Document:

Unassociated Document

    Israel
      Technology Acquisition Corp.

    7
      Gush Etzion, 3rd Floor

    Givaat
      Shmuel

    Israel
      54030

    

    To:

    Gemini
      Israel Funds

    9
      Hamenofim Street

    Herzliya
      Pituach 46725

    Israel

    

    Landa
      Ventures Ltd.

    7
      Menachem Begin St.

    Ramat
      Gan
      52521

    Israel

    

    

    December
      21, 2006

    

    CERTIFICATION

    

    1.  In
      furtherance and in addition to the Certification date June 19, 2006 (the
      "Prior
      Certification")
      provided to you by the undersigned in connection with that certain Letter
      Agreement of even date therewith by and among you, IXI Mobile, Inc.
      ("IXI
      US"),
      a
      Delaware corporation and IXI Mobile (R&D) Ltd. (“IXI
      Israel”),
      an
      Israeli company and a wholly owned subsidiary of IXI US (the "Letter
      Agreement")
      and
      that certain Loan Agreement of even date therewith by and among you, IXI US
      and
      IXI Israel (the "Loan
      Agreement"),
      the
      undersigned hereby certifies that its Board of Directors (including any required
      committee or subgroup of its Board of Directors) has, as of the date of this
      Certification, unanimously granted its approval to IXI US and to IXI Israel
      to
      enter into an Amendment to the Letter Agreement in the form attached hereto
      as
Exhibit
      A
      (the
      "Letter
      Agreement Amendment")
      and to
      enter into an Amendment to the Loan Agreement in the form attached hereto as
      Exhibit
      B
      (the
      "Loan
      Agreement Amendment")
      and
      has further unanimously approved the execution by ITAC of this
      Certification.

    

    2.  Subject
      to and conditioned upon the consummation of the ITAC/IXI Merger, ITAC hereby
      certifies and agrees that its certification and agreement in the Prior
      Certification to assume all of IXI US' and IXI Israel’s obligations, agreements,
      undertakings, representations and warranties pursuant to the combined provisions
      of the Letter Agreement and the Loan Agreement, as more specifically described
      in the Prior Certification, will apply to all such, agreements, undertakings,
      representations and warranties pursuant to the combined provisions of the Letter
      Agreement and the Loan Agreement in their amended terms as set forth in the
      combined provisions of the Letter Agreement Amendment and of the Loan Agreement
      Amendment. 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    3.  For
      and
      in consideration of ITAC providing the foregoing Certification to you, by
      accepting this Certification, each one of you, severally and not jointly, hereby
      agrees that its waiver of any Claims in or to any monies in the Trust Fund
      (as
      such terms are defined in the Prior Certification) as more fully set forth
      in
      the Prior Certification continues in full force and effect.

    

    4.  The
      undersigned, and, by accepting this Certification, each one of you, severally
      and not jointly, having adverse interests as a result of arms’ length
      bargaining, hereby agree that (i) neither Gemini, Landa nor any of their
      respective partners have rendered or agreed to render any services to ITAC
      in
      connection with the Letter Agreement and/or the Letter Agreement Amendment;
      (ii)
      the ITAC Stock and the ITAC Warrants are not being issued as compensation;
      and
      (iii) upon issuance, the ITAC Stock and the ITAC Warrants shall be deemed to
      have prices as if they were issued apart from the Guaranty (as defined in the
      Letter Agreement).

    

    5.  Capitalized
      terms not otherwise defined herein shall have the meanings assigned them in
      the
      Loan Agreement.

    

    6.  This
      Certification is provided as an inducement to you to enter into the Letter
      Agreement Amendment.

    

    7.  This
      Certification shall be governed by and construed in accordance with the laws
      of
      Delaware without regard to the conflicts of laws provisions
      thereof.

    

    

    

    

    

    [Signature
      Pages Follow]

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    ISRAEL
      TECHNOLOGY ACQUISITION CORP.

    

    

     

     

    
      	
              By:    
                

            	/s/
              Israel Frieder
	 	Name:
              Israel Frieder
	 	Title:
              Chairman and Chief Executive Officer

    

    

     

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    [Signature
      Page to ITAC Certification to First Amendment to the IXI-G/L Letter
      Agreement]

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Accepted
      as of the date hereof:

    

    GEMINI
      ISRAEL III LIMITED PARTNERSHIP,

    by
      its
      general partner Gemini Capital Associates III L.P.,

    by
      its
      general partner Gemini Israel Funds Ltd.

    

    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner          
       
       
       
            

     

    GEMINI
      ISRAEL III PARALLEL FUND LIMITED PARTNERSHIP,

    by
      its
      general partner Gemini Capital Associates III, L.P.

    by
      its
      general partner Gemini Israel Funds Ltd.

    

    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner          
       
       
       
       
       

     

    GEMINI
      ISRAEL III OVERFLOW FUND LIMITED PARTNERSHIP,

    by
      its
      general partner Gemini Capital Associates III L.P.,

    by
      its
      general partner Gemini Israel Funds Ltd.

    

    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner

    

    GEMINI
      PARTNER INVESTORS LIMITED PARTNERSHIP.

    by
      its
      general partner Gemini Israel Funds Ltd.

    

    By:
      /s/
      David Cohen /s/ Yosi Sela

    Name:
      David Cohen Yosi Sela

    Title:
      CFO, GP Managing Partner

    

    

    

    [Signature
      Page to ITAC Certification to First Amendment to the IXI-G/L Letter
      Agreement]

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

    

      
        	 	
                LANDA
                  VENTURES LTD.

              
	 	 	 
	 	
                By:
                  

              	/s/

	 	 	 
	 	
                Name:

              	
                 

              
	 	 	 
	 	
                Title:

              	 

      

    

    

    

    

    

    

    

    [Signature
      Page to ITAC Certification to First Amendment to the IXI-G/L Letter
      Agreement]Exhibit
      10.1

    

    

    EMPLOYMENT
      AGREEMENT EXTENSION

    

    Reference
      is made to the Employment Agreement (the “Agreement”), dated as of January 8,
      2004, by and between Zylogen, Inc., a Delaware corporation and the predecessor
      to ZIOPHARM Oncology, Inc., a Delaware corporation (the “Company”), and Dr.
      Jonathan Lewis (the “Executive”). All terms used, but not otherwise defined
      herein, shall have the meanings assigned to them in the Agreement.

    

    Each
      of
      the Board, the Company and the Executive hereby consent and agree as
      follows:

    

    1.
       Pursuant
      to Section 2 of the Agreement, the Term is extended for an additional one (1)
      year period.

    

    2.
       Section
      5(a) of the Agreement is hereby amended by restating the first sentence in
      its
      entirety, as follows: “The Company shall pay Executive a salary (the “Base
      Salary”) equal to Three Hundred Eighty-Five Thousand Dollars ($385,000) per
      year.

    

      Except
      for the extension of the Term and the amendment to Section 5(a) of the Agreement
      provided above, the terms and conditions of the Agreement remain applicable
      in
      their entirety.

    

    IN
      WITNESS WHEREOF, the Company and the Board have caused their respective duly
      authorized officer and representative to execute and the Executive has
      personally set his hand hereto as of the date set forth below.

    

     

    
      	 	 	 
	 	
              ZIOPHARM
                Oncology,
                Inc. and

              Its
                Board of Directors

            
	 
 	 
 	 
 
	 	By:  	/s/ Richard
              Bagley
	 	
              
Name: Richard
              Bagley
	 	Title: President

 

    

    
      	 	 	 
	 	EXECUTIVE
	 
 	 
 	 
 
	 	By:  	/s/ Jonathan
              Lewis
	 	
              
Name: Jonathan
              Lewis, M.D.
	Date: 21
              December, 2006SUBSCRIPTION AGREEMENT

            SUBSCRIPTION  AGREEMENT (this  "Agreement") made as of the last date
set forth on the signature  page hereof  between  National  Investment  Managers
Inc.,  a  Florida   corporation  (the  "Company"),   and  the  undersigned  (the
"Subscriber").

                              W I T N E S S E T H:

            WHEREAS,   the  Company  is  conducting  a  private   offering  (the
"Offering") for which  Westminster  Securities Corp. (the "Placement  Agent") is
acting as  placement  agent,  consisting  of a minimum of 10,000  (the  "Minimum
Offering")  up to a maximum  of 60,000  (the  "Maximum  Offering")  shares  (the
"Shares")  of  Series  E  Cumulative  Convertible  Preferred  Stock  ("Series  E
Preferred  Stock"),  pursuant to Section 4(2) of the  Securities Act of 1933, as
amended (the "Securities Act") and Rule 506 promulgated thereunder; and

            WHEREAS,  the  Subscriber  desires to purchase that number of Shares
set forth on the signature page hereof on the terms and  conditions  hereinafter
set forth; and

            WHEREAS, for each Share of Series E Preferred Stock purchased,  each
Subscriber will receive a warrant to purchase one hundred (100) shares of common
stock (the "Common Stock") of the Company (the "Warrants", and collectively with
the Series E Preferred Stock, the "Securities").

            NOW,  THEREFORE,  in  consideration  of the  premises and the mutual
representations  and  covenants  hereinafter  set forth,  the parties  hereto do
hereby agree as follows:

I. SUBSCRIPTION FOR SHARES AND REPRESENTATIONS BY SUBSCRIBER

            1.1 Subject to the terms and conditions hereinafter set forth and in
the Confidential  Offering  Memorandum dated November 30, 2006 (such memorandum,
together with all amendments  thereof and supplements and exhibits thereto,  the
"Memorandum"),  the Subscriber hereby  irrevocably  subscribes for and agrees to
purchase  from the Company,  and the Company  agrees to sell to the  Subscriber,
such number of Shares as is set forth on the  signature  page  hereof,  at a per
share price equal to $100.00 per Share.  The  purchase  price is payable by wire
transfer, to be held in escrow until the Minimum Offering is achieved, to:

                              Receiving Bank: XXXXX
                              ABA #           XXXXX
                              For the Credit: XXXXX
                              ABA #           XXXXX
                              Address:        XXXXX
                              Account Name:   XXXXX
                              Account #       XXXXX
                              Swift Code      XXXXX
<PAGE>

            1.2 Offering  Period;  Maximum.  The Securities  will be offered for
sale until December 15, 2006, (the "Termination Date"),  subject to the right of
the Company and the Placement Agent to extend the Termination  Date for up to 45
additional days. The Offering is being conducted on a best-efforts basis.

            1.3  Closings.  The  Company may hold an initial  closing  ("Initial
Closing")  at any time  after the  receipt  of  accepted  subscriptions  for the
Minimum  Offering  prior to the  Termination  Date.  After the Initial  Closing,
subsequent closings with respect to additional  Securities may take place at any
time prior to the Termination Date as determined by the Company, with respect to
subscriptions  accepted  prior  to the  Termination  Date  (each  such  closing,
together with the Initial Closing,  being referred to as a "Closing").  The last
Closing of the Offering, occurring on or prior to the Termination Date, shall be
referred to as the "Final Closing". Any subscription documents or funds received
after the Final Closing will be returned, without interest or deduction.

            1.4 The  Subscriber  recognizes  that the purchase of the Securities
involves a high degree of risk including, but not limited to, the following: (a)
the Company has limited  operating  history and  requires  substantial  funds in
addition to the proceeds of the  Offering;  (b) an  investment in the Company is
highly  speculative,  and only investors who can afford the loss of their entire
investment should consider investing in the Company and the Securities;  (c) the
Subscriber may not be able to liquidate its investment;  (d)  transferability of
the  Securities is extremely  limited;  (e) in the event of a  disposition,  the
Subscriber could sustain the loss of its entire investment;  (f) the Company has
not paid any dividends  since its inception and does not  anticipate  paying any
dividends;  and (g) the Company may issue  additional  securities  in the future
which  have  rights  and  preferences  that are  senior to those of the Series E
Preferred  Stock.  Without  limiting the generality of the  representations  set
forth in Section 1.5 below,  the Subscriber  represents  that the Subscriber has
carefully reviewed the section of the Memorandum captioned "Risk Factors."

            1.5 The Subscriber  represents that the Subscriber is an "accredited
investor" as such term is defined in Rule 501 of Regulation D  ("Regulation  D")
promulgated under the Securities Act, as indicated by the Subscriber's responses
to the  questions  contained in Article VII hereof,  and that the  Subscriber is
able to bear the economic risk of an investment in the Securities.

            1.6 The Subscriber  hereby  acknowledges and represents that (a) the
Subscriber has knowledge and experience in business and financial matters, prior
investment  experience,  including investment in securities that are non-listed,
unregistered  and/or  not traded on a national  securities  exchange  nor on the
National  Association  of  Securities  Dealers,   Inc.  (the  "NASD")  automated
quotation  system  ("NASDAQ"),  or the Subscriber has employed the services of a
"purchaser  representative"  (as defined in Rule 501 of Regulation D),  attorney
and/or  accountant to read all of the documents  furnished or made  available by
the Company both to the Subscriber and to all other prospective investors in the
Securities  to  evaluate  the  merits  and  risks of such an  investment  on the
Subscriber's behalf; (b) the Subscriber recognizes the highly speculative nature
of this  investment;  and (c) the  Subscriber  is able to bear the economic risk
that the Subscriber hereby assumes.

                                       2
<PAGE>

            1.7 The Subscriber hereby acknowledges receipt and careful review of
this Agreement, the Memorandum (which includes the Risk Factors),  including the
Warrant and the Series E Certificate of  Designation  (as defined below) and all
other  exhibits  thereto,  and any documents  which may have been made available
upon request as reflected  therein  (collectively  referred to as the  "Offering
Materials") and hereby  represents that the Subscriber has been furnished by the
Company  during the course of the Offering  with all  information  regarding the
Company, the terms and conditions of the Offering and any additional information
that the  Subscriber has requested or desired to know, and has been afforded the
opportunity  to ask  questions  of and  receive  answers  from  duly  authorized
officers or other  representatives of the Company concerning the Company and the
terms and conditions of the Offering.

            1.8 (a) In making  the  decision  to invest  in the  Securities  the
Subscriber has relied solely upon the information provided by the Company in the
Offering Materials. To the extent necessary, the Subscriber has retained, at its
own expense,  and relied upon  appropriate  professional  advice  regarding  the
investment,  tax and legal merits and  consequences  of this  Agreement  and the
purchase of the Securities  hereunder.  The Subscriber disclaims reliance on any
statements made or information provided by any person or entity in the course of
Subscriber's  consideration  of an investment in the  Securities  other than the
Offering Materials.

                  (b) The  Subscriber  represents  that (i) the  Subscriber  was
contacted  regarding the sale of the Securities by the Company (or an authorized
agent  or  representative   thereof)  with  whom  the  Subscriber  had  a  prior
substantial  pre-existing  relationship  and (ii) no Securities  were offered or
sold to it by means of any form of general  solicitation or general advertising,
and in connection  therewith,  the  Subscriber did not (A) receive or review any
advertisement,  article,  notice or other communication published in a newspaper
or magazine or similar  media or broadcast  over  television  or radio,  whether
closed  circuit,  or generally  available;  or (B) attend any seminar meeting or
industry  investor  conference  whose  attendees  were  invited  by any  general
solicitation or general advertising.

            1.9 The Subscriber hereby represents that the Subscriber,  either by
reason of the Subscriber's  business or financial  experience or the business or
financial  experience  of  the  Subscriber's   professional  advisors  (who  are
unaffiliated with and not compensated by the Company or any affiliate or selling
agent of the Company,  directly or indirectly),  has the capacity to protect the
Subscriber's  own  interests in  connection  with the  transaction  contemplated
hereby.

            1.10 The Subscriber  hereby  acknowledges  that the Offering has not
been  reviewed by the United  States  Securities  and Exchange  Commission  (the
"SEC") nor any state  regulatory  authority since the Offering is intended to be
exempt from the  registration  requirements  of Section 5 of the Securities Act,
pursuant to Regulation D. The Subscriber  understands  that the Securities  have
not been  registered  under the Securities Act or under any state  securities or
"blue sky" laws and agrees not to sell, pledge,  assign or otherwise transfer or
dispose of the Securities  unless they are  registered  under the Securities Act
and  under  any  applicable  state  securities  or "blue  sky" laws or unless an
exemption from such registration is available.

                                       3
<PAGE>

            1.11 The Subscriber  understands  that the Securities  have not been
registered  under the Securities Act by reason of a claimed  exemption under the
provisions of the Securities Act that depends,  in part,  upon the  Subscriber's
investment intention. In this connection,  the Subscriber hereby represents that
the Subscriber is purchasing the Securities for the Subscriber's own account for
investment and not with a view toward the resale or distribution to others.  The
Subscriber,  if an  entity,  further  represents  that it was not formed for the
purpose of purchasing the Securities.

            1.12 The Subscriber  understands that the Common Stock issuable upon
conversion of the Series E Preferred  Stock (the  "Conversion  Shares") and upon
exercise  of the  Warrants  (the  "Warrant  Shares"  and  collectively  with the
Conversion  Shares, the "Common Shares") is quoted on the OTC Bulletin Board and
that there is a limited market for the Common Stock. The Subscriber  understands
that even if a public  market  develops for the Common  Shares,  Rule 144 ("Rule
144")  promulgated under the Securities Act requires for  non-affiliates,  among
other  conditions,  a one-year  holding  period  prior to the resale (in limited
amounts) of  securities  acquired in a  non-public  offering  without  having to
satisfy the registration  requirements  under the Securities Act. The Subscriber
understands and hereby  acknowledges  that the Company is under no obligation to
register any of the  Securities or the Common Shares under the Securities Act or
any state securities or "blue sky" laws other than as set forth in Article V.

            1.13 The  Subscriber  consents to the  placement  of a legend on any
certificate  or other  document  evidencing the Securities and the Common Shares
that such securities  have not been  registered  under the Securities Act or any
state  securities  or "blue  sky" laws and  setting  forth or  referring  to the
restrictions on  transferability  and sale thereof  contained in this Agreement.
The Subscriber is aware that the Company will make a notation in its appropriate
records  with  respect  to the  restrictions  on  the  transferability  of  such
Securities.  The  legend  to be  placed  on each  certificate  shall  be in form
substantially similar to the following:

            "THE SECURITIES  REPRESENTED  HEREBY HAVE NOT BEEN REGISTERED  UNDER
            THE UNITED STATES  SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR
            ANY STATE  SECURITIES  OR "BLUE SKY LAWS,"  AND MAY NOT BE  OFFERED,
            SOLD,  TRANSFERRED,  ASSIGNED,  PLEDGED  OR  HYPOTHECATED  ABSENT AN
            EFFECTIVE  REGISTRATION  THEREOF UNDER SUCH ACT OR  COMPLIANCE  WITH
            RULE 144  PROMULGATED  UNDER  SUCH ACT,  OR UNLESS THE  COMPANY  HAS
            RECEIVED  AN  OPINION OF  COUNSEL,  REASONABLY  SATISFACTORY  TO THE
            COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED."

            1.14 It is agreed that the Company, at its sole discretion, reserves
the unrestricted right,  without further  documentation or agreement on the part
of the Subscriber, to reject or limit any subscription,  to accept subscriptions
for  fractional  Shares and to close the Offering to the  Subscriber at any time
and that the Company will issue stop transfer instructions to its transfer agent
with respect to such Securities.

            1.15  The  Subscriber  hereby  represents  that the  address  of the
Subscriber  furnished  by  Subscriber  on  the  signature  page  hereof  is  the
Subscriber's principal residence if Subscriber is an individual or its principal
business address if it is a corporation or other entity.

                                       4
<PAGE>

            1.16 The  Subscriber  represents  that the Subscriber has full power
and authority  (corporate,  statutory and otherwise) to execute and deliver this
Agreement and to purchase the Securities.  This Agreement constitutes the legal,
valid  and  binding  obligation  of  the  Subscriber,  enforceable  against  the
Subscriber in accordance with its terms.

            1.17  If  the  Subscriber  is a  corporation,  partnership,  limited
liability company,  trust, employee benefit plan, individual retirement account,
Keogh Plan, or other tax-exempt entity, it is authorized and qualified to invest
in the Company and the person  signing  this  Agreement on behalf of such entity
has been duly authorized by such entity to do so.

            1.18 The Subscriber  acknowledges  that if he or she is a Registered
Representative  of an NASD member firm, he or she must give such firm the notice
required  by the  NASD's  Rules  of Fair  Practice,  receipt  of  which  must be
acknowledged by such firm in Section 7.4 below.

            1.19 The Subscriber  acknowledges that at such time, if ever, as the
Securities  or the  Common  Shares  are  registered  (as such term is defined in
Article V hereof), sales of the Securities and the Common Shares will be subject
to state securities laws.

            1.20 The  Subscriber  agrees not to issue any public  statement with
respect to the Subscriber's  investment or proposed investment in the Company or
the terms of any agreement or covenant  between them and the Company without the
Company's  prior written  consent,  except such  disclosures  as may be required
under applicable law or under any applicable order, rule or regulation.

            1.21 The  Subscriber  agrees to hold the Company and its  directors,
officers,  employees,  affiliates,  controlling  persons  and  agents  and their
respective  heirs,  representatives,  successors  and  assigns  harmless  and to
indemnify them against all liabilities, costs and expenses incurred by them as a
result of (a) any sale or  distribution  of the  Securities by the Subscriber in
violation of the Securities Act or any applicable state securities or "blue sky"
laws;  or (b) any false  representation  or warranty or any breach or failure by
the  Subscriber  to comply  with any  covenant  made by the  Subscriber  in this
Agreement  (including  the  Confidential  Investor  Questionnaire  contained  in
Article VII herein) or any other document  furnished by the Subscriber to any of
the foregoing in connection with this Agreement.

II. REPRESENTATIONS BY AND COVENANTS OF THE COMPANY

            The Company hereby represents and warrants to the Subscriber that:

            2.1 Organization, Good Standing and Qualification.  The Company is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Florida and has full  corporate  power and  authority to own and
use its  properties  and its  assets  and  conduct  its  business  as  currently
conducted.  Each of the Company's subsidiaries (the "Subsidiaries") is an entity

                                       5
<PAGE>

duly  organized,  validly  existing and in good  standing  under the laws of the
jurisdiction  of its  incorporation  with  the  requisite  corporate  power  and
authority to own and use its  properties  and assets and to conduct its business
as currently  conducted.  Neither the Company, nor any of its Subsidiaries is in
violation  of  any  of  the   provisions   of  their   respective   articles  of
incorporation,  by-laws or other organizational or charter documents, including,
but not limited to the Charter Documents (as defined below). Each of the Company
and its  Subsidiaries  is duly  qualified  to  conduct  business  and is in good
standing as a foreign  corporation in each  jurisdiction  in which the nature of
the  business  conducted  or  property  owned  by it  makes  such  qualification
necessary,  except where the failure to be so qualified or in good standing,  as
the case may be,  would not  result in a direct  and/or  indirect  (i)  material
adverse  effect  on  the  legality,  validity  or  enforceability  of any of the
Securities and/or this Agreement, (ii) material adverse effect on the results of
operations,  assets,  business  or  financial  condition  of the  Company or its
Subsidiaries,  or (iii)  material  adverse  effect on the  Company's  ability to
perform in any  material  respect on a timely basis its  obligations  under this
Agreement,  the Warrants,  the  Certificate of  Designation of the  Preferences,
Rights and  Limitations of Series E Convertible  Preferred  Stock (the "Series E
Certificate of Designation") and the Memorandum.

            2.2  Capitalization  and Voting Rights.  The authorized,  issued and
outstanding  capital stock of the Company is as set forth in Schedule 2.2 hereto
and all  issued  and  outstanding  shares of capital  stock of the  Company  are
validly issued,  fully paid and  nonassessable.  Except as set forth in Schedule
2.2 hereto, (i) there are no outstanding securities of the Company or any of its
Subsidiaries which contain any preemptive, redemption or similar provisions, nor
is any  holder of  securities  of the  Company  or any  Subsidiary  entitled  to
preemptive or similar rights arising out of any agreement or understanding  with
the Company or any Subsidiary by virtue of any of the Transaction Documents, and
there are no contracts, commitments, understandings or arrangements by which the
Company or any of its  Subsidiaries  is or may become bound to redeem a security
of the Company or any of its  Subsidiaries;  (ii) the Company  does not have any
stock appreciation  rights or "phantom stock" plans or agreements or any similar
plan or  agreement;  and  (iii)  there  are no  outstanding  options,  warrants,
agreements,  convertible  securities,  preemptive  rights  or  other  rights  to
subscribe  for or to  purchase or  acquire,  any shares of capital  stock of the
Company or contracts, commitments,  understandings, or arrangements by which the
Company or any  Subsidiary is or may become bound to issue any shares of capital
stock of the Company,  or securities or rights  convertible or exchangeable into
shares of capital stock of the Company.  Except as set forth in Schedule 2.2 and
as  otherwise  required  by law,  there are no  restrictions  upon the voting or
transfer of any of the shares of capital  stock of the  Company  pursuant to the
Company's  Charter  Documents,  Bylaws  or  other  governing  documents  or  any
agreement or other  instruments  to which the Company is a party or by which the
Company is bound.

            2.3  Authorization;  Enforceability.  The Company has all  corporate
right, power and authority to enter into, execute and deliver this Agreement and
each other agreement, document, instrument and certificate to be executed by the
Company in connection  with the  consummation of the  transactions  contemplated
hereby,  including, but not limited to the Warrants and the Series E Certificate
of Designation (collectively,  the "Transaction Documents") and to perform fully
its obligations  hereunder and thereunder.  All corporate  action on the part of
the Company, its directors and stockholders  necessary for the (a) authorization
execution,  delivery  and  performance  of this  Agreement  and the  Transaction
Documents by the Company; and (b) authorization,  sale, issuance and delivery of
the Securities and the Common Shares  contemplated hereby and the performance of
the Company's obligations under this Agreement and the Transaction Documents has
been taken. This Agreement and the Transaction Documents have been duly executed
and  delivered by the Company and each  constitutes  a legal,  valid and binding
obligation of the Company,  enforceable  against the Company in accordance  with
its  respective  terms,  subject  to laws of  general  application  relating  to
bankruptcy,  insolvency  and the  relief of debtors  and rules of law  governing
specific  performance,  injunctive  relief or other equitable  remedies,  and to
limitations of public policy. The Securities and Common Shares,  when issued and
fully paid for in accordance with the terms of this  Agreement,  will be validly
issued,  fully paid and  nonassessable.  The issuance and sale of the Securities
and  Common  Shares  contemplated  hereby  will not give rise to any  preemptive
rights or rights of first refusal on behalf of any person.

                                       6
<PAGE>

            2.4 No Conflict; Governmental Consents.

                  (a)  The  execution  and  delivery  by  the  Company  of  this
Agreement and the Transaction Documents and the consummation of the transactions
contemplated  hereby will not (i) result in the  violation of any material  law,
statute,  rule, regulation,  order, writ, injunction,  judgment or decree of any
court or  governmental  authority  to or by which the  Company  is  bound,  (ii)
conflict  with  or  violate  any   provision  of  the   Company's   Articles  of
Incorporation  (the "Articles"),  as amended,  the Bylaws, or the Certificate of
Designation  of  Preferences,  Rights  and  Limitations  of Series B  Cumulative
Convertible  Preferred  Stock  (the  "Series  B  COD")  or  the  Certificate  of
Designation  of  Preferences,  Rights  and  Limitations  of Series C  Cumulative
Convertible  Preferred  Stock  (the  "Series  C  COD")  or  the  Certificate  of
Designation  of  Preferences,  Rights  and  Limitations  of Series D  Cumulative
Convertible  Preferred  Stock  (the  "Series D COD" and  collectively,  with the
Articles,  the Bylaws and the Series B COD,  and the Series C COD,  the "Charter
Documents")  of the Company,  and (iii) will not conflict  with,  or result in a
material  breach  or  violation  of,  any of the  terms  or  provisions  of,  or
constitute  (with or  without  due notice or lapse of time or both) a default or
give  to  others  any  rights  of   termination,   amendment,   acceleration  or
cancellation  (with or  without  due  notice,  lapse of time or both)  under any
agreement, credit facility, lease, loan agreement, mortgage, security agreement,
trust indenture or other agreement or instrument to which the Company is a party
or by which it is bound or to which any of its  properties or assets is subject,
nor result in the creation or imposition of any lien upon any of the  properties
or assets of the Company.

                  (b) No  approval  by the  holders  of Common  Stock,  or other
equity  securities  of the  Company is required to be obtained by the Company in
connection with the  authorization,  execution and delivery of this Agreement or
the  Transaction  Documents or in connection with the  authorization,  issue and
sale of the Securities, except as has been previously obtained,

                  (c) No consent, approval,  authorization or other order of any
governmental  authority is required to be obtained by the Company in  connection
with  the  authorization,  execution  and  delivery  of  this  Agreement  or the
Transaction Documents or in connection with the authorization, issue and sale of
the Securities,  except such filings as may be required to be made with the SEC,
NASD,  NASDAQ and with any state or foreign  blue sky or  securities  regulatory
authority.

                                       7
<PAGE>

            2.5 Consents of Third Parties.  No vote,  approval or consent of any
holder of capital stock of the Company or any other third parties is required or
necessary to be obtained by the Company in  connection  with the  authorization,
execution  and deliver of this  Agreement  or the  Transaction  Documents  or in
connection  with  the  consummation  of the  transactions  contemplated  by this
Agreement and/or the Transaction Documents, except as previously obtained.

            2.6  Licenses.  Except as otherwise set forth in the SEC Reports (as
defined  below),  the  Company  has  sufficient  licenses,   permits  and  other
governmental  authorizations  currently required for the conduct of its business
or  ownership  of  properties  and is in all  material  respects  in  compliance
therewith.

            2.7 Litigation.  Except as set forth in the SEC Reports, the Company
knows of no pending or threatened legal or governmental  proceedings against the
Company  which  could  materially  adversely  affect  the  business,   property,
financial  condition  or  operations  of the  Company  or which  materially  and
adversely  questions the validity of this Agreement or any agreements related to
the transactions  contemplated  hereby or the right of the Company to enter into
any of such agreements, or to consummate the transactions contemplated hereby or
thereby.  The Company is not a party or subject to the  provisions of any order,
writ,  injunction,  judgment  or  decree of any  court or  government  agency or
instrumentality which could materially adversely affect the business,  property,
financial  condition or  operations  of the Company.  There is no action,  suit,
proceeding or  investigation  by the Company  currently  pending in any court or
before any arbitrator or that the Company intends to initiate.

            2.8 Disclosure.  The information set forth in the Offering Materials
as of the date  hereof  and as of the date of each  Closing  contains  no untrue
statement  of a material  fact nor omits to state a material  fact  necessary in
order to make the statements  contained  therein,  in light of the circumstances
under which they were made, not misleading.

            2.9 Investment Company.  The Company is not an "investment  company"
within the meaning of such term under the  Investment  Company  Act of 1940,  as
amended, and the rules and regulations of the SEC thereunder.

            2.10 Brokers.  Except for the Placement  Agent,  neither the Company
nor any of the Company's  officers,  directors,  employees or  stockholders  has
employed or engaged  any broker or finder in  connection  with the  transactions
contemplated  by this Agreement and no fee or other  compensation  is or will be
due and owing to any broker,  finder,  underwriter,  placement  agent or similar
person in connection with the transactions  contemplated by this Agreement.  The
Company is not party to any agreement,  arrangement or understanding whereby any
person has an  exclusive  right to raise funds and/or place or purchase any debt
or equity securities for or on behalf of the Company.

                                       8
<PAGE>

            2.11 Intellectual Property; Employees.

                  (a)  To the  best  of  its  knowledge,  the  Company  owns  or
possesses  sufficient  legal rights to all patents,  trademarks,  service marks,
trade  names,  copyrights,  trade  secrets,  licenses,   information  and  other
proprietary rights and processes necessary for its business as now conducted and
as presently  proposed to be conducted,  without any known  infringement  of the
rights of others.  Except as disclosed in the Memorandum,  there are no material
outstanding  options,  licenses  or  agreements  of  any  kind  relating  to the
foregoing  proprietary  rights,  nor is the  Company  bound by or a party to any
material  options,  licenses  or  agreements  of any kind  with  respect  to the
patents,  trademarks,  service marks,  trade names,  copyrights,  trade secrets,
licenses,  information and other  proprietary  rights and processes of any other
person or entity  other  than  such  licenses  or  agreements  arising  from the
purchase of "off the shelf" or standard  products.  The Company has not received
any  written  communications  alleging  that the  Company  has  violated  or, by
conducting its business as presently proposed to be conducted, would violate any
of the patents,  trademarks,  service  marks,  trade names,  copyrights or trade
secrets or other proprietary rights of any other person or entity.

                  (b) Except as disclosed in the SEC Reports, the Company is not
aware that any of its  employees  is  obligated  under any  contract  (including
licenses, covenants or commitments of any nature) or other agreement, or subject
to any judgment,  decree or order of any court or  administrative  agency,  that
would interfere with their duties to the Company or that would conflict with the
Company's business as presently conducted.

                  (c) Neither the execution nor delivery of this Agreement,  nor
the carrying on of the Company's  business by the employees of the Company,  nor
the conduct of the  Company's  business as  presently  conducted,  will,  to the
Company's  knowledge,  conflict  with  or  result  in a  breach  of  the  terms,
conditions  or  provisions  of, or  constitute a default  under,  any  contract,
covenant or instrument under which any employee is now obligated.

                  (d) To the  Company's  knowledge,  no employee of the Company,
nor any consultant with whom the Company has contracted,  is in violation of any
term of any employment contract,  proprietary information agreement or any other
agreement  relating to the right of any such individual to be employed by, or to
contract  with, the Company  because of the nature of the business  conducted by
the Company;  and to the Company's  knowledge  the  continued  employment by the
Company of its present employees, and the performance of the Company's contracts
with its independent  contractors,  will not result in any such  violation.  The
Company has not received any written notice alleging that any such violation has
occurred.  Except as described in the Memorandum, no employee of the Company has
been  granted  the  right  to  continued  employment  by the  Company  or to any
compensation following termination of employment with the Company except for any
of the same which would not have a material  adverse  effect on the  business of
the Company. The Company is not aware that any officer, key employee or group of
employees  intends to terminate his, her or their  employment  with the Company,
nor does the Company have a present intention to terminate the employment of any
officer, key employee or group of employees.

            2.12 Title to Properties and Assets; Liens, Etc. Except as described
in the SEC Reports,  the Company has good and marketable title to its properties
and assets,  including the  properties  and assets  reflected in the most recent
balance sheet included in the Company's financial statements,  and good title to
its leasehold estates, in each case subject to no mortgage, pledge, lien, lease,
encumbrance or charge,  other than (a) those resulting from taxes which have not
yet  become  delinquent;  (b) liens  and  encumbrances  which do not  materially
detract from the value of the property subject thereto or materially  impair the
operations  of the  Company;  and (c) those  that have  otherwise  arisen in the
ordinary  course of  business.  The Company is in  compliance  with all material
terms of each lease to which it is a party or is otherwise bound.

                                       9
<PAGE>

            2.13 Obligations to Related Parties.  Except as described in the SEC
Reports and the M&A  agreement  entered with Duncan  Capital,  which is owned by
Michael  Crow, a shareholder  of the Company,  there are no  obligations  of the
Company to officers, directors,  stockholders, or employees of the Company other
than (a) for payment of salary or other compensation for services rendered,  (b)
reimbursement for reasonable  expenses incurred on behalf of the Company and (c)
for other standard employee  benefits made generally  available to all employees
(including  stock  option  agreements  outstanding  under any stock  option plan
approved by the Board of Directors of the  Company).  Except as may be disclosed
in  the  Memorandum,  the  Company  is  not a  guarantor  or  indemnitor  of any
indebtedness of any other person, firm or corporation.

            2.14   Subsidiaries.   The   Company   has  no  direct  or  indirect
Subsidiaries  other than as  specified  in the SEC  Reports.  The Company  owns,
directly or  indirectly,  all of the capital stock of each  Subsidiary  free and
clear of any and all liens, and all the issued and outstanding shares of capital
stock of each  Subsidiary are validly issued and are fully paid,  non-assessable
and free of preemptive and similar rights.

            2.15 SEC Reports;  Financial  Statements.  The Company has filed all
reports  required  to be filed by it under  the  Securities  Act and  Securities
Exchange Act of 1934 (the "Exchange Act"),  including  pursuant to Section 13(a)
or 15(d)  thereof,  for the twelve  months  preceding  the date  hereof (or such
shorter  period as the Company was  required by law to file such  reports)  (the
foregoing  materials being collectively  referred to herein as the "SEC Reports"
and,  together with the Schedules to this  Agreement (if any),  the  "Disclosure
Materials") on a timely basis or has timely filed a valid extension of such time
of filing and has filed any such SEC Reports prior to the expiration of any such
extension.  As of  their  respective  dates,  the SEC  Reports  complied  in all
material  respects with the  requirements of the Securities Act and the Exchange
Act and the rules and regulations of the SEC promulgated thereunder, and none of
the SEC Reports,  when filed,  contained any untrue statement of a material fact
or omitted to state a material fact  required to be stated  therein or necessary
in order to make the statements  therein,  in light of the  circumstances  under
which they were made, not  misleading.  The financial  statements of the Company
included in the SEC Reports  comply in all  material  respects  with  applicable
accounting  requirements  and the rules and  regulations of the SEC with respect
thereto as in effect at the time of filing. Such financial  statements have been
prepared in accordance with generally accepted accounting  principles applied on
a  consistent  basis  during the periods  involved,  except as may be  otherwise
specified in such financial  statements or the notes thereto, and fairly present
in all  material  respects  the  financial  position  of  the  Company  and  its
consolidated  Subsidiaries  as of and for the dates  thereof  and the results of
operations  and cash flows for the periods then ended,  subject,  in the case of
unaudited statements, to normal, immaterial, year-end audit adjustments.

                                       10
<PAGE>

            2.16 Press Releases.  The press releases disseminated by the Company
during the twelve months  preceding the date of this Agreement  taken as a whole
do not  contain  any  untrue  statement  of a  material  fact or omit to state a
material  fact  required to be stated  therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made and
when made, not misleading.

            2.17  Material  Changes.  Since  the  date  of  the  latest  audited
financial  statements  included  within the SEC Reports,  except as specifically
disclosed  in the SEC  Reports,  (i)  there  has been no  event,  occurrence  or
development  that has had or that could  reasonably  be  expected to result in a
material  adverse  effect,  (ii) the Company has not  incurred  any  liabilities
(contingent or otherwise)  other than (A) trade payables,  accrued  expenses and
other  liabilities  incurred in the ordinary course of business  consistent with
past practice and (B)  liabilities not required to be reflected in the Company's
financial  statements  pursuant to generally accepted  accounting  principles or
required to be disclosed in filings made with the SEC, (iii) the Company has not
altered  its method of  accounting  or the  identity of its  auditors,  (iv) the
Company has not declared or made any dividend or  distribution  of cash or other
property to its  stockholders  or purchased,  redeemed or made any agreements to
purchase or redeem any shares of its capital stock,  and (v) the Company has not
issued any equity  securities  to any  officer,  director or  affiliate,  except
pursuant to existing  Company  stock  option  plans.  The Company  does not have
pending before the SEC any request for confidential treatment of information.

            2.18 Labor  Relations.  No material  labor dispute exists or, to the
knowledge of the Company,  is imminent  with respect to any of the  employees of
the Company.

            2.19  Compliance.  The Company is in  compliance  with all effective
requirements of the  Sarbanes-Oxley  Act of 2002, as amended,  and the rules and
regulations   thereunder,   that  are   applicable  to  it,  except  where  such
noncompliance  could not have or  reasonably be expected to result in a material
adverse effect.

            2.20  Insurance.  The  Company and the  Subsidiaries  are insured by
insurers of recognized  financial  responsibility  against such losses and risks
and in such amounts as are prudent and customary in the  businesses in which the
Company and the Subsidiaries  are engaged.  The Company has no reason to believe
that it will not be able to renew its and the Subsidiaries'  existing  insurance
coverage as and when such coverage  expires or to obtain  similar  coverage from
similar  insurers  as may  be  necessary  to  continue  its  business  on  terms
consistent with market for the Company's and such Subsidiaries' respective lines
of business.

            2.21 Internal Accounting Controls.  The Company and the Subsidiaries
maintain  a  system  of  internal  accounting  controls  sufficient  to  provide
reasonable  assurance  that (i)  transactions  are executed in  accordance  with
management's general or specific authorizations,  (ii) transactions are recorded
as necessary to permit  preparation of financial  statements in conformity  with
generally accepted accounting  principles and to maintain asset  accountability,
(iii) access to assets is permitted only in accordance with management's general
or specific  authorization,  and (iv) the recorded  accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences. The Company has established disclosure
controls  and  procedures  (as  defined  in  Exchange  Act Rules  13a-15(e)  and
15d-15(e)) for the Company and designed such disclosure  controls and procedures
to ensure that  material  information  relating to the  Company,  including  its

                                       11
<PAGE>

Subsidiaries,  is made known to the  certifying  officers by others within those
entities,  particularly  during the period in which the Company's Form 10-KSB or
10-QSB, as the case may be, is being prepared. The Company's certifying officers
have  evaluated the  effectiveness  of the Company's  controls and procedures in
accordance  with  Item 307 of  Regulation  S-B under  the  Exchange  Act for the
Company's most recently ended fiscal quarter or fiscal  year-end (such date, the
"Evaluation Date"). The Company presented in its most recently filed Form 10-KSB
or  Form  10-QSB  the   conclusions  of  the   certifying   officers  about  the
effectiveness  of  the  disclosure   controls  and  procedures  based  on  their
evaluations as of the Evaluation  Date.  Since the Evaluation  Date,  there have
been no significant  changes in the Company's internal controls (as such term is
defined in Item  308(c) of  Regulation  S-B under the  Exchange  Act) or, to the
Company's  knowledge,  in other  factors  that  could  significantly  affect the
Company's internal controls.

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

            2.23  Certain  Registration  Matters.  Assuming  the accuracy of the
Subscribers'   representations   and  warranties,   no  registration  under  the
Securities Act is required for the offer and sale of the  Securities  and/or the
issuance  of the  Common  Shares by the  Company  to the  Subscribers  under the
Agreement.  The Company is eligible to register the resale of its Common  Shares
under Form SB-2 promulgated under the Securities Act.

            2.24 Listing and  Maintenance  Requirements.  Except as specified in
the SEC  Reports,  the  Company  has not,  in the two years  preceding  the date
hereof,  received  notice from any trading market to the effect that the Company
is not in compliance with the listing or maintenance  requirements  thereof. The
Company  is,  and has no reason to believe  that it will not in the  foreseeable
future   continue  to  be,  in  compliance  with  the  listing  and  maintenance
requirements  for  continued  listing or  quotation  of the Common  Stock on the
trading  market on which the Common  Stock is  currently  listed or quoted.  The
issuance and sale of the  Securities  and/or the  issuance of the Common  Shares
under the Agreement does not contravene the rules and regulations of the trading
market on which the Common Stock is currently listed or quoted,  and no approval
of the  shareholders  of the Company  thereunder  is required for the Company to
issue  and  deliver  to  the   Subscribers  the  Securities  and  Common  Shares
contemplated by this Agreement.

                                       12
<PAGE>

            2.25 No General Solicitation. None of the Company, its Subsidiaries,
any of their affiliates,  and any person acting on their behalf,  has engaged in
any form of general  solicitation or general  advertising (within the meaning of
Regulation D under the Securities  Act) in connection  with the offer or sale of
the Securities.

            2.26 No Integrated Offering.  None of the Company, its Subsidiaries,
any of their affiliates,  and any person acting on their behalf has, directly or
indirectly,  made any offers or sales of any security or solicited any offers to
buy any security,  under circumstances that would require registration of any of
the Securities under the Securities Act or cause this offering of the Securities
to be  integrated  with prior  offerings  by the  Company  for  purposes  of the
Securities  Act or any applicable  stockholder  approval  provisions,  including
without limitation, under the rules and regulations of any exchange or automated
quotation  system on which any of the  securities  of the  Company are listed or
designated.  None of the Company,  its  Subsidiaries,  their  affiliates and any
person  acting on their behalf will take any action or steps  referred to in the
preceding  sentence that would  require  registration  of any of the  Securities
under  the  Securities  Act  or  cause  the  offering  of the  Securities  to be
integrated with other offerings.

            2.27 Application of Takeover Protections.  The Company has taken all
necessary  action,  if any, in order to render  inapplicable  any control  share
acquisition, business combination, poison pill (including any distribution under
a rights agreement) or other similar anti-takeover provision under the Company's
Charter  Documents  or the laws of its state of  incorporation  that is or could
become  applicable to the  Subscribers  as a result of the  Subscribers  and the
Company  fulfilling  their  obligations  or  exercising  their rights under this
Agreement,   including,  without  limitation,  the  Company's  issuance  of  the
Securities and the Subscribers' ownership of the Securities.

            2.28  Privacy.  The  Company  agrees  not  to  disclose  the  names,
addresses or any other information about the Subscribers,  except as required by
law;  provided,  that  the  Company  may use the name of the  Subscriber  in any
registration  statement  filed  pursuant to Article V in which the  Subscriber's
Securities are included.

            2.29 No  Additional  Agreements.  The  Company  does  not  have  any
agreement or understanding with any Subscribers with respect to the transactions
contemplated by this Agreement other than as specified in this Agreement.

III. TERMS OF SUBSCRIPTION

            3.1 All funds shall be submitted  directly to the Company's  account
identified in Section 1.1 hereof.

            3.2 Certificates representing the Series E Preferred Stock purchased
by the  Subscriber  pursuant to this  Agreement will be prepared for delivery to
the  Subscriber  within 10  business  days  following  the Closing at which such
purchase takes place. The Subscriber  hereby  authorizes and directs the Company
to deliver the certificates  representing the Series E Preferred Stock purchased
by the  Subscriber  pursuant  to this  Agreement  directly  to the  Subscriber's
residential  or business or brokerage  house address  indicated on the signature
page hereto.

                                       13
<PAGE>

IV. CONDITIONS TO OBLIGATIONS OF THE SUBSCRIBERS

            4.1 The  Subscriber's  obligation to purchase the  Securities at the
Closing  at  which  such  purchase  is to  be  consummated  is  subject  to  the
fulfillment  on or prior to such  Closing  of the  following  conditions,  which
conditions  may be  waived  at the  option  of  each  Subscriber  to the  extent
permitted by law:

                  (a)  Covenants.  All  covenants,   agreements  and  conditions
contained  in this  Agreement  to be performed by the Company on or prior to the
date of such Closing shall have been  performed or complied with in all material
respects.

                  (b) No Legal Order Pending.  There shall not then be in effect
any legal or other order enjoining or restraining the transactions  contemplated
by this Agreement.

                  (c) No Law Prohibiting or Restricting  Such Sale.  There shall
not be in effect any law, rule or regulation  prohibiting  or  restricting  such
sale or  requiring  any consent or approval of any person,  which shall not have
been  obtained,  to issue the Securities  (except as otherwise  provided in this
Agreement).

                  (d)  Adverse  Changes.  Since  the date of  execution  of this
Agreement,  no event or series of events  shall have  occurred  that  reasonably
could have or result in a material adverse effect.

                  (e) No  Suspensions  of  Trading  in  Common  Stock;  Listing.
Trading  in the Common  Stock  shall not have been  suspended  by the SEC or any
trading  market  (except  for any  suspensions  of  trading of not more than one
trading day solely to permit dissemination of material information regarding the
Company)  at any time since the date of  execution  of this  Agreement,  and the
Common  Stock shall have been at all times since such date listed for trading on
a trading market.

                  (f) Series E  Designation.  The  Certificate of Designation of
the Preferences,  Rights and Limitations for the Series E Preferred, in the form
attached as Exhibit 5 to the Memorandum,  shall have been accepted for filing by
the Secretary of State of Florida.

                  (g) Blue Sky. The Company shall have  completed  qualification
for the Securities and the Common Shares under applicable Blue Sky laws.

                  (j) Legal Opinion.  Counsel to the Company shall issue a legal
opinion to the Subscribers in a form reasonably acceptable to the Subscribers.

V. REGISTRATION RIGHTS

            5.1  Definitions.  As used in this  Agreement,  the following  terms
shall have the following meanings.

                                       14
<PAGE>

                  (a) The term  "Holder"  shall mean any person owning or having
the right to acquire  Registrable  Securities or any  permitted  transferee of a
Holder.

                  (b) The  terms  "register,"  "registered"  and  "registration"
refer  to a  registration  effected  by  preparing  and  filing  a  registration
statement or similar document in compliance with the Securities Act.

                  (c)  The  term   "Registrable   Securities"   shall  mean  the
Conversion  Shares issuable upon conversion of the Preferred  Stock,  the Common
Stock  issued or  issuable  in payment of  quarterly  dividends  on the Series E
Preferred  Stock for a period of three (3) years from the  Closing,  the Warrant
Shares  issuable  upon exercise of the Warrants,  and any  securities  issued or
issuable upon any stock split, dividend or other distribution,  recapitalization
or similar event, or any conversion  price adjustment with respect to the Series
E Preferred Stock;  provided,  however, that securities shall only be treated as
Registrable  Securities  if and  only  for so long as they  (A)  have  not  been
disposed of pursuant to a registration  statement declared effective by the SEC;
(B)  have not been  sold in a  transaction  exempt  from  the  registration  and
prospectus  delivery  requirements  of the  Securities  Act so that all transfer
restrictions  and restrictive  legends with respect thereto are removed upon the
consummation of such sale; (C) are held by a Holder or a permitted transferee of
a Holder  pursuant to Section 5.11 hereof;  and (D) may not be disposed of under
Rule 144(k) under the Securities Act without restriction.

                  (d) The term  "Selling  Holder"  shall mean any  Holder  whose
Registrable Securities are included in a registration statement under discussion
herein.

            5.2 Mandatory  Registration.  The Company shall prepare, and, within
sixty (60) days  following  the Final  Closing  of this  Offering  (the  "Filing
Date"), will file with the SEC a registration statement on Form S-3 (or, if Form
S-3 is not then  available,  on such form of  registration  statement as is then
available to effect a registration of the Registrable  Securities)  covering the
resale of the Registrable  Securities.  The Company will use its best efforts to
have such registration statement declared effective within 180 days of the Final
Closing of this Offering.

            5.3 Intentionally Omitted.

            5.4 Registration Procedures.  Whenever required under this Article V
to include  Registrable  Securities  in a Company  registration  statement,  the
Company shall, as expeditiously as reasonably possible:

                  (a) Use best efforts to (i) cause such registration  statement
to become  effective,  and (ii)  cause  such  registration  statement  to remain
effective  until  the  earliest  to  occur of (A) such  date as the  sellers  of
Registrable  Securities (the "Selling  Holders") have completed the distribution
described in the  registration  statement or (B) for a period of three (3) years
from  Closing.  The Company will also use its best efforts to, during the period
that such registration  statement is required to be maintained  hereunder,  file

                                       15
<PAGE>

such post-effective amendments and supplements thereto as may be required by the
Securities Act and the rules and  regulations  thereunder or otherwise to ensure
that the  registration  statement  does not  contain  any  untrue  statement  of
material fact or omit to state a fact required to be stated therein or necessary
to make the statements  contained therein,  in light of the circumstances  under
which they are made, not misleading; provided, however, that if applicable rules
under the  Securities  Act  governing the  obligation  to file a  post-effective
amendment  permits,  in lieu of  filing  a  post-effective  amendment  that  (i)
includes any  prospectus  required by Section  10(a)(3) of the Securities Act or
(ii) reflects facts or events  representing a material or fundamental  change in
the  information  set  forth in the  registration  statement,  the  Company  may
incorporate  by  reference  information  required to be included in (i) and (ii)
above to the extent such  information  is  contained in periodic  reports  filed
pursuant  to  Section  13 or  15(d)  of the  Exchange  Act  in the  registration
statement.

                  (b)  Prepare  and  file  with  the  SEC  such  amendments  and
supplements  to  such  registration  statement,   and  the  prospectus  used  in
connection with such registration  statement, as may be necessary to comply with
the  provisions of the  Securities  Act with respect to the  disposition  of all
securities covered by such registration statement.

                  (c) Make  available  for  inspection  upon  reasonable  notice
during  the  Company's  regular  business  hours  by each  Selling  Holder,  any
underwriter  participating  in any  distribution  pursuant to such  registration
statement, and any attorney,  accountant or other agent retained by such Selling
Holder or  underwriter,  all financial and other  records,  pertinent  corporate
documents  and  properties  of the Company,  and cause the  Company's  officers,
directors and employees to supply all  information  reasonably  requested by any
such Selling Holder,  underwriter,  attorney,  accountant or agent in connection
with such  registration  statement  (provided the Company shall not disclose any
material  non-public  information  to  any  such  Selling  Holder,  underwriter,
attorney, accountant or agent without their prior written consent).

                  (d) Furnish to the Selling Holders such numbers of copies of a
final prospectus, in conformity with the requirements of the Securities Act, and
such other  documents as they may reasonably  request in order to facilitate the
disposition of Registrable Securities owned by them.

                  (e) Use best  efforts to register  and qualify the  securities
covered  by such  registration  statement  under  such  other  federal  or state
securities laws of such  jurisdictions  as shall be reasonably  requested by the
Selling Holders;  provided,  however,  that the Company shall not be required in
connection  therewith or as a condition  thereto to qualify to do business or to
file  a  general   consent  to  service  of  process  in  any  such   states  or
jurisdictions,  unless  the  Company  is  already  subject  to  service  in such
jurisdiction and except as may be required by the Securities Act.

                  (f) In the event of any underwritten  public  offering,  enter
into and perform its obligations under an underwriting  agreement,  in usual and
customary  form,  with the managing  underwriter of such offering.  Each Selling
Holder  participating in such underwriting shall also enter into and perform its
obligations under such an agreement.

                  (g)  Notify  each  Selling  Holder of  Registrable  Securities
covered by such registration  statement,  at any time when a prospectus relating
thereto is  required to be  delivered  under the  Securities  Act within one (1)
business  day of the  Company's  receipt  of notice,  (i) when the  registration
statement or any  post-effective  amendment  and  supplement  thereto has become
effective;  (ii) of the issuance by the SEC of any stop order or the  initiation
of  proceedings  for that  purpose (in which event the Company  shall make every
effort to obtain the  withdrawal of any order  suspending  effectiveness  of the

                                       16
<PAGE>

registration  statement  at the  earliest  possible  time or  prevent  the entry
thereof);  (iii) of the receipt by the Company of any notification  with respect
to the suspension of the qualification of the Registrable Securities for sale in
any jurisdiction or the initiation of any proceeding for such purpose;  and (iv)
of the  happening of any event as a result of which the  prospectus  included in
such registration  statement, as then in effect, includes an untrue statement of
a material fact or omits to state a material fact required to be stated  therein
or necessary to make the  statements  therein not misleading in the light of the
circumstances then existing.

                  (h) Cause all such Registrable Securities registered hereunder
to be listed or quoted on each securities exchange or quotation service on which
similar  securities  issued by the  Company  are then listed or quoted or, if no
such  similar  securities  are  listed  or quoted on a  securities  exchange  or
quotation service,  apply for qualification and use best efforts to qualify such
Registrable  Securities  for inclusion on an applicable  securities  exchange or
quotation service.

                  (i) Cause for the  removal  of the  restrictive  legend on any
certificates evidencing Registrable  Securities:  (i) following any sale of such
Registrable Securities pursuant to an effective registration  statement, or (ii)
following any proposed sale of such Registrable Securities pursuant to Rule 144,
or (iii) if such  Registrable  Securities  are eligible for legend removal under
Rule  144(k),   or  (iv)  if  such  legend  is  not  required  under  applicable
requirements  of the  Securities  Act (including  judicial  interpretations  and
pronouncements issued by the staff of the Commission).  If all or any portion of
a Series E Preferred Stock certificate is converted or Warrant is exercised at a
time when such underlying Common Shares being converted or exercised may be sold
under Rule 144(k) or if such legend is not otherwise  required under  applicable
requirements of the Securities Act (including judicial  interpretations thereof)
then such  underlying  Common  Shares shall be issued free of all  legends.  The
Company agrees that  following the  effectiveness  of a  registration  statement
hereunder  or at such  time as such  legend  is no longer  required  under  this
Section 5.4(i) pursuant to an applicable  exemption from registration,  it will,
no later than three (3) business  days  following  the delivery by Subscriber to
the  Company's  transfer  agent  of  a  certificate   representing   Registrable
Securities   accompanied   by   appropriate   stock  power  or  other   required
documentation, as applicable, issued with a restrictive legend, deliver or cause
to be delivered to such Subscriber a certificate  representing  such shares that
is free from all restrictive  and other legends,  in each case without charge to
the  Investor  other than  customary  transfer  fees which may be charged by the
transfer  agent or  broker-dealer.  The Company may not make any notation on its
records or give  instructions  to any transfer agent of the Company that enlarge
the restrictions on transfer set forth in this Section 5.4(i).  Without limiting
the Investor's other legal remedies,  the Company shall  immediately upon demand
reimburse  the  Subscriber  for the cost and  losses  occasioned  by any  buy-in
resulting  from  the  Company's  failure  to  timely  deliver  unlegended  share
certificates,  provided Subscriber provides documentation confirming such buy-in
was  initiated  by  Subscriber's  broker,  securities  custodian,  or other such
outside party, and not by Subscriber.

                                       17
<PAGE>

            5.5 Furnish  Information.  It shall be a condition  precedent to the
obligation  of the Company to take any action  pursuant  to this  Article V with
respect to the  Registrable  Securities of any Selling  Holder that such Selling
Holder  shall  furnish to the Company  such  information  regarding  the Selling
Holder, the Registrable  Securities held by the Selling Holder, and the intended
method of disposition of such securities as shall be reasonably  required by the
Company  to  effect  the  registration  of  such  Selling  Holder's  Registrable
Securities.

            5.6  Registration  Expenses.  The  Company  shall  bear  and pay all
expenses incurred in connection with any  registration,  filing or qualification
of Registrable  Securities with respect to  registrations  pursuant to Section V
for each Selling Holder,  including,  without limitation, in making filings with
the SEC, the NASD or NASDR,  and in connection with applicable  "blue sky" laws,
but excluding  underwriting  discounts and  commissions  relating to Registrable
Securities and excluding any professional fees or costs of accounting, financial
or legal advisors to any of the Holders.

            5.7  Underwriting  Requirements.  In  connection  with any  offering
involving an underwriting of shares of the Company's  capital stock, the Company
shall  not be  required  under  Section  5.3  to  include  any  of the  Holders'
Registrable  Securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between the Company and the underwriters selected by
it (or by other persons entitled to select the underwriters), provided, however,
that if the  total  amount  of  securities,  including  Registrable  Securities,
requested by stockholders to be included in such offering  exceeds the amount of
securities  that  the  underwriters   determine  in  their  sole  discretion  is
compatible with the success of the offering,  then the Company shall be required
to  include  in the  offering  only that  number of such  securities,  including
Registrable   Securities,   which  the  underwriters  determine  in  their  sole
discretion will not jeopardize the success of the offering,  provided,  however,
that  any  reduction  in the  securities  to be  included  in such  registration
statement  pursuant  to the  foregoing  shall be  apportioned  among  all of the
securities  proposed to be included in such registration  statement,  including,
but not limited to, all other  Registrable  Securities (based upon the number of
Registrable  Securities requested to be registered by each such Holder) on a pro
rata basis, but not including securities to be sold by the Company.

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

            5.9  Indemnification.  In the event that any Registrable  Securities
are included in a registration statement under this Article V:

                  (a) To the extent permitted by law, the Company will indemnify
and hold  harmless  each  Selling  Holder,  any  underwriter  (as defined in the
Securities  Act) for such Selling  Holder and each person,  if any, who controls
such Selling Holder or  underwriter  within the meaning of the Securities Act or
the Exchange Act, against any losses, claims,  damages, or liabilities (joint or
several)  to which they may become  subject  under the  Securities  Act,  or the
Exchange  Act,  insofar as such losses,  claims,  damages,  or  liabilities  (or
actions in respect  thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively a "Violation"): (i) any untrue

                                       18
<PAGE>

statement of a material fact contained in such registration statement, including
any  preliminary  prospectus  or  final  prospectus  contained  therein  or  any
amendments or supplements thereto, (ii) the omission to state therein a material
fact required to be stated therein,  or necessary to make the statements therein
not misleading, or (iii) any violation by the Company of the Securities Act, the
Exchange Act, or any rule or regulation promulgated under the Securities Act, or
the  Exchange  Act,  and the  Company  will  pay to each  such  Selling  Holder,
underwriter  or  controlling  person,  as incurred,  any legal or other expenses
reasonably  incurred by them in connection with  investigating  or defending any
such loss, claim, damage,  liability,  or action;  provided,  however,  that the
indemnity  agreement contained in this Section 5.9(a) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability, or action if such
settlement is effected  without the consent of the Company  (which consent shall
not be unreasonably withheld),  nor shall the Company be liable in any such case
for any such loss,  claim,  damage,  liability,  or action to the extent that it
arises out of or is based upon a Violation  which occurs in reliance upon and in
conformity with written  information  furnished  expressly for use in connection
with such  registration by any such Selling  Holder,  underwriter or controlling
person.

                  (b) To the extent  permitted by law, each Selling  Holder will
indemnify  and hold  harmless the Company,  each of its  directors,  each of its
officers,  each person,  if any, who controls the Company  within the meaning of
the Securities Act, any underwriter, any other Selling Holder selling securities
in  such  registration   statement  and  any  controlling  person  of  any  such
underwriter or other Selling Holder,  against any losses,  claims,  damages,  or
liabilities  (joint or several) to which any of the foregoing persons may become
subject,  under the Securities Act, or the Exchange Act, insofar as such losses,
claims,  damages, or liabilities (or actions in respect thereto) arise out of or
are  based  upon any  Violation,  in each  case to the  extent  (and only to the
extent)  that such  Violation  occurs in reliance  upon and in  conformity  with
written  information  furnished  by such  Selling  Holder  expressly  for use in
connection  with such  registration;  and each such Selling  Holder will pay, as
incurred, any legal or other expenses reasonably incurred by any person intended
to  be  indemnified   pursuant  to  this  Section  5.9(b),  in  connection  with
investigating or defending any such loss, claim, damage,  liability,  or action;
provided,  however, that any Selling Holder's liability pursuant to this Section
5.9 shall be limited to the amount of the net proceeds  received by such Selling
Holder  from the sale of the  Registrable  Securities  sold by it,  and  further
provided that the indemnity agreement contained in this Section 5.9(b) shall not
apply to amounts paid in settlement of any such loss, claim,  damage,  liability
or action if such  settlement  is  effected  without  the consent of the Selling
Holder, which consent shall not be unreasonably withheld.

                  (c) Promptly after receipt by an indemnified  party under this
Section  5.9  of  notice  of  the  commencement  of any  action  (including  any
governmental  action),  such  indemnified  party  shall,  if a claim in  respect
thereof is to be made  against any  indemnifying  party under this  Section 5.9,
deliver to the indemnifying  party a written notice of the commencement  thereof
and the  indemnifying  party shall have the right to participate in, and, to the
extent the indemnifying  party so desires,  jointly with any other  indemnifying
party similarly notified, to assume the defense thereof with counsel selected by
the  indemnifying  party and approved by the  indemnified  party (whose approval
shall not be  unreasonably  withheld);  provided,  however,  that an indemnified
party  (together  with all other  indemnified  parties which may be  represented
without  conflict by one  counsel)  shall have the right to retain one  separate
counsel,  with the fees and expenses to be paid by the  indemnifying  party,  if
representation  of  such  indemnified  party  by  the  counsel  retained  by the
indemnifying  party would be inappropriate due to actual or potential  differing
interests between such indemnified party and any other party represented by such
counsel  in such  proceeding.  The  failure  to  deliver  written  notice to the
indemnifying  party within a  reasonable  time of the  commencement  of any such
action, if prejudicial to its ability to defend such action,  shall relieve such
indemnifying  party of any liability to the indemnified party under this Section
5.9, but the omission so to deliver  written  notice to the  indemnifying  party
will not relieve it of any liability that it may have to any  indemnified  party
otherwise than under this Section 5.9.

                                       19
<PAGE>

                  (d) If the indemnification provided for in this Section 5.9 is
held by a court of competent  jurisdiction  to be  unavailable to an indemnified
party with respect to any loss, liability, claim, damage, or expense referred to
therein,  then the indemnifying  party, in lieu of indemnifying such indemnified
party  hereunder,  shall  contribute  to the  amount  paid  or  payable  by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such  proportion  as is  appropriate  to reflect  the  relative  fault of the
indemnifying  party on the one hand and of the indemnified party on the other in
connection  with  the  statements  or  omissions  that  resulted  in such  loss,
liability,  claim,  damage,  or expense as well as any other relevant  equitable
considerations.  The  relative  fault  of  the  indemnifying  party  and  of the
indemnified  party shall be  determined  by reference  to,  among other  things,
whether the untrue or alleged untrue statement of a material fact or the alleged
omission  to state a  material  fact  relates  to  information  supplied  by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge,  access to  information,  and  opportunity to correct or prevent such
statement or omission.

                  (e)  Notwithstanding  the  foregoing,  to the extent  that the
provisions on  indemnification  and  contribution  contained in an  underwriting
agreement entered into in connection with an underwritten public offering are in
conflict  with the foregoing  provisions,  the  provisions in such  underwriting
agreement shall control.

                  (f) The  obligations  of the Company  and  Holders  under this
Section 5.9 shall survive the completion of the Offering.

            5.10 Reports Under  Securities  Exchange Act of 1934. With a view to
making  available  to the Holders the benefits of Rule 144 and any other rule or
regulation of the SEC that may at any time permit a Holder to sell securities of
the Company to the public without  registration or pursuant to a registration on
Form S-3 (or other applicable form), the Company agrees to:

                  (a) file with the SEC all reports and other documents required
of the Company under the Securities Act and the Exchange Act;

                  (b)  furnish to any  Holder,  so long as the  Holder  owns any
Registrable  Securities,  forthwith  upon  request (i) a copy of the most recent
annual or quarterly  report of the Company and such other  reports and documents
so filed by the Company,  and (ii) such other  information  as may be reasonably
requested  in  availing  any Holder of any rule or  regulation  of the SEC which
permits the selling of any such securities  without  registration or pursuant to
such form; and

                                       20
<PAGE>

                  (c) cause the  Company's  legal  counsel  to issue  such legal
opinions, at the Company's expense, as may be reasonably requested by the Holder
in  connection  with any  sales or  proposed  sales  of  Registrable  Securities
pursuant to Rule 144 or other similar rule or  regulation  that may be in effect
at such time.

            5.11  Permitted  Transferees.  The  rights to cause the  Company  to
register Registrable Securities granted to the Holders by the Company under this
Article V may be assigned in full by a Holder in  connection  with a transfer by
such  Holder of its  Registrable  Securities  if: (a) such  Holder  gives  prior
written  notice to the Company;  (b) such  transferee  agrees to comply with the
terms and  provisions  of this  Agreement;  (c) such  transfer is  otherwise  in
compliance with this Agreement;  and (d) such transfer is otherwise  effected in
accordance with applicable securities laws.

            5.12  Termination  of  Registration  Rights  The  obligation  of the
Company  to  include  a  Holder's  Registrable  Securities  in any  registration
pursuant  to this  Section  V  shall  terminate  if all  shares  of  Registrable
Securities held by such Holder can immediately be sold under Rule 144(k).

VI. COVENANTS OF THE COMPANY

            6.1  Integration.  The Company  shall not,  and shall ensure that no
affiliate of the Company shall, sell, offer for sale or solicit offers to buy or
otherwise  negotiate  in respect of any security (as defined in Section 2 of the
Securities  Act)  that  would  be  integrated  with  the  offer  or  sale of the
Securities in a manner that would require the registration  under the Securities
Act  of the  sale  of the  Securities  to the  Subscribers,  or  that  would  be
integrated  with the offer or sale of the  Securities  for purposes of the rules
and regulations of any trading market in a manner that would require stockholder
approval of the sale of the securities to the Subscribers.

            6.2 Listing of Securities.  The Company  agrees,  (i) if the Company
applies to have the Common Stock  traded on any other  trading  market,  it will
include in such application the Registrable Securities, and will take such other
action as is necessary or desirable to cause the  Registrable  Securities  to be
listed on such other  trading  market as promptly as possible,  and (ii) it will
take all action reasonably  necessary to continue the listing and trading of its
Common Stock on a trading  market and will comply in all material  respects with
the Company's reporting,  filing and other obligations under the bylaws or rules
of the trading market.

            6.3 Reservation of Shares.  The Company shall at all times while the
Securities are outstanding maintain a reserve from its duly authorized shares of
Common Stock of a number of shares of Common Stock  sufficient  to allow for the
issuance of all Conversion  Shares,  Warrant Shares,  and shares of Common Stock
issuable in payment of dividends on the Series E Preferred Stock.

                                       21
<PAGE>

            6.4 Conversion and Exercise  Procedures.  The conversion  procedures
described in and the form of Notice of Conversion included in the Certificate of
Designation  of  Preferences,  Rights  and  Limitations  of  the  Series  E  12%
Cumulative  Convertible  Preferred Stock (the  "Certificate of Designation") set
forth the totality of the  procedures  required by the  Subscribers  in order to
convert the Shares. The exercise procedures described in and the form of Form of
Subscription  included in the Warrant set forth the  totality of the  procedures
required by the Subscribers in order to exercise the warrants. The Company shall
honor  conversions  of Shares and exercises of Warrants and shall deliver Common
Stock in  accordance  with the terms,  conditions  and time periods set forth in
this Agreement and the Certificate of Designation or Warrant (as applicable).

            6.5 Rescission and Withdrawal Right. Notwithstanding anything to the
contrary  contained in (and without  limiting  any similar  provisions  of) this
Agreement, whenever any Subscriber exercises a right, election, demand or option
under this  Agreement  and the  Company  does not  timely  perform  its  related
obligations  within the  periods  therein  provided,  then such  Subscriber  may
rescind  or  withdraw,  in its sole  discretion  from time to time upon  written
notice to the Company,  any relevant  notice,  demand or election in whole or in
part without prejudice to its future actions and rights.

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

            6.7 Right of First  Refusal.  Until the shares of Series E Preferred
Stock are no longer  outstanding,  except in  connection  with the  issuance  of
securities  associated  with (i) the issuance to employees  under the  Company's
stock  incentive or option plan; (ii) issued for  consideration  other than cash
pursuant  to  a  merger,   consolidation,   acquisition,   or  similar  business
combination approved by the Company's Board of Directors;  (iii) issued pursuant
to any equipment loan or leasing arrangement,  real property leasing arrangement
or debt financing from a bank or similar financial  institution  approved by the
Board of Directors;  (iv) warrants  issued in connection  with a secured finance
loan or (v)  securities  upon the exercise of or  conversion of or in payment of
dividends on any securities issued hereunder, convertible securities, options or
warrants issued and outstanding as of the Closing, provided that such securities
have not  been  amended  since  the  Closing  to  increase  the  number  of such
securities  or to  decrease  the  exercise  or  conversion  price  of  any  such
securities. ("Excepted Issuances"), the holders of the Series E Preferred Stock,

                                       22
<PAGE>

to the extent that the holders of the  Company's  Series D Preferred  Stock have
not  exercised  their  right of first  refusal,  shall have a pro-rata  right to
participate  in  subsequent  issuances  by the Company of debt,  equity or other
securities  (the "Right of First  Refusal").  The Company  shall give holders of
Series E  Preferred  Stock not less than ten (10)  business  days prior  written
notice  of any  proposed  sale by the  Company  of its  Common  Stock  or  other
securities or debt obligations.  The holders of the Series E Preferred Stock who
exercise  their rights  pursuant to this Right of First  Refusal  shall have the
right  during  the ten (10)  business  days  following  receipt of the notice to
purchase such offered  equity,  debt or other  securities in accordance with the
terms and conditions  set forth in the notice of sale in the same  proportion to
each  other  and to the  holders  of the  Series  D  Preferred  Stock  as  their
percentage of the Series D Preferred Stock and Series E Preferred  Stock, in the
aggregate,  outstanding at that time. In the event such terms and conditions are
modified  during the notice  period,  the Company shall give holders of Series E
Preferred  Stock  prompt  notice of such  modification  and shall have the right
during  the ten (10)  business  days  following  the notice of  modification  to
exercise  such  right.  If a holder  of  Series D  Preferred  Stock or  Series E
Preferred Stock elects to not participate in such financing,  then the remaining
holders shall have the right to participate in that holder's allocation on a pro
rata basis.  An election by a holder not to exercise its Right of First  Refusal
with  respect to a security  issuance  shall not effect such  holder's  Right of
First Refusal with respect to any other security issuance.

            6.8 Intentionally Omitted.

            6.9  Access.  The  holders of the Series E  Preferred  Stock will be
granted  access to the Company  facilities  and personnel  during normal working
hours and with reasonable advance written notice,  provided,  however,  that the
Company  covenants  and agrees  not to provide  any such  holder  with  material
non-public  information  unless prior  thereto such holder shall have executed a
written  agreement  regarding the  confidentiality  and use of such information.
Upon filing its quarterly and annual  reports with the  Securities  and Exchange
Commission,  the Company shall deliver such reports to the holders of the Series
E Preferred Stock upon their request.

            6.10 Key Man Life  Insurance.  The Company shall obtain and maintain
at all times that any shares of Series E Preferred Stock remain outstanding, key
man  life  insurance  policies  on  the  senior  executives  and  key  employees
identified by and in such amounts as  reasonably  requested by a majority of the
holders of Series E Preferred Stock.

            6.11  Dividends.  Until such time as there are no shares of Series E
Preferred Stock outstanding, the Company shall pay all dividends on the Series E
Preferred  Stock,  in cash or in Common Stock as  determined  by the Company and
shall pay any and all other dividends due and payable on any series of preferred
stock issued prior to the Series E Preferred  Stock having  preference  over the
Series E  Preferred  Stock so that any  payment  of  dividends  on the  Series E
Preferred  Stock  shall  not  violate  the  provisions  of any  other  series of
preferred stock outstanding as of the Initial Closing.

            6.12 Indemnification.

                  (a) The Company  agrees to  indemnify  and hold  harmless  the
Subscriber, its affiliates and their respective officers, directors,  employees,
agents and controlling persons  (collectively,  the "Indemnified  Parties") from
and  against,  any and all loss,  liability,  damage or  deficiency  suffered or
incurred by any Indemnified Party by reason of any  misrepresentation  or breach

                                       23
<PAGE>

of warranty by the Company or  nonfulfillment of any covenant or agreement to be
performed or complied with by the Company under this Agreement,  the Transaction
Documents;  and will promptly reimburse the Indemnified Parties for all expenses
(including  reasonable  fees and  expenses  of legal  counsel)  as  incurred  in
connection with the investigation of,  preparation for or defense of any pending
or  threatened  claim  related  to or  arising  in any  manner out of any of the
foregoing,  or  any  action  or  proceeding  arising  therefrom   (collectively,
"Proceedings"),  whether or not such Indemnified  Party is a formal party to any
such Proceeding.

                  (b) If for  any  reason  (other  than a  final  non-appealable
judgment  finding any  Indemnified  Party  liable for losses,  claims,  damages,
liabilities  or expenses for its gross  negligence  or willful  misconduct)  the
foregoing  indemnity is unavailable to an Indemnified  Party or  insufficient to
hold an Indemnified  Party  harmless,  then the Company shall  contribute to the
amount paid or payable by an Indemnified  Party as a result of such loss, claim,
damage, liability or expense in such proportion as is appropriate to reflect not
only the  relative  benefits  received  by the  Company  on the one hand and the
Advisor  on the  other,  but also the  relative  fault  by the  Company  and the
Indemnified Party, as well as any relevant equitable considerations.

VII. MISCELLANEOUS

            7.1 Any  notice  or other  communication  given  hereunder  shall be
deemed sufficient if in writing and sent by registered or certified mail, return
receipt  requested,  or  delivered  by hand against  written  receipt  therefor,
addressed as follows:

            if to the Company, to it at:
            National Investment Managers Inc.
            420 Lexington Ave, Suite 2420
            New York, New York 10170
            Attn:  Leonard A. Neuhaus, CFO

            With a copy to (which shall not constitute notice):

            Sichenzia Ross Friedman Ference LLP
            1065 Avenue of the Americas
            New York, NY 10018
            Attn:  Gregory Sichenzia, Esq.

            if to the Subscriber,  to the Subscriber's  address indicated on the
            signature page of this Agreement.

Notices shall be deemed to have been given or delivered on the date of receipt.

            7.2 Except as otherwise provided herein, this Agreement shall not be
changed,  modified  or amended  except by a writing  signed by the parties to be
charged,  and this  Agreement may not be  discharged  except by  performance  in
accordance with its terms or by a writing signed by the party to be charged.

                                       24
<PAGE>

            7.3 Subject to the provisions of Section 5.11,  this Agreement shall
be  binding  upon and inure to the  benefit of the  parties  hereto and to their
respective heirs, legal representatives,  successors and assigns. This Agreement
sets forth the entire agreement and understanding  between the parties as to the
subject  matter  hereof  and  merges  and  supersedes  all  prior   discussions,
agreements and understandings of any and every nature among them.

            7.4  Upon  the  execution  and  delivery  of this  Agreement  by the
Subscriber,  this Agreement shall become a binding  obligation of the Subscriber
with respect to the purchase of Securities as herein provided, subject, however,
to the right  hereby  reserved by the Company to enter into the same  agreements
with  other  subscribers  and to reject any  subscription,  in whole or in part,
provided the Company  returns to Subscriber  any funds paid by  Subscriber  with
respect to such rejected  subscription or portion  thereof,  without interest or
deduction.

            7.5  NOTWITHSTANDING  THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED
BY ANY OF THE PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT ALL THE TERMS AND
PROVISIONS HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK WITHOUT REGARD TO SUCH STATE'S  PRINCIPLES OF CONFLICTS
OF LAW. IN THE EVENT THAT A JUDICIAL PROCEEDING IS NECESSARY, THE SOLE FORUM FOR
RESOLVING  DISPUTES  ARISING OUT OF OR RELATING TO THIS  AGREEMENT IS THE COURTS
STATE OF NEW YORK IN AND FOR THE  COUNTY OF NEW YORK OR THE  FEDERAL  COURTS FOR
SUCH STATE AND COUNTY,  AND ALL RELATED  APPELLATE  COURTS,  THE PARTIES  HEREBY
IRREVOCABLY CONSENT TO THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID VENUE.

            7.6 In order to discourage  frivolous  claims the parties agree that
unless a claimant in any proceeding  arising out of this  Agreement  succeeds in
establishing   his  claim  and  recovering  a  judgment  against  another  party
(regardless of whether such claimant  succeeds  against one of the other parties
to the  action),  then the other party  shall be  entitled to recover  from such
claimant all of its/their  reasonable legal costs and expenses  relating to such
proceeding and/or incurred in preparation therefor.

            7.7 The holding of any provision of this  Agreement to be invalid or
unenforceable  by a court of competent  jurisdiction  shall not affect any other
provision of this Agreement, which shall remain in full force and effect. If any
provision  of  this  Agreement  shall  be  declared  by  a  court  of  competent
jurisdiction  to be invalid,  illegal or incapable of being enforced in whole or
in part, such provision shall be interpreted so as to remain  enforceable to the
maximum  extent  permissible  consistent  with  applicable law and the remaining
conditions and provisions or portions thereof shall nevertheless  remain in full
force and  effect  and  enforceable  to the  extent  they are  valid,  legal and
enforceable, and no provisions shall be deemed dependent upon any other covenant
or provision unless so expressed herein.

            7.8 It is agreed  that a waiver  by either  party of a breach of any
provision of this Agreement shall not operate,  or be construed,  as a waiver of
any subsequent breach by that same party.

                                       25
<PAGE>

            7.9 The  Company  agrees to execute  and  deliver  all such  further
documents,  agreements and instruments and take such other and further action as
may be  necessary  or  appropriate  to carry out the purposes and intent of this
Agreement.

            7.10 This Agreement may be executed in two or more counterparts each
of which shall be deemed an original, but all of which shall together constitute
one and the same instrument.

            7.11 Nothing in this  Agreement  shall create or be deemed to create
any rights in any person or entity not a party to this Agreement, except for the
holders of Registrable Securities.

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

            7.13 Independent Nature of Subscribers'  Obligations and Rights. The
obligations  of each  Subscriber  under this Agreement are several and not joint
with  the  obligations  of any  other  Subscriber,  and no  Subscriber  shall be
responsible  in any way for the  performance  of the  obligations  of any  other
Subscriber  under this  Agreement.  The decision of each  Subscriber to purchase
Securities  pursuant  to  this  Agreement  has  been  made  by  such  Subscriber
independently of any other Subscriber.  Nothing contained herein,  and no action
taken by any  Subscriber  pursuant  thereto,  shall be deemed to constitute  the
Subscribers as a partnership,  an association, a joint venture or any other kind
of entity, or create a presumption that the Subscribers are in any way acting in
concert  or as a group  with  respect to such  obligations  or the  transactions
contemplated  herein. Each Subscriber  acknowledges that no other Subscriber has
acted as agent for such  Subscriber  in  connection  with making its  investment
hereunder and that no Subscriber  will be acting as agent of such  Subscriber in
connection  with  monitoring  its  investment in the Securities or enforcing its
rights under this Agreement.  Each Subscriber shall be entitled to independently
protect and enforce its rights,  including without limitation the rights arising
out of this Agreement, and it shall not be necessary for any other Subscriber to
be joined as an additional party in any proceeding for such purpose. The Company
acknowledges  that  each of the  Subscribers  has been  provided  with this same
Agreement for the purpose of closing a transaction with multiple Subscribers and
not because it was required or requested to do so by any Subscriber.

VIII. CONFIDENTIAL INVESTOR QUESTIONNAIRE

            8.1 The Subscriber  represents and warrants that he, she or it comes
within one category marked below, and that for any category  marked,  he, she or
it has truthfully set forth,  where applicable,  the factual basis or reason the
Subscriber  comes  within that  category.  ALL  INFORMATION  IN RESPONSE TO THIS
SECTION WILL BE KEPT STRICTLY  CONFIDENTIAL.  The undersigned  agrees to furnish
any additional  information which the Company deems necessary in order to verify
the answers set forth below.

                                       26
<PAGE>

Category  A ___     The   undersigned  is  an  individual  (not  a  partnership,
                    corporation,  etc.) whose individual net worth, or joint net
                    worth with his or her spouse, presently exceeds $1,000,000.

                    Explanation. In calculating net worth you may include equity
                    in  personal  property  and  real  estate,   including  your
                    principal residence, cash, short-term investments, stock and
                    securities.  Equity in  personal  property  and real  estate
                    should be based on the fair  market  value of such  property
                    less debt secured by such property.

Category  B ___     The   undersigned  is  an  individual  (not  a  partnership,
                    corporation,  etc.) who had an income in excess of  $200,000
                    in each of the two most recent  years,  or joint income with
                    his or her  spouse in excess  of  $300,000  in each of those
                    years (in each case  including  foreign  income,  tax exempt
                    income  and full  amount of  capital  gains and  losses  but
                    excluding  any  income  of  other  family  members  and  any
                    unrealized  capital   appreciation)  and  has  a  reasonable
                    expectation of reaching the same income level in the current
                    year.

Category  C ___     The  undersigned  is a director or executive  officer of the
                    Company which is issuing and selling the Securities.

Category  D ___     The  undersigned is a bank; a savings and loan  association;
                    insurance company; registered investment company; registered
                    business  development   company;   licensed  small  business
                    investment company ("SBIC"); or employee benefit plan within
                    the  meaning  of  Title 1 of  ERISA  and (a) the  investment
                    decision is made by a plan fiduciary which is either a bank,
                    savings   and  loan   association,   insurance   company  or
                    registered  investment  advisor,  or (b) the plan has  total
                    assets  in excess of  $5,000,000  or (c) is a self  directed
                    plan with  investment  decisions made solely by persons that
                    are accredited investors. (describe entity)
                    ____________________________________________________________
                    ____________________________________________________________

Category  E ___     The undersigned is a private business development company as
                    defined in section 202(a)(22) of the Investment Advisors Act
                    of 1940. (describe entity)
                    ____________________________________________________________
                    ____________________________________________________________

Category  F ___     The  undersigned  is  either  a  corporation,   partnership,
                    Massachusetts  business  trust,  or non-profit  organization
                    within  the  meaning of Section  501(c)(3)  of the  Internal
                    Revenue  Code,  in each  case not  formed  for the  specific
                    purpose of acquiring the Securities and with total assets in
                    excess of $5,000,000. (describe entity)
                    ____________________________________________________________
                    ____________________________________________________________

                                       27
<PAGE>

Category G ___      The  undersigned  is a trust with total  assets in excess of
                    $5,000,000, not formed for the specific purpose of acquiring
                    the  Securities,   where  the  purchase  is  directed  by  a
                    "sophisticated    investor"   as   defined   in   Regulation
                    506(b)(2)(ii) under the Act.

Category H ___      The  undersigned  is an entity (other than a trust) in which
                    all of the equity owners are "accredited  investors"  within
                    one or more of the above  categories.  If relying  upon this
                    Category  alone,  each equity owner must complete a separate
                    copy of this Agreement. (describe entity)
                    ____________________________________________________________
                    ____________________________________________________________

Category  I ___     The  undersigned is not within any of the  categories  above
                    and is therefore not an accredited investor.

                    The undersigned  agrees that the undersigned will notify the
                    Company at any time on or prior to the  Closing in the event
                    that the  representations  and  warranties in this Agreement
                    shall cease to be true, accurate and complete.

            8.2 SUITABILITY (please answer each question)

      (a) For an individual Subscriber, please describe your current employment,
including  the company by which you are  employed  and its  principal  business:
      __________________________________________________________________________
      __________________________________________________________________________
      __________________________________________________________________________
      __________________________________________________________________________

      (b) For an individual Subscriber,  please describe any college or graduate
degrees held by you:
      __________________________________________________________________________
      __________________________________________________________________________
      __________________________________________________________________________
      __________________________________________________________________________

      (c) For all Subscribers, please list types of prior investments:
      __________________________________________________________________________
      __________________________________________________________________________
      __________________________________________________________________________
      __________________________________________________________________________

                                       28
<PAGE>

      (d) For all  Subscribers,  please state whether you have  participated  in
other private placements before:

                                 YES |_| NO |_|

      (e) If your  answer  to  question  (d) above was  "YES",  please  indicate
frequency of such prior participation in private placements of:

                                                           Public or Private
                                                           Companies with no,
                Public                Private              or insignificant,
                Companies             Companies            assets and operations

Frequently      ________________      ________________     ________________
Occasionally    ________________      ________________     ________________
Never           ________________      ________________     ________________

      (f) For individual Subscribers, do you expect your current level of income
to significantly decrease in the foreseeable future:

                                 YES |_| NO |_|

      (g) For trust, corporate, partnership and other institutional Subscribers,
do you expect your total  assets to  significantly  decrease in the  foreseeable
future:

                                 YES |_| NO |_|

      (h) For all Subscribers,  do you have any other  investments or contingent
liabilities which you reasonably  anticipate could cause you to need sudden cash
requirements in excess of cash readily available to you:

                                 YES |_| NO |_|

      (i) For all  Subscribers,  are you familiar  with the risk aspects and the
non-liquidity  of  investments  such as the  securities  for  which  you seek to
subscribe?

                                 YES |_| NO |_|

      (j) For all  Subscribers,  do you understand that there is no guarantee of
financial  return on this  investment  and that you run the risk of losing  your
entire investment?

                                 YES |_| NO |_|

            8.3 MANNER IN WHICH TITLE IS TO BE HELD. (circle one)

            (a)   Individual Ownership
            (b)   CommSharey Property
            (c)   Joint Tenant with Right of Survivorship
                  (both parties must sign)
            (d)   Partnership*
            (e)   Tenants in Common
            (f)   Company*
            (g)   Trust*
            (h)   Other*

                                       29
<PAGE>

            *If Securities are being  subscribed for by an entity,  the attached
Certificate of Signatory must also be completed.

            8.4 NASD AFFILIATION.

Are you affiliated or associated with an NASD member firm (please check one):

Yes |_| No |_|

If Yes, please describe:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

*If Subscriber is a Registered Representative with an NASD member firm, have the
following acknowledgment signed by the appropriate party:

The undersigned NASD member firm acknowledges  receipt of the notice required by
Article 3, Sections 28(a) and (b) of the Rules of Fair Practice.

__________________________________
Name of NASD Member Firm

By: ______________________________
          Authorized Officer

Date: ____________________________

            8.5 The  undersigned is informed of the  significance to the Company
of the  foregoing  representations  and answers  contained  in the  Confidential
Investor Questionnaire  contained in this Article VII and such answers have been
provided under the assumption that the Company will rely on them.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       30
<PAGE>

    NUMBER OF SHARES _________ X $100.00 = $_________ (the "Purchase Price")

____________________________________        ____________________________________
Signature                                   Signature (if purchasing jointly)

____________________________________        ____________________________________
Name Typed or Printed                       Name Typed or Printed

____________________________________        ____________________________________
Title (if Subscriber is an Entity)          Title (if Subscriber is an Entity)

____________________________________        ____________________________________
Entity Name (if applicable)                 Entity Name (if applicable)

____________________________________        ____________________________________
____________________________________        ____________________________________
Address                                     Address

____________________________________        ____________________________________
City, State and Zip Code                    City, State and Zip Code

____________________________________        ____________________________________
Telephone-Business                          Telephone-Business

____________________________________        ____________________________________
Telephone-Residence                         Telephone-Residence

____________________________________        ____________________________________
Facsimile-Business                          Facsimile-Business

____________________________________        ____________________________________
Facsimile-Residence                         Facsimile-Residence

____________________________________        ____________________________________
Tax ID # or Social Security #               Tax ID # or Social Security #

Name in which securities should be issued:  ____________________________________

Dated: ____________, 2006

      This  Subscription  Agreement is agreed to and accepted as of ___________,
2006.

                                        NATIONAL INVESTMENT MANAGERS INC.

                                        By:______________________________
                                           Name:  Steven Ross
                                           Title: Chief Executive Officer

                                       31
<PAGE>

                            CERTIFICATE OF SIGNATORY

                       (To be completed if Securities are
                       being subscribed for by an entity)

I,   ____________________________,   am  the   ____________________________   of
__________________________________________ (the "Entity").

I certify that I am empowered  and duly  authorized by the Entity to execute and
carry out the terms of the  Subscription  Agreement and to purchase and hold the
shares of Series E Preferred  Stock,  and certify further that the  Subscription
Agreement  has been  duly and  validly  executed  on behalf  of the  Entity  and
constitutes a legal and binding obligation of the Entity.

IN WITNESS WHEREOF,  I have set my hand this ________ day of  _________________,
200_

                                            ____________________________________
                                            (Signature)

                                       32

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