Document:

Unassociated Document

    Exhibit
      10.4

     

    
      

        NEITHER
          THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE
          HAVE
          BEEN
          REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
          COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION
          UNDER THE SECURITIES ACT OF 1933 (THE "SECURITIES ACT"), AND, ACCORDINGLY,
          MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
          STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
          FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
          OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
          LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH
          EFFECT, THE SUBSTANCE OF WHICH WILL BE REASONABLY ACCEPTABLE TO THE COMPANY.

      

    

    

    COMMON
      STOCK PURCHASE WARRANT

    

    Warrant#:_______________________

     

    To
      purchase __________ shares of common stock of

     

    BULLION
      RIVER GOLD CORP.

     

    Dated:
      ____________________,
      2006

     

    This
      common stock purchase warrant
      (the
“Warrant”)
      certifies that, for value received,
      _________________________________(the
      “Holder”),
      is
      entitled, upon the terms and subject to the limitations on exercise and the
      conditions hereinafter set forth, at any time on or after the date given above
      (the “Initial
      Exercise Date”)
      and by
      the close of business on the second anniversary of the Initial Exercise Date
      (the “Termination
      Date”)
      but
      not thereafter, to subscribe for and purchase from Bullion River Gold Corp.,
      a
      Nevada corporation (the “Company”),
      up to
 _______________shares
      (the “Warrant
      Shares”)
      of
      common stock, par value $0.001 per share, of the Company (the “Common
      Stock”).
      The
      purchase price of one share of Common Stock under this Warrant is equal to
      the
      Exercise Price, as defined in Section 2(a).
      

     

    1.    Definitions.
      Capitalized terms used and not otherwise defined in this Warrant have the same
      meanings as they have in the Securities Purchase Agreement (the “Purchase
      Agreement”),
      dated
      _______________________,
      2006,
      among the Company and the Holder as Purchaser.

     

    2.    Exercise.

     

    (a)    Exercise
      Price.
      The
      exercise price of the Common Stock under this Warrant is $1.00,

     

    (b)    Exercise
      of Warrant.
      The
      Holder may exercise the purchase rights represented by this Warrant at any
      time
      from the Initial Exercise Date to five o’clock in the afternoon, Reno time, on
      the Termination Date by delivering to the Company (i) a duly executed facsimile
      copy of the annexed Notice of Exercise, and, (ii) within 5 Trading Days of
      delivering the Notice of Exercise to the Company, (A) this Warrant, and (B)
      by
      wire or cashier’s check drawn on a United States bank the United States dollar
      amount equal to the number of Warrant Shares being purchased times the Exercise
      Price (the “Exercise
      Amount”). 

     

    
      
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    (c)    Exercise
      limitations. 

     

    (i)    The
      Holder may not exercise any portion of this Warrant if, immediately after the
      Warrant Shares are issued, the Holder (together with the Holder’s Affiliates)
      would beneficially own more than 4.99% of the number of shares of the Common
      Stock outstanding.  For the purposes of the foregoing sentence, the number
      of shares of Common Stock beneficially owned by the Holder and its Affiliates
      includes the number of shares of Common Stock issuable upon the exercise of
      this
      Warrant, but excludes the number of shares of Common Stock that would be
      issuable upon (i) the Holder’s exercise of the remaining, unexercised portion of
      this Warrant and (ii) the Holder’s or its Affiliates’ exercise or conversion of
      the unexercised or nonconverted portion of any other securities of the Company
      that the Holder or any of its Affiliates own beneficially. 
      Except as set forth in the foregoing sentence, for the purposes of this Section
      2(c),
      beneficial ownership must be calculated in accordance with Section 13(d) of
      the
      Securities and Exchange Act of 1934 (“Exchange
      Act”).

     

    (ii)    The
      Holder acknowledges that the Company is not representing to Holder that the
      calculation described in Section 2(c)(i)
      complies
      with Section 13(d) of the Exchange Act and Holder is solely responsible for
      any
      schedules required to be filed in accordance with it. The determination of
      whether this Warrant is exercisable (in relation to other securities owned
      by
      the Holder and its Affiliates) is in the sole discretion of the Holder, and
      the
      submission of a Notice of Exercise is deemed to be the Holder’s declaration that
      the Holder has determined that this Warrant is exercisable as set out in the
      Notice of Exercise and subject to the limitations in this Section 2(c);
      and the
      Company is not obliged to verify or confirm the accuracy of the Holder’s
      determination.

     

    (iii)    For
      the
      purposes of this Section 2(c),
      in
      determining the number of outstanding shares of Common Stock, the Holder may
      rely on the number of outstanding shares of Common Stock as reflected in the
      most recent of (A) the latest filed of the Company’s Form 10-QSB and Form
      10-KSB, (B) a public announcement by the Company stating the number of shares
      of
      Common Stock outstanding, or (C) any other notice by the Company or the
      Company’s Transfer Agent stating the number of shares of Common Stock
      outstanding.  If Holder asks for it, the Company will within two Trading
      Days confirm orally and in writing to the Holder the number of shares of Common
      Stock then outstanding.

     

    (d)    Mechanics
      of Exercise.

     

    (i)    Authorization
      of Warrant Shares.
      The
      Company will issue all Warrant Shares as duly authorized, validly issued, fully
      paid and non-assessable, and free from all taxes, liens and charges (other
      than
      taxes in respect of any transfer occurring contemporaneously with the issue).
      

     

    
      
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    (ii)    Delivery
      of certificates upon exercise.
      The
      Company’s transfer agent will deliver certificates for Warrant Shares to the
      Holder to the address specified by the Holder in the Notice of Exercise within
      3
      Trading Days from the later of (A) the Company’s receipt of the Notice of
      Exercise, (B) the Holder’s surrender of this Warrant, and (C) the Company’s
      receipt of the Exercise Amount as set out in Section 2(b)
      (“Warrant
      Share Delivery Date”).
      This
      Warrant is deemed to have been exercised on the date the Exercise Amount is
      received by the Company (“Exercise
      Date”);
      and
      the Warrant Shares are deemed to have been issued, and Holder is deemed to
      have
      become a holder of record of the shares for all purposes, on the Exercise
      Date.

     

    (iii)    Delivery
      of new Warrants upon exercise.
      If this
      Warrant is exercised in part, the Company will, when it delivers the certificate
      or certificates representing Warrant Shares, deliver to Holder a new Warrant
      evidencing the rights of Holder to purchase the unpurchased Warrant Shares,
      identical in all other respects with this Warrant.

     

    (iv)    Rescission
      rights.
      If the
      Company fails to cause its transfer agent to transmit to the Holder a
      certificate or certificates representing the Warrant Shares pursuant to this
      Section 2(d)(iv)
      by the
      Warrant Share Delivery Date, then the Holder may rescind the
      exercise.

     

    (v)    
      No
      fractional shares or scrip.
      No
      fractional shares or scrip representing fractional shares may be issued upon
      the
      exercise of this Warrant. If the Holder would otherwise be entitled to
      fractional shares upon the exercise, the Company will pay a cash adjustment
      in
      respect of the fraction in an amount equal to the fraction multiplied by the
      Exercise Price.

     

    (vi)    Charges,
      taxes and expenses.
      The
      Company will issue certificates for Warrant Shares in the name of the Holder
      and
      will not charge the Holder for any issue or transfer tax or other incidental
      expense in respect of the issuance of the certificate.

     

    (vii)    Closing
      of books.
      The
      Company will not close its stockholder books or records in any manner that
      prevents the timely exercise of this Warrant.

     

    3.    Certain
      Adjustments.

     

    (a)    Stock
      dividends and splits.
      If the
      Company, at any time while this Warrant is outstanding,
      (i)
      pays a stock dividend or otherwise makes a distribution on shares of its Common
      Stock or any other Common Stock Equivalent (which, for avoidance of doubt,
      does
      not include any shares of Common Stock issued by the Company pursuant to this
      Warrant), (ii) subdivides outstanding shares of Common Stock into a larger
      number of shares, (iii) combines outstanding shares of Common Stock into a
      smaller number of shares, or (iv) issues by reclassification of shares of the
      Common Stock any shares of capital stock of the Company, then the Exercise
      Price
      must be multiplied by a fraction of which the numerator is the number of shares
      of Common Stock (excluding treasury shares, if any) outstanding before the
      event
      and of which the denominator is the number of shares of Common Stock outstanding
      after the event, and the number of shares issuable upon exercise of this Warrant
      must be proportionately adjusted by this fraction. Any adjustment made pursuant
      to this Section 3(a)
      is
      effective immediately after the record date for the determination of
      stockholders entitled to receive the dividend or distribution and is effective
      immediately after the effective date in the case of a subdivision, combination
      or re-classification.

     

    
      
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          3 of 7

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)    Fundamental
      Transaction.
      If, at
      any time while this Warrant is outstanding,
      (i) the
      Company merges or consolidates with or into another Person, (ii) the Company
      sells all or substantially all of its assets in one or a series of related
      transactions, (iii) any Person completes a tender offer or exchange offer by
      which holders of Common Stock are permitted to tender or exchange their shares
      for other securities, cash or property, or (iv) the Company reclassifies its
      Common Stock or completes any compulsory share exchange pursuant to which the
      Common Stock is effectively converted into or exchanged for other securities,
      cash or property (in any such case, a “Fundamental
      Transaction”),
      then,
      upon any subsequent conversion of this Warrant, the Holder has the right to
      receive, for each Warrant Share that would have been issued upon the exercise
      absent the Fundamental Transaction, the same consideration as the Company has
      given its other holders of its Common Stock for the conversion of their Common
      Stock outstanding at the time of the Fundamental Transaction (the “Alternate
      Consideration”).
      Any
      successor to the Company or surviving entity in a Fundamental Transaction must
      issue to the Holder a new warrant consistent with the foregoing provisions
      with
      evidence of the Holder’s right to exercise the warrant into Alternate
      Consideration. The terms of any agreement pursuant to which a Fundamental
      Transaction is completed must include terms requiring the successor or surviving
      entity to comply with the provisions of this Section 3(b)
      and
      insuring that this Warrant (or any replacement security) is similarly adjusted
      upon any subsequent transaction analogous to a Fundamental
      Transaction.

     

    (c)    Calculations.
      All
      calculations under this Section 3
      must be
      made to the nearest cent or the nearest 1/100th
      of a
      share, as the case may be. The number of shares of Common Stock outstanding
      at
      any given time does not include shares of Common Stock owned or held by or
      for
      the account of the Company. For the purposes of this Section 3,
      the
      number of shares of Common Stock deemed to be issued and outstanding as of
      a
      given date is the sum of the number of shares of Common Stock (excluding
      treasury shares, if any) issued and outstanding.

     

    (d)    Notice
      to Holders.
      If the
      Company makes adjustments under this Section 3,
      the
      Company will promptly mail to each Holder a notice containing a description
      of
      the event that required the adjustment. If the Company proposes any transaction
      that affects the rights of the holders of its Common Stock, then the Company
      will notify the Holders of the proposal at least twenty days before the record
      date set for the transaction.

     

    
      
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          4 of 7

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    4.    Warrant
      register.
      The
      Company will register this Warrant on its warrant register and will treat the
      registered Holder as the absolute owner for all purposes.

     

    5.    Miscellaneous.

     

    (a)    Title
      to Warrant.
      This
      warrant is not transferable.

     

    (b)    No
      rights as shareholder until Exercise Date.
      This
      Warrant does not entitle the Holder to any voting rights or other rights as
      a
      shareholder of the Company before the Exercise Date. Upon the surrender of
      this
      Warrant and the payment of the aggregate Exercise Price, the Company will issue
      the Warrant Shares to the Holder as the record owner of the Warrant Shares
      as of
      the close of business on the Exercise Date.

     

    (c)    Loss,
      Theft, Destruction or Mutilation of Warrant.
      The
      Company covenants that upon receipt by the Company of evidence reasonably
      satisfactory to it of the loss, theft, destruction or mutilation of this Warrant
      or any stock certificate relating to the Warrant Shares, and, in case of loss,
      theft or destruction, of indemnity or security reasonably satisfactory to it,
      and upon surrender and cancellation of the Warrant or stock certificate, if
      mutilated, the Company will make and deliver a new Warrant or stock certificate
      of like tenor and dated as of the cancellation, in lieu of the Warrant or stock
      certificate.

     

    (d)    Saturdays,
      Sundays, Holidays, etc.
      If the
      last date for doing anything under this Warrant falls on a Saturday, Sunday
      or a
      legal holiday, then the thing may be done on the next succeeding Trading
      Day.

     

    (e)    Authorized
      Shares.

     

    (i)    The
      Company covenants that, while the Warrant is outstanding, it will reserve from
      its authorized and unissued Common Stock a sufficient number of shares to
      provide for the issuance of the Warrant Shares upon the exercise of any purchase
      rights under this Warrant. The Company further covenants that its issuance
      of
      this Warrant constitutes full authority to its officers who are charged with
      the
      duty of executing stock certificates to execute and issue the necessary
      certificates for the Warrant Shares upon the exercise of the purchase rights
      under this Warrant. The Company will take all such reasonable action as may
      be
      necessary to assure that the Warrant Shares are issued as provided without
      a
      violation of any applicable law or regulation, or of any requirements of the
      Trading Market upon which the Common Stock may be listed or quoted.

     

    (ii)    Unless
      waived or consented to by the Holder, the Company will not by any action avoid
      or seek to avoid the observance or performance of any of the terms of this
      Warrant, but will at all times in good faith assist in carrying out of all
      its
      terms and take whatever actions is necessary or appropriate to protect the
      rights of Holder under this Warrant from impairment.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (f)    Jurisdiction.
      All
      questions concerning the construction, validity, enforcement and interpretation
      of this Warrant must be determined in accordance with the provisions of the
      Purchase Agreement.

     

    (g)    Restrictions.
      The
      Holder acknowledges that the Holder’s sale or transfer of the Warrant Shares, if
      not registered, will be subject to restrictions upon resale imposed by state
      and
      federal securities laws.

     

    (h)    No
      waiver.
      No
      course of dealing or any delay or failure to exercise any right hereunder on
      the
      part of Holder operates as a waiver of the right or otherwise prejudices
      Holder’s rights, powers or remedies.

     

    (i)    Notice.
      Any
      notice, request or other document required or permitted to be given or delivered
      by either party to the other must be delivered in accordance with the notice
      provisions of the Purchase Agreement.

     

    (j)    Successors
      and Assigns.
      Subject
      to applicable securities laws, this Warrant inures to the benefit of and binds
      the successors and permitted assigns of the Company and the Holder.

     

    (k)    Amendment.
      Any
      amendment of this Warrant must be in writing and signed by both the Company
      and
      the Holder.

     

    (l)    Severability.
      Wherever possible, each provision of this Warrant must be interpreted under
      applicable law, but if any provision of this Warrant is prohibited by or invalid
      under applicable law, the provision is ineffective to the extent of the
      prohibition or invalidity, without invalidating the remaining provisions of
      this
      Warrant.

     

    (m)    Headings.
      The
      headings used in this Warrant are for the convenience of reference only and
      are
      not, for any purpose, deemed a part of this Warrant.

     

     
In
      witness whereof
      the
      Company has caused this Warrant to be executed by its duly authorized
      officer.

     

    

    Dated:___________________________  

     

    
      	 	
              BULLION
                RIVER GOLD CORP.

               

            
	 	
              By:  /s/
                Peter M.
                Kuhn                                      

              Name:
                Peter M. Kuhn

              Title:
                President

            

    

    
 

    
      
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    NOTICE
      OF EXERCISE

    

    To: Bullion
      River Gold Corp.

    

    The
      undersigned hereby elects to purchase ____________
Warrant
      Shares of the Company pursuant to the terms of the attached Warrant (only if
      exercised in full; if exercised in part, attach a copy of the Warrant), and
      tenders herewith payment of the exercise price in full, together with all
      applicable transfer taxes, if any.

     

    Payment
      will take the form of lawful money of United States.

     

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

     

    Please
      deliver the Warrant Shares to the following:

    

    ______________________________________

    ______________________________________

    ______________________________________

     

     

    __________________________________________________

    Signature
      of Holder or authorized signatory of Holder

     

    Name
      of
      Holder:_____________________________________________________________________________________

    Name
      of
      authorized
      signatory:___________________________________________________________________________

    Title
      of
      authorized
      signatory:____________________________________________________________________________

    Date:_____________________________________

     

     

    Page
      7 of
      7Unassociated Document

    Exhibit
      10.5

     

    
       

      THE
        SECURITIES SOLD HEREUNDER HAVE BEEN ISSUED PURSUANT TO AN EXEMPTION FROM
        REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED, PURSUANT TO
        REGULATION S THEREUNDER. THE SECURITIES SOLD HEREUNDER CANNOT BE TRANSFERRED,
        OFFERED, OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS (AS THAT TERM IS
        DEFINED IN REGULATION S) EXCEPT PURSUANT TO REGISTRATION UNDER THE SECURITIES
        ACT OF 1933, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION.

    

     

     

    SECURITIES
      PURCHASE AGREEMENT

     

    This
      Securities Purchase Agreement (this “Agreement”)
      is
      dated as of _______, 2006 among Bullion River Gold Corp., a Nevada corporation
      (the “Company”),
      and
      each purchaser identified on the signature pages hereto (each, including its
      successors and assigns, a “Purchaser” and collectively the “Purchasers”).

    

    WHEREAS,
      subject to the terms and conditions set forth in this Agreement and pursuant
      to
      Regulation S of the Securities Act of 1933, as amended (the “Securities
      Act”),
      the
      Company desires to issue and sell to each Purchaser, and each Purchaser,
      severally and not jointly, desires to purchase from the Company, securities
      of
      the Company as more fully described in this Agreement.

    

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

    

    ARTICLE
      I -DEFINITIONS

    

    1.1    Definitions.
      In
      addition to the terms defined elsewhere in this Agreement: (a) capitalized
      terms
      that are not otherwise defined herein have the meanings given to such terms
      in
      the Debentures (as defined herein), and (b) the following terms have the
      meanings indicated in this Section 1.1:

    

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

    

    “Closing”
means
      the closing of the purchase and sale of the Securities pursuant to Section
      2.1.

    

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

    

    “Commission”
means
      the Securities and Exchange Commission.

    

    “Common
      Stock”
means
      the common stock of the Company, par value $0.001 per share, and any other
      class
      of securities into which such securities may hereafter have been reclassified
      or
      changed into.

    

    “Common
      Stock Equivalents”
means
      any securities of the Company or the Subsidiaries (excluding any securities
      purchasable or issuable pursuant to this Agreement), which would entitle the
      holder thereof to acquire at any time Common Stock, including, without
      limitation, any debt, preferred stock, rights, options, warrants or other
      instrument that is at any time convertible into or exercisable or exchangeable
      for, or otherwise entitles the holder thereof to receive, Common
      Stock.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Debentures”
means,
      the 12% Unsecured Convertible Debentures due, subject to the terms therein
      October 1, 2008, issued by the Company to the Purchasers hereunder, in the
      form
      of Exhibit
      A.

    

    “Effective
      Date”
means
      the date that the initial Registration Statement filed by the Company pursuant
      to the Registration Rights Agreement is first declared effective by the
      Commission.

    

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

    

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

    

    “Material
      Adverse Effect”
shall
      have the meaning assigned to such term in Section 3.1(b).

    

    “Maximum
      Rate”
shall
      have the meaning ascribed to such term in Section 5.15.

    

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

    

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

    

    “Registration
      Rights Agreement”
means
      the Registration Rights Agreement, dated the date hereof, among the Company
      and
      the Purchasers, in the form of Exhibit
      B
      attached
      hereto.

    

    “Registration
      Statement”
means
      a
      registration statement meeting the requirements set forth in the Registration
      Rights Agreement and covering the resale of the Underlying Shares by each
      Purchaser as provided for in the Registration Rights Agreement.

    

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

    

    “Regulation
      S”
means
      Regulation S 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”
means
      the Debentures and the Underlying Shares.

    

    “Securities
      Act”
means
      the Securities Act of 1933, as amended.

    

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    “Short
      Sales”
shall
      include all “short sales” as defined in Rule 200 of Regulation SHO under the
      Exchange Act (but shall not be deemed to include the location and/or reservation
      of borrowable shares of Common Stock).

    

    “Subscription
      Amount”
means,
      as to each Purchaser, the aggregate amount to be paid for Debentures purchased
      hereunder as specified below such Purchaser’s name on the signature page of this
      Agreement and next to the heading “Subscription Amount”, in United States
      Dollars and in immediately available funds.

    

    “Subsidiary”
means
      any subsidiary of the Company.

    

    “Trading
      Day”
means
      a
      day on which the Common Stock is traded on a Trading Market.

    

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

    

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

    

    “Underlying
      Shares”
means
      the shares of Common Stock issued and issuable upon conversion of the Debentures
      and issued and issuable in lieu of the cash payment of interest on the
      Debentures in accordance with the terms of the Debentures.

    

    “Warrants”
      means
      the Common Stock Purchase Warrants in the form of the attached Exhibit
      C.

     

    “Warrant
      Shares”
      means
      the shares of Common Stock issuable upon exercise of the Warrants.

     

    ARTICLE
      II - PURCHASE AND SALE

    

    2.1    Closing.  
      On the Closing Date, upon the terms and subject to the conditions set forth
      herein, concurrent with the execution and delivery of this Agreement by the
      parties hereto, the Company agrees to sell, and each Purchaser agrees to
      purchase in the aggregate, severally and not jointly, up to $2,861,000 in
      principal amount of the Debentures. Each Purchaser shall deliver to the Company
      via wire transfer or a certified check immediately available funds equal to
      their Subscription Amount and the Company shall deliver to each Purchaser their
      respective Debenture as determined pursuant to Section 2.2(a) issuable at the
      Closing.  Upon satisfaction of the conditions set forth in Sections
      2.2 and 2.3, the Closing shall occur at the offices of the Company, or such
      other location as the parties shall mutually agree.

    

    2.2    Deliveries.

    

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

    

    
      
        
        

      

      
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    (i)    this
      Agreement duly executed by the Company;

    

    (ii)    a
      Debenture with a principal amount equal to such Purchaser’s Subscription Amount,
      registered in the name of such Purchaser;

    

    (iii)    the
      Registration Rights Agreement duly executed by the Company;

    

    (iv)    the
      Common Stock Purchase Warrant, in the form of Exhibit
      B
      attached
      hereto.

    

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

    

    (i)    this
      Agreement duly executed by such Purchaser;

    

    (ii)    such
      Purchaser’s Subscription Amount by wire transfer to the account as specified in
      writing by the Company; and

    

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

    

    2.3    Closing
      Conditions.

    

    (a)    The
      obligations of the Company hereunder in connection with the Closing are subject
      to the following conditions being met:

    

    (i)    the
      accuracy in all material respects when made and on the Closing Date of the
      representations and warranties of the Purchasers contained herein;

    

    (ii)    all
      obligations, covenants and agreements of the Purchasers required to be performed
      at or prior to the Closing Date shall have been performed; and

    

    (iii)    the
      delivery by the Purchasers of the items set forth in Section 2.2(b) of this
      Agreement.

    

    (b)    The
      respective obligations of the Purchasers hereunder in connection with the
      Closing are subject to the following conditions being met:

    

    (i)    the
      accuracy in all material respects on the Closing Date of the representations
      and
      warranties of the Company contained herein;

    

    (ii)    all
      obligations, covenants and agreements of the Company required to be performed
      at
      or prior to the Closing Date, as applicable, shall have been
      performed;

    

    (iii)    the
      delivery by the Company of the items set forth in Section 2.2(a) of this
      Agreement; and

     

    
      
        
        

      

      
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    (iv)    there
      shall have been no Material Adverse Effect with respect to the Company since
      the
      date hereof.

    

    ARTICLE
      III- REPRESENTATIONS AND WARRANTIES

    

    3.1    Representations
      and Warranties of the Company.
      The
      Company hereby makes the representations and warranties set forth below to
      each
      Purchaser.

    

    (a)    Subsidiaries.
       The Company owns, directly or indirectly, all of the capital stock or
      other equity interests of each Subsidiary free and clear of any Liens, and
      all
      the issued and outstanding shares of capital stock of each Subsidiary are
      validly issued and are fully paid, non-assessable and free of preemptive and
      similar rights to subscribe for or purchase securities.  

    

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

    

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

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

       

    

    (d)    No
      Conflicts.  
      The execution, delivery and performance of the Transaction Documents by the
      Company and the consummation by the Company of the other transactions
      contemplated hereby and thereby do not and will not: (i) conflict with or
      violate any provision of the Company’s or any Subsidiary’s certificate or
      articles of incorporation, bylaws or other organizational or charter documents,
      or (ii) conflict with, or constitute a default (or an event that with notice
      or
      lapse of time or both would become a default) under, result in the creation
      of
      any Lien upon any of the properties or assets of the Company or any Subsidiary,
      or give to others any rights of termination, amendment, acceleration or
      cancellation (with or without notice, lapse of time or both) of, any agreement,
      credit facility, debt or other instrument (evidencing a Company or Subsidiary
      debt or otherwise) or other understanding to which the Company or any Subsidiary
      is a party or by which any property or asset of the Company or any Subsidiary
      is
      bound or affected, or (iii) subject to the Required Approvals, conflict with
      or
      result in a violation of any law, rule, regulation, order, judgment, injunction,
      decree or other restriction of any court or governmental authority to which
      the
      Company or a Subsidiary is subject (including federal and state securities
      laws
      and regulations), or by which any property or asset of the Company or a
      Subsidiary is bound or affected; except in the case of each of clauses (ii)
      and
      (iii), such as could not have or reasonably be expected to result in a Material
      Adverse Effect.  

    

    (e)    Filings,
      Consents and Approvals.  The
      Company is not required to obtain any consent, waiver, authorization or order
      of, give any notice to, or make any filing or registration with, any court
      or
      other federal, state, local or other governmental authority or other Person
      in
      connection with the execution, delivery and performance by the Company of the
      Transaction Documents, other than (i) filings required pursuant to Form 8-K
      promulgated under the Exchange Act and (ii) the filing with the Commission
      of
      the Registration Statement, (collectively, the “Required
      Approvals”).

    

    (f)    Issuance
      of the Securities.  
      The Securities are duly authorized and, when issued and paid for in accordance
      with the applicable Transaction Documents, will be duly and validly issued,
      fully paid and nonassessable, free and clear of all Liens imposed by the Company
      other than restrictions on transfer provided for in the Transaction
      Documents.   The Underlying Shares, when issued in accordance with the
      terms of the Transaction Documents, will be validly issued, fully paid and
      nonassessable, free and clear of all Liens imposed by the Company.  
The Company has reserved from its duly authorized capital stock a number of
      shares of Common Stock for issuance of the Underlying Shares.

    

    (g)    Capitalization.
        The capitalization of the Company is as set forth in its most
      recently file periodic reports under the Exchange Act.  The Company has not
      issued any capital stock since its most recently filed periodic report under
      the
      Exchange Act, other than pursuant to the exercise of employee stock options
      under the Company’s stock option plans, exercise of options by consultants, the
      issuance of shares of Common Stock to employees under employment agreements
      or
      pursuant to the Company’s employee stock purchase plan and pursuant to the
      conversion or exercise of outstanding Common Stock Equivalents.  All
      of the outstanding shares of capital stock of the Company are validly issued,
      fully paid and nonassessable, have been issued in compliance with all federal
      and state securities laws, and none of such outstanding shares was issued in
      violation of any preemptive rights or similar rights to subscribe for or
      purchase securities.   No further approval or authorization of any
      stockholder, the Board of Directors of the Company or others is required for
      the
      issuance and sale of the Securities.   There are no stockholders
      agreements, voting agreements or other similar agreements with respect to the
      Company’s capital stock to which the Company is a party or, to the knowledge of
      the Company, between or among any of the Company’s
      stockholders.  

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

       

    

    (h)    Investment
      Company.  
      The Company is not, and is not an Affiliate of, and immediately after receipt
      of
      payment for the Securities, will not be or be an Affiliate of, an “investment
      company” within the meaning of the Investment Company Act of 1940, as
      amended.   The Company shall conduct its business in a manner so that
      it will not become subject to the Investment Company Act.

    

    (i)    Disclosure.  
      The Company confirms that neither it nor any other Person acting on its behalf
      has provided any of the Purchasers or their agents or counsel with any
      information that constitutes or might constitute material, nonpublic
      information.   The Company understands and confirms that the
      Purchasers will rely on the foregoing representations and covenants in effecting
      transactions in securities of the Company.   All disclosure provided
      to the Purchasers regarding the Company, its business and the transactions
      contemplated hereby furnished by or on behalf of the Company with respect to
      the
      representations and warranties made herein are true and correct with respect
      to
      such representations and warranties and do not contain any untrue statement
      of a
      material fact or omit to state any material fact necessary in order to make
      the
      statements made therein, in light of the circumstances under which they were
      made, not misleading.  

    

    (j)    General
      Solicitation.
      Neither
      the Company nor any person acting on behalf of the Company has offered or sold
      any of the Shares by any form of general solicitation or general advertising.
      The Company has offered the Shares for sale only to the Purchasers and certain
      other “accredited investors” within the meaning of Rule 501 under the Securities
      Act.

    

    Purchaser
      acknowledges that the Company does not make or has not made any representations
      or warranties with respect to the transactions contemplated other than those
      specifically set forth in this Section 3.1.

     

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

    

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

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

       

    

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

    

    (c)    Disclosure
      of Information.
      Purchaser carefully reviewed all filings made by the Company with the Commission
      as of the date of this Agreement and has received and carefully reviewed any
      information Purchaser has requested from the Company that Purchaser considers
      necessary or appropriate for deciding whether to acquire the Securities,
      including, without limitation, all material risk factors relating to the
      Company. Purchaser further represents that Purchaser has had ample opportunity
      to ask questions and receive answers from the Company concerning the information
      and the terms and conditions of the offering of the Securities and to obtain
      any
      additional information necessary to verify the accuracy of the information
      given
      to Purchaser. Purchaser is making its investment in the Company after having
      reviewed, analyzed, sought professional advice regarding, and fully
      understanding the risk, uncertainties, and liabilities associated with the
      Company. 

     

    (d)    Regulation
      S.

     

    (i)    Purchaser
      either has been duly formed and is validly existing as a corporation or other
      legal entity in good standing under the laws of its jurisdiction of
      incorporation set forth on the signature page to this Agreement or is an
      individual who is not a citizen or resident of the United States. Purchaser
      is
      not organized under the laws of the United States and is not a “U.S. Person” as
      that term is defined in Rule 902(o) of Regulation S.

     

    (ii)    Purchaser
      was not formed for the purpose of investing in Regulation S securities or for
      the purpose of investing in the Securities sold under this Agreement. Purchaser
      is not registered as an issuer under the Securities Act and is not required
      to
      be registered with the SEC under the Investment Company Act of 1940, as amended.
      Purchaser is entering into this Agreement and is participating in the offering
      of the Shares for its own account, and not on behalf of any U.S. Person as
      defined in Rule 902(o) of Regulation S.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

       

    

    (iii)    The
      Company has not made an offer to enter into this Agreement to Purchaser in
      the
      United States other than as permitted in the case of an account managed by
      a
      professional fiduciary resident in the United States within the meaning of
      Section 902(o)(2) of Regulation S. At the times of the offer and execution
      of
      this Agreement and, to the best knowledge of Purchaser, at the time the offering
      originated, Purchaser was located and resident outside the United States, other
      than as permitted in the case of an account managed by a professional fiduciary
      resident in the United States within the meaning of Section 902(o)(2) of
      Regulation S.

     

    (iv)    Neither
      Purchaser, nor any of its Affiliates, nor any person acting on its behalf or
      on
      behalf of any Affiliate has engaged or will engage in any activity undertaken
      for the purpose of, or that reasonably could be expected to have the effect
      of,
      conditioning the markets in the United States for the Shares or for any
      securities that are convertible into or exercisable for the common stock of
      the
      Company, including, but not limited to, effecting any sale or short sale of
      the
      Company’s securities through Purchaser or any of its Affiliates before the
      expiration of any restricted period contained in Regulation S. To the best
      knowledge of Purchaser, this Agreement and the transactions contemplated by
      it
      are not part of a plan or scheme to evade the registration provisions of the
      Securities Act, and Purchaser is purchasing the Shares for investment purposes.
      Purchaser and, to the best knowledge of Purchaser, each distributor, if any,
      participating in this offering of the Securities have agreed that they will
      neither offer nor sell any Securities before the date hereof and through the
      expiration of the any restricted period set forth in Rule 903 of Regulation
      S
      (as amended from time to time) to U.S. Persons or for the account or benefit
      of
      U.S. Persons, and they will offer or sell any of the Securities only in
      compliance with the provisions of Regulation S and any other applicable
      provisions of the Securities Act. Purchaser and its representatives have not
      conducted any Directed Selling Effort as that term is used and defined in Rule
      902 of Regulation S and will not engage in any Directed Selling Effort within
      the United States through the expiration of any restricted period set forth
      in
      Rule 903 of Regulation S.

     

    (v)    Purchaser
      acknowledges that following the expiration of any restricted period provided
      by
      Rule 903 of Regulation S, any interest in this Agreement or in the Securities
      sold may be resold within the jurisdiction of the United States or to U.S.
      Persons as defined in Rule 902(o) of Regulation S by or for the account of
      the
      parties only (i) pursuant to a registration statement under the Securities
      Act,
      or (ii) if applicable, pursuant to an exemption from registration for sales
      by a
      person other than an issuer, underwriter, or dealer as those terms are used
      in
      Section 4(1) and related provisions of the Securities Act and regulations or
      pursuant to another exemption from registration, only following the expiration
      of any restricted period (if applicable) required by Regulation S. Purchaser
      acknowledges that this Agreement and the Securities have not been registered
      under the Securities Act or qualified under state securities laws of the United
      States and that their transferability within the jurisdiction of the United
      States is restricted by the Securities Act as well as state laws. Purchaser
      acknowledges it has received a copy of Regulation S, is familiar with and
      understands its terms, and has had the opportunity to consult with its legal
      counsel concerning this Agreement and Regulation S.

     

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

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

       

    

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

    

    (g)    Short
      Sales and Confidentiality Prior To The Date Hereof.  Other
      than the transaction contemplated hereunder, such Purchaser has not directly
      or
      indirectly, nor has any Person acting on behalf of or pursuant to any
      understanding with such Purchaser, executed any disposition, including Short
      Sales, in the securities of the Company during the period commencing from
      the time that such Purchaser first received a term sheet from the Company or
      any
      other Person setting forth the material terms of the transactions contemplated
      hereunder until the date hereof. Notwithstanding the foregoing, in the case
      of a
      Purchaser that is a multi-managed investment vehicle whereby separate portfolio
      managers manage separate portions of such Purchaser's assets and the portfolio
      managers have no direct knowledge of the investment decisions made by the
      portfolio managers managing other portions of such Purchaser's assets, the
      representation set forth above shall only apply with respect to the portion
      of
      assets managed by the portfolio manager that made the investment decision to
      purchase the Securities covered by this Agreement.   Other than to
      other Persons party to this Agreement, such Purchaser has maintained the
      confidentiality of all disclosures made to it in connection with this
      transaction (including the existence and terms of this
      transaction).

     

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

    

    ARTICLE
      IV- OTHER AGREEMENTS OF THE PARTIES

    

    4.1    Transfer
      Restrictions.

    

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

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

       

    

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

    

      THIS
        DEBENTURE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933,
        AS
AMENDED
        (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN
        THE
        UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT
        AS
        SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
        THAT IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS DEBENTURE IN AN OFFSHORE
        TRANSACTION, (2) AGREES THAT
        IT
        WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS DEBENTURE RESELL
        OR OTHERWISE TRANSFER THIS DEBENTURE
        EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO AN
        EFFECTIVE REGISTRATION STATEMENT
        UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO A QUALIFIED
        INSTITUTIONAL BUYER IN COMPLIANCE WITH
        RULE
        144A UNDER THE SECURITIES ACT, (D) INSIDE THE UNITED STATES TO AN ACCREDITED
        INVESTOR THAT, PRIOR TO SUCH
        TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A UNITED STATES
        BROKER-DEALER) TO THE TRUSTEE A SIGNED
        LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
        RESTRICTIONS ON TRANSFER OF THIS DEBENTURE
        (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE), (E) OUTSIDE
        THE
        UNITED STATES IN AN OFFSHORE
        TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (F) PURSUANT
        TO ANY OTHER EXEMPTION FROM
        REGISTRATION UNDER THE SECURITIES ACT (IF AVAILABLE) AND (3) AGREES THAT
        IT WILL
        GIVE TO EACH PERSON TO WHOM THIS
        DEBENTURE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
        IN
        CONNECTION WITH ANY TRANSFER
        OF THIS DEBENTURE WITHIN TWO YEARS AFTER ORIGINAL ISSUANCE OF THIS DEBENTURE,
        IF
        THE PROPOSED TRANSFEREE IS
        AN
        ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO
        THE
        TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS,
        LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE
        TO
        CONFIRM THAT SUCH TRANSFER
        IS BEING MADE PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT SUBJECT
        TO
        THE REGISTRATION REQUIREMENTS
        OF THE SECURITIES ACT. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION,"
        "UNITED
        STATES" AND "U.S. PERSON"
        HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
        ACT.

    

    (c)    Certificates
      evidencing the Underlying Shares shall not contain any legend (including the
      legend set forth in Section 4.1(b) hereof): (i) while a registration statement
      (including the Registration Statement) covering the resale of such security
      is
      effective under the Securities Act, or (ii) following any sale of such
      Underlying Shares pursuant to Rule 144, or (iii) if such Underlying Shares
      are
      eligible for sale under Rule 144(k), or (iv) if such legend is not required
      under applicable requirements of the Securities Act (including judicial
      interpretations and pronouncements issued by the staff of the
      Commission).   

    

    If
      all or
      any portion of a Debenture is converted or exercised (as applicable) at a time
      when there is an effective registration statement to cover the resale of the
      Underlying Shares, or if such Underlying Shares may be sold under Rule 144(k)
      or
      if such legend is not otherwise required under applicable requirements of the
      Securities Act (including judicial interpretations thereof) then such Underlying
      Shares shall be issued free of all legends.  

    

    The
      Company agrees that following the Effective Date or at such time as such legend
      is no longer required under this Section 4.1(c), it will, no later than three
      Trading Days following the delivery by a Purchaser to the Company or the
      Company’s transfer agent of a certificate representing Underlying Shares, as
      applicable, issued with a restrictive legend, deliver or cause to be delivered
      to such Purchaser a certificate representing such shares that is free from
      all
      restrictive and other legends. The Company may not make any notation on its
      records or give instructions to any transfer agent of the Company that enlarge
      the restrictions on transfer set forth in this Section.

    

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

       

    

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

    

    4.2    Conversion
      Procedures.  
      The form of Notice of Conversion included in the Debentures set forth the
      totality of the procedures required of the Purchasers in order to convert the
      Debentures.   No additional legal opinion or other information or
      instructions shall be required of the Purchasers to convert their
      Debentures.   The Company shall honor conversions of the Debentures
      and shall deliver Underlying Shares in accordance with the terms, conditions
      and
      time periods set forth in the Transaction Documents.

    

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

    

    4.4    Use
      of
      Proceeds.  
      The Company shall use the net proceeds from the sale of the Securities hereunder
      substantially for the development of the French Gulch Mine.

    

    4.5    Reservation
      and Listing of Securities.  
      The Company shall maintain a reserve from its duly authorized shares of Common
      Stock for issuance pursuant to the Transaction Documents in such amount as
      may
      be required to fulfill its obligations in full under the Transaction
      Documents.

    

    4.6    Equal
      Treatment of Purchasers.  
      No consideration shall be offered or paid to any person to amend or consent
      to a
      waiver or modification of any provision of any of the Transaction Documents
      unless the same consideration is also offered to all of the parties to the
      Transaction Documents.   Further, the Company shall not make any
      payment of principal or interest on the Debentures in amounts which are
      disproportionate to the respective principal amounts outstanding on the
      Debentures at any applicable time.   For clarification purposes, this
      provision constitutes a separate right granted to each Purchaser by the Company
      and negotiated separately by each Purchaser, and is intended for the Company
      to
      treat the Purchasers as a class and shall not in any way be construed as the
      Purchasers acting in concert or as a group with respect to the purchase,
      disposition or voting of Securities or otherwise.

    

    4.7    Delivery
      of Securities after Closing. The Company will deliver, or cause to be delivered,
      the respective Shares and Warrants purchased by each Purchaser to the Purchaser
      within 3 Trading Days of the Closing Date.

     

    4.8    Resale
      by
      Purchaser. Each Purchaser understands and acknowledges, severally and not
      jointly with any other Purchaser, that the SEC takes the position that the
      coverage of short sales of shares of the Common Stock “against the box” before
      the Effective Date of the Registration Statement with the Shares is a violation
      of Section 5 of the Securities Act, as set forth in Item 65, Section 5 under
      Section A, of the Manual of Publicly Available Telephone Interpretations, dated
      July 1997, compiled by the Office of Chief Counsel, Division of Corporation
      Finance. Accordingly, no Purchaser will use any of the Shares to cover any
      short
      sales made before the Effective Date. Further, each Purchaser will comply with
      any obligations it may have under Regulation M with respect to the resale of
      the
      Securities.

     

    
      
        
        

      

      
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    ARTICLE
      V - MISCELLANEOUS

    

    5.1    Termination.  
      This Agreement may be terminated by any Purchaser, as to such Purchaser’s
      obligations hereunder only and without any effect whatsoever on the obligations
      between the Company and the other Purchasers, by written notice to the other
      parties, if the Closing has not been consummated on or before
      ___________________;
      provided,
      however,
      that no
      such termination will affect the right of any party to sue for any breach by
      the
      other party (or parties).

    

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

    

    5.3    Notices.  
      Any and all notices or other communications or deliveries required or permitted
      to be provided hereunder shall be in writing and shall be deemed given and
      effective on the earliest of (a) the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number set forth
      on
      the signature pages attached hereto prior to 5:30 p.m.  (Nevada time)
      on a Trading Day, (b) the next Trading Day after the date of transmission,
      if
      such notice or communication is delivered via facsimile at the facsimile number
      set forth on the signature pages attached hereto on a day that is not a Trading
      Day or later than 5:30 p.m.  (Nevada time) on any Trading Day, (c) the
      2nd Trading Day following the date of mailing, if sent by
      U.S.  nationally recognized overnight courier service, or (d) upon
      actual receipt by the party to whom such notice is required to be
      given.   The address for such notices and communications shall be as
      set forth on the signature pages attached hereto.

    

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

    

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

    

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

    

    5.7    No
      Third-Party Beneficiaries.  
      This Agreement is intended for the benefit of the parties hereto and their
      respective successors and permitted assigns and is not for the benefit of,
      nor
      may any provision hereof be enforced by, any other Person, except as otherwise
      set forth in Section 4.9.

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

       

    

    5.8    Governing
      Law.  All
      questions concerning the construction, validity, enforcement and interpretation
      of the Transaction Documents shall be governed by and construed and enforced
      in
      accordance with the internal laws of the State of Nevada, without regard to
      the
      principles of conflicts of law thereof.   Each party agrees that all
      legal proceedings concerning the interpretations, enforcement and defense of
      the
      transactions contemplated by this Agreement and any other Transaction Documents
      (whether brought against a party hereto or its respective affiliates, directors,
      officers, shareholders, employees or agents) shall be commenced exclusively
      in
      the state and federal courts sitting in the City of Reno.   Each party
      hereby irrevocably submits to the exclusive jurisdiction of the state and
      federal courts sitting in the City of Reno, State of Nevada for the adjudication
      of any dispute hereunder or in connection herewith or with any transaction
      contemplated hereby or discussed herein (including with respect to the
      enforcement of any of the Transaction Documents), and hereby irrevocably waives,
      and agrees not to assert in any suit, action or proceeding, any claim that
      it is
      not personally subject to the jurisdiction of any such court, that such suit,
      action or proceeding is improper or inconvenient venue for such
      proceeding.   

    

    Each
      party hereby irrevocably waives personal service of process and consents to
      process being served in any such suit, action or proceeding by mailing a copy
      thereof via registered or certified mail or overnight delivery (with evidence
      of
      delivery) to such party at the address in effect for notices to it under this
      Agreement and agrees that such service shall constitute good and sufficient
      service of process and notice thereof.   Nothing contained herein
      shall be deemed to limit in any way any right to serve process in any manner
      permitted by law.   The parties hereby waive all rights to a trial by
      jury.   If either party shall commence an action or proceeding to
      enforce any provisions of the Transaction Documents, then the prevailing party
      in such action or proceeding shall be reimbursed by the other party for its
      attorneys’ fees and other costs and expenses incurred with the investigation,
      preparation and prosecution of such action or proceeding.

    

    5.9    Survival.  
      The representations and warranties contained herein shall survive the Closing
      and the delivery, exercise and/or conversion of the Securities for one
      year.

     

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

    

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

    

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

    

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

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

    

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

    

    5.15             Usury.  
      To the extent it may lawfully do so, the Company hereby agrees not to insist
      upon or plead or in any manner whatsoever claim, and will resist any and all
      efforts to be compelled to take the benefit or advantage of, usury laws wherever
      enacted, now or at any time hereafter in force, in connection with any claim,
      action or proceeding that may be brought by any Purchaser in order to enforce
      any right or remedy under any Transaction Document.   Notwithstanding
      any provision to the contrary contained in any Transaction Document, it is
      expressly agreed and provided that the total liability of the Company under
      the
      Transaction Documents for payments in the nature of interest shall not exceed
      the maximum lawful rate authorized under applicable law (the “Maximum
      Rate”),
      and,
      without limiting the foregoing, in no event shall any rate of interest or
      default interest, or both of them, when aggregated with any other sums in the
      nature of interest that the Company may be obligated to pay under the
      Transaction Documents exceed such Maximum Rate.  It is agreed that if
      the maximum contract rate of interest allowed by law and applicable to the
      Transaction Documents is increased or decreased by statute or any official
      governmental action subsequent to the date hereof, the new maximum contract
      rate
      of interest allowed by law will be the Maximum Rate applicable to the
      Transaction Documents from the effective date forward, unless such application
      is precluded by applicable law.  If under any circumstances
      whatsoever, interest in excess of the Maximum Rate is paid by the Company to
      any
      Purchaser with respect to indebtedness evidenced by the Transaction Documents,
      such excess shall be applied by such Purchaser to the unpaid principal balance
      of any such indebtedness or be refunded to the Company, the manner of handling
      such excess to be at such Purchaser’s election.

    

    5.16             
      Independent
      Nature of Purchasers’ Obligations and Rights.  
      The obligations of each Purchaser under any Transaction Document are several
      and
      not joint with the obligations of any other Purchaser, and no Purchaser shall
      be
      responsible in any way for the performance of the obligations of any other
      Purchaser under any Transaction Document.   Nothing contained herein
      or in any Transaction Document, and no action taken by any Purchaser pursuant
      thereto, shall be deemed to constitute the Purchasers as a partnership, an
      association, a joint venture or any other kind of entity, or create a
      presumption that the Purchasers are in any way acting in concert or as a group
      with respect to such obligations or the transactions contemplated by the
      Transaction Documents.   Each Purchaser shall be entitled to
      independently protect and enforce its rights, including without limitation
      the
      rights arising out of this Agreement or out of the other Transaction Documents,
      and it shall not be necessary for any other Purchaser to be joined as an
      additional party in any proceeding for such purpose.   Each Purchaser
      has been represented by its own separate legal counsel in their review and
      negotiation of the Transaction Documents.   

    

    5.17                
      Construction.  
      The parties agree that each of them and/or their respective counsel has reviewed
      and had an opportunity to revise the Transaction Documents and, therefore,
      the
      normal rule of construction to the effect that any ambiguities are to be
      resolved against the drafting party shall not be employed in the interpretation
      of the Transaction Documents or any amendments hereto.

    

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

       

    
      	
              BULLION RIVER GOLD CORP.
                INC.

               

              
                By:      
                  /s/ Peter M.
                  Kuhn                                              

                    
Name:
                  Peter M. Kuhn

                      
Title:
                  President

              

            	
              Address for Notice:

              
                 

                3500
                  Lakeside Court, Suite 200

                Reno,
                  Nevada 89509

                (775)
                  324-4881

              

            

    

      

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

       

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

       

      ___________________________________________________________________________________________________________________________________________

    

     

    
 

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    [PURCHASER
      SIGNATURE PAGES TO BULLION RIVER GOLD CORP., INC. SECURITIES PURCHASE
      AGREEMENT]

    
       

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

    

    Name
      of
      Purchaser:
      __________________________________________________________________________________________________________________________ 

    

    

    Signature
      of Authorized Signatory of Purchaser:____________________________________________________________________________________________________
      

    Name
      of
      Authorized
      Signatory:__________________________________________________________________________________________________________________ 

    Title
      of
      Authorized
      Signatory:___________________________________________________________________________________________________________________
       

    Email
      Address of
      Purchaser:____________________________________________________________________________________________________________________  

    

    Address
      for Notice of
      Purchaser:_________________________________________________________________________________________________________________  

    _________________________________________________________________________________________________________________________

     

    Address
      for Delivery of Securities for Purchaser (if not same as above):
      ____________________________________________________________________________________ 

    _________________________________________________________________________________________________________________________

    

    Principal
      Amount:
      $___________________________________________________________________________________________________________________________ 

    Warrant
      Shares:______________________________________________________________________________________________________________________________
       

    

     

    

    [SIGNATURE
      PAGES CONTINUE]

     

    
 

    17

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