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    REGISTRATION
      RIGHTS AGREEMENT

     

    This
      Registration Rights Agreement (this "Agreement")
      is made
      and entered into as of November 17, 2004, by and among The Bluebook
      International Holding Company, a Delaware corporation (the "Company"),
      and
      the investors signatory hereto (each a "Investor"
      and
      collectively, the "Investors").

     

    This
      Agreement is made pursuant to the Securities Purchase Agreement, dated as of
      the
      date hereof among the Company and the Investors (the "Purchase
      Agreement").

     

    The
      Company and the Investors hereby agree as follows: 

     

    1.  Definitions.
      Capitalized terms used and not otherwise defined herein that are defined in
      the
      Purchase Agreement will have the meanings given such terms in the Purchase
      Agreement. As used in this Agreement, the following terms have the respective
      meanings set forth in this Section 1:

     

    “Advice”has
      the
      meaning set forth in Section 6(d).

     

    "Effective
      Date"
      means
      the date that the Registration Statement filed pursuant to Section 2(a) or
      2(b)
      is first declared effective by the Commission.

     

    “Effectiveness
      Date”
      means
      (a) with respect to the initial Registration Statement required to be filed
      under Section 2(a), the earlier of: (a)(i) the 120th
      day
      following the Closing Date; provided,
      that,
      if the Commission reviews and has written comments to the filed Registration
      Statement that would require the filing of a pre-effective amendment thereto
      with the Commission, then the Effectiveness Date under this clause (a)(i) shall
      be the 150th
      day
      following the Closing Date, and (ii) the fifth Trading Day following the date
      on
      which the Company is notified by the Commission that the initial Registration
      Statement will not be reviewed or is no longer subject to further review and
      comments; and (b) with respect to any additional Registration Statements that
      may be required pursuant to Section 2(b), the earlier of (i) the 120th
      day
      following (x) if such Registration Statement is required because the Commission
      shall have notified the Company in writing that certain Registrable Securities
      were not eligible for inclusion on a previously filed Registration Statement,
      the date or time on which the Commission shall indicate as being the first
      date
      or time that such Registrable Securities may then be included in a Registration
      Statement, or (y) if such Registration Statement is required for a reason other
      than as described in (x) above, the date on which the Company first knows,
      or
      reasonably should have known, that such additional Registration Statement(s)
      is
      required; provided,
      that,
      if the Commission reviews and has written comments to a Registration Statement
      filed under Section 2(b) that would require the filing of a pre-effective
      amendment thereto with the Commission, then the Effectiveness Date under this
      clause (b)(i) for such Registration Statement shall be the 150th
      day
      following the date that the Company first knows, or reasonably should have
      known, that such additional Registration Statement is required under such
      Section, and (ii) the fifth Trading Day following the date on which the Company
      is notified by the Commission that such additional Registration Statement will
      not be reviewed or is no longer subject to further review and comments; and
      (c)
      with respect to a Registration Statement required to be filed under Section
      2(c), the earlier of: (c)(i) the 90th
      day
      following the date on which the Company becomes eligible to utilize Form S-3
      to
      register the resale of Common Stock; provided,
      that,
      if the Commission reviews and has written comments to such filed Registration
      Statement that would require the filing of a pre-effective amendment thereto
      with the Commission, then the Effectiveness Date under this clause (c)(i) shall
      be the 120th
      day
      following the date on which the Company becomes eligible to utilize Form S-3
      to
      register the resale of Common Stock, and (ii) the fifth Trading Day following
      the date on which the Company is notified by the Commission that the initial
      Registration Statement will not be reviewed or is no longer subject to further
      review and comments

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    "Effectiveness
      Period"
      has the
      meaning set forth in Section 2(a).

     

    "Exchange
      Act"
      means
      the Securities Exchange Act of 1934, as amended.

     

    "Filing
      Date"
      means
      (a) with respect to the initial Registration Statement required to be filed
      under Section 2(a), the 45th
      day
      following the Closing Date; and (b) with respect to any additional Registration
      Statements that may be required pursuant to Section 2(b), the 45th
      day
      following (x) if such Registration Statement is required because the Commission
      shall have notified the Company in writing that certain Registrable Securities
      were not eligible for inclusion on a previously filed Registration Statement,
      the date or time on which the Commission shall indicate as being the first
      date
      or time that such Registrable Securities may then be included in a Registration
      Statement, or (y) if such Registration Statement is required for a reason other
      than as described in (x) above, the date on which the Company first knows,
      or
      reasonably should have known, that such additional Registration Statement(s)
      is
      required; and (c) with respect to a Registration Statement required to be filed
      under Section 2(c), the 30th
      day
      following the date on which the Company becomes eligible to utilize Form S-3
      to
      register the resale of Common Stock.

     

    "Holder"
      or
"Holders"
      means
      the holder or holders, as the case may be, from time to time of Registrable
      Securities.

     

    “Indemnified
      Party”
      has the
      meaning set forth in Section 5(c).

     

    “Indemnifying
      Party”
      has the
      meaning set forth in Section 5(c).

     

    “Losses”
      has the
      meaning set forth in Section 5(a).

     

    “New
      York Courts”
      means
      the state and federal courts sitting in the City of New York, Borough of
      Manhattan.

     

    "Proceeding"
      means an
      action, claim, suit, investigation or proceeding (including, without limitation,
      an investigation or partial proceeding, such as a deposition), whether commenced
      or threatened.

     

    
      
        
        

      

      
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    “Prospectus”
      means
      the prospectus included in a Registration Statement (including, without
      limitation, a prospectus that includes any information previously omitted from
      a
      prospectus filed as part of an effective registration statement in reliance
      upon
      Rule 430A promulgated under the Securities Act), as amended or supplemented
      by
      any prospectus supplement, with respect to the terms of the offering of any
      portion of the Registrable Securities covered by a Registration Statement,
      and
      all other amendments and supplements to the Prospectus, including post-effective
      amendments, and all material incorporated by reference or deemed to be
      incorporated by reference in such Prospectus.

     

    “Registrable
      Securities”
      means:
      (i) the Shares, (ii) the Warrant Shares and (iii) any securities issued or
      issuable upon any stock split, dividend or other distribution, recapitalization
      or similar event, or any conversion price adjustment with respect to any of
      the
      securities referenced in (i) or (ii) above.

     

    "Registration
      Statement"
      means
      the initial registration statement required to be filed in accordance with
      Section 2(a) and any additional registration statement(s) required to be filed
      under Section 2(b) and 2(c), including (in each case) the Prospectus, amendments
      and supplements to such registration statements or Prospectus, including pre-
      and post-effective amendments, all exhibits thereto, and all material
      incorporated by reference or deemed to be incorporated by reference
      therein.

     

    "Rule
      144"
      means
      Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
      Rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      Rule.

     

    "Rule
      415"
      means
      Rule 415 promulgated by the Commission pursuant to the Securities Act, as such
      Rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      Rule.

     

    "Rule
      424"
      means
      Rule 424 promulgated by the Commission pursuant to the Securities Act, as such
      Rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      Rule.

     

    "Securities
      Act"
      means
      the Securities Act of 1933, as amended.

     

    "Shares"
      means
      the shares of Common Stock issued or issuable to the Investors pursuant to
      the
      Purchase Agreement.

     

    “Warrants”means
      the
      Common Stock purchase warrants issued or issuable to the Investors pursuant
      to
      the Purchase Agreement and to any placement agent identified in Schedule
      3.1(u)
      to the
      Purchase Agreement in accordance with the terms of the engagement or similar
      agreements between the Company and any such agents.

     

    "Warrant
      Shares" means
      the
      shares of Common Stock issued or issuable upon exercise of the
      Warrants.

     

     

    
      
        
        

      

      
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    2.  Registration.

     

    (a)  On
      or
      prior to each Filing Date, the Company shall prepare and file with the
      Commission a Registration Statement covering the resale of all Registrable
      Securities not already covered by an existing and effective Registration
      Statement for an offering to be made on a continuous basis pursuant to Rule
      415,
      on Form SB-2 (or on such other form appropriate for such purpose). Such
      Registration Statement shall contain (except if otherwise required pursuant
      to
      written comments received from the Commission upon a review of such Registration
      Statement) the "Plan of Distribution" attached hereto as Annex A. The Company
      shall cause such Registration Statement to be declared effective under the
      Securities Act as soon as possible but, in any event, no later than its
      Effectiveness Date, and shall use its reasonable best efforts to keep the
      Registration Statement continuously effective under the Securities Act until
      the
      date which is the earlier of (i) five years after its Effective Date,
      (ii)
      such time as all of the Registrable Securities covered by such Registration
      Statement have been publicly sold by the Holders, or (iii) such time as all
      of
      the Registrable Securities covered by such Registration Statement may be sold
      by
      the Holders pursuant to Rule 144(k) as determined by the counsel to the Company
      pursuant to a written opinion letter to such effect, addressed and acceptable
      to
      the Company's transfer agent and the affected Holders (the "Effectiveness
      Period").

     

    (b)  If
      for
      any reason the Commission does not permit all of the Registrable Securities
      to
      be included in the Registration Statement filed pursuant to Section 2(a), or
      for
      any other reason any outstanding Registrable Securities are not then covered
      by
      an effective Registration Statement, then the Company shall prepare and file
      by
      the Filing Date for such Registration Statement, an additional Registration
      Statement covering the resale of all Registrable Securities not already covered
      by an existing and effective Registration Statement for an offering to be made
      on a continuous basis pursuant to Rule 415, on Form SB-2 (or on such other
      form
      appropriate for such purpose). Each such Registration Statement shall contain
      (except if otherwise required pursuant to written comments received from the
      Commission upon a review of such Registration Statement) the "Plan of
      Distribution" attached hereto as Annex
      A.
      The
      Company shall cause each such Registration Statement to be declared effective
      under the Securities Act as soon as possible but, in any event, by its
      Effectiveness Date, and shall use its reasonable best efforts to keep such
      Registration Statement continuously effective under the Securities Act during
      the entire Effectiveness Period. 

     

    (c)  Promptly
      following any date on which the Company becomes eligible to use a registration
      statement on Form S-3 to register the Registrable Securities for resale, the
      Company shall file a registration statement on Form S-3 covering the Registrable
      Securities (or a post-effective amendment on Form S-3 to the then effective
      Registration Statement) and shall cause such Registration Statement
      to be
      declared effective as soon as possible thereafter, but in any event prior to
      the
      Effectiveness Date therefor. Such Registration Statement shall contain (except
      if otherwise required pursuant to written comments received from the Commission
      upon a review of such Registration Statement) the "Plan of Distribution"
      attached hereto as Annex
      A.
      The
      Company shall cause such Registration Statement to be declared effective under
      the Securities Act as soon as possible but, in any event, by its Effectiveness
      Date, and shall use its reasonable best efforts to keep such Registration
      Statement continuously effective under the Securities Act during the entire
      Effectiveness Period. 

     

    
      
        
        

      

      
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    (d)   If:
      (i) a Registration Statement is not filed on or prior to its Filing Date (if
      the
      Company files a Registration Statement without affording the Holders the
      opportunity to review and comment on the same as required by Section 3(a)
      hereof, the Company shall not be deemed to have satisfied this clause (i)),
      or
      (ii) a Registration Statement is not declared effective by the Commission on
      or
      prior to its required Effectiveness Date, or (iii) after its Effective Date,
      without regard for the reason thereunder or efforts therefore, such Registration
      Statement ceases for any reason to be effective and available to the Holders
      as
      to all Registrable Securities to which it is required to cover at any time
      prior
      to the expiration of its Effectiveness Period for more than an aggregate of
      30
      Trading Days (which need not be consecutive) (any such failure or breach being
      referred to as an "Event,"
      and for
      purposes of clauses (i) or (ii) the date on which such Event occurs, or for
      purposes of clause (iii) the date which such 30 Trading Day-period is exceeded,
      being referred to as "Event
      Date"),
      then
      in addition to any other rights the Holders may have hereunder or under
      applicable law: (x) on each such Event Date the Company shall pay to each Holder
      an amount in cash, as partial liquidated damages and not as a penalty, equal
      to
      1.0% of the aggregate Investment Amount paid by such Holder for Shares pursuant
      to the Purchase Agreement; and (y) on each monthly anniversary of each such
      Event Date (if the applicable Event shall not have been cured by such date)
      until the applicable Event is cured, the Company shall pay to each Holder an
      amount in cash, as partial liquidated damages and not as a penalty, equal to
      2.0% of the aggregate Investment Amount paid by such Holder for Shares pursuant
      to the Purchase Agreement. The parties agree that the Company will not be liable
      for liquidated damages under this Section in respect of the Warrants. If the
      Company fails to pay any partial liquidated damages pursuant to this Section
      in
      full within seven days after the date payable, the Company will pay interest
      thereon at a rate of 10% per annum (or such lesser maximum amount that is
      permitted to be paid by applicable law) to the Holder, accruing daily from
      the
      date such partial liquidated damages are due until such amounts, plus all such
      interest thereon, are paid in full. The partial liquidated damages pursuant
      to
      the terms hereof shall apply on a daily pro-rata basis for any portion of a
      month prior to the cure of an Event, except in the case of the first Event
      Date.

     

    (e)  Each
      Holder agrees to furnish to the Company a completed Questionnaire in the form
      attached to this Agreement as Annex
      B
      (a
“Selling
      Holder Questionnaire”).
      The
      Company shall not be required to include the Registrable Securities of a Holder
      in a Registration Statement and shall not be required to pay any liquidated
      or
      other damages under Section 2(d) to any Holder who fails to furnish to the
      Company a fully completed Selling Holder Questionnaire at least two Trading
      Days
      prior to the Filing Date (subject to the requirements set forth in Section
      3(a)).

     

    3.  Registration
      Procedures.

     

    In
      connection with the Company's registration obligations hereunder, the Company
      shall:

     

    (a)  Not
      less
      than four Trading Days prior to the filing of a Registration Statement or any
      related Prospectus or any amendment or supplement thereto, the Company shall
      furnish to each Holder copies of the “Selling Stockholders” section of such
      document, the “Plan of Distribution” and any risk factor contained in such
      document that addresses specifically this transaction or the Selling
      Stockholders, as proposed to be filed which documents will be subject to the
      review of such Holder. The Company shall not file a Registration Statement,
      any
      Prospectus or any amendments or supplements thereto in which the “Selling
      Stockholder” section thereof differs from the disclosure received from a Holder
      in its Selling Holder Questionnaire (as amended or supplemented).

     

    
      
        
        

      

      
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    (b)  (i)
      Prepare and file with the Commission such amendments, including post-effective
      amendments, to each Registration Statement and the Prospectus used in connection
      therewith as may be necessary to keep such Registration Statement continuously
      effective as to the applicable Registrable Securities for its Effectiveness
      Period and prepare and file with the Commission such additional Registration
      Statements in order to register for resale under the Securities Act all of
      the
      Registrable Securities; (ii) cause the related Prospectus to be amended or
      supplemented by any required Prospectus supplement, and as so supplemented
      or
      amended to be filed pursuant to Rule 424; (iii) respond as promptly as
      reasonably possible to any comments received from the Commission with respect
      to
      each Registration Statement or any amendment thereto and, as promptly as
      reasonably possible provide the Holders true and complete copies of all
      correspondence from and to the Commission relating to such Registration
      Statement that would not result in the disclosure to the Holders of material
      and
      non-public information concerning the Company; and (iv) comply in all material
      respects with the provisions of the Securities Act and the Exchange Act with
      respect to the Registration Statements and the disposition of all Registrable
      Securities covered by each Registration Statement.

     

    (c)  Notify
      the Holders as promptly as reasonably possible (and, in the case of (i)(A)
      below, not less than three Trading Days prior to such filing) and (if requested
      by any such Person) confirm such notice in writing no later than one Trading
      Day
      following the day (i)(A) when a Prospectus or any Prospectus supplement or
      post-effective amendment to a Registration Statement is proposed to be filed;
      (B) when the Commission notifies the Company whether there will be a "review"
      of
      such Registration Statement and whenever the Commission comments in writing
      on
      such Registration Statement (the Company shall provide true and complete copies
      thereof and all written responses thereto to each of the Holders that pertain
      to
      the Holders as a Selling Stockholder or to the Plan of Distribution, but not
      information which the Company believes would constitute material and non-public
      information); and (C) with respect to each Registration Statement or any
      post-effective amendment, when the same has become effective; (ii) of any
      request by the Commission or any other Federal or state governmental authority
      for amendments or supplements to a Registration Statement or Prospectus or
      for
      additional information; (iii) of the issuance by the Commission of any stop
      order suspending the effectiveness of a Registration Statement covering any
      or
      all of the Registrable Securities or the initiation of any Proceedings for
      that
      purpose; (iv) of the receipt by the Company of any notification with respect
      to
      the suspension of the qualification or exemption from qualification of any
      of
      the Registrable Securities for sale in any jurisdiction, or the initiation
      or
      threatening of any Proceeding for such purpose; and (v) of the occurrence of
      any
      event or passage of time that makes the financial statements included in a
      Registration Statement ineligible for inclusion therein or any statement made
      in
      such Registration Statement or Prospectus or any document incorporated or deemed
      to be incorporated therein by reference untrue in any material respect or that
      requires any revisions to such Registration Statement, Prospectus or other
      documents so that, in the case of such Registration Statement or the Prospectus,
      as the case may be, it will not contain any untrue statement of a material
      fact
      or omit to state any material fact required to be stated therein or necessary
      to
      make the statements therein, in light of the circumstances under which they
      were
      made, not misleading.

     

    
      
        
        

      

      
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    (d)  Use
      its
      reasonable best efforts to avoid the issuance of, or, if issued, obtain the
      withdrawal of (i) any order suspending the effectiveness of a Registration
      Statement, or (ii) any suspension of the qualification (or exemption from
      qualification) of any of the Registrable Securities for sale in any
      jurisdiction, at the earliest practicable moment.

     

    (e)  Furnish
      to each Holder, without charge, at least one conformed copy of each Registration
      Statement and each amendment thereto and all exhibits to the extent requested
      by
      such Person (including those previously furnished) promptly after the filing
      of
      such documents with the Commission.

     

    (f)  Promptly
      deliver to each Holder, without charge, as many copies of each Prospectus or
      Prospectuses (including each form of prospectus) and each amendment or
      supplement thereto as such Persons may reasonably request. The Company hereby
      consents to the use of such Prospectus and each amendment or supplement thereto
      by each of the selling Holders in connection with the offering and sale of
      the
      Registrable Securities covered by such Prospectus and any amendment or
      supplement thereto.

     

    (g)  Prior
      to
      any public offering of Registrable Securities, to register or qualify or
      cooperate with the selling Holders in connection with the registration or
      qualification (or exemption from such registration or qualification) of such
      Registrable Securities for offer and sale under the securities or Blue Sky
      laws
      of all jurisdictions within the United States, to keep each such registration
      or
      qualification (or exemption therefrom) effective during the Effectiveness Period
      and to do any and all other acts or things necessary or advisable to enable
      the
      disposition in such jurisdictions of the Registrable Securities covered by
      the
      Registration Statements.

     

    (h)  Cooperate
      with the Holders to facilitate the timely preparation and delivery of
      certificates representing Registrable Securities to be delivered to a transferee
      pursuant to the Registration Statements, which certificates shall be free,
      to
      the extent permitted by the Purchase Agreement, of all restrictive legends,
      and
      to enable such Registrable Securities to be in such denominations and registered
      in such names as any such Holders may request.

     

    (i)  Upon
      the
      occurrence of any event contemplated by Section 3(c)(v), as promptly as
      reasonably possible, prepare a supplement or amendment, including a
      post-effective amendment, to the affected Registration Statements or a
      supplement to the related Prospectus or any document incorporated or deemed
      to
      be incorporated therein by reference, and file any other required document
      so
      that, as thereafter delivered, no Registration Statement nor any Prospectus
      will
      contain an untrue statement of a material fact or omit to state a material
      fact
      required to be stated therein or necessary to make the statements therein,
      in
      light of the circumstances under which they were made, not
      misleading.

     

    
      
        
        

      

      
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    4.  Registration
      Expenses.
      All
      fees and expenses incident to the performance of or compliance with this
      Agreement by the Company shall be borne by the Company whether or not any
      Registrable Securities are sold pursuant to a Registration Statement. The fees
      and expenses referred to in the foregoing sentence shall include, without
      limitation, (i) all registration and filing fees (including, without limitation,
      fees and expenses (A) with respect to filings required to be made with any
      Trading Market on which the Common Stock is then listed for trading, and (B)
      in
      compliance with applicable state securities or Blue Sky laws), (ii) printing
      expenses (including, without limitation, expenses of printing certificates
      for
      Registrable Securities and of printing prospectuses if the printing of
      prospectuses is reasonably requested by the holders of a majority of the
      Registrable Securities included in the Registration Statement), (iii) messenger,
      telephone and delivery expenses, (iv) fees and disbursements of counsel for
      the
      Company, (v) Securities Act liability insurance, if the Company so desires
      such
      insurance, and (vi) fees and expenses of all other Persons retained by the
      Company in connection with the consummation of the transactions contemplated
      by
      this Agreement. In addition, the Company shall be responsible for all of its
      internal expenses incurred in connection with the consummation of the
      transactions contemplated by this Agreement (including, without limitation,
      all
      salaries and expenses of its officers and employees performing legal or
      accounting duties), the expense of any annual audit and the fees and expenses
      incurred in connection with the listing of the Registrable Securities on any
      securities exchange as required hereunder.

     

    5.  Indemnification.

     

    (a)  Indemnification
      by the Company.
      The
      Company shall, notwithstanding any termination of this Agreement, indemnify
      and
      hold harmless each Holder, the officers, directors, agents, investment advisors,
      partners, members and employees of each of them, each Person who controls any
      such Holder (within the meaning of Section 15 of the Securities Act or Section
      20 of the Exchange Act) and the officers, directors, agents and employees of
      each such controlling Person, to the fullest extent permitted by applicable
      law,
      from and against any and all losses, claims, damages, liabilities, costs
      (including, without limitation, reasonable costs of preparation and reasonable
      attorneys' fees) and expenses (collectively, "Losses"),
      as
      incurred, arising out of or relating to any untrue or alleged untrue statement
      of a material fact contained in any Registration Statement, any Prospectus
      or
      any form of prospectus or in any amendment or supplement thereto or in any
      preliminary prospectus, or arising out of or relating to any omission or alleged
      omission of a material fact required to be stated therein or necessary to make
      the statements therein (in the case of any Prospectus or form of prospectus
      or
      supplement thereto, in light of the circumstances under which they were made)
      not misleading, except to the extent, but only to the extent, that (1) such
      untrue statements or omissions are based solely upon information regarding
      such
      Holder furnished in writing to the Company by such Holder expressly for use
      therein, or to the extent that such information relates to such Holder or such
      Holder's proposed method of distribution of Registrable Securities and was
      reviewed and expressly approved in writing by such Holder expressly for use
      in
      the Registration Statement, such Prospectus or such form of Prospectus or in
      any
      amendment or supplement thereto (it being understood that the Holder has
      approved Annex A hereto for this purpose) or (2) in the case of an occurrence
      of
      an event of the type specified in Section 3(c)(ii)-(v), the use by such Holder
      of an outdated or defective Prospectus after the Company has notified such
      Holder in writing that the Prospectus is outdated or defective and prior to
      the
      receipt by such Holder of an Advice or an amended or supplemented Prospectus,
      but only if and to the extent that following the receipt of the Advice or the
      amended or supplemented Prospectus the misstatement or omission giving rise
      to
      such Loss would have been corrected. The Company shall notify the Holders
      promptly of the institution, threat or assertion of any Proceeding of which
      the
      Company is aware in connection with the transactions contemplated by this
      Agreement.

     

    
      
        
        

      

      
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    (b)  Indemnification
      by Holders.
      Each
      Holder shall, severally and not jointly, indemnify and hold harmless the
      Company, its directors, officers, agents and employees, each Person who controls
      the Company (within the meaning of Section 15 of the Securities Act and Section
      20 of the Exchange Act), and the directors, officers, agents or employees of
      such controlling Persons, to the fullest extent permitted by applicable law,
      from and against all Losses, as incurred, arising solely out of or based solely
      upon: (x) such Holder's failure to comply with the prospectus delivery
      requirements of the Securities Act or (y) any untrue statement of a material
      fact contained in any Registration Statement, any Prospectus, or any form of
      prospectus, or in any amendment or supplement thereto, or arising solely out
      of
      or based solely upon any omission of a material fact required to be stated
      therein or necessary to make the statements therein not misleading to the
      extent, but only to the extent that, (1) such untrue statements or omissions
      are
      based solely upon information regarding such Holder furnished in writing to
      the
      Company by such Holder expressly for use therein, or to the extent that such
      information relates to such Holder or such Holder's proposed method of
      distribution of Registrable Securities and was reviewed and expressly approved
      in writing by such Holder expressly for use in the Registration Statement (it
      being understood that the Holder has approved Annex A hereto for this purpose),
      such Prospectus or such form of Prospectus or in any amendment or supplement
      thereto or (2) in the case of an occurrence of an event of the type specified
      in
      Section 3(c)(ii)-(v), the use by such Holder of an outdated or defective
      Prospectus after the Company has notified such Holder in writing that the
      Prospectus is outdated or defective and prior to the receipt by such Holder
      of
      an Advice or an amended or supplemented Prospectus, but only if and to the
      extent that following the receipt of the Advice or the amended or supplemented
      Prospectus the misstatement or omission giving rise to such Loss would have
      been
      corrected. In no event shall the liability of any selling Holder hereunder
      be
      greater in amount than the dollar amount of the net proceeds received by such
      Holder upon the sale of the Registrable Securities giving rise to such
      indemnification obligation.

     

    (c)  Conduct
      of Indemnification Proceedings.
      If any
      Proceeding shall be brought or asserted against any Person entitled to indemnity
      hereunder (an "Indemnified
      Party"),
      such
      Indemnified Party shall promptly notify the Person from whom indemnity is sought
      (the "Indemnifying
      Party")
      in
      writing, and the Indemnifying Party shall assume the defense thereof, including
      the employment of counsel reasonably satisfactory to the Indemnified Party
      and
      the payment of all fees and expenses incurred in connection with defense
      thereof; provided, that the failure of any Indemnified Party to give such notice
      shall not relieve the Indemnifying Party of its obligations or liabilities
      pursuant to this Agreement, except (and only) to the extent that it shall be
      finally determined by a court of competent jurisdiction (which determination
      is
      not subject to appeal or further review) that such failure shall have
      proximately and materially adversely prejudiced the Indemnifying
      Party.

     

    An
      Indemnified Party shall have the right to employ separate counsel in any such
      Proceeding and to participate in the defense thereof, but the fees and expenses
      of such counsel shall be at the expense of such Indemnified Party or Parties
      unless: (1) the Indemnifying Party has agreed in writing to pay such fees and
      expenses; (2) the Indemnifying Party shall have failed promptly to assume the
      defense of such Proceeding and to employ counsel reasonably satisfactory to
      such
      Indemnified Party in any such Proceeding; or (3) the named parties to any such
      Proceeding (including any impleaded parties) include both such Indemnified
      Party
      and the Indemnifying Party, and such Indemnified Party shall have been advised
      by counsel that a conflict of interest is likely to exist if the same counsel
      were to represent such Indemnified Party and the Indemnifying Party (in which
      case, if such Indemnified Party notifies the Indemnifying Party in writing
      that
      it elects to employ separate counsel at the expense of the Indemnifying Party,
      the Indemnifying Party shall not have the right to assume the defense thereof
      and such counsel shall be at the expense of the Indemnifying Party). The
      Indemnifying Party shall not be liable for any settlement of any such Proceeding
      effected without its written consent, which consent shall not be unreasonably
      withheld. No Indemnifying Party shall, without the prior written consent of
      the
      Indemnified Party (which consent shall not be unreasonably withheld), effect
      any
      settlement of any pending Proceeding in respect of which any Indemnified Party
      is a party, unless such settlement includes an unconditional release of such
      Indemnified Party from all liability on claims that are the subject matter
      of
      such Proceeding.

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

    All
      fees
      and expenses of the Indemnified Party (including reasonable fees and expenses
      to
      the extent incurred in connection with investigating or preparing to defend
      such
      Proceeding in a manner not inconsistent with this Section) shall be paid to
      the
      Indemnified Party, as incurred, within ten Trading Days of written notice
      thereof to the Indemnifying Party (regardless of whether it is ultimately
      determined that an Indemnified Party is not entitled to indemnification
      hereunder; provided, that the Indemnifying Party may require such Indemnified
      Party to undertake to reimburse all such fees and expenses to the extent it
      is
      finally judicially determined that such Indemnified Party is not entitled to
      indemnification hereunder).

     

    (d)  Contribution.
      If a
      claim for indemnification under Section 5(a) or 5(b) is unavailable to an
      Indemnified Party (by reason of public policy or otherwise), then each
      Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
      contribute to the amount paid or payable by such Indemnified Party as a result
      of such Losses, in such proportion as is appropriate to reflect the relative
      fault of the Indemnifying Party and Indemnified Party in connection with the
      actions, statements or omissions that resulted in such Losses as well as any
      other relevant equitable considerations. The relative fault of such Indemnifying
      Party and Indemnified Party shall be determined by reference to, among other
      things, whether any action in question, including any untrue or alleged untrue
      statement of a material fact or omission or alleged omission of a material
      fact,
      has been taken or made by, or relates to information supplied by, such
      Indemnifying Party or Indemnified Party, and the parties' relative intent,
      knowledge, access to information and opportunity to correct or prevent such
      action, statement or omission. The amount paid or payable by a party as a result
      of any Losses shall be deemed to include, subject to the limitations set forth
      in Section 5(c), any reasonable attorneys' or other reasonable fees or expenses
      incurred by such party in connection with any Proceeding to the extent such
      party would have been indemnified for such fees or expenses if the
      indemnification provided for in this Section was available to such party in
      accordance with its terms.

     

    The
      parties hereto agree that it would not be just and equitable if contribution
      pursuant to this Section 5(d) were determined by pro rata allocation or by
      any
      other method of allocation that does not take into account the equitable
      considerations referred to in the immediately preceding paragraph.
      Notwithstanding the provisions of this Section 5(d), no Holder shall be required
      to contribute, in the aggregate, any amount in excess of the amount by which
      the
      proceeds actually received by such Holder from the sale of the Registrable
      Securities subject to the Proceeding exceeds the amount of any damages that
      such
      Holder has otherwise been required to pay by reason of such untrue or alleged
      untrue statement or omission or alleged omission.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

    The
      indemnity and contribution agreements contained in this Section are in addition
      to any liability that the Indemnifying Parties may have to the Indemnified
      Parties.

     

    6.  Miscellaneous.

     

    (a)  Remedies.
      In the
      event of a breach by the Company or by a Holder, of any of their obligations
      under this Agreement, each Holder or the Company, as the case may be, in
      addition to being entitled to exercise all rights granted by law and under
      this
      Agreement, including recovery of damages, will be entitled to specific
      performance of its rights under this Agreement. The Company and each Holder
      agree that monetary damages would not provide adequate compensation for any
      losses incurred by reason of a breach by it of any of the provisions of this
      Agreement and hereby further agrees that, in the event of any action for
      specific performance in respect of such breach, it shall waive the defense
      that
      a remedy at law would be adequate.

     

    (b)  No
      Piggyback on Registrations.
      Except
      as and to the extent specified in Schedule 3.1(v) to the Purchase Agreement,
      neither the Company nor any of its security holders (other than the Holders
      in
      such capacity pursuant hereto) may include securities of the Company in a
      Registration Statement other than the Registrable Securities.

     

    (c)  Compliance.
      Each
      Holder covenants and agrees that it will comply with the prospectus delivery
      requirements of the Securities Act as applicable to it in connection with sales
      of Registrable Securities pursuant to the Registration Statement.

     

    (d)  Discontinued
      Disposition.
      Each
      Holder agrees by its acquisition of such Registrable Securities that, upon
      receipt of a notice from the Company of the occurrence of any event of the
      kind
      described in Section 3(c), such Holder will forthwith discontinue disposition
      of
      such Registrable Securities under the Registration Statement until such Holder's
      receipt of the copies of the supplemented Prospectus and/or amended Registration
      Statement or until it is advised in writing (the "Advice")
      by the
      Company that the use of the applicable Prospectus may be resumed, and, in either
      case, has received copies of any additional or supplemental filings that are
      incorporated or deemed to be incorporated by reference in such Prospectus or
      Registration Statement. The Company may provide appropriate stop orders to
      enforce the provisions of this paragraph.

     

    (e)  Piggy-Back
      Registrations.
      If at
      any time during the Effectiveness Period there is not an effective Registration
      Statement covering all of the Registrable Securities and the Company shall
      determine to prepare and file with the Commission a registration statement
      relating to an offering for its own account or the account of others under
      the
      Securities Act of any of its equity securities, other than on Form S-4 or Form
      S-8 (each as promulgated under the Securities Act) or their then equivalents
      relating to equity securities to be issued solely in connection with any
      acquisition of any entity or business or equity securities issuable in
      connection with stock option or other employee benefit plans, then the Company
      shall send to each Holder written notice of such determination and, if within
      fifteen days after receipt of such notice, any such Holder shall so request
      in
      writing, the Company shall include in such registration statement all or any
      part of such Registrable Securities such holder requests to be registered,
      subject to customary underwriter cutbacks applicable to all holders of
      registration rights.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

    (f)  Amendments
      and Waivers.
      The
      provisions of this Agreement, including the provisions of this Section 6(f),
      may
      not be amended, modified or supplemented, and waivers or consents to departures
      from the provisions hereof may not be given, unless the same shall be in writing
      and signed by the Company and the Holders of no less than a majority in interest
      of the then outstanding Registrable Securities. Notwithstanding the foregoing,
      a
      waiver or consent to depart from the provisions hereof with respect to a matter
      that relates exclusively to the rights of certain Holders and that does not
      directly or indirectly affect the rights of other Holders may be given by
      Holders of at least a majority of the Registrable Securities to which such
      waiver or consent relates.

     

    (g)  Notices.
      Any and
      all notices or other communications or deliveries required or permitted to
      be
      provided hereunder shall be in writing and shall be deemed given and effective
      on the earliest of (a) the date of transmission, if such notice or communication
      is delivered via facsimile (provided the sender receives a machine-generated
      confirmation of successful transmission) at the facsimile number specified
      in
      this Section prior to 6:30 p.m. (New York City time) on a Trading Day, (b)
      the
      next Trading Day after the date of transmission, if such notice or communication
      is delivered via facsimile at the facsimile number specified in this Section
      on
      a day that is not a Trading Day or later than 6:30 p.m. (New York City time)
      on
      any Trading Day, (c) the Trading Day following the date of mailing, if sent
      by
      U.S. nationally recognized overnight courier service, or (d) upon actual receipt
      by the party to whom such notice is required to be given. The address for such
      notices and communications shall be as follows:

     

    
      
        	 If to the Company:	21098 Bake Parkway
	 	Suite 100
	 	Lake Forest, CA 92630-2163
	 	Attention: Chief Financial
                Officer
	 	Facsimile No.: (949) 470-9420
	 	 
	 With a copy to:  	Rein Evans & Sestanovich LLP
	 	1925 Century Park East, 16th
                Floor
	 	Los Angeles, CA 90067
	 	Facsimile No.: (310) 551-0238
	 	Attn: Douglas K. Simpson, Esq.
	 	 
	 If to a Investor:	To
                the address set forth under such Investor's name on the signature
                pages
                hereto.
	 	 
	 If to any other Person
                who is
                then the registered Holder:
	 	 
	
                 To
                  the address of such Holder as it
                  appears in the stock transfer books of the
                  Company

              

      

    

     

    or
      such
      other address as may be designated in writing hereafter, in the same manner,
      by
      such Person.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

       

    

    (h)  Successors
      and Assigns.
      This
      Agreement shall inure to the benefit of and be binding upon the successors
      and
      permitted assigns of each of the parties and shall inure to the benefit of
      each
      Holder. The Company may not assign its rights or obligations hereunder without
      the prior written consent of each Holder. Each Holder may assign their
      respective rights hereunder in the manner and to the Persons as permitted under
      the Purchase Agreement.

     

    (i)  Execution
      and Counterparts.
      This
      Agreement may be executed in any number of counterparts, each of which when
      so
      executed shall be deemed to be an original and, all of which taken together
      shall constitute one and the same Agreement. In the event that any signature
      is
      delivered by facsimile transmission, such signature shall create a valid binding
      obligation of the party executing (or on whose behalf such signature is
      executed) the same with the same force and effect as if such facsimile signature
      were the original thereof.

     

    (j)  Governing
      Law.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Agreement shall be governed by and construed and enforced in accordance
      with the internal laws of the State of New York, without regard to the
      principles of conflicts of law thereof. Each party agrees that all Proceedings
      concerning the interpretations, enforcement and defense of the transactions
      contemplated by this Agreement (whether brought against a party hereto or its
      respective Affiliates, employees or agents) will be commenced in the New York
      Courts. Each party hereto hereby irrevocably submits to the exclusive
      jurisdiction of the New York Courts for the adjudication of any dispute
      hereunder or in connection herewith or with any transaction contemplated hereby
      or discussed herein, and hereby irrevocably waives, and agrees not to assert
      in
      any Proceeding, any claim that it is not personally subject to the jurisdiction
      of any New York Court, or that such Proceeding has been commenced in an improper
      or inconvenient forum. Each party hereto hereby irrevocably waives personal
      service of process and consents to process being served in any such Proceeding
      by mailing a copy thereof via registered or certified mail or overnight delivery
      (with evidence of delivery) to such party at the address in effect for notices
      to it under this Agreement and agrees that such service shall constitute good
      and sufficient service of process and notice thereof. Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any manner
      permitted by law. Each party hereto hereby irrevocably waives, to the fullest
      extent permitted by applicable law, any and all right to trial by jury in any
      Proceeding arising out of or relating to this Agreement or the transactions
      contemplated hereby. If either party shall commence a Proceeding to enforce
      any
      provisions of this Agreement, then the prevailing party in such Proceeding
      shall
      be reimbursed by the other party for its attorney’s fees and other costs and
      expenses incurred with the investigation, preparation and prosecution of such
      Proceeding.

     

    (k)  Cumulative
      Remedies.
      The
      remedies provided herein are cumulative and not exclusive of any remedies
      provided by law.

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

       

    

    (l)  Severability.
      If any
      term, provision, covenant or restriction of this Agreement is held by a court
      of
      competent jurisdiction to be invalid, illegal, void or unenforceable, the
      remainder of the terms, provisions, covenants and restrictions set forth herein
      shall remain in full force and effect and shall in no way be affected, impaired
      or invalidated, and the parties hereto shall use their reasonable efforts to
      find and employ an alternative means to achieve the same or substantially the
      same result as that contemplated by such term, provision, covenant or
      restriction. It is hereby stipulated and declared to be the intention of the
      parties that they would have executed the remaining terms, provisions, covenants
      and restrictions without including any of such that may be hereafter declared
      invalid, illegal, void or unenforceable.

     

    (m)  Headings.
      The
      headings in this Agreement are for convenience of reference only and shall
      not
      limit or otherwise affect the meaning hereof.

     

    (n)  Independent
      Nature of Investors' Obligations and Rights.
      The
      obligations of each Investor under this Agreement are several and not joint
      with
      the obligations of each other Investor, and no Investor shall be responsible
      in
      any way for the performance of the obligations of any other Investor under
      this
      Agreement. 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 this Agreement or any other Transaction Document. Each Investor
      acknowledges that no other Investor will be acting as agent of such Investor
      in
      enforcing its rights under this Agreement. Each Investor shall be entitled
      to
      independently protect and enforce its rights, including without limitation
      the
      rights arising out of this Agreement, and it shall not be necessary for any
      other 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 Registration Rights Agreement for the purpose of closing a
      transaction with multiple Investors and not because it was required or requested
      to do so by any Investor.

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGES TO FOLLOW]

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

    

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

     

     

    
      	 	 	 
	 	THE
              BLUEBOOK INTERNATIONAL HOLDING COMPANY
	 
 	 
 	 
 
	 	By:  	/s/ 
              Mark A. Josipovich
	 	
              
                

              

              Name: Mark A. Josipovich

              Title: Chief Executive Officer

            
	 	 

    

     

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGES OF INVESTORS TO FOLLOW]

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        	 	 	 
	 	NAME
                OF INVESTING ENTITY
	 	 
	 
 	 
 	 
 Roaring
                Fork Capital SBIC, L.P.
	 	 	 By Roaring Fork Capital Management,
                LLC
	 	 	 Its
                general partner
	 	 	 
	 	By:  	/s/ Eugene
                C. McColley
	 	
                
                  

                

                Name: Eugene
                  C. McColley

                Title: Manager

              
	 	 

      

      
        	 	 	 
	 	ADDRESS
                FOR NOTICE
	 
 	 
 	 
 
	 	        
                  	c/o:
	 	
                
                  

                

                 

              
	 	 Street: 
                

              
	 	 City/State/Zip:
                

              
	 	 Attention:
                

              
	 	 Tel:  
                

              
	 	 Fax: 

                

              

      

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        
          	 	 	 
	 	NAME
                  OF INVESTOR
	 	 
	 
 	 
 	 
 MicroCapital
                  Fund LP
	 	 	 
	 	 	 
	 	By:  	/s/ Ian
                  P. Ellis
	 	
                  
                    

                  

                  Name: Ian
                    P. Ellis

                  Title: President,
                    MicroCapital LLC

                
	 	 

        

        
          	 	 	 
	 	ADDRESS
                  FOR NOTICE
	 
 	 
 	 
 
	 	        
                    	c/o:
	 	
                  
                    

                  

                   

                
	 	 Street: 
                  

                
	 	 City/State/Zip:
                  

                
	 	 Attention:
                  

                
	 	 Tel:  
                  

                
	 	 Fax: 

                  

                

        

      

    

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        
          	 	 	 
	 	NAME
                  OF INVESTOR
	 	 
	 
 	 
 	 
 MicroCapital
                  Fund LP
	 	 	 
	 	 	 
	 	By:  	/s/ Ian
                  P. Ellis
	 	
                  
                    

                  

                  Name: Ian
                    P. Ellis

                  Title: President,
                    MicroCapital LLC

                
	 	 

        

        
          	 	 	 
	 	ADDRESS
                  FOR NOTICE
	 
 	 
 	 
 
	 	        
                    	c/o:
	 	
                  
                    

                  

                   

                
	 	 Street: 
                  

                
	 	 City/State/Zip:
                  

                
	 	 Attention:
                  

                
	 	 Tel:  
                  

                
	 	 Fax: 

                  

                

        

      

    

     

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

       

    

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

       

      
        
          
            	 	 	 
	 	NAME
                    OF INVESTING ENTITY
	 	 
	 
 	 
 	 
 GEARY
                    PARTNERS L.P.
	 	 	 
	 	 	 
	 	By:  	/s/ William
                    J. Brady
	 	
                    
                      

                    

                    Name: William
                      J. Brady

                    Title: General
                      Partner

                  
	 	 

          

          
            	 	 	 
	 	ADDRESS
                    FOR NOTICE
	 
 	 
 	 
 
	 	        
                      	c/o:
	 	
                    
                      

                    

                     

                  
	 	 Street: 
                    

                  
	 	 City/State/Zip:
                    

                  
	 	 Attention:
                    

                  
	 	 Tel:  
                    

                  
	 	 Fax: 

                    

                  

          

        

      

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

       

    

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

     

    
       

      
        
          
            	 	 	 
	 	NAME
                    OF INVESTING ENTITY
	 	 
	 
 	 
 	 
 PRESIDIO
                    PARTNERS L.P.
	 	 	 
	 	 	 
	 	By:  	/s/ William
                    J. Brady
	 	
                    
                      

                    

                    Name: William
                      J. Brady

                    Title: General
                      Partner

                  
	 	 

          

          
            	 	 	 
	 	ADDRESS
                    FOR NOTICE
	 
 	 
 	 
 
	 	        
                      	c/o:
	 	
                    
                      

                    

                     

                  
	 	 Street: 
                    

                  
	 	 City/State/Zip:
                    

                  
	 	 Attention:
                    

                  
	 	 Tel:  
                    

                  
	 	 Fax: 

                    

                  

          

        

      

       

    

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

       

    

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

    
       

      
        
          
            
              	 	 	 
	 	NAME
                      OF INVESTING ENTITY
	 	 
	 
 	 
 	 
BRADY
                      RETIREMENT FUND L.P.
	 	 	 
	 	 	 
	 	By:  	/s/ William
                      J. Brady
	 	
                      
                        

                      

                      Name: William
                        J. Brady

                      Title: General
                        Partner

                    
	 	 

            

            
              	 	 	 
	 	ADDRESS
                      FOR NOTICE
	 
 	 
 	 
 
	 	        
                        	c/o:
	 	
                      
                        

                      

                       

                    
	 	 Street: 
                      

                    
	 	 City/State/Zip:
                      

                    
	 	 Attention:
                      

                    
	 	 Tel:  
                      

                    
	 	 Fax: 

                      

                    

            

          

        

         

      

    

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        
          	 	 	 
	 	NAME
                  OF INVESTOR
	 	 
	 
 	 
 	 
BTG
                  Investments, LLC
	 	 	 
	 	 	 
	 	By:  	/s/ Gordon
                  Roth
	 	
                  
                    

                  

                  Name: Gordon
                    Roth

                  Title: Manager

                
	 	 

        

        
          	 	 	 
	 	ADDRESS
                  FOR NOTICE
	 
 	 
 	 
 
	 	        
                    	c/o:
	 	
                  
                    

                  

                   

                
	 	 Street: 
                  

                
	 	 City/State/Zip:
                  

                
	 	 Attention:
                  

                
	 	 Tel:  
                  

                
	 	 Fax: 

                  

                

        

      

    

    

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

       

    

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

    
       

      
        
          
            	 	 	 
	 	NAME
                    OF INVESTING ENTITY
	 	 
	 
 	 
 	 

	 	 	 
	 	 	 
	 	By:  	/s/ Margaret
                    M. Bathgate
	 	
                    
                      

                    

                    Name: Margaret
                      M. Bathgate

                    Title: 

                  
	 	 

          

          
            	 	 	 
	 	ADDRESS
                    FOR NOTICE
	 
 	 
 	 
 
	 	        
                      	c/o:
	 	
                    
                      

                    

                     

                  
	 	 Street: 
                    

                  
	 	 City/State/Zip:
                    

                  
	 	 Attention:
                    

                  
	 	 Tel:  
                    

                  
	 	 Fax: 

                    

                  

          

        

      

    

    

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        	
              	 	 
	 	NAME
                OF INVESTOR
	 	 
	 
 	 
 	 
Stephen
                J. Hutsko
	 	 	 TTEE FBO The Hutsko Living Trust U/T/D
	 	 	 03/12/04
	 	 	 
	 	By:  	/s/ Stephen
                J. Hutsko
	 	
                
                  

                

                Name: Stephen
                  J. Hutsko

                Title: 

              
	 	 Investment Amount: $59,955.00 (57,100
                shares)

      

      
        	 	 	 Tax
                ID No.: ###-##-####
	 	 	 
	 	ADDRESS
                FOR NOTICE
	 
 	 
 	 
 
	 	        
                  	c/o:
	 	
                
                  

                

                 

              
	 	 Street: 
                

              
	 	 City/State/Zip:
                

              
	 	 Attention:
                

              
	 	 Tel:  
                

              
	 	 Fax: 

                

              

      

    

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        
          	
                	 	 
	 	NAME
                  OF INVESTOR
	 	 
	 
 	 
 	 
Joseph
                  Paul Schimmelpfennig
	 	 	 
	 	By:  	/s/ Joseph
                  Paul Schimmelpfennig
	 	
                  
                    

                  

                  Name: Joseph
                    Paul Schimmelpfennig

                  Title: 

                
	 	 Investment Amount: $47,250.00 (45,000
                  shares)

        

        
          	 	 	 Tax
                  ID No.: ###-##-####
	 	 	 
	 	ADDRESS
                  FOR NOTICE
	 
 	 
 	 
 
	 	        
                    	c/o:
	 	
                  
                    

                  

                   

                
	 	 Street: 
                  

                
	 	 City/State/Zip:
                  

                
	 	 Attention:
                  

                
	 	 Tel:  
                  

                
	 	 Fax: 

                  

                

        

      

    

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

       

    

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

     

    
      
        
          
            	 	 	 
	 	NAME
                    OF INVESTING ENTITY
	 	 
	 
 	 
 	 

	 	 	 
	 	 	 
	 	By:  	/s/ Gordon
                    J. Roth
	 	
                    
                      

                    

                    Name: Gordon
                      J. Roth

                    
                      Title: Manager

                    

                  
	 	 

          

          
            	 	 	 
	 	ADDRESS
                    FOR NOTICE
	 
 	 
 	 
 
	 	        
                      	c/o:
	 	
                    
                      

                    

                     

                  
	 	 Street: 
                    

                  
	 	 City/State/Zip:
                    

                  
	 	 Attention:
                    

                  
	 	 Tel:  
                    

                  
	 	 Fax: 

                    

                  

          

        

      

      

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

    

     

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

     

    
      
        
          
            
              	 	 	 
	 	NAME
                      OF INVESTING ENTITY
	 	 
	 
 	 
 	 

	 	 	 
	 	 	 
	 	By:  	/s/ John
                      J. Weber
	 	
                      
                        

                      

                      Name: John
                        J. Weber

                      
                        Title: 

                      

                    
	 	 

            

            
              	 	 	 
	 	ADDRESS
                      FOR NOTICE
	 
 	 
 	 
 
	 	        
                        	c/o:
	 	
                      
                        

                      

                       

                    
	 	 Street: 
                      

                    
	 	 City/State/Zip:
                      

                    
	 	 Attention:
                      

                    
	 	 Tel:  
                      

                    
	 	 Fax: 

                      

                    

            

          

        

         

        
          
            
            

          

          
            27

            
              

            

          

          
            
            

          

           

        

      

    

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

     

    
      
        
          
            	 	 	 
	 	NAME
                    OF INVESTING ENTITY
	 	 
	 
 	 
 	 
Jeffrey
                    M. Ng
	 	 	 
	 	 	 
	 	By:  	/s/ Jeffrey
                    M. Ng
	 	
                    
                      

                    

                    Name: Jeffrey
                      M. Ng

                    
                      Title: 

                    

                  
	 	 

          

          
            	 	 	 
	 	ADDRESS
                    FOR NOTICE
	 
 	 
 	 
 
	 	        
                      	c/o:
	 	
                    
                      

                    

                     

                  
	 	 Street: 
                    

                  
	 	 City/State/Zip:
                    

                  
	 	 Attention:
                    

                  
	 	 Tel:  
                    

                  
	 	 Fax: 

                    

                  

          

        

      

       

      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

    

    

    Annex
      A

     

    Plan
      of
      Distribution

     

    The
      Selling Stockholders and any of their pledgees, donees, transferees, assignees
      and successors-in-interest may, from time to time, sell any or all of their
      shares of Common Stock on any stock exchange, market or trading facility on
      which the shares are traded or in private transactions. These sales may be
      at
      fixed or negotiated prices. The Selling Stockholders may use any one or more
      of
      the following methods when selling shares:

     

    
      	·  	
              ordinary
                brokerage transactions and transactions in which the broker-dealer
                solicits Investors;

            

    

     

    
      	·  	
              block
                trades in which the broker-dealer will attempt to sell the shares
                as agent
                but may position and resell a portion of the block as principal to
                facilitate the transaction;

            

    

     

    
      	·  	
              purchases
                by a broker-dealer as principal and resale by the broker-dealer for
                its
                account;

            

    

     

    
      	·  	
              an
                exchange distribution in accordance with the rules of the applicable
                exchange;

            

    

     

    
      	·  	
              privately
                negotiated transactions;

            

    

     

    
      	·  	
              to
                cover short sales made after the date that this Registration Statement
                is
                declared effective by the Commission;

            

    

     

    
      	·  	
              broker-dealers
                may agree with the Selling Stockholders to sell a specified number
                of such
                shares at a stipulated price per
                share;

            

    

     

    
      	·  	
              a
                combination of any such methods of sale;
                and

            

    

     

    
      	·  	
              any
                other method permitted pursuant to applicable
                law.

            

    

     

    The
      Selling Stockholders may also sell shares under Rule 144 under the Securities
      Act, if available, rather than under this prospectus.

     

    Broker-dealers
      engaged by the Selling Stockholders may arrange for other brokers-dealers to
      participate in sales. Broker-dealers may receive commissions or discounts from
      the Selling Stockholders (or, if any broker-dealer acts as agent for the
      purchaser of shares, from the purchaser) in amounts to be negotiated. The
      Selling Stockholders do not expect these commissions and discounts to exceed
      what is customary in the types of transactions involved.

     

    The
      Selling Stockholders may from time to time pledge or grant a security interest
      in some or all of the Shares owned by them and, if they default in the
      performance of their secured obligations, the pledgees or secured parties may
      offer and sell shares of Common Stock from time to time under this prospectus,
      or under an amendment to this prospectus under Rule 424(b)(3) or other
      applicable provision of the Securities Act of 1933 amending the list of selling
      stockholders to include the pledgee, transferee or other successors in interest
      as selling stockholders under this prospectus.

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

       

    

    Upon
      the
      Company being notified in writing by a Selling Stockholder that any material
      arrangement has been entered into with a broker-dealer for the sale of Common
      Stock through a block trade, special offering, exchange distribution or
      secondary distribution or a purchase by a broker or dealer, a supplement to
      this
      prospectus will be filed, if required, pursuant to Rule 424(b) under the
      Securities Act, disclosing (i) the name of each such Selling Stockholder and
      of
      the participating broker-dealer(s), (ii) the number of shares involved, (iii)
      the price at which such the shares of Common Stock were sold, (iv)the
      commissions paid or discounts or concessions allowed to such broker-dealer(s),
      where applicable, (v) that such broker-dealer(s) did not conduct any
      investigation to verify the information set out or incorporated by reference
      in
      this prospectus, and (vi) other facts material to the transaction. In addition,
      upon the Company being notified in writing by a Selling Stockholder that a
      donee
      or pledgee intends to sell more than 500 shares of Common Stock, a supplement
      to
      this prospectus will be filed if then required in accordance with applicable
      securities law.

     

    The
      Selling Stockholders also may transfer the shares of Common Stock in other
      circumstances, in which case the transferees, pledgees or other successors
      in
      interest will be the selling beneficial owners for purposes of this
      prospectus.

     

    The
      Selling Stockholders and any broker-dealers or agents that are involved in
      selling the shares may be deemed to be "underwriters" within the meaning of
      the
      Securities Act in connection with such sales. In such event, any commissions
      received by such broker-dealers or agents and any profit on the resale of the
      shares purchased by them may be deemed to be underwriting commissions or
      discounts under the Securities Act. Discounts, concessions, commissions and
      similar selling expenses, if any, that can be attributed to the sale of
      Securities will be paid by the Selling Stockholder and/or the purchasers. Each
      Selling Stockholder has represented and warranted to the Company that it
      acquired the securities subject to this registration statement in the ordinary
      course of such Selling Stockholder’s business and, at the time of its purchase
      of such securities such Selling Stockholder had no agreements or understandings,
      directly or indirectly, with any person to distribute any such securities.
      

     

    The
      Company has advised each Selling Stockholder that it may not use shares
      registered on this Registration Statement to cover short sales of Common Stock
      made prior to the date on which this Registration Statement shall have been
      declared effective by the Commission. If a Selling Stockholder uses this
      prospectus for any sale of the Common Stock, it will be subject to the
      prospectus delivery requirements of the Securities Act. The Selling Stockholders
      will be responsible to comply with the applicable provisions of the Securities
      Act and Exchange Act, and the rules and regulations thereunder promulgated,
      including, without limitation, Regulation M, as applicable to such Selling
      Stockholders in connection with resales of their respective shares under this
      Registration Statement.

     

    The
      Company is required to pay all fees and expenses incident to the registration
      of
      the shares, but the Company will not receive any proceeds from the sale of
      the
      Common Stock. The Company has agreed to indemnify the Selling Stockholders
      against certain losses, claims, damages and liabilities, including liabilities
      under the Securities Act. 

     

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

       

    

    Annex
      B

     

    THE
      BLUEBOOK HOLDING COMPANY

     

    Selling
      Securityholder Questionnaire

     

    The
      undersigned beneficial owner of common stock (the “Common
      Stock”)
      of The
      Bluebook International Holding Company (the “Company”)
      understands that the Company has filed or intends to file with the Securities
      and Exchange Commission (the “Commission”)
      a
      Registration Statement for the registration and resale of the Registrable
      Securities, in accordance with the terms of the Registration Rights Agreement,
      dated as of ___, 2004 (the “Registration
      Rights Agreement”),
      among
      the Company and the Investors named therein. A copy of the Registration Rights
      Agreement is available from the Company upon request at the address set forth
      below. All capitalized terms used and not otherwise defined herein shall have
      the meanings ascribed thereto in the Registration Rights Agreement.

     

    The
      undersigned hereby provides the following information to the Company and
      represents and warrants that such information is accurate:

     

    QUESTIONNAIRE

     

    1. Name.

     

    
      	 	
              (a)

            	
              Full
                Legal Name of Selling Securityholder

               

              
                

              

            

    

     

    
      
        	 	
                (b)

              	
                Full
                  Legal Name of Registered Holder (if not the same as (a) above)
                  through
                  which Registrable Securities Listed in Item 3 below are held:

                 

                
                  

                

              

      

    
      	 	
              (c)

            	
              Full
                Legal Name of Natural Control Person (which means a natural person
                who
                directly or indirectly alone or with others has power to vote or
                dispose
                of the securities covered by the questionnaire):

               

              
                

              

            

    

     

    2.
      Address for Notices to Selling Securityholder:

     

    
      	 
	 
	 
	
              Telephone: 

            
	
              Fax: 

            
	
              Contact
                Person: 

            

    

    

    
      
        
        

      

      
        31

        
          

        

      

      
        
        

      

       

    

    3.
      Beneficial Ownership of Registrable Securities:

    
    

    
      
        Type
          and
          Principal Amount of Registrable Securities beneficially
          owned:

      

    

     

    
      	 
	 
	 
	 

    

     

    4.
      Broker-Dealer Status:

     

    
      	 	
              (a)

            	
              Are
                you a broker-dealer?

            

    

     

    Yes
o No
o 

     

    
      	 	
              Note:

            	
              If
                yes, the Commission’s staff has indicated that you should be identified as
                an underwriter in the Registration
                Statement.

            

    

     

    
      	 	
              (b)

            	
              Are
                you an affiliate of a
                broker-dealer?

            

    

     

    Yes o No
o 

     

    
      	 	
              (c)

            	
              If
                you are an affiliate of a broker-dealer, do you certify that you
                bought
                the Registrable Securities in the ordinary course of business, and
                at the
                time of the purchase of the Registrable Securities to be resold,
                you had
                no agreements or understandings, directly or indirectly, with any
                person
                to distribute the Registrable
                Securities?

            

    

     

    Yes
o No
o 

     

    
      	 	
              Note:

            	
              If
                no, the Commission’s staff has indicated that you should be identified as
                an underwriter in the Registration
                Statement.

            

    

     

    5.
      Beneficial Ownership of Other Securities of the Company Owned by the Selling
      Securityholder.

     

    Except
      as set forth below in this Item 5, the undersigned is not the beneficial or
      registered owner of any securities of the Company other than the Registrable
      Securities listed above in Item 3.

     

    
      	 	 	
              Type
                and Amount of Other Securities beneficially owned by the Selling
                Securityholder:

            

    

     

    
      	 
	 
	 

    

    

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

       

    

    6.
      Relationships with the Company:

     

    Except
      as set forth below, neither the undersigned nor any of its affiliates, officers,
      directors or principal equity holders (owners of 5% of more of the equity
      securities of the undersigned) has held any position or office or has had any
      other material relationship with the Company (or its predecessors or affiliates)
      during the past three years.

     

    State
      any
      exceptions here:

     

    
      	 
	 
	 

    

    

     

    The
      undersigned agrees to promptly notify the Company of any inaccuracies or changes
      in the information provided herein that may occur subsequent to the date hereof
      and prior to the Effective Date for the Registration Statement.

     

    By
      signing below, the undersigned consents to the disclosure of the information
      contained herein in its answers to Items 1 through 6 and the inclusion of such
      information in the Registration Statement and the related prospectus. The
      undersigned understands that such information will be relied upon by the Company
      in connection with the preparation or amendment of the Registration Statement
      and the related prospectus.

     

    IN
      WITNESS WHEREOF the undersigned, by authority duly given, has caused this Notice
      and Questionnaire to be executed and delivered either in person or by its duly
      authorized agent.

    
      	 	 	 
	 Dated:
              _________________________________________________________________________________	Beneficial
              Owner:__________________________________________________________________________  
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Name:
	 	Title 

    

      

    PLEASE
      FAX A COPY OF THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE, AND RETURN
      THE ORIGINAL BY OVERNIGHT MAIL, TO:

    

    Rein
      Evans & Sestanovich LLP

    1925
      Century Park East, 16th Floor

    Los
      Angeles, CA 90067

    Facsimile
      No.: (310) 551-0238

    Attn:
      Douglas K. Simpson, Esq.

    

     

    
      
        
        

      

      
        33LOAN AGREEMENT, dated as of August 31, 2005, between SmartServ, Inc., a
Delaware corporation ("Borrower") CAMOFI Master, LDC, a Cayman Islands limited
duration company (together with its successors and assigns "Lender")

         IN CONSIDERATION of the mutual covenants herein contained, Borrower and
Lender agree as follows:

I.       DEFINITIONS

         1.1 General Terms.

  For purposes of this Agreement the following terms shall have the following
meanings:

         "Accounts" shall mean all of Borrowers "accounts" whether now owned or
hereafter acquired (a) for property that has been or is to be sold or otherwise
disposed of or (b) for services rendered or to be rendered.

         "Advances" shall have the meaning set forth in Section 2.1.

         "Affiliate" of any Person shall mean (a) any Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with
such Person, or (b) any Person who is a director or officer (i) of such Person.
For purposes of this definition, control of a Person shall mean the power,
direct or indirect, (x) to vote 20% or more of the securities having ordinary
voting power for the election of directors or, in the case of a Person other
than a corporation, individuals who perform similar functions.

         "Agreement" shall mean this Loan Agreement, as amended, restated,
modified and supplemented from time to time.

         "Borrower's Account" shall have the meaning set forth in Section 2.6.

         "Business Day" shall mean any day other than a day on which commercial
banks in New York are authorized or required by law to close.

         "Closing Date" shall mean the date hereof.

         "Collateral" shall mean the Accounts.

         "Customer" shall mean and include the account debtor with respect to
any Receivable and/or the prospective purchaser of goods, services or both with
respect to any contract or contract right, and/or any party who enters into or
proposes to enter into any contract or other arrangement with Borrower, pursuant
to which Borrower is to deliver any personal property or perform any services.

         "Default" shall mean an event which, with the giving of notice or
passage of time or both, would constitute an Event of Default.

                                       1
<PAGE>

         "Dollar" and the sign "$" shall mean lawful money of the United States
of America.

         "Eligible Accounts" shall mean and include with respect to Borrower,
each Account of Borrower that represents a bona fide obligation arising in the
ordinary course of Borrower's business which, Lender, in its sole credit
judgment, shall deem to be an Eligible Account, based on such considerations as
Lender may from time to time deem appropriate. An Account shall not be deemed
eligible unless such Account is subject to Lender's first priority perfected
security interest and no other lien, and is evidenced by an invoice or other
documentary evidence satisfactory to Lender. No Account shall be an Eligible
Account if any of the conditions identified in clause (a) through (r) exist:

      (a) it arises out of a sale made by Borrower to an Affiliate of Borrower
or to a Person controlled by an Affiliate of Borrower;

      (b) it is due or unpaid more than sixty (60) days after the original
invoice date;

      (c) Twenty percent (20%) or more of the Accounts from the Customer
obligated on such Account (the "Obligor") are not deemed Eligible Accounts
hereunder. Such percentage may, in Lender's sole discretion, be increased or
decreased from time to time;

      (d) any covenant, representation or warranty contained in this Agreement
with respect to such Account has been breached;

      (e) the Obligor shall (i) apply for, suffer, or consent to the appointment
of, or the taking of possession by, a receiver, custodian, trustee or liquidator
of itself or of all or a substantial part of its property or call a meeting of
its creditors, (ii) admit in writing its inability, or be generally unable, to
pay its debts as they become due or cease operations of its present business,
(iii) make a general assignment for the benefit of creditors, (iv) commence a
voluntary case under any state or federal bankruptcy laws (as now or hereafter
in effect), (v) be adjudicated a bankrupt or insolvent, (vi) file a petition
seeking to take advantage of any other law providing for the relief of debtors,
(vii) acquiesce to, or fail to have dismissed, any petition which is filed
against it in any involuntary case under such bankruptcy laws, or (viii) take
any action for the purpose of effecting any of the foregoing;

      (f) the chief executive office or other principal office of the Obligor
with respect to such Account is not located in the United States of America;

      (g) the sale to the Obligor is on consignment or any other repurchase or
return basis or is evidenced by chattel paper;

      (h) Lender believes, in its sole judgment, that collection of such Account
is insecure or that such Account may not be paid by reason of the Obligor's
financial inability to pay;

                                       2
<PAGE>

      (i) the Obligor is the United States of America, any state or any
department, agency or instrumentality of any of them;

      (j) the goods giving rise to such Account have not been shipped to and
accepted by the Obligor or the services giving rise to such Account have not
been performed by the Borrower and accepted by the Obligor or such Account
otherwise does not represent a final sale;

      (k) such Account exceeds a percentage of the unpaid balance of all
Accounts determined by Lender, in its sole discretion, to the extent such
Account exceeds such limit (on the date hereof, such percentage is 25%);

      (l) such Account is subject to any offset, deduction, defense, dispute, or
counterclaim, the Obligor is also a creditor or supplier of Borrower or such
Account is contingent in any respect or for any reason;

      (m) the Borrower has made any agreement with any Obligor for any deduction
therefrom, except for discounts or allowances made in the ordinary course of
business for prompt payment, all of which discounts or allowances are reflected
in the calculation of the face value of each respective invoice related thereto;

      (n) any return, rejection or repossession of the merchandise has occurred;

      (o) such Account is not payable to Borrower;

      (p) such Account is not denominated and payable in Dollars unless credit
insurance satisfactory to Lender has been obtained; or

      (q) such Account is not otherwise satisfactory to Lender as determined in
good faith by Lender in the exercise of its discretion in a reasonable manner.

         "Event of Default" shall mean the occurrence of any of the events set
forth in Article X.

         "Guaranty" shall mean the Guaranty, dated as of the date hereof, of
KPCCD, Inc. in favor of Lender.

         "Governmental Body" shall mean any nation or government, any state or
other political subdivision thereof or any entity exercising the legislative,
judicial, regulatory or administrative functions of or pertaining to a
government.

         "Lender" shall have the meaning ascribed to such term in the preamble
to this Agreement and shall include each Person which becomes a transferee,
successor or assign of Lender.

         "Material Adverse Effect" shall mean a material adverse effect on (a)
the condition, operations, assets, business or prospects of the Borrower or any
of its Subsidiaries, (b) the Borrower's ability to pay the Obligations in
accordance with the terms thereof, (c) the value of the

                                       3
<PAGE>

Collateral, or Lender's liens on the Collateral or the priority of any such lien
or (d) the practical realization of the benefits of Lender's rights and remedies
under this Agreement and the Transaction Documents.

         "Obligations" shall mean and include any and all of the Borrower's
indebtedness and/or liabilities to Lender of every kind, nature and description,
direct or indirect, secured or unsecured, joint, several, joint and several,
absolute or contingent, due or to become due, now existing or hereafter arising,
contractual or tortious, liquidated or unliquidated, regardless of how such
indebtedness or liabilities arise or by what agreement or instrument they may be
evidenced or whether evidenced by any agreement or instrument (including all
interest accruing after the commencement of any bankruptcy or similar proceeding
whether or not enforceable in such proceeding), and all obligations of Borrower
to Lender to perform acts or refrain from taking any action.

         "Payment Office" shall mean initially 350 Third Avenue, New York, New
York, or such other office of Lender, which it may designate by notice to
Borrower to be the Payment Office.

         "Person" shall mean any individual, sole proprietorship, partnership,
corporation, business trust, joint stock company, trust, unincorporated
organization, association, limited liability company, institution, public
benefit corporation, joint venture, entity or government (whether Federal,
state, county, city, municipal or otherwise, including any instrumentality,
division, agency, body or department thereof).

         "Qualified Financing" means an equity financing for the account of
Borrower in which shares of common stock, or securities, directly or indirectly,
convertible into or exchangeable or exercisable for shares of common stock are
issued, which financing results in cumulative aggregate proceeds to the Borrower
of at least $7.5 million.

         "Reserves" shall mean all Obligations then chargeable to any account of
Borrower, as well as Obligations which may, in Lender's sole discretion, be
chargeable to Borrower's account thereafter, by reason of or in connection with
any of the following: Accounts which are not Eligible Accounts; disputed items;
deductions; allowances; credits; bill and hold sales; consignment sales; letters
of credit; steamship guarantees; airway releases; offsets asserted by or granted
to account debtors; sales calling for payment in currencies other than United
States Dollars; to adjust for audit/examination of Borrower's accounts(s) or for
any documentation correction; and such additional reserves as Lender in its sole
discretion, reasonably exercised, deems appropriate, including, but not limited
to adjustments for (a) any condition or prospect of the Borrower or the
Borrower's industry or (b) Dilution. For the purpose of the definition of
Reserves, "Dilution" means any reduction in the balance of an Account or payment
(whether by credit, check, wire transfer or otherwise) issued by Borrower to a
Customer on account of discounts, incorrect billings, credits, rebates,
allowances, charge-backs, returned or repossessed goods, allowances for early
payments or any other reduction in the balance of an Account for any other
reason unrelated to the inability of the Customer to pay the Account.

                                       4
<PAGE>

         "Revolving Credit Note" shall mean, collectively, the promissory note
referred to in Section 2.1(a).

         "Revolving Interest Rate" shall mean an interest rate per annum equal
to the sum of the "Prime Rate" as reported in The Wall Street Journal, such rate
to be adjusted automatically on the effective date of any change in such rate.

         "Securities Purchase Agreement" shall mean the Securities Purchase
Agreement, dated as of the date hereof, between Borrower and Lender.

         "Term" shall have the meaning set forth in Section 11.1.

         "Termination Date" shall have the meaning set forth in Section 11.1.

         "Transaction Documents" shall mean the Revolving Credit Note, the
Guaranty, the Master Security Agreement, dated as of date hereof, between
Borrower and Lender, the Securities Purchase Agreement, dated as of the date
hereof, between Borrower and Lender and any and all other agreements,
instruments and documents, including, without limitation, guaranties, pledges,
powers of attorney, consents, and all other writings heretofore, now or
hereafter executed by the Borrower and/or delivered to Lender in respect of the
transactions contemplated by this Agreement.

         "UCC" shall mean the Uniform Commercial Code as in effect in the State
of New York from time to time.

         "Week" shall mean the time period commencing with the opening of
business on a Monday and ending on the end of business the following Sunday.

         1.2      Certain Matters of Construction.

The terms "herein", "hereof" and "hereunder" and other words of similar import
refer to this Agreement as a whole and not to any particular section, paragraph
or subdivision. Each reference to a Section, an Exhibit or a Schedule shall be
deemed to refer to a Section, an Exhibit or a Schedule, as applicable, of this
Agreement unless otherwise specified. Any pronoun used shall be deemed to cover
all genders. Wherever appropriate in the context, terms used herein in the
singular also include the plural and vice versa. All references to statutes and
related regulations shall include any amendments of same and any successor
statutes and regulations. Unless otherwise provided, all references to any
instruments or agreements to which Lender is a party, shall include any and all
modifications or amendments thereto and any and all extensions or renewals
thereof.

II.      ADVANCES.

         2.1 Advances. Subject to the terms and conditions set forth in this
Agreement (Lender will make advances (the "Advances") to Borrower in an
aggregate amount outstanding

                                       5
<PAGE>

at any time equal to the lesser of (A) an amount equal to (i) $2,500,000 minus
(ii) Reserves, minus (iii) the sum of (x) the outstanding amount of Advances (y)
all amounts due and owing to Borrower's trade creditors which are outstanding
beyond normal trade terms, and (z) fees and expenses for which Borrower is
liable but which have not been paid or charged to Borrower's Account, or (B) an
amount equal to the sum of eighty five percent (85%) of Eligible Accounts (such
aggregate amount outstanding, the "Formula Amount"). The Advances shall be
evidenced by a secured convertible promissory note ("Revolving Credit Note")
delivered by Borrower to Lender at the Closing. As set forth therein, the
Revolving Credit Note provides for (a) at Borrower's option, conversion of the
interest payments due on the Revolving Credit Note into common stock of Borrower
and (b) mandatory prepayment in an amount equal to the product of (a) 1.15, (b)
0.5 and (c) the amount of the Obligations, upon the closing of a Qualified
Financing. Borrower may notify Lender prior to 11:00 a.m. (New York time) on the
Business Day next preceding the Business Day that Borrower desires to incur an
Advance. Any amount required to be paid as interest, fees or other charges under
this Agreement which shall become due, shall be deemed a request for an Advance
as of the date such payment is due, in the amount required to pay in full such
interest, fees or charges and such request shall be irrevocable.

         2.2      Disbursement of Advance Proceeds.

All Advances shall be disbursed from whichever office or other place Lender may
designate from time to time and, together with any and all other Obligations,
shall be charged to Borrower's Account on Lender's books. During the Term,
Borrower may use the Advances by borrowing, prepaying and reborrowing, all in
accordance with the terms and conditions hereof. The proceeds of each Advance
requested by Borrower or deemed to have been requested by Borrower under Section
2.2 shall, with respect to requested Advances to the extent Lender makes such
Advances, be made available to Borrower on the day so requested by way of credit
to Borrower's operating account at Commerce Bank, N.A. or such other bank as
Borrower may designate following notification to Lender, in immediately
available federal funds or other immediately available funds or, with respect to
Advances deemed to have been requested by Borrower, be disbursed to Lender to be
applied to the outstanding Obligations giving rise to such deemed request.

         2.3      Repayment of Advances.

                  (a) The Advances shall be due and payable in full on the
Termination Date subject to earlier prepayment as herein provided.

                  (b) All payments of principal, interest and other amounts
payable hereunder, shall be made to Lender at the Payment Office not later than
11:00 a.m. (New York time) on the due date therefor in lawful money of the
United States of America in federal funds or other funds immediately available
to Lender. Lender shall have the right to effect payment on any and all
Obligations due and owing hereunder by charging Borrower's Account or by making
Advances as provided in Section 2.2.

                                       6
<PAGE>

                  (c) Borrower shall pay principal, interest, and all other
amounts payable hereunder, or under any Transaction Document, without any
deduction whatsoever, including, but not limited to, any deduction for any
setoff or counterclaim.

         2.4      Repayment of Excess Advances.

The aggregate balance of Advances outstanding at any time in excess of the
maximum amount of Advances permitted hereunder shall be immediately due and
payable without the necessity of any demand, at the Payment Office, whether or
not a Default or Event of Default has occurred.

         2.5      Statement of Account.

Lender shall maintain a loan account (the "Borrower's Account") in Borrower's
name in which shall be recorded the date and amount of each Advance made by
Lender and the date and amount of each payment in respect thereof; provided,
however, that the failure by Lender to record such date and amount shall not
adversely affect Lender. Each month, Lender shall send to Borrower a statement
showing the accounting for the Advances made and payments made or credited in
respect thereof. The monthly statements shall be deemed correct and binding upon
Borrower in the absence of manifest error and shall constitute an account stated
between Lender and Borrower unless Lender receives a written statement of
Borrower's specific exception thereto within sixty (60) days after such
statement is received by Borrower.

         2.6      Additional Payments.

Any sums expended by Lender due to Borrower's failure to perform or comply with
its obligations under this or any Transaction Document, may be charged to the
Borrower's Account as an Advance.

         2.7      Mandatory Prepayments.

                  (a) When Borrower sells or otherwise disposes of any
Collateral other than in the ordinary course of business, Borrower shall repay
the Advances in an amount equal to the net proceeds of such sale (i.e., gross
proceeds less the reasonable costs of such sale or other disposition), one (1)
Business Day following receipt of such net proceeds, and until the date of
payment, such proceeds shall be held in trust for Lender. The foregoing shall
not be deemed to be implied consent to any such sale otherwise prohibited by the
terms and conditions hereof. Such repayments shall be applied to the Advances in
such order as Lender may determine, subject to Borrower's ability to reborrow
Advances in accordance with the terms hereof.

                  (b) The Lender shall apply the proceeds of any insurance
settlements from casualty losses which are received by the Lender to the
outstanding Advances in such order as Lender may determine, subject to
Borrower's ability to reborrow Advances in accordance with the terms hereof.

                                       7
<PAGE>

         2.8 Use of Proceeds. Borrower shall apply the proceeds of Advances made
on and after the Closing Date to pay fees and expenses relating to the
transactions contemplated by this Agreement and to provide for its working
capital needs.

III.     INTEREST, FEES AND OTHER MATTERS.

         3.1 Interest. Interest on Advances shall be payable in arrears on the
first Business Day of each month. Interest charges shall be computed on the
actual principal amount of Advances outstanding on the last Business Day of the
preceding month at a rate per annum equal to the Revolving Interest Rate. Upon
and after the occurrence of an Event of Default, the Obligations shall bear
interest at the Revolving Interest Rate, plus fifteen percent (15%) per annum
the ("Default Rate"); provided, however, that the Defaults shall not exceed
twenty percent (20%).

         3.2 Fee for Overadvance. If the principal amount outstanding of the
Revolving Credit Note exceeds the Formula Amount, such excess shall bear
interest at the rate of 1% per month (prorated for any partial month).

         3.3 Computation of Interest and Fees. Interest and fees hereunder shall
be computed on the basis of a year of 360 days and for the actual number of days
elapsed. If any payment to be made hereunder becomes due and payable on a day
other than a Business Day, the due date thereof shall be extended to the next
succeeding Business Day and interest thereon shall be payable at the Revolving
Interest Rate.

         3.4 Commitment Fee. Borrower shall pay to Lender commitment fees of (a)
$25,000 on each anniversary of the Closing Date and prorated if the Termination
Date is not on such anniversary, and (b) on the first Business Day of each
month, the product of (i) 0.50% per annum and (ii) the difference between
$2,500,000 and the principal amount of the Revolving Credit Note on the last
Business Day of the preceding month.

         3.5 Maximum Charges. In no event whatsoever shall interest and other
charges hereunder exceed the highest rate permissible under law. If interest and
other charges as computed hereunder would otherwise exceed such rate, such
excess amount shall be first applied to any unpaid principal balance owed by
Borrower, and if the then remaining excess amount is greater than the previously
unpaid principal balance, Lender shall promptly refund such excess amount to
Borrower and the provisions hereof shall be deemed amended to provide for such
permissible rate.

         3.6 Establishment of a Controlled Account. All proceeds of Collateral
shall be deposited by Borrower into an account (the "Controlled Account") as
Lender may require pursuant to an arrangement with such bank as may be selected
by Borrower and be acceptable to Lender. All funds deposited in the Controlled
Account shall immediately become the property of Lender and Borrower shall
obtain the agreement by such bank to waive any offset rights against the funds
so deposited. Lender does not assume any responsibility for any Controlled

                                       8
<PAGE>

Account arrangement, including without limitation, any claim of accord and
satisfaction or release with respect to deposits accepted by any bank
thereunder.

         3.7 Adjustments. Borrower will not, without Lender's consent,
compromise or adjust any Accounts (or extend the time for payment thereof) or
accept any returns of merchandise or grant any additional discounts, allowances
or credits thereon.

         3.8 Exculpation of Liability. Nothing herein contained shall be
construed to constitute Lender as Borrower's agent for any purpose whatsoever,
nor shall Lender be responsible or liable for any shortage, discrepancy, damage,
loss or destruction of any part of the Collateral wherever the same may be
located and regardless of the cause thereof, except if any such shortage,
discrepancy, damage, loss or destruction is actually caused by Lender's gross
negligence or willful misconduct, as determined by a final order of a court of
competent jurisdiction. Lender shall not assume any of Borrower's obligations
under any agreement assigned to Lender, and Lender shall not be responsible in
any way for the performance by Borrower of any of the terms and conditions
thereof.

IV. REPRESENTATIONS AND WARRANTIES. The representations and warranties of
Borrower set forth in Section 3 of the Securities Purchase Agreement are
incorporated herein by reference, mutatis mutandis. In addition, Borrower
represents and warrants to Lender that Nimesh Patel is an employee of Borrower
and has provided Lender with a true and complete copy of his Employment
Agreement.

V. COVENANTS. The covenants of Borrower set forth in Section 5 of the Securities
Purchase Agreement are incorporated herein by reference mutatis mutandis.

VI. CONDITIONS TO EACH ADVANCE.

The agreement of Lender to make any Advance is subject to the satisfaction of
the following conditions precedent as of the date such Advance is made:

      (a) Representations and Warranties.

Each of the representations and warranties made by Borrower in or pursuant to
this Agreement and the Transaction Documents, and each of the representations
and warranties contained in any certificate, document or financial or other
statement furnished at any time under or in connection with this Agreement or
the Transaction Documents shall be true and correct in all material respects on
and as of such date as if made on and as of such date;

      (b) No Default.

No Event of Default or Default shall have occurred and be continuing on such
date, or would exist after giving effect to the Advances requested to be made on
such date; provided, however, that Lender, in its sole discretion, may continue
to make Advances notwithstanding the existence

                                       9
<PAGE>

of an Event of Default or Default and that any Advances so made shall not be
deemed a waiver of any such Event of Default or Default; and

      (c) Maximum Advances.

The aggregate Advances outstanding shall not exceed the maximum amount of
Advances permitted under Section 2.1.

          Each request for an Advance by Borrower hereunder shall constitute a
representation and warranty by Borrower as of the date of such Advance that the
conditions contained in this Section shall have been satisfied.

VII.     INFORMATION AS TO BORROWER.

         Borrower shall, until satisfaction in full of the Obligations and the
termination of this Agreement:

7.1      Schedules.

7.2      The Borrower shall:

      (a) Deliver to Lender on Wednesday of each Week a Borrowing Base
Certificate in a form provided by Lender (which shall be calculated as of the
last day of the immediately preceding Week and which shall not be binding upon
Lender or restrictive of Lender's rights under this Agreement).

      (b) Deliver to Lender on Wednesday of each Week as and for the prior Week
(i) accounts receivable agings and (ii) accounts payable agings. In addition,
Borrower shall deliver to Lender at such intervals as Lender may require such
further schedules, documents and/or information regarding the Collateral as
Lender may require including, without limitation, trial balances and test
verifications. Lender shall have the right to audit, confirm and verify all
Accounts by any manner and through any medium it considers advisable and do
whatever it may deem reasonably necessary to protect its interests hereunder.

      (c) The items to be provided under Sections 7.1(a) and 7.1(b) are to be in
form satisfactory to Lender and executed by Borrower and delivered to Lender
from time to time solely for Lender's convenience in maintaining records of the
Collateral, and Borrower's failure to deliver any of such items to Lender shall
not affect, terminate, modify or otherwise limit Lender's lien with respect to
the Collateral.

7.3      Litigation.

Promptly notify Lender in writing of any litigation, suit or administrative
proceeding affecting Borrower, whether or not the claim is covered by insurance.

7.4      Material Occurrences.

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<PAGE>

Promptly notify Lender in writing upon the occurrence of (a) any Event of
Default or Default; (b) any event, development or circumstance whereby any
financial statements or other reports furnished to Lender fail in any material
respect to present fairly, in accordance with GAAP consistently applied, the
financial condition or operating results of Borrower as of the date of such
statements; (c) each and every default by Borrower which might result in the
acceleration of the maturity of any indebtedness, including the names and
addresses of the holders of such indebtedness with respect to which there is a
default existing or with respect to which the maturity has been or could be
accelerated, and the amount of such indebtedness; and (d) any other development
in the business or affairs of Borrower which could reasonably be expected to
have a Material Adverse Effect; in each case describing the nature thereof and
the action Borrower proposes to take with respect thereto.

7.5      Other Reports.

Furnish Lender as soon as available, but in any event within ten (10) days after
the issuance thereof, with copies of such financial statements, reports and
returns as Borrower shall send to its stockholders.

7.6      Additional Information.

Furnish Lender with such additional information as Lender shall reasonably
request in order to enable Lender to determine whether the covenants and
conditions of this Agreement and the Revolving Credit Note have been complied
with by Borrower, including, without limitation and without the necessity of any
request by Lender, (a) at least thirty (30) days prior thereto, notice of
Borrower opening of any new office or place of business or Borrower closing of
any existing office or place of business, and (b) promptly upon Borrower
learning thereof, notice of any labor dispute to which Borrower may become a
party, any strikes or walkouts relating to any of its facilities, and the
expiration of any labor contract to which Borrower is a party or by which
Borrower is bound.

7.7      Notice of Suits, Adverse Events.

Furnish Lender with prompt notice of (a) any lapse or other termination of any
Consent issued to Borrower by any Governmental Body or any other Person that is
material to the operation of Borrower's business, (b) any refusal by any
Governmental Body or any other Person to renew or extend any such Consent; and
(c) copies of any periodic or special reports filed by Borrower with any
Governmental Body or Person, if such reports indicate any material change in the
business, operations, affairs or condition of Borrower, or if copies thereof are
requested by Lender or any Lender, and (d) copies of any material notices and
other communications from any Governmental Body or Person which specifically
relate to Borrower.

7.8      Additional Documents.

                                       11
<PAGE>

Execute and deliver to Lender, upon request, such documents and agreements as
Lender may, from time to time, reasonably request to carry out the purposes,
terms or conditions of this Agreement.

VIII. EVENTS OF DEFAULT.

      The occurrence of any one or more of the following events shall constitute
an "Event of Default":

      8.1 failure by Borrower to pay any principal or interest on the
Obligations when due, whether at maturity or by reason of acceleration pursuant
to the terms of this Agreement or by notice of intention to prepay, or by
required prepayment or failure to pay any other liabilities or make any other
payment, fee or charge provided for herein when due or in any Transaction
Document;

      8.2 issuance of a notice of lien, levy assessment, injunction attachment
or service against any portion of Borrower's property which is not stayed or
lifted within fifteen (15) day or bonded pending appeal;

      8.3 failure or neglect of Borrower to perform, keep or observe any term,
provision, condition, covenant herein contained herein or in any Transaction
Document (to the extent such breach is not otherwise embodied in any other
provision of this Article VIII for which a different grace or cure period is
specified or which constitute an immediate Event of Default, which is not cured
within fifteen (15) Business Days after the occurrence of such Event of Default;

      8.4 any judgment or judgments are rendered or judgment liens filed against
Borrower or any of its subsidiaries for an aggregate amount in excess of $25,000
which within thirty (30) days of such rendering or filing is not either
satisfied, stayed or discharged of record;

      8.5 Borrower or any Affiliate of Borrower shall (a) apply for, consent to
or suffer the appointment of, or the taking of possession by, a receiver,
custodian, trustee, liquidator or similar fiduciary of itself or of all or a
substantial part of its property, (b) make a general assignment for the benefit
of creditors, (c) commence a voluntary case under any state or federal
bankruptcy laws (as now or hereafter in effect), (d) be adjudicated a bankrupt
or insolvent, (e) file a petition seeking to take advantage of any other law
providing for the relief of debtors, (f) acquiesce to, or fail to have
dismissed, within thirty (30) days, any petition filed against it in any
involuntary case under such bankruptcy laws, or (g) take any action for the
purpose of effecting any of the foregoing;

      8.6 Borrower shall admit in writing its inability, or be generally unable,
to pay its debts as they become due or cease operations of its present business;

      8.7 any change in the condition or affairs of Borrower or any of its
subsidiaries (financial or otherwise) which could reasonably have a Material
Adverse Effect;

                                       12
<PAGE>

      8.8 any lien or any Collateral having value, as determined by Lender in
its good faith judgment of $10,000 or more created hereunder or provided for
hereby for any reason ceases to be or is not a valid and perfected lien having a
first priority interest;

      8.9 termination or breach of the Guaranty or if the guarantor thereunder
attempts to terminate or challenge its liability under the Guaranty;

      8.10 any material provision of this Agreement shall, for any reason, cease
to be valid and binding on Borrower, or Borrower shall so claim in writing to
Lender;

      8.11 (a) any Governmental Body shall (i) revoke, terminate, suspend or
adversely modify any license, permit, patent, trademark or tradename of
Borrower, or (ii) commence proceedings to suspend, revoke, terminate or
adversely modify any such license, permit, trademark or tradename and such
proceedings shall not be dismissed or discharged within sixty (60) days, or
(iii) schedule or conduct a hearing on the renewal of any license, permit,
patent, trademark or tradename necessary for the continuation of Borrower's
business and the staff of such Governmental Body issues a report recommending
the termination, revocation, suspension or material, adverse modification of
such license, permit, patent, trademark or tradename; or (b) any agreement which
is necessary or material to the operation of Borrower's business shall be
revoked or terminated and not replaced by a substitute acceptable to Lender
within thirty (30) days after the date of such revocation or termination, and
such revocation or termination and non-replacement would reasonably be expected
to have a Material Adverse Effect;

      8.12 any portion of the Collateral shall be seized or taken by a
Governmental Body, or Borrower or the title and rights of Borrower shall have
become the subject matter of litigation which might, in the opinion of Lender,
upon final determination, could cause a Material Adverse Effect;

      8.13 if the Service Agreement, dated August 8, 2003, between CDC System,
Inc. and Borrower is terminated for any reason whatsoever;

      8.14 upon the occurrence of a breach or an event of breach under the
Private Label PCS Services Agreement dated as of November 5, 2004 (the "PCS
Agreement") by and between Sprint Spectrum L.P. ("Sprint") and the Borrower;

      8.15 if the Master Vendor Agreement made December 7, 2005 by and among
KPCCD, Inc., Nimesh Patel, et al. is not terminated by December 31, 2005;

      8.16 the occurrence of an "Event of Default" under the Securities Purchase
Agreement;

      8.17 if the aggregate amount of the outstanding Obligations exceeds the
Formula Amount for any thirty day period;

      8.18 if the Irrevocable Standby Letter of Credit provided for in the PCS
Agreement is not issued to and accepted by Sprint by September 21, 2005; and

                                       13
<PAGE>

      8.19 if Sprint draws down under such Letter of Credit.

IX.   LENDER'S RIGHTS AND REMEDIES AFTER DEFAULT.

      9.1 Rights and Remedies.

Upon the occurrence of (a) an Event of Default pursuant to Section 8.6 all
Obligations shall be immediately due and payable and this Agreement and the
obligation of Lender to make Advances shall be deemed terminated; and (b) any of
the other Events of Default and at any time thereafter at the option of Lender
all Obligations shall be immediately due and payable and Lender shall have the
right to terminate this Agreement and to terminate the obligation of Lender to
make Advances. Upon the occurrence of any Event of Default, Lender shall have
the right to exercise any and all other rights and remedies provided for herein,
under the Master Security Agreement, dated as of the date hereof, between
Borrower and Lender, the UCC and at law or equity generally.

      9.2 Application of Proceeds.

The proceeds realized from the sale of any Collateral shall be applied as
follows: first, to the reasonable costs, expenses and attorneys' fees and
expenses incurred by Lender for collection and for acquisition, completion,
protection, removal, storage, sale and delivery of the Collateral; second, to
interest due upon any of the Advances; third, to fees payable in connection with
this Agreement; fifth, to the principal of the Advances and all other fees,
costs, expenses and indemnities due under this Agreement and, sixth, to all
other Obligations. If any deficiency shall arise, Borrower shall remain liable
to Lender therefor. If it is determined by an authority of competent
jurisdiction that a disposition by Lender did not occur in a commercially
reasonably manner, Lender may obtain a deficiency judgment for the difference
between the amount of the Obligation and the amount that a commercially
reasonable sale would have yielded. Lender will not be considered to have
offered to retain the Collateral in satisfaction of the Obligations unless
Lender has entered into a written agreement with Borrower to that effect.

      9.3 Lender's Discretion.

Except as otherwise provided herein, Lender shall have the right in its sole
discretion to determine which rights, liens, security interests or remedies
Lender may at any time pursue, relinquish, subordinate, or modify or to take any
other action with respect thereto and such determination will not in any way
modify or affect any of Lender's or Lender's rights hereunder.

      9.4 Setoff.

In addition to any other rights which Lender may have under applicable law, upon
the occurrence of an Event of Default, Lender shall have a right to apply the
Borrower property held by such Lender to reduce the Obligations.

      9.5 Rights and Remedies not Exclusive.

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<PAGE>

The enumeration of the foregoing rights and remedies is not intended to be
exhaustive and the exercise of any right or remedy shall not preclude the
exercise of any other right or remedy provided for herein or otherwise provided
by law, all of which shall be cumulative and not alternative.

X.    WAIVERS AND JUDICIAL PROCEEDINGS.

      10.1 Waiver of Notice.

Borrower hereby waives notice of non-payment of any of the Accounts, demand,
presentment, protest and notice thereof with respect to any and all instruments,
notice of acceptance hereof, notice of loans or advances made, credit extended,
Collateral received or delivered, or any other action taken in reliance hereon,
and all other demands and notices of any description, except such as are
expressly provided for herein.

      10.2 Delay. No delay or omission on Lender's part in exercising any right,
remedy or option shall operate as a waiver of such or any other right, remedy or
option or of any default.

      10.3 Jury Waiver. EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY
RIGHT TO TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION (A) ARISING UNDER THIS
AGREEMENT OR ANY TRANSACTION, DOCUMENT OR (B) IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO THIS AGREEMENT OR ANY TRANSACTION DOCUMENT OR THE TRANSACTIONS
RELATED HERETO OR THERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE AND EACH PARTY TO
THIS AGREEMENT HEREBY CONSENTS THAT ANY SUCH CLAIM, OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENTS OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO
TRIAL BY JURY.

XI.   EFFECTIVE DATE AND TERMINATION.

      11.1 Term. This Agreement, which shall inure to the benefit of and shall
be binding upon the respective successors and permitted assigns of Borrower and
Lender, shall become effective on the date hereof and shall continue in full
force and effect until the earliest of (a) February 28, 2008

      11.2 , (b) the acceleration of all Obligations pursuant to the terms of
this Agreement or (c) the date on which this Agreement shall be terminated in
accordance with the provisions hereof (the "Termination Date"; such period
referred to herein as the "Term").

      11.3 Termination. The termination of this Agreement shall not affect the
Lender's rights, or any of the Obligations having their inception prior to the
effective date of such

                                       15
<PAGE>

termination, and the provisions hereof shall continue to be fully operative
until all transactions entered into, rights or interests created or Obligations
have been fully disposed of, concluded or liquidated. The rights granted to
Lender hereunder shall continue in full force and effect, notwithstanding the
termination of this Agreement or the fact that Borrower's Account may from time
to time be temporarily in a zero or credit position, until all of the
Obligations of Borrower have been paid or performed in full after the
termination of this Agreement. Accordingly, Borrower waives any rights which it
may have under Section 9-513 of the UCC to demand the filing of termination
statements with respect to the Collateral, and Lender shall not be required to
send such termination statements to Borrower, or to file them with any filing
office, unless and until this Agreement shall have been terminated in accordance
with its terms and all Obligations paid in full in immediately available funds.
All representations, warranties, waivers and agreements contained herein shall
survive termination hereof until all Obligations are paid or performed in full.

XII.  WAIVER OF SUBROGATION.

      12.1 Waiver of Subrogation. Borrower expressly waives any and all rights
of subrogation, reimbursement, indemnity, exoneration, contribution of any other
claim which Borrower may now or hereafter have against any Person directly or
contingently liable for the Obligations hereunder, or against or with respect to
Borrower's property (including, without limitation, any property which is
Collateral for the Obligations), arising from the existence or performance of
this Agreement, until termination of this Agreement and repayment in full of the
Obligations.

XIII. MISCELLANEOUS.

      13.1 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applied to contracts to be
performed wholly within the State of New York. Any judicial proceeding brought
by or against Borrower with respect to any of the Obligations, this Agreement or
any Transaction Document may be brought in any court of competent jurisdiction
in the State of New York, United States of America, and, by execution and
delivery of this Agreement, Borrower accepts for itself and in connection with
its properties, generally and unconditionally, the non-exclusive jurisdiction of
such court, and irrevocably agrees to be bound by any judgment rendered thereby
in connection with this Agreement. Borrower hereby waives personal service of
any and all process upon it and consents that all such service of process may be
made by registered mail (return receipt requested) directed to Borrower at its
address set forth in Section 13.4 and service so made shall be deemed completed
five (5) days after the same shall have been so deposited in the mails of the
United States of America, or, at the Lender's option, by service upon Borrower.
Nothing herein shall affect the right to serve process in any manner permitted
by law or shall limit the right of Lender to bring proceedings against Borrower
in the courts of any other jurisdiction. Borrower waives any objection to
jurisdiction and venue of any action instituted hereunder and shall not assert
any defense based on lack of jurisdiction or venue or based upon forum non
conveniens. Any judicial proceeding by Borrower against Lender involving,
directly or indirectly, any matter

                                       16
<PAGE>

or claim in any way arising out of, related to or connected with this Agreement
or any Transaction Document, shall be brought only in a federal or state court
located in the City of New York, State of New York.

      13.2 Entire Understanding. This Agreement and the Transaction Documents
contain the entire understanding between Borrower and Lender and supersedes all
prior agreements and understandings, if any, relating to the subject matter
hereof. Any promises, representations, warranties or guarantees not herein
contained and hereinafter made shall have no force and effect unless in writing,
signed by Borrower. Neither this Agreement nor any portion or provisions hereof
may be changed, modified, amended, waived, supplemented, discharged, cancelled
or terminated orally or by any course of dealing, or in any manner other than by
an agreement in writing, signed by the party to be charged. Borrower
acknowledges that it has been advised by counsel in connection with the
execution of this Agreement and the Transaction Documents and is not relying
upon oral representations or statements inconsistent with the terms and
provisions of this Agreement.

      13.3 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of Borrower and Lender, all future holders of the
Obligations and their respective successors and assigns, except that Borrower
may not assign or transfer any of its rights or obligations under this Agreement
without the prior written consent of Lender.

      13.4 Notice. Any notice or request hereunder may be given to Borrower or
to any Lender at their respective addresses set forth below or at such other
address as may hereafter be specified in a notice designated as a notice of
change of address under this Section. Any notice or request hereunder shall be
given by (a) hand delivery, (b) overnight courier, (c) registered or certified
mail, return receipt requested, or (d) telecopy to the number set out below (or
such other number as may hereafter be specified in a notice designated as a
notice of change of address) with electronic confirmation of its receipt. Any
notice or other communication required or permitted pursuant to this Agreement
shall be deemed given (a) when personally delivered to any officer of the party
to whom it is addressed, (b) on the earlier of actual receipt thereof or three
(3) days following posting thereof by certified or registered mail, postage
prepaid, or (c) upon actual receipt thereof when sent by a recognized overnight
delivery service or (d) upon actual receipt thereof when sent by telecopier to
the number set forth below with electronic confirmation of its receipt, in each
case addressed to each party at its address set forth below or at such other
address as has been furnished in writing by a party to the other by like notice:

      (A)   If to Lender:          c/o Centrecourt Asset Management 350 Third
                                   Avenue, 8th Floor New York, New York 10017
                                   Attention: Keith Wellner, Esq.
                                   Facsimile: (646) 304-0600

      (B)   If to Borrower at :    SmartServ Online, Inc. 2250 Butler Pike Suite
                                   150 Plymouth Meetings, PA Attention: Robert
                                   Pons Facsimile: (610) 397-0846

                                       17
<PAGE>

      13.5 Severability. If any part of this Agreement is contrary to,
prohibited by, or deemed invalid under applicable laws or regulations, such
provision shall be inapplicable and deemed omitted to the extent so contrary,
prohibited or invalid, but the remainder hereof shall not be invalidated thereby
and shall be given effect so far as possible.

      13.6 Expenses. All costs and expenses including, without limitation, (i)
reasonable attorneys' fees and disbursements incurred by Lender (a) in all
efforts made to enforce payment of any Obligation or effect collection of any
Collateral, or (b) in connection with the entering into, modification,
amendment, administration and enforcement of this Agreement or any consents or
waivers hereunder and the Transaction Documents, or (c) in instituting,
maintaining, preserving, enforcing and foreclosing on Lender's security interest
in any of the Collateral, whether through judicial proceedings or otherwise, or
(d) in defending or prosecuting any actions or proceedings arising out of or
relating to Lender's transactions with Borrower, and (ii) reasonable fees and
disbursements incurred by Lender or Lender on behalf of Lender in connection
with any appraisals of Collateral, field examinations, collateral analysis or
monitoring or other business analysis conducted by outside Persons in connection
with this Agreement and the Transaction Documents, may be charged to Borrower's
Account and shall be part of the Obligations.

      13.7 Injunctive Relief. Borrower recognizes that, if Borrower fails to
perform, observe or discharge any of its obligations or liabilities under this
Agreement, any remedy at law may prove to be inadequate relief to Lender;
therefore, Lender, if Lender so requests, shall be entitled to temporary and
permanent injunctive relief in any such case without the necessity of proving
that actual damages are not an adequate remedy.

      13.8 Consequential Damages. Lender shall not be liable to Borrower for
consequential damages arising from any breach of contract, tort or other wrong
relating to the establishment, administration or collection of the Obligations.

      13.9 Captions. The captions at various places in this Agreement are
intended for convenience only and do not constitute and shall not be interpreted
as part of this Agreement.

      13.10 Counterparts; Telecopied Signatures. This Agreement may be executed
in any number of and by different parties hereto on separate counterparts, all
of which, when so executed, shall be deemed an original, but all such
counterparts shall constitute one and the same agreement. Any signature
delivered by a party by facsimile transmission shall be deemed to be an original
signature hereto.

      13.11 Construction. The parties acknowledge that each party and its
counsel have reviewed this Agreement and that the normal rule of construction to
the effect that any

                                       19
<PAGE>

ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement or any amendments, schedules or exhibits
thereto.

      13.12 Confidentiality; Sharing Information. (a) Lender shall hold all
non-public information obtained by Lender pursuant to the requirements of this
Agreement in accordance with Lender's customary procedures for handling
confidential information of this nature; provided, however, Lender may disclose
such confidential information (a) to its examiners, affiliates, outside
auditors, counsel and other professional advisors, (b) to any purchaser of the
Revolving Credit Note and Lender's rights under this Agreement, and (c) as
required or requested by any Governmental Body or representative thereof or
pursuant to legal process; and (ii) in no event shall Lender be obligated to
return any materials furnished by Borrower other than those documents and
instruments in possession of Lender in order to perfect its lien on the
Collateral once the Obligations have been paid in full and this Agreement has
been terminated.

      13.13 Publicity. Borrower hereby authorizes Lender to make appropriate
announcements of the financial arrangement entered into between Borrower and
Lender, including, without limitation, announcements which are commonly known as
tombstones, in such publications and to such selected parties as Lender shall in
its sole and absolute discretion deem appropriate.

      Each of the parties has signed this Agreement as of the day and year first
above written.

ATTEST:                           SMARTSERV, INC.
                                  as Borrower

                                  By:      /s/ Robert M. Pons
Timothy. G. Wenhold                        -----------------------------------
_______________________           Name:    Robert M. Pons
                                  Title:    Chief Executive Officer

                                  CAMOFI MASTER LDC
                                  as Lender

                                  By:      /s/ Richard Smithline
                                           -----------------------------------
_______________________           Name:
                                  Title:

                                       19
<PAGE>

STATE OF NEW YORK    )
                     ) ss.
COUNTY OF NEW YORK   )

         On this ____ day of August, 2005, before me personally came
______________________________, to me known, who, being by me duly sworn, did
depose and say that he is the President of SmartServ, Inc., the corporation
described in and which executed the foregoing instrument; and that he signed his
name thereto by order of the Board of Directors of such corporation.

                                                  ------------------------------
                                                           NOTARY PUBLIC

                                       20
<PAGE>

STATE OF NEW YORK   )
                    ) ss.
COUNTY OF NEW YORK  )

         On this _____ day of August, 2005 before me personally came
______________________________, to me known, who, being by me duly sworn, did
depose and say that he is the __________________ of CAMOFI Master, LDC, a Cayman
Islands limited duration company and that he signed his name thereto by on
behalf of such limited duration company.

                                                     ---------------------------
                                                            NOTARY PUBLIC

                                       21

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