Document:

Form of Stock Purchase Warrant

NEITHER THIS WARRANT NOR ANY OF THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAW.  NO TRANSFER OF THIS WARRANT OR OF THE SECURITIES ISSUABLE UPON EXERCISE HEREOF SHALL BE VALID OR EFFECTIVE UNLESS (A) SUCH TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAW, OR (B) THE HOLDER SHALL DELIVER TO THE COMPANY AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND OF ANY APPLICABLE STATE SECURITIES LAW.

Warrant No. _______

[Date]

SMARTE SOLUTIONS, INC.

STOCK PURCHASE WARRANT

Smarte Solutions, Inc., a Delaware corporation (the “Company”), hereby grants to [Holder Name] (together with its registered assignee or transferee being referred to herein as the “Holder”) the right to purchase, at any time and from time to time on and after the earlier of (i) immediately prior to the consummation of the Public Offering (as defined below) or (ii)  until the Expiration Date (as defined below), up to that number of fully paid and nonassessable shares of the Common Stock of the Company, par value $0.001 per share (the “Common Stock”) as determined by taking seven (7%) of the principal amount of that certain Subordinated Promissory Note, dated as of even date herewith, by and between the Holder and the Company (the “Note”) divided by the Exercise Price (as defined in Section 1.1 below).  As used herein, the term “Public Offering” shall mean the best efforts commitment underwritten public offering of the Company’s Common Stock under the Securities Act of 1933, as amended, with a price per share of at least $.36 (subject to adjustment for stock splits, stock dividends, reclassifications and the like) and gross proceeds to the Company and any selling stockholder of not less than $2.5 million in the aggregate.  In the event of a Public Offering, the Company shall take all necessary steps to include the shares of Common Stock issuable to the Holder upon the exercise of this Warrant in the registration statement filed by the Company with the Securities and Exchange Commission pursuant to which shares of the Company’s Common Stock are offered and sold.

This Stock Purchase Warrant (hereinafter, this “Warrant”) shall expire and be of no further force or effect upon the earliest of (i) the third anniversary of the date hereof, (ii) twelve (12) months following the consummation of a best efforts commitment, underwritten public offering, (iii) the sale of all or substantially all of the Company’s assets, or (iv) immediately prior to any merger or consolidation of the Company in which the Company is not the surviving entity (the earliest of such events being the “Expiration Date”); provided that the Company shall give notice to the Holder at least 20 days prior to the events set forth in clauses (ii) through (iv).  This Warrant is being issued pursuant to the terms of a Bridge Loan Agreement by and between the Company and the Holder (the “Bridge Loan Agreement”).

Section 1.

Exercise and Vesting of Warrant.

1.1.

Exercise; Vesting.  Subject to adjustment as hereinafter provided, the rights represented by this Warrant are exercisable on and after the earlier of (i) twelve (12) months following the date of the Public Offering or (ii)  until the Expiration Date (the “Exercise Date”), at a price (the “Exercise Price”) per share equal to $0.50.  The Exercise Price shall be payable in cash, or by certified or official bank check.  This Warrant is fully vested.  

1.2.

Delivery of Certificate.  Upon surrender of this Warrant with a duly executed Notice of Exercise in the form of Annex A attached hereto, together with payment of the Exercise Price for the Warrant Shares purchased, at the Company’s principal executive offices presently located at _______________________________________________________, or at such other address as the Company shall have advised the Holder in writing (the “Designated Office”), the Holder shall be entitled to receive a certificate or certificates for the Warrant Shares so purchased.  The Company agrees that the Warrant Shares shall be deemed to have been issued to the Holder as of the close of business on the date on which this Warrant shall have been surrendered together with the Notice of Exercise and payment for such Warrant Shares.

Section 2.

Transfer; Issuance of Stock Certificates; Restrictive Legends.

2.1.

Transfer.  Subject to compliance with the restrictions on transfer set forth in this Warrant and in the Bridge Loan Agreement, each transfer of this Warrant and all rights hereunder, in whole or in part, shall be registered on the books of the Company to be maintained for such purpose, upon surrender of this Warrant at the Designated Office, together with a written assignment of this Warrant in the form of Annex B attached hereto duly executed by the Holder or its agent or attorney.  Upon such surrender and delivery, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, if any.  A Warrant, if properly assigned in compliance with the provisions hereof, may be exercised by the new Holder for the purchase of Warrant Shares without having a new Warrant issued.  Prior to due presentment for registration of transfer thereof, the Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof (notwithstanding any notations of ownership or writing thereon made by anyone other than a duly authorized officer of the Company) for all purposes and shall not be affected by any notice to the contrary.  All Warrants issued upon any assignment of Warrants shall be the valid obligations of the Company, evidencing the same rights, and entitled to the same benefits as the Warrants surrendered upon such registration of transfer or exchange.  Notwithstanding the foregoing, the Holder hereof may not transfer rights to any subsequent Holder who is not a Major Purchaser (as defined below) without the prior written consent of the Company, which consent shall not be unreasonably withheld.  As used herein, the term “Major Purchaser” shall mean any person who, originally or as a result of the transaction, assignment or transfer, owns in the aggregate at least 250,000 shares of Preferred Stock and/or Common Stock of the Company (as adjusted for any stock split, combination, reclassification or other similar event).

2.2.

Stock Certificates.  Certificates for the Warrant Shares shall be delivered to the Holder within a reasonable time after the rights represented by this Warrant shall have been exercised pursuant to Section 1, and a new Warrant representing the shares of Common Stock, if any, with respect to which this Warrant shall not then have been exercised shall also be issued to the Holder within such time.  The issuance of certificates for Warrant Shares upon the exercise of this Warrant shall be made without charge to the Holder hereof including, without limitation, any documentary, stamp or similar tax that may be payable in respect thereof; provided, however, that the Company shall not be required to pay any income tax to which the Holder hereof may be subject in connection with the issuance of this Warrant or the Warrant Shares; and provided further, that if Warrant Shares are to be delivered in a name other than the name of the Holder hereof representing any Warrant being exercised, then no such delivery shall be made unless the person requiring the same has paid to the Company the amount of transfer taxes or charges incident thereto, if any.

2.3.

Restrictive Legends. 

(a)

Except as otherwise provided in this Section 2, each certificate for Warrant Shares initially issued upon the exercise of this Warrant, and each certificate for Warrant Shares issued to any subsequent transferee of any such certificate, shall be stamped or otherwise imprinted with a legend in substantially the following form:

“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAW.  NO TRANSFER OF THE SHARES REPRESENTED BY THIS CERTIFICATE SHALL BE VALID OR EFFECTIVE UNLESS (A) SUCH TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS, OR (B) THE HOLDER SHALL DELIVER TO THE COMPANY AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE COMPANY THAT SUCH PROPOSED TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND OF ANY APPLICABLE STATE SECURITIES LAWS.”

(b)

Except as otherwise provided in this Section 2, each Warrant shall be stamped or otherwise imprinted with a legend in substantially the following form:

“NEITHER THIS WARRANT NOR ANY OF THE SECURITIES ISSUABLE UPON EXERCISE THEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAW, NO TRANSFER OF THIS WARRANT OR OF THE SECURITIES ISSUABLE UPON EXERCISE HEREOF SHALL BE VALID OR EFFECTIVE UNLESS (A) SUCH TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAW, OR (B) THE HOLDER SHALL DELIVER TO THE COMPANY AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND OF ANY APPLICABLE STATE SECURITIES LAW.”

Notwithstanding the foregoing, the legend requirements of this Section 2 shall terminate as to any particular Warrant or Warrant Share when the Company shall have received from the Holder thereof an opinion of counsel in form and substance reasonably acceptable to the Company that such legend is not required in order to ensure compliance with the Securities Act.  Whenever the restrictions imposed by this Section 2 shall terminate, the Holder hereof or of Warrant Shares, as the case may be, shall be entitled to receive from the Company without cost to such Holder a new Warrant or certificate for Warrant Shares of like tenor, as the case may be, without such restrictive legend.

Section 3.

Adjustment of Number of Shares; Exercise Price; Nature of Securities lssuable Upon Exercise of Warrants.

3.1.

Exercise Price; Adjustment of Number of Shares.  The Exercise Price set forth in Section 1 hereof and the number of shares purchasable hereunder shall be subject to adjustment from time to time as hereinafter provided.

(a)

Reclassification, etc.  If the Company, at any time while this Warrant, or any portion thereof, remains outstanding and unexpired, shall, by the reclassification or exchange of securities or otherwise, change any of the securities as to which purchase rights under this Warrant exist into the same or a different number of securities of any other class or classes, this Warrant shall thereafter represent the right to acquire such number and kind of securities as would have been issuable as the result of such change with respect to the securities that were subject to the purchase rights under this Warrant immediately prior to such reclassification, exchange, or other change and the Exercise Price therefor shall be appropriately adjusted, all subject to further adjustment as provided in this Section 3. 

(b)

Stock Splits, Stock Dividends and Reverse Stock Splits.  In case at any time the Company shall split or subdivide the outstanding shares of Common Stock into a greater number of shares, or shall declare and pay any stock dividend with respect to its outstanding stock that has the effect of increasing the number of outstanding shares of Common Stock, the Exercise Price in effect immediately prior to such subdivision or stock dividend shall be proportionately reduced and the number of Warrant Shares purchasable pursuant to this Warrant immediately prior to such subdivision or stock dividend shall be proportionately increased, and conversely, in case at any time the Company shall combine its outstanding shares of Common Stock into a smaller number of shares, the Exercise Price in effect immediately prior to such combination shall be proportionately increased and the number of Warrant Shares purchasable upon the exercise of this Warrant immediately prior to such combination shall be proportionately reduced.

(c)

Adjustments for Dividends in Stock or Other Securities of Property.  If while this Warrant, or any portion hereof, remains outstanding and unexpired the Holder of the securities as to which purchase rights under this Warrant exist at the time shall have received, or, on or after the record date fixed for the determination of eligible stockholders, shall have become entitled to receive, without payment therefor, other or additional stock or other securities or property (other than cash) of the Company by way of dividend, then and in each case, this Warrant shall represent the right to acquire, in addition to the number of shares of the security receivable upon exercise of this Warrant, and without payment of any additional consideration therefor, the amount of such other or additional stock or other securities or property of the Company that such Holder would hold on the date of such exercise had it been the Holder of record of the security receivable upon exercise of this Warrant on the date hereof and had thereafter, during the period from the date hereof to and including the date of such exercise, retained such shares and/or all other additional stock available by it as aforesaid during such period, giving effect to all adjustments called for during such period by the provisions of this Section 3.

3.2.

Timing of Exercise Price Adjustment.  No adjustment of the Exercise Price shall be made unless such adjustment would require an increase or decrease of at least $0.35 in such price; provided that any adjustments which by reason of this Section 3.2 are not required to be made shall be carried forward and shall be made at the time of and together with the next subsequent adjustment which, together with any adjustment(s) so carried forward, shall require an increase or decrease of at least $0.05 in the Exercise Price then in effect hereunder.

3.3.

Accountant’s Certificate.  In each case of an adjustment in the Exercise Price, number of Warrant Shares or other stock, securities or property receivable upon the exercise of this Warrant, the Company shall compute, and upon the Holder’s request shall at the Company’s expense cause the Company’s independent public accountants to certify such computation in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment and showing in detail the facts upon which such adjustment is based, including a statement of (i) the number of shares of Common Stock of each class outstanding or deemed to be outstanding, (ii) the adjusted Exercise Price and (iii) the number of Warrant Shares issuable upon exercise of this Warrant.  The Company will forthwith mail a copy of each such certificate to the Holder hereof.  In the event that the Holder disputes such adjustment, the Holder shall be entitled to select an additional firm of independent certified public accountants of national standing and paid for by the Holder to certify such adjustment and the Company and the Holder shall use their good faith best efforts to agree on such adjustment based on the reports of the two accounting firms.  In the event that the Company and the Holder are still unable to reach agreement as to such adjustment, the Company and the Holder agree to submit such determination to binding arbitration.  Upon determination of such adjustment, the Board of Directors shall forthwith make the adjustments described therein.

Section 4.

Registration; Exchange and Replacement of Warrant; Reservation of Shares.

The Company shall keep at the Designated Office a register in which the Company shall provide for the registration, transfer and exchange of this Warrant.  The Company shall not at any time, except upon the dissolution, liquidation or winding-up of the Company, close such register so as to result in preventing or delaying the exercise or transfer of this Warrant.

The Company may deem and treat the person in whose name this Warrant is registered as the Holder and owner hereof for all purposes and shall not be affected by any notice to the contrary, until presentation of this Warrant for registration or transfer as provided in this Section 4.

Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant and (in case of loss, theft or destruction) of indemnity satisfactory to it, and (in the case of mutilation) upon surrender and cancellation of this Warrant, the Company will (in the absence of notice to the Company that the Warrant has been acquired by a bona fide purchaser) make and deliver a new Warrant of like tenor, in lieu of this Warrant without requiring the posting of any bond or the giving of any security.

The Company shall at all times reserve and keep available out of its authorized shares of Common Stock, solely for the purpose of issuance upon the exercise of this Warrant, such number of shares of Common Stock as shall be issuable upon the exercise hereof.  The Company covenants and agrees that, upon exercise of this Warrant and payment of the Exercise Price therefor, if applicable, all Warrant Shares issuable upon such exercise shall be duly and validly issued, fully paid and non-assessable.

Section 5.

Fractional Warrants and Fractional Shares.

If the number of Warrant Shares purchasable upon the exercise of this Warrant is adjusted pursuant to Section 3 hereof, the Company shall nevertheless not be required to issue fractions of shares, upon exercise of this Warrant or otherwise, or to distribute certificates that evidence fractional shares.  With respect to any fraction of a share called for upon any exercise hereof, the Company shall pay to the Holder an amount in cash equal to such fraction multiplied by the current market value of such fractional share as may be prescribed by the Board of Directors of the Company.

Section 6.

Warrant Holders Not Deemed Stockholders.

No Holder of this Warrant shall, as such, be entitled to vote or to receive dividends or be deemed the Holder of Warrant Shares that may at any time be issuable upon exercise of this Warrant for any purpose whatsoever, nor shall anything contained herein be construed to confer upon the Holder of this Warrant, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action (whether upon any recapitalization, issue or reclassification of stock, change of par value or change of stock to no par value, consolidation, merger or conveyance or otherwise), or to receive notice of meetings, or to receive dividends or subscription rights, until such Holder shall have exercised this Warrant and been issued Warrant Shares in accordance with the provisions hereof.

Section 7.

Notices.

All notices, requests, consents and other communications hereunder shall be in writing and shall be deemed to have been duly made when delivered personally, or mailed by registered or certified mail, return receipt requested, or telecopied or telexed and confirmed in writing and delivered personally or mailed by registered or certified mail, return receipt requested (a) if to the Holder of this Warrant, to the address of such Holder as shown on the books of the Company, or (b) if to the Company, to the address set forth in Section 1.2 of this Warrant; or at such other address as the Holder or the Company may hereafter have advised the other.

Section 8.

Successors.

All the covenants, agreements, representations and warranties contained in this Warrant shall bind the parties hereto and their respective heirs, executors, administrators, distributees, successors, assigns and transferees.

Section 9.

Law Governing.

THIS WARRANT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF.

Section 10.

Entire Agreement; Amendments and Waivers.

This Warrant is one of a series of warrants (the “Bridge Warrants”) to be issued in connection with the subordinated promissory notes (the “Bridge Notes”) to be issued pursuant to the Bridge Loan Agreement.  None of the Bridge Warrants, nor any term thereof, may be amended, waived, discharged or terminated except by a written instrument signed by the Company and the holders of Bridge Notes representing at least 50% of the aggregate outstanding principal amounts under the Bridge Notes, and any such amendment, waiver, discharge or termination shall be binding on all of the holders of Warrants.

Section 11.

Severability; Headings.

If any term of this Warrant as applied to any person or to any circumstance is prohibited, void, invalid or unenforceable in any jurisdiction, such term shall, as to such jurisdiction, be ineffective to the extent of such prohibition or invalidity without in any way affecting any other term of this Warrant or affecting the validity or enforceability of this Warrant or of such provision in any other jurisdiction.  The section headings in this Warrant have been inserted for purposes of convenience only and shall have no substantive effect.

[Signature Page Follows]

 

IN WITNESS WHEREOF, the Company has caused this Stock Purchase Warrant to be duly executed as of the date first written above. 

SMARTE SOLUTIONS, INC.

By:  /s/ BALA VISHWANATH

Print Name:  Bala Vishwanath, CEO

ANNEX A

NOTICE OF EXERCISE

(To be executed upon partial or full

exercise of this Warrant)

The undersigned hereby irrevocably elects to exercise the right to purchase shares of Common Stock of Smarte Solutions, Inc. covered by this Warrant according to the conditions hereof and herewith makes payment of the Exercise Price of such shares in full in the amount of $______________.

By:  

(Signature of Registered Holder)

Dated:  

ANNEX B

ASSIGNMENT FORM

FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby sells, assigns and transfers unto the Assignee named below all of the rights of the undersigned under this Warrant, with respect to the number of shares of Common Stock set forth below:

	

Name and Address of Assignee

	No. of Shares of Common Stock

	 	 
	 	 

and does hereby irrevocably constitute and appoint _______________________ attorney-in-fact to register such transfer onto the books of Smarte Solutions, Inc. maintained for the purpose, with full power of substitution in the premises.

Dated:  

Print Name:  

Signature:  

Witness:  

NOTICE:

The signature on this assignment must correspond with the name as written upon the face of this Warrant in every particular, without alteration or enlargement or any change whatsoever.

 

 

 

 

 

 

 

 

COMMON STOCK PURCHASE WARRANT HOLDERS

	Name

	Date

	Amount

	Warrants

	Warrant Exp

	Warrant Value

	
  Scott McAllister

	
  6/28/04

	
  $75,000.00

	
  10500

	
  6/28/05

	
  $5,250.00

	
  Jerry D. Simmons

	
  6/28/04

	
  $50,000.00

	
  7000

	
  6/28/05

	
  $3,500.00

	
  Randy Weiss

	
  6/29/04

	
  $150,000.00

	
  21000

	
  6/29/05

	
  $10,500.00

	
  Shelly & Shane Phillips

	
  6/30/04

	
  $25,000.00

	
  3500

	
  6/30/05

	
  $1,750.00

	
  Alice & Don Frenk

	
  6/30/04

	
  $27,000.00

	
  3780

	
  6/30/05

	
  $1,890.00

	
  John B. Hall

	
  6/30/04

	
  $25,000.00

	
  3500

	
  6/30/05

	
  $1,750.00

	
  Michael J. Blackwell

	
  7/6/04

	
  $50,000.00

	
  7000

	
  7/6/05

	
  $3,500.00

	
  Gregory Brown

	
  7/7/04

	
  $30,000.00

	
  4200

	
  7/7/05

	
  $2,100.00

	
  Agincourt, LLC

	
  7/7/04

	
  $100,000.00

	
  14000

	
  7/7/05

	
  $7,000.00

	
  Renata I. Krajnik

	
  7/7/04

	
  $10,000.00

	
  1400

	
  7/7/05

	
  $700.00

	
  Tracy Sharp

	
  7/7/04

	
  $40,000.00

	
  5600

	
  7/7/05

	
  $2,800.00

	
  Charles M. Gray

	
  7/8/04

	
  $50,000.00

	
  7000

	
  7/8/05

	
  $3,500.00

	
  Peter John Bagnall

	
  7/8/04

	
  $25,000.00

	
  3500

	
  7/8/05

	
  $1,750.00

	
  Azar Computer

	
  7/9/04

	
  $25,000.00

	
  3500

	
  7/9/05

	
  $1,750.00

	
  Thomas G. Reagan

	
  7/9/04

	
  $50,000.00

	
  7000

	
  7/9/05

	
  $3,500.00

	
  Judith Eifert Beck

	
  7/9/04

	
  $25,000.00

	
  3500

	
  7/9/05

	
  $1,750.00

	
  Richard Gift

	
  7/9/04

	
  $25,000.00

	
  3500

	
  7/9/05

	
  $1,750.00

	
  Greg Sparks

	
  7/9/04

	
  $75,000.00

	
  10500

	
  7/9/05

	
  $5,250.00

	
  Paul Foreman

	
  7/14/04

	
  $100,000.00

	
  14000

	
  7/14/05

	
  $7,000.00

	
  Ron Bowling

	
  7/16/04

	
  $50,000.00

	
  7000

	
  7/16/05

	
  $3,500.00

	
  Sherry Ellenbogen

	
  7/19/04

	
  $50,000.00

	
  7000

	
  7/19/05

	
  $3,500.00

	
  Mary Ann Thompson Frenk F Trust

	
  7/21/04

	
  $500,000.00

	
  70000

	
  7/21/05

	
  $35,000.00

	
  Carl Kleimann

	
  7/22/04

	
  $10,000.00

	
  1400

	
  7/22/05

	
  $700.00

	
  Odyssey Marketing Group

	
  7/22/04

	
  $50,000.00

	
  7000

	
  7/22/05

	
  $3,500.00

	
  Dorchie Ferrell

	
  7/22/04

	
  $50,000.00

	
  7000

	
  7/22/05

	
  $3,500.00

	
  Wayne Parkman

	
  7/27/04

	
  $75,000.00

	
  10500

	
  7/27/05

	
  $5,250.00

	
  Sue Hardy

	
  7/27/04

	
  $25,000.00

	
  3500

	
  7/27/05

	
  $1,750.00

	
  Sequel Properties 

	
  7/28/04

	
  $100,000.00

	
  14000

	
  7/28/05

	
  $7,000.00

	
  Gregory Wolski

	
  7/29/04

	
  $10,000.00

	
  1400

	
  7/29/05

	
  $700.00

	
  Ali Gallagher

	
  8/3/04

	
  $100,000.00

	
  14000

	
  8/3/05

	
  $7,000.00

	
  Celia Martin

	
  8/3/04

	
  $20,000.00

	
  2800

	
  8/3/05

	
  $1,400.00

	
  Richard L. Hunter, Jr

	
  8/3/04

	
  $50,000.00

	
  7000

	
  8/3/05

	
  $3,500.00

	
  Michael & Kimberly Kline

	
  8/5/04

	
  $25,000.00

	
  3500

	
  8/5/05

	
  $1,750.00

	
  Michael Mcauliffe

	
  8/5/04

	
  $38,822.29

	
  5436

	
  8/5/05

	
  $2,718.00

	
  Chanan Seneewongs 

	
  8/6/04

	
  $25,000.00

	
  3500

	
  8/6/05

	
  $1,750.00

	
  Vicki Frenk

	
  8/9/04

	
  $10,000.00

	
  1400

	
  8/9/05

	
  $700.00

	
  William & Elizabeth Race

	
  8/11/04

	
  $25,000.00

	
  3500

	
  8/11/05

	
  $1,750.00

	
  Kevin McAuliffe

	
  8/13/04

	
  $24,684.80

	
  3456

	
  8/13/05

	
  $1,728.00

	
  Timothy Glass

	
  8/13/04

	
  $15,000.00

	
  2100

	
  8/13/05

	
  $1,050.00

	
  M. Marcus Malinak

	
  8/17/04

	
  $19,343.05

	
  2709

	
  8/17/05

	
  $1,354.50

	
  Eric Sutherland

	
  8/19/04

	
  $25,000.00

	
  3500

	
  8/19/05

	
  $1,750.00

	
  Michael Craddock

	
  8/20/04

	
  $50,000.00

	
  7000

	
  8/20/05

	
  $3,500.00

	
  Bob Allison

	
  8/23/04

	
  $100,000.00

	
  14000

	
  8/23/05

	
  $7,000.00

	
  Manuel Coats

	
  8/24/04

	
  $25,000.00

	
  3500

	
  8/24/05

	
  $1,750.00

	
  TOTAL

	
   

	
  $2,429,850.14

	
  340181

	
   

	
  $170,090.50Form of Bridge Loan Agreement

BRIDGE LOAN AGREEMENT

By this
BRIDGE LOAN AGREEMENT dated as of [_________] (this “Agreement”), the undersigned (the “Lenders”) and Smarte Solutions, Inc., a Delaware corporation (the “Borrower”), hereby agree as follows:

1.

Offer and Tender.  The Lenders hereby agree to loan to the Borrower, the amount set forth on Schedule I attached hereto through a Bridge Loan (the “Bridge”) as evidenced by the issuance of a Subordinated Promissory Note dated as of even date herewith (the “Note”), in a financing by the Borrower (the “Bridge Financing”).  The obligations evidenced by the Bridge shall be secured pursuant to the form of a Security Agreement in substantially the form attached hereto as Exhibit A (the “Security Agreement”).

2.

Representations, Warranties and Covenants.  Each Lender hereby represents, warrants and covenants to the Borrower that:

(a)

Authorization.  Such Lender has full power and authority to enter into this Agreement, and such Agreement constitutes such Lender’s valid and legally binding obligation, enforceable in accordance with its terms.

(b)

Loan Entirely for Own Account.  This Agreement is made with such Lender in reliance upon such Lender’s representation to the Borrower, which by its execution of this Agreement, it hereby confirms, that the Bridge Loan will be made for its own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that it has no present intention of selling, granting any participation in, or otherwise distributing the same.  By executing this Agreement, such Lender further represents that it does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to such person or to any third person, with respect to any of the Bridge Loan.

(c)

Disclosure of Information.  Such Lender believes it has received all the information it considers necessary or appropriate for deciding whether to participate in the Bridge Loan.  Such Lender further represents that it has had an opportunity to ask questions and receive answers from the Borrower regarding the terms and conditions of the Bridge Financing, properties and financial condition of the Borrower.

(d)

Investment Experience.  Such Lender is an investor in securities of companies in the development stage and acknowledges that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of participating in the Bridge Financing.  Such Lender also represents that it has not been organized for the purpose of participating in the Bridge Financing.

(e)

Accredited Investor.  Such Lender is an “accredited investor” within the meaning of Securities and Exchange Commission (“SEC”) Rule 501 of Regulation D, as presently in effect, and as indicated by Lender’s certification on Exhibit “B” attached hereto and incorporated by reference herein for all purposes.

(f)

Restricted Securities.  Such Lender understands that the Bridge, theNote and the shares of common stock underlying the Warrants it is receiving by way of the terms of the Bridge Financing (as defined in EXHIBIT C, the “Stock Purchase Warrant”) and (collectively the “Securities”) are characterized as “restricted securities” under the federal securities laws inasmuch as they are being acquired from the Borrower in a transaction not involving a public offering and that under such laws and applicable regulations such Securities may be resold without registration only in certain limited circumstances.  In this connection, such Lender represents that it is familiar with SEC Rule 144, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act of 1933, as amended (the “Securities Act”).  The securities underlying the warrants shall contain “piggy back” registration rights allowing them to become freely tradable shares without restriction.

(g)

Further Limitations on Disposition.  Without in any way limiting the representations set forth above, such Lender further agrees not to make any disposition of all or any portion of the Securities unless and until:

(i)

There is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with such registration statement; or

(ii)

(A) Such Lender shall have notified and received the consent of the Borrower of the proposed disposition and shall have furnished the Borrower with a detailed statement of the circumstances surrounding the proposed disposition, and (B) if reasonably requested by the Borrower, such Lender shall have furnished the Borrower with an opinion of counsel, reasonably satisfactory to the Borrower that such disposition will not require registration of such Securities under the Securities Act.  It is agreed that the Borrower will not require opinions of counsel for transactions made pursuant to Rule 144 except in unusual circumstances.

(iii)

Notwithstanding the provisions of paragraphs (i) and (ii) above, no such registration statement or opinion of counsel shall be necessary for a transfer by a Lender, if it is a partnership, to another partnership that is affiliated with the transferring partnership or to a partner of such transferring partnership or a retired partner of such partnership who retires after the date hereof, or to the estate of any such partner or retired partner or the transfer by gift, will or intestate succession of any partner to his or her spouse or to the siblings, lineal descendants or ancestors of such partner or his or her spouse, if the transferee agrees in writing to be subject to the terms hereof to the same extent as if he or she were an original Investor hereunder.

(h)

Legends.  It is understood that the certificates evidencing the Securities may bear the following legends in addition to any other legends called for by Texas law, this Agreement, the Warrants or any other agreements relating to the Securities to which Lender becomes a party:

(i)

“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS.  THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE BORROWER THAT SUCH REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF THE SECURITIES ACT OF 1933.”

(ii)

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN TRANSFER RESTRICTIONS AND OTHER AGREEMENTS CONTAINED IN AN AGREEMENT WITH THE BORROWER.  A COPY OF THE AGREEMENT AND ALL APPLICABLE AMENDMENTS THERETO WILL BE FURNISHED BY THE BORROWER TO THE RECORD HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON WRITTEN REQUEST TO THE BORROWER AT ITS PRINCIPAL PLACE OF BUSINESS OR REGISTERED OFFICE.”

(i)

The Lender acknowledges that the Bridge, the Bridge Financing, the Note and related documents (the “Bridge Offering”) have been prepared by an attorney who has been retained to do so by the Borrower and that all information contained within the Bridge Offering and all related documents is based upon information supplied to said attorney by the Borrower and that the attorney has not independently investigated or audited his client, the Borrower.  The Bridge Offering is made pursuant to Section 33 N, of the Texas Securities Act.  Under said Act, the Borrower is considered as a Small Business Issuer.  The Lender further acknowledges, in executing this Bridge Loan Agreement and any related documents, that said attorney’s services and limitations on any liability, as governed by Section 33 N of the Texas Securities Act, in the absence of intentional wrongdoing in providing the services, are limited to an amount equal to three times the fee paid by the Borrower or other seller to the attorney for the services related to the offer of securities.

3.

Representations and Warranties of the Borrower.  In connection with the transactions provided for herein, the Borrower hereby represents and warrants to the Lenders that:

(a)

Organization, Good Standing, and Qualification. The Borrower is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to carry on its business as now conducted and as proposed to be conducted.  The Borrower is duly qualified to transact business and is in good standing in each jurisdiction in which the failure so to qualify would have a material adverse effect on its business or properties.

(b)

Authorization.  All corporate action on the part of the Borrower, and its officers, directors, and stockholders necessary for the authorization, execution, and delivery of this Agreement and the Securities and the performance of all obligations of the Borrower hereunder and thereunder, including, but not limited to, the authorization and reservation for issuance of the Securities, has been taken.

(c)

Valid Issuance.  The Warrants, when issued, and delivered in accordance with the terms of this Agreement for the consideration expressed therein, will be duly and validly issued, and nonassessable and, based in part upon the representation of the Lenders in Section 2 of this Agreement, will be issued in compliance with all applicable federal and state securities laws.

(d)

Enforceability.  This Agreement, the Security Agreement, and the Warrants constitute valid and legally binding obligations of the Borrower, enforceable in accordance with their respective terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies.

(e)

Noncontravention.  The execution, delivery and performance by the Borrower of this Agreement, the Security Agreement, and the Warrants will not cause a default under, or otherwise breach, its Certificate of Incorporation or Bylaws, each as amended, or any other insurance, document or agreement to which the Borrower is a party or by which it is bound, or any law, rule or regulation applicable to the Borrower or its assets which such default or breach would have a material adverse effect on the Borrower.

4.

Successors and Assigns; Governing Law.  Each Lender understands that this Agreement shall be binding upon the executors, administrators, heirs, legal representatives, legatees, successors and assigns of such Lender and shall inure to the benefit of the Borrower, its successors and assigns.  This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.

5.

Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally or by commercial delivery service, or mailed by registered or certified mail (return receipt requested) or sent via facsimile (with confirmation of receipt) to the parties at the address for such party set forth below:

If to Lender:

Address specified for each Lender on Schedule I hereto

If to Borrower:

Smarte Solutions, Inc.

Address:  

Attn: Bala Vishwanath

Fax:

With a copy to:

[Worsham, Lancaster, Helling & Rose, LLP]

Address:  5001 Plaza On The Lake

Austin, TX 78746

Attn:

Chris J. HellingFax:

(512) 874-7138

6.

No Waiver.  The failure of the Borrower in any instance to exercise any rights provided hereby shall not constitute a waiver of any other rights that may subsequently arise under the provisions of this Agreement or any other agreement between the Borrower and the Lenders.  No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature.

7.

Expenses; Finders’ Fees.  Each Lender and the Borrower will bear its respective expenses incurred in connection with the sale of the Securities and the other transactions and agreements in connection therewith.  Except for any commissions or fees which may be paid by Borrower to Gray Capital Partners, LLC, each party represents that it neither is nor will be obligated for any finder’s fee or commission in connection with these transactions and agrees to indemnify and to hold harmless the other party from any liability for any commission or compensation in the nature of a finder’s fee (and the costs and expenses of defending against such liability or asserted liability) for which such party or any of its officers, partners, employees or representatives is or becomes responsible.

8.

Counterparts.  This Agreement may be executed in counterparts, all of which shall be considered one and the same instrument.

9.

Usury; Qualified Commercial Loan.

(a)

Usury.  All agreements between the Borrower and each Lender hereunder are expressly limited so that in no event shall the amount paid, or agreed to be paid, to any Lender for the use, forbearance or detention of the money to be loaned hereunder exceed the maximum amount permissible under applicable law.  If from any circumstances fulfillment of any provision of this Agreement, the Security Agreement, the Warrants, or of any other document evidencing, securing or pertaining thereto, at the time performance of such provision shall be due, shall involve transcending the limit of validity prescribed by law, then ipso facto, the obligation to be fulfilled shall be reduced to the limit of such validity, and if from any such circumstances a Lender shall ever receive anything of value as interest or deemed interest by applicable law pursuant to this Agreement, or any other document evidencing, securing, or pertaining to the indebtedness incurred hereby or pursuant to a Note, an amount that would exceed the highest lawful rate, such amount that would be excessive interest shall be applied to the reduction of the principal amount owing hereunder or under the applicable Note, and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal of the applicable Note, such excess shall be refunded to the Borrower.  In determining whether or not the interest paid or payable with respect to any indebtedness of the Borrower exceeds the highest lawful rate, the Borrower and the Lender shall, to the maximum extent permitted by applicable law, (i) characterize any nonprincipal payment as an expense, fee or premium rather than as interest, (ii) amortize, prorate, allocate and spread the total amount of interest throughout the full term of such indebtedness so that the actual rate of interest on account of such indebtedness is uniform throughout the term thereof and/or (iii) allocate interest between portions of such indebtedness, to the end that no such portion shall bear interest at a rate greater than that permitted by law.  The terms and provisions of this Section 9 shall control and supersede every other conflicting provision of all agreements between the Borrower and the Lenders.

(b)

Qualified Commercial Loan.  The transaction referenced herein will be evidenced by a the Note and Warrants which may be issued from time to time after the date hereof.  The parties hereto agree and acknowledge that each issuance of Debt and Warrants shall be considered part of the same overall transaction.  The Borrower hereby certifies that it has been advised by the Lenders to seek the advice of an attorney and an accountant in connection with the transactions referenced herein.  Furthermore, the Borrower has had an opportunity to seek the advice of an attorney and an accountant of the Borrower’s choice in connection with the transactions referenced herein.

[Signature page follows]

IN WITNESS WHEREOF, the parties hereto execute this Bridge Loan Agreement as of the date first set forth above.

BORROWER:

SMARTE SOLUTIONS, INC.

By:  /s/ BALA VISHWANATH

Bala Vishwanath, CEO

LENDER:

[LENDER NAME]

By: 

Print Name:  

Title: _______________________________

SCHEDULE I  SCHEDULE OF LENDERS

	
  Name

	
  Date

	
  Amount

	
  Warrants

	
  Warrant Exp

	
  Warrant Value

	
  Scott McAllister

	
  6/28/04

	
  $75,000.00

	
  10500

	
  6/28/05

	
  $5,250.00

	
  Jerry D. Simmons

	
  6/28/04

	
  $50,000.00

	
  7000

	
  6/28/05

	
  $3,500.00

	
  Randy Weiss

	
  6/29/04

	
  $150,000.00

	
  21000

	
  6/29/05

	
  $10,500.00

	
  Shelly & Shane Phillips

	
  6/30/04

	
  $25,000.00

	
  3500

	
  6/30/05

	
  $1,750.00

	
  Alice & Don Frenk

	
  6/30/04

	
  $27,000.00

	
  3780

	
  6/30/05

	
  $1,890.00

	
  John B. Hall

	
  6/30/04

	
  $25,000.00

	
  3500

	
  6/30/05

	
  $1,750.00

	
  Michael J. Blackwell

	
  7/6/04

	
  $50,000.00

	
  7000

	
  7/6/05

	
  $3,500.00

	
  Gregory Brown

	
  7/7/04

	
  $30,000.00

	
  4200

	
  7/7/05

	
  $2,100.00

	
  Agincourt, LLC

	
  7/7/04

	
  $100,000.00

	
  14000

	
  7/7/05

	
  $7,000.00

	
  Renata I. Krajnik

	
  7/7/04

	
  $10,000.00

	
  1400

	
  7/7/05

	
  $700.00

	
  Tracy Sharp

	
  7/7/04

	
  $40,000.00

	
  5600

	
  7/7/05

	
  $2,800.00

	
  Charles M. Gray

	
  7/8/04

	
  $50,000.00

	
  7000

	
  7/8/05

	
  $3,500.00

	
  Peter John Bagnall

	
  7/8/04

	
  $25,000.00

	
  3500

	
  7/8/05

	
  $1,750.00

	
  Azar Computer

	
  7/9/04

	
  $25,000.00

	
  3500

	
  7/9/05

	
  $1,750.00

	
  Thomas G. Reagan

	
  7/9/04

	
  $50,000.00

	
  7000

	
  7/9/05

	
  $3,500.00

	
  Judith Eifert Beck

	
  7/9/04

	
  $25,000.00

	
  3500

	
  7/9/05

	
  $1,750.00

	
  Richard Gift

	
  7/9/04

	
  $25,000.00

	
  3500

	
  7/9/05

	
  $1,750.00

	
  Greg Sparks

	
  7/9/04

	
  $75,000.00

	
  10500

	
  7/9/05

	
  $5,250.00

	
  Paul Foreman

	
  7/14/04

	
  $100,000.00

	
  14000

	
  7/14/05

	
  $7,000.00

	
  Ron Bowling

	
  7/16/04

	
  $50,000.00

	
  7000

	
  7/16/05

	
  $3,500.00

	
  Sherry Ellenbogen

	
  7/19/04

	
  $50,000.00

	
  7000

	
  7/19/05

	
  $3,500.00

	
  Mary Ann Thompson Frenk F Trust

	
  7/21/04

	
  $500,000.00

	
  70000

	
  7/21/05

	
  $35,000.00

	
  Carl Kleimann

	
  7/22/04

	
  $10,000.00

	
  1400

	
  7/22/05

	
  $700.00

	
  Odyssey Marketing Group

	
  7/22/04

	
  $50,000.00

	
  7000

	
  7/22/05

	
  $3,500.00

	
  Dorchie Ferrell

	
  7/22/04

	
  $50,000.00

	
  7000

	
  7/22/05

	
  $3,500.00

	
  Wayne Parkman

	
  7/27/04

	
  $75,000.00

	
  10500

	
  7/27/05

	
  $5,250.00

	
  Sue Hardy

	
  7/27/04

	
  $25,000.00

	
  3500

	
  7/27/05

	
  $1,750.00

	
  Sequel Properties 

	
  7/28/04

	
  $100,000.00

	
  14000

	
  7/28/05

	
  $7,000.00

	
  Gregory Wolski

	
  7/29/04

	
  $10,000.00

	
  1400

	
  7/29/05

	
  $700.00

	
  Ali Gallagher

	
  8/3/04

	
  $100,000.00

	
  14000

	
  8/3/05

	
  $7,000.00

	
  Celia Martin

	
  8/3/04

	
  $20,000.00

	
  2800

	
  8/3/05

	
  $1,400.00

	
  Richard L. Hunter, Jr

	
  8/3/04

	
  $50,000.00

	
  7000

	
  8/3/05

	
  $3,500.00

	
  Michael & Kimberly Kline

	
  8/5/04

	
  $25,000.00

	
  3500

	
  8/5/05

	
  $1,750.00

	
  Michael Mcauliffe

	
  8/5/04

	
  $38,822.29

	
  5436

	
  8/5/05

	
  $2,718.00

	
  Chanan Seneewongs 

	
  8/6/04

	
  $25,000.00

	
  3500

	
  8/6/05

	
  $1,750.00

	
  Vicki Frenk

	
  8/9/04

	
  $10,000.00

	
  1400

	
  8/9/05

	
  $700.00

	
  William & Elizabeth Race

	
  8/11/04

	
  $25,000.00

	
  3500

	
  8/11/05

	
  $1,750.00

	
  Kevin McAuliffe

	
  8/13/04

	
  $24,684.80

	
  3456

	
  8/13/05

	
  $1,728.00

	
  Timothy Glass

	
  8/13/04

	
  $15,000.00

	
  2100

	
  8/13/05

	
  $1,050.00

	
  M. Marcus Malinak

	
  8/17/04

	
  $19,343.05

	
  2709

	
  8/17/05

	
  $1,354.50

	
  Eric Sutherland

	
  8/19/04

	
  $25,000.00

	
  3500

	
  8/19/05

	
  $1,750.00

	
  Michael Craddock

	
  8/20/04

	
  $50,000.00

	
  7000

	
  8/20/05

	
  $3,500.00

	
  Bob Allison

	
  8/23/04

	
  $100,000.00

	
  14000

	
  8/23/05

	
  $7,000.00

	
  Manuel Coats

	
  8/24/04

	
  $25,000.00

	
  3500

	
  8/24/05

	
  $1,750.00

	
  TOTAL

	
   

	
  $2,429,850.14

	
  340181

	 

	
  $170,090.50

	 	 	 	 	 	 

            

EXHIBIT A

FORM OF 

SECURITY AGREEMENT

EXHIBIT B

ACCREDITED INVESTOR STATUS CERTIFICATION

	(c)

Accredited Investor Status

Initial all appropriate spaces on the following pages indicating the basis upon which the Lender qualifies as an accredited investor under Regulation D.

	For Individual Investors Only

	

(Initial)

	The Lender hereby certifies that he/she is an accredited investor because he/she has an individual net worth, or with his/her spouse has a joint net worth, in excess of $1,000,000.  For purposes of this questionnaire, “net worth” means the excess of total assets at fair market value, including home, home furnishings and automobiles, over total liabilities.

	

(Initial)

	(i)

The Lender hereby certifies that he/she is an accredited investor because he/she has individual income (exclusive of any income attributable to his/her spouse) of more than $200,000 in each of the past two years, or joint income with his/her spouse in excess of $300,000 in each of those years, and such Subscriber reasonably expects to reach the same income level in the current year.

	For Corporations, Foundations, Endowments, Partnerships, Limited Liability Companies or Limited Liability Partnerships

	

(Initial)

	(ii)

The Lender hereby certifies that it is an accredited investor because it has total assets in excess of $5,000,000 and was not formed for the specific purpose of acquiring the securities offered.

	

(Initial)

	(iii)

The Lender hereby certifies that it is an accredited investor because all of its equity owners are accredited investors.  The Company, in its sole discretion, may request information regarding the basis on which such equity owners are accredited.

	For Not-for-Profit Entities (Including Endowments, Private Foundations and Charities)

	

(Initial)

	(iv)

The Lender hereby certifies that it is an accredited investor because it is an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, was not formed for the specific purpose of acquiring the securities offered, and has total assets in excess of $5,000,000.

	For Trusts

	

(Initial)

	(v)

The Lender hereby certifies that it is an accredited investor because it has total assets in excess of $5,000,000, was not formed for the specific purpose of acquiring the securities offered, and its purchase is directed by a sophisticated person.  As used in the foregoing sentence, a “sophisticated person” is one who has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the prospective investment.

	

(Initial)

	(vi)

The Lender hereby certifies that it is an accredited investor because it is (i) a bank as defined in Section 3(a)(2) of the Securities Act, or a savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act, (ii) acting in a fiduciary capacity and (iii) subscribing for the purchase of the securities being offered on behalf of a trust account or accounts.

	

(Initial)

	(vii)

The Lender hereby certifies that it is an accredited investor because it is a revocable trust which may be amended or revoked at any time by the grantors thereof, the tax benefits of investments made by the trust pass through to the grantors and all of the grantors are accredited investors.  The Company, in its sole discretion, may request information regarding the basis on which such equity owners are accredited.

	For Banks, Savings and Loans and Similar Institutions

	

(Initial)

	(viii)

The Lender hereby certifies that it is an accredited investor because it is a bank as defined in Section 3(a)(2) of the Securities Act acting in its individual capacity.

	

(Initial)

	(ix)

The Lender hereby certifies that it is an accredited investor because it is an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act.

	

(Initial)

	(x)

The Lender hereby certifies that it is an accredited investor because it is a Small Business Investment Partnership licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958.

	For Insurance Companies

	

(Initial)

	(xi)

The Lender hereby certifies that it is an accredited investor because it is an insurance company as defined in Section 2(13) of the Securities Act.

EXHIBIT C

FORM OF 

STOCK PURCHASE WARRANT

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