Document:

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EXHIBIT 10.52

                     AMENDED AND RESTATED SECURITY AGREEMENT

                  This AMENDED AND RESTATED SECURITY AGREEMENT (this
"AGREEMENT"), dated as of January 14, 2005, by and among VisiJet, Inc., a
Delaware corporation ("COMPANY"), each of the parties listed on EXHIBIT A hereto
and their respective endorsees, transferees and assigns (individually, a
"SECURED PARTY", and collectively, the "SECURED PARTIES"), and Renn Capital
Group, Inc., a Texas corporation (the "AGENT"), as agent for the Secured
Parties.

                                   WITNESSETH:

         WHEREAS, pursuant to a Securities Purchase Agreement, dated October 6,
2004, between the Company and certain of the Secured Parties, and a Securities
Purchase Amendment Agreement, dated October 6, 2004, between such parties, the
Company issued to such Secured Parties certain notes and debentures
(collectively, the "PREVIOUS DEBENTURES") which may be converted into shares of
common stock of the Company ("COMMON STOCK") and certain warrants ("PREVIOUS
WARRANTS") to purchase Common Stock; and

         WHEREAS, pursuant to a Securities Purchase Agreement, dated the date
hereof, between the Company and the Secured Parties (the "NEW PURCHASE
AGREEMENT"), the Company has agreed to issue to the Secured Parties certain
debentures (the "DEBENTURES") which may be converted into shares of Common Stock
and certain warrants (the "WARRANTS") to purchase Common Stock; and

         WHEREAS, pursuant to New Purchase Agreement, the Previous Debentures
will be exchanged for Debentures, and the Previous Warrants will be exchanged
for Warrants; and

         WHEREAS, in order to induce certain of the Secured Parties to purchase
the Previous Debentures and the Previous Warrants, the Company agreed to execute
and deliver a Security Agreement, dated as of October 6, 2004 (the "PRIOR
AGREEMENT") for the benefit of such Secured Parties and to grant to them a
security interest in certain property of the Company to secure the prompt
payment, performance and discharge in full of all of Company's obligations under
the Previous Debentures and the Previous Warrants,; and

         WHEREAS, pursuant to Section 15(c) of the Prior Agreement, the
undersigned, constituting all of the parties that executed the Prior Agreement,
desire to amend and restate the Prior Agreement in its entirety as set forth
herein;

         NOW, THEREFORE, in consideration of the agreements herein contained and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, the parties hereto hereby amend and restate the Prior
Agreement to read in its entirety as follows:

         1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings set forth in this Section 1. Terms used but not
otherwise defined in this Agreement that are defined in Article 9 of the UCC
(such as "general intangibles" and "proceeds") shall have the respective
meanings given such terms in Article 9 of the UCC.

                  (a) "COLLATERAL" means the collateral in which the Secured
Parties are granted a security interest by this Agreement and which shall
include the following, whether presently owned or existing or hereafter acquired
or coming into existence, and all additions and accessions thereto and all
substitutions and replacements thereof, and all proceeds, products and accounts

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thereof, including, without limitation, all proceeds from the sale or transfer
of the Collateral and of insurance covering the same and of any tort claims in
connection therewith:

                           (i) All goods of the Company, including, without
                  limitations, all machinery, equipment, computers, motor
                  vehicles, trucks, tanks, boats, ships, appliances, furniture,
                  special and general tools, fixtures, test and quality control
                  devices and other equipment of every kind and nature and
                  wherever situated, together with all documents of title and
                  documents representing the same, all additions and accessions
                  thereto, replacements therefor, all parts therefor, and all
                  substitutes for any of the foregoing and all other items used
                  and useful in connection with the Company's businesses and all
                  improvements thereto (collectively, the "EQUIPMENT"); and

                           (ii) All inventory of the Company; and

                           (iii) All of the Company's contract rights and
                  general intangibles, including, without limitation, all
                  partnership interests, stock or other securities, licenses,
                  distribution and other agreements, computer software
                  development rights, leases, franchises, customer lists,
                  quality control procedures, grants and rights, goodwill,
                  trademarks, service marks, trade styles, trade names, patents,
                  patent applications, copyrights, deposit accounts, and income
                  tax refunds (collectively, the "GENERAL INTANGIBLES"); and

                           (iv) All receivables of the Company including all
                  insurance proceeds, and rights to refunds or indemnification
                  whatsoever owing, together with all instruments, all documents
                  of title representing any of the foregoing, all rights in any
                  merchandising, goods, equipment, motor vehicles and trucks
                  which any of the same may represent, and all right, title,
                  security and guaranties with respect to each receivable,
                  including any right of stoppage in transit; and

                           (v) All of the Company's documents, instruments and
                  chattel paper, files, records, books of account, business
                  papers, computer programs and the products and proceeds of all
                  of the foregoing Collateral set forth in clauses (i)-(iv)
                  above.

                  (b) "OBLIGATIONS" means all of the Company's obligations under
this Agreement and the Debentures, in each case, whether now or hereafter
existing, voluntary or involuntary, direct or indirect, absolute or contingent,
liquidated or unliquidated, whether or not jointly owed with others, and whether
or not from time to time decreased or extinguished and later decreased, created
or incurred, and all or any portion of such obligations or liabilities that are
paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from the Secured Parties as a preference, fraudulent
transfer or otherwise as such obligations may be amended, supplemented,
converted, extended or modified from time to time.

                  (c) "UCC" means the Uniform Commercial Code, as currently in
effect in the State of Texas.

         2. GRANT OF SECURITY INTEREST. As an inducement for the Secured Parties
to purchase the Debentures and to secure the complete and timely payment,
performance and discharge in full, as the case may be, of all of the
Obligations, the Company hereby, unconditionally and irrevocably, pledges,
grants and hypothecates to the Secured Parties, a continuing security interest
in, a continuing lien upon, an unqualified right to possession and disposition
of and a right of set-off against, in each case to the fullest extent permitted
by law, all of the Company's right, title and interest of whatsoever kind and
nature in and to the Collateral (the "SECURITY Interest").

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         3. REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF THE
COMPANY. Except as set forth on Schedule A attached hereto, the Company
represents and warrants to, and covenants and agrees with, the Secured Parties
as follows:

                  (a) The Company has the requisite corporate power and
authority to enter into this Agreement and otherwise to carry out its
obligations thereunder. The execution, delivery and performance by the Company
of this Agreement and the filings contemplated therein have been duly authorized
by all necessary action on the part of the Company and no further action is
required by the Company. This Agreement constitutes a legal, valid and binding
obligation of the Company enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditor's rights
generally.

                  (b) The Company represents and warrants that it has no place
of business or offices where its respective books of account and records are
kept (other than temporarily at the offices of its attorneys or accountants) or
places where Collateral is stored or located, except as set forth on SCHEDULE A
attached hereto;

                  (c) The Company is the sole owner of the Collateral (except
for non-exclusive licenses granted by the Company in the ordinary course of
business), free and clear of any liens, security interests, encumbrances, rights
or claims, except as set forth on SCHEDULE B, and is fully authorized to grant
the Security Interest in and to pledge the Collateral. There is not on file in
any governmental or regulatory authority, agency or recording office an
effective financing statement, security agreement, license or transfer or any
notice of any of the foregoing (other than those that have been filed in favor
of the Secured Parties pursuant to this Agreement) covering or affecting any of
the Collateral. So long as this Agreement shall be in effect, the Company shall
not execute and shall not knowingly permit to be on file in any such office or
agency any such financing statement or other document or instrument (except to
the extent filed or recorded in favor of the Secured Parties pursuant to the
terms of this Agreement).

                  (d) No part of the Collateral has been judged invalid or
unenforceable. No written claim has been received that any Collateral or the
Company's use of any Collateral violates the rights of any third party. There
has been no adverse decision to the Company's claim of ownership rights in or
exclusive rights to use the Collateral in any jurisdiction or to the Company's
right to keep and maintain such Collateral in full force and effect, and there
is no proceeding involving said rights pending or, to the best knowledge of the
Company, threatened before any court, judicial body, administrative or
regulatory agency, arbitrator or other governmental authority.

                  (e) The Company shall at all times maintain its books of
account and records relating to the Collateral at its principal place of
business and its Collateral at the locations set forth on SCHEDULE A attached
hereto and may not relocate such books of account and records or tangible
Collateral unless it delivers to the Secured Parties at least thirty (30) days
prior to such relocation (i) written notice of such relocation and the new
location thereof (which must be within the United States) and (ii) evidence that
appropriate financing statements and other necessary documents have been filed
and recorded and other steps have been taken to perfect the Security Interest to
create in favor of the Secured Parties valid, perfected and continuing first
priority liens in the Collateral.

                  (f) This Agreement creates in favor of the Secured Parties a
valid security interest in the Collateral securing the payment and performance
of the Obligations and, upon making the filings described in the immediately
following sentence, a perfected first priority security interest in such
Collateral. Except for the filing of financing statements on Form-1 under the
UCC with the jurisdictions indicated on SCHEDULE B, attached hereto, no
authorization or approval of or filing with or notice to any governmental
authority or regulatory body is required either (i) for the grant by the Company

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of, or the effectiveness of, the Security Interest granted hereby or for the
execution, delivery and performance of this Agreement by the Company or (ii) for
the perfection of, or exercise by the Secured Parties, or by the Agent on behalf
of the Secured Parties, of their rights and remedies hereunder.

                  (g) On the date of execution of this Agreement, the Company
will deliver to the Agent (on behalf of the Secured Parties) one or more
executed UCC financing statements on Form-1 (or amended UCC financing statements
which shall include the Company's obligations under the Debentures, and shall
include each Secured Party as a "secured party" thereunder) with respect to the
Security Interest for filing with the jurisdictions indicated on SCHEDULE B,
attached hereto and in such other jurisdictions as may be requested by the
Agent. The Company and the Secured Parties agree that as a result of the
exchange of the Previous Debentures for the Debentures, the Previous Debentures
shall not be secured by any security interest on the assets of the Company, and
any previously filed UCC financing statements relating to the Previous
Debentures shall be terminated on the date hereof.

                  (h) The execution, delivery and performance of this Agreement
does not conflict with or cause a breach or default, or an event that with or
without the passage of time or notice, shall constitute a breach or default,
under any agreement to which the Company is a party or by which the Company is
bound. No consent (including, without limitation, from stock holders or
creditors of the Company) is required for the Company to enter into and perform
its obligations hereunder.

                  (i) The Company shall at all times maintain the liens and
Security Interest provided for hereunder as valid and perfected first priority
liens and security interests in the Collateral in favor of the Secured Parties
until this Agreement and the Security Interest hereunder shall terminate
pursuant to Section 11. The Company hereby agrees to defend the same against any
and all persons. The Company shall safeguard and protect all Collateral for the
account of the Secured Parties. At the request of the Secured Parties, the
Company will sign and deliver to the Secured Parties at any time or from time to
time one or more financing statements pursuant to the UCC (or any other
applicable statute) in form reasonably satisfactory to the Secured Parties and
will pay the cost of filing the same in all public offices wherever filing is,
or is deemed by the Secured Parties to be, necessary or desirable to effect the
rights and obligations provided for herein. Without limiting the generality of
the foregoing, the Company shall pay all fees, taxes and other amounts necessary
to maintain the Collateral and the Security Interest hereunder, and the Company
shall obtain and furnish to the Secured Parties from time to time, upon demand,
such releases and/or subordinations of claims and liens which may be required to
maintain the priority of the Security Interest hereunder.

                  (j) The Company will not transfer, pledge, hypothecate,
encumber, license (except for non-exclusive licenses granted by the Company in
the ordinary course of business), sell or otherwise dispose of any of the
Collateral without the prior written consent of the Secured Parties.

                  (k) The Company shall keep and preserve its Equipment,
Inventory and other tangible Collateral in good condition, repair and order and
shall not operate or locate any such Collateral (or cause to be operated or
located) in any area excluded from insurance coverage.

                  (l) The Company shall, within ten (10) days of obtaining
knowledge thereof, advise the Secured Parties promptly, in sufficient detail, of
any substantial change in the Collateral, and of the occurrence of any event
which would have a material adverse effect on the value of the Collateral or on
the Secured Party's security interest therein.

                  (m) The Company shall promptly execute and deliver to the
Secured Parties such further deeds, mortgages, assignments, security agreements,
financing statements or other instruments, documents, certificates and
assurances and take such further action as the Secured Parties may from time to
time request and may in its sole discretion deem necessary to perfect, protect
or enforce its Security Interest.

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                  (n) The Company shall permit the Secured Parties and its
representatives and agents to inspect the Collateral at any time, and to make
copies of records pertaining to the Collateral as may be requested by the
Secured Parties from time to time.

                  (o) The Company will take all steps reasonably necessary to
diligently pursue and seek to preserve, enforce and collect any rights, claims,
causes of action and accounts receivable in respect of the Collateral.

                  (p) The Company shall promptly notify the Secured Parties in
sufficient detail upon becoming aware of any attachment, garnishment, execution
or other legal process levied against any Collateral and of any other
information received by the Company that may materially affect the value of the
Collateral, the Security Interest or the rights and remedies of the Secured
Parties hereunder.

                  (q) All information heretofore, herein or hereafter supplied
to the Secured Parties by or on behalf of the Company with respect to the
Collateral is accurate and complete in all material respects as of the date
furnished.

                  (r) SCHEDULE A attached hereto contains a list of all of the
subsidiaries of Company.

         4. DEFAULTS. The following events shall be "EVENTS OF DEFAULT":

                  (a) The occurrence of an Event of Default (as defined in the
Debentures) under any of the Debentures;

                  (b) Any representation or warranty of the Company in this
Agreement shall prove to have been incorrect in any material respect when made;

                  (c) The failure by the Company to observe or perform any of
its obligations hereunder for ten (10) days after receipt by the Company of
notice of such failure from the Secured Parties; and

                  (d) Any breach of, or default under, any of the Warrants.

         5. DUTY TO HOLD IN TRUST. Upon the occurrence of any Event of Default
and at any time thereafter, the Company shall, upon receipt by it of any
revenue, income or other sums subject to the Security Interest, whether payable
pursuant to the Debentures or otherwise, or of any check, draft, note, trade
acceptance or other instrument evidencing an obligation to pay any such sum,
hold the same in trust for the Secured Parties and shall forthwith endorse and
transfer any such sums or instruments, or both, to the Secured Parties for
application to the satisfaction of the Obligations.

         6. RIGHTS AND REMEDIES UPON DEFAULT. Each of the Secured Parties hereby
irrevocably appoints Agent to act on its behalf as the Agent hereunder and under
any other document executed in connection herewith, and authorizes the Agent to
take such actions on its behalf and to exercise such powers as are delegated to
the Agent by the terms hereof or thereof, together with such actions and powers
as are reasonably incidental thereto. The provisions of this Paragraph are
solely for the benefit of the Agent and Secured Parties, and the Company shall
not have rights as a third party beneficiary of any of such provisions. The
Agent is authorized to act, in its sole discretion, on behalf of the Secured
Parties as described herein. Upon occurrence of any Event of Default and at any
time thereafter, the Agent (on behalf of the Secured Parties) shall have the

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right to exercise (on behalf of the Secured Parties) all of the remedies
conferred to the Secured Parties hereunder and under the Debentures, and the
Agent (on behalf of the Secured Parties) shall have all the rights and remedies
of a secured party under the UCC and/or any other applicable law (including the
Uniform Commercial Code of any jurisdiction in which any Collateral is then
located). Without limitation, the Agent (on behalf of the Secured Parties)shall
have the following rights and powers:

                  (a) to take possession of the Collateral and, for that
purpose, enter, with the aid and assistance of any person, any premises where
the Collateral, or any part thereof, is or may be placed and remove the same,
and the Company shall assemble the Collateral and make it available to the Agent
at places which the Agent shall reasonably select, whether at the Company's
premises or elsewhere, and make available to the Agent, without rent, all of the
Company's respective premises and facilities for the purpose of the Secured
Parties taking possession of, removing or putting the Collateral in saleable or
disposable form; and

                  (b) to operate the business of the Company using the
Collateral and shall have the right to assign, sell, lease or otherwise dispose
of and deliver all or any part of the Collateral, at public or private sale or
otherwise, either with or without special conditions or stipulations, for cash
or on credit or for future delivery, in such parcel or parcels and at such time
or times and at such place or places, and upon such terms and conditions as the
Agent may deem commercially reasonable, all without (except as shall be required
by applicable statute and cannot be waived) advertisement or demand upon or
notice to the Company or right of redemption of the Company, which are hereby
expressly waived. Upon each such sale, lease, assignment or other transfer of
Collateral, the Agent may, unless prohibited by applicable law which cannot be
waived, purchase all or any part of the Collateral being sold, free from and
discharged of all trusts, claims, right of redemption and equities of the
Company, which are hereby waived and released.

         Neither Agent nor any of its affiliates or representatives will be
liable for any action taken or omitted to be taken by it or them under this
Agreement in good faith and believed by it or them to be within the discretion
or power conferred upon it or them by this Agreement or be responsible for the
consequences of any error of judgment (except for fraud, gross negligence, or
willful misconduct). Unless indemnified to its satisfaction against loss, cost,
liability, and expense, Agent may not be compelled to do any act under this
Agreement or to take any action toward the execution or enforcement of the
powers created under this Agreement or to prosecute or defend any suit in
respect of this Agreement. If Agent requests instructions from Secured Parties
with respect to any act or action in connection with this Agreement, then Agent
is entitled to refrain (without incurring any liability to anyone by so
refraining) from that act or action unless and until it has received
instructions. In no event, however, may Agent or any of its representatives be
required to take any action that it or they determine could incur for it or them
criminal or onerous civil liability. Without limiting the generality of the
foregoing, no Secured Party has any right of action against Agent as a result of
Agent's acting or refraining from acting under this Agreement in accordance with
instructions of the Secured Parties. EACH SECURED PARTY (IN PROPORTION TO THE
THEN-OUTSTANDING PRINCIPAL AMOUNT OF DEBENTURES) AGREES TO INDEMNIFY AGENT AND
ITS REPRESENTATIVES AND HOLD THEM HARMLESS FROM AND AGAINST ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
COSTS, REASONABLE EXPENSES, AND REASONABLE DISBURSEMENTS OF ANY KIND OR NATURE
WHATSOEVER THAT MAY BE IMPOSED ON, ASSERTED AGAINST, OR INCURRED BY THEM IN ANY
WAY RELATING TO OR ARISING OUT OF THIS AGREEMENT OR ANY ACTION TAKEN OR OMITTED
BY THEM UNDER THIS AGREEMENT. ALTHOUGH AGENT AND ITS REPRESENTATIVES HAVE THE
RIGHT TO BE INDEMNIFIED UNDER THIS AGREEMENT FOR ITS OR THEIR OWN ORDINARY
NEGLIGENCE, AGENT AND ITS REPRESENTATIVES DO NOT HAVE THE RIGHT TO BE
INDEMNIFIED UNDER THIS AGREEMENT FOR ITS OR THEIR OWN FRAUD, GROSS NEGLIGENCE,
OR WILLFUL MISCONDUCT.

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         7. APPLICATIONS OF PROCEEDS. The proceeds of any such sale, lease or
other disposition of the Collateral hereunder shall be applied first, to the
expenses of retaking, holding, storing, processing and preparing for sale,
selling, and the like (including, without limitation, any taxes, fees and other
costs incurred in connection therewith) of the Collateral, to the reasonable
attorneys' fees and expenses incurred by the Secured Parties in enforcing its
rights hereunder and in connection with collecting, storing and disposing of the
Collateral, and then to satisfaction of the Obligations, and to the payment of
any other amounts required by applicable law, after which the Secured Parties
shall pay to the Company any surplus proceeds. If, upon the sale, license or
other disposition of the Collateral, the proceeds thereof are insufficient to
pay all amounts to which the Secured Parties are legally entitled, the Company
will be liable for the deficiency, together with interest thereon, at the rate
of twenty (20%) percent per annum (the "DEFAULT RATE"), and the reasonable fees
of any attorneys employed by the Secured Parties to collect such deficiency, and
all such proceeds shall be allocated among the Secured Parties in proportion to
the amount outstanding under the Debentures. To the extent permitted by
applicable law, the Company waives all claims, damages and demands against the
Secured Parties arising out of the repossession, removal, retention or sale of
the Collateral, unless due to the gross negligence or willful misconduct of the
Secured Parties.

         8. COSTS AND EXPENSES. The Company agrees to pay all out-of-pocket
fees, costs and expenses incurred in connection with any filing required
hereunder, including without limitation, any financing statements, continuation
statements, partial releases and/or termination statements related thereto or
any expenses of any searches reasonably required by the Secured Parties. The
Company shall also pay all other claims and charges which in the reasonable
opinion of the Secured Parties might prejudice, imperil or otherwise affect the
Collateral or the Security Interest therein. The Company will also, upon demand,
pay to the Secured Parties the amount of any and all reasonable expenses,
including the reasonable fees and expenses of its their respective counsel and
of any experts and agents, which the Secured Parties may incur in connection
with (i) the enforcement of this Agreement, (ii) the custody or preservation of,
or the sale of, collection from, or other realization upon, any of the
Collateral, or (iii) the exercise or enforcement of any of the rights of the
Secured Parties under the Debentures. Until so paid, any fees payable hereunder
shall be added to the principal amount of the Debentures, as applicable, and
shall bear interest at the Default Rate.

         9. RESPONSIBILITY FOR COLLATERAL. The Company assumes all liabilities
and responsibility in connection with all Collateral, and the obligations of the
Company hereunder or under the Debentures and the Warrants shall in no way be
affected or diminished by reason of the loss, destruction, damage or theft of
any of the Collateral or its unavailability for any reason.

         10. SECURITY INTEREST ABSOLUTE. All rights of the Secured Parties and
all Obligations of the Company hereunder, shall be absolute and unconditional,
irrespective of: (a) any lack of validity or enforceability of this Agreement,
the Debentures, the Warrants, or any agreement entered into in connection with
the foregoing, or any portion hereof or thereof; (b) any change in the time,
manner or place of payment or performance of, or in any other term of, all or
any of the Obligations, or any other amendment or waiver of or any consent to
any departure from the Debentures, the Warrants, or any other agreement entered
into in connection with the foregoing; (c) any exchange, release or
nonperfection of any of the Collateral, or any release or amendment or waiver of
or consent to departure from any other collateral for, or any guaranty, or any
other security, for all or any of the Obligations; (d) any action by the Secured
Parties to obtain, adjust, settle and cancel in its sole discretion any
insurance claims or matters made or arising in connection with the Collateral;
or (e) any other circumstance which might otherwise constitute any legal or
equitable defense available to the Company, or a discharge of all or any part of

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the Security Interest granted hereby. Until the Obligations shall have been paid
and performed in full, the rights of the Secured Parties shall continue even if
the Obligations are barred for any reason, including, without limitation, the
running of the statute of limitations or bankruptcy. The Company expressly
waives presentment, protest, notice of protest, demand, notice of nonpayment and
demand for performance. In the event that at any time any transfer of any
Collateral or any payment received by the Secured Parties hereunder shall be
deemed by final order of a court of competent jurisdiction to have been a
voidable preference or fraudulent conveyance under the bankruptcy or insolvency
laws of the United States, or shall be deemed to be otherwise due to any party
other than the Secured Parties, then, in any such event, the Company's
obligations hereunder shall survive cancellation of this Agreement, and shall
not be discharged or satisfied by any prior payment thereof and/or cancellation
of this Agreement, but shall remain a valid and binding obligation enforceable
in accordance with the terms and provisions hereof. The Company waives all right
to require the Secured Parties to proceed against any other person or to apply
any Collateral which the Secured Parties may hold at any time, or to marshal
assets, or to pursue any other remedy. The Company waives any defense arising by
reason of the application of the statute of limitations to any obligation
secured hereby.

         11. TERM OF AGREEMENT. This Agreement and the Security Interest shall
terminate on the date on which all payments under the Debentures have been made
in full and all other Obligations have been paid or discharged. Upon such
termination, the Secured Parties, at the request and at the expense of the
Company, will join in executing any termination statement with respect to any
financing statement executed and filed pursuant to this Agreement.

         12. POWER OF ATTORNEY; FURTHER ASSURANCES.

                  (a) The Company authorizes the Agent, as agent for the Secured
Parties, and does hereby make, constitute and appoint it, and its respective
officers, agents, successors or assigns with full power of substitution, as the
Company's true and lawful attorney-in-fact, with power, in its own name or in
the name of the Company, to, after the occurrence and during the continuance of
an Event of Default, (i) endorse any notes, checks, drafts, money orders, or
other instruments of payment (including payments payable under or in respect of
any policy of insurance) in respect of the Collateral that may come into
possession of the Agent or any Secured Parties; (ii) to sign and endorse any UCC
financing statement or any invoice, freight or express bill, bill of lading,
storage or warehouse receipts, drafts against debtors, assignments,
verifications and notices in connection with accounts, and other documents
relating to the Collateral; (iii) to pay or discharge taxes, liens, security
interests or other encumbrances at any time levied or placed on or threatened
against the Collateral; (iv) to demand, collect, receipt for, compromise, settle
and sue for monies due in respect of the Collateral; and (v) generally, to do,
at the option of the Agent, and at the Company's expense, at any time, or from
time to time, all acts and things which the Agent deems necessary to protect,
preserve and realize upon the Collateral and the Security Interest granted
therein in order to effect the intent of this Agreement, the Debentures, and the
Warrants, all as fully and effectually as the Company might or could do; and the
Company hereby ratifies all that said attorney shall lawfully do or cause to be
done by virtue hereof. This power of attorney is coupled with an interest and
shall be irrevocable for the term of this Agreement and thereafter as long as
any of the Obligations shall be outstanding.

                  (b) On a continuing basis, the Company will make, execute,
acknowledge, deliver, file and record, as the case may be, in the proper filing
and recording places in any jurisdiction, including, without limitation, the
jurisdictions indicated on SCHEDULE B, attached hereto, all such instruments,
and take all such action as may reasonably be deemed necessary or advisable, or
as reasonably requested by the Agent, to perfect the Security Interest granted
hereunder and otherwise to carry out the intent and purposes of this Agreement,
or for assuring and confirming to the Agent the grant or perfection of a
security interest in all the Collateral.

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                  (c) The Company hereby irrevocably appoints the Agent as the
Company's attorney-in-fact, with full authority in the place and stead of the
Company and in the name of the Company, from time to time in the Agent's
discretion, to take any action and to execute any instrument which the Agent may
deem necessary or advisable to accomplish the purposes of this Agreement,
including the filing, in its sole discretion, of one or more financing or
continuation statements and amendments thereto, relative to any of the
Collateral without the signature of the Company where permitted by law.

         13. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing, with copies to all the other parties hereto, and
shall be deemed to have been duly given (i) if delivered by hand, (ii) upon
receipt of proof of sending thereof if sent by facsimile, (iii) upon receipt if
sent by nationally recognized overnight delivery service (receipt requested),
the next business day, or (iv) if mailed by first-class registered or certified
mail, return receipt requested, postage prepaid, four days after posting in the
U.S. mails, in each case if delivered to the following addresses:

         If to the Company:                 VisiJet, Inc.
                                            192 Technology Drive, Suite Q
                                            Irvine, California 92618
                                            Attention: Laurence M. Schreiber
                                            Telephone: (949) 450-1660
                                            Facsimile: (949) 453-9652

         If to the Agent:                   Renn Capital Group, Inc.
                                            8080 North Central Expressway
                                            Suite 210-LP 59
                                            Dallas, TX 75206
                                            Attention:  Robert C. Pearson
                                            Telephone: (214) 891-8294
                                            Facsimile (214) 891-8291

         With copies to:                    Haynes and Boone, LLP
                                            2505 N. Plano Road, Suite 4000
                                            Richardson, Texas  75082
                                            Attention:  David H. Oden
                                            Telephone: (972) 739-6929
                                            Facsimile: (972) 692-9029

         14. OTHER SECURITY. To the extent that the Obligations are now or
hereafter secured by property other than the Collateral or by the guarantee,
endorsement or property of any other person, firm, corporation or other entity,
then the Agent shall have the right, in its sole discretion, to pursue,
relinquish, subordinate, modify or take any other action with respect thereto,
without in any way modifying or affecting any of the Secured Party's rights and
remedies hereunder.

         15. MISCELLANEOUS.

                  (a) No course of dealing between the Company, the Agent and
any Secured Party, nor any failure to exercise, nor any delay in exercising, on
the part of the Agent or any Secured Party, any right, power or privilege
hereunder or under the Debentures shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, power or privilege hereunder or
thereunder preclude any other or further exercise thereof or the exercise of any
other right, power or privilege.

                                       9
<PAGE>

                  (b) All of the rights and remedies of the Secured Parties with
respect to the Collateral, whether established hereby or by the Debentures or by
any other agreements, instruments or documents or by law shall be cumulative and
may be exercised singly or concurrently.

                  (c) This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and is intended to supersede
all prior negotiations, understandings and agreements with respect thereto,
including the Prior Agreement. Any term of this Agreement may be terminated or
amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance and either retroactively or prospectively)
only with the written consent of the Company and the holders of 75% of the
then-outstanding principal amount of the Debentures. Any termination, amendment
or waiver effected in accordance with this paragraph shall be binding upon each
holder of the Debentures, each future holder of the Debentures, their successors
and assigns, and the Company.

                  (d) In the event that any provision of this Agreement is held
to be invalid, prohibited or unenforceable in any jurisdiction for any reason,
unless such provision is narrowed by judicial construction, this Agreement
shall, as to such jurisdiction, be construed as if such invalid, prohibited or
unenforceable provision had been more narrowly drawn so as not to be invalid,
prohibited or unenforceable. If, notwithstanding the foregoing, any provision of
this Agreement is held to be invalid, prohibited or unenforceable in any
jurisdiction, such provision, as to such jurisdiction, shall be ineffective to
the extent of such invalidity, prohibition or unenforceability without
invalidating the remaining portion of such provision or the other provisions of
this Agreement and without affecting the validity or enforceability of such
provision or the other provisions of this Agreement in any other jurisdiction.

                  (e) No waiver of any breach or default or any right under this
Agreement shall be considered valid unless in writing and signed by the party
giving such waiver, and no such waiver shall be deemed a waiver of any
subsequent breach or default or right, whether of the same or similar nature or
otherwise.

                  (f) This Agreement shall be binding upon and inure to the
benefit of each party hereto and its successors and assigns.

                  (g) Each party shall take such further action and execute and
deliver such further documents as may be necessary or appropriate in order to
carry out the provisions and purposes of this Agreement.

                  (h) This Agreement shall be construed in accordance with the
laws of the State of Texas, except to the extent the validity, perfection or
enforcement of a security interest hereunder in respect of any particular
Collateral which are governed by a jurisdiction other than the State of Texas in
which case such law shall govern. Each of the parties hereto irrevocably submit
to the exclusive jurisdiction of any Texas State or United States Federal court
sitting in Dallas, Texas over any action or proceeding arising out of or
relating to this Agreement, and the parties hereto hereby irrevocably agree that
all claims in respect of such action or proceeding may be heard and determined
in such Texas State or Federal court. The parties hereto agree that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. The parties hereto further waive any objection to venue in the
State of Texas and any objection to an action or proceeding in the State of
Texas on the basis of forum non conveniens.

                  (i) EACH PARTY HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING
OF ANY DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT
MATER OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION CONTRACT CLAIMS, TORT

                                       10
<PAGE>

CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.
EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR
EACH PARTY TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH PARTY HAS RELIED ON
THIS WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH PARTY WILL CONTINUE TO
RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL,
AND THAT SUCH PARTY HAS KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHTS TO A JURY
TRIAL FOLLOWING SUCH CONSULTATION. THIS WAIVER IS IRREVOCABLE, MEANING THAT,
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS AND SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. IN THE EVENT OF
LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.

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

                  (k) The Intellectual Property Security Agreement (as defined
in the Prior Agreement) is hereby terminated and shall be of no further force or
effect.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       11
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed on the day and year first above written.

                                          VISIJET, INC.

                                          By: __________________________________
                                              Name:_____________________________
                                              Title:____________________________

                                          AGENT:

                                          RENN CAPITAL GROUP, INC.

                                          By: __________________________________
                                              Name:_____________________________
                                              Title:____________________________

                                       12
<PAGE>

                                         SECURED PARTY

                                         _______________________________________
                                         [Name of Secured Party]

                                          By: __________________________________
                                          Title:________________________________

           [SIGNATURE PAGE TO AMENDED AND RESTATED SECURITY AGREEMENT]

<PAGE>

                                    EXHIBIT A
                                    ---------

Renaissance Capital Growth & Income Fund III, Inc.
Renaissance US Growth Investment Trust PLC
BFS US Special Opportunities Trust PLC
Roaring Fork Capital SBIC, LP
Republic Aggressive Growth
Little Gem Life Sciences Fund, LLC
Omega Capital
Bushido Capital Master Fund L.P.
Bridges & Pipes LLC
LibertyView Special Opportunities Fund, LP
Little Gem Life Sciences Fund, LLC
Gamma Opportunity Capital Partners, LP
Alpha Capital Aktiengesellschaft
Greenwich Growth Fund Ltd.
Corsair Capital Partners, LP
Corsair Capital Partners Ltd.
Corsair Capital Partners 100 LP

<PAGE>

                                   SCHEDULE A
                                   ----------

Principal Place of Business of the Company:
-------------------------------------------

Visijet, Inc.
192Q Technology Dr.
Irvine Ca. 92618

Locations where collateral is located:
--------------------------------------

Visijet, Inc.
188D Technology Dr.
Irvine, Ca. 92618

Gebauer Medzintechnik GmbH
Monsbachstr 7/1
75242 Neuhausen
Germany

Subsidiaries of the Company
---------------------------

Advanced Refractive Technologies
(Wholly owned inactive Sub)

Exceptions to Representations and Warranties Under Section 3 of the Amended and
-------------------------------------------------------------------------------
Restated Security Agreement
---------------------------

Existing Security Interests:
----------------------------

HIT Credit Union - All assets - See attached executed payoff letter.
Bushido Capital Partners Ltd - All Assets - See attached perfected UCC-1 filing
dated October 7, 2004

Jurisdictions:
--------------

Delaware Corporation
Principal place of business is California
Distribution and Marketing Agreement with Gebauer governed by German Law

<PAGE>

                                   SCHEDULE B
                                   ----------

Existing Security Interests:
----------------------------

HIT Credit Union - All assets - See attached executed payoff letter.
Bushido Capital Partners Ltd - All Assets - See attached perfected UCC-1 filing
dated October 7, 2004

Jurisdictions:
--------------

Delaware Corporation
Principal place of business is California
Distribution and Marketing Agreement with Gebauer governed by German Law<PAGE>

EXHIBIT 10.1

                          REGISTRATION RIGHTS AGREEMENT
                          -----------------------------

         THIS REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT") is made and
entered into as of January 28, 2005, by and among ACACIA RESEARCH CORPORATION, a
Delaware corporation (the "COMPANY"), ACACIA GLOBAL ACQUISITION CORPORATION, a
Delaware corporation, and a wholly owned subsidiary of Company (the
"Purchaser"), and GLOBAL PATENT HOLDINGS, LLC, a Delaware limited liability
company (the "SELLER").

         WHEREAS, the Purchaser and the Seller have entered into a Membership
Interest Purchase Agreement dated as of even date herewith (the "PURCHASE
AGREEMENT") pursuant to which the Purchaser is acquiring all of the outstanding
membership interests of those subsidiaries of the Seller listed on SCHEDULE 1
hereto, each a limited liability company and a wholly owned subsidiary of the
Seller.

         NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, and other good and valuable consideration the sufficiency of
which is hereby acknowledged, the parties hereto further agree as follows:

         1. DEFINITIONS. Each capitalized term used herein and not otherwise
defined shall have the meaning given to such term in the Purchase Agreement. As
used in this Agreement, the following terms shall have the following meanings:

                  "ADJUSTED EVENT DATE" has the meaning set forth in Section
2(b).

                  "ADVICE" has the meaning set forth in Section 5(c).

                  "COMMON STOCK" means Acacia Research-Acacia Technologies
Common Stock, par value $0.001 per share, or any securities exchanged or
substituted for such common stock.

                  "EFFECTIVENESS PERIOD" has the meaning set forth in Section
2(a).

                  "EVENT" has the meaning set forth in Section 2(b).

                  "EVENT DATE" has the meaning set forth in Section 2(b).

                  "FILING DATE" means, with respect to the Registration
Statement required to be filed hereunder, a date that is the later of (i) within
three (3) business days following the Closing; or (ii) within three (3) business
days following the receipt by the Company of all information reasonably
requested (the "REQUESTED INFORMATION") prior to the Closing Date by the Company
for inclusion in the Registration Statement and necessary for the completion of
the Registration Statement.

                  "HOLDER" or "HOLDERS" means the Seller and the shareholders
(the "Selling Shareholders") in whose name the Purchase Shares are issued at
Closing pursuant to Section 1.2(a)(ii) of the Purchase Agreement.

<PAGE>

                  "INDEMNIFIED PARTY" has the meaning set forth in Section 7(c).

                  "INDEMNIFYING PARTY" has the meaning set forth in Section
7(c).

                  "LOSSES" has the meaning set forth in Section 5(a).

                  "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.

                  "REGISTRABLE SECURITIES" means any and all of the Purchase
Shares issuable pursuant to the Purchase Agreement, together with any shares of
Common Stock issued or issuable upon any stock split, dividend or other
distribution, recapitalization or any similar event with respect to the
foregoing, or any securities into which any such securities are converted,
exchanged or substituted in any recapitalization or other capital reorganization
of the Company.

                  "REGISTRATION STATEMENT" means the registration statement
registering the Registrable Securities pursuant to the Securities Act which are
required to be filed hereunder, including (in each case) amendments and
supplements to the registration statement, including pre- and post-effective
amendments, all exhibits thereto , and all material incorporated by reference or
deemed to be incorporated by reference in the registration statement.

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

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

                  "SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder (the "SECURITIES ACT").

         2. REGISTRATION.

                  (a) On or prior to the Filing Date, the Company shall prepare
and file with the Commission the Registration Statement covering the resale of
all of the Registrable Securities for an offering to be made on a continuous
basis pursuant to Rule 415. The Registration Statement required hereunder shall
be on Form S-3 (except if the Company is not then eligible to register for
resale the Registrable Securities on Form S-3, in which event Registration shall
be on another appropriate form available for the sale of the Registrable
Securities by the Holders in accordance herewith). Subject to the terms of this
Agreement, the Company shall use its reasonable best efforts to cause the
Registration Statement to be declared effective under the Securities Act as
promptly as possible after the filing thereof, and to use its reasonable best
efforts to keep the Registration Statement continuously effective under the
Securities Act from the date on which the Commission declares it effective until
the date on which all Registrable Securities covered by the Registration
Statement have been sold or may be sold without volume restrictions pursuant to
Rule 144(k) as determined by counsel to the Company pursuant to a written
opinion letter to such effect, addressed and reasonably acceptable to the
Company's transfer agent and the Holders subject to such restrictions (the
"EFFECTIVENESS PERIOD").

                                       2
<PAGE>

                  (b) If (i) a Registration Statement is not filed on or prior
to the Filing Date, or (ii) the Commission fails to declare such Registration
Statement effective within (A) thirty (30) days following the Closing; or (B)
one hundred (100) days following the Closing under circumstances where the
Commission has notified the Company that the Registration Statement is under
"review" by the Commission with respect to compliance with the Securities Act
(any such failure or breach being referred to as an "EVENT," and for the
purposes of clause (A) or clause (B), the date on which such Event occurs being
referred to as an "EVENT DATE"), then commencing on such Event Date until each
Event is cured by filing (with respect to (i) above) or by a declaration of
effectiveness of such Registration Statement or the expiration of the
Effectiveness Period (with respect to (ii) above), as applicable, the Company
shall pay to Seller the sum of Three Thousand Dollars ($3,000.00) per day, in
cash, as liquidated damages (the "LIQUIDATED DAMAGES") and not as a penalty, for
up to sixty (60) days from the date of such Event (the "LIQUIDATED DAMAGES
PERIOD"), and Seller shall distribute such sum among the Selling Shareholders as
the Seller and the Selling Shareholders may separately agree, it being
understood by all parties hereto that, with respect to the distribution among
the Selling Shareholders, the Company's sole obligation under this Section (b)
is to pay the Liquidated Damages amount directly to Seller, and not to
distribution among the Selling Shareholders. Payment for any such Liquidated
Damages shall be made no later than the first Trading Day of each calendar month
immediately following any date such Liquidated Damages are incurred. If the
Company fails to pay such Liquidated Damages to Seller pursuant to this Section
(b) in full within ten (10) days after the date on which such payment is due,
the Company will pay interest thereon at the rate of ten percent (10%) per annum
to Seller, accruing daily from the dates on which such Liquidated Damages are
due until such amounts, including all interest thereon, are paid in full;
PROVIDED, HOWEVER, that if the Company does not receive from Seller and each of
the Holders the Requested Information (the "REQUEST DATE"), then the applicable
Event Date shall be extended by the number of days beginning on the Request Date
and ending on the day the Company has received all such Requested Information
(the "ADJUSTED EVENT DATE"). Not withstanding anything contained in this
Agreement to the contrary, if the Registration Statement has not been filed
(with respect to (i) above) or declared effective (with respect to (ii) above)
by the last day of the Liquidated Damages Period, then the Company shall
continue to pay the Liquidated Damages to Seller as set forth above until the
Event is cured by such filing or effectiveness, as applicable, in addition to
any other rights to which the Seller and Holders may be entitled under either
this Agreement or applicable law.

                  (c) PLAN OF DISTRIBUTION. Each Selling Shareholder shall be
named as a selling security holder in the Registration Statement and related
Prospectus in such a manner as to permit such Selling Shareholder to deliver
such Prospectus to purchasers of Registrable Securities in accordance with
applicable law under ordinary circumstances. The "PLAN OF DISTRIBUTION" section
of the Registration Statement and Prospectus shall be substantially in the form
of EXHIBIT "A" hereto (to the extent such inclusion is permitted under
applicable Commission regulations and is consistent with comments received from
the Commission during any Commission review of the Registration Statement).

                                       3
<PAGE>

                  (d) BLACKOUT PERIODS. With respect to any registration
statement filed or to be filed pursuant to this Section 2, if the Company shall
determine, in its good faith judgment, that to maintain the effectiveness of
such registration statement (or, if no registration statement has yet been filed
or become effective, to file such a registration statement or cause it to become
effective) would (i) require the public disclosure of material non-public
information concerning any transaction or negotiations involving the Company or
any of its affiliates that would materially interfere with such transaction or
negotiations or (ii) otherwise require premature disclosure of information, in
either case that would be materially disadvantageous (a "DISADVANTAGEOUS
CONDITION"), the Company may, for the shortest period possible, notify the
Selling Shareholders and the Seller that such registration statement is
unavailable for use; provided, that the Company shall not exercise such rights
for a period of more than 45 days from the date of delivery of such notice to
the Seller and the Selling Shareholders, and in any event when aggregated with
any other Disadvantageous Suspension or Regulatory Suspension not more than an
aggregate of 90 days in any 365-day period. If the Company exercises such right,
it will provide written notice thereof to the Seller and the Selling
Shareholders and the Seller, and upon the receipt of any such notice, the
Selling Shareholders shall forthwith discontinue use of the prospectus contained
in such registration statement as provided in this Section 2(d)
("DISADVANTAGEOUS SUSPENSION"), subject to the payment of Liquidated Damages
pursuant to Section (b); provided, that, if at the time of the receipt of such
notice any of the Seller and Selling Shareholder shall have sold Registrable
Securities (or have signed a firm commitment underwriting agreement with respect
to the purchase of such securities) and the Disadvantageous Condition is not of
a nature that would require a post-effective amendment to the Registration
Statement, then the Company shall use its reasonable best efforts to take such
action as will permit such securities to be timely delivered. If any
Disadvantageous Condition shall cease to exist, the Company shall promptly
notify the Selling Shareholders and the Seller to such effect. Liquidated
Damages shall accrue commencing on and including the date of delivery to the
Seller and the Selling Shareholders of the notice of a Disadvantageous
Suspension and shall continue until the date of delivery of the notice of
cessation referenced in the preceding sentence, and payment for any such
Liquidated Damages shall be made no later than the first Trading Day of each
calendar month immediately following any date such Liquidated Damages are
accrued.

         3. REGISTRATION PROCEDURES. In connection with the Company's
registration obligations hereunder, the Company shall:

                  (a) Not less than five (5) Trading Days prior to the filing of
the Registration Statement or any related Prospectus or any amendment or
supplement thereto, the Company shall furnish to Seller copies of all such
documents proposed to be filed (including documents incorporated or deemed
incorporated by reference to the extent requested by Seller). The Company shall
not file the Registration Statement or any such Prospectus or any amendments or
supplements thereto to which Seller shall reasonably object in good faith,
provided that the Company is notified of such objection in writing no later than
three (3) Trading Days after the Seller has been so furnished copies of such
documents; provided further, that if such objection by Seller is based solely on
information provided to the Company by any Holder or Holders, then any
applicable Event Date shall be extended by the number of days which lapse
between the date the Company is notified by Seller of such objection and the
date which the revised or corrected information is delivered to the Company.

                                       4
<PAGE>

                  (b) (i) Prepare and file with the Commission such amendments,
including post-effective amendments, to the Registration Statement and the
Prospectus used in connection therewith as may be necessary to keep the
Registration Statement continuously effective as to the applicable Registrable
Securities during the Effectiveness Period; (ii) cause the related Prospectus to
be amended or supplemented by any required Prospectus supplement, and as so
supplemented or amended to be filed pursuant to Rule 424; (iii) respond as
promptly as reasonably possible to any comments received from the Commission
with respect to the Registration Statement or any amendment thereto and, as
promptly as reasonably possible, upon request, provide the Seller true and
complete copies of all correspondence from and to the Commission relating to the
Registration Statement; and (iv) comply with the provisions of the Securities
Act and the Exchange Act with respect to the disposition of all securities
covered by the Registration Statement during the applicable period in accordance
with the intended methods of disposition by the Holders thereof set forth in the
Registration Statement, as so amended, or in such Prospectus, as so
supplemented.

                  (c) Notify Seller as promptly as reasonably possible and
confirm such notice in writing promptly following the day (i)(A) when a
Prospectus or any Prospectus supplement or post-effective amendment to the
Registration Statement is proposed to be filed; (B) when the Commission notifies
the Company whether there will be a "review" of the Registration Statement and
whenever the Commission comments in writing on the Registration Statement (the
Company shall upon request provide true and complete copies thereof and all
written responses thereto to Seller); and (C) with respect to the Registration
Statement or any post-effective amendment, when the same has become effective;
(ii) of any request by the Commission or any other Federal or state governmental
authority during the Effectiveness Period for amendments or supplements to the
Registration Statement or Prospectus; (iii) of the issuance by the Commission or
any other federal or state governmental authority of any stop order suspending
the effectiveness of the Registration Statement covering any or all of the
Registrable Securities or the initiation of any Proceedings for that purpose;
(iv) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Registrable Securities for sale in any jurisdiction, or the initiation or
threatening of any Proceeding for such purpose; and (v) of the occurrence of any
event or passage of time that makes (A) the financial statements included in the
Registration Statement ineligible for inclusion therein or (B) any statement
made in the Registration Statement or Prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue in any material respect or
that requires any revisions to the Registration Statement, Prospectus or other
documents so that, in the case of the Registration Statement, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading and, in the case of the Prospectus, it will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein, or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.

                                       5
<PAGE>

                  (d) Use reasonable best efforts to avoid the issuance of, or,
if issued, obtain the withdrawal of (i) any order suspending the effectiveness
of the Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any Registrable Security for sale in any
jurisdiction, at the earliest practicable moment, in each case at the earliest
practicable moment. The Company agrees to use its reasonable best efforts to
amend the Registration Statement within fifteen (15) days after such cessation
of effectiveness in a manner reasonably expected to obtain the withdrawal of any
order suspending the effectiveness thereof.

                  (e) Furnish to each Seller, without charge, at least one
conformed copy of the Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated or
deemed to be incorporated therein by reference to the extent requested by
Seller, and all exhibits to the extent requested by Seller (including those
previously furnished or incorporated by reference) promptly after the filing of
such documents with the Commission.

                  (f) Promptly deliver to each Holder, without charge, as many
copies of the Prospectus or Prospectuses (including each form of prospectus) and
each amendment or supplement thereto as such persons may reasonably request.
Subject to the terms of this Agreement, the Company hereby consents to the use
of such Prospectus and each amendment or supplement thereto by each of the
selling Holders in connection with the offering and sale of the Registrable
Securities covered by such Prospectus and any amendment or supplement thereto,
except after the Company's giving of any notice pursuant to Section 3(c).

                  (g) Prior to any resale of Registrable Securities by a Holder,
(i) to register or qualify such Registrable Securities for the resale by the
Holder under the securities laws of the United States, applicable states thereof
or cooperate with the selling Holders in connection with the registration or
qualification (or exemption from the Registration or qualification) of such
Registrable Securities for the resale by the Holder under the securities or Blue
Sky laws of such jurisdictions within the United States as any Holder reasonably
requests in writing, (ii) to cause such Registrable Securities to be registered
with or approved by such other governmental agencies or authorities as may be
necessary by virtue of the business and operations of the Company, (iii) to keep
such Registration Statement or qualification (or exemption therefrom) effective
during the Effectiveness Period and (iv) to do any and all other acts or things
reasonably necessary to enable the disposition in such jurisdictions of the
Registrable Securities covered by the Registration Statement; provided, that the
Company shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified, subject the Company to any
material tax in any such jurisdiction where it is not then so subject or file a
general consent to service of process in any such jurisdiction.

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

                                       6
<PAGE>

                  (i) Upon the occurrence of any event contemplated by Section
3(c)(v), as promptly as reasonably possible, prepare a supplement or amendment,
including a post-effective amendment, to the Registration Statement or a
supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither the Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Company notifies Seller ("SUSPENSION NOTICE") of the
occurrence of any event described in clauses (ii) through (v) of Section 3(c)
above and to suspend the use of any Prospectus until the requisite changes to
such Prospectus have been made, then Seller shall inform Holders to suspend use
of such Prospectus. The Company will use its best efforts to ensure that the use
of the Registration Statement and Prospectus may be resumed by each of the
Holders as promptly as is practicable and that the Regulatory Suspension (as
hereinafter defined) remains in effect for the shortest period possible;
PROVIDED, that the period of such Regulatory Suspension shall not exceed a
period of 45 days from the date of delivery of notice thereof by the Company to
the Selling Shareholders, and in any event when aggregated with any other
Regulatory Suspension or Disadvantageous Suspension shall not exceed more than
an aggregate of 90 days in any 365-day period. Subject to giving effect to the
preceding sentence and after giving written notice thereof to the Selling
Shareholders and the Seller, the Company shall be entitled to exercise its right
under this Section 3(i) to suspend the availability of a Registration Statement
and Prospectus ("REGULATORY SUSPENSION"), subject to the payment of Liquidated
Damages pursuant to Section 2(b). Liquidated Damages shall accrue commencing on
and including the date of delivery of such notice and shall continue until the
date of termination of such Regulatory Suspension, and payment for any such
Liquidated Damages shall be made no later than the first Trading Day of each
calendar month immediately following any date such Liquidated Damages are
accrued.

                  (j) Comply with all applicable rules and regulations of the
Commission.

                  (k) Cause all Registrable Securities covered by such
Registration Statement, or supplement or amendment thereto, to be listed on each
securities exchange or markets on which the Common Stock, or securities
exchanged or substituted for such Common Stock, are then listed or quoted, and
cooperate with each seller (and any underwriter) participating in the
disposition of such Registrable Securities, in connection with any filings
required to be made with any such exchange or markets.

                  (l) The Company may require each Holder to furnish to the
Company a certified statement as to the number of shares of Common Stock
beneficially owned by such Holder and, if required by the Commission, the person
thereof that has voting and dispositive control over the Purchase Shares. During
any periods that the Company is unable to meet its obligations hereunder with
respect to the registration of the Registrable Securities solely because any
Holder fails to furnish such information within five (5) Trading Days of the
Company's request, any Liquidated Damages that are accruing at such time shall
be tolled and any Event that may otherwise occur solely because of such delay
shall be suspended, until such information is delivered to the Company.

                                       7
<PAGE>

                  (m) Use its commercially reasonable efforts to take all
actions requested by a Holder or the managing underwriter engaged by the Holder
in order to facilitate the disposition of such Registrable Securities.

         4. REGISTRATION EXPENSES. All fees and expenses incident to the
performance of or compliance with this Agreement shall be borne by the Company
whether or not a Registration Statement is declared effective or any Registrable
Securities are sold pursuant to the Registration Statement. The fees and
expenses referred to in the foregoing sentence shall include, without
limitation, (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with any
securities exchange or market on which the Common Stock is then listed for
trading, and (B) relating to compliance and qualification with applicable state
securities or Blue Sky laws), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities), (iii)
messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel for the Company, and (v) fees and expenses of all other persons retained
by the Company in connection with the consummation of the transactions
contemplated by this Agreement. Notwithstanding the preceding sentence, other
than as set forth in Section 5(c) hereof, the Holders shall be solely
responsible for all fees and expenses of any counsel retained by any of them,
and will bear all underwriting discounts and all selling commissions from the
sale of the Registrable Securities by the Holders.

         5. INDEMNIFICATION

                  (a) INDEMNIFICATION BY THE COMPANY. The Company shall,
notwithstanding any termination of this Agreement, indemnify and hold harmless
Seller, each Holder, the officers, directors, agents and employees of each of
them, each Person who controls any such Holder (within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act) and the officers,
directors, agents and employees of each such controlling Person, to the fullest
extent permitted by applicable law, from and against any and all losses, claims,
damages, liabilities, costs (including, without limitation, reasonable
attorneys' fees) and expenses (collectively, "LOSSES"), (i) arising out of or
based upon any untrue or alleged untrue statement of a material fact contained
in the Registration Statement, any Prospectus or in any amendment or supplement
thereto, or (ii) arising out of or relating to any omission or alleged omission
of a material fact required to be stated therein or necessary to make the
statements therein (in the case of any Prospectus or supplement thereto, in
light of the circumstances under which they were made) not misleading, or (iii)
any violation by the Company of the Securities Act, the Exchange Act or any
state securities law or any rule or regulation promulgated under the Securities
Act, the Exchange Act or any state securities law, except to the extent, but
only to the extent, that such Losses are caused by (Y) such untrue statements or
omissions or alleged untrue statements or omissions based upon information
regarding any Holder furnished in writing to the Company by such Holder
expressly for use therein, or (Z) in the case of an occurrence of an event of
the type specified in Section 3(c)(ii)-(v), the use by such Holder of an
outdated or defective Prospectus after the date the Holder has received notice
from the Company in writing that such Prospectus is outdated or defective and
prior to the receipt by such Holder of the Advice contemplated in Section 7(c).
The Company shall notify the Holders promptly of the institution, threat or
assertion of any Proceeding of which the Company is aware in connection with the
transactions contemplated by this Agreement.

                                       8
<PAGE>

                  (b) INDEMNIFICATION BY HOLDERS. Each Holder shall, severally
and not jointly, indemnify and hold harmless the Company, its directors,
officers, agents and employees, each Person who controls the Company (within the
meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act),
and the directors, officers, agents or employees of such controlling Persons, to
the fullest extent permitted by applicable law, from and against all Losses, as
incurred, to the extent arising out of or based upon (x) such Holder's failure
to deliver the Prospectus provided by the Company in accordance with this
Agreement, or (y) any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, any Prospectus, or any form of
prospectus, or in any amendment or supplement thereto or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of
a material fact required to be stated therein or necessary to make the
statements therein not misleading (i) to the extent, but only to the extent,
that such untrue statement or omission is contained in any information regarding
any Holder so furnished in writing by such Holder to the Company expressly for
inclusion in the Registration Statement or such Prospectus or (ii) in the case
of an occurrence of an event of the type specified in Section 3(c)(ii)-(v), the
use by such Holder of an outdated or defective Prospectus after the date the
Holder has received notice from, or has been delivered notice to Holder's
address last given to, the Company in writing that such Prospectus is outdated
or defective and prior to the receipt by or such delivery to such Holder of the
Advice contemplated in Section 7(c). In no event shall the liability of any
selling Holder hereunder be greater in amount than the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

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

                           An Indemnified Party shall have the right to employ
separate counsel in any such Proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed
in writing to pay such fees and expenses; (2) the Indemnifying Party shall have
failed promptly to assume the defense of such Proceeding and to employ counsel

                                       9
<PAGE>

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

                           Subject to the terms of this Agreement, all
reasonable fees and expenses of the Indemnified Party (including reasonable fees
and expenses to the extent incurred in connection with investigating or
preparing to defend such Proceeding in a manner not inconsistent with this
Section) shall be paid to the Indemnified Party, as incurred, within ten Trading
Days of written notice thereof to the Indemnifying Party; provided, that the
Indemnified Party shall promptly reimburse the Indemnifying Party for that
portion of such fees and expenses applicable to such actions for which such
Indemnified Party is not entitled to indemnification hereunder, determined based
upon the relative faults of the parties (determined as set forth in Section 5(d)
hereof).

                  (d) CONTRIBUTION. If the indemnification provided for in this
Section 5 is unavailable (by reason of, without limitation, public policy or
otherwise) to an Indemnified Party under Section 6(a) or 6(b) in respect of any
Losses or is insufficient to hold such Indemnified Party harmless, then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
severally but not jointly, contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party or Parties,
on the one hand, and such Indemnified Party, on the other hand, in connection
with the actions, statements or omissions that resulted in such Losses as well
as any other relevant equitable considerations. The relative fault of such
Indemnifying Party or Parties, on the one hand, and Indemnified Party, on the
other hand, shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission of a material fact, has been taken
or made by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action, statement or
omission. The amount paid or payable by a party as a result of any Losses shall
be deemed to include, subject to the limitations set forth in this Agreement,
any reasonable attorneys' or other reasonable fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have been
indemnified for such fees or expenses if the indemnification provided for in
this Section was available to such party in accordance with its terms.

                                       10
<PAGE>

                           The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 5(d) were determined by
pro rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 5(d), no Holder shall
be required to contribute, in the aggregate, any amount in excess of the amount
by which the net proceeds actually received by such Holder from the sale of the
Registrable Securities subject or giving rise to the Proceeding, except in the
case of fraud by such Holder.

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

                  (e) The provisions of this Section 5 shall survive so long as
Registrable Securities remain outstanding, notwithstanding any permitted
transfer of the Registrable Securities by any Holder or any termination of this
Agreement.

         6. COMPANY REPRESENTATIONS. The Company represents and warrants to the
Seller as follows:

                  (a) AUTHORIZATION. All corporate action on the part of the
Company, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement and the performance of
all obligations of the Company hereunder has been taken or will be taken prior
to the Closing.

                  (b) STATUS OF PURCHASE SHARES. The Purchase Shares, when
issued pursuant to the terms of the Purchase Agreement, will be duly authorized,
validly issued and outstanding, fully paid and nonassessable, free and clear of
any mortgage, pledge, security interest, charge, lien or encumbrance of any
kind, and will not be in violation of any preemptive or similar rights of any
person. The Company is not bound by any agreement or understanding restricting
its right to issue or transfer the Purchase Shares.

                  (c) SEC FILINGS. Neither Company's Report on Form 10-K for the
year ended December 31, 2003 nor any other document filed by the Company with
the Securities and Exchange Commission ("SEC") since March 3, 2004
(collectively, the "SEC FILINGS"), contained a misstatement of a material fact
or failed to state a material fact required to be stated therein or necessary to
make the statements made therein not misleading as of the date such filing was
made. The consolidated financial statements of the Company and its subsidiaries
included in the SEC Filings comply as to form in all material respects with
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto, have been prepared or, for Company filings
after the date hereof, will be prepared in accordance with GAAP applied on a
consistent basis throughout the periods involved (except as may be indicated in
the notes thereto or, in the case of the unaudited interim financial statements,
as permitted by Form 10-Q of the SEC) and fairly present or, for Company filings
after the date hereof, will fairly present (subject, in the case of the
unaudited interim financial statements, to normal, year-end audit adjustments,
which are not material in amount) the consolidated financial position of the
Company and its subsidiaries as at the dates thereof and the consolidated
results of their operations and cash flow for the periods then ended.

                                       11
<PAGE>

                  (d) PRIVATE OFFERING; NO INTEGRATED OFFERING. Assuming the
accuracy of the Seller's representations and warranties in Section 8 hereto, the
offer and sale of the Purchase Shares to the Seller and issuance of the Purchase
Shares to the Holders pursuant to the Purchase Agreement is exempt from the
registration and prospectus delivery requirements of the Securities Act. Neither
the Company nor any person acting on its behalf has offered or will offer Common
Stock or the Purchase Shares or any part thereof or any similar securities for
issuance or sale to, or has solicited or will solicit any offer to acquire any
of the same from, any person so as to bring the issuance and sale by the Company
of the Purchase Shares within the provisions of the registration and prospectus
delivery requirements of the Securities Act. The Company has not offered, sold,
contracted to sell, pledged or disposed of, and will not at any time offer,
sell, contract to sell, pledge or otherwise dispose of, directly or indirectly,
any securities under circumstances where such offer, sale, pledge, contract or
disposition would cause the exemption under the Securities Act pursuant to which
the Purchase Shares are issuable without registration to the Seller and Holders
to cease to be applicable to the offer and sale of the Purchase Shares or cause
them to be integrated with any prior offering of securities of the Company for
purposes of the Securities Act (in circumstances which would require
registration of the Purchase Shares) or any applicable shareholder approval
provisions under any securities exchange or market upon which the Common Stock
is listed or quoted.

                  (e) INVESTMENT COMPANY ACT. The Company is not, and during the
term of this Agreement will not be, an "investment company," or a company
"controlled by" an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.

         7. MISCELLANEOUS.

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

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

                                       12
<PAGE>

                  (c) DISCONTINUED DISPOSITION. Each Holder agrees by its
acquisition of such Registrable Securities that, upon receipt of a notice from
the Company of a Suspension Notice and subject to the provisions and limitation
of Section 3(i), such Holder will forthwith discontinue disposition of such
Registrable Securities under the Registration Statement until such Holder's
receipt of the copies of the supplemented Prospectus and/or amended Registration
Statement or until it is advised in writing (the "ADVICE") by the Company that
the use of the applicable Prospectus may be resumed, and, in either case, has
received copies of any additional or supplemental filings that are incorporated
or deemed to be incorporated by reference in such Prospectus or Registration
Statement. The Company may provide appropriate stop orders to enforce the
provisions of this paragraph; provided, that the Company and any such stop
orders comply with the provisions and limitations set forth in Section 3(i).

                  (d) PIGGY BACK REGISTRATION.

                           (i) REGISTRATION PROCEDURES. If at any time during
the Effectiveness Period there is not an effective Registration Statement
covering all of the Registrable Securities and the Company shall determine to
prepare and file with the Commission a Registration Statement relating to an
offering for its own account or the account of others under the Securities Act
of any of its equity securities, other than on Form S-4 or Form S-8 (each as
promulgated under the Securities Act) or their then equivalent forms relating to
equity securities to be issued solely in connection with any acquisition of any
entity or business or equity securities issuable in connection with the stock
option or other employee benefit plans, then the Company shall send to each
Holder a written notice of such proposed filing at least 25 days before the
anticipated filing. The notice referred to in the preceding sentence shall (i)
describe the proposed registration and offering and (ii) offer each Holder the
opportunity to register, offer or sell such amount of Registrable Securities as
any such Holder may request (a "PIGGYBACK REGISTRATION"). If within fifteen days
after the date of such notice, any such Holder shall so request in writing, the
Company shall include in such Piggyback Registration (and any related
qualification under state blue sky laws and other compliance filings, and any
underwriting involved therein) all Registrable Securities such Holder requests
to be registered; PROVIDED, that, the Company shall not be required to register
any Registrable Securities pursuant to this Section 7(d) that at such time may
be resold pursuant to Rule 144(k) promulgated under the Securities Act or that
are registered under a then effective Registration Statement which is not
subject to a discontinuance of disposition pursuant to Section 7(c). Holder will
be permitted to withdraw any or all of its Registrable Securities from a
Piggyback Registration at any time prior to the effective date of such Piggyback
Registration. If a Holder decides not to include all of its Registrable
Securities in any Registration Statement thereafter filed by the Company, such
Holder shall nevertheless continue to have the right to include any Registrable
Securities in any subsequent Registration Statement or Registration Statements
as may be filed by the Company with respect to offerings of its securities, all
upon the terms and conditions set forth therein.

                           (ii) FIRST PRIORITY PIGGYBACK REGISTRATION. The
Company will cause the managing underwriter or underwriters, if any, of a
proposed registration of securities of the Company through underwriters to
permit any Holder, if holding Registrable Securities requested to be included in
such registration, to include in the registration for such offering all such
requested Registrable Securities on the same terms and conditions as any
securities of the Company included therein; provided, that the Holder shall give

                                       13
<PAGE>

customary representations and warranties and the Holder's indemnification
obligations shall be limited as set forth in Section 5(b) hereof. The Company
shall cooperate with the Holder in order to limit any representations and
warranties to, or agreements with, the Company or the underwriters to be made by
Holder only to those representations, warranties or agreements regarding
Holder's Registrable Securities and intended method of distribution, and as
required by law. If such managing underwriter or underwriters advises Holder in
writing to the effect that the total amount of securities that Holder, the
Company and any other person propose to include in such offering is such as to
materially and adversely affect the success of such offering, such Registrable
Securities of such Holder shall be subject to customary underwriter cutbacks
applicable to all holders of securities subject to registration in such
offering.

                  (e) AMENDMENTS AND WAIVERS, The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the same shall be in writing and signed by the Company
and each Holder of the then outstanding Registrable Securities. Notwithstanding
the foregoing, a waiver or consent to depart from the provisions hereof with
respect to a matter that relates exclusively to the rights of certain Holders
and that does not directly or indirectly affect the rights of other Holders may
be given by Holders of all of the Registrable Securities to which such waiver or
consent relates.

                  (f) NOTICES. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be made in
accordance with the provisions of the Purchase Agreement.

                  (g) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each Holder and any permitted
transferee. Each Holder may transfer (including, without limitation, by
donation, devise or gift) or assign, by written agreement, any or all of such
Holder's registration rights granted hereunder to any direct or indirect
transferee or assignee of such Holder's Registrable Securities; PROVIDED, that
such assignee or transferee shall agree, in form and substance reasonably
satisfactory to the Company and the Holders, to be bound by the terms and
provisions of this Agreement; PROVIDED, that the Company may not assign its
obligations hereunder; FURTHER PROVIDED, that if the Company is a party to any
merger, consolidation, recapitalization, reorganization or otherwise pursuant to
which the Registrable Securities are converted into or exchanged for securities
or the right to receive securities of any other person ("CONVERSION
SECURITIES"), then the Company shall not effect any such action unless the
issuer of such Conversion Securities shall have previously assumed in writing,
to be delivered to all Holders, all obligations of the Company hereunder.
Following any such transfer or assignment, such transferring or assigning Holder
shall retain all rights under this Agreement with respect to the Registrable
Securities that continue to be held by such Holder.

                                       14
<PAGE>

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

                  (i) GOVERNING LAW. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be determined
with the provisions of the Purchase Agreement.

                  (j) CUMULATIVE REMEDIES. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.

                  (k) SEVERABILITY. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable best efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction.

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

                  (m) INDEPENDENT NATURE OF PURCHASERS' OBLIGATIONS AND RIGHTS.
The obligations of each Holder hereunder are several and not joint with the
obligations of any other Holder hereunder, and no Holder shall be responsible in
any way for the performance of the obligations of any other Holder hereunder.
Nothing contained herein or in any other agreement or document delivered at any
closing, and no action taken by any Holder pursuant hereto or thereto, shall be
deemed to constitute the Holders as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Holders
are in any way acting in concert with respect to such obligations or the
transactions contemplated by this Agreement. Each Holder shall be entitled to
protect and enforce its rights, including without limitation the rights arising
out of this Agreement, and it shall not be necessary for any other Holder to be
joined as an additional party in any proceeding for such purpose.

                  (n) DELAYS OR OMISSIONS. It is agreed that no delay or
omission to exercise any right, power or remedy accruing to any Holder, upon any
breach, default or noncompliance of the Company under this Agreement shall
impair any such right, power or remedy, nor shall it be construed to be a waiver
of any such breach, default or noncompliance, or any acquiescence therein, or of
any similar breach, default or noncompliance thereafter occurring. It is further
agreed that any waiver, permit, consent or approval of any kind or character on
any Holder's part of any breach, default or noncompliance under the Agreement or
any waiver on such Holder's part of any provisions or conditions of this
Agreement must be in writing and shall be effective only to the extent
specifically set forth in such writing.

                                       15
<PAGE>

         8. INVESTMENT REPRESENTATIONS. Each Selling Shareholder understands
that the Purchase Shares are being offered and sold pursuant to a private
placement exemption from registration contained in the Securities Act based in
part upon such Selling Shareholder's representations contained in this
Agreement. Accordingly, each Selling Shareholder, severally and not jointly,
represents and warrants to the Company and Purchaser as of the date hereof as
follows:

                  (a) Such Selling Shareholder has substantial experience in
evaluating and investing in private placement transactions of securities in
companies similar to Company so that such Selling Shareholder is capable of
evaluating the merits and risks of its investment in Company and has the
capacity to protect its own interests. Selling Shareholder understands that it
must bear the economic risk of this investment indefinitely unless the Purchase
Shares are registered pursuant to the Securities Act, or an exemption from
registration is available.

                  (b) Selling Shareholder is acquiring the Purchase Shares for
its own account for investment only, and not with a view towards their
distribution.

                  (c) Selling Shareholder represents that by reason of its, or
of its management's, business or financial experience, Selling Shareholder has
the capacity to protect its own interests in connection with the transactions
contemplated in the Purchase Agreement. Further, Selling Shareholder is aware of
no publication of any advertisement in connection with the transactions
contemplated in the Purchase Agreement.

                  (d) Selling Shareholder and each of its members, as
applicable, are accredited investors within the meaning of Rule 501(a) of
Regulation D under the Securities Act.

                  (e) Selling Shareholder has had an opportunity to discuss
Company's business, management and financial affairs with directors, officers
and management of Company and has had the opportunity to review Company `s
operations and facilities. Selling Shareholder also has had the opportunity to
ask questions of and receive answers from Company and its management regarding
the terms and conditions of this investment.

                  (f) Selling Shareholder acknowledges and agrees that the
Purchase Shares must be held indefinitely unless they are subsequently
registered under the Securities Act or an exemption from such registration is
available. Selling Shareholder has been advised or is aware of the provisions of
Rule 144 promulgated under the Securities Act as in effect from time to time,
which permits limited resale of shares purchased in a private placement subject
to the satisfaction of certain conditions, including, among other things: the
availability of certain current public information about the Company, the resale
occurring following the required holding period under Rule 144 and the number of
shares being sold during any three-month period not exceeding specified
limitations.

                  (g) The office or offices of Selling Shareholder in which its
investment decision was made is located at the address or addresses of Seller
set forth in Part 2.23(g) of the Disclosure Schedule. Selling Shareholder is a
United States person (as defined by Section 7701(a)(30) of the Internal Revenue
Code of 1986, as amended).

                                       16
<PAGE>

                  (h) Selling Shareholder acknowledges and agrees that the
Purchase Shares are subject to restrictions on transfer as set forth in the
applicable securities laws.

         9. CERTIFICATIONS. All certificates representing the purchase shares
shall have endorsed thereon legends in substantially the following forms (in
addition to any other legend which may be required by other agreements between
the parties hereto):

                  (a) (i) "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS
RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY AND ITS
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED."

                           (ii) Any legend required by appropriate blue sky
officials.

                  (b) The Company shall be obligated to reissue promptly
certificates without the foregoing legend upon the request of any Holder
thereof, if the Holder shall have obtained an opinion of counsel reasonably
acceptable to the Company to the effect that the securities proposed to be
disposed of may lawfully be disposed of without registration, qualification or
legend.

                  (c) Any legend endorsed on an instrument pursuant to
applicable state securities laws and the stop-transfer instruction with respect
to such securities shall be removed upon receipt by the Company of an opinion of
counsel reasonably satisfactory to the Company or an order of the appropriate
blue sky authority authorizing such removal.

         10. BOARD REPRESENTATION. As long as Anthony O. Brown ("Brown") and his
affiliates collectively own, either directly or beneficially, not less than
495,465 shares of Common Stock, subject to adjustment for any stock split,
dividend or other distribution, recapitalization or any similar event (the
"BROWN MINIMUM HOLDINGS"), upon written request by Brown, the Company shall use
its reasonable best efforts to cause Brown or his designee (which designee must
be reasonably acceptable to Acacia) to be elected to the Board of Directors of
the Company. Without limitation of the foregoing, the Company shall nominate
Brown or his designee to serve on the Board of Directors upon such request by
Brown, to be voted on in the next succeeding annual or special meeting for
election of directors following such request by Brown, and in successive annual
meetings thereafter so long as Brown continues to own the Brown Minimum
Holdings, until Brown is so elected, and shall treat Brown or his designee in
the same manner as other nominees selected by the Board of Directors of the
Company. The parties agree and acknowledge that pursuant to the Company's
Bylaws, the Board of Directors has the right to appoint an interim director to
fill any vacancy, but any election of a board member must be pursuant to the

                                       17
<PAGE>

vote of the Company's shareholders. The provisions of this Section 10 shall
survive any termination of this agreement and continue in accordance with the
terms hereof. Notwithstanding anything contained in the Agreement to the
contrary, the parties hereby acknowledge and agree that Brown shall be entitled
to enforce the rights and privileges under this Section 10 in his sole
discretion and, without limiting any remedies available at law or equity, Brown
shall be entitled to seek specific performance or injunctive relief to enforce
this Section 10.

                      [THIS SPACE INTENTIONALLY LEFT BLANK]

                                       18
<PAGE>

         IN WITNESS WHEREOF, the parties have duly executed this Registration
Rights Agreement as of the day and year first above written.

COMPANY:                                 ACACIA RESEARCH CORPORATION,
                                         a Delaware corporation

                                         By: /S/ Robert A Berman
                                             -----------------------------------
                                         Name: Robert A Berman
                                         Title: Chief Operating Officer

PURCHASER:                               ACACIA GLOBAL ACQUISITION CORPORATION,
                                         a Delaware corporation

                                         By: /S/ Robert A Berman
                                             -----------------------------------

                                         Name: Robert A Berman
                                         Title: Chief Operating Officer

SELLER:                                  GLOBAL PATENT HOLDINGS, LLC
                                         an Illinois limited liability company

                                         By: /S/ Anthony O. Brown
                                             -----------------------------------
                                         Name: Anthony O. Brown

                                         Title: Manager

SELLING SHAREHOLDERS:                    By: /S/ Richard Angell
                                             ----------------------------------
                                             Richard Angell

                                         By: /S/ Anthony O. Brown
                                             ----------------------------------
                                             Anthony O. Brown

                                         By: /S/ Scott Paseltiner
                                             ----------------------------------
                                             Scott Paseltiner

                                         By: /S/ Dooyong Lee
                                             ----------------------------------
                                             Dooyong Lee

                                         By: /S/ Scott Turbin
                                             ----------------------------------
                                             Scott Turbin
                                             Partner KDS LLC

                                         By: /S/ Daniel Asher
                                             ----------------------------------
                                             Daniel Asher

                                         By: /S/ Robert Krasnow
                                             ----------------------------------
                                             Robert Krasnow

                                         By: /S/ James D. Esser
                                             ----------------------------------
                                             James D. Esser

                                         By: /S/ Marshall N. Toplansky
                                             ----------------------------------
                                             Marshall N. Toplansky

                                         By: /S/ James Cohen
                                             ----------------------------------
                                             James Cohen

                                       19
<PAGE>

                                         By: /S/ Richard R. Taylor
                                             ----------------------------------
                                             Richard R. Taylor

                                         By: /S/ Thomas M. Harney, Trustee
                                             ----------------------------------
                                             Thomas M. Harney, Trustee
                                             Thomas M. Harney,
                                             Revocable Trust UTD 5/31/88

                                         By: /S/ Michael Vender
                                             ----------------------------------
                                             Michael Vender

                                         By: /S/ Patrick J. McGarvey
                                             ----------------------------------
                                             Patrick J. McGarvey

                                         By: /S/ Jack Lavin
                                             ----------------------------------
                                             Jack Lavin

                                         By: /S/ Thomas Henrich
                                             ----------------------------------
                                             Thomas Henrich

                                       20
<PAGE>

                                   EXHIBIT "A"

                              PLAN OF DISTRIBUTION

         We are registering the shares of AR-Acacia Technologies common stock on
behalf of the selling stockholders. A selling stockholder is a person named in
the section entitled "Selling Stockholders" and also includes any donee,
pledgee, transferee or other successor-in-interest selling shares received after
the date of this prospectus from a selling stockholder as a gift or other
non-sale related transfer.

         We do not know of any plan of distribution for the resale of our
AR-Acacia Technologies common stock by the Selling Stockholders. We will not
receive any of the proceeds from the sale by the Selling Stockholders of any of
the resale shares.

         We expect that the Selling Stockholders or transferees may sell the
resale shares from time to time in one or more transactions on Nasdaq or any
other exchange upon which the company may become listed, in privately negotiated
transactions, through put or call option transactions relating to the shares, or
a combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Stockholders may
sell the resale shares to or through broker-dealers, and such broker-dealers may
receive compensation from the Selling Stockholders or the purchasers of the
resale shares, or both.

         The selling stockholders may also enter into hedging transactions,
options or other transactions with broker-dealers or other financial
institutions that require the delivery to these broker-dealers or other
financial institutions of shares offered by this prospectus, which shares these
broker-dealer or other financial institution may resell pursuant to this
prospectus (as amended or supplemented to reflect such transaction). These
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from selling stockholders and/or the purchasers of shares for whom
these broker-dealers may act as agents or to whom they sell as principal, or
both. For example, the Selling Stockholders may:

         o        enter into transactions with a broker-dealer or affiliate of a
                  broker-dealer or other third party in connection with which
                  that other party will become a Selling Stockholder and engage
                  in short sales of securities under this prospectus, in which
                  case the other party may use securities received from the
                  Selling Stockholders to close out any short positions;

         o        sell short the securities under this prospectus and use the
                  securities held by it to close out any short position;

         o        enter into options, forwards or other transactions that
                  require the Selling Stockholders to deliver, in a transaction
                  exempt from registration under the Securities Act, the
                  securities to a broker-dealer or an affiliate of a
                  broker-dealer or other third party who may then become a
                  Selling Stockholder and publicly resell or otherwise transfer
                  the securities under this prospectus; or

                               Exhibit A, Page 1
<PAGE>

         o        loan or pledge the securities to a broker-dealer or an
                  affiliate of a broker-dealer or other third party who may then
                  become a Selling Stockholder and sell the loaned securities
                  or, upon an event of default in the case of a pledge, become a
                  Selling Stockholder and sell the pledged securities, under
                  this prospectus.

         The Selling Stockholders have advised us that they have not entered
into any agreements, arrangements or understandings with any underwriter,
broker-dealer or agent regarding the sale of their securities.

         The selling stockholders and any broker-dealers that act in connection
with the sale of shares may be "underwriters" within the meaning of Section
2(11) of the Securities Act, and any commissions received by these
broker-dealers or any profit on the resale of the shares sold by them while
acting as principals might be deemed to be underwriting discounts or commissions
under the Securities Act.

         Because selling stockholders may be "underwriters" within the meaning
of Section 2(11) of the Securities Act, the selling stockholders may be subject
to the prospectus delivery requirements of the Securities Act. Furthermore,
selling stockholders also may resell all or a portion of the shares in open
market transactions in reliance upon Rule 144 under the Securities Act, provided
they meet the criteria and conform to the requirements of Rule 144. We have
informed the selling stockholders that the anti-manipulative provisions of
Regulation M promulgated under the Exchange Act may apply to their sales in the
market.

         In addition, if we are notified by a selling stockholder that a donee,
pledgee or transferee or other successor in interest intends to sell more than
500 shares, a supplement to this prospectus will be filed.

         At any time a particular offer of resale shares is made, to the extent
required, a supplemental prospectus will be distributed which will set forth the
number of resale shares offered and the terms of the offering including the name
or names of any underwriters, dealers or agents, the purchase price paid by any
underwriter for the resale shares purchased from the selling stockholders, any
discounts, commission and other items constituting compensation from the selling
stockholders and any discounts, concessions or commissions allowed or paid to
dealers. We do not presently intend to use any forms of prospectus other than
print.

         The Selling Stockholders and any other persons participating in the
sale or distribution of the resale shares will be subject to the federal
securities laws and must comply with certain terms of the requirements of the
Securities Act and the Exchange Act, including Rule 10b-5 and Regulation M under
the Exchange Act. These rules and regulations may limit the timing of purchases
and sales of shares of our AR-Acacia Technologies common stock by the Selling
Stockholders or other persons. Under these rules and regulations, generally,
except as otherwise permitted the thereby, Selling Stockholders and other
persons participating in the sale or distribution:

                               Exhibit A, Page 2
<PAGE>

         o        may not engage in any stabilization activity in connection
                  with our AR-Acacia Technologies common stock,

         o        must furnish each broker which offers resale shares covered by
                  this prospectus with the number of copies of this prospectus
                  and any supplement which are required by the broker, and

         o        may not bid for or purchase any of our AR-Acacia Technologies
                  common stock or attempt to induce any person to purchase any
                  of our AR-Acacia Technologies common stock other than as
                  permitted under the Exchange Act.

         We will make copies of this prospectus available to the Selling
Stockholders, and we have informed the Selling Stockholders of the need for
delivery of a copy of this prospectus to each purchaser of the resale shares
prior to or at the time of any sale of the resale shares offered hereby.

         We may suspend the effectiveness or use of, or trading under, the
registration statement if we determine that the sale of any securities pursuant
to the registration statement would:

         o        materially impede, delay or interfere with any material
                  pending or proposed financing, acquisition, corporate
                  reorganization or other similar transaction involving the
                  company for which we have authorized negotiations; materially
                  adversely impair the consummation of any pending or proposed
                  material offering or sale of any class of securities by the
                  company, or

         o        require disclosure of material nonpublic information that, if
                  disclosed at such time, would be materially harmful to the
                  interests of the company and our stockholders.

         We will pay all costs and expenses associated with registering and
qualifying the resale shares being offered hereunder with the SEC and any state
securities agencies. The selling stockholders will bear their own legal fees and
costs and all commissions, discounts and expenses of underwriters or brokers, if
any, attributable to the sales of the shares.

         We and the selling stockholders have agreed to indemnify each other
against certain liabilities that could arise from the registration and sale of
the shares.

                               Exhibit A, Page 3

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