limitations in respect of Taxes or
        agreed
        to any extension of time with respect to a Tax assessment or deficiency.
        No
        power of attorney granted by the Company with respect to any Taxes is currently
        in force.

       

      (d) Lien.
        There
        are no Liens for Taxes (other than for current Taxes not yet due and payable)
        on
        any assets or capital stock of the Company.

       

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

      (e) Tax
        Elections.
        All
        material elections with respect to Taxes affecting the Company or any of
        its
        respective assets as of the Closing Date are set forth on Schedule
        3.9(e)
        of the
        Disclosure Schedules. The Company has not: (i) consented at any time under
        Section 341(f)(1) of the Code to have the provisions of Section 341(f)(2)
        of the
        Code apply to any disposition of any of its assets; (ii) agreed, and is not
        required, to make any adjustment under Section 481(a) of the Code by reason
        of a
        change in accounting method or otherwise; (iii) made an election, and is
        not
        required, to treat any of its assets as owned by another Person pursuant
        to the
        provisions of Section 168(f) of the Code or as tax-exempt bond financed property
        or tax-exempt use property within the meaning of Section 168 of the Code;
        (iv)
        acquired, and does not own, any assets that directly or indirectly secure
        any
        debt the interest on which is tax exempt under Section 103(a) of the Code;
        (v)
        made a consent dividend election under Section 565 of the Code; or (vi) made
        any
        of the foregoing elections and is not required to apply any of the foregoing
        rules under any comparable state or local Tax provision.

       

      (f) Prior
        Affiliated Groups.
        The
        Company is not and has never been a member of an affiliated group of
        corporations within the meaning of Section 1504 of the Code. The Company
        does
        not have any Liability for the Taxes of any Person (i) under Treasury
        Regulations Section 1.1502-6 (or any similar provision of state, local or
        foreign law), (ii) as a transferee or successor, (iii) by Contract, or (iv)
        otherwise. 

       

      (g) Tax
        Sharing Agreements.
        There
        are no agreements for the sharing of Tax liabilities or similar arrangements
        (including indemnity arrangements) with respect to or involving the Company
        (or
        any of its Subsidiaries) or any of its assets or the Business, and, after
        the
        Closing Date, neither the Company nor any of its assets or the Business shall
        be
        bound by any such Tax-sharing agreements or similar arrangements or have
        any
        Liability thereunder for amounts due in respect of periods prior to the Closing
        Date.

       

      (h) Partnerships
        and Single Member LLCs.
        Except
        as set forth on Schedule
        3.9(h)
        of the
        Disclosure Schedules, the Company (i) is not subject to any joint venture,
        partnership, or other arrangement or contract which is treated as a partnership
        for Tax purposes, (ii) does not own a single member limited liability company
        which is treated as a disregarded entity, (iii) is not a shareholder of a
        “controlled foreign corporation” as defined in Section 957 of the Code (or any
        similar provision of state, local or foreign law) and (iv) is not a “personal
        holding company” as defined in Section 542 of the Code (or any similar provision
        of state, local or foreign law). 

       

      (i) No
        Withholding.
        The
        Company has not been a United States real property holding corporation within
        the meaning of Section 897(c)(2) of the Code during the applicable period
        specified in Section 897 of the Code. The Company has withheld and paid all
        Taxes required to have been withheld and paid in connection with amounts
        paid or
        owing to any employee, independent contractor, creditor, shareholder or other
        third party. The transactions contemplated herein are not subject to the
        tax
        withholding provisions of Section 3406 of the Code, or of Subchapter A of
        Chapter 3 of the Code or of any other provision of law.

       

      (j) International
        Boycott.
        The
        Company has not participated in and is not participating in an international
        boycott within the meaning of Section 999 of the Code.

       

      
        
           

        

        
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      (k) Permanent
        Establishment.
        Except
        as set forth on Schedule
        3.9(k)
        of the
        Disclosure Schedules, the Company does not have and has never had a permanent
        establishment in any foreign country, as defined in any applicable Tax treaty
        or
        convention between the United States and such foreign country.

       

      (l) Parachute
        Payments.
        Except
        as set forth on Schedule
        3.9(l)
        of the
        Disclosure Schedules, the Company is not a party to any existing Contract,
        arrangement or plan that has resulted or would result (upon the Closing or
        otherwise), separately or in the aggregate, in the payment of any “excess
        parachute payments” within the meaning of Section 280(G) of the
        Code.

       

      (m) Tax
        Shelters.
        Neither
        the Company nor any Subsidiary has participated in and the Company is not
        now
        participating in, any transaction described in Section 6111(c) or (d) of
        the
        Code or Section 6112(b) of the Code or the Treasury Regulations thereunder,
        or
        in any reportable transaction described in such regulations.

       

      3.10 Intellectual
        Property; Software.
        

       

      (a) Schedule
        3.10(a)
        of the
        Disclosure Schedules sets forth a true, correct and complete list of all
        Intellectual Property owned by the Company (the “Owned
        Proprietary Rights”).
        Schedule
        3.10(a)
        of the
        Disclosure Schedules also lists each material license for Intellectual Property
        licensed by the Company (the “Licensed
        Proprietary Rights”).

       

      (b) (i)
        The
        operation of the Business, including the use of the Owned Proprietary Rights,
        does not infringe or misappropriate or otherwise materially violate the
        Intellectual Property rights of any third party, and no claim is pending
        or, to
        the knowledge of the Company, threatened against the Company alleging any
        of the
        foregoing, (ii) the Company owns, or with respect to the Licensed Proprietary
        Rights, licenses all of the Intellectual Property necessary for the conduct
        of
        the Business, and (iii) except for the Owned Proprietary Rights and the Licensed
        Proprietary Rights, no material right, license, lease, consent, or other
        agreement is required with respect to any Intellectual Property for the conduct
        of the Business.

       

      (c) Except
        as
        set forth on Schedule
        3.10(c)
        of the
        Disclosure Schedules, or licenses that are immaterial to the Ordinary Course
        of
        Business of the Company, the Company is (i) the sole owner of the entire
        and
        unencumbered right, title and interest in and to each item of the Owned
        Proprietary Rights, and (ii) entitled to use the Owned Proprietary Rights
        and
        Licensed Proprietary Rights in the ordinary course of its business to the
        extent
        such rights are used in the operation of the Business. The Company has legally
        secured all Licensed Proprietary Rights (including, without limitation, any
        promotion, production, exhibition and similar rights currently exploited
        by the
        Company, and any Licensed Proprietary Rights embodied in the Contracts listed
        on
Schedule
        3.11
        of the
        Disclosure Schedules), and to the Company’s Knowledge, the respective licensors
        of such Licensed Proprietary Rights (including, without limitation, any
        promotion, production, exhibition and similar rights currently exploited
        by the
        Company) have valid title to all such rights.

       

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

      (d) The
        Owned
        Proprietary Rights and Licensed Proprietary Rights include all of the material
        Intellectual Property used in the Business, and there are no other items
        of
        Intellectual Property that are material to the Business.

       

      (e) The
        Company has made available to Parent all material correspondence and all
        written
        opinions in its possession relating to potential infringement or
        misappropriation (i) by the Company of any Intellectual Property rights of
        any
        third party or (ii) by any third party of any of the Owned Proprietary Rights
        or
        Licensed Proprietary Rights.

       

      (f) To
        the
        Knowledge of the Company, (i) no third party is engaging in any activity
        that
        infringes or misappropriates the Owned Proprietary Rights or Licensed
        Proprietary Rights and (ii) the Company has not granted any material license
        or
        other right to any third party with respect to the Owned Proprietary Rights
        or
        Licensed Proprietary Rights.

       

      (g) The
        Company has a license to use all software development tools, library functions,
        compilers and other third-party software that are used in the operation of
        the
        Business and are material to the Business, taken as a whole.

       

      3.11 Contracts;
        No Defaults.

       

      (a) Schedule
        3.11(a)
        of the
        Disclosure Schedules sets forth a complete and accurate list, and the Company
        has made available to Parent true and complete copies, of all executory
        Contracts of the Company in the following categories:

       

      (i) Contracts
        that involve performance of services or delivery of goods by the Company
        during
        any twelve (12) month period of an amount or value, individually or, for
        a
        series of related Contracts, in the aggregate, in excess of Five Thousand
        Dollars ($5,000);

       

      (ii) Contracts
        that were not entered into in the Ordinary Course of Business;

       

      (iii) Leases
        (including Leases of Tangible Personal Property) of the Company and other
        Contracts, in each case, affecting the ownership of, leasing of, title to,
        use
        of, or any leasehold or other interest in, any real or personal property
        (except
        personal property leases and installment and conditional sales agreements
        having
        a value per item or aggregate payments, in each case, of less than Five Thousand
        Dollars ($5,000) and with terms of less than one year);

       

      (iv) Licensing
        agreements of the Company, if any, and other Contracts, in each case, with
        respect to patents, trademarks, copyrights or other Intellectual Property
        as
        well as the forms of all agreements with current or former employees,
        consultants or contractors regarding the appropriation of, or the non-disclosure
        of, any of the Intellectual Property set forth on Schedule
        3.10(a)
        of the
        Disclosure Schedules;

       

      (v) collective
        bargaining agreements of the Company and other Contracts, in each case, to
        or
        with any labor union or other employee representative of a group of employees
        and each other written employment or consulting agreement with any employees
        or
        consultants;

       

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

      (vi) joint
        ventures or partnerships (however named) of the Company and other Contracts,
        in
        each case, involving a sharing of profits, losses, costs or liabilities by
        the
        Company with any other Person;

       

      (vii) Contracts
        containing covenants that in any way purport to restrict the business activity
        of the Company or limit the freedom of the Company to engage in any line
        of
        business or to compete with any Person or that subjects the Company to
        confidentiality or non-disclosure obligations;

       

      (viii) Contracts
        providing for payments to or by any Person based on sales, purchases or profits,
        other than direct payments for goods;

       

      (ix) powers
        of
        attorney granted by or to the Company that are currently effective and
        outstanding;

       

      (x) Contracts
        entered into other than in the Ordinary Course of Business that contain or
        provide for an express undertaking by the Company to be responsible for
        consequential damages;

       

      (xi) Contracts
        for capital expenditures relating to the Business in excess of Five Thousand
        Dollars ($5,000) individually or Ten Thousand Dollars ($10,000) in the
        aggregate;

       

      (xii) Contracts
        which, to the Knowledge of the Company, will result in a material loss to
        the
        Company;

       

      (xiii) Contracts
        between the Company and any of its former or current stockholders or
        shareholders, directors, officers and employees (other than standard employment
        agreements previously furnished to or approved by Parent and other than option
        and warrant agreements with the Company’s officers, directors and
        employees);

       

      (xiv) written
        warranties, guaranties, and/or other similar undertakings with respect to
        contractual performance extended by the Company, other than in the Ordinary
        Course of Business; and

       

      (xv) each
        amendment, supplement, and modification (whether oral or written) in respect
        of
        any of the foregoing.

       

      (b) To
        the
        Knowledge of the Company, no officer, director, agent, employee, consultant
        or
        contractor of the Company is bound by any Contract that purports to limit
        the
        ability of such officer, director, agent, employee, consultant or contractor
        to
        (i) engage in or continue any conduct, activity or practice relating to the
        Business or (ii) assign to the Company or to any other Person any rights
        to any
        invention, improvement or discovery.

       

      
        
           

        

        
          20

          
            

          

        

        
           

        

      

      (c) To
        the
        Knowledge of the Company, each Contract set forth on Schedule
        3.11(a)
        of the
        Disclosure Schedules is in full force and effect and is valid and enforceable
        in
        accordance with its terms, except as such enforceability may be limited by
        bankruptcy, insolvency, moratorium, reorganization or other similar laws
        affecting creditors’ rights generally and the general principles of equity,
        regardless of whether asserted in a proceeding in equity or at law.

       

      (d) To
        the
        Knowledge of the Company:

       

      (i) the
        Company is, and at all times has been, in compliance with all material terms
        and
        requirements of each Contract set forth on Schedule
        3.11(a)
        of the
        Disclosure Schedules under which the Company has or had any obligation or
        Liability or by which the Company or any of the assets owned or used by the
        Company is or was bound;

       

      (ii) each
        other Person that has or had any obligation or Liability under any Contract
        set
        forth on Schedule
        3.11(a)
        of the
        Disclosure Schedules under which the Company has or had any rights is, and
        has
        been, in compliance with all material terms and requirements of such
        Contract;

       

      (iii) 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 Person 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 Contract set forth on Schedule
        3.11(a)
        of the
        Disclosure Schedules; and

       

      (iv) the
        Company has not given to or received from any other Person, any written or,
        to
        the Knowledge of the Company, other notice or other communication regarding
        any
        actual, alleged, possible or potential violation or breach of, or default
        under,
        any Contract set forth on Schedule
        3.11(a)
        of the
        Disclosure Schedules.

       

      (e) There
        are
        no renegotiations of, attempts to renegotiate, or outstanding rights to
        renegotiate any material amounts paid or payable to the Company under current
        or
        completed Contracts, as applicable, with any Person and no such Person has
        made
        written demand for such renegotiation.

       

      (f) Contracts
        relating to the provision of products or services by the Company have been
        entered into in the Ordinary Course of Business and have been entered into
        without the commission of any act alone or in concert with any other Person,
        or
        any consideration having been paid or promised, that is or would be in violation
        of any Laws.

       

      (g) The
        Company has no reason to believe that the products and services called for
        by
        any unfinished Contract cannot be supplied in accordance with the terms of
        such
        Contract, including time specifications, and has no reason to believe that
        any
        unfinished Contract will upon performance by the Company result in a loss
        to the
        Company.

       

      (h) All
        of
        the Contracts set forth on Schedule
        3.11(a)
        of the
        Disclosure Schedules are assignable to the Surviving Corporation without
        the
        consent of any other Person, except as specifically noted on Schedule
        3.5
        of the
        Disclosure Schedules.

       

      
        
           

        

        
          21

          
            

          

        

        
           

        

      

      3.12 Employee
        Benefits.
        

       

      (a) Schedule
        3.12(a)
        of the
        Disclosure Schedules sets forth a complete list of all Employee Plans (i)
        covering employees, directors or consultants or former employees, directors
        or
        consultants in, or related to, the Business and/or (ii) with respect to which
        Surviving Corporation may incur any Liability. The Company has delivered
        or made
        available to Parent true and complete copies of all Employee Plans, including
        written interpretations thereof and written descriptions thereof which have
        been
        distributed to the Company’s employees and for which the Company has copies, all
        annuity contracts or other funding instruments relating thereto, and a complete
        description of all Employee Plans which are not in writing. 

       

      (b) Neither
        the Company nor any ERISA Affiliate sponsors, maintains, contributes to or
        has
        an obligation to contribute to, or has sponsored, maintained, contributed
        to or
        had an obligation to contribute to, any Pension Plan subject to Title IV
        of
        ERISA, or any Multiemployer Plan.

       

      (c) Each
        Welfare Plan which covers or has covered employees or former employees of
        the
        Company or of its Affiliates in the Business and which is a “group health plan,”
as defined in Section 607(1) of ERISA, has been operated in compliance with
        provisions of Part 6 of Title I, Subtitle B of ERISA and Section 4980B of
        the
        Code at all times. 

       

      (d) There
        is
        no Legal Proceeding or Order outstanding, relating to or seeking benefits
        under
        any Employee Plan set forth on Schedule
        3.12(a)
        of the
        Disclosure Schedules, which is pending, threatened or anticipated against
        the
        Company, any ERISA Affiliate or any Employee Plan. 

       

      (e) Neither
        the Company nor any ERISA Affiliate has any liability for unpaid contributions
        under Section 515 of ERISA with respect to any Welfare Plan (i) covering
        employees, directors or consultants or former employees, directors or
        consultants in, or related to, the Business and (ii) with respect to which
        Surviving Corporation may incur any Liability. 

       

      (f) There
        are
        no Liens arising under the Code or ERISA with respect to the operation,
        termination, restoration or funding of any Employee Plan set forth on
Schedule
        3.12(a)
        of the
        Disclosure Schedules, or arising in connection with any excise tax or penalty
        tax with respect to such Employee Plan. 

       

      (g) Each
        Employee Plan set forth on Schedule
        3.12(a)
        of the
        Disclosure Schedules has at all times been maintained in all material respects,
        by its terms and in operation, in accordance with all applicable laws,
        including, without limitation, ERISA and the Code. 

       

      (h) The
        Company and its ERISA Affiliates have made full and timely payment of all
        amounts required to be contributed under the terms of each Employee Plan
        and
        applicable Law or required to be paid as expenses or as Taxes under applicable
        Laws, under such Employee Plan, and the Company and its ERISA Affiliates
        shall
        continue to do so through the Closing Date. 

       

      (i) The
        Company has no Employee Plan intended to qualify under Section 401 of the
        Code.

       

      
        
           

        

        
          22

          
            

          

        

        
           

        

      

      (j) Neither
        the execution and delivery of this Agreement or other related agreements
        by the
        Company nor the consummation of the Transactions will result in the acceleration
        or creation of any rights of any person to benefits under any Employee Plan
        (including, without limitation, the acceleration of the vesting or
        exercisability of any stock options, the acceleration of the vesting of any
        restricted stock, the acceleration of the accrual or vesting of any benefits
        under any Pension Plan or the acceleration or creation of any rights under
        any
        severance, parachute or change in control agreement).

       

      (k) Neither
        the Company nor any ERISA Affiliate has incurred any liability with respect
        to
        any Employee Plan, which may create, or result in any liability to Surviving
        Corporation.

       

      3.13 Labor
        Matters; Employees.
        Except
        as set forth on Schedule
        3.13
        of the
        Disclosure Schedules, the Company is not a party to any collective bargaining
        or
        other labor Contract. There has not been, there is not presently pending
        or
        existing, and, to the Knowledge of the Company, there is not threatened (i)
        any
        strike, slowdown, picketing, work stoppage or employee grievance process
        against
        the Company or the Business; (ii) any Legal Proceeding against or affecting
        the
        Company or the Business relating to the alleged violation of any Law or Order
        pertaining to labor relations or employment matters; or (iii) union organizing
        campaign or any application for certification of a collective bargaining
        agent.
        No event has occurred or circumstance exists that could provide the basis
        for
        any work stoppage or other labor dispute. There is no lockout of any employees
        by the Company, and no such action is contemplated by the Company. The Company
        has complied with all material Laws relating to employment, equal employment
        opportunity, nondiscrimination, harassment, retaliation, immigration, wages,
        hours, benefits, collective bargaining, the payment of social security and
        similar Taxes, occupational health and safety, and plant closing. The Company
        is
        not liable for the payment of any compensation, damages, Taxes, fines, penalties
        or other amounts (including, without limitation, amounts related to workplace
        safety and insurance), however designated, for failure to comply with any
        of the
        foregoing Laws. 

       

      3.14 Legal
        Proceedings.
        There
        is no Legal Proceeding or Order (a) pending or, to the Knowledge of the Company,
        threatened or anticipated against or affecting the Company, its assets or
        the
        Business (or to the Knowledge of the Company, pending or threatened, against
        any
        of the officers, directors or employees of the Company with respect to their
        business activities related to or affecting the Business); (b) that challenges
        or that may have the effect of preventing, making illegal, delaying or otherwise
        interfering with any of the Transactions; or (c) related to the Business
        or the
        Company’s assets to which the Company is otherwise a party. To the Knowledge of
        the Company, there is no reasonable basis for any such Legal Proceeding or
        Order. Except as set forth on Schedule
        3.14
        of the
        Disclosure Schedules, to the Knowledge of the Company, no officer, director,
        agent or employee of the Company is subject to any Order that prohibits such
        officer, director, agent or employee from engaging in or continuing any conduct,
        activity, or practice relating to the Business. Except as set forth on
Schedule
        3.14,
        neither
        the Company, its assets or the Business is subject to any Order of any
        Regulatory Authority and the Company is not engaged in any Legal Proceeding
        to
        recover monies due it or for damages sustained by it. The Company is not
        and has
        not been in default with respect to any Order, and there are no unsatisfied
        judgments against the Company, its assets or the Business. There is not a
        reasonable likelihood of an adverse determination of any pending Legal
        Proceedings. There are no Orders or agreements with, or Liens by, any Regulatory
        Authority or quasi-governmental entity relating to any environmental Law,
        which
        regulate, obligate, bind or in any way affect the Company or any property
        on
        which the Company operates the Business.

       

      
        
           

        

        
          23

          
            

          

        

        
           

        

      

      3.15 Compliance
        with Law.
        

       

      (a) The
        Company, to its Knowledge, and the conduct of the Business are and at all
        times
        have been in compliance with all Laws or Orders applicable to them or to
        the
        conduct and operations of the Business. The Company has not received any
        notice
        to the effect that, or otherwise been advised of (i) any actual, alleged,
        possible or potential violation of, or failure to comply with, any such Laws
        or
        Orders or (ii) any actual, alleged, possible or potential obligation on the
        part
        of the Company to undertake, or to bear all or any portion of the cost of,
        any
        remedial action of any nature. No event has occurred or circumstance exists
        that
        (with or without notice or lapse of time) (i) may constitute or result in
        a
        violation by the Company of, or a failure on the part of the Company, any
        such
        Laws or Orders or (ii) may give rise to any obligation on the part of the
        Company to undertake, or to bear all or any portion of the cost of, any remedial
        action of any nature, except, in either case separately or the cases together,
        where such violation or failure to comply could not reasonably be expected
        to
        have a Material Adverse Effect. 

       

      (b) None
        of
        the Company, or any of its directors, officers or Representatives or to the
        Knowledge of the Company, any employee or other Person affiliated with or
        acting
        for or on behalf of the Company, has, directly or indirectly, (i) made any
        contribution, bribe, rebate, payoff, influence payment, kickback or other
        payment to any Person, private or public, regardless of form, whether in
        money,
        property or services (A) to obtain favorable treatment in securing business,
        (B)
        to pay for favorable treatment for business secured, (C) to obtain special
        concessions or for special concessions already obtained, for or in respect
        of
        the Company or any of its Affiliates or (D) in violation of any Laws of the
        United States (including, without limitation, the Foreign Corrupt Practices
        Act
        of 1977, as amended (15 U.S.C. Sections 78dd-1 et seq.)) or any laws of any
        other country having jurisdiction; or (ii) established or maintained any
        fund or
        asset that has not been recorded in the Books and Records of the
        Company.

       

      3.16 Permits.
        Schedule
        3.16(a)
        of the
        Disclosure Schedules sets forth a complete list of all Permits held by the
        Company or used in the conduct of the Business, and such Permits collectively
        constitute all of the Permits necessary for the Company to lawfully conduct
        and
        operate the Business, as it is presently conducted and to permit the Company
        to
        own and use its assets in the manner in which they are presently owned and
        used.
        Except as set forth on Schedule
        3.16(b)
        of the
        Disclosure Schedules, the Company is and at all times has been in compliance
        with all material Permits applicable to it or to the conduct and operations
        of
        the Business. The Company has not received any notice to the effect that,
        or
        otherwise been advised of (i) any actual, alleged, possible or potential
        violation of, or failure to comply with, any such Permits or (ii) any actual,
        alleged, possible or potential revocation, withdrawal, suspension, cancellation
        or termination of, or any modification to, any Permit set forth on or required
        to be set forth on Schedule
        3.16(a)
        of the
        Disclosure Schedules. No event has occurred, and to the Company’s Knowledge no
        circumstance exists, that (with or without notice or lapse of time) (i) may
        constitute or result directly or indirectly in a violation by the Company
        of, or
        a failure on the part of the Company to comply with, any such Permits or
        (ii)
        result directly or indirectly in the revocation, withdrawal, suspension,
        cancellation or termination of, or any modification to, any Permit set forth
        on
        or required to be set forth on Schedule
        3.16(a)
        of the
        Disclosure Schedules. All applications for or renewals of all Permits have
        been
        timely filed and made and no Permit will expire or be terminated as a result
        of
        the consummation of the transactions contemplated by this Agreement. No present
        or former shareholder, director, officer or employee of the Company or any
        Affiliate thereof, or any other Person, owns or has any proprietary, financial
        or other interest (direct or indirect) in any Permit that the Company owns,
        possesses or uses.

       

      
        
           

        

        
          24

          
            

          

        

        
           

        

      

      3.17 Absence
        of Certain Changes.
        Except
        as set forth on Schedule
        3.17
        of the
        Disclosure Schedules, since the Company Financial Statement Date, there has
        not
        been any: (a) Material Adverse Effect and no event has occurred and no
        circumstance exists that may result in a Material Adverse Effect other than
        Material Adverse Effects resulting from historical seasonality of the Business;
        (b) purchase, redemption, retirement or other acquisition by the Company
        of any
        capital stock or other equity interest of the Company; (c) amendments to
        the
        Articles of Incorporation and Bylaws of the Company; (d) payment or increase
        by
        the Company of any bonuses, salaries or other compensation (including management
        or other similar fees) or entry into any employment, severance or similar
        Contract with any employee engaged in the Business and which the Surviving
        Corporation is required to hire after Closing, other than increases in salary
        to
        employees made in the Ordinary Course of Business; (e) adverse change in
        employee relations which has or is reasonably likely to have a Material Adverse
        Effect; (f) damage to or destruction or loss of any of the assets or property
        of
        the Company relating to the Business, whether or not covered by insurance,
        that
        could reasonably be expected to constitute a Material Adverse Effect on the
        Business; (g) entry into, termination or acceleration of, or receipt of notice
        of termination by the Company of (1) any material license, distributorship,
        dealer, sales representative, joint venture, credit or similar agreement
        relating to the Business, or (2) any Contract or transaction involving a
        Liability by or to the Company for which the Surviving Corporation may be
        liable
        after the Closing (other than the Liabilities set forth on Schedule
        3.8,
        Liabilities reflected on in the Interim Balance Sheet which have not been
        paid
        or discharged since the Interim Balance Sheet Date, and Liabilities relating
        to
        the Business incurred in the Ordinary Course of Business since the Interim
        Balance Sheet Date); (h) sale (other than sales of inventory in the Ordinary
        Course of Business, if any), lease or other disposition of any of the assets
        or
        property of the Company relating to the Business; (i) mortgage, pledge or
        imposition of any Lien on any assets or property of the Company relating
        to the
        Business, including the sale, lease or other disposition of any of its
        Intellectual Property relating to the Business; (j) (1) delay or failure
        to
        repay when due any obligation of the Company, which delay or failure could
        have
        a Material Adverse Effect on the Company, other than such items as have been
        specifically documented to Parent in writing or (2) delay or failure to repay
        when due any obligation of the Company which delay or failure could have
        a
        Material Adverse Effect on the Company, the Business or on any assets or
        property of the Company relating to the Business; (k) cancellation or waiver
        by
        the Company of any claims or rights with a value to the Company relating
        to the
        Business in excess of Five Thousand Dollars ($5,000) individually or in the
        aggregate; (l) failure by the Company to use reasonable efforts to preserve
        intact the current business organization of the Company relating to the
        Business, and maintain the relations and goodwill with its suppliers, customers,
        landlords, creditors, employees, licensors, resellers, distributors, agents
        and
        others having business relationships with them relating to the Business where
        such failure could reasonably be expected to have a Material Adverse Effect
        on
        the Company; (m) licensing out on an exclusive basis or other than in the
        Ordinary Course of Business, disposition or lapsing of any Intellectual Property
        or any disclosure to any Person of any trade secret or other confidential
        information without appropriate protections in place; (n) change in the
        accounting methods, principles or practices used by the Company; (o) capital
        expenditures by the Company relating to the Business in excess of $20,000
        individually or $50,000 in the aggregate; or (p) agreement, whether oral
        or
        written, by the Company with respect to or to do any of the foregoing other
        than
        as expressly provided for herein.

       

      3.18 Insurance.
        Schedule
        3.18
        of the
        Disclosure Schedules sets forth a complete and accurate list (showing as
        to each
        policy or binder the carrier, policy or binder the carrier, policy number,
        coverage limits, expiration dates, annual premiums and a general description
        of
        the type of coverage provided) of all policies or binders of insurance of
        any
        kind or nature covering the Company, the Business, or any employees, properties
        or assets of the Company relating to the Business, including, without
        limitation, policies of life, disability, fire, theft, workers compensation,
        employee fidelity and other casualty and liability insurance. All such policies
        are in full force an effect. The Company is not in default under any of such
        policies or binders, and the Company has not failed to give any notice or
        to
        present any claim under any such policy or binder in a due and timely
        fashion.

       

      3.19 Restrictions
        on Business Activities.
        There
        is no agreement, judgment, injunction, order or decree binding upon the Company
        or any of its Subsidiaries which has the effect of prohibiting or materially
        impairing (a) any current or future business practice of the Company or any
        of
        its Subsidiaries or (b) any acquisition of any Person or property by the
        Company
        or any of its Subsidiaries, except in each of clauses (a) and (b) for any
        such
        prohibitions or impairments that would not reasonably be expected to have
        a
        Material Adverse Effect.

       

      3.20 Related
        Party Transactions.
        Except
        as set forth on Schedule
        3.20
        of the
        Disclosure Schedules, none of the Company, any Affiliate thereof, holders
        of the
        capital stock or other ownership interest of the Company or any Affiliate
        or
        Family Member thereof is presently or has, since the Interim Financial
        Statements, borrowed any moneys from or has any outstanding debt or other
        obligations to the Company or is presently a party to any transaction with
        the
        Company relating to the Business. Except as set forth on Schedule
        3.20
        of the
        Disclosure Schedules, none of the Company, any Affiliate thereof, or any
        director, officer or key employee of any such Persons (a) owns any direct
        or
        indirect interest of any kind in (except for ownership of less than 1% of
        any
        public company, provided, that such owner’s role is that solely of a passive
        investor), or controls or is a director, officer, employee or partner of,
        consultant to, lender to or borrower from, or has the right to participate
        in
        the profits of, any Person which is (i) a competitor, supplier, customer,
        landlord, tenant, creditor or debtor of the Company, (ii) engaged in a business
        related to the Business or (iii) a participant in any transaction to which
        the
        Company is a party, or (b) is a party to any Contract with the Company. Except
        as set forth on Schedule
        3.20
        of the
        Disclosure Schedules, the Company has no Contract or understanding with any
        officer, director or key employee of the Company or any of the Company’s
        shareholders or any Affiliate or Family Member thereof with respect to the
        subject matter of this Agreement, the consideration payable hereunder or
        any
        other matter.

       

      3.21 Brokers
        or Finders.
        Except
        as set forth on Schedule
        3.21
        of the
        Disclosure Schedules, all negotiations relative to this Agreement and the
        transactions contemplated hereby have been carried out by the Company or
        its
        Affiliates in connection with the transactions contemplated by this Agreement,
        and neither the Company, or Affiliates has incurred any obligation to pay
        any
        brokerage or finder’s fee or other commission in connection with the transaction
        contemplated by this Agreement.

       

      
        
           

        

        
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      3.22 No
        Other Agreements.
        Except
        as set forth on Schedule
        3.22
        of the
        Disclosure Schedules, and other than this Agreement or any agreement
        contemplated hereby, neither the Company, nor any of its stockholders, officers,
        directors or Affiliates has any legal obligation, absolute or contingent,
        to any
        other Person to sell, assign or transfer any capital stock of or other equity
        interest (other than warrants or options in favor of the Company’s officers,
        directors or employees, if any) in the Company or to effect any merger,
        consolidation or other reorganization of the Company or to enter into any
        agreement with respect thereto.

       

      3.23 Disclosure.
        No
        representation or warranty of the Company in this Agreement or in any Ancillary
        Agreement and no statement in any certificate furnished or to be furnished
        by
        the Company pursuant to this Agreement contained, contains or will contain
        on
        the date such agreement or certificate was or is delivered, or on the Closing
        Date, any untrue statement of a material fact, or omitted, omits or will
        omit on
        such date to state any material fact necessary in order to make the statements
        made, in light of the circumstances under which they were made, not
        misleading.

       

      3.24 Real
        Property; Title to Property.
        

       

      (a) The
        Company does not own any real property or any interest, other than a leasehold
        interest, in any real property. Schedule
        3.24(a)
        of the
        Disclosure Schedules lists and describes all real property leased by the
        Company
        and its Subsidiaries and all subleases thereto. Except for Leases and subleases
        listed on Schedule
        3.24(a)
        of the
        Disclosure Schedules, there are no leases, subleases, licenses, occupancy
        agreements, options, rights, concessions or other agreements or arrangements,
        written or oral, granting to any Person the right to purchase, use or occupy
        any
        real property used in connection with the Business or any portion thereof
        or
        interest in any such real property.

       

      (b) The
        Company and its Subsidiaries have good and marketable title to all of its
        properties, interests in properties and assets, real and personal, reflected
        in
        the Company Financial Statements or acquired after the Company Financial
        Statement Date, or with respect to leased properties and assets, valid leasehold
        interests in, free and clear of all mortgages, liens, pledges, charges or
        encumbrances of any kind or character, except (i) Liens for current Taxes
        not
        yet due and payable or which are being contested by the Company in good faith,
        (ii) such imperfections of title, liens and easements as do not and will
        not
        materially detract from or interfere with the use of the properties subject
        thereto or affected thereby, or otherwise materially impair business operations
        involving such properties, (iii) Liens securing debt which is reflected on
        the
        Company Financial Statements, and (iv) any Liens set forth on Schedule
        3.24
        of the
        Disclosure Schedules. The properties and equipment of the Company that are
        used
        in the operation of the Business are in good operating condition subject
        to
        normal wear and tear. All material properties used in the Business are reflected
        in the Company Financial Statements. 

       

      3.25 Conduct
        of Business.
        Prior
        to the Closing Date, the Company shall conduct its business in the normal
        course, and shall not sell, pledge, or assign any assets, without the prior
        written approval of Parent, except in the regular course of business. Except
        as
        otherwise provided herein, the Company shall not amend its Articles of
        Incorporation or ByLaws, declare dividends, redeem or sell stock or other
        securities, acquire or dispose of fixed assets, change employment terms,
        enter
        into any material or long-term contract, guarantee obligations of any third
        party, settle or discharge any material balance sheet receivable for less
        than
        its stated amount, pay more on any liability than its stated amount or enter
        into any other transaction other than in the regular course of
        business.

       

      
        
           

        

        
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      3.26 Restricted
        Securities.
        The
        Selling Stockholders hereby acknowledge and understand that the shares of
        Parent
        Common Stock issuable to the Selling Stockholders, as the Merger Stock
        Consideration, pursuant to the Merger shall be restricted securities and
        agree
        that such restricted securities may not be sold, offered for sale, transferred,
        pledged, hypothecated or otherwise disposed of except in compliance with
        the
        Securities Act, and all other applicable securities laws and
        regulations.

       

      3.27 Accredited
        Investor.
        Each
        Selling Stockholder represents and warrants as follows:

       

      (a) Such
        Selling Stockholder is an “accredited investor” as defined in Rule 501(a) of
        Regulation D, promulgated under the Securities Act;

       

      (b) Such
        Selling Stockholder has sufficient knowledge and experience in investing
        in
        companies similar to Parent so as to be able to evaluate the risks and merits
        of
        its investment in Parent and it is able financially to bear the risks
        thereof;

       

      (c) Such
        Selling Stockholder has sufficient knowledge and experience in investing
        in
        companies similar to Parent so as to be able to evaluate the risks and merits
        of
        its investment in Parent and it is able financially to bear the risks thereof,
        has adequate means of providing for its current financial needs and possible
        contingencies that may face it and has no need for liquidity in its investment
        in Parent;

       

      (d) It
        is the
        present intention that the shares of Parent Common Stock being acquired by
        the
        Selling Stockholder pursuant to the transactions contemplated by this Agreement
        are being acquired for investment and not with a present view to or for sale
        in
        connection with any distribution thereof; and

       

      (e) The
        Selling Stockholder further represents that he does not presently have any
        contract, undertaking, agreement or arrangement with any person to sell,
        transfer or grant participations to such person or any third person with
        respect
        to the shares of Parent Common Stock being acquired under this
        Agreements.

       

      ARTICLE
        4

      REPRESENTATIONS
        AND WARRANTIES OF PARENT AND MERGER SUB

       

      Except
        as
        set forth on the Disclosure Schedules, Parent and Merger Sub hereby, jointly
        and
        severally, represent and warrant to the Company that the statements contained
        in
        this Article 4 are true, complete and correct as of the date of this Agreement
        and will be correct and complete as of the Closing Date (as though made then
        and
        as though the Closing Date were substituted for the date of this Agreement
        throughout this Article 4, except in the case of representations and warranties
        stated to be made as of the date of this Agreement or as of another date
        and
        except for changes contemplated or permitted by this Agreement). 

       

      
        
           

        

        
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      4.1 Organization
        and Qualification.
        Each of
        Parent and Merger Sub is duly organized, validly existing and in good standing
        under the Laws of the jurisdiction in which it is organized and has the
        requisite power and authority to carry on its business as now being conducted,
        which such jurisdictions are set forth on Schedule
        4.1(a)
        of the
        Disclosure Schedules. Each of Parent and Merger Sub is duly qualified or
        licensed to do business and is in good standing in each jurisdiction in which
        the nature of its business or the ownership or leasing of its properties
        makes
        such qualification or licensing necessary, other than in such jurisdictions
        where the failure to be so qualified or licensed (individually or in the
        aggregate) has not had and would not reasonably be expected to have a Material
        Adverse Effect. Each of Parent and Merger Sub has delivered to the Company
        complete and correct copies of their respective articles of incorporation
        and
        bylaws, in each case as amended to the date hereof. 

       

      4.2 Authorization;
        Enforceability.
        Each of
        Parent and Merger Sub have the requisite power and authority, and have taken
        all
        action necessary, to execute, deliver and perform their obligations under
        this
        Agreement and any Ancillary Agreement to which either is a party and each
        other
        agreement, document, instrument or certificate contemplated by this Agreement
        and/or any Ancillary Agreement or to be executed by Parent and Merger Sub
        in
        connection with the consummation of the Transactions, and to consummate the
        Transactions. The execution and delivery by Parent and Merger Sub of this
        Agreement and any applicable Ancillary Agreement, and the consummation by
        Parent
        and Merger Sub of the Transactions contemplated hereby, and the performance
        by
        Parent and Merger Sub of its obligations hereunder, have been duly and validly
        authorized by all necessary corporate action on the part of Parent and Merger
        Sub, and no other action on the part of each of Parent and Merger Sub is
        required to authorize the execution, delivery and performance of this Agreement
        and the consummation by each of Parent and Merger Sub of the transactions
        contemplated hereby. This Agreement has been duly and validly executed and
        delivered by each of Parent and Merger Sub and constitutes a legal, valid
        and
        binding obligation of Parent and Merger Sub enforceable against each in
        accordance with its terms, except as such enforceability may be limited by
        bankruptcy, insolvency, moratorium, reorganization and other similar laws
        affecting creditors’ rights generally and the general principles of equity,
        regardless of whether asserted in a proceeding in equity or at law.

       

      4.3 Non-contravention.
        Except
        as set forth on Schedule
        4.3
        hereto,
        the execution, delivery and performance of this Agreement by each of Parent
        and
        Merger Sub does not, and the consummation of the Transactions will not (a)
        contravene, conflict with, or result in any violation or breach of any provision
        of the articles of incorporation or bylaws of each of Parent and Merger Sub,
        (b)
        contravene, conflict with, or result in a violation or breach of any provision
        of any Law, (c) require any consent or other action by any Person under,
        constitute a breach of or default under, or cause or permit the termination,
        cancellation, acceleration or other change of any right or obligation or
        the
        loss of any benefit to which either of Parent or Merger Sub is entitled under
        any provision of any agreement or other instrument binding upon Parent or
        Merger
        Sub or any license, franchise, permit, certificate, approval or other similar
        authorization affecting, or relating in any way to, the assets, property
        or
        business of either of Parent or Merger Sub, or (d) result in the creation
        or
        imposition of any Lien on any of the assets or properties of either of Parent
        or
        Merger Sub, which in the case of clauses (b) or (d) above would have a Material
        Adverse Effect on either of Parent or Merger Sub or on the validity, binding
        effect or enforceability of this Agreement, any Ancillary Agreement, or the
        ability of either of Parent or Merger Sub to perform their obligations under
        this Agreement or any applicable Ancillary Agreement.

       

      
        
           

        

        
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      4.4 Consents
        and Approvals.
        Except
        as set forth on Schedule
        4.4
        of the
        Disclosure Schedules, no consent, approval, authorization or order of,
        registration or filing with, or notice to, any Regulatory Authority or any
        other
        Person is necessary to be obtained, made or given by either of Parent or
        Merger
        Sub in connection with their execution, delivery and performance of this
        Agreement or any applicable Ancillary Agreement or for the consummation by
        each
        of Parent or Merger Sub of the Transactions, except to the extent the failure
        to
        obtain any such consent, approval, authorization or order or to make any
        such
        registration or filing would not have a Material Adverse Effect on either
        of
        Parent or Merger Sub or on the validity, binding effect or enforceability
        of
        this Agreement or any Ancillary Agreement to which Parent or Merger Sub is
        a
        party, or the ability of either of Parent or Merger Sub to perform their
        obligations under this Agreement or any Ancillary Agreement.

       

      4.5 Legal
        Proceedings.
        There
        are no Legal Proceedings pending, or to the Knowledge of each of Parent or
        Merger Sub, threatened that are reasonably likely to prohibit or restrain
        the
        ability of either of Parent or Merger Sub to enter into this Agreement, any
        applicable Ancillary Agreement or consummate the Transactions. 

       

      4.6 Brokers
        or Finders.
        Except
        as set forth on Schedule
        4.6
        of the
        Disclosure Schedules, all negotiations relative to this Agreement and the
        transactions contemplated hereby have been carried out by Parent and Merger
        Sub
        or their Affiliates in connection with the transactions contemplated by this
        Agreement, and neither Parent nor Merger Sub, or their Affiliates, has incurred
        any obligation to pay any brokerage or finder’s fee or other commission in
        connection with the transaction contemplated by this Agreement

       

      4.7 Merger
        Stock Consideration.
        The
        Merger Stock Consideration issuable to the Selling Stockholders pursuant
        to the
        terms of this Agreement, when issued as contemplated hereunder, will be duly
        authorized, validly issued, fully paid and non-assessable shares of Parent
        Common Stock. The offer and issuance by Parent to the Selling Stockholders
        of
        the Merger Stock Consideration is exempt from registration pursuant to
        Regulation D promulgated under the Securities Act. 

       

      4.8 Acknowledgement
        Regarding Selling Stockholders’ Acquisition of Parent Common
        Stock.
        Parent
        hereby acknowledges that each Selling Stockholder is acting solely in the
        capacity of an arm’s length seller with respect to the transactions contemplated
        by this Agreement and that none of the Selling Stockholder is (i) an officer
        or
        director of Parent, (ii) to the Knowledge of Parent, an “affiliate” (as defined
        in Rule 144 promulgated under the Securities Act) of Parent or any of Parent’s
        Subsidiaries, or (iii) to the Knowledge of Parent, a “beneficial” owner of more
        than 10% of the shares of Parent Common Stock. Parent further acknowledges
        that
        no Selling Stockholder has acted as a financial advisor or fiduciary of Parent
        or any of its Subsidiaries (or in any similar capacity) in respect of this
        Agreement and the transactions contemplated hereby. Parent further represents
        that Parent’s decision to enter into this Agreement is solely based on the
        independent evaluation by Parent and its Representatives.

       

      
        
           

        

        
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      ARTICLE
        5

      PRE-CLOSING
        COVENANTS OF THE PARTIES

       

      5.1 Key
        Employee Agreements.
        As soon
        as practicable following the execution of this Agreement, but in any event
        prior
        to the Closing Date, each of the Selling Stockholders shall execute and enter
        into employment agreements with the Surviving Corporation, in substantially
        the
        forms attached hereto as Exhibit
        D
        (the
“Ballard
        Employment Agreement”),
        Exhibit
        E
        (the
“Boulay
        Employment Agreement”),
        and
Exhibit
        F
        (the
“Granath
        Employment Agreement,”
and
        together with Ballard Employment Agreement and Boulay Employment Agreement,
        the
“Key
        Employee Agreements”),
        subject to the terms and conditions set forth in each such Key Employee
        Agreements.

       

      5.2 Access
        to Information.
        The
        Parties shall provide to each other and their respective representatives
        such
        financial, operating and other documents, data and information relating to
        the
        Party, and their respective businesses, properties, assets and liabilities,
        as
        each Party, or its representatives may reasonably request. In addition, each
        Party hereby agrees to take all action necessary to enable their respective
        representatives to review, inspect and audit each Party’s business, properties,
        assets and liabilities and discuss them with such Party’s officers, employees,
        independent accountants and counsel. Notwithstanding any investigation that
        any
        Party may conduct of the other Parties, or their respective businesses,
        properties, assets and liabilities, each Party may fully rely on the other
        Party’s warranties, covenants and indemnities set forth in this Agreement.

       

      5.3 Consents
        and Approvals.
        As soon
        as practicable after execution of this Agreement, the Parties shall use
        commercially reasonable efforts to obtain any necessary consent, approval,
        authorization or order of, make any registration or filing with or give any
        notice to, any Regulatory Authority or Person as is required to be obtained,
        made or given by any Party to consummate the transactions contemplated by
        this
        Agreement and the Ancillary Agreements. 

       

      5.4 Notification
        of Adverse Change and Certain Matters.
        Each
        Party shall promptly notify the other Party of any material adverse change
        in
        the condition (financial or otherwise) of such Party. Each Party shall promptly
        notify the other Party of any fact, event, circumstance or action known to
        it
        that is reasonably likely to cause such Party to be unable to perform any
        of its
        covenants contained herein or any condition precedent in Article 7 not to
        be
        satisfied, or that, if known on the date of this Agreement, would have been
        required to be disclosed to another Party pursuant to this Agreement or the
        existence or occurrence of which would cause any of the such Party’s
        representations or warranties under this Agreement not to be correct and/or
        complete. Each Party shall give prompt written notice to the other Party
        of any
        adverse development causing a breach of any of the representations and
        warranties in Articles 3 and 4 as of the date made.

       

      5.5 Disclosure
        Schedule.
        Each
        Party shall, from time to time prior to Closing, supplement the Disclosure
        Schedules attached hereto with additional information that, if existing or
        known
        to it on the date of delivery to the other Party, would have been required
        to be
        included therein. For purposes of determining the satisfaction of any of
        the
        conditions to the obligations of any Party in Article 7, the Disclosure
        Schedules of such Party shall be deemed to include only (a) the information
        contained therein on the date of this Agreement and (b) information added
        to
        such Party’s Disclosure Schedule by written supplements delivered prior to
        Closing by such Party, if such written supplements (i) are accepted in writing
        by the receiving Party, or (ii) reflect actions taken or events occurring
        after
        the date hereof prior to Closing. 

       

      
        
           

        

        
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      5.6 State
        Statutes.
        The
        Parties and their respective Board of Directors shall, if any state takeover
        statute or similar law is or becomes applicable to the Merger, this Agreement
        or
        any of the transactions contemplated by this Agreement, use all reasonable
        efforts to ensure that the Merger and the other transactions contemplated
        by
        this Agreement may be consummated as promptly as practicable on the terms
        contemplated by this Agreement and otherwise to minimize the effect of such
        statute or regulation on the Merger, this Agreement and the transactions
        contemplated hereby.

       

      5.7 Conduct
        of Business.
        During
        the period from the date of this Agreement and continuing until the earlier
        of
        the termination of this Agreement pursuant to the provisions of Article 9
        hereof
        or the Closing, Parent shall direct the day-to-day operations of the Company
        and
        approve all non-recurring transactions and significant recurring transactions
        undertaken by the Company. Further, during such period, the Company shall
        (unless otherwise required by this Agreement or Parent has given its prior
        written consent to the Company) carry on its business in the ordinary course
        consistent with past practice, pay its Taxes and other obligations consistent
        with its past practices, pay or perform other obligations when due consistent
        with its past practices, subject to any good faith disputes over such Taxes
        and
        other obligations and, to the extent consistent with the Business, use
        reasonable efforts and institute all policies to preserve intact its present
        business organization, keep available the services of its present officers
        and
        key employees, preserve its relationships with customers, suppliers,
        distributors, licensors, licensees, independent contractors and other Persons
        having business dealings with it and to cause its Subsidiaries to do the
        same,
        all with the express purpose and intent of preserving unimpaired its goodwill
        and ongoing businesses at the Closing. Parent shall assume the risk of losses
        incurred, and the benefit of profits earned, during such period, unless this
        Agreement is otherwise terminated pursuant to Article 9 hereof.

       

      5.8 No
        Solicitation.
        Until
        the earlier of the Closing or the date of termination of this Agreement pursuant
        to the provisions of Article 9 hereof, neither the Company, the Selling
        Stockholders nor any of their respective stockholders, officers, directors,
        agents, investment bankers or other representatives of any of them
        (collectively, the “Representatives”)
        will,
        directly or indirectly, (i) solicit, engage in discussions or negotiate with
        any
        Person (regardless of who initiates such discussions or negotiations), or
        take
        any other action intended or designed to facilitate the efforts of any Person,
        other than the Parties hereto, relating to the possible acquisition of the
        Company (whether by way of purchase of capital stock, purchase of assets
        or
        otherwise) or any significant portion of its capital stock or assets by any
        Person other than the Parties hereto (an “Alternative
        Acquisition”),
        (ii)
        provide information with respect to the Company to any Person relating to
        a
        possible Alternative Acquisition by any Person, (iii) enter into an agreement
        with any Person providing for a possible Alternative Acquisition, or (iv)
        make
        or authorize any statement, recommendation or solicitation in support of
        any
        possible Alternative Acquisition by any Person. The Company shall cause its
        Representatives to immediately cease and cause to be terminated all existing
        discussions or negotiations with any Person heretofore conducted with respect
        to
        any possible Alternative Acquisition.

       

      
        
           

        

        
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      5.9 Confidentiality.
        Each of
        Parent, Merger Sub and the Company acknowledge and agree that the terms and
        conditions described in this Agreement, including its existence, as well
        as the
        non-public information and data furnished to them or their respective
        Representatives from the first introduction of the Parties and throughout
        the
        negotiation and drafting of this Agreement is confidential and will not be
        disclosed to any third party, or used for any purpose not specifically
        contemplated herein, without prior written consent of the other Party, unless
        otherwise required by Law or unless it ceases to be confidential through
        no
        breach of the receiving party.

       

      5.10 Meeting
        of the Stockholders.
        Promptly after the date hereof, if required under applicable law, each Party
        will take all action necessary in accordance with its articles of incorporation
        and bylaws, or other charter or organizational documents, to convene a meeting
        of their respective stockholders, or seek the written consent of its
        stockholders to consider the adoption and approval of this Agreement and
        approval of the Merger to be held as promptly as practicable, but in any
        event
        prior to the Closing Date.

       

      5.11 Continuing
        Employees.
        As soon
        as practicable following the execution of this Agreement, but in any event
        prior
        to the Closing Date, Parent shall make offers of employment to all employees
        of
        the Company existing as of the Closing Date (other than the Selling
        Stockholders, the “Continuing
        Employees”),
        which
        offers shall be based on same salary and benefits as presently provided by
        the
        Company to such employees.

       

      5.12 Pre-Closing
        Cooperation.
        Between
        the date of this Agreement and the Closing Date, the Company shall, and Selling
        Stockholders shall cause the Company to, (i) afford Parent and its
        Representatives full and free access to the Company’s personnel, properties,
        Contracts, books and records, and other documents and data, and (ii) cooperate
        with Parent and its Representatives, including providing any relevant documents,
        in connection with an accounting review and audit of the Company.

       

      ARTICLE
        6

      POST-CLOSING
        COVENANTS OF THE PARTIES

       

      6.1 Non-Competition.
        In
        connection with the sale of Company Common Stock and the other transactions
        contemplated by this Agreement, Parent and each Selling Stockholder agree
        to be
        bound by the non-competition provisions contemplated and set forth in the
        Key
        Employee Agreements.

       

      6.2 Post-Closing
        Cooperation.
        Following the Closing Date, the Selling Stockholders shall cause the Company
        to
        cooperate with Parent and its Representatives, including providing any relevant
        documents, in connection with any post-Closing accounting review and audit
        of
        the Company.

       

      6.3 SEC
        Reports.
        Following the Closing Date, Parent agrees to timely file all reports required
        to
        be filed with the Securities and Exchange Commission pursuant to the Securities
        Act and the Securities Exchange Act of 1934, as amended.

       

      
        
           

        

        
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      ARTICLE
        7

      CLOSING
        CONDITIONS

       

      7.1 Conditions
        to Company and Selling Stockholder’s Obligations to Close.
        The
        obligations of the Company and Selling Stockholders to consummate the
        transactions provided for hereby are subject to the satisfaction, before
        or on
        the Closing Date, of each of the conditions set forth below in this Section
        7.1,
        any of which may be waived by either of the Company and Selling
        Stockholders:

       

      (a) Accuracy
        of Representations.
        All
        representations and warranties of each of Parent and Merger Sub contained
        in
        this Agreement, the Ancillary Agreements and any certificate delivered by
        any of
        them at or prior to Closing shall be, if specifically qualified by materiality,
        true in all respects and, if not so qualified, shall be true in all material
        respects, in each case on and as of the Closing Date with the same effect
        as if
        made on and as of the Closing Date, except for representations and warranties
        expressly stated to be made as of the date of this Agreement or as of another
        date other than the Closing Date and except for changes contemplated or
        permitted by this Agreement. Parent shall have delivered to the Company a
        certificate dated the Closing Date to the foregoing effect.

       

      (b) Covenants.
        Parent
        and Merger Sub shall, in all material respects, have performed and complied
        with
        each of the covenants, obligations and agreements contained in this Agreement
        and the Ancillary Agreements that are to be performed or complied with by
        them
        at or prior to Closing. Parent shall have delivered to the Company a certificate
        dated the Closing Date to the foregoing effect.

       

      (c) Consents
        and Approvals.
        All
        consents, approvals, permits, authorizations and orders required to be obtained
        from, and all registrations, filings and notices required to be made with
        or
        given to any Regulatory Authority or Person as provided herein, if any, shall
        have been so obtained or filed with such Regulatory Authority or Person.
        

       

      (d) Key
        Employee Agreements.
        The Key
        Employee Agreements shall have been executed and delivered to the Company
        pursuant to Article 5 hereof.

       

      (e) Continuing
        Employees.
        Parent
        shall have made offers of employment to the Continuing Employees pursuant
        to
        Article 5 hereof.

       

      (f) No
        Legal Proceedings.
        No
        injunction, action, suit or proceeding shall be pending or threatened by
        or
        before any Regulatory Authority and no Law shall have been enacted, promulgated
        or issued or deemed applicable to any of the transactions contemplated by
        this
        Agreement and the Ancillary Agreements, which would: (i) prevent consummation
        of
        any of the transactions contemplated by this Agreement and the Ancillary
        Agreements; (ii) cause any of the transactions contemplated by this Agreement
        and the Ancillary Agreements to be rescinded following consummation; or (iii)
        have a Material Adverse Effect on a Party, the Merger, this Agreement or
        the
        transactions contemplated hereby.

       

      (g) Closing
        Deliverables.
        Parent
        and Merger Sub shall have delivered, or caused to be delivered, to the Company
        those certificates set forth in Section 7.1(a) and (b) hereof.

       

      
        
           

        

        
          33

          
            

          

        

        
           

        

      

      7.2 Conditions
        to Parent and Merger Sub’s Obligations to Close.
        The
        obligations of Parent and Merger Sub to consummate the transactions provided
        for
        hereby are subject to the satisfaction, before or on the Closing Date, of
        each
        of the conditions set forth below in this Section 7.2, any of which may be
        waived by Parent:

       

      (a) Accuracy
        of Representations.
        All
        representations and warranties of the Company and of each Selling Stockholder
        contained in this Agreement, the Ancillary Agreements and any certificate
        delivered by any of the Company and Selling Stockholders at or prior to Closing
        shall be, if specifically qualified by materiality, true in all respects
        and, if
        not so qualified, shall be true in all material respects, in each case on
        and as
        of the Closing Date with the same effect as if made on and as of the Closing
        Date, except for representations and warranties expressly stated to be made
        as
        of the date of this Agreement or as of another date other than the Closing
        Date
        and except for changes contemplated or permitted by this Agreement. The Company
        and Selling Stockholders shall have delivered to Parent a certificate dated
        the
        Closing Date to the foregoing effect.

       

      (b) Covenants.
        The
        Company and Selling Stockholders shall, in all material respects, have performed
        and complied with each of the covenants, obligations and agreements contained
        in
        this Agreement and the Ancillary Agreements that are to be performed or complied
        with by them at or prior to Closing. The Company shall have delivered to
        Parent
        a certificate dated the Closing Date to the foregoing effect.

       

      (c) Consents
        and Approvals.
        All
        consents, approvals, permits, authorizations and orders required to be obtained
        from, and all registrations, filings and notices required to be made with
        or
        given to, any Regulatory Authority or Person as provided herein, shall have
        been
        so obtained or filed with such Regulatory Authority or Person. 

       

      (d) Stockholder
        Approval.
        All
        stockholder approval, if any, as required under any applicable Law, shall
        have
        been obtained to approve the transactions contemplated hereunder including
        the
        approval of the Merger, this Agreement or the transactions contemplated
        hereby.

       

      (e) Key
        Employee Agreements.
        The Key
        Employee Agreements shall have been executed and delivered to Parent pursuant
        to
        Article 5 hereof.

       

      (f) No
        Legal Proceedings.
        No
        injunction, action, suit or proceeding shall be pending or threatened by
        or
        before any Regulatory Authority and no Law shall have been enacted, promulgated
        or issued or deemed applicable to any of the transactions contemplated by
        this
        Agreement and the Ancillary Agreements, which would: (i) prevent consummation
        of
        any of the transactions contemplated by this Agreement and the Ancillary
        Agreements; (ii) cause any of the transactions contemplated by this Agreement
        and the Ancillary Agreements to be rescinded following consummation; or (iii)
        have a Material Adverse Effect on a Party, the Merger, this Agreement or
        the
        transactions contemplated hereby.

       

      (g) No
        Material Adverse Change.
        There
        shall have been no material adverse change in the business, financial condition
        or operations of the Company.

       

      
        
           

        

        
          34

          
            

          

        

        
           

        

      

      (h) Closing
        Deliverables.
        The
        Company and Selling Stockholders shall have delivered, or caused to be
        delivered, to Parent those certificates set forth in Section 7.2(a) and (b)
        hereof.

       

      (i) Audit.
        Parent
        and its Representatives shall have completed the accounting review and audit
        contemplated under Section 5.11 hereof

       

      (j) Financing.
        Parent
        shall have successfully raised, or shall have available at its disposal,
        $1,000,000 in cash to fund the Merger Cash Consideration contemplated in
        Section
        2.5(a) hereof.

       

      ARTICLE
        8

      INDEMNIFICATION

       

      8.1 Survival
        of Representations, Etc.
        All of
        the representations and warranties contained in this Agreement, other than
        the
        representations and warranties contained in Sections 3.1,
        3.2,
        3.9, 3.12, 3.15, 3.20, 4.1, 4.2 and 4.6 shall survive the Closing and shall
        continue in full force and effect for a period of one year after the Closing
        Date. The representations and warranties contained in Sections 3.9, 3.12,
        and
        3.15 shall survive the Closing and shall terminate only when the applicable
        statutes of limitations with respect to the liabilities in question expire,
        in
        each case giving effect to any tolling or extensions thereof. The
        representations and warranties contained in Sections 3.1, 3.2, 3.20, 4.1,
        4.2
        and 4.6 and all covenants and obligations of the Parties made herein shall
        survive the Closing and shall continue in full force and effect indefinitely,
        but in no event shall the survival period extend beyond the expiration of
        the
        statutory term (including any renewals or extensions thereof) of the trademark,
        copyright or patent at issue. The right to indemnification, payment of Losses
        or
        other remedy based on such representations, warranties, covenants and
        obligations will not be affected by any investigation conducted with respect
        to,
        or any knowledge of the party entitled to such right to indemnification acquired
        (or capable of being acquired) at any time, whether before or after the Closing
        Date, with respect to the accuracy or inaccuracy of or compliance with, any
        such
        representation, warranty, covenant or obligation. The waiver of any condition
        based on the accuracy of any representation or warranty, or on the performance
        of or compliance with any covenant or obligation, will not affect the right
        to
        indemnification, payment of Losses, or other remedies based on such
        representations, warranties, covenants and obligations.

       

      8.2 Indemnification.

       

      (a) By
        Selling Stockholders.
        Subject
        to Section 8.3, each Selling Stockholder, jointly and severally, hereby agree
        (without duplication) to indemnify, protect, defend (at Parent’s request),
        release and hold Parent and its directors, officers, managers, members,
        employees, agents, successors, Affiliates and assigns (collectively, the
        “Parent
        Indemnified Parties”)
        harmless from and against any and all Losses incurred in connection with,
        arising out of, resulting from or incident to:

       

      (i) any
        breach or inaccuracy of any representation or warranty of the Company and
        each
        of the Selling Stockholders set forth in this Agreement or contained in any
        certificate delivered by or on behalf of Company pursuant to this
        Agreement;

       

      
        
           

        

        
          35

          
            

          

        

        
           

        

      

      (ii) any
        breach of any covenant or other agreement made by the Company and each of
        the
        Selling Stockholders in or pursuant to this Agreement;

       

      (iii) any
        Liability arising under or with respect to any and all Employee Plans, and
        any
        Liability with respect to any of the Company’s employees, former employees or
        service providers relating to acts or omissions which occurred on or prior
        to
        the Closing Date; 

       

      (iv) any
        claim
        by any Person for brokerage or finder’s fees or commissions or similar payments
        based on any agreement or understanding alleged to have been made by such
        Person
        with the Company or the Selling Stockholders (or any Person acting (or
        purportedly acting) on behalf of any such Person) in connection with the
        transactions contemplated by this Agreement; or

       

      (v) any
        Loss,
        including Taxes, arising in connection with any distributions made to Company
        Stockholders at any time prior to and including the date of the
        Merger.

       

      (b) Indemnification
        by Parent.
        Subject
        to Section 8.3, Parent hereby agrees (without duplication) to indemnify,
        protect, defend (at the Selling Stockholders’ request), release and hold the
        Company and its directors, officers, stockholders, employees, agents, successors
        and assigns (collectively, the “Company
        Indemnified Parties”)
        harmless from and against any and all Losses incurred in connection with,
        arising out of, resulting from or incident to:

       

      (i) any
        breach or inaccuracy of any representation or warranty of Parent and Merger
        Sub
        set forth in this Agreement or contained in any certificate delivered by
        or on
        behalf of Parent and Merger Sub pursuant to this Agreement; 

       

      (ii) any
        breach of any covenant or other agreement made by Parent and Merger Sub in
        or
        pursuant to this Agreement; or

       

      (iii) any
        taxes
        levied on the Selling Stockholders with respect to any income earned from
        operations of the Company between January 2, 2008 through the Closing Date
        (excluding for purposes hereof, any taxes which may be levied on the Selling
        Stockholders in the event that a Regulatory Authority determines that the
        transactions contemplated by this Agreement do not constitute a reorganization
        within the meaning of Section 368 of the Code).

       

      (c) The
        term
“Losses” as used in this Section 8.2 is not limited to matters asserted by third
        parties against any indemnified party, but includes Losses incurred or sustained
        by an indemnified party in the absence of third party claims. Payments by
        an
        indemnified party of amounts for which such indemnified party is indemnified
        under this Article 8 shall not be a condition precedent to
        recovery.

       

      8.3 Limitations
        on Indemnification for Certain Breaches.
        An
        indemnifying party shall not have any Liability under Section 8.2(a) or 8.2(b)
        for any Claims unless the aggregate amount of Losses to the indemnified parties
        finally determined to arise thereunder exceeds Fifty Thousand Dollars ($50,000)
        (the “Indemnification
        Threshold”),
        in
        which event the indemnifying party shall be required to pay the full amount
        of
        such Losses in excess of the Indemnification Threshold; provided,
        however,
        that
        the maximum liability of any party hereunder shall be limited to the
        consideration received by such party under this Agreement.

       

      
        
           

        

        
          36

          
            

          

        

        
           

        

      

      8.4 Indemnification
        Procedures.
        

       

      (a) In
        the
        event that any Legal Proceeding shall be instituted or any claim or demand
        shall
        be asserted (individually and collectively, a “Claim”)
        by any
        Person in respect of which payment may be sought under this Article 8
        (regardless of the provisions of Section 8.3), the indemnified party shall
        reasonably and promptly cause written notice (a “Claim
        Notice”)
        of the
        assertion of any Claim of which it has knowledge which is covered by this
        indemnity to be delivered to the indemnifying party; provided,
        however,
        that
        the failure of the indemnified party to give the Claim Notice shall not release,
        waive or otherwise affect the indemnifying party’s obligations with respect
        thereto, except to the extent that the indemnifying party can demonstrate
        actual
        loss and material prejudice as a result of such failure. If the indemnifying
        party shall notify the indemnified party in writing within five (5) Business
        Days (or sooner, if the nature of the Claim so requires) that the indemnifying
        party shall be obligated under the terms of its indemnity hereunder in
        connection with such lawsuit or action, then the indemnifying party shall
        be
        entitled, if it so elects at its own cost, risk and expense, (i) to take
        control
        of the defense and investigation of such lawsuit or action, (ii) to employ
        and
        engage attorneys of its own choice, but, in any event, reasonably acceptable
        to
        the indemnified party, to handle and defend the same unless the named parties
        to
        such action or proceeding (including any impleaded parties) include both
        the
        indemnifying party and the indemnified party and the indemnified party has
        been
        advised in writing by counsel that there may be one or more material legal
        defenses available to such indemnified party that are different from or
        additional to those available to the indemnifying party, in which event the
        indemnified party shall be entitled, at the indemnifying party’s cost, risk and
        expense, to a single firm of separate counsel (plus any necessary local
        counsel), all at reasonable cost, of its own choosing, reasonably acceptable
        to
        the indemnifying party and (iii) to compromise or settle such lawsuit or
        action,
        which compromise or settlement shall be made only with the prior written
        consent
        of the indemnified party, such consent not to be unreasonably withheld or
        delayed.

       

      (b) If
        the
        indemnifying party elects not to defend against, negotiate, settle or otherwise
        deal with any Claim which relates to any Losses indemnified against hereunder,
        fails to notify the indemnified party of its election as provided in this
        Section 8.4 or contests its obligation to indemnify the indemnified party
        for
        such Losses under this Agreement, the indemnified party may defend against,
        negotiate, settle or otherwise deal with such Claim. If the indemnified party
        defends any Claim, then the indemnifying party shall reimburse the indemnified
        party for the Losses incurred in defending such Claim upon submission of
        periodic bills. If the indemnifying party shall assume the defense of any
        Claim,
        the indemnified party may participate, at its own expense, in the defense
        of
        such Claim; provided,
        however,
        that
        such indemnified party shall be entitled to participate in any such defense
        with
        separate counsel at the expense of the indemnifying party if (i) so requested
        by
        the indemnifying party to participate or (ii) in the reasonable opinion of
        counsel to the indemnified party, a material conflict or potential material
        conflict exists between the indemnified party and the indemnifying party
        that
        would make such separate representation required; and provided,
        further,
        that
        the indemnifying party shall not be required to pay for more than one such
        counsel for all indemnified parties in connection with any Claim. If the
        indemnifying party shall assume the defense of any Claim, the indemnifying
        party
        shall obtain the prior written consent of the indemnified party before entering
        into any settlement of such Claim or ceasing to defend such Claim if, pursuant
        to or as a result of such settlement or cessation, injunctive or other equitable
        relief shall be imposed against the indemnified party or if such settlement
        or
        cessation does not expressly and unconditionally release the indemnified
        party
        from all Liabilities or obligations with respect to such Claim, with prejudice.
        The Parties hereto agree to cooperate fully with each other in connection
        with
        the defense, negotiation or settlement of any Claim. 

       

      
        
           

        

        
          37

          
            

          

        

        
           

        

      

      ARTICLE
        9

      TERMINATION

       

      9.1 Termination.
        This
        Agreement may be terminated, and the transactions contemplated hereby may
        be
        abandoned, at any time prior to the Effective Time.

       

      (a) By
        mutual
        written agreement of the Parties; 

       

      (b) By
        either
        of Parent or the Company if the Closing does not occur on or before March
        15,
        2008, or to be extended by mutual consent of the Parties; 

       

      (c) By
        the
        Company if the stockholders of the Company fail to approve the Merger, this
        Agreement and the transactions contemplated hereby;

       

      (d) By
        either
        of Parent or the Company if any court of competent jurisdiction or other
        competent Regulatory Authority shall have issued an order making illegal
        or
        otherwise permanently restricting, preventing or otherwise prohibiting the
        Merger and such order shall have become final; or

       

      (e) By
        either
        of Parent or the Company upon written notice to the other Party in the event
        of
        a breach of any provision or covenant of this Agreement, or any representation
        or warranty made by such Party hereunder becomes inaccurate; provided,
        however,
        that
        such breach or inaccuracy would cause the related closing condition, if any,
        not
        be satisfied in accordance with Article 7 hereof; provided,
        further,
        that
        prior to any termination by the non-breaching party, such Party shall provide
        written notice to the breaching Party specifically identifying the breach
        or
        inaccurate representation, and the breaching Party does not cure or correct
        such
        breach or inaccuracy within 30 days following receipt of the written
        notice.

       

      9.2 Effect
        of Termination.
        If this
        Agreement is validly terminated by either the Company or Parent pursuant
        to
        Section 9.1, this Agreement will forthwith become null and void and there
        will
        be no liability or obligation on the part of the Parties hereto, except that
        nothing contained herein shall relieve any party hereto from liability for
        willful breach of its representations, warranties, covenants or agreements
        contained in this Agreement. 

       

      
        
           

        

        
          38

          
            

          

        

        
           

        

      

      ARTICLE
        10

      MISCELLANEOUS
        PROVISIONS

       

      10.1 Notices.
        All
        notices, requests and other communications hereunder must be in writing and
        will
        be deemed to have been duly given only if delivered personally against written
        receipt or mailed by prepaid first class registered or certified mail, return
        receipt requested, or sent by overnight courier prepaid, to the parties at
        the
        following addresses or facsimile numbers:

       

      
        	
                If
                  to Parent and Merger Sub to:

                 

                Tix
                  Corporation

                12001
                  Ventura Place, Suite 340

                Studio
                  City, CA 91604

                Attention:
                  Mitch Francis

                Tel:
                  (818) 761-1002

                Fax:
                  (818) 761-1072

              	 
	 	 
	
                with
                  a copy, which shall not constitute notice to:

                 

                Troy
                  & Gould

                1801
                  Century Park East, Suite 1600

                Los
                  Angeles, CA 90067

                Attention:
                  David Ficksman

                Tel:
                  (310) 553-4441

                Fax:
                  (310) 201-4746

              	 
	 	 
	
                If
                  to the Company:

                 

                NewSpace
                  Entertainment, Inc. 

                640
                  E. South Temple, Suite 20

                Salt
                  Lake City, Utah 84102

                Attention:
                  Steve Boulay

                Tel.:
                  (801) 703-2045

                Fax:
                  801-355-2236

              	 
	 	 
	
                with
                  a copy, which shall not constitute notice, to:

                 

                Holland
                  & Hart LLP

                60
                  E. South Temple, Suite 2000

                Salt
                  Lake City, Utah 84111-1031

                Attention:
                  Gregory E. Lindley

                Tel.:
                  (801) 799-5829

                Fax:
                  (801) 799-5700

              	 

      

      

       

      10.2 Entire
        Agreement.
        This
        Agreement supersedes all prior discussions and agreements between the Parties
        with respect to the subject matter hereof and thereof and contains the sole
        and
        entire agreement between the Parties hereto with respect to the subject matter
        hereof and thereof. Except for the representations and warranties contained
        in
        this Agreement or in any instrument delivered pursuant to this Agreement,
        each
        of the Parties to this Agreement acknowledges that no other representations
        or
        warranties have been relied upon by that Party or made by any other party
        or its
        officers, directors, employees, agents, financial and legal advisors or other
        representatives.

       

      
        
           

        

        
          39

          
            

          

        

        
           

        

      

      10.3 Publicity.
        No
        party to this Agreement shall issue any press release or make any public
        announcement regarding the transactions contemplated by this Agreement without
        the prior written approval of the other party.

       

      10.4 Further
        Assurances; Post-Closing Cooperation.
        At any
        time or from time to time after the Closing, the Parties will execute and
        deliver to the other party such other documents and instruments, provide
        such
        materials and information and take such other actions as the other party
        may
        reasonably request to consummate the transactions contemplated by this Agreement
        and otherwise to cause the other Party to fulfill its obligations under this
        Agreement and the transactions contemplated hereby. Each Party agrees to
        use
        commercially reasonable efforts to cause the conditions to its obligations
        to
        consummate the transactions contemplated hereby to be satisfied.

       

      10.5 Amendment.
        This
        Agreement may be amended by the Parties hereto at any time before the Closing
        by
        execution of an instrument in writing signed on behalf of each of the Parties
        hereto and after the Closing by execution of an instrument in writing signed
        on
        behalf of the Surviving Corporation.

       

      10.6 Extension.
        At any
        time prior to the Closing, Parent, Merger Sub and the Company may, to the
        extent
        legally allowed, agree in writing to extend the time for the performance
        of any
        of the obligations of the other party hereto.

       

      10.7 Waiver.
        Any
        term or condition of this Agreement may be waived at any time by the party
        that
        is entitled to the benefit thereof, but no such waiver will be effective
        unless
        set forth in a written instrument duly executed by or on behalf of the party
        waiving such term or condition. No waiver by any party of any term or condition
        of this Agreement, in any one or more instances, will be deemed to be or
        construed as a waiver of the same or any other term or condition of this
        Agreement on any future occasion. All remedies, either under this Agreement
        or
        by Law or otherwise afforded, will be cumulative and not
        alternative.

       

      10.8 Third
        Party Beneficiaries.
        The
        terms and provisions of this Agreement are intended solely for the benefit
        of
        each Party hereto and their respective successors or permitted assigns, and
        it
        is not the intention of the Parties to confer third-party beneficiary rights,
        and this Agreement does not confer any such rights, upon any other Person
        other
        than any Person entitled to indemnity as described in Article 8.

       

      10.9 No
        Assignment; Binding Effect.
        Neither
        this Agreement nor any right, interest or obligation hereunder may be assigned
        (by operation of law or otherwise) by any Party without the prior written
        consent of the other Parties and any attempt to do so will be void. Subject
        to
        the preceding sentence, this Agreement is binding upon, inures to the benefit
        of
        and is enforceable by the Parties hereto and their respective successors
        and
        assigns.

       

      10.10 Captions.
        The
        headings and table of contents used in this Agreement have been inserted
        for
        convenience of reference only and do not define or limit the provisions
        hereof.

       

      
        
           

        

        
          40

          
            

          

        

        
           

        

      

      10.11 Invalid
        Provisions.
        If any
        provision of this Agreement is held to be illegal, invalid or unenforceable
        under any present or future law, and if the rights or obligations of any
        party
        hereto under this Agreement will not be materially and adversely affected
        thereby, (a) such provision will be fully severable, (b) this Agreement will
        be
        construed and enforced as if such illegal, invalid or unenforceable provision
        had never comprised a part hereof, (c) the remaining provisions of this
        Agreement will remain in full force and effect and will not be affected by
        the
        illegal, invalid or unenforceable provision or by its severance herefrom
        and (d)
        in lieu of such illegal, invalid or unenforceable provision, there will be
        added
        automatically as a part of this Agreement a legal, valid and enforceable
        provision as similar in terms to such illegal, invalid or unenforceable
        provision as may be possible.

       

      10.12 Governing
        Law.
        This
        Agreement will be governed by and construed in accordance with the domestic
        laws
        of the State of California, without giving effect to any choice of law or
        conflict of law provision.

       

      10.13 Construction.
        The
        Parties hereto agree that this Agreement is the product of negotiation between
        sophisticated parties and individuals, all of whom were represented by counsel,
        and each of whom had an opportunity to participate in and did participate
        in,
        the drafting of each provision hereof. Accordingly, ambiguities in this
        Agreement, if any, will not be construed strictly or in favor of or against
        any
        Party hereto but rather will be given a fair and reasonable construction
        without
        regard to the rule of contra proferentum.

       

      10.14 Counterparts.
        This
        Agreement may be executed in any number of counterparts, each of which will
        be
        deemed an original, but all of which together will constitute one and the
        same
        instrument.

       

      10.15 Expenses.
        The
        Company and Selling Stockholders, on one hand, and Parent and Merger Sub,
        on the
        other hand, shall each bear its own expenses, including attorneys’, accountants’
and other professionals’ fees, incurred in connection with the negotiation and
        execution of this Agreement and each other agreement, document and instrument
        contemplated by this Agreement and the consummation of the transactions
        contemplated hereby and thereby. 

       

      10.16 Attorneys’
        Fees and Costs.
        In the
        event of any action at law or in equity between the Parties hereto to enforce
        any of the provisions hereof, the unsuccessful party to such litigation shall
        pay to the successful party all costs and expenses, including reasonable
        attorneys’ fees, incurred therein by such successful party; and if such
        successful party shall recover judgment in any such action or proceeding,
        such
        costs, expenses and reasonable attorneys’ fees may be included in and as part of
        such judgment.

       

      10.17 Waiver
        of Jury Trial.
        Each
        party hereto hereby expressly waives any right to trial by jury of any claim,
        demand, action or cause of action arising under or in connection with this
        Agreement or the transactions contemplated hereby.

       

      10.18 Legends.
        Each
        Selling Stockholders understands that the stock certificates representing
        the
        Parent Common Stock shall bear any legend as required by the "blue sky" laws
        of
        any state and a restrictive legend in substantially the following form (and
        a
        stop-transfer order may be placed against transfer of such stock
        certificates):

       

      
        
           

        

        
          41

          
            

          

        

        
           

        

      

      THE
        SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
        THE
        SECURITIES ACT 7OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.
        THE
        SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I)
        IN THE
        ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
        THE
        SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL, IN A GENERALLY
        ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II)
        UNLESS
        SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.

       

      10.19 Representation
        by Counsel.
        Each
        party hereto represents and agrees with each other that it has been represented
        by or had the opportunity to be represented by independent counsel of its
        own
        choosing, and that it has had the full right and opportunity to consult with
        its
        respective attorney(s) to the extent, if any, that it desired, it availed
        itself
        of this right and opportunity, that it or its authorized officers (as the
        case
        may be) have carefully read and fully understand this Agreement in its entirety
        and have had it fully explained to them by such party’s respective counsel, that
        each is fully aware of the contents thereof and its meaning, intent and legal
        effect, and that it or its authorized officer (as the case may be) is competent
        to execute this Agreement and has executed this Agreement free from coercion,
        duress or undue influence.

       

      10.20 Schedules.
        In the
        event of any inconsistency between the statements in the body of this Agreement
        and those in the Disclosure Schedule (other than an exception expressly set
        forth as such in the Disclosure Schedule with respect to a specifically
        identified representation or warranty), the statements in the body of this
        Agreement will control.

       

      10.21 Specific
        Performance.
        The
        Parties hereto agree that irreparable damage would occur in the event that
        Sections 5.9, 6.1, 6.2 and 6.3 of this Agreement are not performed in accordance
        with the specific terms thereof or were otherwise breached. It is agreed
        that
        the Parties will be entitled to an injunction or injunctions to prevent breaches
        of Sections 5.9, 6.1, 6.2 and 6.3 of this Agreement and to enforce specifically
        the terms and provisions thereof in any court having jurisdiction, this being
        in
        addition to any other remedy to which they are entitled at law or in
        equity.

       

      
        
           

        

        
          42

          
            

          

        

        
           

        

      

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

       

      
        	 	
                “PARENT”

                 

                Tix
                  Corporation, 

                a
                  Delaware corporation

                 

                 

                By:

                
                  

                

                Name: Mitch
                  Francis

                Title: Chief
                  Executive Officer

              
	 	 
	 	
                “MERGER
                  SUB”

                 

                NewSpace
                  Acquisition, Inc., 

                a
                  Utah corporation

                 

                 

                
                  By:

                  
                    

                  

                  Name:

                  Title:
                    

                

              
	 	 
	 	
                “COMPANY”

                 

                NewSpace
                  Entertainment, Inc., 

                a
                  Utah corporation

                 

                 

                
                  By:

                  
                    

                  

                  Name:
                    Steve Boulay

                  Title:
                    President

                

              
	 	 
	 	
                “SELLING
                  STOCKHOLDERS”

                 

                By:

                
                  
                    
Name: Steve
                    Boulay

                

                 

                 

                By:

                
                  
                    
Name: John
                    Ballard

                

                 

                 

                By:

                
                  
                    
Name: Bruce
                    Granath

                

                 

              

      

      

      
        
           

        

        
          43

          
            

          

        

        
           

        

      

      EXHIBIT
        INDEX 

      
 

      
        
          	
                  Exhibit
                    A

                	
                  Allocation
                    of Merger Consideration

                
	
                   

                	 
	
                  Exhibit
                    B

                	
                  Form
                    of Stock Power

                
	
                   

                	 
	
                  Exhibit
                    C

                	
                  Company
                    Financial Statements

                
	
                   

                	 
	
                  Exhibit
                    D

                	
                  Ballard
                    Employment Agreement

                
	
                   

                	 
	
                  Exhibit
                    E

                	
                  Boulay
                    Employment Agreement

                
	
                   

                	 
	
                  Exhibit
                    F

                	
                  Granath
                    Employment Agreement

                
	
                   

                	 
	
                  Exhibit
                    G

                	
                  Disclosure
                    Schedules

                
	
                   

                	 

        

      

       

       

      
        
           

        

        
          44

          
            

          

        

        
           

        

      

       

      Exhibit
        A

       

      Allocation
        of Merger Consideration

       

      

       

      
        	
                Form
                  of Merger Consideration

                 

              	
                Ballard

              	
                Boulay

              	
                Granath

              
	
                Merger
                  Cash Consideration

                 

              	
                $650,000

              	
                $250,000

              	
                $100,000

              
	
                Merger
                  Stock Consideration

                 

              	
                371,428
                  shares of Parent Common Stock

              	
                142,857
                  shares of Parent Common Stock

              	
                57,143
                  shares of Parent Common Stock

              

      

      

       

      

 

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
        B

       

      Form
        of
        Stock Power

       

      ASSIGNMENT
        SEPARATE FROM CERTIFICATE

      

      Reference
        is hereby made to that certain Agreement and Plan of Merger, dated as of
        March
        __, 2008, by and among Tix Corporation (“Tix”)
        and
        NewSpace Acquisition, Inc. (“Merger
        Sub”),
        on
        the one hand, and, NewSpace Entertainment, Inc. (the “Company”),
        John
        Ballard, Steve Boulay and Bruce Granath, on the other hand (the “Plan
        of Merger”).
        

      

      Pursuant
        to the terms and subject to the conditions of the Plan of Merger, including,
        without limitation, Section 2.7 thereof, and for good and valuable consideration
        as specified in the Plan of Merger, [Name
        of Selling Stockholder]
        hereby
        sells assigns and transfers unto Tix _____________ common shares of the Company,
        a corporation organized under the laws of the State of Utah, standing in
        the
        undersigned’s name on the books of the Company and evidenced by Certificate No.
        ____ herewith.

      

      

      Dated:
        March __, 2008

      

      

      
        	 	
                
                   

                  By:

                  
                    
[Name
                    of Selling Stockholder]

                

              

      

       

       

      
 

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
        C

       

      Company
        Financial Statements

       

      TBD

       

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
        D

       

      Ballard
        Employment Agreement

       

      [See
        attached]

       

      

       

       

       

       

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
        E

       

      Boulay
        Employment Agreement

       

      [See
        attached]

       

       

       

       

       

       

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
        F

       

      Granath
        Employment Agreement

       

      [See
        attached]

       

      

       

      

       

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Exhibit
        G

       

      Disclosure
        Schedules

       

      [See
        attached]Execution
      Copy

    EMPLOYMENT
      AGREEMENT

    

    This
      Employment Agreement (“Agreement”)
      is
      made and entered into as of March __, 2008 (“Effective
      Date”),
      by
      and between Tix Corporation, a Delaware corporation (the “Company”),
      and
      John Ballard (“Executive”).

     

    
      WITNESSETH:

    

     

    WHEREAS,
      the Company desires to employ Executive, and Executive desires to accept such
      employment on the terms and conditions set forth herein.

     

    NOW,
      THEREFORE, in consideration of the mutual covenants hereinafter set forth,
      the
      parties hereto agree as follows:

    

    1.       Engagement
      and Responsibilities

     

    1.1       Employment.
      Upon
      the terms and subject to the conditions set forth in this Agreement, and
      commencing as of the Effective Date, the Company hereby engages and employs
      Executive, with the title and designation “President” of Tix Productions, Inc.
      (“TPI”).
      Executive hereby accepts such engagement and employment pursuant to the terms
      hereof.
      Executive shall report to the Co- Chief Executive Officers of TPI. 

    

    1.2       Term.
      Unless
      otherwise terminated earlier in accordance with the provisions of this
      Agreement, Executive’s employment hereunder shall commence on the Effective Date
      and expire on the third anniversary of the Effective Date (the “Term”).

    

    1.3       Duties
      and Responsibilities.
      Executive shall perform such administrative, managerial and executive duties
      for
      the Business and TPI as are prescribed by applicable job specifications for,
      and
      such tasks and responsibilities as are customarily vested in and incidental
      to,
      the office of Chief Operating Officer, including, without limitation,
      implementing the directives and such other duties as may be assigned to him
      from
      time to time by the Co-Chief Executive Officers of TPI (collectively, the
“Duties”).

     

    1.4       Executive
      agrees to devote all of Executive’s business time, energy and efforts to TPI and
      will use Executive’s best efforts and abilities faithfully and diligently to
      promote TPI. For so long as Executive is employed hereunder, Executive shall
      not, directly or indirectly, either as an employee, employer, consultant, agent,
      investor, principal, partner, stockholder (except as the holder of less than
      1%
      of the issued and outstanding stock of a publicly held corporation), corporate
      officer or director, or in any other individual or representative capacity,
      engage or participate in any business that is in competition in any manner
      whatsoever with the business of the Company Group, as such businesses are now
      or
      hereafter conducted. Subject to the foregoing prohibition and provided such
      services or investments do not violate any applicable law, regulation or order,
      or interfere in any way with the faithful and diligent performance by Executive
      of the services to the Company otherwise required or contemplated by this
      Agreement, the Company expressly acknowledges that Executive may:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    1.4.1       make
      and manage personal business investments of Executive’s choice without
      consulting the Co-Chief Executive Officers of TPI; and

    

    1.4.2       serve
      in any capacity with any non-profit civic, educational or charitable
      organization. 

    

    1.5       Covenants
      of Executive 

     

    1.5.1       Best
      Efforts.
      Executive
      shall report directly to the Co-Chief Executive Officers of TPI and shall devote
      his best efforts to TPI. Executive shall perform his duties, responsibilities
      and functions hereunder to the best of his abilities in a diligent, trustworthy,
      professional and efficient manner.

    

    1.5.2       Records
      and Reports.
      Executive shall use his best efforts and skills to truthfully, accurately,
      and
      promptly make, maintain, and preserve all records and reports relating to
TPI,
      fully
      account for all money, records, equipment, materials, or other property
      belonging to TPI
      and the
      Company of which he may have custody, and promptly pay and deliver the same
      whenever he may be directed to do so by the Co-Chief
      Executive Officers of TPI.
      Executive agrees that he shall provide
      regular reports to the Co-Chief Executive Officers of TPI on all such matters
      within the scope of Executive’s employment hereunder.

    

    1.5.3       Rules
      and Regulations.
      Executive shall obey all orders and special instructions issued by the
Co-Chief
      Executive Officers of TPI.

    1.5.4       Opportunities.
      Executive shall make all business opportunities of which he becomes aware that
      are relevant to TPI and the Business available to the Company, and to no other
      person or entity or to himself individually.

    1.5.5       Compliance.
      Executive agrees that he shall perform his duties hereunder subject to and
      in
      compliance with all laws, rules and regulations applicable to TPI (including,
      without limitation, any applicable provisions of the Sarbanes-Oxley Act, and
      any
      other laws, rules and regulations applicable to TPI as a wholly owned subsidiary
      of a “reporting” company pursuant to federal securities laws).

    

    2.       Definitions

    

    For
      purposes of this Agreement, the following capitalized terms shall have the
      meanings set forth below:

    

    2.1       “Business”
shall
      the business and operations of TPI during the Term, comprising the production
      and promotion of shows and events, including, without limitation, the historical
      business and operations of Magic Arts and NewSpace (in each case, as acquired
      by
      the Company pursuant to the Merger Agreements), any future shows, events or
      businesses acquired by TPI after the date hereof, and any future shows, events
      or businesses acquired by Company through the efforts of Executive during the
      term of Executive’s employment hereunder.

    

    2.2       “Co-Chief
      Executive Officers of TPI”
shall
      mean, collectively, Lee D. Marshall and Joseph B. Marsh.

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    

    2.3       “Company
      Group”
shall
      mean the Company and all subsidiaries of the Company, including, without
      limitation, TPI. 

    

    2.4       “Effective
      Date”
shall
      mean the date of this Agreement as first set forth above.

    

    2.5       “For
      Cause”
shall
      mean, in the context of a basis for termination of Executive’s employment with
      the Company, that:

    

    2.5.1       Executive
      breaches any material obligation, duty or agreement under this Agreement, which
      breach is not cured or corrected within 15 days of written notice thereof
      from the Company (except for breaches of Sections 1.4, 7
      and
8
      of this
      Agreement, which cannot be cured and for which the Company need not give any
      opportunity to cure); or

    

    2.5.2       Executive
      is grossly negligent in the performance of services to TPI, or commits any
      act
      of personal dishonesty, fraud, breach of fiduciary duty or trust that causes
      or
      is likely to cause material harm to the Company or TPI; or

    

    2.5.3       Executive
      is convicted of, or pleads guilty or nolo contendere with respect to, theft,
      fraud, a crime involving moral turpitude, or a felony under federal or
      applicable state law; or

    

    2.5.4       Executive
      commits any act of personal conduct that gives rise to a material risk of
      liability under federal or applicable state law for discrimination or sexual
      or
      other forms of harassment or other similar liabilities to subordinate employees;
      or

     

    2.5.5       Executive
      commits continued and repeated substantive violations of specific written
      directions of the Co-Chief Executive Officers of TPI, which directions are
      consistent with this Agreement and Executive’s position as an executive officer,
      or continued and repeated substantive failure to perform duties assigned by
      or
      pursuant to this Agreement; provided that no discharge shall be deemed for
      Cause
      under this paragraph unless Executive first receives written notice from the
      Company (or TPI) advising him of the specific acts or omissions alleged to
      constitute violations of written directions or a material failure to perform
      his
      duties, and such violations or material failure continue after he shall have
      had
      a reasonable opportunity to correct the acts or omissions so complained of;
      or

    

    2.5.6       Executive
      made any material misrepresentation or omission regarding his employment
      history, education or experience in connection with his negotiations to become
      an employee of the Company.

    

    Prior
      to
      any such termination by Company pursuant to paragraphs 2.5.2, 2.5.3, 2.5.4,
      2.5.5 and 2.5.6 hereof, any of which may constitute a basis for termination
      For
      Cause, the Company (or TPI) shall advise Executive in writing within fifteen
      (15) days of the occurrence of any such circumstances constituting the basis
      for
      termination For Cause. For the avoidance of doubt, with respect to any
      paragraphs 2.5.2, 2.5.3, 2.5.4, and 2.5.5, if Company (or TPI) fails to inform
      Executive in writing of the existence of such circumstances forming the basis
      for termination For Cause, as provided herein, the Company (and TPI) shall
      automatically forfeit the right thereafter to categorize such circumstances
      as a
      basis for termination For Cause and terminate Executive’s employment hereunder
      pursuant to Section 4.3.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    

    2.6       “Good
      Reason”
shall
      mean, in the context of a basis for termination by Executive of his employment
      hereunder, without Executive’s consent, (i) modification of Executive’s duties
      inconsistent in any material respect with Executive's position (including titles
      and reporting relationships), authority, duties or responsibilities as
      contemplated by this Agreement, or any other action by the Company (or TPI)
      which results in a significant diminution in such position, authority, duties
      or
      responsibilities; or (ii) any failure by the Company to comply with any of
      the
      material provisions regarding Executive's salary, bonuses, perquisites and
      other
      benefits and amounts payable to Executive under this Agreement.

    

    2.7       “Magic
      Arts”
shall
      mean Magic Arts & Entertainment - Florida, a Florida corporation.

    

    2.8       “Merger
      Agreements”
shall
      mean, collectively, (i) that certain Agreement and Plan of Merger, dated as
      of
      February 29, 2008, by and among Tix Corporation, on the one hand, and Magic
      Arts
& Entertainment - Florida, Inc., Joseph B. Marsh and Lee D. Marshall, on the
      other hand; and (ii) that certain Agreement and Plan of Merger, dated as of
      the
      date of this Agreement, by and between Tix Corporation and NewSpace Acquisition,
      Inc., on the one hand, and NewSpace Entertainment, Inc., John Ballard, Steve
      Boulay and Bruce Granath, on the other hand. 

    

    2.9       “NewSpace”
shall
      mean NewSpace Entertainment, Inc., a Utah corporation. 

    

    2.10       “Person”
shall
      mean an individual or a partnership, corporation, trust, association, limited
      liability company, governmental authority or other entity.

     

    3.       Compensation
      and Benefits

    

    3.1       Base
      Salary.
      The
      Company shall pay to Executive a salary in installments in the same manner
      and
      at the same times the Company pays salaries to other senior officers of the
      Company, but in no event less frequently than equal monthly installments.
      Executive’s initial base salary shall be at an annual rate of $185,000 (the
“Base
      Salary”).
      

    

    3.2       Annual
      Review.
      Executive’s Base Salary shall be reviewed for potential increase by the Company,
      based upon the Executive’s performance, not less often than annually. Any
      positive adjustments in Base Salary effected as a result of such review shall
      be
      made by the Company in its sole discretion; provided,
      however,
      that
      during the Term of this Agreement, the Executive shall receive a minimum
      increase of three percent (3%) per annum

    

    3.3       Expense
      Reimbursement.
      Executive shall be entitled to reimbursement from the Company or TPI for the
      reasonable costs and expenses that Executive incurs in connection with the
      performance of Executive’s duties and obligations under this
      Agreement.

    

    3.4       Benefit
      Plans.
      Executive shall be entitled to participate in any pension, savings and group
      term life, medical, dental, disability and other group benefit plans, which
      the
      Company makes available to its senior officers generally.

    

    3.5       Vacation.
      Executive shall be entitled to four (4) weeks paid vacation each year.

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    

    3.6       Withholding.
      The
      Company may deduct from any compensation payable to Executive (including
      payments made pursuant to Section 3
      of this
      Agreement in connection with or following termination of employment) amounts
      sufficient to cover Executive’s share of applicable federal, state and/or local
      income tax withholding, old-age and survivors’ and other social security
      payments, state disability and other insurance premiums and
      payments

     

    4.       Term
      of Employment

    

    Except
      as
      contemplated in Section 1.2 of this Agreement, Executive’s employment pursuant
      to this Agreement shall commence on the Effective Date and shall terminate
      on
      the earliest to occur of the following:

     

    4.1       upon
      the
      death of Executive;

     

    4.2       upon
      delivery to Executive of written notice of termination by the Company if
      Executive shall suffer a physical or mental disability which renders Executive,
      in the reasonable judgment of the Chief Executive Officer of the Company, unable
      to perform his duties and obligations under this Agreement for either 60
      consecutive days or 120 days in any 12-month period;

     

    4.3       upon
      delivery to Executive of written notice of termination by the Company For
      Cause; 

     

    4.4       upon
      delivery to Executive of written notice of termination by the Company without
      Cause; or 

    

    4.5       upon
      delivery to the Company of written notice of termination by Executive for Good
      Reason; provided,
      however,
      prior
      to any such termination by Executive pursuant to this Section 4.5, Executive
      shall advise the Company in writing within fifteen (15) days of the occurrence
      of any circumstances that would constitute Good Reason, and the Company does
      not
      cure such circumstances within 15 days following receipt of Executive’s written
      notice.
      For the
      avoidance of doubt, with respect to any specific set of circumstances that
      may
      constitute a basis for Good Reason, if Executive fails to inform the Company
      in
      writing, as provided herein, of the existence of such circumstances, Executive
      shall automatically forfeit the right thereafter to categorize such
      circumstances as Good Reason and terminate his employment hereunder pursuant
      to
      this Section 4.5.

     

    5.       Compensation
      and Benefits Following Termination of Employment

    

    5.1       If
      Executive’s employment is terminated pursuant to Section 4.1
      (death),
      Section 4.2
      (disability), or Section 4.3 (by the Company For Cause), Executive shall be
      entitled to salary accrued through the date of termination and no other benefits
      other than as required under the terms of employee benefit plans in which
      Executive was participating as of the date of termination. 

     

    5.2       If
      Executive’s employment is terminated by the Company pursuant to
      Section 4.4
      (without
      Cause) or by Executive pursuant to Section 4.5 (Good Reason), Executive shall
      be
      entitled to continue to receive the salary at the rate in effect upon the date
      of termination of employment for six (6) months following the date of
      termination of employment, payable in accordance with the Company’s normal
      payroll practices and policies, as if Executive’s employment had not
      terminated.
      Executive shall be entitled to no other post-employment benefits except for
      benefits payable under applicable benefit plans in which Executive is entitled
      to participate pursuant to Section 3.3 hereof through the date of termination,
      subject to and in accordance with the terms of such plans

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    

    5.3       As
      a
      condition to Executive’s right to receive any benefits pursuant to Section
5.2
      of this
      Agreement:

    

    5.3.1       Executive
      must execute and deliver to the Company a written release in form and substance
      satisfactory to the Company, of any and all claims against the Company Group
      and
      all directors and officers of the Company Group with respect to all matters
      arising out of Executive’s employment hereunder, or the termination thereof
      (other than claims for entitlements under the terms of this Agreement or plans
      or programs of the Company in which Executive has accrued a benefit);
      and

    

    5.3.2       Executive
      must not breach any of his covenants and agreements under Sections 7 and 8
      of
      this Agreement, which continue following termination of his
      employment.

    

    5.4       In
      the
      event of termination of Executive’s employment pursuant to
      Section 4.3
      (by the
      Company For Cause), and subject to applicable law and regulations, the Company
      shall be entitled offset against any payments due Executive the loss and damage,
      if any, which shall have been suffered by the Company as a result of the acts
      or
      omissions of Executive giving rise to termination under
      Section 4.3.
      The
      foregoing shall not be construed to limit any cause of action, claim or other
      rights, which the Company may have against Executive in connection with such
      acts or omissions.

    

    5.5       Executive
      acknowledges that the Company has the right to terminate Executive’s employment
      without Cause, and both parties hereby agree that such termination shall not
      be
      a breach of this Agreement or any other express or implied agreement between
      the
      Company and Executive. Accordingly, in the event of such termination, each
      of
      the Company and Executive shall be entitled only to those benefits and rights
      specifically provided for in this Agreement in the event of such termination,
      and shall not have any other rights to any compensation or damages for breach
      of
      contract.

    

    6.       Representations
      and Warranties of Executive

    

    Executive
      represents and warrants to the Company that:

    

    6.1       Executive
      has full power and authority to enter into and fully perform this Agreement,
      and
      this Agreement does not conflict with or violate any other agreement,
      obligation, order or other restriction to which Executive is
      subject.

    

    6.2       Executive
      is not a party to any litigation, nor is aware of any threatened action,
      proceeding or litigation which (a) could in any way involve the Company or
      (b) will result in Executive’s inability to perform his obligations
      hereunder, including any action which could be reasonably foreseen to require
      a
      significant amount of Executive’s time.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    6.3       This
      Agreement has been duly executed by Executive and constitutes a binding and
      valid obligation of Executive, enforceable in accordance with its
      terms.

    

    6.4       Executive
      has
      fully
      disclosed in writing any debarment, suspension or material sanctions imposed
      within the last ten years by any federal or state governmental agency or
      instrumentality or government-sponsored enterprise on either Executive
      or
      any
      company for which Executive
      was
      a
      senior officer with respect to operations under Executive
      supervision.

    

    6.5       Executive
      has
      completely and accurately disclosed to the Company, pursuant to Exhibit
      A
      attached
      hereto, all legal proceedings, orders, bankruptcies, and judgments, which
Executive
      has
      been
      the subject of, during the past five years.

     

    7.       Covenant
      Not To Solicit;
      Non-Compete

    

    If
      Executive’s employment is terminated by the Company pursuant to Section 4.3 (for
      Cause) or this Agreement expires upon its terms, then during the period from
      the
      date on which Executive’s employment with the Company is terminated through the
      fifth anniversary of such date, except pursuant to the prior written consent
      of
      the Chief Executive Officer of the Company, Executive shall not, directly or
      indirectly, either as employer, consultant, advisor, agent, investor, principal,
      partner, stockholder (except as the holder of less than 1% of the issued and
      outstanding stock of a publicly held corporation), or in any other individual
      or
      representative capacity, (i) engage or participate in the production or
      promotion of any show or event presently owned or produced by the Company or
      TPI
      (including, without limitation, all shows and events acquired by the Company
      pursuant to the Merger Agreements), or hereafter owned, acquired, or produced
      by
      the Company or TPI during Executive’s employment pursuant to this Agreement (all
      such shows and events, the “Non-Compete
      Events”);
      and
      (ii) engage or participate in the exhibition, presentation or promotion of
      the
      Non-Compete Events in Akron, Boise, Kalamazoo, Salt Lake City, Eugene, Fresno
      and Albuquerque, or any other markets in which the Company or TPI exhibits,
      presents or promotes the Non-Compete Events during Executive’s employment
      pursuant to this Agreement.

     

    8.       Confidentiality

    

    Executive
      agrees not to disclose or use at any time (whether during or after Executive’s
      employment with the Company) for Executive’s own benefit or purposes or the
      benefit or purposes of any other Person any information, data, trade secrets
      and
      confidential or proprietary information relating to the business, operations,
      assets and liabilities of the Company Group, including without limitation all
      customers and/or suppliers’ identities, characteristics and agreements,
      financial information and projections, employee files, business and marketing
      plans, sales activities, pricing methodologies, credit and financial data and
      financial methods (the “Confidential
      Material”);
      provided,
      however,
      that
      the foregoing shall not apply to information which is not unique to the Company
      Group or which is generally known to the industry or the public other than
      as a
      result of Executive’s breach of this covenant. Executive agrees that upon
      termination of his employment with the Company for any reason, he will return
      to
      the Company immediately all memoranda, books, papers, plans, information,
      letters and other data, and all copies thereof or therefrom, in any way relating
      to the business of the Company Group, except that he may retain personal notes,
      notebooks, diaries, rolodexes and addresses and phone numbers. Executive further
      agrees that he will not retain or use for his account at any time any trade
      names, trademark or other proprietary business designation used or owned in
      connection with the business of any member of the Company Group.

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    

    9.       Specific
      Performance.
      Executive acknowledges and agrees that the Company’s remedies at law for a
      breach or threatened breach of any of the provisions of Sections 1.4,
7
      or
8
      hereof
      would be inadequate and, in recognition of this fact, Executive agrees that,
      in
      the event of such a breach or threatened breach, in addition to any remedies
      at
      law, the Company, without posting any bond, shall be entitled to obtain
      equitable relief in the form of specific performance, temporary restraining
      order, temporary or permanent injunction or any other equitable remedy which
      may
      then be available.

    

    10.       Arbitration
      of Disputes

     

    10.1       Except
      as
      set forth in Section 10.2
      below,
      any controversy or claim between the Company and Executive relating to
      Executive’s employment with the Company, including but not limited to those
      arising out of or relating to this Agreement and those involving conduct alleged
      to be in violation of local, state or federal statutory or common law
      (including, but not limited to, any claim of unlawful discrimination,
      harassment, retaliation, breach of fiduciary duty, misappropriation of trade
      secrets and unfair competition), shall be settled by final and binding
      arbitration. The arbitration shall be conducted in accordance with the National
      Rules for the Resolution of Employment Disputes of the American Arbitration
      Association (“AAA”),
      and a
      judgment upon any award rendered by the arbitrator may be entered in any court
      having jurisdiction. The arbitration shall be heard in Los Angeles, California.
      California Code of Civil Procedure Section 1283.05, which provides for certain
      discovery rights, shall apply to any arbitration. The arbitrator shall apply,
      as
      applicable, federal or California substantive law and law of remedies. The
      arbitrator’s remedial authority shall be no greater than that which is available
      under the statutory or common law theory asserted. The Company shall bear the
      cost of the arbitrator’s fees and other costs (which do not include attorneys’
fees) unique to arbitration in compliance with applicable law.

     

    10.2       Subsection 10.1
      above
      does not apply to or cover the following claims: (a) claims for workers’
compensation benefits; (b) claims for unemployment compensation benefits; (c)
      claims brought in court to compel arbitration under this Agreement, to enforce
      an arbitration award or to obtain preliminary injunctive and/or other equitable
      relief in support of claims to be prosecuted in an arbitration by either party;
      and (d) claims based upon a pension or benefit plan which contains an
      arbitration or other dispute resolution procedure, in which case the provisions
      of such plan shall apply.

    

    11.       Miscellaneous

     

    11.1       Notices.
      All
      notices, requests, demands and other communications (collectively, “Notices”)
      given
      pursuant to this Agreement shall be in writing, and shall be delivered by
      personal service, courier, facsimile transmission or by United States first
      class, registered or certified mail, addressed to the following
      addresses:

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    

      
        	
                11.1.1

              	
                If
                  to the Company, to:

              
	 	
                12001
                  Ventura Place, Suite 340

              
	 	
                Studio
                  City, CA 91604

              
	 	
                Tel:
                  (818) 761-1002

              
	 	
                Fax:
                  (818) 761-1072

              
	 	
                Attn:
                  Mitch Francis

              
	 	 
	 	
                with
                  a copy, which shall not constitute notice to:

              
	 	 
	 	
                Troy
                  & Gould

              
	 	
                1801
                  Century Park East, Suite 1600

              
	 	
                Los
                  Angeles, CA 90067

              
	 	
                Attention:
                  David Ficksman

              
	 	
                Tel:
                  (310) 553-4441

              
	 	
                Fax:
                  (310) 201-4746

              
	 	 
	
                11.1.2

              	
                If
                  to Executive, to:

              
	 	 
	 	
                to
                  Executive’s address as set forth on the books and records of the Company
                  

              
	 	 
	 	
                with
                  a copy, which shall not constitute notice to:

              
	 	 
	 	
                Holland
                  & Hart LLP

              
	 	
                Attn:
                  Gregory Lindley

              
	 	
                60
                  E. South Temple, Suite 2000

              
	 	
                Salt
                  Lake City, UT 84111

              

      

    Any
      Notice, other than a Notice sent by registered or certified mail, shall be
      effective when received; a Notice sent by registered or certified mail, postage
      prepaid return receipt requested, shall be effective on the earlier of when
      received or the third day following deposit in the United States mails (or
      on
      the seventh day if sent to or from an address outside the United States). Any
      party may from time to time change its address for further Notices hereunder
      by
      giving notice to the other party in the manner prescribed in this
      Section.

     

    11.2       Entire
      Agreement.
      This
      Agreement contains the sole and entire agreement and understanding of the
      parties with respect to the entire subject matter of this Agreement, and any
      and
      all prior discussions, negotiations, commitments and understandings, whether
      oral or otherwise. No representations, oral or otherwise, express or implied,
      other than those contained in this Agreement have been relied upon by any party
      to this Agreement. Notwithstanding the foregoing, Executive acknowledges that
      the Company has relied on his resume and other documents which may have been
      provided by Executive, and oral statements regarding Executive’s employment
      history, education and experience, in determining to enter into the Agreement,
      and material misrepresentations (or omissions) in connection with such documents
      may constitute the basis of termination For Cause, as contemplated by the
      definition of For Cause.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    

    11.3       Severability.
      In the
      event that any provision or portion of this Agreement shall be determined to
      be
      invalid or unenforceable for any reason, in whole or in part, the remaining
      provisions of this Agreement shall be unaffected thereby and shall remain in
      full force and effect to the fullest extent permitted by law.

    

    11.4       Governing
      Law.
      This
      Agreement shall be construed in accordance with the laws of the State of
      California without giving effect to the principles of conflicts of law
      thereof.

    

    11.5       Captions.
      The
      various captions of this Agreement are for reference only and shall not be
      considered or referred to in resolving questions of interpretation of this
      Agreement.

    

    11.6       Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which shall
      be
      deemed to be an original, but all of which together shall constitute one and
      the
      same instrument.

    

    11.7       Business
      Day.
      If the
      last day permissible for delivery of any notice under any provision of this
      Agreement, or for the performance of any obligation under this Agreement, shall
      be other than a business day, such last day for such notice or performance
      shall
      be extended to the next following business day (provided, however, under no
      circumstances shall this provision be construed to extend the date of
      termination of this Agreement).

    

    11.8       Attorneys’
      Fees.
      In any
      arbitration proceeding or court action relating to this Agreement or Executive’s
      employment with the Company, the prevailing party shall be entitled to recover
      its reasonable attorneys’ fees and costs. 

    

    11.9       Advice
      from Independent Counsel.
      The
      parties hereto understand that this Agreement is legally binding and may affect
      such party’s rights. Each party represents to the other that it has received
      legal advice from counsel of its choice regarding the meaning and legal
      significance of this Agreement to which it is a party and that it is satisfied
      with its legal counsel and the advice received from it.

    

    11.10       Judicial
      Interpretation.
      Should
      any provision of this Agreement require judicial interpretation, it is agreed
      that a court interpreting or construing the same shall not apply a presumption
      that the terms hereof shall be more strictly construed against any Person by
      reason of the rule of construction that a document is to be construed more
      strictly against the Person who itself or through its agent prepared the same,
      it being agreed that all Parties have participated in the preparation of this
      Agreement.

    

    11.11       Waiver
      of Jury Trial.
      IF
      NOTWITHSTANDING THE AGREEMENT THAT ALL DISPUTES BE SUBMITTED TO BINDING
      ARBITRATION, A DISPUTE IS SUBMITTED TO A COURT, EACH PARTY HERETO WAIVES THE
      RIGHT TO A TRIAL BY JURY IN ANY DISPUTE IN CONNECTION WITH OR RELATING TO THIS
      AGREEMENT, ANY RELATED AGREEMENT OR ANY MATTERS DESCRIBED OR CONTEMPLATED HEREIN
      OR THEREIN, AND AGREE TO TAKE ANY AND ALL ACTION NECESSARY OR APPROPRIATE TO
      EFFECT SUCH WAIVER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED
      AS
      WRITTEN CONSENT TO A TRIAL BY THE COURT.

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    

    11.12       Section
      409A.
      Notwithstanding the timing of payments set forth in this Agreement, if the
      Company determines that Executive is a “specified employee” within the meaning
      of Section 409A of the Internal Revenue Code of 1986, as amended, and that,
      as a
      result of such status, any portion of the payment under this Agreement would
      be
      subject to additional taxation, the Company will delay paying any portion of
      such payment until the earliest permissible date on which payments may commence
      without triggering such additional taxation (with such delay not to exceed
      six
      months), with the first such payment to include the amounts that would have
      been
      paid earlier but for the above delay.

    

    IN
      WITNESS WHEREOF, this Agreement has been made and entered into as of the date
      and year first above written.

    

    
      	 	TIX CORPORATION, 
	 	a Delaware corporation
	 	 	 
	 	By:	 
	 	Title:	 
	 	 	 
	 	 	 
	 	EXECUTIVE
	 	 	 
	 	 
	 	John
              Ballard
	 	 	 

    

     

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
      A

    

    Legal
      Proceedings

     

    Executive
      hereby represents and warrants to the Company that (i) there has not been any
      bankruptcy petition filed by or against any business of which Executive was
      a
      general partner or executive officer at the time of bankruptcy or within two
      years prior thereto; (ii) Executive has not been convicted in a criminal
      proceeding or been the subject of a pending criminal proceeding (excluding
      traffic violations and other minor traffic offenses); and (iii) Executive has
      not been the subject of any order, judgment or decree, not subsequently
      reversed, suspended or vacated, of any court of competent jurisdiction,
      permanently or temporarily enjoining, barring, suspending or otherwise limiting
      Executive’s involvement in any type of business, securities or banking
      activities; Executive has not been found by a court of competent jurisdiction
      in
      a civil action, by the Securities and Exchange Commission or the Commodity
      Futures Trading Commission to have violated a federal or state securities or
      commodities laws, where such judgment has not been reversed, suspended or
      vacated.

     

     

     

     

     

     

     

     

     

     

    
      
        
        

      

      
        -12-

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