Document:

EXHIBIT 10.17

                                     FORM OF

                           INTEGRAL TECHNOLOGIES, INC.

                             STOCK PURCHASE WARRANT

         THE WARRANTS EVIDENCED HEREBY AND THE SHARES OF STOCK ISSUABLE
            UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER THE
               SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
          OFFERED OR SOLD WITHOUT REGISTRATION UNLESS AN EXEMPTION FROM
            REGISTRATION IS AVAILABLE UNDER SUCH ACT OR THE RULES OR
                       REGULATIONS PROMULGATED THEREUNDER

Expiration Date: December 31, 2009                    No. ___

                               WARRANT TO PURCHASE
                             SHARES OF COMMON STOCK
                               AS DESCRIBED HEREIN

     This certifies that, for value received,__________________________________,
or its successors and assigns ("Holder"), is entitled to receive from Integral
                                ------
Technologies, Inc., a Nevada corporation (the "Company"), up to and including
                                               -------
____________ fully paid and non-assessable shares (the "Number of Shares") of
                                                        ----------------
the common stock, par value $0.001 per share, of the Company (the "Common
                                                                   ------
Stock") on the terms set forth herein, at no additional consideration by the
-----
Holder.

     1.     Exercise.
            --------

          1.1     Time for Exercise.  This Warrant may be exercised in whole or
                  -----------------
in part at any time, and from time to time, during the period commencing on
April 30, 2004 and expiring on December 31, 2009.

          1.2     Manner of Exercise.  This Warrant shall be deemed exercised
                  ------------------
upon receipt by the Company by means of facsimile, the Notice of Exercise
attached hereto duly completed and signed by the Holder (or its agent),
specifying the number of shares as to which the Warrant is being exercised at
that time.

          1.3     Effect of Exercise.  Promptly (but in any case within five
                  ------------------
business days) after any exercise, the Company shall deliver to the Holder (i)
duly executed certificates in the name or names specified in the exercise notice
representing the aggregate number of shares issuable upon such exercise, and
(ii) if this Warrant is exercised only in part, a new Warrant of like tenor
representing the balance of the Number of Shares.  Such certificates shall be
deemed to have been issued, and the person receiving them shall be deemed to be
a holder of record of such shares, as of the close of business on the date the
actions required in Section 1.2 shall have been completed or, if on that date
the stock transfer books of the Company are closed, as of the next business day
on which the stock transfer books of the Company are open.

<PAGE>
                                     FORM OF

     2.     Transfer of Warrants and Stock.
            ------------------------------

          2.1     Transfer Restrictions.  Except as provided in the Securities
                  ---------------------
Purchase Agreement dated the date hereof, the sale or re-sale of the Warrant and
the Common Stock issuable upon exercise of the Warrant has not been and is not
being registered under the Securities Act of 1933, as amended ("Securities
                                                                ----------
Act"), or any applicable state securities laws.  Neither this Warrant nor the
---
securities issuable upon its exercise may be sold, transferred or pledged unless
the Company shall have been supplied with reasonably satisfactory evidence that
such transfer is not in violation of the Securities Act and any applicable state
securities laws.  The Company may place a legend to that effect on this Warrant,
any replacement Warrant and each certificate representing shares issuable upon
exercise of this Warrant.

          2.2     Manner of Transfer.  Upon delivery of this Warrant to the
                  ------------------
Company with the attached assignment form duly completed and signed, the Company
will promptly (but in any case within five business days) execute and deliver to
each transferee and, if applicable, the Holder, Warrants of like tenor
evidencing the rights (i) of the transferee(s) to purchase the Number of Shares
specified for each in the assignment forms, and (ii) of the Holder to purchase
any untransferred portion, which in the aggregate shall equal the Number of
Shares of the original Warrant.  If this Warrant is properly assigned in
compliance with this Section 2, it may be exercised by an assignee without
having a new Warrant issued.

          2.3     Loss, Destruction of Warrant Certificates.  Upon receipt of
                  -----------------------------------------
(i) evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of any Warrant and (ii) except in the case of
mutilation, an indemnity or security reasonably satisfactory to the Company (the
original Holder's or any other institutional Holder's indemnity agreed to be
satisfactory), the Company will promptly (but in any case within five business
days) execute and deliver a replacement Warrant of like tenor representing the
right to purchase the same Number of Shares.

          2.4     Cost of Issuances.  The Company shall pay all expenses,
                  -----------------
transfer taxes and other charges payable in connection with the preparation,
issuance and delivery of stock certificates or replacement Warrants, except for
any transfer tax or other charge imposed as a result of (i) any issuance of
stock certificates in any name other than the name of the Holder upon exercise
of the Warrant or (ii) any transfer of the Warrant.  The Company shall not be
required to issue or deliver any stock certificate or Warrant until it receives
reasonably satisfactory evidence that any such tax or other charge has been paid
by the Holder.

     3.     Covenants.  The Company agrees that:
            ---------

          3.1     Reservation of Stock.  During the period in which this Warrant
                  --------------------
may be exercised, the Company will reserve sufficient authorized but unissued
securities (and, if applicable, property) to enable it to satisfy its
obligations on exercise of this Warrant.  If at any time the Company's
authorized securities shall not be sufficient to allow the exercise of this
Warrant, the Company shall take such corporate action as may be necessary to
increase its authorized but unissued securities to be sufficient for such
purpose;

          3.2     No Liens, etc.  All securities that may be issued upon
                  -------------
exercise of this Warrant will, upon issuance, be validly issued, fully paid,
non-assessable and free from all taxes, liens and charges with respect to the
issue thereof, and shall be listed on any exchanges or authorized for trading on
any automated systems on which that class of securities is listed or authorized
for trading;

                                        2
<PAGE>
                                     FORM OF

          3.3     No Diminution of Value.  The Company will not take any action
                  ----------------------
to terminate this Warrant or to diminish it in value;

          3.4     Furnish Information.  The Company will promptly deliver to the
                  -------------------
Holder copies of all financial statements, reports, proxy statements and other
information which the Company shall have sent to its shareholders generally; and

          3.5     Stock and Warrant Transfer Books.  Except upon dissolution,
                  --------------------------------
liquidation or winding up or for ordinary holidays and weekends, the Company
will not at any time close its stock or warrant transfer books so as to result
in preventing or delaying the exercise or transfer of this Warrant.

     4.     General Provisions.
            ------------------

          4.1     Complete Agreement; Modifications.  This Warrant and any
                  ---------------------------------
documents referred to herein or executed contemporaneously herewith constitute
the parties' entire agreement with respect to the subject matter hereof and
supersede all agreements, representations, warranties, statements, promises and
understandings, whether oral or written, with respect to the subject matter
hereof.  This Warrant may not be amended, altered or modified except by a
writing signed by the parties.

          4.2     Additional Documents.  Each party hereto agrees to execute any
                  --------------------
and all further documents and writings and to perform such other actions which
may be or become necessary or expedient to effectuate and carry out this
Warrant.

          4.3     Notices.  Any notices required or permitted to be given under
                  -------
the terms of this Agreement shall be sent by certified or registered mail
(return receipt requested) or delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile and shall be effective
five days after being placed in the mail, if mailed by regular United States
mail, or upon receipt, if delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile, in each case addressed
to a party.  The addresses for such communications shall be:

          If to the Company:

               Integral Technologies Inc.
               805 W. Orchard Drive, Suite 3
               Bellingham, WA  98225
               Attention: William A. Ince, President
               Facsimile: (360) 752-1983
               Telephone: (360) 752-1982

          With copy to:
               Futro & Associates, P.C.
               1401 - 17th Street, Suite 1150
               Denver, CO  80202
               Attention: Troy A. Young, Esq.
               Facsimile: (303) 295-1563
               Telephone: (303) 2295-3360

                                        3
<PAGE>
                                     FORM OF

          If to a Holder:
             C/o Wellington Management Company, LLP
               75 State Street
               Boston, MA  02109
               Attention: Gina Di Mento
               Facsimile: (617) 204-7535
               Telephone: (617) 790-7535

     Each party shall provide notice to the other party of any change in
address.

          4.4     No Third-Party Benefits; Successors and Assigns.  None of the
                  -----------------------------------------------
provisions of this Warrant shall be for the benefit of, or enforceable by, any
third-party beneficiary.  Except as provided herein to the contrary, this
Warrant shall be binding upon and inure to the benefit of the parties, their
respective successors and permitted assigns.  The Holder may assign its rights
and obligations under this Warrant to any third party if done so in compliance
with the requirements of Section 2.

          4.5     Governing Law.  This Warrant shall be governed by and
                  -------------
construed in accordance with the laws of the State of Nevada applicable to
agreements made and to be performed in the State of Nevada (without regard to
principles of conflict of laws).  Both parties irrevocably consent to the
exclusive jurisdiction of the United States federal courts and the state courts
located in Nevada with respect to any suit or proceeding based on or arising
under this Warrant, the agreements entered into in connection herewith or the
transactions contemplated hereby or thereby and irrevocably agree that all
claims in respect of such suit or proceeding may be determined in such courts.
The Company and the Holder irrevocably waives the defense of an inconvenient
forum to the maintenance of such suit or proceeding.  The Company and the Holder
further agrees that service of process upon a party mailed by first class mail
shall be deemed in every respect effective service of process upon the party in
any such suit or proceeding.  Nothing herein shall affect either party's right
to serve process in any other manner permitted by law.  Each of the parties
agrees that a final non-appealable judgment in any such suit or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on such
judgment or in any other lawful manner.

          4.6     Waivers Strictly Construed.  With regard to any power, remedy
                  --------------------------
or right provided herein or otherwise available to any party hereunder (i) no
waiver or extension of time shall be effective unless expressly contained in a
writing signed by the waiving party, and (ii) no alteration, modification or
impairment shall be implied by reason of any previous waiver, extension of time,
delay or omission in exercise, or other indulgence.

          4.7     Severability.  The validity, legality or enforceability of the
                  ------------
remainder of this Warrant shall not be affected even if one or more of its
provisions shall be held to be invalid, illegal or unenforceable in any respect.

                                        4
<PAGE>
                                     FORM OF

     IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed
effective as of __________ ___, 2003.

                              INTEGRAL TECHNOLOGIES, INC.

                              By:_____________________________

                              Name:___________________________

                              Title:__________________________

Attest:

By:_________________________
Name:_______________________
Title:______________________

                                        5
<PAGE>
                                     FORM OF

                                 ASSIGNMENT FORM

                    (To Be Executed Upon Transfer of Warrant)

     FOR  VALUE  RECEIVED,  ______________________________ hereby sells, assigns
and  transfers  to  the transferee named below the rights to purchase ___ of the
Number  of  Shares  under  this  Warrant,  together  with  all rights, title and
interest  therein.  The  rights to purchase the remaining Number of Shares shall
remain  the  property  of  the  undersigned.  This  includes  a  transfer of the
registration  rights.

                              [NAME OF HOLDER]

Dated: _______________        By:__________________________________
                                           Signature

                              Name:________________________________
                                         (Please Print)

                              Title:_______________________________

                              Address:_____________________________

                                      _____________________________

                                      _____________________________

                              Employer Identification Number,
                              Social Security Number or other
                              identifying number:___________________________

TRANSFEREE:

Name:___________________________
          (Please Print)

Address:________________________

        ________________________

        ________________________

Employer Identification Number,
Social Security Number or other
identifying number:__________________

                                        6
<PAGE>
                                     FORM OF

                                  EXERCISE FORM

                    (To Be Executed Upon Exercise of Warrant)

     The  undersigned  hereby exercises the Warrant with regard to _____________
shares  of  Common  Stock  at  no  additional  consideration by the Holder.  The
undersigned requests that the certificate(s) for such shares and the Warrant for
the  unexercised  portion  of  this  Warrant  be  issued  to  the  Holder.

                              [NAME OF HOLDER]

Dated: __________________     By:__________________________________
                                          Signature

                              Name:________________________________
                                        (Please Print)

                              Title:_______________________________

                              Address:_____________________________

                                      _____________________________

                                      _____________________________

                              Employer Identification Number,
                              Social Security Number or other
                              identifying number:__________________

TRANSFEREE:

Name:___________________________
          (Please Print)

Address:________________________

        ________________________

        ________________________

Employer Identification Number,
Social Security Number or other
identifying number:__________________

                                        7
<PAGE>EXHIBIT 10.1

                          SECURITIES PURCHASE AGREEMENT

     This  Securities  Purchase  Agreement  (this  "Agreement")  is  dated as of
                                                    ---------
January  12,  2004, among eLinear, Inc., a Delaware corporation (the "Company"),
                                                                      -------
and  the purchasers identified on the signature pages hereto (each a "Purchaser"
                                                                      ---------
and  collectively  the  "Purchasers");  and
                         ----------

     WHEREAS,  subject  to  the terms and conditions set forth in this Agreement
and  pursuant to Section 4(2) of the Securities Act (as defined below), and Rule
506  promulgated  thereunder,  the  Company  desires  to  issue  and sell to the
Purchasers,  and  the Purchasers, severally and not jointly, desires to purchase
from the Company in the aggregate, up to $3,500,000 of Common Stock and Warrants
on  the  Closing  Date.

     NOW,  THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement,  and  for  other  good  and  valuable  consideration  the receipt and
adequacy of which are hereby acknowledged, the Company and each Purchaser agrees
as  follows:

                                   ARTICLE I.
                                   DEFINITIONS

     1.1  Definitions.  In  addition  to  the  terms  defined  elsewhere in this
          -----------
Agreement,  for  all  purposes  of  this Agreement, the following terms have the
meanings  indicated  in  this  Section  1.1:

          "Action"  shall  have  the  meaning  ascribed  to such term in Section
           ------
     3.1(j).

          "Affiliate"  means any Person that, directly or indirectly through one
           ---------
     or  more  intermediaries,  controls  or is controlled by or is under common
     control  with  a  Person as such terms are used in and construed under Rule
     144.  With  respect  to a Purchaser, any investment fund or managed account
     that  is managed on a discretionary basis by the same investment manager as
     such Purchaser will be deemed to be an Affiliate of such Purchaser.

          "Closing"  means  the  closing  of the purchase and sale of the Common
           -------
     Stock and the Warrants pursuant to Section 2.1.

          "Closing  Date"  means  the  Trading  Day  when all of the Transaction
           -------------
     Documents  have  been  executed  and  delivered  by  the applicable parties
     thereto, and all conditions precedent to (i) the Purchasers' obligations to
     pay  the  Subscription Amount and (ii) the Company's obligations to deliver
     the  Securities  have  been  satisfied  or  waived.

          "Closing  Price"  means  on  any particular date (a) the last reported
           --------------
     closing  bid  price  per  share of Common Stock on such date on the Trading
     Market (as reported by Bloomberg L.P. at 4:15 PM (New York time), or (b) if
     there  is  no  such  price  on such date, then the closing bid price on the
     Trading  Market  on  the  date  nearest preceding such date (as reported by
     Bloomberg  L.P.  at  4:15  PM (New York time) for the closing bid price for
     regular  session  trading  on  such day), or (c) if the Common Stock is not
     then  listed  or  quoted on the Trading Market and if prices for the Common
     Stock  are  then  reported  in  the "pink sheets" published by the National
     Quotation  Bureau  Incorporated  (or  a  similar  organization  or  agency
     succeeding to its functions of reporting prices), the most recent bid price
     per  share  of the Common Stock so reported, or (d) if the shares of Common
     Stock  are  not  then  publicly  traded the fair market value of a share of
     Common  Stock  as  determined by an appraiser selected in good faith by the
     Purchasers  of  a  majority  in  interest  of  the Shares then outstanding.

          "Commission" means the Securities and Exchange Commission.
           ----------

<PAGE>
          "Common  Stock" means the common stock of the Company, $0.02 par value
           -------------
     per share, and any securities into which such common stock may hereafter be
     reclassified.

          "Common  Stock Equivalents" means any securities of the Company or the
           -------------------------
     Subsidiaries  which would entitle the holder thereof to acquire at any time
     Common  Stock,  including  without  limitation,  any debt, preferred stock,
     rights,  options,  warrants  or  other  instrument  that  is  at  any  time
     convertible  into  or  exchangeable  for,  or otherwise entitles the holder
     thereof  to  receive,  Common  Stock.

          "Company  Counsel"  means  Brewer  &  Pritchard,  P.C.
           ----------------

          "Disclosure  Schedules"  means  the  Disclosure  Schedules  delivered
           ---------------------
     concurrently  herewith.

          "Effective  Date"  means  the  date that the Registration Statement is
           ---------------
     first  declared  effective  by  the  Commission.

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

          "FW" means Feldman Weinstein LLP with offices located at 420 Lexington
           --
     Avenue,  New  York,  New  York  10170-0002.

          "Intellectual Property Rights" shall have the meaning ascribed to such
           ----------------------------
     term  in  Section  3.1(o).

          "Liens" means a lien, charge, security interest, encumbrance, right of
           -----
     first  refusal,  preemptive  right  or  other  restriction.

          "Material Adverse Effect" shall have the meaning ascribed to such term
           -----------------------
     in  Section  3.1(b).

          "Material  Permits"  shall  have  the meaning ascribed to such term in
           -----------------
     Section  3.1(m).

          "Per  Share  Purchase  Price"  equals $1.29, subject to adjustment for
           ---------------------------
     reverse  and  forward stock splits, stock dividends, stock combinations and
     other similar transactions of the Common Stock that occur after the date of
     this  Agreement.

          "Person"  means  an  individual  or  corporation,  partnership, trust,
           ------
     incorporated  or  unincorporated  association,  joint  venture,  limited
     liability  company,  joint  stock  company,  government  (or  an  agency or
     subdivision  thereof)  or  other  entity  of  any  kind.

          "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.

          "Registration  Statement"  means  a registration statement meeting the
           -----------------------
     requirements  set  forth  in the Registration Rights Agreement and covering
     the  resale  by  the  Purchasers  of  the  Shares  and  the Warrant Shares.

          "Registration  Rights  Agreement"  means  the  Registration  Rights
           -------------------------------
     Agreement,  dated  as  of the date of this Agreement, among the Company and
     each  Purchaser,  in  the  form  of  Exhibit  A  hereto.
                                          ----------

          "Required  Approvals"  shall have the meaning ascribed to such term in
           -------------------
     Section  3.1(e).

<PAGE>
          "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.

          "SEC  Reports" shall have the meaning ascribed to such term in Section
           ------------
     3.1(h).

          "Securities"  means  the  Shares, the Warrants and the Warrant Shares.
           ----------

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

          "Shares"  means  the shares of Common Stock issued or issuable to each
           ------
     Purchaser  pursuant  to  this  Agreement.

          "Subscription  Amount"  means,  as  to each Purchaser, the amounts set
           --------------------
     forth  below such Purchaser's signature block on the signature page hereto,
     in  United  States  dollars  and  in  immediately  available  funds.

          "Subsidiary"  shall  mean the subsidiaries of the Company, if any, set
           ----------
     forth  on  Schedule  3.1(a)  of  the  Disclosure  Schedule.
                ----------------

          "Trading Day" means (i) a day on which the Common Stock is traded on a
           -----------
     Trading  Market,  or  (ii)  if  the Common Stock is not quoted on a Trading
     Market,  a  day on which the Common Stock is quoted in the over-the-counter
     market  as  reported  by the National Quotation Bureau Incorporated (or any
     similar  organization  or  agency  succeeding  its  functions  of reporting
     prices).

          "Trading Market" means the following markets or exchanges on which the
           --------------
     Common  Stock  is listed or quoted for trading on the date in question: the
     OTC  Bulletin  Board,  the  American  Stock  Exchange,  the  New York Stock
     Exchange, the Nasdaq National Market or the Nasdaq SmallCap Market.

          "Transaction  Documents"  means  this  Agreement, the Warrants and the
           ----------------------
     Registration  Rights  Agreement  and  any  other  documents  or  agreements
     executed in connection with the transactions contemplated hereunder.

          "Warrants"  means  the  Series  A  and  Series B Common Stock Purchase
           --------
     Warrants,  in  the form of Exhibits C-1 and C-2, issuable to the Purchasers
                                --------------------
     at  the  Closing,  which Series A Warrants shall be exercisable immediately
     upon  issuance  for  a  term of 5 years and have an exercise price equal to
     $1.89,  and  which  Series B Warrants shall be exercisable immediately upon
     issuance  for  a  term ending on the earlier of 14 months after the Closing
     Date  or  8  months following the Effective Date and have an exercise price
     equal  to  $1.55.

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

                                   ARTICLE II.
                                PURCHASE AND SALE

     2.1  Closing.  On  the Closing Date, each Purchaser shall purchase from the
Company,  severally  and  not jointly with the other Purchasers, and the Company
shall  issue  and  sell  to each Purchaser, (a) a number of Shares equal to such
Purchaser's  Subscription Amount divided by the Per Share Purchase Price and (b)
the  Warrants  as  determined  pursuant  to  Section 2.2(a)(iii).  The aggregate
Subscription  Amounts for Shares sold hereunder shall be up to $3,500,000.  Upon
satisfaction of the conditions set forth in Section 2.2, the Closing shall occur
at the offices of FW or such other location as the parties shall mutually agree.

<PAGE>
     2.2     Closing Conditions; Deliveries

          (a)     On  the Closing Date, the Company shall deliver or cause to be
     delivered  to  each  Purchaser  the  following:

               (i)  this  Agreement  duly  executed  by  the  Company;

               (ii)  a  certificate  evidencing a number of Shares equal to such
          Purchaser's  Subscription  Amount  divided  by  the Per Share Purchase
          Price,  registered  in  the  name  of  such  Purchaser;

               (iii)  a  Series  A  Warrant,  registered  in  the  name  of such
          Purchaser,  pursuant  to  which such Purchaser shall have the right to
          acquire up to the number of shares of Common Stock equal to 60% of the
          number  of Shares to be issued to such Purchaser at the Closing; and a
          Series B Warrant registered in the name of such Purchaser, pursuant to
          which such Purchaser shall have the right to purchase such Purchaser's
          pro  rata share (based on the number of shares purchased hereunder) of
          two-thirds  of the aggregate Subscription Amounts divided by $1.55 and
          which  shall  be  exercisable  immediately  and have an exercise price
          equal  to  $1.55 and be exercisable for a period ending on the earlier
          of  14 months from the Closing Date or eight months from the Effective
          Date;

               (iv)  the  Registration  Rights  Agreement  duly  executed by the
          Company;  and

               (v)  a legal opinion of Company Counsel, in the form of Exhibit B
                                                                       ---------
          attached  hereto.

          (b)  On  the Closing Date, each Purchaser shall deliver or cause to be
     delivered  to  the  Company  the  following:

               (i)  this  Agreement  duly  executed  by  such  Purchaser;

               (ii) such Purchaser's Subscription Amount by wire transfer to the
          account  of  the  Company;  and

               (iii) the  Registration  Rights  Agreement  duly executed by such
          Purchaser.

          (c)  All  representations  and warranties of the other party contained
     herein  shall  remain  true  and  correct  as  of  the  Closing  Date.

          (d)  All obligations, covenants and agreements of the parties required
     to  be performed at or prior to the Closing Date shall have been performed.

          (e)  From  the  date hereof to the Closing Date, trading in the Common
     Stock  shall  not  have  been suspended by the Commission, and, at any time
     prior  to  the Closing Date, trading in securities generally as reported by
     Bloomberg  Financial  Markets  shall not have been suspended or limited, or
     minimum  prices  shall not have been established on securities whose trades
     are reported by such service, or on any Trading Market, nor shall a banking
     moratorium have been declared either by the United States or New York State
     authorities  nor  shall  there  have  occurred  any  material  outbreak  or
     escalation  of  hostilities  or other national or international calamity of
     such  magnitude  in  its  effect on, or any material adverse change in, any
     financial  market  which,  in each case, in the reasonable judgment of each
     Purchaser,  makes it impracticable or inadvisable to purchase the Shares at
     the  such  Closing.

<PAGE>
                                  ARTICLE III.
                         REPRESENTATIONS AND WARRANTIES

     3.1  Representations  and  Warranties  of  the Company. Except as set forth
          -------------------------------------------------
under  the  corresponding  section  of  the  Disclosure  Schedules  delivered
concurrently  herewith,  the  Company hereby makes the following representations
and  warranties  as  of  the  date  hereof  and  as  of the Closing Date to each
Purchaser:

          (a)  Subsidiaries.  All  of  the  subsidiaries  of the Company are set
               ------------
     forth  on  Schedule  3.1(a)  of  the Disclosure Schedule. The Company owns,
                ---------------
     directly  or indirectly, all of the capital stock or other equity interests
     of  each  Subsidiary  free  and  clear of any Liens, and all the issued and
     outstanding  shares  of capital stock of each Subsidiary are validly issued
     and  are  fully  paid,  non-assessable  and  free of preemptive and similar
     rights  to  subscribe  for  or  purchase  securities. If the Company has no
     subsidiaries,  then  references  in  the  Transaction  Documents  to  the
     Subsidiaries  will  be  disregarded.

          (b)  Organization  and Qualification.  Except as set forth in Schedule
               -------------------------------
     3.1(b),  each  of  the  Company  and  the  Subsidiaries  is  an entity duly
     incorporated  or otherwise organized, validly existing and in good standing
     under the laws of the jurisdiction of its incorporation or organization (as
     applicable),  with  the  requisite  power  and authority to own and use its
     properties  and assets and to carry on its business as currently conducted.
     Neither  the Company nor any Subsidiary is in material violation or default
     of  any  of  the  provisions  of  its respective certificate or articles of
     incorporation, bylaws or other organizational or charter documents. Each of
     the  Company and the Subsidiaries is duly qualified to conduct business and
     is  in  good  standing  as  a  foreign  corporation or other entity in each
     jurisdiction  in  which  the  nature  of the business conducted or property
     owned by it makes such qualification necessary, except where the failure to
     be  so qualified or in good standing, as the case may be, could not have or
     reasonably  be  expected  to result in (i) a material adverse effect on the
     legality,  validity  or  enforceability of any Transaction Document, (ii) a
     material  adverse  effect  on  the results of operations, assets, business,
     prospects or financial condition of the Company and the Subsidiaries, taken
     as  a whole, or (iii) a material adverse effect on the Company's ability to
     perform in any material respect on a timely basis its obligations under any
     Transaction  Document  (any  of  (i),  (ii)  or  (iii), a "Material Adverse
                                                               -----------------
     Effect")  and  no  Proceeding  has been instituted in any such jurisdiction
     ------
     revoking,  limiting  or  curtailing  or seeking to revoke, limit or curtail
     such  power  and  authority  or  qualification.

          (c)  Authorization;  Enforcement.  The  Company  has  the  requisite
               ---------------------------
     corporate  power  and  authority  to  enter  into  and  to  consummate  the
     transactions  contemplated  by  each  of  the  Transaction  Documents  and
     otherwise  to  carry  out  its  obligations  thereunder.  The execution and
     delivery  of  each  of  the  Transaction  Documents  by the Company and the
     consummation  by it of the transactions contemplated thereby have been duly
     authorized  by  all  necessary  action  on  the  part of the Company and no
     further  action  is  required  by the Company in connection therewith other
     than  in  connection with the Required Approvals. Each Transaction Document
     has  been  (or  upon  delivery will have been) duly executed by the Company
     and,  when  delivered  in accordance with the terms hereof, will constitute
     the  valid  and  binding  obligation of the Company enforceable against the
     Company  in  accordance  with its terms except (i) as limited by applicable
     bankruptcy,  insolvency,  reorganization,  moratorium  and  other  laws  of
     general  application  affecting  enforcement of creditors' rights generally
     and  (ii)  as  limited  by  laws  relating  to the availability of specific
     performance,  injunctive  relief  or  other  equitable  remedies.

          (d)  No  Conflicts.  The  execution,  delivery  and performance of the
               -------------
     Transaction  Documents  by the Company, the issuance and sale of the Shares
     and  the consummation by the Company of the other transactions contemplated
     thereby  do  not and will not (i) conflict with or violate any provision of
     the Company's or any Subsidiary's certificate or articles of incorporation,
     bylaws or other organizational or charter documents, or (ii) conflict with,
     or  constitute  a default (or an event that with notice or lapse of time or
     both  would  become  a  default)  under,  result  in  the

<PAGE>
     creation of any Lien upon any of the properties or assets of the Company or
     any  Subsidiary,  or  give  to others any rights of termination, amendment,
     acceleration  or  cancellation  (with  or  without notice, lapse of time or
     both)  of,  any  agreement,  credit  facility,  debt  or  other  instrument
     (evidencing  a  Company  or  Subsidiary  debt  or  otherwise)  or  other
     understanding to which the Company or any Subsidiary is a party or by which
     any  property  or  asset  of  the  Company  or  any  Subsidiary is bound or
     affected,  or  (iii)  subject  to  the Required Approvals, conflict with or
     result  in  a  violation  of  any  law,  rule, regulation, order, judgment,
     injunction,  decree  or  other  restriction  of  any  court or governmental
     authority  to  which  the  Company  or  a  Subsidiary is subject (including
     federal  and  state  securities  laws  and  regulations),  or  by which any
     property  or  asset of the Company or a Subsidiary is bound or affected, or
     (iv)  conflict  with  or  violate  the  terms of any agreement by which the
     Company or any Subsidiary is bound or to which any property or asset of the
     Company  or any Subsidiary is bound or affected; except in the case of each
     of clauses (ii) and (iii), such as could not have or reasonably be expected
     to  result  in  a  Material  Adverse  Effect.

          (e)  Filings,  Consents and Approvals.  The Company is not required to
               --------------------------------
     obtain  any consent, waiver, authorization or order of, give any notice to,
     or make any filing or registration with, any court or other federal, state,
     local  or  other  governmental authority or other Person in connection with
     the  execution,  delivery and performance by the Company of the Transaction
     Documents,  other than (i) filings required pursuant to Section 4.6 of this
     Agreement,  (ii)  the  filing  with  the  Commission  of  the  Registration
     Statement,  (iii)  application(s) to each applicable Trading Market for the
     listing  of  the  Shares and Warrant Shares for trading thereon in the time
     and  manner  required  thereby,  and  (iv)  the  filing  of Form D with the
     Commission  and  such  filings  as are required to be made under applicable
     state  securities  laws  (collectively,  the  "Required  Approvals").
                                                    -------------------

          (f)  Issuance  of  the Securities.  The Securities are duly authorized
               ----------------------------
     and, when issued and paid for in accordance with the Transaction Documents,
     will  be  duly  and  validly issued, fully paid and nonassessable, free and
     clear  of  all  Liens.  The  issuance  of  the Shares is not subject to any
     preemptive  or  similar rights to subscribe for or purchase securities. The
     Company  has  reserved  from  its duly authorized capital stock the maximum
     number  of  shares  of Common Stock issuable pursuant to this Agreement and
     the  Warrants.

          (g)  Capitalization.  Except  as  set  forth  Schedule  3.1(g),  the
               --------------
     capitalization  of the Company is as described in the Company's most recent
     periodic  report  filed with the Commission. The Company has not issued any
     capital  stock  since  such  filing  other than pursuant to the exercise of
     employee stock options under the Company's stock option plans, the issuance
     of  shares  of Common Stock to employees pursuant to the Company's employee
     stock  purchase  plan  and  pursuant  to  the  conversion  or  exercise  of
     outstanding  Common  Stock Equivalents outstanding. No Person has any right
     of  first refusal, preemptive right, right of participation, or any similar
     right  to  participate  in the transactions contemplated by the Transaction
     Documents.  Except  as  a result of the purchase and sale of the Securities
     and except as set forth in the SEC Reports or in Schedule 3.1(g), there are
     no  outstanding  options, warrants, script rights to subscribe to, calls or
     commitments  of any character whatsoever relating to, or securities, rights
     or  obligations  convertible into or exchangeable for, or giving any Person
     any  right  to  subscribe  for  or  acquire, any shares of Common Stock, or
     contracts, commitments, understandings or arrangements by which the Company
     or  any  Subsidiary  is  or  may become bound to issue additional shares of
     Common  Stock,  or  securities  or  rights convertible or exchangeable into
     shares  of  Common  Stock.  The  issue  and sale of the Securities will not
     obligate the Company to issue shares of Common Stock or other securities to
     any  Person  (other  than the Purchasers) and will not result in a right of
     any  holder  of  Company  securities  to  adjust  the exercise, conversion,
     exchange  or  reset  price  under  such  securities. All of the outstanding
     shares  of  capital stock of the Company are validly issued, fully paid and
     nonassessable,  have  been  issued in compliance with all federal and state
     securities  laws,  and  none  of  such  outstanding  shares  was  issued in
     violation  of  any  preemptive rights or similar rights to subscribe for or
     purchase  securities.  No  further  approval  or  authorization  of  any
     stockholder,  the  Board  of Directors of the Company or others is required
     for  the  issuance  and  sale

<PAGE>
     of  the  Shares.  Except  as  disclosed  in  the  SEC Reports, there are no
     stockholders agreements, voting agreements or other similar agreements with
     respect  to the Company's capital stock to which the Company is a party or,
     to  the  knowledge  of  the  Company, between or among any of the Company's
     stockholders.

          (h)  SEC  Reports;  Financial  Statements.  The  Company has filed all
               ------------------------------------
     reports  required  to  be  filed  by  it  under  the Securities Act and the
     Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
     two  years preceding the date hereof (or such shorter period as the Company
     was  required  by  law  to  file  such  material) (the foregoing materials,
     including  the  exhibits  thereto, being collectively referred to herein as
     the  "SEC Reports"). As of their respective dates, the SEC Reports complied
           -----------
     in  all  material  respects with the requirements of the Securities Act and
     the  Exchange  Act  and  the  rules  and  regulations  of  the  Commission
     promulgated  thereunder, and none of the SEC Reports, when filed, contained
     any untrue statement of a material fact or omitted to state a material fact
     required  to be stated therein or necessary in order to make the statements
     therein,  in  light  of  the  circumstances under which they were made, not
     misleading;  provided  that  if  any SEC Report was later amended, only the
     final  amendment  of  such  report  shall  be  considered in evaluating the
     representations  set  forth  in  the  prior  sentence and the following two
     sentences.  The  financial  statements  of  the Company included in the SEC
     Reports  comply  in  all  material  respects  with  applicable  accounting
     requirements  and  the rules and regulations of the Commission with respect
     thereto  as in effect at the time of filing. Such financial statements have
     been  prepared  in  accordance  with  United  States  generally  accepted
     accounting  principles  applied  on  a  consistent basis during the periods
     involved  ("GAAP"),  except as may be otherwise specified in such financial
                 ----
     statements  or  the  notes  thereto  and  except  that  unaudited financial
     statements  may  not  contain  all  footnotes  required by GAAP, and fairly
     present  in all material respects the financial position of the Company and
     its  consolidated  subsidiaries  as  of  and  for the dates thereof and the
     results  of  operations and cash flows for the periods then ended, subject,
     in  the case of unaudited statements, to normal, immaterial, year-end audit
     adjustments.

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

          (j)  Litigation.  Except  as disclosed in the SEC Reports and Schedule
               ----------
     3(j), there is no action, suit, inquiry, notice of violation, proceeding or
     investigation  pending  or,  to  the  knowledge  of the Company, threatened
     against or affecting the Company, any Subsidiary or any of their respective
     properties  before  or  by  any  court,  arbitrator,  governmental  or
     administrative  agency  or  regulatory  authority  (federal, state, county,
     local  or  foreign) (collectively, an "Action") which (i) adversely affects
                                            ------
     or  challenges  the  legality,  validity  or  enforceability  of any of the
     Transaction  Documents  or  the  Securities or (ii) could, if there were an
     unfavorable  decision,  have  or  reasonably  be  expected  to  result in a
     Material  Adverse  Effect.  Neither the Company nor any Subsidiary, nor any
     director  or  officer  thereof,  is  or  has been the subject of any Action
     involving  a  claim  of  violation  of  or liability under federal or state
     securities laws or a claim of breach of fiduciary duty. There has not been,
     and  to the knowledge of the Company, there is not pending or contemplated,
     any investigation by the Commission involving the Company or any current or
     former  director  or  officer of the Company. The Commission has not issued
     any  stop  order  or

<PAGE>
     other  order  suspending  the  effectiveness  of any registration statement
     filed  by  the  Company  or  any  Subsidiary  under the Exchange Act or the
     Securities  Act.

          (k)  Labor  Relations.  No  material  labor  dispute exists or, to the
               ----------------
     knowledge  of the Company, is imminent with respect to any of the employees
     of  the  Company which could reasonably be expected to result in a Material
     Adverse  Effect.

          (l)  Compliance.  Except  as disclosed in the SEC Reports, neither the
               ----------
     Company  nor any Subsidiary (i) is in default under or in violation of (and
     no  event  has occurred that has not been waived that, with notice or lapse
     of time or both, would result in a default by the Company or any Subsidiary
     under),  nor  has  the Company or any Subsidiary received notice of a claim
     that  it  is in default under or that it is in violation of, any indenture,
     loan  or  credit agreement or any other agreement or instrument to which it
     is a party or by which it or any of its properties is bound (whether or not
     such  default  or  violation  has been waived), (ii) is in violation of any
     order  of  any  court,  arbitrator or governmental body, or (iii) is or has
     been  in  violation  of any statute, rule or regulation of any governmental
     authority,  including  without  limitation  all foreign, federal, state and
     local laws applicable to its business except in each case as could not have
     a  Material  Adverse  Effect.

          (m)  Regulatory Permits.  The Company and the Subsidiaries possess all
               ------------------
     certificates, authorizations and permits issued by the appropriate federal,
     state,  local  or foreign regulatory authorities necessary to conduct their
     respective  businesses  as  described  in the SEC Reports, except where the
     failure to possess such permits could not have or reasonably be expected to
     result  in  a Material Adverse Effect ("Material Permits"), and neither the
                                             ----------------
     Company  nor any Subsidiary has received any notice of proceedings relating
     to  the  revocation  or  modification  of  any  Material  Permit.

          (n)  Title  to  Assets.  Except  as  se  forth on Schedule 3.1(n), the
               -----------------
     Company  and  the Subsidiaries have good and marketable title in fee simple
     to  all real property owned by them that is material to the business of the
     Company  and the Subsidiaries and good and marketable title in all personal
     property  owned by them that is material to the business of the Company and
     the  Subsidiaries,  in  each  case  free and clear of all Liens, except for
     Liens  as  do  not  materially affect the value of such property and do not
     materially  interfere  with  the  use  made and proposed to be made of such
     property  by  the Company and the Subsidiaries and Liens for the payment of
     federal,  state  or other taxes, the payment of which is neither delinquent
     nor subject to penalties. Any real property and facilities held under lease
     by  the  Company  and  the  Subsidiaries  are  held  by  them  under valid,
     subsisting and enforceable leases of which the Company and the Subsidiaries
     are  in  compliance.

          (o)  Patents and Trademarks.  To the knowledge of the Company and each
               ----------------------
     Subsidiary,  the  Company and the Subsidiaries have, or have rights to use,
     all  patents,  patent  applications,  trademarks,  trademark  applications,
     service  marks,  trade names, copyrights, licenses and other similar rights
     that  are necessary or material for use in connection with their respective
     businesses as described in the SEC Reports and which the failure to so have
     could have or reasonably be expected to result in a Material Adverse Effect
     (collectively, the "Intellectual Property Rights"). Neither the Company nor
                         ----------------------------
     any Subsidiary has received a written notice that the Intellectual Property
     Rights used by the Company or any Subsidiary violates or infringes upon the
     rights  of  any  Person.  To  the  knowledge  of  the  Company,  all  such
     Intellectual Property Rights are enforceable and do not violate or infringe
     the  Intellectual  Property  Rights  of  others.

          (p)  Insurance.  The  Company  and  the  Subsidiaries  are  insured by
               ---------
     insurers  of  recognized  financial  responsibility against such losses and
     risks and in such amounts as are prudent and customary in the businesses in
     which the Company and the Subsidiaries are engaged. Neither the Company nor
     any  Subsidiary has any reason to believe that it will not be able to renew
     its  existing  insurance  coverage  as and when such coverage expires or to
     obtain  similar  coverage

<PAGE>
     from  similar insurers as may be necessary to continue its business without
     a  significant  increase  in  cost.

          (q)  Transactions  With Affiliates and Employees.  Except as set forth
               -------------------------------------------
     in  the  SEC Reports, none of the officers or directors of the Company and,
     to  the  knowledge  of the Company, none of the employees of the Company is
     presently  a  party  to  any transaction with the Company or any Subsidiary
     (other  than  for services as employees, officers and directors), including
     any  contract,  agreement or other arrangement providing for the furnishing
     of  services to or by, providing for rental of real or personal property to
     or  from,  or otherwise requiring payments to or from any officer, director
     or  such  employee or, to the knowledge of the Company, any entity in which
     any  officer,  director, or any such employee has a substantial interest or
     is  an  officer,  director,  trustee  or partner, in each case in excess of
     $60,000  other  than  (i)  for  payment  of  salary  or consulting fees for
     services  rendered,  (ii)  reimbursement for expenses incurred on behalf of
     the  Company  and (iii) for other employee benefits, including stock option
     agreements  under  any  stock  option  plan  of  the  Company.

          (r)  Sarbanes-Oxley;  Internal Accounting Controls.  The Company is in
               ---------------------------------------------
     material  compliance  with all provisions of the Sarbanes-Oxley Act of 2002
     which  are applicable to it as of the Closing Date. The Company and each of
     its  subsidiaries  maintains  a  system  of  internal  accounting  controls
     sufficient  to  provide  reasonable  assurance  that  (i)  transactions are
     executed  in  accordance  with  management's  general  or  specific
     authorizations,  (ii)  transactions  are  recorded  as  necessary to permit
     preparation of financial statements in conformity with GAAP and to maintain
     asset  accountability,  (iii)  access  to  assets  is  permitted  only  in
     accordance  with  management's  general or specific authorization, and (iv)
     the recorded accountability for assets is compared with the existing assets
     at reasonable intervals and appropriate action is taken with respect to any
     differences. The Company has established disclosure controls and procedures
     (as  defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company
     and  designed  such  disclosure  controls  and  procedures  to  ensure that
     material  information  relating to the Company, including its subsidiaries,
     is  made  known to the certifying officers by others within those entities,
     particularly  during  the  period  in  which  the  Company's Form 10-KSB or
     10-QSB,  as  the  case  may be, is being prepared. The Company's certifying
     officers  have  evaluated  the  effectiveness of the Company's controls and
     procedures  as  of end of the filing period prior to the filing date of the
     Form  10-QSB  for  the  quarter  ended  September  30, 2003 (such date, the
     "Evaluation  Date").  The Company presented in its most recently filed Form
      ----------------
     10-KSB  or Form 10-QSB the conclusions of the certifying officers about the
     effectiveness  of  the  disclosure  controls  and procedures based on their
     evaluations  as  of  the  Evaluation Date. Since the Evaluation Date, there
     have  been  no  significant  changes in the Company's internal controls (as
     such  term  is  defined in Item 307(b) of Regulation S-K under the Exchange
     Act)  or,  to  the  Company's  knowledge,  in  other  factors  that  could
     significantly  affect  the  Company's  internal  controls.

          (s)  Certain  Fees.  The  Purchasers  shall  have  no  obligation with
               -------------
     respect to any brokerage or finder's fees or commissions or with respect to
     any  claims  made  by  or  on  behalf  of  other Persons for fees of a type
     contemplated  in  this  Section  that  may  be  due  in connection with the
     transactions  contemplated  by  this  Agreement.

          (t)  Private  Placement.  Assuming  the  accuracy  of  the  Purchasers
               ------------------
     representations  and  warranties  set forth in Section 3.2, no registration
     under  the  Securities  Act  is  required  for  the  offer  and sale of the
     Securities  by  the  Company  to the Purchasers as contemplated hereby. The
     issuance and sale of the Securities hereunder does not contravene the rules
     and  regulations  of  the  Trading  Market.

          (u)  Investment  Company.  The Company is not, and is not an Affiliate
               --------------------
     of, and immediately after receipt of payment for the Shares, will not be or
     be  an  Affiliate  of,  an  "investment  company" within the meaning of the
     Investment  Company  Act  of  1940,  as  amended.

<PAGE>
     The  Company  shall  conduct  its  business in a manner so that it will not
     become  subject  to  the  Investment  Company  Act.

          (v)  Registration  Rights.  Except as set forth in Schedule 3.1(v), no
               --------------------
     Person  has any right to cause the Company to effect the registration under
     the  Securities  Act  of  any  securities  of  the  Company.

          (w)  Listing and Maintenance Requirements.  The Company's Common Stock
               ------------------------------------
     is  registered  pursuant  to  Section  12(g)  of  the Exchange Act, and the
     Company  has  taken  no  action  designed  to, or which to its knowledge is
     likely  to  have  the effect of, terminating the registration of the Common
     Stock  under the Exchange Act nor has the Company received any notification
     that  the  Commission  is  contemplating terminating such registration. The
     Company  has  not,  in  the  12  months preceding the date hereof, received
     notice  from  any  Trading  Market on which the Common Stock is or has been
     listed  or  quoted to the effect that the Company is not in compliance with
     the listing or maintenance requirements of such Trading Market. The Company
     is, and has no reason to believe that it will not in the foreseeable future
     continue  to  be,  in  compliance  with  all  such  listing and maintenance
     requirements.

          (x)  Application  of  Takeover Protections.  The Company and its Board
               -------------------------------------
     of  Directors  have  taken all necessary action, if any, in order to render
     inapplicable  to the transactions contemplated by the Transaction Documents
     any  poison  pill  (including any distribution under a rights agreement) or
     other  similar  anti-takeover  provision under the Company's Certificate of
     Incorporation  (or  similar  charter documents) or the laws of its state of
     incorporation  that  is  or  could become applicable to the Purchasers as a
     result  of  the  Purchasers and the Company fulfilling their obligations or
     exercising  their rights under the Transaction Documents, including without
     limitation  the  Company's  issuance  of the Securities and the Purchasers'
     ownership  of  the  Securities.

          (y)  Disclosure.  Other than the terms of the transaction contemplated
               ----------
     by  this  Agreement, the Company confirms that, neither the Company nor any
     other  Person  acting  on  its behalf has provided any of the Purchasers or
     their  agents  or  counsel  with  any information that constitutes or might
     constitute  material,  non-public  information. The Company understands and
     confirms that the Purchasers will rely on the foregoing representations and
     covenants  in  effecting  transactions  in  securities  of the Company. All
     disclosure  provided  to the Purchasers regarding the Company, its business
     and  the  transactions  contemplated  hereby,  including  the  Disclosure
     Schedules  to  this Agreement, furnished by or on behalf of the Company are
     true  and  correct  in  all material respects and do not contain any untrue
     statement  of  a material fact or omit to state any material fact necessary
     in order to make the statements made therein, in light of the circumstances
     under  which  they  were  made,  not  misleading.

          (z)  No  Integrated  Offering. Except as set forth in Schedule 3.1(z),
               ------------------------
     assuming the accuracy of the Purchasers' representations and warranties set
     forth  in  Section 3.2, neither the Company, nor any of its affiliates, nor
     any  Person acting on its or their behalf has, directly or indirectly, made
     any  offers  or  sales  of  any security or solicited any offers to buy any
     security,  under  circumstances  that  would  cause  this  offering  of the
     Securities  to  be  integrated  with  prior  offerings  by  the Company for
     purposes  of  the  Securities  Act  or  any applicable shareholder approval
     provisions,  including, without limitation, under the rules and regulations
     of  any  exchange  or  automated  quotation  system  on  which  any  of the
     securities  of  the  Company  are  listed  or  designated.

          (aa) Solvency.  Based  on the financial condition of the Company as of
               --------
     the  Closing  Date after giving effect to the receipt by the Company of the
     proceeds  from the sale of the Securities hereunder, (i) the Company's fair
     saleable value of its assets exceeds the amount that will be required to be
     paid on or in respect of the Company's existing debts and other liabilities
     (including known contingent liabilities) as they mature; (ii) the Company's
     assets  do  not  constitute

<PAGE>
     unreasonably  small capital to carry on its business for the current fiscal
     year as now conducted and as proposed to be conducted including its capital
     needs  taking  into  account  the  particular  capital  requirements of the
     business  conducted  by the Company, and projected capital requirements and
     capital  availability  thereof;  and  (iii)  the  current  cash flow of the
     Company,  together  with the proceeds the Company would receive, were it to
     liquidate all of its assets, after taking into account all anticipated uses
     of the cash, would be sufficient to pay all amounts on or in respect of its
     debt when such amounts are required to be paid. The Company does not intend
     to  incur debts beyond its ability to pay such debts as they mature (taking
     into  account the timing and amounts of cash to be payable on or in respect
     of  its  debt).

          (bb) [Intentionally  Omitted].

          (cc) Taxes.  Except for matters that would not, individually or in the
               -----
     aggregate,  have  or reasonably be expected to result in a Material Adverse
     Effect,  the  Company  and each Subsidiary has filed all necessary federal,
     state  and foreign income and franchise tax returns and has paid or accrued
     all  taxes  shown as due thereon, and the Company has no knowledge of a tax
     deficiency which has been asserted or threatened against the Company or any
     Subsidiary.

          (dd) General  Solicitation.  Assuming  the  representations  made  in
               ---------------------
     Section 3.2 are true and correct, neither the Company nor any person acting
     on  behalf of the Company has offered or sold any of the Shares by any form
     of  general  solicitation  or  general  advertising.  Assuming  the
     representations  made  in Section 3.2 are true and correct, the Company has
     offered  the  Shares  for  sale  only  to  the Purchasers and certain other
     "accredited  investors" within the meaning of Rule 501 under the Securities
     Act.

          (ee) Foreign  Corrupt  Practices.  Neither  the  Company,  nor  to the
               ----------------------------
     knowledge of the Company, any agent or other person acting on behalf of the
     Company,  has  (i)  directly  or  indirectly,  used  any  corrupt funds for
     unlawful  contributions,  gifts,  entertainment  or other unlawful expenses
     related  to  foreign or domestic political activity, (ii) made any unlawful
     payment  to foreign or domestic government officials or employees or to any
     foreign  or  domestic  political parties or campaigns from corporate funds,
     (iii)  failed  to  disclose  fully any contribution made by the Company (or
     made  by  any  person  acting  on its behalf of which the Company is aware)
     which  is in violation of law, or (iv) violated in any material respect any
     provision of the Foreign Corrupt Practices Act of 1977, as amended.

          (ff) Accountants.  The Company's accountants are set forth on Schedule
               -----------                                              --------
     3.1(ff)  of  the  Disclosure  Schedule.  To  the  Company's knowledge, such
     -------
     accountants,  who  the  Company  expects  will  express  their opinion with
     respect  to the financial statements to be included in the Company's Annual
     Report on Form 10-KSB for the year ended December 31, 2003, are independent
     accountants  as  required  by  the  Securities  Act.

          (gg) Acknowledgment  Regarding  Purchasers'  Purchase  of Shares.  The
               -----------------------------------------------------------
     Company  acknowledges  and  agrees  that  each  of the Purchasers is acting
     solely  in  the  capacity  of an arm's length purchaser with respect to the
     Transaction Documents and the transactions contemplated hereby. The Company
     further  acknowledges that no Purchaser is acting as a financial advisor or
     fiduciary  of the Company (or in any similar capacity) with respect to this
     Agreement  and the transactions contemplated hereby and any advice given by
     any  Purchaser  or  any  of  their  respective representatives or agents in
     connection  with this Agreement and the transactions contemplated hereby is
     merely  incidental  to  the Purchasers' purchase of the Shares. The Company
     further  represents  to each Purchaser that the Company's decision to enter
     into  this Agreement has been based solely on the independent evaluation of
     the  transactions  contemplated  hereby  by  the  Company  and  its
     representatives.

<PAGE>
     3.2  Representations  and  Warranties  of  the  Purchasers.  Each Purchaser
          -----------------------------------------------------
hereby, for itself and for no other Purchaser, represents and warrants as of the
date  hereof  and  as  of  the  Closing  Date  to  the  Company  as  follows:

          (a)  Organization;  Authority.  Such  Purchaser  is  an  entity  duly
               ------------------------
     organized,  validly  existing  and  in  good standing under the laws of the
     jurisdiction  of its organization with full right, corporate or partnership
     power  and  authority  to  enter  into  and  to consummate the transactions
     contemplated  by  the  Transaction Documents and otherwise to carry out its
     obligations  thereunder.  The  execution,  delivery and performance by such
     Purchaser of the transactions contemplated by this Agreement have been duly
     authorized by all necessary corporate or similar action on the part of such
     Purchaser.  Each  Transaction  Document  to which it is party has been duly
     executed  by  such  Purchaser,  and  when  delivered  by  such Purchaser in
     accordance  with  the  terms  hereof, will constitute the valid and legally
     binding  obligation of such Purchaser, enforceable against it in accordance
     with  its  terms, except (i) as limited by general equitable principles and
     applicable  bankruptcy,  insolvency,  reorganization,  moratorium and other
     laws  of  general  application  affecting  enforcement of creditors' rights
     generally, (ii) as limited by laws relating to the availability of specific
     performance,  injunctive  relief  or  other  equitable  remedies  and (iii)
     insofar  as  indemnification  and contribution provisions may be limited by
     applicable  law.

          (b)  Investment  Intent.  Such  Purchaser  understands  that  the
               ------------------
     Securities  are  "restricted securities" and have not been registered under
     the  Securities Act or any applicable state securities law and is acquiring
     the  Securities  as  principal  for its own account for investment purposes
     only  and  not  with  a  view  to  or  for  distributing  or reselling such
     Securities  or  any  part thereof, has no present intention of distributing
     any  of  such  Securities  and has no arrangement or understanding with any
     other  persons  regarding  the  distribution  of  such  Securities  (this
     representation and warranty not limiting such Purchaser's right to sell the
     Securities  pursuant  to  the  Registration  Statement  or  otherwise  in
     compliance  with  applicable  federal  and  state  securities  laws).  Such
     Purchaser  is  acquiring the Securities hereunder in the ordinary course of
     its  business. Such Purchaser does not have any agreement or understanding,
     directly or indirectly, with any Person to distribute any of the Securities
     (this  representation  and  warranty not limiting such Purchaser's right to
     sell  the Securities pursuant to the Registration Statement or otherwise in
     compliance  with  applicable  federal  and  state  securities  laws).

          (c)  Purchaser  Status.  At  the  time  such Purchaser was offered the
               -----------------
     Securities,  it  was, and at the date hereof it is an "accredited investor"
     as  defined  in Rule 501(a) under the Securities Act. Such Purchaser is not
     required  to  be  registered  as  a  broker-dealer  under Section 15 of the
     Exchange  Act.

          (d)  Experience  of  Such  Purchaser.  Such Purchaser, either alone or
               -------------------------------
     together  with  its representatives, has such knowledge, sophistication and
     experience  in  business  and  financial  matters  so  as  to be capable of
     evaluating  the  merits  and  risks  of  the  prospective investment in the
     Securities,  and  has so evaluated the merits and risks of such investment.
     Such  Purchaser  is  able to bear the economic risk of an investment in the
     Securities  and  is  able  to  afford  a  complete loss of such investment.

          (e)  General  Solicitation.  Such  Purchaser  is  not  purchasing  the
               ---------------------
     Securities  as  a  result  of  any  advertisement, article, notice or other
     communication regarding the Securities published in any newspaper, magazine
     or  similar media or broadcast over television or radio or presented at any
     seminar  or  any  other  general  solicitation  or  general  advertisement.

          (f)  Broker-Dealer  Status.  Except  as  set  forth on the Purchaser's
               ---------------------
     signature  page  hereto,  Purchaser  is  not  a registered broker-dealer or
     affiliated  with  a  registered  broker-dealer.

<PAGE>
          (g)  Short  Sales.  Purchaser  represents  that  prior to execution of
               ------------
     this Agreement, neither it nor its affiliates have made any short sales of,
     or  granted  any  option for the purchase of or entered into any hedging or
     similar  transaction  with the same economic effect as a short sale, in the
     Common  Stock.

     The  Company  acknowledges  and agrees that each Purchaser does not make or
has  not made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section 3.2.

                                   ARTICLE IV.
                         OTHER AGREEMENTS OF THE PARTIES

     4.1  Restriction  on  Sales,  Short  Sales  and  Hedging  Transactions. The
          -----------------------------------------------------------------
Investor  will  not,  directly  or  indirectly, offer, sell, pledge, transfer or
otherwise  dispose  of  (or  solicit  any  offers  to buy, purchase or otherwise
acquire  or  take  a  pledge of) any of the Shares except in compliance with the
Securities  Act,  applicable  state securities laws and the respective rules and
regulations  promulgated  thereunder.  In  furtherance  of  the  foregoing:

          (a)  The  Securities  may only be disposed of in compliance with state
     and  federal securities laws. In connection with any transfer of Securities
     other  than pursuant to an effective registration statement or Rule 144, to
     the  Company, to an Affiliate of a Purchaser or in connection with a pledge
     as  contemplated  in Section 4.1(b), the Company may require the transferor
     thereof  to  provide  to  the Company an opinion of counsel selected by the
     transferor,  the  form  and  substance of which opinion shall be reasonably
     satisfactory  to  the  Company,  to  the effect that such transfer does not
     require  registration  of  such transferred Securities under the Securities
     Act. As a condition of transfer, any such transferee shall agree in writing
     to  be  bound by the terms of this Agreement and shall have the rights of a
     Purchaser  under  this  Agreement  and  the  Registration Rights Agreement.

          (b)  The Purchasers agree to the imprinting, so long as is required by
     this  Section 4.1(b), of a legend on any of the Securities in the following
     form:

          THESE  SECURITIES  HAVE  NOT  BEEN  REGISTERED WITH THE SECURITIES AND
          EXCHANGE  COMMISSION  OR  THE  SECURITIES  COMMISSION  OF ANY STATE IN
          RELIANCE  UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
          OF  1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
          BE  OFFERED  OR  SOLD  EXCEPT  PURSUANT  TO  AN EFFECTIVE REGISTRATION
          STATEMENT  UNDER  THE  SECURITIES  ACT  OR  PURSUANT  TO  AN AVAILABLE
          EXEMPTION  FROM,  OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
          REQUIREMENTS  OF  THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE
          STATE  SECURITIES  LAWS  AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
          THE  TRANSFEROR  TO  SUCH  EFFECT,  THE  SUBSTANCE  OF  WHICH SHALL BE
          REASONABLY  ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED
          IN  CONNECTION  WITH  A  BONA  FIDE  MARGIN  ACCOUNT WITH A REGISTERED
          BROKER-DEALER  OR  OTHER  LOAN WITH A FINANCIAL INSTITUTION THAT IS AN
          "ACCREDITED  INVESTOR"  AS DEFINED IN RULE 501(a) UNDER THE SECURITIES
          ACT.

          The  Company acknowledges and agrees that a Purchaser may from time to
     time  pledge  pursuant  to  a  bona fide margin agreement with a registered
     broker-dealer or grant a security interest in some or all of the Securities
     to  a  financial institution that is an "accredited investor" as defined in
     Rule  501(a)  under  the  Securities  Act and who agrees to be bound by the
     provisions  of this Agreement and the Registration Rights Agreement and, if
     required  under  the terms of such arrangement, such Purchaser may transfer
     pledged  or  secured  Securities  to  the  pledgees  or  secured

<PAGE>
     parties.  Such a pledge or transfer would not be subject to approval of the
     Company and no legal opinion of legal counsel of the pledgee, secured party
     or  pledgor  shall  be required in connection therewith. Further, no notice
     shall  be  required of such pledge. At the appropriate Purchaser's expense,
     the  Company  will  execute  and deliver such reasonable documentation as a
     pledgee or secured party of Securities may reasonably request in connection
     with  a  pledge or transfer of the Securities, including, if the Securities
     are  subject to registration pursuant to the Registration Rights Agreement,
     the preparation and filing of any required prospectus supplement under Rule
     424(b)(3)  under  the  Securities  Act or other applicable provision of the
     Securities  Act  to  appropriately  amend  the list of Selling Stockholders
     thereunder.

          (c)  Certificates  evidencing  the Shares and Warrant Shares shall not
     contain  any legend (including the legend set forth in Section 4.1(b)), (i)
     while  a  registration  statement  (including  the  Registration Statement)
     covering the resale of such security is effective under the Securities Act,
     or  (ii)  following  any  sale of such Shares or Warrant Shares pursuant to
     Rule  144,  or (iii) if such Shares or Warrant Shares are eligible for sale
     under  Rule 144(k), or (iv) if such legend is not required under applicable
     requirements  of the Securities Act (including judicial interpretations and
     pronouncements  issued  by  the Staff of the Commission). The Company shall
     cause  its counsel to issue a legal opinion to the Company's transfer agent
     promptly  after  the  Effective  Date if required by the Company's transfer
     agent  to effect the removal of the legend hereunder. If all or any portion
     of a Warrant is exercised at a time when there is an effective registration
     statement  to  cover  the resale of the Warrant Shares, such Warrant Shares
     shall  be issued free of all legends. The Company agrees that following the
     Effective  Date  or at such time as such legend is no longer required under
     this Section 4.1(c), it will, no later than five Trading Days following the
     delivery by a Purchaser to the Company or the Company's transfer agent of a
     certificate  representing  Shares  or  Warrant  Shares, as the case may be,
     issued  with  a  restrictive legend (such date, the "Legend Removal Date"),
                                                          -------------------
     deliver  or  cause  to  be  delivered  to  such  Purchaser  a  certificate
     representing  such  Securities  that is free from all restrictive and other
     legends.  The  Company  may  not  make  any notation on its records or give
     instructions  to  any  transfer  agent  of  the  Company  that  enlarge the
     restrictions  on  transfer  set  forth  in  this  Section.

          (d)  In  addition  to  such  Purchaser's other available remedies, the
     Company shall pay to a Purchaser, in cash, as liquidated damages and not as
     a  penalty,  for  each  $1,000  of  Shares  or Warrant Shares (based on the
     Closing Price of the Common Stock on the date such Securities are submitted
     to the Company's transfer agent) subject to Section 4.1(c), $10 per Trading
     Day  (increasing  to  $20  per Trading Day five (5) Trading Days after such
     damages have begun to accrue) for each Trading Day after the Legend Removal
     Date  until  such certificate is delivered. Nothing herein shall limit such
     Purchaser's  right  to  pursue  actual damages for the Company's failure to
     deliver  certificates  representing  any  Securities  as  required  by  the
     Transaction  Documents,  and  such Purchaser shall have the right to pursue
     all  remedies  available  to  it  at  law  or  in equity including, without
     limitation,  a  decree  of  specific  performance and/or injunctive relief.

          (e)  Each  Purchaser,  severally  and  not  jointly  with  the  other
     Purchasers,  agrees  that  the  removal  of  the  restrictive  legend  from
     certificates  representing  Securities  as set forth in this Section 4.1 is
     predicated  upon  the  Company's  reliance that the Purchaser will sell any
     Securities  pursuant  to  either  the  registration  requirements  of  the
     Securities  Act, including any applicable prospectus delivery requirements,
     or  an  exemption  therefrom,  and  each  Purchaser  agrees  to deliver the
     documents  set  forth  in  Schedule  4.1(e)  evidencing  such  compliance.

          (f)  Until  the  date  that  each Purchaser holds less than 20% of the
     Shares  initially  purchased  hereunder by such Purchaser or two years from
     the  Effective  Date, the Company shall not undertake a reverse stock split
     or  reclassification  of the Common Stock without the prior written consent
     of  the  Purchasers  holding  a  majority  in  interest  of  the  Shares.

     4.2  Furnishing  of Information.  As long as any Purchaser owns Securities,
          --------------------------
the  Company  covenants  to timely file (or obtain extensions in respect thereof
and  file  within  the  applicable  grace  period)

<PAGE>
all  reports  required to be filed by the Company after the date hereof pursuant
to  the  Exchange Act.  As long as any Purchaser owns Securities, if the Company
is  not  required  to file reports pursuant to the Exchange Act, it will prepare
and  furnish  to  the  Purchasers and make publicly available in accordance with
Rule  144(c)  such  information  as  is  required for the Purchasers to sell the
Securities  under Rule 144. The Company further covenants that it will take such
further  action  as  any holder of Securities may reasonably request, all to the
extent  required from time to time to enable such Person to sell such Securities
without  registration  under  the  Securities  Act  within the limitation of the
exemptions  provided  by  Rule  144.

     4.3  Integration.  The  Company  shall  not sell, offer for sale or solicit
          -----------
offers  to  buy or otherwise negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of  the  Securities  in  a  manner that would require the registration under the
Securities  Act of the sale of the Securities to the Purchasers or that would be
integrated  with  the  offer or sale of the Securities for purposes of the rules
and  regulations  of  any  Trading Market such that it would require shareholder
approval  prior  to  the  closing  of  such other transaction unless shareholder
approval is obtained before the closing of such subsequent transaction.

     4.4  Securities  Laws  Disclosure;  Publicity.  The  Company shall, by 8:30
          ----------------------------------------
a.m.  Eastern  time on the Trading Day following the Closing Date, issue a press
release or file a Current Report on Form 8-K, in each case reasonably acceptable
to each Purchaser disclosing the material terms of the transactions contemplated
hereby.  The Company and each Purchaser shall consult with each other in issuing
any  press  releases  with  respect to the transactions contemplated hereby, and
neither  the  Company  nor  any  Purchaser shall issue any such press release or
otherwise  make  any  such  public  statement  without  the prior consent of the
Company,  with  respect  to  any  press release of any Purchaser, or without the
prior  consent  of  each  Purchaser,  with  respect  to any press release of the
Company,  which  consent  shall  not  unreasonably  be  withheld, except if such
disclosure is required by law, in which case the disclosing party shall promptly
provide  the  other  party  with  prior  notice  of  such  public  statement  or
communication.  Notwithstanding  the  foregoing,  the Company shall not publicly
disclose  the name of any Purchaser, or include the name of any Purchaser in any
filing  with  the Commission or any regulatory agency or Trading Market, without
the  prior  written consent of such Purchaser, except (i) as required by federal
securities law in connection with the registration statement contemplated by the
Registration Rights Agreement and (ii) to the extent such disclosure is required
by  law  or  Trading Market regulations, in which case the Company shall provide
the  Purchasers  with  prior notice of such disclosure permitted under subclause
(i)  or  (ii).

     4.5  Shareholders  Rights  Plan.  No  claim will be made or enforced by the
          --------------------------
Company or, to the knowledge of the Company, any other Person that any Purchaser
is  an  "Acquiring Person" under any shareholders rights plan or similar plan or
arrangement in effect or hereafter adopted by the Company, or that any Purchaser
could  be  deemed  to trigger the provisions of any such plan or arrangement, by
virtue  of  receiving  Securities  under  the Transaction Documents or under any
other  agreement  between  the  Company  and  the  Purchasers. The Company shall
conduct  its  business  in  a  manner  so that it will not become subject to the
Investment  Company  Act.

     4.6  Non-Public Information.  The Company covenants and agrees that neither
          ----------------------
it  nor  any other Person acting on its behalf will provide any Purchaser or its
agents  or  counsel  with  any information that the Company believes constitutes
material  non-public information, unless prior thereto such Purchaser shall have
executed  a  written  agreement  regarding  the  confidentiality and use of such
information.  The  Company understands and confirms that each Purchaser shall be
relying on the foregoing representations in effecting transactions in securities
of  the  Company.

     4.7  Use of Proceeds.  Except as set forth on Schedule 4.7 attached hereto,
          ---------------
the Company shall use the net proceeds from the sale of the Securities hereunder
for  working  capital purposes (including, without limitation, payment of broker
or  finders'  fees  in connection with the transactions contemplated hereby) and
not  for  the  satisfaction  of  any  portion  of the Company's debt (other than
payment  of  trade payables in the ordinary course of the Company's business and
prior  practices),  to redeem any Company equity or equity-equivalent securities
or  to  settle  any  outstanding  litigation.

<PAGE>
     4.8  Reimbursement.  If  any  Purchaser becomes involved in any capacity in
          -------------
any  Proceeding  by  or  against  any Person who is a stockholder of the Company
(except  as a result of sales, pledges, margin sales and similar transactions by
such  Purchaser  to or with any current stockholder), solely as a result of such
Purchaser's acquisition of the Securities under this Agreement, the Company will
reimburse  such Purchaser for its reasonable legal and other expenses (including
the  cost  of  any investigation preparation and travel in connection therewith)
incurred  in  connection  therewith,  as  such  expenses  are  incurred.  The
reimbursement  obligations  of  the  Company  under  this  paragraph shall be in
addition  to  any  liability  which the Company may otherwise have, shall extend
upon  the  same terms and conditions to any Affiliates of the Purchasers who are
actually  named  in  such  action,  proceeding  or  investigation, and partners,
directors,  agents,  employees and controlling persons (if any), as the case may
be,  of  the  Purchasers  and  any such Affiliate, and shall be binding upon and
inure  to  the  benefit  of  any  successors,  assigns,  heirs  and  personal
representatives  of  the  Company, the Purchasers and any such Affiliate and any
such  Person.  The  Company also agrees that neither the Purchasers nor any such
Affiliates,  partners, directors, agents, employees or controlling persons shall
have any liability to the Company or any Person asserting claims on behalf of or
in  right  of  the  Company solely as a result of acquiring the Securities under
this  Agreement.

     4.9  Indemnification  of  Purchasers.   The Company will indemnify and hold
          -------------------------------
the  Purchasers and their directors, officers, shareholders, partners, employees
and  agents  (each,  a  "Purchaser  Party")  harmless  from  any and all losses,
liabilities,  obligations,  claims,  contingencies, damages, costs and expenses,
including all judgments, amounts paid in settlements, court costs and reasonable
attorneys'  fees  and  costs  of investigation that any such Purchaser Party may
suffer or incur as a result of or relating to: (a) any misrepresentation, breach
or  inaccuracy,  or  any  allegation  by  a  third  party  that,  if true, would
constitute  a  breach  or inaccuracy, of any of the representations, warranties,
covenants  or  agreements  made by the Company in this Agreement or in the other
Transaction Documents; or (b) any cause of action, suit or claim brought or made
against  such Purchaser Party and arising solely out of or solely resulting from
the  execution, delivery, performance or enforcement of this Agreement or any of
the  other  Transaction  Documents, other than directly resulting from the gross
negligence  or  willful misconduct of the Purchasers. The Company will reimburse
such  Purchaser  for its reasonable legal and other expenses (including the cost
of  any  investigation, preparation and travel in connection therewith) incurred
in  connection  therewith,  as  such  expenses  are  incurred.

     4.10 Listing  of  Common  Stock.  The  Company  hereby  agrees  to  use
          --------------------------
commercially reasonable efforts to maintain the listing of the Common Stock on a
Trading Market, and as soon as reasonably practicable following the Closing (but
not  later  than  the earlier of the Effective Date and the first anniversary of
the  Closing  Date) to list all of the Shares and Warrant Shares on such Trading
Market.  The  Company  further agrees, if the Company applies to have the Common
Stock  traded  on  any other Trading Market, it will include in such application
all  of  the  Shares  and  Warrant Shares, and will take such other action as is
necessary  to  cause  all  of the Shares and Warrant Shares to be listed on such
other  Trading Market as promptly as possible.  The Company will take all action
reasonably  necessary to continue the listing and trading of its Common Stock on
a  Trading  Market and will comply in all respects with the Company's reporting,
filing  and  other  obligations under the bylaws or rules of the Trading Market.

     4.11 Equal  Treatment of Purchasers.  No  consideration shall be offered or
          ------------------------------
paid  to  any  person  to  amend  or  consent to a waiver or modification of any
provision  of  any of the Transaction Documents unless the same consideration is
also  offered  to  all  of  the  parties  to  the  Transaction  Documents.  For
clarification  purposes,  this provision constitutes a separate right granted to
each  Purchaser  by the Company and negotiated separately by each Purchaser, and
is  intended to treat for the Company the Purchasers as a class and shall not in
any  way  be  construed  as  the Purchasers acting in concert or as a group with
respect  to  the  purchase,  disposition  or  voting of Securities or otherwise.

     4.12 Participation  in  Future  Financing.  From  the  date hereof until 12
          ------------------------------------
months after the Effective Date, the Company shall not effect a financing of its
Common  Stock  or Common Stock Equivalents (a "Subsequent Financing") unless (i)
                                               --------------------
the  Company  delivers  to  each  of such Purchasers a written notice at least 5
Trading  Days prior to the closing of such Subsequent Financing (the "Subsequent
                                                                      ----------

<PAGE>
Financing  Notice")  of its intention to effect such Subsequent Financing, which
-----------------
Subsequent  Financing  Notice  shall  describe in reasonable detail the proposed
terms of such Subsequent Financing, the amount of proceeds intended to be raised
thereunder,  the  Person  with  whom such Subsequent Financing is proposed to be
effected,  and  attached  to  which  shall  be  a term sheet or similar document
relating  thereto and (ii) such Purchaser shall not have notified the Company by
6:30  p.m. (New York City time) on the fifth (5th) Trading Day after its receipt
of  the  Subsequent  Financing Notice of its willingness to provide (or to cause
its  designee  to  provide),  subject  to  completion  of  mutually  acceptable
documentation,  all  or  part of such financing to the Company on the same terms
set  forth  in  the Subsequent Financing Notice. If one or more Purchasers shall
fail  to  so  notify  the  Company  of  their  willingness to participate in the
Subsequent  Financing,  the  Company  may  effect  the remaining portion of such
Subsequent Financing on the terms and to the Persons set forth in the Subsequent
Financing  Notice;  provided that the Company must provide the Purchasers with a
second Subsequent Financing Notice, and the Purchasers will again have the right
of  first  refusal  set  forth  above  in  this  Section 4.12, if the Subsequent
Financing  subject to the initial Subsequent Financing Notice is not consummated
for any reason on the terms set forth in such Subsequent Financing Notice within
60  Trading  Days after the date of the initial Subsequent Financing Notice with
the  Person  identified  in  the  Subsequent Financing Notice.  In the event the
Company  receives  responses  to  Subsequent  Financing  Notices from Purchasers
seeking  to  purchase  more  than  the  financing  sought  by the Company in the
Subsequent  Financing such Purchasers shall have the right to purchase their Pro
Rata  Portion (as defined below) of the Common Stock or Common Stock Equivalents
to  be  issued in such Subsequent Financing.  "Pro Rata Portion" is the ratio of
                                               ----------------
(x) such Purchaser's Subscription Amount and (y) the aggregate sum of all of the
Subscription  Amounts.  Notwithstanding  the  foregoing, this Section 4.12 shall
not apply in respect of the issuance of (a) shares of Common Stock or options to
employees,  consultants,  officers  or  directors of the Company pursuant to any
stock  or  option plan duly adopted by a majority of the non-employee members of
the  Board  of  Directors  of  the  Company  or  a  majority of the members of a
committee  of  non-employee  directors  established  for  such  purpose  or  (b)
securities  upon  the  exercise  of or conversion of any convertible securities,
options  or  warrants  issued  and  outstanding  on  the date of this Agreement,
provided  that  such  securities  have  not  been amended since the date of this
Agreement.

     4.13 Subsequent Equity Sales.  From the date hereof until 90 days after the
          -----------------------
Effective  Date,  neither  the  Company nor any Subsidiary shall issue shares of
Common  Stock  or Common Stock Equivalents; provided, however, the 90 day period
                                            --------  -------
set  forth in this Section 4.14 shall be extended for the number of Trading Days
during  such period in which (y) trading in the Common Stock is suspended by any
Trading  Market, or (z) following the Effective Date, the Registration Statement
is  not  effective  or the prospectus included in the Registration Statement may
not  be  used by the Purchasers for the resale of the Shares and Warrant Shares.
Notwithstanding  the  foregoing, this Section 4.14 shall not apply in respect of
the issuance of (a) shares of Common Stock or options to employees, consultants,
officers  or  directors of the Company pursuant to any stock or option plan duly
adopted  by  a majority of the non-employee members of the Board of Directors of
the  Company  or  a  majority  of  the  members  of  a committee of non-employee
directors established for such purpose or (b) securities upon the exercise of or
conversion  of  any  convertible  securities,  options  or  warrants  issued and
outstanding  on  the  date of this Agreement, provided that such securities have
not  been  amended  since  the  date  of  this  Agreement.

                                   ARTICLE V.
                                  MISCELLANEOUS

     5.1  Fees and Expenses.  Each party shall pay the fees and expenses of its
          -----------------
advisers, counsel, accountants and other experts, if any, and all other expenses
incurred  by  such  party  incident  to the negotiation, preparation, execution,
delivery and performance of this Agreement.  The Company shall pay all stamp and
other taxes and duties levied in connection with the sale of the Securities.

     5.2  Entire  Agreement.  The  Transaction  Documents,  together  with  the
          -----------------
exhibits  and schedules thereto, contain the entire understanding of the parties
with respect to the subject matter hereof and supersede all prior agreements and
understandings, oral or written, with respect to such matters, which the parties
acknowledge have been merged into such documents, exhibits and schedules.

<PAGE>
     5.3  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 at the facsimile number
set  forth  on  the signature pages attached hereto 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 set forth on the signature pages attached hereto 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 second 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 set forth on the signature pages attached
hereto.

     5.3  Amendments;  Waivers.  No provision of this Agreement may be waived or
          --------------------
amended  except  in a written instrument signed, in the case of an amendment, by
the Company and each Purchaser or, in the case of a waiver, by the party against
whom  enforcement  of  any such waiver is sought.  No waiver of any default with
respect  to  any  provision, condition or requirement of this Agreement shall be
deemed  to  be  a  continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall  any  delay or omission of either party to exercise any right hereunder in
any  manner  impair  the  exercise  of  any  such  right.

     5.4  Construction.  The  headings  herein  are for convenience only, do not
          ------------
constitute  a  part of this Agreement and shall not be deemed to limit or affect
any  of  the  provisions  hereof.  The  language  used in this Agreement will be
deemed  to be the language chosen by the parties to express their mutual intent,
and no rules of strict construction will be applied against any party.

     5.6  Successors  and  Assigns.  This  Agreement  shall  be binding upon and
          ------------------------
inure  to the benefit of the parties and their successors and permitted assigns.
The Company may not assign this Agreement or any rights or obligations hereunder
without  the  prior written consent of each Purchaser.  Any Purchaser may assign
any  or  all  of  its  rights  under  this  Agreement to any Person to whom such
Purchaser  assigns  or transfers any Securities, provided such transferee agrees
in  writing  to  be  bound,  with  respect to the transferred Securities, by the
provisions  hereof  that  apply  to  the  "Purchasers".

     5.7  No Third-Party Beneficiaries.  This  Agreement  is  intended  for  the
          ----------------------------
benefit  of  the  parties  hereto  and their respective successors and permitted
assigns  and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person, except as otherwise set forth in Section 4.8.

     5.8  Governing Law.  All questions concerning the construction, validity,
          -------------
enforcement and interpretation of the Transaction Documents 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 legal proceedings concerning the interpretations,
enforcement and defense of the transactions contemplated by this Agreement and
any other Transaction Documents (whether brought against a party hereto or its
respective affiliates, directors, officers, shareholders, employees or agents)
shall be commenced exclusively in the state and federal courts sitting in the
City of New York.  Each party hereto hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts sitting in the City of New York,
New York for the adjudication of any dispute hereunder or in connection herewith
or with any transaction contemplated hereby or discussed herein (including with
respect to the enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any suit, action or proceeding,
any claim that it is not personally subject to the jurisdiction of any such
court, that such suit, action or proceeding is improper.  Each party hereto
hereby irrevocably waives personal service of process and consents to process
being served in any such suit, action or proceeding by delivering a copy thereof
via 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 (including its
affiliates, agents, officers, directors and employees) hereby irrevocably
waives, to the fullest extent permitted by applicable law, any and all right to
trial by jury in any legal proceeding arising out of or relating to this
Agreement or

<PAGE>
the transactions contemplated hereby. If either party shall commence an action
or proceeding to enforce any provisions of a Transaction Document, then the
prevailing party in such action or proceeding shall be reimbursed by the other
party for its attorneys' fees and other costs and expenses incurred with the
investigation, preparation and prosecution of such action or proceeding.

     5.9  Survival.  The representations and warranties herein shall survive the
          --------
Closing and delivery of the Shares and Warrant Shares.

     5.10 Execution.  This  Agreement  may  be  executed  in  two  or  more
          ---------
counterparts,  all  of which when taken together shall be considered one and the
same  agreement and shall become effective when counterparts have been signed by
each  party  and  delivered  to  the  other party, it being understood that both
parties  need not sign the same counterpart.  In the event that any signature is
delivered  by  facsimile  transmission,  such signature shall create a valid and
binding  obligation of the party executing (or on whose behalf such signature is
executed)  with  the  same  force and effect as if such facsimile signature page
were  an  original  thereof.

     5.11 Severability.  If  any  provision  of  this  Agreement  is  held to be
          ------------
invalid  or unenforceable in any respect, the validity and enforceability of the
remaining  terms  and  provisions  of  this  Agreement  shall  not in any way be
affected  or impaired thereby and the parties will attempt to agree upon a valid
and  enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.

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

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

     5.14 Payment Set Aside.  To  the extent that the Company makes a payment or
          -----------------
payments  to  any  Purchaser pursuant to any Transaction Document or a Purchaser
enforces or exercises its rights thereunder, and such payment or payments or the
proceeds  of  such  enforcement or exercise or any part thereof are subsequently
invalidated,  declared  to  be  fraudulent or preferential, set aside, recovered
from,  disgorged by or are required to be refunded, repaid or otherwise restored
to  the  Company,  a  trustee,  receiver  or  any  other  person  under  any law
(including, without limitation, any bankruptcy law, state or federal law, common
law  or  equitable  cause of action), then to the extent of any such restoration
the  obligation  or  part  thereof  originally intended to be satisfied shall be
revived  and  continued in full force and effect as if such payment had not been
made  or  such  enforcement  or  setoff  had  not  occurred.

     5.15 Independent  Nature  of  Purchasers'  Obligations  and  Rights.  The
          --------------------------------------------------------------
obligations of each Purchaser under any Transaction Document are several and not
joint  with  the  obligations  of any other Purchaser, and no Purchaser shall be
responsible  in  any  way  for  the  performance of the obligations of any other
Purchaser  under  any  Transaction Document.  Nothing contained herein or in any
Transaction  Document,  and  no  action taken by any Purchaser pursuant thereto,
shall be deemed to constitute the Purchasers as a partnership, an association, a
joint  venture  or  any  other  kind of entity, or create a presumption that the
Purchasers  are  in any way acting in concert or as a group with respect to such
obligations  or the transactions contemplated by the Transaction Document.  Each
Purchaser  shall  be

<PAGE>
entitled  to  independently  protect  and  enforce its rights, including without
limitation,  the  rights  arising  out  of  this  Agreement  or out of the other
Transaction  Documents, and it shall not be necessary for any other Purchaser to
be  joined  as  an  additional  party  in any proceeding for such purpose.  Each
Purchaser has been represented by its own separate legal counsel in their review
and  negotiation  of  the  Transaction Documents.  For reasons of administrative
convenience  only,  Purchasers  and  their  respective  counsel  have  chosen to
communicate  with  the  Company  through  FW.  FW  does not represent all of the
Purchasers  but  only  Ram Capital Resources. The Company has elected to provide
all Purchasers with the same terms and Transaction Documents for the convenience
of  the  Company  and  not  because it was required or requested to do so by the
Purchasers.

                            (Signature Page Follows)

<PAGE>
          IN  WITNESS  WHEREOF,  the  parties hereto have caused this Securities
Purchase  Agreement  to  be  duly  executed  by  their  respective  authorized
signatories  as  of  the  date  first  indicated  above.

ELINEAR, INC.                                        Address for Notice:
                                                     -------------------

By:__________________________________________
   Name:
   Title:

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

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                     SIGNATURE PAGES FOR PURCHASERS FOLLOW]

<PAGE>
     IN  WITNESS  WHEREOF,  the undersigned have caused this Securities Purchase
Agreement  to  be duly executed by their respective authorized signatories as of
the  date  first  indicated  above.

PURCHASER NAME:                                           Address for Notice:
                                                          -------------------

By:____________________________________
     Name:
     Title:                                                    Attn:

Subscription Amount:  $
Shares:
Warrant Shares:

Tax ID Number:

Broker-Dealer affiliations if any:______________________

________________________________________________________

<PAGE>
                 PURCHASER'S SIGNATURE PAGE TO ELIN SPA (CONT. . .)

PURCHASER NAME:                                           Address for Notice:
                                                          -------------------

By: ____________________________________
     Name:
     Title:                                                    Attn:

Subscription Amount:  $
Shares:
Warrant Shares:

Tax ID Number:

Broker-Dealer affiliations if any:______________________

________________________________________________________

<PAGE>

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