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Unassociated Document

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

    

    SERIES
      D
      WARRANT TO PURCHASE

    

    SHARES
      OF
      COMMON STOCK

    

    OF

    

    JPAK
      GROUP, INC.

    

    
      	
              No.:
                D-__

            	
              Number
                of Shares: _________1 

            
	
              Date
                of Issuance: ________ __, 20__

            	 

    

    Expires
      ________ __, 20__ [Four years following Original Issue Date]

    

    

    FOR
      VALUE
      RECEIVED, the undersigned, Jpak Group, Inc., a Nevada corporation (f/k/a Rx
      Staffing, Inc., together with its successors and assigns, the "Issuer"),
      hereby certifies that ___________________
      or
      its
      registered assigns is entitled to subscribe for and purchase, during the Term
      (as hereinafter defined), up to ___________________ (________) shares (subject
      to adjustment as hereinafter provided) of the duly authorized, validly issued,
      fully paid and non-assessable Common Stock of the Issuer, at an exercise price
      per share equal to the Warrant Price then in effect, subject, however, to the
      provisions and upon the terms and conditions hereinafter set forth. Capitalized
      terms used in this Warrant and not otherwise defined herein shall have the
      respective meanings specified in Section 9 hereof.

    

    1. Term.
      The
      term of this Warrant shall commence on ________ __, 20__ and shall expire at
      6:00 p.m., Eastern Time, on ________ __, 20__ [four years following Original
      Issue Date] (such period being the "Term").

    

    
      	 	
              2.

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

            

    

    

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

     

     

    ________________________

      1
        Exercisable for such number of shares of Common Stock equal to fifty percent
        (50%) of the number of shares of Common Stock issuable upon conversion of
        the
        shares of Series B Convertible Preferred Stock that have been issued to the
        Holder upon exercise of its Series J Warrant.

    
      
        
        

      

      
        -1-

        
          

        

      

      
        
        

      

    

    

    

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

    

    (c) Cashless
      Exercise.
      Notwithstanding any provisions herein to the contrary and commencing one (1)
      year following the Original Issue Date if (i) the Per Share Market Value of
      one
      share of Common Stock is greater than the Warrant Price (at the date of
      calculation as set forth below) and (ii) a registration statement under the
      Securities Act providing for the resale of the Warrant Stock is not then in
      effect, unless the registration statement is not effective as a result of the
      Issuer exercising its rights under Section 3(n) of the Registration Rights
      Agreement, in lieu of exercising this Warrant by payment of cash, the Holder
      may
      exercise this Warrant by a cashless exercise and shall receive the number of
      shares of Common Stock equal to an amount (as determined below) by surrender
      of
      this Warrant at the principal office of the Issuer together with the properly
      endorsed Notice of Exercise in which event the Issuer shall issue to the Holder
      a number of shares of Common Stock computed using the following
      formula:

    

    X
      = Y -
(A)(Y)

      
 B

    

    
      	
              Where

            	
              X
                =

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

            

    

    

    
      	 	
              Y
                =

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

            

    

    

    
      	 	
              A
                =

            	
              the
                Warrant Price. 

            

    

    

    
      	 	
              B
                =

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

            

    

    

    (d) Issuance
      of Stock Certificates.
      In the
      event of any exercise of this Warrant in accordance with and subject to the
      terms and conditions hereof, certificates for the shares of Warrant Stock so
      purchased shall be dated the date of such exercise and delivered to the Holder
      hereof within a reasonable time, not exceeding three (3) Trading Days after
      such
      exercise (the “Delivery
      Date”)
      or, at
      the request of the Holder (provided that a registration statement under the
      Securities Act providing for the resale of the Warrant Stock is then in effect),
      issued and delivered to the Depository Trust Company (“DTC”)
      account on the Holder’s behalf via the Deposit Withdrawal Agent Commission
      System (“DWAC”)
      within
      a reasonable time, not exceeding three (3) Trading Days after such exercise,
      and
      the Holder hereof shall be deemed for all purposes to be the holder of the
      shares of Warrant Stock so purchased as of the date of such exercise.
      Notwithstanding the foregoing to the contrary, the Issuer or its transfer agent
      shall only be obligated to issue and deliver the shares to the DTC on a holder’s
      behalf via DWAC if (i) such exercise is in connection with a sale, (ii)
      such
      shares may be issued without restrictive legends and (iii) the Issuer and the
      transfer agent are participating in DTC through the DWAC system. If all of
      the
      conditions set forth in clauses (i), (ii) and (iii) above are not satisfied,
      the
      transfer agent shall deliver physical certificates representing the shares
      of
      Warrant Stock to such Holder. The
      Holder shall deliver this original Warrant, or an indemnification undertaking
      with respect to such Warrant in the case of its loss, theft or destruction,
      at
      such time that this Warrant is fully exercised. With respect to partial
      exercises of this Warrant, the Issuer shall keep written records for the Holder
      of the number of shares of Warrant Stock exercised as of each date of
      exercise.

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    

    (e) Compensation
      for Buy-In on Failure to Timely Deliver Certificates Upon
      Exercise.
      In
      addition to any other rights available to the Holder, if the Issuer fails to
      cause its transfer agent to transmit to the Holder a certificate or certificates
      representing the Warrant Stock pursuant to an exercise on or before the Delivery
      Date, and if after such date the Holder is required by its broker to purchase
      (in an open market transaction or otherwise) shares of Common Stock to deliver
      in satisfaction of a sale by the Holder of the Warrant Stock which the Holder
      anticipated receiving upon such exercise (a “Buy-In”),
      then
      the Issuer shall (1) pay in cash to the Holder the amount by which (x) the
      Holder’s total purchase price (including brokerage commissions, if any) for the
      shares of Common Stock so purchased exceeds (y) the amount obtained by
      multiplying (A) the number of shares of Warrant Stock that the Issuer was
      required to deliver to the Holder in connection with the exercise at issue
      times
      (B) the price at which the sell order giving rise to such purchase obligation
      was executed, and (2) deliver to the Holder the number of shares of Common
      Stock
      that would have been issued had the Issuer timely complied with its exercise
      and
      delivery obligations hereunder. For example, if the Holder purchases Common
      Stock having a total purchase price of $11,000 to cover a Buy-In with respect
      to
      an attempted exercise of shares of Common Stock with an aggregate sale price
      giving rise to such purchase obligation of $10,000, under clause (1) of the
      immediately preceding sentence the Issuer shall be required to pay the Holder
      $1,000. The Holder shall provide the Issuer written notice indicating the
      amounts payable to the Holder in respect of the Buy-In, together with applicable
      confirmations and other evidence reasonably requested by the Issuer. Nothing
      herein shall limit a Holder’s right to pursue any other remedies available to it
      hereunder, at law or in equity including, without limitation, a decree of
      specific performance and/or injunctive relief with respect to the Issuer’s
      failure to timely deliver certificates representing shares of Common Stock
      upon
      exercise of this Warrant as required pursuant to the terms hereof.

     

    (f) Transferability
      of Warrant.
      Subject
      to Section 2(h) hereof, this Warrant may be transferred by a Holder, in whole
      or
      in part, without the consent of the Issuer. If transferred pursuant to this
      paragraph, this Warrant may be transferred on the books of the Issuer by the
      Holder hereof in person or by duly authorized attorney, upon surrender of this
      Warrant at the principal office of the Issuer, properly endorsed (by the Holder
      executing an assignment in the form attached hereto) and upon payment of any
      necessary transfer tax or other governmental charge imposed upon such transfer.
      This Warrant is exchangeable at the principal office of the Issuer for Warrants
      to purchase the same aggregate number of shares of Warrant Stock, each new
      Warrant to represent the right to purchase such number of shares of Warrant
      Stock as the Holder hereof shall designate at the time of such exchange. All
      Warrants issued on transfers or exchanges shall be dated the Original Issue
      Date
      and shall be identical with this Warrant except as to the number of shares
      of
      Warrant Stock issuable pursuant thereto.

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    

    

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

    

    (h) Compliance
      with Securities Laws.

    

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

    

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

    

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

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    

    

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

    

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

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    

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

    

    (a) Stock
      Fully Paid.
      The
      Issuer represents, warrants, covenants and agrees that all shares of Warrant
      Stock which may be issued upon the exercise of this Warrant or otherwise
      hereunder will, when issued in accordance with the terms of this Warrant, be
      duly authorized, validly issued, fully paid and non-assessable and free from
      all
      taxes, liens and charges created by or through the Issuer. The Issuer further
      covenants and agrees that during the period within which this Warrant may be
      exercised, the Issuer will at all times have authorized and reserved for the
      purpose of the issuance upon exercise of this Warrant a number of authorized
      but
      unissued shares of Common Stock equal to at least one hundred twenty (120%)
      of
      the number of shares of Common Stock issuable upon exercise of this Warrant
      without regard to any limitations on exercise.

    

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

    

    (c) Covenants.
      The
      Issuer shall not by any action including, without limitation, amending the
      Articles of Incorporation or the by-laws of the Issuer, or through any
      reorganization, transfer of assets, consolidation, merger, dissolution, issue
      or
      sale of securities or any other action, avoid or seek to avoid the observance
      or
      performance of any of the terms of this Warrant, but will at all times in good
      faith assist in the carrying out of all such terms and in the taking of all
      such
      actions as may be necessary or appropriate to protect the rights of the Holder
      hereof against dilution (to the extent specifically provided herein) or
      impairment. Without limiting the generality of the foregoing, the Issuer will
      (i) not permit the par value, if any, of its Common Stock to exceed the then
      effective Warrant Price, (ii) not amend or modify any provision of the Articles
      of Incorporation or by-laws of the Issuer in any manner that would adversely
      affect the rights of the Holders of the Warrants, (iii) take all such action
      as
      may be reasonably necessary in order that the Issuer may validly and legally
      issue fully paid and nonassessable shares of Common Stock, free and clear of
      any
      liens, claims, encumbrances and restrictions (other than as provided herein)
      upon the exercise of this Warrant, and (iv) use its best efforts to obtain
      all
      such authorizations, exemptions or consents from any public regulatory body
      having jurisdiction thereof as may be reasonably necessary to enable the Issuer
      to perform its obligations under this Warrant.

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    

    

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

    

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

    

    4. Adjustment
      of Warrant Price and Number of Shares Issuable Upon Exercise.
      The
      Warrant Price and the number of shares of Warrant Stock that may be purchased
      upon exercise of this Warrant shall be subject to adjustment from time to time
      as set forth in this Section 4. The Issuer shall give the Holder notice of
      any
      event described below which requires an adjustment pursuant to this Section
      4 in
      accordance with the notice provisions set forth in Section 5.

    

    (a) Recapitalization,
      Reorganization, Reclassification, Consolidation, Merger or Sale.

     

    (i)
      In
      case the Issuer after the Original Issue Date shall do any of the following
      (each, a "Triggering
      Event"):
      (a)
      consolidate or merge with or into any other Person and the Issuer shall not
      be
      the continuing or surviving corporation of such consolidation or merger, or
      (b)
      permit any other Person to consolidate with or merge into the Issuer and the
      Issuer shall be the continuing or surviving Person but, in connection with
      such
      consolidation or merger, any Capital Stock of the Issuer shall be changed into
      or exchanged for Securities of any other Person or cash or any other property,
      or (c) transfer all or substantially all of its properties or assets to any
      other Person, or (d) effect a capital reorganization or reclassification of
      its
      Capital Stock, then, and in the case of each such Triggering Event, proper
      provision shall be made to the Warrant Price and the number of shares of Warrant
      Stock that may be purchased upon exercise of this Warrant so that, upon the
      basis and the terms and in the manner provided in this Warrant, the Holder
      of
      this Warrant shall be entitled upon the exercise hereof at any time after the
      consummation of such Triggering Event, to the extent this Warrant is not
      exercised prior to such Triggering Event, to receive at the Warrant Price as
      adjusted to take into account the consummation of such Triggering Event, in
      lieu
      of the Common Stock issuable upon such exercise of this Warrant prior to such
      Triggering Event, the Securities, cash and property to which such Holder would
      have been entitled upon the consummation of such Triggering Event if such Holder
      had exercised the rights represented by this Warrant immediately prior thereto
      (including the right of a shareholder to elect the type of consideration it
      will
      receive upon a Triggering Event), subject to adjustments (subsequent to such
      corporate action) as nearly equivalent as possible to the adjustments provided
      for elsewhere in this Section 4. Immediately upon the occurrence of a Triggering
      Event, the Issuer shall notify the Holder in writing of such Triggering Event
      and provide the calculations in determining the number of shares of Warrant
      Stock issuable upon exercise of the new warrant and the adjusted Warrant Price.
      Upon the Holder’s request, the continuing or surviving corporation as a result
      of such Triggering Event shall issue to the Holder a new warrant of like tenor
      evidencing the right to purchase the adjusted number of shares of Warrant Stock
      and the adjusted Warrant Price pursuant to the terms and provisions of this
      Section 4(a)(i). 

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    

    

    (ii) In
      the
      event that the Holder has elected not to exercise this Warrant prior to the
      consummation of a Triggering Event, so long as the surviving entity pursuant
      to
      any Triggering Event is a company that has a class of equity securities
registered
      pursuant to the Securities Exchange Act of 1934, as amended, and its common
      stock is listed or quoted on a national securities exchange, national automated
      quotation system or the OTC Bulletin Board,
      the
      surviving entity and/or each Person (other than the Issuer) which may be
      required to deliver any Securities, cash or property upon the exercise of this
      Warrant as provided herein shall assume, by written instrument delivered to,
      and
      reasonably satisfactory to, the Holder of this Warrant, (A) the obligations
      of
      the Issuer under this Warrant (and if the Issuer shall survive the consummation
      of such Triggering Event, such assumption shall be in addition to, and shall
      not
      release the Issuer from, any continuing obligations of the Issuer under this
      Warrant) and (B) the obligation to deliver to such Holder such Securities,
      cash
      or property as, in accordance with the foregoing provisions of this subsection
      (a), such Holder shall be entitled to receive, and the surviving entity and/or
      each such Person shall have similarly delivered to such Holder an opinion of
      counsel for the surviving entity and/or each such Person, which counsel shall
      be
      reasonably satisfactory to such Holder, or in the alternative, a written
      acknowledgement executed by the President or Chief Financial Officer of the
      Issuer, stating that this Warrant shall thereafter continue in full force and
      effect and the terms hereof (including, without limitation, all of the
      provisions of this subsection (a)) shall be applicable to the Securities, cash
      or property which the surviving entity and/or each such Person may be required
      to deliver upon any exercise of this Warrant or the exercise of any rights
      pursuant hereto. 

    

    (b) Stock
      Dividends, Subdivisions and Combinations.
      If at
      any time the Issuer shall:

    

       (i) make
      or
      issue or set a record date for the holders of the Common Stock for the purpose
      of entitling them to receive a dividend payable in, or other distribution of,
      shares of Common Stock, 

    

       (ii)
       subdivide
      its outstanding shares of Common Stock into a larger number of shares of Common
      Stock, or

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    

       (iii)
       combine
      its outstanding shares of Common Stock into a smaller number of shares of Common
      Stock,

    

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      immediately after the occurrence of any such event shall be adjusted to equal
      the number of shares of Common Stock which a record holder of the same number
      of
      shares of Common Stock for which this Warrant is exercisable immediately prior
      to the occurrence of such event would own or be entitled to receive after the
      happening of such event, and (2) the Warrant Price then in effect shall be
      adjusted to equal (A) the Warrant Price then in effect multiplied by the number
      of shares of Common Stock for which this Warrant is exercisable immediately
      prior to the adjustment divided by (B) the number of shares of Common Stock
      for
      which this Warrant is exercisable immediately after such
      adjustment.

    

    (c) Certain
      Other Distributions.
      If at
      any time the Issuer shall make or issue or set a record date for the holders
      of
      the Common Stock for the purpose of entitling them to receive any dividend
      or
      other distribution of:

    

    (i) cash,

    

    (ii) any
      evidences of its indebtedness, any shares of stock of any class or any other
      securities or property of any nature whatsoever (other than cash, Common Stock
      Equivalents or Additional Shares of Common Stock), or

    

    (iii) any
      warrants or other rights to subscribe for or purchase any evidences of its
      indebtedness, any shares of stock of any class or any other securities or
      property of any nature whatsoever (other than cash, Common Stock Equivalents
      or
      Additional Shares of Common Stock), 

    

    then
      (1)
      the number of shares of Common Stock for which this Warrant is exercisable
      shall
      be adjusted to equal the product of the number of shares of Common Stock for
      which this Warrant is exercisable immediately prior to such adjustment
      multiplied by a fraction (A) the numerator of which shall be the Per Share
      Market Value of Common Stock at the date of taking such record and (B) the
      denominator of which shall be such Per Share Market Value minus the amount
      allocable to one share of Common Stock of any such cash so distributable and
      of
      the fair value (as determined in good faith by the Board of Directors of the
      Issuer and supported by an opinion from an investment banking firm mutually
      agreed upon by the Issuer and the Holder) of any and all such evidences of
      indebtedness, shares of stock, other securities or property or warrants or
      other
      subscription or purchase rights so distributable, and (2) the Warrant Price
      then
      in effect shall be adjusted to equal (A) the Warrant Price then in effect
      multiplied by the number of shares of Common Stock for which this Warrant is
      exercisable immediately prior to the adjustment divided by (B) the number of
      shares of Common Stock for which this Warrant is exercisable immediately after
      such adjustment. A reclassification of the Common Stock (other than a change
      in
      par value, or from par value to no par value or from no par value to par value)
      into shares of Common Stock and shares of any other class of stock shall be
      deemed a distribution by the Issuer to the holders of its Common Stock of such
      shares of such other class of stock within the meaning of this Section 4(c)
      and,
      if the outstanding shares of Common Stock shall be changed into a larger or
      smaller number of shares of Common Stock as a part of such reclassification,
      such change shall be deemed a subdivision or combination, as the case may be,
      of
      the outstanding shares of Common Stock within the meaning of Section
      4(b). 

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    

    

    (d) Issuance
      of Additional Shares of Common Stock.
      

    

    (i) In
      the
      event the Issuer shall issue any Additional Shares of Common Stock (otherwise
      than as provided in the foregoing subsections (a) through (c) of this Section
      4), at a price per share less than the Warrant Price then in effect or without
      consideration, then the Warrant Price upon each such issuance shall be adjusted
      to that price determined by multiplying the Warrant Price then in effect by
      a
      fraction:

     

    (A) the
      numerator of which shall be equal to the sum of (x) the number of shares of
      Outstanding Common Stock immediately prior to the issuance of such Additional
      Shares of Common Stock plus
      (y) the
      number of shares of Common Stock (rounded to the nearest whole share) which
      the
      aggregate consideration for the total number of such Additional Shares of Common
      Stock so issued would purchase at a price per share equal to the Warrant Price
      then in effect, and

     

    (B) the
      denominator of which shall be equal to the number of shares of Outstanding
      Common Stock immediately after the issuance of such Additional Shares of Common
      Stock.

    

    (ii) No
      adjustment of the number of shares of Common Stock for which this Warrant shall
      be exercisable shall be made under paragraph (i) of Section 4(d) upon the
      issuance of any Additional Shares of Common Stock which are issued pursuant
      to
      the exercise of any Common Stock Equivalents, if any such adjustment shall
      previously have been made upon the issuance of such Common Stock Equivalents
      (or
      upon the issuance of any warrant or other rights therefor) pursuant to Section
      4(e).

     

    (e) Issuance
      of Common Stock Equivalents.
      In the
      event the Issuer shall at any time following the Original Issue Date take a
      record of the holders of its Common Stock for the purpose of entitling them
      to
      receive a distribution of, or shall in any manner (whether directly or by
      assumption in a merger in which the Issuer is the surviving corporation) issue
      or sell, any Common Stock Equivalents, whether or not the rights to exchange
      or
      convert thereunder are immediately exercisable, and the price per share for
      which Common Stock is issuable upon such conversion or exchange shall be less
      than the Warrant Price in effect immediately prior to the time of such issue
      or
      sale, or if, after any such issuance of Common Stock Equivalents, the price
      per
      share for which Additional Shares of Common Stock may be issuable thereafter
      is
      amended or adjusted, and such price as so amended shall be less than the Warrant
      Price in effect at the time of such amendment or adjustment, then the Warrant
      Price then in effect shall be adjusted as provided in Section 4(d). No further
      adjustments of the number of shares of Common Stock for which this Warrant
      is
      exercisable and the Warrant Price then in effect shall be made upon the actual
      issue of such Common Stock upon conversion or exchange of such Common Stock
      Equivalents.

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    

    

    (f) Other
      Provisions applicable to Adjustments under this Section.
      The
      following provisions shall be applicable to the making of adjustments of the
      number of shares of Common Stock for which this Warrant is exercisable and
      the
      Warrant Price then in effect provided for in this Section 4:

    

    (i) Computation
      of Consideration.
      To the
      extent that any Additional Shares of Common Stock or any Common Stock
      Equivalents (or any warrants or other rights therefor) shall be issued for
      cash
      consideration, the consideration received by the Issuer therefor shall be the
      amount of the cash received by the Issuer therefor, or, if such Additional
      Shares of Common Stock or Common Stock Equivalents are offered by the Issuer
      for
      subscription, the subscription price, or, if such Additional Shares of Common
      Stock or Common Stock Equivalents are sold to underwriters or dealers for public
      offering without a subscription offering, the initial public offering price
      (in
      any such case subtracting any amounts paid or receivable for accrued interest
      or
      accrued dividends and without taking into account any compensation, discounts
      or
      expenses paid or incurred by the Issuer for and in the underwriting of, or
      otherwise in connection with, the issuance thereof). In connection with any
      merger or consolidation in which the Issuer is the surviving corporation (other
      than any consolidation or merger in which the previously outstanding shares
      of
      Common Stock of the Issuer shall be changed to or exchanged for the stock or
      other securities of another corporation), the amount of consideration therefore
      shall be, deemed to be the fair value, as determined reasonably and in good
      faith by the Board, of such portion of the assets and business of the
      nonsurviving corporation as the Board may determine to be attributable to such
      shares of Common Stock or Common Stock Equivalents, as the case may be. The
      consideration for any Additional Shares of Common Stock issuable pursuant to
      any
      warrants or other rights to subscribe for or purchase the same shall be the
      consideration received by the Issuer for issuing such warrants or other rights
      plus the additional consideration payable to the Issuer upon exercise of such
      warrants or other rights. The consideration for any Additional Shares of Common
      Stock issuable pursuant to the terms of any Common Stock Equivalents shall
      be
      the consideration received by the Issuer for issuing warrants or other rights
      to
      subscribe for or purchase such Common Stock Equivalents, plus the consideration
      paid or payable to the Issuer in respect of the subscription for or purchase
      of
      such Common Stock Equivalents, plus the additional consideration, if any,
      payable to the Issuer upon the exercise of the right of conversion or exchange
      in such Common Stock Equivalents. In the event of any consolidation or merger
      of
      the Issuer in which the Issuer is not the surviving corporation or in which
      the
      previously outstanding shares of Common Stock of the Issuer shall be changed
      into or exchanged for the stock or other securities of another corporation,
      or
      in the event of any sale of all or substantially all of the assets of the Issuer
      for stock or other securities of any corporation, the Issuer shall be deemed
      to
      have issued a number of shares of its Common Stock for stock or securities
      or
      other property of the other corporation computed on the basis of the actual
      exchange ratio on which the transaction was predicated, and for a consideration
      equal to the fair market value on the date of such transaction of all such
      stock
      or securities or other property of the other corporation. In the event any
      consideration received by the Issuer for any securities consists of property
      other than cash, the fair market value thereof at the time of issuance or as
      otherwise applicable shall be as determined in good faith by the Board. In
      the
      event Common Stock is issued with other shares or securities or other assets
      of
      the Issuer for consideration which covers both, the consideration computed
      as
      provided in this Section 4(f)(i) shall be allocated among such securities and
      assets as determined in good faith by the Board.

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    

    

    (ii) When
      Adjustments to Be Made.
      The
      adjustments required by this Section 4 shall be made whenever and as often
      as
      any specified event requiring an adjustment shall occur, except that any
      adjustment of the number of shares of Common Stock for which this Warrant is
      exercisable that would otherwise be required may be postponed (except in the
      case of a subdivision or combination of shares of the Common Stock, as provided
      for in Section 4(b)) up to, but not beyond the date of exercise if such
      adjustment either by itself or with other adjustments not previously made adds
      or subtracts less than one percent (1%) of the shares of Common Stock for which
      this Warrant is exercisable immediately prior to the making of such adjustment.
      Any adjustment representing a change of less than such minimum amount (except
      as
      aforesaid) which is postponed shall be carried forward and made as soon as
      such
      adjustment, together with other adjustments required by this Section 4 and
      not
      previously made, would result in a minimum adjustment or on the date of
      exercise. For the purpose of any adjustment, any specified event shall be deemed
      to have occurred at the close of business on the date of its
      occurrence.

    

    (iii) Fractional
      Interests.
      In
      computing ad-justments under this Section 4, fractional interests in Common
      Stock shall be taken into account to the near-est one one-hundredth
      (1/100th)
      of a
      share.

    

    (iv) When
      Adjustment Not Required.
      If the
      Issuer shall take a record of the holders of its Common Stock for the purpose
      of
      entitling them to receive a dividend or distribution or subscription or purchase
      rights and shall, thereafter and before the distribution to stockholders
      thereof, legally abandon its plan to pay or deliver such dividend, distribution,
      subscription or purchase rights, then thereafter no adjustment shall be required
      by reason of the taking of such record and any such adjustment previously made
      in respect thereof shall be rescinded and annulled.

     

    (g) Form
      of Warrant after Adjustments.
      The
      form of this Warrant need not be changed because of any adjustments in the
      Warrant Price or the number and kind of Securities purchasable upon the exercise
      of this Warrant.

    

    (h) Escrow
      of Warrant Stock.
      If
      after any property becomes distributable pursuant to this Section 4 by reason
      of
      the taking of any record of the holders of Common Stock, but prior to the
      occurrence of the event for which such record is taken, and the Holder
      exer-cises this Warrant, any shares of Common Stock issuable upon exercise
      by
      reason of such adjustment shall be deemed the last shares of Common Stock for
      which this Warrant is exercised (notwithstanding any other provision to the
      contrary herein) and such shares or other property shall be held in escrow
      for
      the Holder by the Issuer to be issued to the Holder upon and to the extent
      that
      the event actually takes place, upon payment of the current Warrant Price.
      Notwithstanding any other provision to the contrary herein, if the event for
      which such record was taken fails to occur or is rescinded, then such escrowed
      shares shall be cancelled by the Issuer and escrowed property
      returned.

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    

    

    5. Notice
      of Adjustments; Dispute Resolution.
      Whenever the Warrant Price or Warrant Share Number shall be adjusted pursuant
      to
      Section 4 hereof (for purposes of this Section 5, each an "adjustment"),
      the
      Issuer shall cause its Chief Financial Officer to prepare and execute a
      certificate setting forth, in reasonable detail, the event requiring the
      adjustment, the amount of the adjustment, the method by which such adjustment
      was calculated (including a description of the basis on which the Board made
      any
      determination hereunder), and the Warrant Price and Warrant Share Number after
      giving effect to such adjustment, and shall cause copies of such certificate
      to
      be delivered to the Holder of this Warrant promptly after each adjustment.
      Any
      dispute between the Issuer and the Holder of this Warrant with respect to the
      matters set forth in such certificate may at the option of the Holder of this
      Warrant be submitted to a national or regional accounting firm reasonably
      acceptable to the Issuer and the Holder, provided
      that the
      Issuer shall have three (3) business days after receipt of notice from such
      Holder of its selection of such firm to object thereto, in which case such
      Holder shall select another such firm and the Issuer shall have no such right
      of
      objection. The firm selected by the Holder of this Warrant as provided in the
      preceding sentence shall be instructed to deliver a written opinion as to such
      matters to the Issuer and such Holder within ten (10) days after submission
      to
      it of such dispute. Such opinion shall be final and binding on the parties
      hereto. The costs and expenses of the initial accounting firm shall be paid
      equally by the Issuer and the Holder and, in the case of an objection by the
      Issuer, the costs and expenses of the subsequent accounting firm shall be paid
      in full by the Issuer. Notwithstanding the foregoing to the contrary, the Issuer
      shall cause its transfer agent to promptly issue to the Holder the number of
      shares of Warrant Stock that is not disputed in accordance with the terms of
      this Section 5. 

    

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

    

    7. Ownership
      Cap and Exercise Restriction.
      Notwithstanding anything to the contrary set forth in this Warrant, at no time
      may a Holder of this Warrant exercise this Warrant if the number of shares
      of
      Common Stock to be issued pursuant to such exercise would exceed, when
      aggregated with all other shares of Common Stock owned by such Holder at such
      time, the number of shares of Common Stock which would result in such Holder
      beneficially owning (as determined in accordance with Section 13(d) of the
      Exchange Act and the rules thereunder) in excess of 9.9% of the then issued
      and
      outstanding shares of Common Stock;
      provided,
      however,
      that
      upon a holder of this Warrant providing the Issuer with sixty-one (61) days
      notice (pursuant to Section 12 hereof) (the "Waiver
      Notice")
      that
      such Holder would like to waive this Section 7 with regard to any or all shares
      of Common Stock issuable upon exercise of this Warrant, this Section 7 will
      be
      of no force or effect with regard to all or a portion of the Warrant referenced
      in the Waiver Notice; provided,
      further,
      that
      this provision shall be of no further force or effect during the sixty-one
      (61)
      days immediately preceding the expiration of the term of this
      Warrant.

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    

    8. Issuer's
      Redemption Option.
      At any
      time following the effective date of the registration
      statement (the
      “Registration
      Statement”)
      filed
      by the Issuer with the Securities and Exchange Commission providing for the
      resale of the Warrant Stock and the shares of Common Stock issuable upon
      conversion of the Series B Convertible Preferred Stock, if
      the
      trading volume of the Common Stock for
      any
      fifteen (15) consecutive Trading Days (the “Target
      Period”)
      equals
      or
      exceeds $1,000,000,
      the
      Issuer may, at any time within fifteen (15) Trading Days of the last Trading
      Day
      of the Target Period, and upon fifteen (15) Trading Days prior written notice
      (the “Issuer
      Redemption Notice”)
      to the
      Holder, redeem the unexercised portion of this Warrant in cash at a price equal
      to the product of (A) two hundred fifty percent (250%) of the Warrant Price
      on
      the Original Issue Date, multiplied by (B) the number of shares of Warrant
      Stock
      with respect to the unexercised portion of this Warrant (the “Issuer
      Redemption Price”);
      provided,
      that,
      in
      connection with any redemption by the Issuer under this Section 8, (A) the
      Registration
      Statement is
      then
      in effect,
      (B)
      trading in the Common Stock shall not have been suspended by the Securities
      and
      Exchange Commission or the OTC Bulletin Board (or other exchange or market
      on
      which the Common Stock is trading), (C) the Issuer is in material compliance
      with the terms and conditions of this Warrant and the Registration Rights
      Agreement and (D) the Issuer is not in possession of any material non-public
      information;
      provided, further, that the Registration Statement is in effect from the date
      of
      delivery of the Issuer Redemption Notice until the date which is the later
      of
      (1) the date the Holder exercises the Warrant pursuant to the Issuer Redemption
      Notice and (2) the fifteenth (15th)
      Trading
      Day after the Holder receives the Issuer Redemption Notice (the "Early
      Termination Date").
      The
      rights and privileges granted pursuant to this Warrant with respect to the
      shares of Warrant Stock subject to the Issuer Redemption Notice (the
      "Redeemed
      Warrant Shares")
      shall
      expire on the Early Termination Date if this Warrant is not exercised with
      respect to such Redeemed Warrant Shares prior to such Early Termination Date.
      The
      Issuer's Redemption Notice shall state the date of redemption which date shall
      be the sixteenth (16th)
      Trading
      Day after the Issuer has delivered the Issuer's Redemption Notice (the
      "Issuer’s
      Redemption Date"),
      the
      Issuer's Redemption Price and the number of shares to be redeemed by the Issuer.
      The Issuer shall not send a Issuer's Redemption Notice unless it has good and
      clear funds for a minimum of the amount it intends to redeem in a bank account
      controlled by the Issuer. The Issuer shall deliver the Issuer's Redemption
      Price
      to the Holder on the Issuer’s Redemption Date. Not later than five (5) days
      after receipt of the Issuer Redemption Price, Holder shall return to the Issuer
      for cancellation the original Warrant to be redeemed. If the Issuer fails to
      pay
      the Issuer’s Redemption Price by the Issuer’s Redemption Date, the redemption
      will be declared null and void. Notwithstanding
      anything in the foregoing to the contrary, if the Holder may not exercise this
      Warrant as a result of the restriction contained in Section 7 hereof, the Issuer
      Redemption Notice shall be deemed automatically amended to apply only to such
      portion of this Warrant as may be exercised by the Holder in accordance with
      such Section as then in effect. 

    

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

    

    "Additional
      Shares of Common Stock"
      means
      all shares of Common Stock issued by the Issuer after the Original Issue Date,
      and all shares of Other Common, if any, issued by the Issuer after the Original
      Issue Date, except: (i) securities issued (other than for cash) in connection
      with a merger, acquisition, or consolidation, (ii) securities issued pursuant
      to
      the conversion or exercise of convertible or exercisable securities issued
      or
      outstanding on or prior to the Series A Preferred Original Issue Date (so long
      as the conversion or exercise price in such securities are not amended to lower
      such price and/or adversely affect the Holders) as set forth on Schedule 1.2
      to
      that certain Joinder Agreement executed by the Issuer, (iii) the Warrant Stock,
      (iv) securities issued in connection with bona fide strategic license agreements
      or other partnering arrangements so long as such issuances are not for the
      purpose of raising capital, (v) Common Stock issued or the issuance or grants
      of
      options to purchase Common Stock pursuant to the Issuer’s stock option plans and
      employee stock purchase plans (A) outstanding as they exist on the Series A
      Preferred Original Issue Date or (B) adopted after the Series A Preferred
      Original Issue Date provided such plans do not exceed 3,600,000 shares of Common
      Stock, and in each case approved by a majority of the Board, (vi) shares of
      Series B Preferred Stock issued to the Holders in connection with the
      transactions relating to the issuance of this Warrant and (vii) warrants to
      purchase up to 990,000 shares of Common Stock issued to any placement agent
      and
      its designees in connection with the transactions relating to the issuance
      of
      this Warrant.  

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    

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

    

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

    

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

    

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

    

    "Common
      Stock Equivalent"
      means
      any Convertible Security or warrant, option or other right to subscribe for
      or
      purchase any Additional Shares of Common Stock or any Convertible
      Security.

    

    "Convertible
      Securities"
      means
      evidences of Indebtedness, shares of Capital Stock or other Securities which
      are
      or may be at any time convertible into or exchangeable for Additional Shares
      of
      Common Stock. The term "Convertible Security" means one of the Convertible
      Securities.

    

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

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    

    

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

    

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

    

    "Issuer"
      means
      Jpak Group, Inc., a Nevada corporation, and its successors. 

    

    "Majority
      Holders"
      means
      at any time the Holders of Warrants exercisable for a majority of the shares
      of
      Warrant Stock issuable under the Warrants at the time outstanding.

    

    "Original
      Issue Date"
      means
      ________ __, 20__.

    

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

    

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

    

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

    

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

    

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

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    

    

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

    

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

    

    "Series
      A Preferred Original Issue Date"
      means
      August 9, 2007.

    

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

    

    "Term"
      has the
      meaning specified in Section 1 hereof.

    

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

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    

    

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

    

    "Warrants"
      means
      this Warrant and the other Warrants issued on the Original Issue Date, and
      any
      other warrants of like tenor issued in substitution or exchange for any thereof
      pursuant to the provisions of Section 2(c), 2(d) or 2(e) hereof or of any of
      such other Warrants. 

    

    "Warrant
      Price"
      initially means $0.84, as such price may be adjusted from time to time as shall
      result from the adjustments specified in this Warrant, including Section 4
      hereto.

    

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

    

    "Warrant
      Stock"
      means
      Common Stock issuable upon exercise of any Warrant or Warrants or otherwise
      issuable pursuant to any Warrant or Warrants.

    

    10. Other
      Notices.
      In case
      at any time:

    

    
      	 	
              (A)

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

            

    

    

    
      	 	
              (B)

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

            

    

    

    
      	 	
              (C)

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

            

    

    

    
      	 	
              (D)

            	
              there
                shall be any capital reorganization by the Issuer;
                or

            

    

    

    
      	 	
              (E)

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

            

    

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    

    

    
      	 	
              (F)

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

            

    

    

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

    

    11. Amendment
      and Waiver.
      Any
      term, covenant, agreement or condition in this Warrant may be amended, or
      compliance therewith may be waived (either generally or in a particular instance
      and either retroactively or prospectively), by a written instrument or written
      instruments executed by the Issuer and the Majority Holders; provided,
      however,
      that no
      such amendment or waiver shall reduce the Warrant Share Number, increase the
      Warrant Price, shorten the period during which this Warrant may be exercised
      or
      modify any provision of this Section 11 without the consent of the Holder of
      this Warrant. No consideration shall be offered or paid to any person to amend
      or consent to a waiver or modification of any provision of this Warrant unless
      the same consideration is also offered to all holders of the
      Warrants.

    

    12. Governing
      Law; Jurisdiction.
      This
      Warrant shall be governed by and construed in accordance with the internal
      laws
      of the State of New York, without giving effect to any of the conflicts of
      law
      principles which would result in the application of the substantive law of
      another jurisdiction. This Warrant shall not be interpreted or construed with
      any presumption against the party causing this Warrant to be drafted. The Issuer
      and the Holder agree that venue for any dispute arising under this Warrant
      will
      lie exclusively in the state or federal courts located in New York County,
      New
      York, and the parties irrevocably waive any right to raise forum
      non conveniens
      or any
      other argument that New York is not the proper venue. The Issuer and the Holder
      irrevocably consent to personal jurisdiction in the state and federal courts
      of
      the state of New York. The Issuer and the Holder consent to process being served
      in any such suit, action or proceeding by mailing a copy thereof to such party
      at the address in effect for notices to it under this Warrant and agrees that
      such service shall constitute good and sufficient service of process and notice
      thereof. Nothing in this Section 12 shall affect or limit any right to serve
      process in any other manner permitted by law. The Issuer and the Holder hereby
      agree that the prevailing party in any suit, action or proceeding arising out
      of
      or relating to this Warrant, shall be entitled to reimbursement for reasonable
      legal fees from the non-prevailing party. The parties hereby waive all rights
      to
      a trial by jury.

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    

    

    13. Notices.
      Any
      notice, demand, request, waiver or other communication required or permitted
      to
      be given hereunder shall be in writing and shall be effective (a) upon hand
      delivery by telecopy or facsimile at the address or number designated below
      (if
      delivered on a business day during normal business hours where such notice
      is to
      be received), or the first business day following such delivery (if delivered
      other than on a business day during normal business hours where such notice
      is
      to be received) or (b) on the second business day following the date of mailing
      by express courier service, fully prepaid, addressed to such address, or upon
      actual receipt of such mailing, whichever shall first occur. The addresses
      for
      such communications shall be:

    

      
        	
                If
                  to the Issuer:

              	
                Jpak
                  Group, Inc.

              
	 	
                c/o
                  Qingdao Renmin Printing Co., Ltd.

              
	 	
                No.
                  15, Xinghua Road

              
	 	
                Qingdao,
                  Shandong Province

              
	 	
                Postal
                  Code 266401

              
	 	
                P.R.
                  China

              
	 	
                Attention:
                  Mr. Yijun Wang

              
	 	
                Tel.
                  No.: (532) 8463 0577

              
	 	
                Fax
                  No.: (532) 8463 0586

              
	 	 
	
                with
                  copies (which copies 

              	 
	
                shall
                  not constitute notice) 

              	 
	
                to:         

              	
                Lowenstein
                  Sandler PC

              
	 	
                65
                  Livingston Avenue

              
	 	
                Roseland,
                  New Jersey 07086

              
	 	
                Attention:
                  Steven M. Skolnick

              
	 	
                Tel
                  No.: (973) 597-2500

              
	 	
                Fax
                  No.: (973) 597-2400

              
	 	 
	
                If
                  to any Holder: At
                  the address of such Holder as specified in writing by such
                  Holder.

              
	 	 
	
                with
                  copies (which copies 

              	 
	
                shall
                  not constitute notice) 

              	 
	
                to:

              	
                Kramer
                  Levin Naftalis & Frankel LLP

              
	 	
                1177
                  Avenue of the Americas

              
	 	
                New
                  York, New York 10036

              
	 	
                Attention:
                  Christopher S. Auguste

              
	 	
                Tel.
                  No.: (212) 715-9100

              
	 	
                Fax
                  No.: (212) 715-8000

              

      

    

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    

    

    Any
      party
      hereto may from time to time change its address for notices by giving written
      notice of such changed address to the other party hereto.

     

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

    

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

    

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

    

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

    

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

    

    19. Demand
      Registration Rights.
      The
      Holder hereof shall have demand registration rights with respect to all
      of
      its shares of Common Stock issuable upon exercise of this Warrant as provided
      in
      the Series J Warrant issued to the Holder on August 9, 2007. The Issuer and
      the
      Holder agree that, with respect to such demand registration rights, each party
      shall be entitled to all of the applicable rights and benefits, and subject
      to
      all of the applicable obligations, as set forth in the Registration Rights
      Agreement dated as of August 9, 2007 by and among the Issuer and the purchasers
      named therein.

    

    

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK]

    

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

    

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

    

    

    
      	 	
              JPAK
                GROUP, INC.

            
	 	 	 
	 	 	 
	 	
              By:
                

            	
               
                

            
	 	 	
              Name:
                

            
	 	 	
              Title:
                

            

    

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

    EXERCISE
      FORM

    SERIES
      D
      WARRANT

    

    JPAK
      GROUP, INC.

    

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

    

    
      	
              Dated:
                _________________

            	 	
              Signature

            	
              ___________________________

            
	 	 	 	 
	 	 	
              Address

            	
              _____________________

            
	 	 	 	
              _____________________

            
	 	 	 	 

    

     

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

    

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

     

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

     

    Cash
      Exercise_______ 

     

    Cashless
      Exercise_______

     

    If
      the
      Holder has elected a Cash Exercise, the Holder shall pay the sum of $________
      by
      wire transfer to the Issuer in accordance with the terms of the Warrant.

     

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

     

    X
      = Y -
(A)(Y)

    B

    

    Where: 

    

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

    

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

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

    

    

    The
      Warrant Price ______________ (“A”). 

    

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

    

    

    ASSIGNMENT

    

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

    

    
      
        	
                Dated:
                  _________________

              	 	
                Signature

              	
                ___________________________

              
	 	 	 	 
	 	 	
                Address

              	
                _____________________

              
	 	 	 	
                _____________________

              
	 	 	 	 

      

    

    PARTIAL
      ASSIGNMENT

    

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

    

    
      
        	
                Dated:
                  _________________

              	 	
                Signature

              	
                ___________________________

              
	 	 	 	 
	 	 	
                Address

              	
                _____________________

              
	 	 	 	
                _____________________

              
	 	 	 	 

      

    

    FOR
      USE
      BY THE ISSUER ONLY:

    

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

    

    
      
        
        

      

      
        -24-Unassociated Document

    

    NOTE
      PURCHASE AGREEMENT

    

    NOTE
      PURCHASE AGREEMENT (this
      “Agreement”), dated as of May 17, 2007, is by and among Jpak Group Co., Ltd., a
      company organized under the laws of the Cayman Islands (the “Company”), Grand
      International Industrial Limited, a company organized under the laws of Hong
      Kong (“Grand International”), and each investor identified on the signature
      pages hereto (individually, an “Investor” and, collectively, the
“Investors”).

    

    Recitals

    

    A. The
      Investors wish to purchase, and the Company wishes to sell to the Investors,
      upon the terms and subject to the conditions stated in this Agreement, an
      aggregate of US$5,500,000 in principal amount of Senior Secured Convertible
      Notes in the form attached hereto as Exhibit
      A
      (a
“Note” and, collectively, the “Notes”). The Notes shall have an issue price of
      US$500,000 per Note.

    

    B. The
      Company intends to enter into a reverse merger or share exchange transaction
      (the
      “Acquisition”) with
      a
      company filing periodic reports with the Securities and Exchange Commission
      (the
“Public
      Shell”;
      provided, that the Public Shell shall be RX Staffing, Inc. for $400,000 and
      shares of common stock representing 5% of the outstanding common stock of the
      Surviving Company (calculated in the same manner as the determination of the
      Conversion Rate set forth in Section 3(b) of the Note) so long as the Company’s
      counsel is satisfied with its due diligence review of RX Staffing, Inc. in
      its
      sole determination) and, simultaneously with the closing of such Acquisition,
      the surviving company in such Acquisition (the “Surviving Company”) will issues
      shares of convertible preferred stock (the “Surviving Company Shares”) and
      warrants to purchase common stock (the “Surviving Company Warrants”) to the
      Investors in accordance with the terms of the Notes. The terms of the Surviving
      Company Shares and Surviving Company Warrants are substantially as set forth
      on
Exhibit
      B
      attached
      hereto. The Surviving Company shall assume in writing the Company’s obligations
      under this Agreement and the other Transaction Documents following the
      Acquisition.

    

    C. The
      Notes
      will be convertible under certain conditions into such number of Surviving
      Company Shares and Surviving Company Warrants as is necessary to provide the
      Investors with a 30.56% ownership interest in the Surviving Company post-closing
      of the Acquisition based upon the number of shares of common stock of the
      Surviving Company issuable upon conversion of the Surviving Company Shares
      and
      all other securities convertible into or exercisable for common stock of the
      Surviving Company, but not including the Surviving Company Warrants held by
      the
      Investors.

    

    D. The
      Company owns all of the issued and outstanding capital stock of Grand
      International (the “Grand International Shares”) and Grand International owns
      approximately 88.23% of the issued and outstanding capital stock of Qingdao
      Renmin Printing Co., Ltd., a company organized under the laws of the Peoples
      Republic of China (“Renmin”).

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    

    E. The
      Company has agreed to secure its obligations under the Notes by granting to
      the
      Investors (and any subsequent holders of the Notes) a duly perfected first
      priority security interest in all of the Grand International Shares held by
      the
      Company. In order to evidence the grant of such security interest,
      contemporaneous with the sale of the Notes, the Company will execute and deliver
      to the Investors a Stock Pledge Agreement, in the form attached hereto as
Exhibit
      C
      (the
“Pledge Agreement”), and related documents and will take all other action deemed
      by the Investors as necessary or advisable in relation thereto.

    

    F. The
      sale
      of the Notes to the Investors will be effected in reliance upon the exemption
      from securities registration afforded by Section 4(2) of the Securities Act
      (as
      defined below) and Rule 506 of Regulation D (“Regulation D”) as promulgated by
      the Securities and Exchange Commission (the “Commission”) under the Securities
      Act.

    

    NOW,
      THEREFORE, in consideration of the mutual promises made herein and other good
      and valuable consideration, the receipt and sufficiency of which are hereby
      acknowledged,

     

    1. Definitions.
      In
      addition to those terms defined above and elsewhere in this Agreement, for
      the
      purposes of this Agreement, the following terms shall have the meanings set
      forth below:

    

    “Affiliate”
means,
      with respect to any Person, any other Person which directly or indirectly
      through one or more intermediaries Controls, is controlled by, or is under
      common control with, such Person. For the avoidance of doubt, with respect
      to an
      Investor which is a general or limited partnership, an Affiliate shall be deemed
      to include affiliated partnerships managed by the same management company or
      managing general partner or by an entity which controls, is controlled by,
      or is
      under common control with, such management company or managing general
      partner.

    

    “Business
      Day”
means
      a
      day, other than a Saturday or Sunday, on which banks in New York City are open
      for the general transaction of business.

    

    “Control”
      (including the terms “controlling”, “controlled by” or “under common control
      with”) means the possession, direct or indirect, of the power to direct or cause
      the direction of the management and policies of a Person, whether through the
      ownership of voting securities, by contract or otherwise.

    

    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended, or any successor statute,
      and
      the rules and regulations promulgated thereunder.

    

    “Governing
      Documents”
means,
      as of any date, (i) in the case of a corporation, its certificate of
      incorporation and by-laws, (ii) in the case of a partnership, its certificate
      of
      partnership and partnership agreement, (iii) in the case of a limited liability
      company, its certificate of organization and limited liability company operating
      agreement, and (iv) any similar governing document of any such entity, in each
      such case as amended through such date.

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    

    “Intellectual
      Property”
means
      all of the following: (i) patents, patent applications, patent disclosures
      and
      inventions (whether or not patentable and whether or not reduced to practice);
      (ii) trademarks, service marks, trade dress, trade names, corporate names,
      logos, slogans and Internet domain names, together with all goodwill associated
      with each of the foregoing; (iii) copyrights and copyrightable works; (iv)
      registrations, applications and renewals for any of the foregoing; and (v)
      proprietary computer software (including but not limited to data, data bases
      and
      documentation).

    

    “Knowledge”
means
      the actual knowledge of the executive officers (as defined in Rule 405 under
      the
      Securities Act) of such Person, after due inquiry.

    

    “Material
      Adverse Effect”
means,
      with respect to the Company, Grand International or Renmin, a material adverse
      effect on (i) the assets, liabilities, results of operations, condition
      (financial or otherwise), business, or prospects of the Company, Grand
      International or Renmin, as the case may be, taken as a whole, or (ii) the
      ability of the Company or Grand International, as the case may be, to perform
      its obligations under the Transaction Documents.

    

    “Person”
means
      an individual, corporation, partnership, limited liability company, trust,
      business trust, association, joint stock company, joint venture, sole
      proprietorship, unincorporated organization, governmental authority or any
      other
      form of entity not specifically listed herein.

    

    “Securities
      Act”
means
      the Securities Act of 1933, as amended, or any successor statute, and the rules
      and regulations promulgated thereunder.

    

    “Subsidiaries”
means
      Grand International and Renmin.

    

    “Transaction
      Documents”
means
      this Agreement, the Notes and the Pledge Agreement and any other document
      entered into pursuant to this Agreement, the Notes and the Pledge
      Agreement.

    

    2. Purchase
      and Sale of the Notes.
      Subject
      to the terms and conditions of this Agreement, on the Closing Date, each of
      the
      Investors shall severally, and not jointly, purchase, and the Company shall
      sell
      and issue to the Investors, the Notes in the respective amounts and for the
      purchase price set forth opposite the Investors’ names on the signature pages
      attached hereto as specified in Section 3 below.

    

    3. Closing.
      Upon
      confirmation that the other conditions to closing specified herein have been
      satisfied or duly waived by the Investors, the Company shall deliver to
      Lowenstein Sandler PC, in trust, the Notes, each registered in such name or
      names as the Investors may designate, with instructions that such Notes are
      to
      be held for release to the Investors only upon payment in full of the purchase
      price to the Company by all the Investors. Upon such receipt by Lowenstein
      Sandler PC of the Notes, each Investor shall promptly, but no more than three
      (3) Business Days thereafter, cause a wire transfer in same day funds to be
      sent
      to the account of the Company as instructed in writing by the Company, in an
      amount representing such Investor’s pro rata portion of the purchase price as
      set forth on the signature pages to this Agreement. On the date (the “Closing
      Date”) the Company receives the purchase price, the Notes shall be released to
      the Investors (the “Closing”). The Closing shall take place at the offices of
      Lowenstein Sandler PC, 1251 Avenue of the Americas, 18th Floor, New York, New
      York 10020, or at such other location and on such other date as the Company
      and
      the Investors shall mutually agree.

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    

    

    4. Representations
      and Warranties of the Company.
      For
      purposes of this Section 4, the Company hereby represents and warrants to the
      Investors that, except as set forth in the schedules delivered herewith
      (collectively, the “Company Disclosure Schedules”):

    

    4.1 Organization,
      Good Standing and Qualification.
      The
      Company is duly organized, validly existing and in good standing under the
      laws
      of the jurisdiction of its incorporation and has all requisite power and
      authority to carry on its business as now conducted and as contemplated to
      be
      conducted and to own its properties. The Company is duly qualified to do
      business as a foreign corporation and is in good standing in each jurisdiction
      in which the conduct of its business or its ownership or leasing of property
      makes such qualification or leasing necessary unless the failure to so qualify
      has not had and could not reasonably be expected to have a Material Adverse
      Effect. Each of the Subsidiaries is duly organized, validly existing and in
      good
      standing under the laws of the jurisdiction of its incorporation and has all
      requisite power and authority to carry on its business as now conducted and
      as
      contemplated to be conducted and to own its properties. The Subsidiaries are
      the
      only subsidiaries, direct or indirect, of the Company. Each of the Subsidiaries
      is duly qualified to do business as a foreign corporation and is in good
      standing in each jurisdiction in which the conduct of its business or its
      ownership or leasing of property makes such qualification or leasing necessary
      unless the failure to so qualify has not had and could not reasonably be
      expected to have a Material Adverse Effect. The outstanding shares of capital
      stock of each of the Subsidiaries are owned as set forth on Schedule
      4.1
      hereto.
      The shares of capital stock of Grand International and Renmin held directly
      or
      indirectly by the Company are owned free and clear of all liens, encumbrances
      and equities and claims; and no options, warrants or other rights to purchase,
      agreements or other obligations to issue or other rights to convert any
      obligations into shares of capital stock or ownership interests in the
      Subsidiaries are outstanding.

    

    4.2 Authorization.
      The
      Company has full power and authority and has
      taken
      all requisite action on the part of it, its officers, directors and stockholders
      necessary for (i) the authorization, execution and delivery of the Transaction
      Documents, (ii) the authorization of the performance of all obligations of
      it
      hereunder or thereunder, and (iii) the authorization, issuance and delivery
      of
      the Notes.
      The
      Transaction Documents constitute the legal, valid and binding obligations of
      the
      Company, enforceable against it in accordance with their terms, subject to
      bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
      similar laws of general applicability, relating to or affecting creditors’
rights generally.

    

    4.3 Capitalization.
      Schedule
      4.3
      sets
      forth (a) the authorized capital stock of the Company on the date hereof; (b)
      the number of shares of capital stock issued and outstanding; (c) the number
      of
      shares of capital stock issuable pursuant to the Company’s stock plans; and (d)
      the number of shares of capital stock issuable and reserved for issuance
      pursuant to securities exercisable for, or convertible into or exchangeable
      for
      any shares of capital stock of the Company. All of the issued and outstanding
      shares of the Company’s capital stock have been duly authorized and validly
      issued and are fully paid, nonassessable and free of pre-emptive rights and
      were
      issued in compliance with applicable foreign, state and federal securities
      law
      and any rights of third parties. No Person is entitled to pre-emptive or similar
      statutory or contractual rights with respect to any securities of the Company.
      There are no outstanding warrants, options, convertible securities or other
      rights, agreements or arrangements of any character under which the Company
      is
      or may be obligated to issue any equity securities of any kind and except as
      contemplated by this Agreement, the Company is not currently in negotiations
      for
      the issuance of any equity securities of any kind. Except as set forth in the
      Transaction Documents, there are no voting agreements, buy-sell agreements,
      option or right of first purchase agreements or other agreements of any kind
      among the Company and any of the securityholders of the Company relating to
      the
      securities of the Company held by them. Except as set forth in the Transaction
      Documents, no Person has the right to require the Company to register any
      securities of the Company under the Securities Act, whether on a demand basis
      or
      in connection with the registration of securities of the Company for its own
      account or for the account of any other Person.

    
      
        
        

      

      
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    The
      issuance and sale of the Notes hereunder will not obligate the Company to issue
      any of its securities to any other Person (other than the Investors) and will
      not result in the adjustment of the exercise, conversion, exchange or reset
      price of any outstanding security.

    

    The
      Company does not have outstanding stockholder purchase rights or “poison pill”
or any similar arrangement in effect giving any Person the right to purchase
      any
      equity interest in the Company upon the occurrence of certain
      events.

    

    4.4 Valid
      Issuance.
      The
      Notes have been duly and validly authorized.

    

    4.5 Consents.
      The
      execution, delivery and performance by the Company of the Transaction Documents
      and the offer, issuance and sale of the Notes require no consent of, action
      by
      or in respect of, or filing with, any Person, governmental body, agency, or
      official other than filings that have been made pursuant to applicable state
      securities laws and post-sale filings pursuant to applicable foreign, state
      and
      federal securities laws which the Company undertakes to file within the
      applicable time periods. Subject to the accuracy of the representations and
      warranties of each Investor set forth in Section 6 hereof, the Company has
      taken
      all action necessary to exempt (i) the issuance and sale of the Notes, and
      (ii)
      the other transactions contemplated by the Transaction Documents from the
      provisions of any stockholder rights plan or other “poison pill” arrangement,
      any anti-takeover, business combination or control share law or statute binding
      on the Company or to which the Company or any of its assets and properties
      may
      be subject and any provision of the Governing Documents of the Company that
      is
      or could reasonably be expected to become applicable to the Investors as a
      result of the transactions contemplated hereby, including without limitation,
      the issuance of the Notes and the ownership, disposition or voting of the Notes
      by the Investors or the exercise of any right granted to the Investors pursuant
      to this Agreement or the other Transaction Documents.

    
      
        
        

      

      
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    4.6 Financial
      Information.
      The
      financial statements of Renmin as of and for the fiscal year ended June 30,
      2006
      and the nine months ended March 31, 2007, attached hereto as Schedule
      4.6,
      present
      fairly in all material respects the financial position of Renmin, and as of
      the
      dates thereof and the results of operations for the periods covered thereby,
      and
      have been prepared in accordance with U.S. generally accepted accounting
      principles consistently applied, except that the statements that are unaudited
      are subject to normal year-end adjustments and do not contain certain footnotes
      required by generally accepted accounting principles (collectively, the
“Financial Statements”).

    

    4.7 No
      Material Adverse Change.
      Since
      June 30, 2006, there has not been:

    

    (i) any
      change in the consolidated assets, liabilities, financial condition or operating
      results of Renmin from that reflected in Financial Statements, except for
      changes in the ordinary course of business which have not had and could not
      reasonably be expected to have a Material Adverse Effect, individually or in
      the
      aggregate;

    

    (ii) any
      declaration or payment of any dividend, or any authorization or payment of
      any
      distribution, on any of the capital stock of the Company or any of its
      Subsidiaries, or any redemption or repurchase of any securities of the Company
      or any of its Subsidiaries;

    

    (iii) any
      material damage, destruction or loss, whether or not covered by insurance to
      any
      assets or properties of the Company or any of its Subsidiaries;

    

    (iv) any
      waiver, not in the ordinary course of business, by the Company or any of its
      Subsidiaries of a material right or of a material debt owed to it;

    

    (v) any
      satisfaction or discharge of any lien, claim or encumbrance or payment of any
      obligation by the Company or any of its Subsidiaries, except in the ordinary
      course of business and which is not material to the assets, properties,
      financial condition, operating results or business of the Company or any of
      its
      Subsidiaries taken as a whole (as such business is presently conducted and
      as it
      is proposed to be conducted);

    

    (vi) any
      change or amendment to the Governing Documents of the Company or any of its
      Subsidiaries or other organizational documents, or material change to any
      material contract or arrangement by which the Company or any of its Subsidiaries
      is bound or to which any of its assets or properties is subject;

    

    (vii) any
      material labor difficulties or labor union organizing activities with respect
      to
      employees of the Company or any of its Subsidiaries;

    

    (viii) any
      material transaction entered into by the Company or any of its Subsidiaries;
      

    

    (ix) the
      loss
      of the services of any key employee, or material change in the composition
      or
      duties of the senior management of the Company or any of its
      Subsidiaries;

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    

    

    (x) the
      loss
      or threatened loss of any customer(s) which has had or could reasonably be
      expected to have a Material Adverse Effect, individually or in the aggregate;
      or

    

    (xi) any
      other
      event or condition of any character that has had or could reasonably be expected
      to have a Material Adverse Effect, individually or in the
      aggregate.

    

    4.8 No
      Conflict, Breach, Violation or Default.
      The
      execution, delivery and performance of the Transaction Documents by the Company
      and the issuance and sale of the Notes will not conflict with or result in
      a
      breach or violation of any of the terms and provisions of, or constitute a
      default under (i) the Governing Documents of the Company, as in effect on the
      date hereof (true and complete copies of which have been made available to
      the
      Investors), or (ii)(a) any statute, rule, regulation or order of any
      governmental agency or body or any court, domestic or foreign, having
      jurisdiction over the Company or any of its assets or properties, or (b) any
      agreement or instrument to which the Company is a party or by which the Company
      is bound or to which any of its assets or properties is subject.

    

    4.9 Tax
      Matters.
      The
      Company and its Subsidiaries have timely prepared and filed all tax returns
      required to have been filed by them with all appropriate governmental agencies
      and timely paid all taxes shown thereon or otherwise owed by them. The charges,
      accruals and reserves on the books of the Company or any of its Subsidiaries in
      respect of taxes for all fiscal periods are adequate in all material respects,
      and there are no material unpaid assessments against the Company or any of
      its
      Subsidiaries nor, to the Company’s Knowledge, any basis for the assessment of
      any additional taxes, penalties or interest for any fiscal period or audits
      by
      any federal, state or local taxing authority except for any assessment which
      is
      not material to the Company or any of its Subsidiaries, taken as a whole. All
      taxes and other assessments and levies that the Company or any of its
      Subsidiaries is required to withhold or to collect for payment have been duly
      withheld and collected and paid to the proper governmental entity or third
      party
      when due. There are no tax liens or claims pending or, to the Company’s
      Knowledge, threatened against the Company or any of its Subsidiaries or any
      of
      their respective assets or property. There are no outstanding tax sharing
      agreements or other such arrangements between the Company or any of its
      Subsidiaries and any other corporation or entity.

    

    4.10 Title
      to Properties.
      The
      Company and its Subsidiaries have good and marketable title to all real
      properties and all other properties and assets owned by them, in each case
      free
      from liens, any mortgages, liens, pledges, charges, security interests,
      encumbrances and defects that would materially affect the value thereof or
      materially interfere with the use made or currently planned to be made thereof
      by them; and the Company and its Subsidiaries hold any leased real or personal
      property under valid and enforceable leases with no exceptions that would
      materially interfere with the use made or currently planned to be made thereof
      by them.

    

    4.11 Certificates,
      Authorities and Permits.
      The
      Company and its Subsidiaries possess adequate certificates, authorities or
      permits issued by appropriate governmental agencies or bodies necessary to
      conduct the business now operated by them and contemplated to be operated by
      them, and neither the Company nor any of its Subsidiaries has received any
      notice of proceedings relating to the revocation or modification of any such
      certificate, authority or permit that, if determined adversely to it, could
      reasonably be expected to have a Material Adverse Effect, individually or in
      the
      aggregate.

    
      
        
        

      

      
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    4.12 Labor
      Matters. No
      labor
      dispute exists or, to the Company’s Knowledge, is imminent, with respect to any
      of the employees of the Company or any of its Subsidiaries which would have
      a
      Material Adverse Effect. None of the Company’s or any of its Subsidiaries’
employees is a member of a union that relates to such employee’s relationship
      with the Company or any of its Subsidiaries, and neither the Company nor any
      of
      its Subsidiaries is a party to a collective bargaining agreement, and the
      Company believes that its and its Subsidiaries’ relationship with its employees
      is good. No executive officer of the Company or any of its Subsidiaries (as
      defined in Rule 501(f) of the Securities Act) has notified the Company or any
      of
      its Subsidiaries that such officer intends to leave the Company or any of its
      Subsidiaries or otherwise terminate such officer's employment with the Company
      or any of its Subsidiaries. No executive officer, to the Company’s Knowledge, is
      in violation of any term of any employment contract, confidentiality, disclosure
      or proprietary information agreement or non-competition agreement, or any other
      contract or agreement or any restrictive covenant, and the continued employment
      of each such executive officer does not subject the Company or any of its
      Subsidiaries to any liability with respect to any of the foregoing matters.
      The
      Company and its Subsidiaries are in compliance with all federal, state, local
      and foreign laws and regulations relating to employment and employment
      practices, terms and conditions of employment and wages and hours, except where
      the failure to be in compliance would not, individually or in the aggregate,
      have a Material Adverse Effect.

    

    4.13 Intellectual
      Property.
      The
      Company and its Subsidiaries own, license or possess all patents, trademarks,
      trademark registrations, service marks, service mark registrations, trade names,
      copyrights, licenses, inventions, trade secrets, and rights reasonably necessary
      for the conduct of its business as it is now conducted and contemplated to
      be
      conducted, except for such failures as would not have a Material Adverse Effect,
      and the Company has no Knowledge of any claim to the contrary or any challenge
      by any other person to the rights of the Company or any of its Subsidiaries
      with
      respect to the foregoing. The Company and its Subsidiaries have not infringed
      and are not infringing the Intellectual Property of a third party, and neither
      the Company nor any of its Subsidiaries has received notice of a claim by a
      third party to the contrary.

    

    4.14 Environmental
      Matters.
      Neither
      the Company nor any of its Subsidiaries is in violation of any statute, rule,
      regulation, decision or order of any governmental agency or body or any court,
      domestic or foreign, relating to the use, disposal or release of hazardous
      or
      toxic substances or relating to the protection or restoration of the environment
      or human exposure to hazardous or toxic substances (collectively, “Environmental
      Laws”), owns or operates any real property contaminated with any substance that
      is subject to any Environmental Laws, is liable for any off-site disposal or
      contamination pursuant to any Environmental Laws, and is not subject to any
      claim relating to any Environmental Laws, which violation, contamination,
      liability or claim has had or could reasonably be expected to have a Material
      Adverse Effect, individually or in the aggregate; and there is no pending or,
      to
      the Company’s Knowledge, threatened investigation that might lead to such a
      claim.

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    

    4.15 Litigation.
      There
      are no pending actions, suits or proceedings against the Company or any of
      its
      Subsidiaries or any of their respective properties; and to the Company’s
      Knowledge, no such actions, suits or proceedings are threatened or
      contemplated.

    

    4.16 Insurance
      Coverage.
      The
      Company and its Subsidiaries maintain in full force and effect insurance
      coverage that is customary for comparably situated companies for the business
      being conducted and contemplated to be conducted and properties owned or leased
      by them, and the Company reasonably believes such insurance coverage to be
      adequate against all liabilities, claims and risks against which it is customary
      for comparably situated companies to insure.

    

    4.17 Brokers
      and Finders.
      Except
      as set forth on Schedule
      4.17
      attached
      hereto, no Person will have, as a result of the transactions contemplated by
      the
      Transaction Documents, any valid right, interest or claim against or upon the
      Company or any of its Subsidiaries or an Investor for any commission, fee or
      other compensation pursuant to any agreement, arrangement or understanding
      entered into by or on behalf of the Company or any of its
      Subsidiaries.

    

    4.18 No
      Directed Selling Efforts or General Solicitation.
      Neither
      the Company or any of its Subsidiaries, nor any other Person acting on its
      or
      their behalf, has conducted any general solicitation or general advertising
      (as
      those terms are used in Regulation D) in connection with the offer or sale
      of
      any of the Notes.

    

    4.19 No
      Integrated Offering.
      Neither
      the Company or any of its Subsidiaries, nor any of its Affiliates or any other
      Person acting on its or their behalf has, directly or indirectly, made any
      offers or sales of any Company security or solicited any offers to buy any
      security, under circumstances that would adversely affect reliance by the
      Company on Section 4(2) for the exemption from registration for the transactions
      contemplated hereby or would require registration of the Notes under the
      Securities Act.

    

    4.20 Private
      Placement.
      Subject
      to the accuracy of the representations and warranties of the Investors set
      forth
      in Section 6, the offer and sale of the Notes to the Investors as contemplated
      hereby is exempt from the registration requirements of the Securities
      Act.

    

    4.21 Questionable
      Payments.
      Neither
      the Company nor any of its Subsidiaries, nor to the Company’s Knowledge any
      current or former stockholders, directors, officers, employees, agents or other
      Persons acting on behalf of the Company or any of its Subsidiaries, has on
      behalf of the Company or any of its Subsidiaries or in connection with its
      business: (a) used any corporate funds for unlawful contributions, gifts,
      entertainment or other unlawful expenses relating to political activity; (b)
      made any direct or indirect unlawful payments to any governmental officials
      or
      employees from corporate funds; (c) established or maintained any unlawful
      or
      unrecorded fund of corporate monies or other assets; (d) made any false or
      fictitious entries on the books and records of the Company or any of its
      Subsidiaries; or (e) made any unlawful bribe, rebate, payoff, influence payment,
      kickback or other unlawful payment of any nature.

    
      
        
        

      

      
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    4.22 Material
      Agreements.
      Each
      material contract, document or other agreement of the Company or any its
      Subsidiaries is in full force and effect and is valid and enforceable by and
      against the Company and its Subsidiaries in accordance with its terms (except
      as
      rights to indemnity and contribution thereunder may be limited by federal or
      state securities laws and matter of public policy and except as the
      enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
      moratorium or other similar laws affecting the enforcement of creditors’ rights
      generally and by general equitable principle). Neither the Company nor any
      of
      its Subsidiaries nor, to the Company’s knowledge, any other party is in default
      in the observance or performance of any term or obligation to be performed
      by it
      under any such agreement or any other agreement or instrument to which the
      Company or its Subsidiaries is a party or by which the Company or its
      Subsidiaries or their respective properties or businesses may be bound, and
      no
      event has occurred which with notice or lapse of time or both would constitute
      such a default, in any such case in which the default or event, individually
      or
      in the aggregate, would have a Material Adverse Effect.

    

    5. Representations
      and Warranties of Grand International.
      For
      purposes of this Section 5, Grand International hereby represents and warrants
      to the Investors that, except as set forth in the schedules delivered herewith
      (collectively, the “Grand International Disclosure Schedules”):

    

    5.1 Organization,
      Good Standing and Qualification.
      Grand
      International is duly organized, validly existing and in good standing under
      the
      laws of the jurisdiction of its incorporation and has all requisite power and
      authority to carry on its business as now conducted and as contemplated to
      be
      conducted and to own its properties. Grand International is duly qualified
      to do
      business as a foreign corporation and is in good standing in each jurisdiction
      in which the conduct of its business or its ownership or leasing of property
      makes such qualification or leasing necessary unless the failure to so qualify
      has not had and could not reasonably be expected to have a Material Adverse
      Effect. 

    

    5.2 Authorization.
      Grand
      International has full power and authority and has
      taken
      all requisite action on the part of it, its officers, directors and stockholders
      necessary for (i) the authorization, execution and delivery of this Agreement
      and the other Transaction Documents to which it is a party, and (ii) the
      authorization of the performance of all obligations of it hereunder and
      thereunder. This Agreement and the other Transaction Documents to which it
      is a
      party constitute the legal, valid and binding obligations of Grand
      International, enforceable against it in accordance with its terms, subject
      to
      bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
      similar laws of general applicability, relating to or affecting creditors’
rights generally.

    

    5.3 Capitalization.
      Schedule
      5.3
      sets
      forth (a) the authorized capital stock of Grand International on the date
      hereof; (b) the number of shares of capital stock issued and outstanding; (c)
      the number of shares of capital stock issuable pursuant to Grand International’s
      stock plans; and (d) the number of shares of capital stock issuable and reserved
      for issuance pursuant to securities exercisable for, or convertible into or
      exchangeable for any shares of capital stock of Grand International. All of
      the
      issued and outstanding shares of Grand International’s capital stock have been
      duly authorized and validly issued and are fully paid, nonassessable and free
      of
      pre-emptive rights and were issued in compliance with applicable foreign, state
      and federal securities law and any rights of third parties. No Person is
      entitled to pre-emptive or similar statutory or contractual rights with respect
      to any securities of Grand International. There are no outstanding warrants,
      options, convertible securities or other rights, agreements or arrangements
      of
      any character under which Grand International is or may be obligated to issue
      any equity securities of any kind and except as contemplated by this Agreement
      and the other Transaction Documents, Grand International is not currently in
      negotiations for the issuance of any equity securities of any kind. There are
      no
      voting agreements, buy-sell agreements, option or right of first purchase
      agreements or other agreements of any kind among Grand International and any
      of
      the securityholders of Grand International relating to the securities of Grand
      International held by them. No Person has the right to require Grand
      International to register any securities of Grand International under the
      Securities Act, whether on a demand basis or in connection with the registration
      of securities of Grand International for its own account or for the account
      of
      any other Person.

    
      
        
        

      

      
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    5.4 Consents.
      The
      execution, delivery and performance by Grand International of this Agreement
      and
      the other Transaction Documents to which it is a party requires no consent
      of,
      action by or in respect of, or filing with, any Person, governmental body,
      agency, or official.

    

    5.5 No
      Conflict, Breach, Violation or Default.
      The
      execution, delivery and performance of this Agreement and the other Transaction
      Documents to which it is a party by Grand International will not conflict with
      or result in a breach or violation of any of the terms and provisions of, or
      constitute a default under (i) the Governing Documents of Grand International
      as
      in effect on the date hereof (true and complete copies of which have been made
      available to the Investors), or (ii)(a) any statute, rule, regulation or order
      of any governmental agency or body or any court, domestic or foreign, having
      jurisdiction over Grand International or any of its assets or properties, or
      (b)
      any agreement or instrument to which Grand International is a party or by which
      Grand International is bound or to which any of its assets or properties is
      subject.

     

    6. Representations
      and Warranties of the Investors.
      Each of
      the Investors hereby severally, and not jointly, represents and warrants to
      the
      Company and Grand International that:

    

    6.1 Organization
      and Existence.
      Such
      Investor is a validly existing corporation, limited partnership or limited
      liability company and has all requisite corporate, partnership or limited
      liability company power and authority to invest in the Notes pursuant to this
      Agreement.

    

    6.2 Authorization.
      The
      execution, delivery and performance by such Investor of the Transaction
      Documents to which such Investor is a party have been duly authorized and will
      each constitute the valid and legally binding obligation of such Investor,
      enforceable against such Investor in accordance with their respective terms,
      subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
      moratorium and similar laws of general applicability, relating to or affecting
      creditors’ rights generally.

    
      
        
        

      

      
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    6.3 Purchase
      Entirely for Own Account.
      The
      Notes to be received by such Investor hereunder will be acquired for such
      Investor’s own account, not as nominee or agent, and not with a view to the
      resale or distribution of any part thereof in violation of the Securities Act,
      and such Investor has no present intention of selling, granting any
      participation in, or otherwise distributing the same in violation of the
      Securities Act
      without
      prejudice, however, to such Investor’s right at all times to sell or otherwise
      dispose of all or any part of such Notes in compliance with applicable federal
      and state securities laws.
      Nothing
      contained herein shall be deemed a representation or warranty by such Investor
      to hold the Notes for any period of time. Such
      Investor
      is not a broker-dealer registered with the Commission under the Exchange Act
      or
      an entity engaged in a business that would require it to be so
      registered.

    

    6.4 Investment
      Experience.
      Such
      Investor acknowledges that it can bear the economic risk and complete loss
      of
      its investment in the Notes and has such knowledge and experience in financial
      or business matters that it is capable of evaluating the merits and risks of
      the
      investment contemplated hereby.

    

    6.5 Disclosure
      of Information.
      Such
      Investor has had an opportunity to receive all information related to the
      Company and its Subsidiaries requested by it and to ask questions of and receive
      answers from the Company regarding their respective businesses and the terms
      and
      conditions of the offering of the Notes. Neither such inquiries nor any other
      due diligence investigation conducted by such Investor shall modify, limit
      or
      otherwise affect such Investor’s right to rely on the representations and
      warranties made by the Company and Grand International contained in this
      Agreement.

    

    6.6 Restricted
      Securities.
      Such
      Investor understands that the Notes are characterized as “restricted securities”
under the U.S. federal securities laws inasmuch as they are being acquired
      from
      the Company in a transaction not involving a public offering and that under
      such
      laws and applicable regulations such securities may be resold without
      registration under the Securities Act only in certain limited
      circumstances.

    

    6.7 Legends.
      It is
      understood that, except as provided below, certificates evidencing the Notes
      may
      bear the following or any similar legend:

    

    (a) “THE
      SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I) SUCH SECURITIES
      HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED
      (THE “SECURITIES ACT”), (II) SUCH SECURITIES MAY BE SOLD PURSUANT TO RULE
      144(K), OR (III) THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY
      SATISFACTORY TO IT THAT SUCH TRANSFER MAY LAWFULLY BE MADE WITHOUT REGISTRATION
      UNDER THE SECURITIES ACT OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES
      LAWS.”

    

    (b) If
      required by the authorities of any state in connection with the issuance of
      sale
      of the Notes, the legend required by such state authority.

    
      
        
        

      

      
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    6.8 Accredited
      Investor.
      Such
      Investor is an accredited investor as defined in Rule 501(a) of Regulation
      D, as
      amended, under the Securities Act. The definition of “accredited investor” is
      attached hereto as Annex
      I.

    

    6.9 No
      General Solicitation.
      Such
      Investor did not learn of the investment in the Notes as a result of any general
      solicitation or general advertising.

    

    6.10 Brokers
      and Finders.
      No
      Person will have, as a result of the transactions contemplated by the
      Transaction Documents, any valid right, interest or claim against or upon the
      Company or any of its Subsidiaries or an Investor for any commission, fee or
      other compensation pursuant to any agreement, arrangement or understanding
      entered into by or on behalf of such Investor.

    

    7.
       Conditions
      to Closing.

    

    7.1 Conditions
      to the Investors’ Obligations.
      The
      obligation of each Investor to purchase the Notes at Closing is subject to
      the
      fulfillment to such Investor’s satisfaction, on or prior to the Closing Date, of
      the following conditions, any of which may be waived by such Investor (as to
      itself only):

    

    (a) The
      representations and warranties made by the Company and Grand International
      in
      Sections 4 and 5 hereof qualified as to materiality or Material Adverse Effect
      shall be true and correct on the Closing Date, except to the extent any such
      representation or warranty expressly speaks as of an earlier date, in which
      case
      such representation or warranty shall be true and correct as of such earlier
      date, and, the representations and warranties made by the Company and Grand
      International in Sections 4 and 5 hereof not qualified as to materiality or
      Material Adverse Effect shall be true and correct in all material respects
      on
      the Closing Date, except to the extent any such representation or warranty
      expressly speaks as of an earlier date, in which case such representation or
      warranty shall be true and correct in all material respects as of such earlier
      date. The Company and Grand International shall have performed in all material
      respects all obligations and covenants herein required to be performed by them
      on or prior to the Closing Date.

    

    (b) The
      Company and Grand International shall have obtained any and all consents,
      permits, approvals, registrations and waivers necessary or appropriate for
      consummation of the purchase and sale of the Notes and the consummation of
      the
      other transactions contemplated by the Transaction Documents to be consummated
      on or prior to the Closing Date, all of which shall be in full force and
      effect.

    

    (c) The
      Company shall have executed and delivered the Pledge Agreement.

    

    (d) No
      judgment, writ, order, injunction, award or decree of or by any court, or judge,
      justice or magistrate, including any bankruptcy court or judge, or any order
      of
      or by any governmental authority, shall have been issued, and no action or
      proceeding shall have been instituted by any governmental authority, enjoining
      or preventing the consummation of the transactions contemplated hereby or in
      the
      other Transaction Documents.

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    

    

    (e) The
      Investors shall have received an opinion from Lowenstein Sandler PC, US counsel
      to the Company and Grand International, dated as of the Closing Date, in form
      and substance reasonably acceptable to the Investors and addressing such legal
      matters as the Investors may reasonably request.

    

    (f) The
      Investors shall have received an opinion from Conyers Dill & Pearman, Cayman
      Islands counsel to the Company, dated as of the Closing Date, in form and
      substance reasonably acceptable to the Investors and addressing such legal
      matters as the Investors may reasonably request.

    

    (g) The
      Investors shall have received an opinion from Sit, Fung, Kwong, & Shum, Hong
      Kong counsel to Grand International, dated as of the Closing Date, in form
      and
      substance reasonably acceptable to the Investors and addressing such legal
      matters as the Investors may reasonably request.

    

    (h) Since
      the
      date of execution of this Agreement, no event or series of events shall have
      occurred that has had or would reasonably be expected to have a Material Adverse
      Effect.

     

    7.2 Conditions
      to Obligations of the Company.
      The
      Company's obligation to sell and issue the Notes at the Closing is subject
      to
      the fulfillment to the satisfaction of the Company on or prior to the Closing
      Date of the following conditions, any of which may be waived by the
      Company:

    

    (a) The
      representations and warranties made by the Investors in Section 6 hereof
      qualified as to materiality or Material Adverse Effect shall be true and correct
      on the Closing Date, except to the extent any such representation or warranty
      expressly speaks as of an earlier date, in which case such representation or
      warranty shall be true and correct as of such earlier date, and, the
      representations and warranties made by the Investors in Section 6 hereof not
      qualified as to materiality or Material Adverse Effect shall be true and correct
      in all material respects on the Closing Date, except to the extent any such
      representation or warranty expressly speaks as of an earlier date, in which
      case
      such representation or warranty shall be true and correct in all material
      respects as of such earlier date. The Investors shall have performed in all
      material respects all obligations and covenants herein required to be performed
      by them on or prior to the Closing Date.

    

    (b) The
      Investors shall have executed and delivered the Pledge Agreement.

    (c) The
      Investors shall have paid the purchase price for the Notes in accordance with
      Section 3.

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    

    7.3 Termination
      of Obligations to Effect Closing; Effects.

    

    (a) The
      outstanding obligations of the Company, on the one hand, and the Investors,
      on
      the other hand, to effect any Closing shall terminate as follows:

    

    (i) Upon
      the
      mutual written consent of the Company and the Investors;

    

    (ii) By
      the
      Company if any of the conditions set forth in Section 7.2 shall have become
      incapable of fulfillment, and shall not have been waived by the
      Company;

    

    (iii) By
      an
      Investor (with respect to itself only) if any of the conditions set forth in
      Section 7.1 shall have become incapable of fulfillment, and shall not have
      been
      waived by the Investor; or

    

    (iv) By
      either
      the Company or any Investor (with respect to itself only) if the Closing has
      not
      occurred on or prior to June 30, 2007; 

    

    provided,
      however, that, except in the case of clause (i) above, the party seeking to
      terminate its obligation to effect a Closing shall not then be in breach of
      any
      of its representations, warranties, covenants or agreements contained in this
      Agreement or the other Transaction Documents if such breach has resulted in
      the
      circumstances giving rise to such party’s seeking to terminate its obligation to
      effect the Closing.

    

    (b) In
      the
      event of termination by any Investor of its obligations to effect a Closing
      pursuant to this Section 7.3, written notice thereof shall forthwith be given
      to
      the other Investors and the other Investors shall have the right to terminate
      their obligations to effect such Closing upon written notice to the Company
      and
      the other Investors. Nothing in this Section 7.3 shall be deemed to release
      any
      party from any liability for any breach by such party of the terms and
      provisions of this Agreement or the other Transaction Documents or to impair
      the
      right of any party to seek to compel specific performance by any other party
      of
      its obligations under this Agreement or the other Transaction
      Documents.

    

    8. Covenants
      and Agreements.

    

    8.1 Registration
      Rights.
      The
      Company shall cause the Surviving Company in the Acquisition to be obligated
      to
      register for resale the shares of common stock issuable to the Investors (i)
      upon conversion of the Surviving Company Shares and (ii) upon exercise of the
      Surviving Company Warrants. The terms of such registration rights are
      substantially as set forth on Exhibit
      B
      attached
      hereto.

    

    8.2 Reports.
      The
      Company will furnish to the Investors and/or their assignees such information
      relating to the Company and its Subsidiaries as from time to time may reasonably
      be requested by the Investors and/or their assignees. For a period of two years
      from the Closing, the Company shall cause the Surviving Company to use its
      commercially reasonable efforts to timely file (or obtain extensions in respect
      thereof and file within the applicable grace period) all reports required to
      be
      filed by the Surviving Company pursuant to the Exchange Act. During such two
      year period, if the Surviving Company is not required to file reports pursuant
      to such laws, it will prepare and furnish to the Investors and make publicly
      available in accordance with Rule 144(c) of the Securities Act such information
      as is required for the Investors to sell the Surviving Company Shares, the
      Surviving Company Warrants and the shares of common stock of the Surviving
      Company issuable upon conversions or exercise thereof under Rule 144 of the
      Securities Act. 

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    

    

    8.3 No
      Conflicting Agreements.
      Neither
      the Company nor any of its Subsidiaries will take any action, enter into any
      agreement or make any commitment that would conflict or interfere in any
      material respect with the Company’s obligations to the Investors under the
      Transaction Documents.

    

    8.4 Compliance
      with Laws.
      Each of
      the Company and its Subsidiaries will comply in all material respects with
      all
      applicable laws, rules, regulations, orders and decrees of all governmental
      authorities.

    

    8.5 Additional
      Investment Right.
      For a
      period of three (3) months following the closing of the Acquisition, the
      Investors shall have the exclusive right, but not the obligation, to make an
      additional investment of up to an aggregate maximum of US$5,000,000 in Surviving
      Company Shares and Surviving Company Warrants (the “Additional Investment
      Right”) on terms substantially as set forth on Exhibit
      B
      attached
      hereto.

    

    8.6 Insider
      Share Escrow. Immediately prior to the closing of the Acquisition, the
      Company shall cause certain of the management of the public company target
      (“Target Management”) to deliver into an escrow account an aggregate
number
      of
      shares equal to 20% of the outstanding
      shares
      of common stock of the Surviving
      Company immediately following the closing
      of the Acquisition
      and the
      conversion of the Notes into the Surviving Company Shares,
      based
      upon the number of shares
      of
      common stock of the Surviving Company issuable
      upon conversion of the Surviving Company Shares and all other securities
      convertible into or exercisable for common stock of the Surviving Company,
      but
      not including the Surviving Company Warrants (the
      “Escrowed Shares”).
      If
      the
      Surviving Company achieves at least 90.01% of estimated net income for fiscal
      year 2008
      set
      forth on Schedule 8.6, all
      Escrowed Shares will be returned to the Target Management. If the Surviving
      Company achieves between 50% and 90% of the estimated net income for fiscal
      year 2008
      set
      forth on Schedule 8.6, for
      every
      10% the Surviving Company misses, the Investors would receive, on a pro rata
      basis based upon the ownership percentage of such Investors in the Surviving
      Company immediately following the Acquisition, 25% of
      the
      Escrowed Shares with any remaining amount of Escrowed Shares being returned
      to
      the Target Management. If the Surviving Company achieves less than 49.99% of
      the
      estimated net income for fiscal year 2008
      set
      forth on Schedule 8.6, all
      of
      the Escrowed Shares will be delivered to the Investors, on a pro
      rata basis
      based upon the ownership percentage of such Investors in the Surviving Company
      immediately following the Acquisition. 

    

    8.7 Public
      Disclosure; Marketing.
      The
      Surviving Company shall file a Form 8-K within one (1) Business Day from the
      closing of the Acquisition. Upon completion of Acquisition and effectiveness
      of
      the registration statement filed with the Commission pursuant to Section 8.1
      hereof, the Company shall (i) participate in at least two (2) non-deal road
      show
      in the United States, (ii) participate in at least two (2) conferences in the
      United States, and (iii) hire an investor relations firm acceptable to the
      Investors within sixty (60) days of the later to occur of (A) closing of the
      Acquisition and (B) effectiveness of the registration statement filed with
      the
      Commission pursuant to Section 8.1 hereof.

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    

    

    8.8 Use
      of
      Proceeds.
      The net
      proceeds from the sale of the Notes shall be used (i) to acquire the outstanding
      capital stock of Renmin held as of the date of this Agreement by the government
      of the Peoples Republic of China, which shares of capital stock represent
      approximately 11.77% of the issued and outstanding capital stock of Renmin
      and
      (ii) for working capital purposes. 

    

    8.9 Government
      Buy-Out.
      Within
      ten (10) Business Days after the Company or Grand International acquires the
      outstanding capital stock of Renmin held as of the date of this Agreement by
      the
      government of the Peoples Republic of China (which shares of capital stock
      represent approximately 11.77% of the issued and outstanding capital stock
      of
      Renmin) and converts Renmin into a WOFE (Wholly-Owned Foreign Enterprise),
      Renmin shall execute a counterpart signature to this Agreement to confirm the
      representations and warranties set forth in Section 4 hereof made by the Company
      and Grand International shall use its commercially reasonable efforts to obtain
      approval of the government of the Peoples Republic of China of a pledge of
      the
      shares of Renmin beneficially held by Grand International to the Investors.
      The
      Company and Grand International shall use commercially reasonable efforts and
      shall act in good faith to consummate such acquisition as soon as practicable
      after the date of this Agreement.

    

    8.10 Surviving
      Company Assumption.
      The
      Company shall cause the Surviving Company in the Acquisition to assume the
      Company’s obligations under this Agreement and the other Transaction Documents
      by executing a counterpart signature to this Agreement to confirm such
      assumption of obligations.

    

    8.11 Investor
      Obligations.
      The
      Investors shall act in good faith with respect to the Acquisition. 

    

    8.12 Conduct
      Pending the Closing.
      During
      the period from the date of this Agreement and continuing until the Acquisition,
      the Company agrees as to itself and, with respect to Grand International and
      Renmin, that except as expressly contemplated or permitted by this Agreement,
      or
      to the extent that the other party shall otherwise consent in writing or
      otherwise provided for in Section 8.9, it shall not, nor in the case of the
      Company shall it permit Grand International or Renmin to, issue, sell, redeem,
      acquire or authorize any shares of its capital stock of any class or any
      securities convertible into, or any rights, warrants or options to acquire,
      any
      such shares or convertible securities or other ownership interest.

     

    8.13 Appointment
      of Accounting Firm.
      The
      Company shall cause the Surviving Company to appoint a registered independent
      public accounting firm of international standing as the Surviving Company’s
      auditors following the completion of the Acquisition.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    

     

    8.14 Transfer
      Restrictions.
      No
      Investor shall sell, transfer, assign or dispose of any Notes, Surviving Company
      Shares, Surviving Company Warrants or shares of common stock issuable to the
      Investors upon conversion of the Surviving Company Shares or upon exercise
      of
      the Surviving Company Warrants unless (a) there is then in effect an effective
      registration statement under the Securities Act covering such proposed
      disposition and such disposition is made in accordance with such registration
      statement or (b) such Investor has notified the Company in writing of any such
      disposition and furnished the Company with an opinion of counsel, reasonably
      satisfactory to the Company, that such disposition will not require registration
      of such securities under the Securities Act; provided, however, that no such
      opinion of counsel will be required (i) if the sale, transfer or assignment
      is
      made to an Affiliate of such Investor in compliance with applicable securities
      laws, provided that such Affiliate provides the Company with customary
      accredited investor and investment representations and agrees to be bound by
      the
      terms and conditions of this Agreement, or (ii) if the sale, transfer or
      assignment is made pursuant to Rule 144 and such Investor provides the Company
      with customary representations and/or other evidence reasonably satisfactory
      to
      the Company that the proposed transaction satisfies the requirements of Rule
      144.

     

    8.15
       Delivery
      of Legal Opinion upon Conversion of Notes.
      The
      Company shall cause the Surviving Company in the Acquisition to deliver an
      opinion of counsel regarding the valid issuance of the Surviving Company Shares
      (and the common stock issuable upon due conversion thereof) and Surviving
      Company Warrants (and the common stock issuable upon due exercise thereof)
      upon
      conversion of the Notes. 

     

    8.16 Appointment
      of Chief Financial Officer.
      The
      Company shall use its commercially reasonable efforts to cause the Surviving
      Company to appoint a chief financial officer of the Surviving Company with
      an
      understanding of United States GAAP and Regulation S-X promulgated under the
      Securities Act within six months of the date of this Agreement. 

     

    8.17 Marketing.
      Following the closing of the Acquisition and to the extent requested by the
      Investors, the Company shall use its commercially reasonable efforts to cause
      the Surviving Company to retain an investor relations and PR firm.

     

    8.18
       Tax
      Undertaking.
      Following the Closing hereunder, the Company shall request a Tax Undertaking
      in
      the Cayman Islands and promptly deliver the Tax Undertaking to the Investors
      upon receipt by the Company. 

     

    8.19
      Background
      Checks.
      Following the Closing hereunder, the Company shall deliver criminal background
      checks on each of the executive officers of the Company. In the event that,
      as a
      result of the findings contained in the background checks, the Company would
      be
      required to disclose information regarding such findings about any executive
      officer pursuant to Item 401 of Regulation S-B or S-K promulgated under the
      Securities Act or any rule of the Nasdaq Stock Market, the American Stock
      Exchange or the New York Stock Exchange in any of the Company's required filings
      under the Exchange Act, then the Company shall remove such executive officer
      promptly and shall replace such executive officer as soon as commercially
      reasonable. 

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    

     

    9. Survival
      and Indemnification.

    

    9.1 Survival.
      The
      representations, warranties, covenants and agreements contained in this
      Agreement shall survive the Closing of the transactions contemplated by this
      Agreement.

    

    9.2 Indemnification.
      Each of
      the Company and Grand International, jointly and severally, agrees to indemnify
      and hold harmless each Investor and its Affiliates and their respective
      directors, officers, employees and agents from and against any and all losses,
      claims, damages, liabilities and expenses (including without limitation
      reasonable attorney fees and disbursements and other expenses incurred in
      connection with investigating, preparing or defending any action, claim or
      proceeding, pending or threatened and the costs of enforcement thereof)
      (collectively, “Losses”) to which such Person may become subject as a result of
      any breach of representation, warranty, covenant or agreement made by or to
      be
      performed by it under the Transaction Documents, and will reimburse any such
      Person for all such amounts as they are incurred by such Person.

    

    9.3 Conduct
      of Indemnification Proceedings.
      Promptly
      after receipt by any Person (the “Indemnified Person”) of notice of any demand,
      claim or circumstances which would or might give rise to a claim or the
      commencement of any action, proceeding or investigation in respect of which
      indemnity may be sought pursuant to Section 9.2, such Indemnified Person shall
      promptly notify the Company in writing and the Company shall assume the defense
      thereof, including the employment of counsel reasonably satisfactory to such
      Indemnified Person, and shall assume the payment of all fees and expenses;
      provided, however, that
      the
      failure of any Indemnified Person so to notify the Company shall not relieve
      the
      Company of its obligations hereunder except to the extent that the Company
      or
      any of its Subsidiaries is materially prejudiced by such failure to notify.
      In
      any such proceeding, any Indemnified Person shall have the right to retain
      its
      own counsel, but the fees and expenses of such counsel shall be at the expense
      of such Indemnified Person unless: (i) the Company and the Indemnified Person
      shall have mutually agreed to the retention of such counsel; or (ii) in the
      reasonable judgment of counsel to such Indemnified Person representation of
      both
      parties by the same counsel would be inappropriate due to actual or potential
      differing interests between them. The Company shall not be liable for any
      settlement of any proceeding effected without its written consent, which consent
      shall not be unreasonably withheld, but if settled with such consent, or if
      there be a final judgment for the plaintiff, the Company and Grand International
      shall indemnify and hold harmless such Indemnified Person from and against
      any
      loss or liability (to the extent stated above) by reason of such settlement
      or
      judgment. Without the prior written consent of the Indemnified Person, which
      consent shall not be unreasonably withheld, the Company shall not effect any
      settlement of any pending or threatened proceeding in respect of which any
      Indemnified Person is or could have been a party and indemnity could have been
      sought hereunder by such Indemnified Party, unless such settlement includes
      an
      unconditional release of such Indemnified Person from all liability arising
      out
      of such proceeding.

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    

    10. Miscellaneous.

    

    10.1 Successors
      and Assigns.
      This
      Agreement may not be assigned by a party hereto without the prior written
      consent of the Company or the Investors, as applicable, provided, however,
      that
      an Investor may assign its rights and delegate its duties hereunder in whole
      or
      in part to an Affiliate or to a third party acquiring some or all of the
      securities of the Surviving Company from an Investor in a private transaction
      without the prior written consent of the Company or the other Investors, after
      notice duly given by such Investor to the Company provided, that no such
      assignment or obligation shall affect the obligations of such Investor
      hereunder. For the avoidance of doubt, notwithstanding any of the foregoing,
      an
      Investor can transfer the Notes without restriction so long as such Investor
      complies with Section 8.14.
      The
      provisions of this Agreement shall inure to the benefit of and be binding upon
      the respective permitted successors and assigns of the parties, including the
      Surviving Company in the Acquisition. Nothing in this Agreement, express or
      implied, is intended to confer upon any party other than the parties hereto
      or
      their respective successors and assigns any rights, remedies, obligations,
      or
      liabilities under or by reason of this Agreement, except as expressly provided
      in this Agreement.

    

    10.2 Counterparts;
      Faxes.
      This
      Agreement may be executed in two or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument. This Agreement may also be executed via facsimile, which shall
      be
      deemed an original.

    

    10.3 Titles
      and Subtitles.
      The
      titles and subtitles used in this Agreement are used for convenience only and
      are not to be considered in construing or interpreting this
      Agreement.

    

    10.4 Notices.
      Unless
      otherwise provided, any notice required or permitted under this Agreement shall
      be given in writing and shall be deemed effectively given as hereinafter
      described (i) if given by personal delivery, then such notice shall be deemed
      given upon such delivery, (ii) if given by telex or telecopier, then such notice
      shall be deemed given upon receipt of confirmation of complete transmittal,
      (iii) if given by mail, then such notice shall be deemed given upon the earlier
      of (A) receipt of such notice by the recipient or (B) five days after such
      notice is deposited in first class mail, postage prepaid, and (iv) if given
      by
      an internationally recognized overnight air courier, then such notice shall
      be
      deemed given two Business Days after delivery to such carrier. All notices
      shall
      be addressed to the party to be notified at the address as follows, or at such
      other address as such party may designate by five days’ advance written notice
      to the other party:

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    

    If
      to the
      Company, to: 

    

    Qingdao
      Renmin Printing Co., Ltd.

    No.
      15,
      Xinghua Road

    Qingdao,
      Shandong Province

    Postal
      Code 266401

    P.R.
      China

    Telephone
      No.: (532) 8463 0577

    Facsimile
      No.: 
      (532)
      8463 0586

    Attention:
      Mr. Yijun Wang

    

    With
      a
      copy to:

    

    Lowenstein
      Sandler PC

    65
      Livingston Avenue

    Roseland,
      New Jersey 07068

    Telephone
      No.: 973-597-2500

    Facsimile
      No.: 973-597-2400

    Attention:
      Steven M. Skolnick, Esq.

    

    Han
      Kun
      Law Offices

    Suite
      906, Office Tower C1, Oriental Plaza

    No.
      1
      East Chang An Ave.

    Beijing,
      100738 P. R. China

    Telephone
      No.: +86 10 8525 5500

    Facsimile
      No.: 86
      10
      8525 5511 / 8525 5522

    Attention:
      Charles Li, Esq.

    

    If
      to an
      Investor, to the address set forth under such Investor’s name on the signature
      page hereof.

    

    10.5 Expenses.
      The
      Company shall promptly reimburse the Investors, on a pro rata basis, an amount
      not to exceed US$30,000 in the aggregate, for direct invoiced expenses to cover
      due diligence costs. In addition, the Company shall promptly
      reimburse
      the Investors, on a pro rata basis, an amount not to exceed US$25,000 in the
      aggregate, for the Investor’s reasonable legal fees. Unless otherwise provided
      for in this Section 10.5, the parties hereto shall pay their own costs and
      expenses in connection herewith. 

    

    10.6 Amendments
      and Waivers.
      Any
      term of this Agreement may be amended and the observance of any term of this
      Agreement may be waived (either generally or in a particular instance and either
      retroactively or prospectively), only with the written consent of the Company
      and the Investors and their respective permitted assigns. Any amendment or
      waiver effected in accordance with this paragraph shall be binding upon each
      holder of any Notes purchased under this Agreement at the time outstanding,
      each
      future holder of all such Notes, and the Company.

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

    

    

    10.7 Severability.
      Any
      provision of this Agreement that is prohibited or unenforceable in any
      jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
      such prohibition or unenforceability without invalidating the remaining
      provisions hereof but shall be interpreted as if it were written so as to be
      enforceable to the maximum extent permitted by applicable law, and any such
      prohibition or unenforceability in any jurisdiction shall not invalidate or
      render unenforceable such provision in any other jurisdiction. To the extent
      permitted by applicable law, the parties hereby waive any provision of law
      which
      renders any provision hereof prohibited or unenforceable in any
      respect.

    

    10.8 Entire
      Agreement.
      This
      Agreement, including the Annexes, Exhibits, the Company Disclosure Schedules,
      the Grand International Disclosure Schedules and the other Transaction Documents
      constitute the entire agreement among the parties hereof with respect to the
      subject matter hereof and thereof and supersede all prior agreements and
      understandings, both oral and written, between the parties with respect to
      the
      subject matter hereof and thereof.

    

    10.9 Further
      Assurances.
      The
      parties shall execute and deliver all such further instruments and documents
      and
      take all such other actions as may reasonably be required to carry out the
      transactions contemplated hereby or in the other Transaction Documents and
      to
      evidence the fulfillment of the agreements herein or therein
      contained.

    

    10.10 Governing
      Law; Consent to Jurisdiction; Waiver of Jury Trial.
      This
      Agreement shall be governed by, and construed in accordance with, the internal
      laws of the State of New York without regard to the choice of law principles
      thereof. Each of the parties hereto irrevocably submits to the exclusive
      jurisdiction of the courts of the State of New York located in New York County
      and the United States District Court for the Southern District of New York
      for
      the purpose of any suit, action, proceeding or judgment relating to or arising
      out of this Agreement and the transactions contemplated hereby. Service of
      process in connection with any such suit, action or proceeding may be served
      on
      each party hereto anywhere in the world by the same methods as are specified
      for
      the giving of notices under this Agreement. Each of the parties hereto
      irrevocably consents to the jurisdiction of any such court in any such suit,
      action or proceeding and to the laying of venue in such court. Each party hereto
      irrevocably waives any objection to the laying of venue of any such suit, action
      or proceeding brought in such courts and irrevocably waives any claim that
      any
      such suit, action or proceeding brought in any such court has been brought
      in an
      inconvenient forum. EACH
      OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY
      LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN
      CONSULTED SPECIFICALLY AS TO THIS WAIVER.

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

    

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

    
      
        
        

      

      
        -23-

        
          

        

      

      
        
        

      

    

    

    IN
      WITNESS WHEREOF, the parties have executed this Agreement or caused their duly
      authorized officers to execute this Agreement as of the date first above
      written.

    

    
      	 	
              Jpak
                Group Co., Ltd.

            
	 	 	 
	 	 	 
	 	
              By:

            	
                 
                

            
	 	
              Name:
                

            	 
	 	
              Title:
                

            	 
	 	 	 
	 	
              Grand
                International Industrial Limited

            
	 	 	 
	 	 	 
	 	
              By:

            	
                 
                

            
	 	
              Name:
                

            	 
	 	
              Title:
                

            	 
	 	
               

            	 

    

    

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

    [INVESTOR
      SIGNATURE PAGE]

    

    

    
      	
              Name
                of Investor:

            	
              QVT
                Fund LP,

            
	 	
              By
                its general partner, QVT Associates GP LLC

            
	
               

            	 	 
	 	
              By:

            	
               
                

            
	 	
              Name:
                

            	 
	 	
              Title:
                

            	 
	
               

            	 	 
	 	
              By:

            	
               
                

            
	 	
              Name:
                

            	 
	 	
              Title:
                

            	 

    

     

    Principal
      Amount of Notes (Purchase Price): US$2,750,000

     

    Address
      for Notice:

     

    c/o
      QVT
      Financial LP

    1177
      Avenue of the Americas, 9th
      Floor

    New
      York,
      NY 10036

    Telephone
      No.: (212) 705-8800

    Facsimile
      No.: (212) 705-8820

    Attention:
      Yi Cen

     

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

    [INVESTOR
      SIGNATURE PAGE]

    

    

    
      	
              Name
                of Investor:

            	
              Vision
                Opportunity Master Fund

            
	 	 	 
	 	 	 
	 	
              By:

            	
                
                

            
	 	
              Name:
                

            	 
	 	
              Title:
                

            	 

    

    

    Principal
      Amount of Notes (Purchase Price): US$2,750,000

    

    Address
      for Notice and Delivery of the Notes:

    

    Vision
      Capital Advisors, LLC

    20
      West
      55th
      Street

    5th
      Floor

    New
      York,
      New York 10019-5373

    Telephone
      No.: (212) 849-8238

    Facsimile
      No.: 
      (212)
      867-1416

    Attention:
      Antii Uusiheimala

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

    ANNEX
      I

    ACCREDITED
      INVESTOR QUESTIONNAIRE

    

    In
      order
      for the Company to offer and sell the Notes in conformance with state and
      federal securities laws, the following information must be obtained regarding
      your investor status. Please initial
      each category applicable
      to you as an Investor of Notes of the Company and execute
      this
      Accredited Investor Questionnaire where indicated below.

    

    Definition
      of “Accredited Investor”:

    

    
      	
              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.

            
	 	 
	
              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 Notes.

            
	 	 
	
              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. 

            
	 	
                

            
	
              Category
                E  

            	
              The
                undersigned is a private business development company as defined
                in
                section 202(a)(22) of the Investment Advisors Act of 1940.
                

            
	 	 
	
              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 Notes and with total assets in excess of
                $5,000,000.

            
	 	 
	
              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 Notes, 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.

            

    

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

    

    
      	
              Name
                of Investor:

            	
               
                

            	 
	 	 	 	 
	 	 	 	 
	 	
              By:

            	
               
                

            	 
	 	
              Name:
                

            	 	 
	 	
              Title:
                

            	 	 

    

    

    Date:
      _______________________

    

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

    

    FORM
      OF
      NOTE

    

    
      
        
        

      

      
        -29-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

    

    TERMS
      OF

    SURVIVING
      COMPANY SHARES;

    SURVIVING
      COMPANY WARRANTS; 

    ADDITIONAL
      INVESTMENT RIGHT; AND

    REGISTRATION
      RIGHTS

    

    I. Surviving
      Company Shares:

    

    The
      Investors shall receive Surviving Company Shares from conversion of the Notes
      upon closing of the Acquisition. Certain terms of the Surviving Company Shares
      are as follows (the Surviving Company Shares will be subject to such customary
      additional terms not inconsistent with the below as set forth in the Certificate
      of Designations or other applicable document to be filed by the Surviving
      Company in connection with the Acquisition):

    

    
      	
              Preferred
                Stock:

            	
              Convertible
                Preferred Stock will be issued by the Surviving Company, which will
                be
                convertible into shares of common stock of the Surviving Company
                on a 1
                for 1 basis.

            
	 	 
	
              Conversion
                Price

            	 
	
              Adjustment:

            	
              In
                the event the government buy-out described in Section 8.9 of the
                Agreement
                is not completed within four (4) months following the closing date
                of the
                Acquisition, the conversion price of the Surviving Company Shares
                shall be
                adjusted accordingly to reflect an approximately 88.23% ownership
                of
                Renmin (the conversion price is currently based on 100% ownership
                of
                Renmin).

            
	 	 
	
              Dividends:

            	
              The
                Convertible Preferred Stock will not accrue dividends. However, in
                the
                event that any dividends are paid on the Surviving Company’s common stock,
                the holders of Convertible Preferred Stock shall share with the holders
                of
                common stock on an as converted basis in such
                dividends.

            
	 	 
	
              Anti-dilution:

            	
              For
                a period of twelve (12) months after the closing of the Acquisition,
                the
                Convertible Preferred Stock will have full-ratchet anti-dilution
                protection.

            
	 	 
	 	
              After
                twelve (12) months from the closing of the Acquisition, the Convertible
                Preferred Stock will have weighted average anti-dilution
                protection.

            
	 	 
	
              Voting
                Rights:

            	
              The
                holders of Convertible Preferred Stock shall be entitled to vote
                together
                with the holders of the Surviving Company’s common stock on an as
                converted basis. The holders shall not be able to vote more than
                9.99% of
                the shares
                of common
                stock (on an as converted basis)
                issuable upon conversion of the Convertible Preferred Stock.
                

            

    

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

    

    
      	
              Restrictions
                on Exercise:

            	
              Investors
                shall not convert Convertible Preferred Stock to the extent such
                Investor’s beneficial ownership, as defined in Rule 13d-3 under the
                Exchange Act, of common stock of the Surviving Company would exceed
                9.99%
                of the Surviving Company’s outstanding common
                stock.

            

    

    

    

    II. Surviving
      Company Warrants:

    

    The
      Investors shall receive two classes of Surviving Company Warrants from
      conversion of the Notes upon closing of the Acquisition. Certain terms of the
      Surviving Company Warrants are as follows (the Surviving Company Warrants will
      be subject to such customary additional terms not inconsistent with the below
      as
      set forth in the form of Warrants to be issued in connection with the
      Acquisition):

    

    
      	
              Warrants:

            	
              Warrants
                will be issued by the Surviving Company in two classes - Class A
                and Class
                B.

            
	 	 
	 	
              Each
                class of Warrants will be exercisable for fifty percent (50%) of
                the
                number of shares of common stock of the Surviving Company issuable
                upon
                conversion of the Surviving Company Shares to be received by the
                Investors
                from conversion of the Notes upon closing of the
                Acquisition.

            
	 	 
	 	
              Each
                class of Warrants will be exercisable for a period of four (4) years
                beginning on the date of conversion of the Notes upon closing of
                the
                Acquisition.

            
	 	 
	 	
              The
                exercise price of the Class A Warrants shall be equal to 120% of
                the
                conversion price of the Surviving Company Shares.

            
	 	 
	 	
              The
                exercise price of the Class B Warrants shall be equal to 140% of
                the
                conversion price of the Surviving Company Shares.

            
	 	 
	 	
              If
                the shares of common stock of the Surviving Company underlying the
                Warrants are not registered for resale with the SEC within twelve
                (12)
                months after the closing of the Acquisition, then the holders of
                the
                Warrants may make a cashless exercise of the Warrants.

            
	 	 
	 	
              Each
                class of Warrants will be callable at 250% of the exercise price
                so long
                as the shares of common stock of the Surviving Company underlying
                the
                Warrants are registered and there is a minimum average daily trading
                volume of
                $1,000,000
                for 15 consecutive trading days.

            

    

    
      
        
        

      

      
        -31-

        
          

        

      

      
        
        

      

    

    

    

    
      	
              Anti-dilution:

            	
              For
                a period of twelve (12) months after the closing of the Acquisition,
                the
                Warrants will have full-ratchet anti-dilution
                protection.

            
	 	 
	 	
              After
                twelve (12) months from the closing of the Acquisition, the Warrants
                will
                have weighted average anti-dilution protection.

            
	 	 
	
              Restrictions
                on Exercise:

            	
              Investors
                shall not exercise Warrants to the extent such Investor’s beneficial
                ownership, as defined in Rule 13d-3 under the Exchange Act, of common
                stock of the Surviving Company would exceed 9.99% of the Surviving
                Company’s outstanding common stock.

            

    

     

    III. Additional
      Warrant:

    

    The
      Investors will receive a warrant to purchase additional shares of Convertible
      Preferred Stock at the same per share price of the Convertible Preferred Stock
      issuable upon conversion of the Notes, which shall be exercisable
      for
      a period
      of three (3) months following the closing of the effectiveness
      of the Registration Statement described below. The warrant shall
      provide
      for the purchase
      of up to
      an aggregate maximum of US$5,000,000 in Surviving Company Shares and Surviving
      Company Warrants (the warrant
      will be
      subject to such customary additional terms not inconsistent with the
      below):

    

    
      	
              Securities:

            	
              The
                terms of the Convertible Preferred Stock and Warrants to be purchased
                pursuant to this warrant shall
                have the same terms as the Surviving Company Shares and Surviving
                Company
                Warrants, except as set forth below.

            
	 	 
	
              Anti-dilution:

            	
              The
                Convertible Preferred Stock and Warrants purchased pursuant to such
                warrant
                will have weighted average anti-dilution protection.

            
	 	 
	
              Conversion/Exercise:

            	
              The
                conversion price of the Convertible Preferred Stock purchased pursuant
                to
                the warrant
                shall be 120% of the conversion price of the Surviving Company Shares
                and
                the exercise price of the Warrants purchased pursuant to the warrant shall
                be 120% of the exercise price of the Surviving Company Warrants.
                

            
	 	 

    

    
      
        
        

      

      
        -32-

        
          

        

      

      
        
        

      

    

    

    
      	
              IV.

            	
              Registration
                Rights:

            	 

    

    

    The
      Investors shall have certain registration rights with respect to the shares
      of
      common stock of the Surviving Company issuable upon conversion of the Surviving
      Company Shares and upon exercise of the Surviving Company Warrants. Certain
      terms of the registration rights are as follows (the registration rights will
      be
      subject to such customary additional terms not inconsistent with the
      below):

    

    
      	
              Registration
                Rights:

            	
              The
                Surviving Company shall file a registration statement on Form SB-2
                (or any
                other applicable form) to register for resale the shares of common
                stock
                of the Surviving Company issuable upon conversion of the Surviving
                Company
                Shares and upon exercise of the Surviving Company Warrants. The
                registration statement shall be filed within 30 days after the closing
                of
                the Acquisition. The registration statement must be declared effective
                within 120 days after the closing of the Acquisition (150 days in
                the
                event of review by the SEC).

            
	 	 
	 	
              The
                securities purchased under the Additional Warrant shall
                have the same registration rights as the Surviving Company Shares
                and the
                Surviving Company Warrants.

            
	 	 
	 	
              Liquidated
                damages of 2.0% (initially and for each 30-day period thereafter)
                of the
                purchase price paid by each Investor for the Notes will apply in
                the event
                the registration statement is not timely filed or declared effective,
                not
                to exceed a total of 10%. Such liquidated damages shall be paid by
                the
                Surviving Company in cash pro rata to the
                Investors.

            

    

    

    V. Lock-Up
      Agreements: 

    

    Management
      shareholders of the Company shall execute customary lock-up agreements that
      will
      provide for a lock-up of the shares held by them for a period of six months
      following the effective date of the registration statement described above.
      In
      addition, for a period of 12 months thereafter, the shareholders will be
      entitled to sell 1/12 of their holdings at the start of such 12 month period
      every month during such 12 month period. 

    

    
      
        
        

      

      
        -33-

        
          

        

      

      
        
        

      

    

    EXHIBIT
      C

    

    FORM
      OF
      PLEDGE AGREEMENT

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