ASSET PURCHASE AGR

EXHIBIT 2.4

Asset Purchase Agreement

By And Among

Gabriel Technologies Corporation,

Trace Technologies, LLC

As Purchaser,

and

CSI Wireless LLC

As Seller

Dated As Of July 25, 2006

TABLE OF CONTENTS

Page

SCHEDULES

EXHIBITS

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ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT (this " Agreement "), dated as of July 25, 2006, among Trace Technologies, LLC, a Nevada LLC (" Purchaser "), Gabriel Technologies Corporation, a Delaware corporation (" Gabriel ") and CSI Wireless LLC, a Delaware LLC (" Seller "). Certain capitalized terms used in this Agreement are defined in Exhibit A .

W I T N E S S E T H :

WHEREAS, Seller desires to sell to Purchaser, and Purchaser desires to purchase from Seller, all of Seller’s assets and technology used or useful in connection with the design, production, manufacture, enhancement, and support of Seller’s telematics device known as "Onyx", a portable, wireless, assisted GPS tracking device based on ReFLEX wireless technology and SnapTrack assisted GPS technology (the " Device ").

NOW, THEREFORE, in consideration of the mutual benefits to be derived from this Agreement and of the representations, warranties, conditions, agreements and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows: 

ARTICLE I

PURCHASE AND SALE 

1.1   Purchase and Sale of Assets . Pursuant to the terms and subject to the conditions of this Agreement, at the Closing (as defined in Section 1.3 ) Seller shall sell, convey, transfer and assign to Purchaser, free and clear of all mortgages, liens, charges, claims, pledges or other encumbrances (" Liens "), and Purchaser shall purchase from Seller, the Purchased Assets (as defined in Section 1.2 ).

1.2   Purchased Assets . 

(a)   The term " Purchased Assets " means all of Seller’s right, title and interest in and to the Device and the assets, technology, rights, and privileges used, held, owned, or licensed by Seller in connection with the design, manufacture, enhancement and support of the Device, including, without limitation:

(i)   the Onyx Manufacturing Package;

(ii)   the Onyx Capital Assets;

(iii)   the LT-501 Inventory;

(iv)   the Autonomous Device;

(v)   the ASP System;

(vi)   all permits, licenses, franchises, approvals, consents, registrations, clearances, variances, exemptions, orders, certificates or authorization by or of any Governmental Authority held or used in connection with the Device (" Permits "), and all applications for Permits, together with any renewals, extensions, and modifications thereof and additions thereto;

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(vii)   all claims, counterclaims, credits, causes of action, rights of recovery, and rights of indemnification or setoff against third parties and other claims to the extent they arise out of or relate to the Device and all other intangible property rights which relate to Device and/or the design, manufacture, enhancement, sale, license, or support of the Device;

(viii)   all right, title, and interest of Seller in, to, and under all trademarks, trade names, service marks, (including without limitation the Trademark), labels, logos, technology, software, firmware, data, licenses, patents, patent applications, patent licenses, trademark applications, copyright applications, computer software licenses, copyright, moral rights, know-how, trade secrets, and product designs and documentation and any other intellectual property used in connection with the Device and any derivative of the foregoing, together with all registrations and applications relating to, and goodwill associated therewith or connected with the use thereof, the foregoing, and any right to recovery for any infringement thereof (including without limitation past infringement); and

(ix)   all Seller’s right, title and interest in, to, and under or pursuant to all warranties, representations and guarantees made by suppliers, manufacturers and contractors in connection with products sold or services provided to Seller for or in connection with the Device;

For the avoidance of doubt, the Parties agree that Purchaser is not assuming and has no responsibility for any liabilities, obligations, or indebtedness of Seller, regardless of whether such liabilities are related to the Purchased Assets, arise as a result of the transactions contemplated by this Agreement, or are otherwise related to the Seller’s business in any manner. 

1.3   Closing . Subject to the conditions of this Agreement, the consummation of the transactions contemplated by this Agreement (the " Closing ") shall take place at the offices of Burnet, Duckworth & Palmer LLP, 1400, 350 - 7 ^th Avenue S.W., Calgary, Alberta, at 10:00 a.m. local time on August 4, 2006, or such other time and place as Purchaser and Seller may agree to in writing (such date of the Closing hereinafter referred to as the " Closing Date ") and shall be deemed to be effective as of 12:01 am on the Closing Date.

1.4   Purchase Price . In consideration of the sale of the Purchased Assets and Seller’s other covenants and obligations hereunder, Purchaser shall pay a cash purchase price in an aggregate amount of $825,000 (the " Cash Purchase Price "), specifically:

(a)   $125,000 into escrow upon execution of this Agreement (the "Deposit");

(b)   $325,000 into escrow at Closing;

(c)   $125,000 by way of a promissory note (the promissory notes described in Sections 1.4 (c) and (d), collectively referred to as " Promissory Notes "), due and payable ninety (90) days after the Closing Date in the form attached hereto as Exhibit C-1; and

(d)   $250,000 by way of a promissory note, due and payable one hundred and eighty (180) days after the Closing Date in the form attached hereto as Exhibit C-2.

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1.5   Gabriel Shares . As additional consideration, Gabriel shall issue to Seller at Closing, that number of common shares of Gabriel resulting from dividing $145,000.00 by the closing price of Gabriel shares on the NASD OTCBB on the day prior to the Closing Date (with such common shares being issued under this Section 1.5 being referred to as the " Gabriel Shares " for purposes of this Agreement, including without limitation the attachments, exhibits, and schedules thereto), calculated as at the Closing Date, subject to registration within one hundred and eighty (180) days of the Closing Date.

1.6   All payments to be made under Section 1.4 shall be paid by wire transfer of same day funds to an account at a financial institution designated by the payee to the payor in writing.

1.7   Security for Purchase Price. As security for the payment of that portion of the Purchase Price represented by the Promissory Notes, Gabriel hereby agrees to pledge, in accordance with and under the terms of a Share Pledge Agreement in the form set out in Exhibit F attached hereto (the " Share Pledge Agreement "), that number of common shares of Gabriel resulting from dividing $375,000.00 by the closing price of Gabriel shares on the NASD OTCBB on the day prior to the Closing Date (the " Pledged Shares "). For the avoidance of doubt, if the Purchaser fails to perform its obligations under the Promissory Notes, the Seller shall only be entitled to retain that number of Pledged Shares representing any unpaid amounts owed to Seller under the Promissory Notes as of the date of any default thereunder and Seller agrees to immediately return to Gabriel any such Pledged Shares not representing such unpaid amounts.

1.8   Cancellation of Technology Development and Manufacturing Agreement . As further consideration for entering into this Agreement, the Seller and Purchaser agree to terminate and cancel the Technology Development and Manufacturing Agreement, dated February 4, 2004, between Locate Networks, Inc. and the Seller, which agreement was subsequently assigned to the Purchaser pursuant to an assignment agreement dated August 11, 2004 between the Purchaser and Locate Networks, Inc., and to effect such termination, the Seller and Purchaser shall execute and deliver at Closing a Termination Agreement in the form set out in Exhibit G (the " Termination Agreement ").

1.9   Purchase Order . Purchaser shall order 1,500 units of the Device at Closing at $209/unit using the Seller's standard purchase order form (the " Purchase Order ") as such standard form is modified below. For purposes of this Agreement, the units of the Device ordered under the Purchase Order are defined herein as the " Units ". Such Purchase Order shall be in accordance with the delivery, payment, and warranty terms and conditions as more particularly set out in Exhibit H attached hereto. The parties agree that in lieu of Seller providing typical warranties or representations regarding the Units sold to the Purchaser pursuant to the Purchase Order, Seller shall provide to Purchaser additional Units equal to 5% of the total number of Units purchased by the Purchaser pursuant to the Purchaser Order, for a total number of Units to be delivered under the transactions contemplated by the Purchase Order to be 1,575. The Purchase Order shall be secured by a Letter of Credit for 2/3 of the Purchase Order's amount (" Letter of Credit "), which may be drawn down upon by Seller upon the condition that the Units are received by Purchaser's designated carrier at the Delivery Point (as defined below).

The Purchase Order and Letter of Credit shall be delivered by Purchaser to Seller at Closing. The remaining 1/3 of the amount owed by Purchaser under the Purchase Order shall be payable by Purchaser within thirty (30) days of the date of delivery by Seller to the Delivery Point (as defined below). All right, title and interest in and to the Units manufactured pursuant to the Purchase Order shall transfer to the Purchaser when all such Units have been transported from the Seller's manufacturing facility in Juarez, Mexico and shipped FCA the Purchaser's carrier's destination location in El Paso, Texas (the " Delivery Point "). Delivery shall occur and risk of loss shall pass to Purchaser upon receipt by Purchaser's designated carrier of the Units at the Delivery Point. Carriage and insurance from the Delivery Point shall be at Purchaser's sole risk and expense and any claim for loss or damage in transit shall be against the carrier only.

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1.10   Manufacturing Knowledge Transfer . Purchaser shall have the right to appoint an employee to participate in the manufacturing of the Units by the Seller pursuant to the Purchase Order described in Section 1.9 in order to learn the manufacturing process of the Units and, as applicable, the Devices. After delivery of the Units pursuant to the Purchase Order, Purchaser may engage Seller for further manufacturing support with respect to the Seller's current contract manufacturer as at the date of this Agreement, at the rate of $150/person/hour plus materials and expenses for a period ending December 31, 2006. Purchaser shall be responsible for all of its out-of-pocket expenses in connection with this Section, including without limitation, all travel and living expenses. In addition, Seller shall introduce Purchaser to Seller's contract manufacturer representative, in order for Purchaser to enter into negotiations with the contract manufacturer regarding continued support and manufacturing of the Devices with Purchaser. While Seller agrees to use its reasonable commercial efforts to facilitate a continuing relationship between such contract manufacturer and Purchaser, Purchaser acknowledges and agrees that Seller does not guarantee that the contract manufacturer will contract with Purchaser to manufacture further Devices for Purchaser.

1.11   Knowledge Training . Seller shall train the Purchaser regarding the Purchased Assets for a total of six (6) days at any time, whether consecutive or otherwise, during the three month period commencing on the date of this Agreement (the " Three Month Period "), not to exceed past December 31, 2006, at the Seller's offices located in Calgary, Alberta, Canada. Purchaser may request further training beyond the initial six (6) days, provided that such additional training shall be charged to the Purchaser at a rate of $150/person/hour plus materials and expenses; and provided that such additional training shall only be offered for a period ending December 31, 2006. Each party shall be responsible for all of its respective out-of-pocket expenses in connection with any training pursuant to this Section 1.11, including without limitation, all travel and living expenses.

1.12   PDI Protocol . In connection with the purchase and sale of the Purchased Assets, the Seller hereby grants to the Purchaser a royalty-free, non-exclusive, worldwide, perpetual right and license to use, modify, copy and enhance the Seller's proprietary PDI Protocol (as defined in Exhibit A) solely in connection with the design, manufacture, sale, enhancement, and support of the Device, the incorporation of the PDI Protocol into Devices, and the development, manufacture, sale, enhancement, and modification of other products created by the Purchaser that incorporate or use the PDI Protocol. All such modifications and enhancements to the PDI Protocol created by Purchaser shall be owned by the Purchaser. Purchaser shall not sell, assign, sublicense, rent, lease, grant a security interest in, or otherwise transfer any right in the PDI Protocol or distribute or network any portion of the PDI Protocol other than in connection with its sale, assignment, sublicense, rent, lease, use as security, or otherwise in connection with its incorporation into and or use in connection with a Device. Notwithstanding the foregoing, Purchaser may assign its right and license in and to the PDI Protocol pursuant to Section 7.12 herein.

1.13   Purchase Price Allocation . The Purchase Price shall be allocated among the Purchased Assets in a manner to be determined by Purchaser and the Seller, each acting reasonably, on or before Closing, which allocation shall be consistent with Section 1060 of the Internal Revenue Code (the " Purchase Price Allocation "). Each of the parties hereto agrees to be bound by the Purchase Price Allocation and will not take a position on any Tax Return before any Governmental Authority charged with the collection of any Tax or in any judicial proceeding that is in any way inconsistent with the Purchase Price Allocation and will cooperate with each other in timely filing Forms 8594 with the IRS consistent with such allocation. In the event that the Purchase Price Allocation is disputed by any Governmental Authority, the party receiving notice of the dispute shall promptly notify the other party hereto in writing of such notice and resolution of the dispute.

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1.14   Procedures for Certain Purchased Assets Not Freely Transferable .

(a)   If any property or right (other than the Permits as set forth below) included in the Purchased Assets is not assignable or transferable to Purchaser either by virtue of the provisions thereof or under any Law applicable to Seller or Seller’s properties or assets without the consent of one or more third persons (each, a " Non-Assignable Right "), Seller shall use its reasonable commercial efforts, at Seller’s sole cost and expense, to obtain such consents after the execution of this Agreement until such consent is obtained. If any such consent in respect of a Non-Assignable Right cannot be obtained prior to the Closing Date and the Closing nevertheless occurs, (i) this Agreement and the related instruments of transfer shall not constitute an assignment or transfer thereof, but (A) Seller shall use its reasonable commercial efforts to obtain such consent as soon as possible after the Closing Date, (B) Purchaser shall cooperate, to the extent commercially reasonable, with Seller in Seller’s efforts to obtain such consents; and (C) Seller shall use its reasonable commercial efforts to obtain for Purchaser substantially all of the practical benefit and burden of such property or rights, including by (1) entering into appropriate and reasonable alternative arrangements on terms mutually agreeable to Purchaser and Seller and (2) subject to the consent and control of Purchaser, enforcement, at the cost and for the account of Seller, of any and all rights of Seller against the other party thereto arising out of the breach or cancellation thereof by such other party or otherwise.

(b)   If any of the Permits included in the Purchased Assets is not assignable or transferable, this Agreement and the related instruments of transfer shall not constitute an assignment or transfer thereof, and Seller shall cooperate with Purchaser in its efforts to obtain a replacement Permit issued in Purchaser’s name. If any replacement Permit cannot be obtained prior to the Closing Date and the Closing occurs, Seller agrees to allow Purchaser to operate under its Permits if permitted by applicable Laws or applicable Governmental Authorities for a period of up to 90 days after the Closing (or such longer period as may be reasonably necessary for Purchaser and permitted by applicable laws and Governmental Authorities, using its commercially reasonable efforts, to obtain the replacement Permits).

1.15   Deposit

The Deposit shall be held in escrow by the Seller's solicitor upon terms and conditions as agreed to by the parties and the Seller's solicitor, including without limitation, the following terms:

(a) If the transactions contemplated in this Agreement are closed at Closing, the Deposit shall be applied to the Cash Purchase Price;

(b) If the transactions contemplated in this Agreement are not consummated due to the fault of the Purchaser, Seller shall be entitled to keep the Deposit;

(c) If the transactions contemplated in this Agreement are not consummated due to the fault of the Seller, the Deposit shall be returned to the Purchaser forthwith;

(d) If the transactions contemplated in this Agreement are not consummated due to no fault of the Purchaser and Seller, the Deposit shall be returned to Purchaser; and

(e) If a dispute arises in connection with the Deposit, the parties shall resolve the dispute by arbitration pursuant to Section 7.14 and the Seller's solicitors shall retain the deposit, which shall be placed on deposit at a reputable financial institution with interest, until a final resolution of the matter is reached by the Arbitration Panel pursuant to Section 7.14.

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1.16   ASP System License

Purchaser shall grant to Seller a non-exclusive, royalty-free license to use the ASP System and receive updates and upgrades from Purchaser solely for the purposes of assisting, and only to the extent necessary for the providing of such assistance, the Purchaser in the manufacture and use of the Purchased Assets pursuant to Sections 1.10 and 1.11. The license described in this Section shall terminate upon the earlier of: (1) Seller's fulfillment of Seller's obligations under Sections 1.10 and 1.11 or (ii) December 31, 2006.

ARTICLE II

REPRESENTATIONS AND WARRANTIES OF SELLER

2.1   Seller makes the following representations and warranties set forth in this Article II to Purchaser, as of the date hereof, and again at and as of the Closing Date:

(a)   Warranty of Ownership . Except as set forth on Schedule 2.1(a) (the "Permitted Liens") , Seller is the sole owner of and has good and marketable title and interest to all of the Purchased Assets, free and clear of all Liens, and the Purchased Assets are not subject to any restrictions or limitations on use or otherwise. The Seller has not taken any actions to assign, transfer or encumber the Purchased Assets in any manner. The Seller is not legally bound by any agreements or obligations relating to the Purchased Assets or under which the occurrence of the Closing could (i) obligate the Seller or the Purchaser to license or otherwise grant rights to any other person in the Purchased Assets (whether owned or used by the Seller or Purchaser), (ii) result in a claim against or Lien on the Purchased Assets, or (iii) otherwise increase any burdens or decrease any rights relating to the Purchased Assets. No other person has any interest in, or right or claim to, the Purchased Assets or any part thereof.

(b)   Conflicts; Consents . Except as set forth on Schedule 2.1(b) , none of the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor compliance by Seller with any of the provisions hereof (as well as all other instruments, agreements, certificates or other documents contemplated hereby) does or will (i) conflict with or result in a breach of, or require any consent or approval under, the charter or by-laws of Seller, (ii) violate any Law, or (iii) result in the creation or imposition of any claim, lien or encumbrance on the Purchased Assets. Except as set forth on Schedule 2.1(b) , no consent or approval by, or any notification of or filing with, any Governmental Authority or any other person or entity is required in connection with the execution, delivery and performance by Seller of this Agreement or the consummation of the transactions contemplated hereby.

(c)   Intellectual Property. 

(i)   Schedule 2.1(c) and Exhibit E set forth a true, accurate, and complete list of all of the following used in or for or otherwise necessary with respect to the design, development, manufacture, sale, license, enhancement, and support of the Device: computer software (other than general commercial software), firmware, data, patents, patent applications, patent licenses, trademarks, trademark applications, service marks, trade names, copyrights, copyright applications, trade secrets, know how, technology, computer software licenses, and other intellectual property and proprietary rights, and documentation thereof. Schedule 2.1(c) sets forth the registration numbers for any of the foregoing intellectual property rights that have been registered by Seller. Except as set forth on Schedule 2.1(c) , Seller (A) owns, or possesses legally enforceable rights under valid agreements, to use in the manner that they currently use, each of the foregoing items of intellectual property and all inventions, processes, designs, formulae, trade secrets and know-how necessary for the design, manufacture, enhancement and support of the Device, without the payment of any royalty or similar payment, and (B) has not granted to any third party any rights to use any of the foregoing intellectual property rights of Seller;

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(ii)   To Seller’s Knowledge and except as set forth in Schedule 2.1(c), neither the conduct of Seller’s business nor the Seller’s creation, use, license or other transfer of the Purchased Assets infringe upon or misappropriate the intellectual property rights of any person or entity nor has Seller received any notice or claim that any other person or entity claims a right or interest in the Purchased Assets. The Seller has not received notice of any pending or threatened legal proceeding or any allegation or claim in which any person alleges: (A) that the Seller, the Seller’s business or the Purchased Assets has violated any person’s intellectual property rights, or (B) a challenge to the legality, validity or enforceability of any of the intellectual property included within the Purchased Assets;

(iii)   Except as disclosed on Schedule 2.1(c) , to Seller's Knowledge, Seller owns all of its formulas, processes, designs and other confidential information used in connection with the Device that confers a commercial advantage to Seller as a result of its confidential status (" Trade Secrets "). All Trade Secrets were developed internally by Seller through bona fide business practices or were acquired by purchase from others. To Seller’s Knowledge, no intentional or inadvertent disclosure of any Trade Secret has occurred, whether through negligence, corporate espionage, or otherwise, and to Seller’s Knowledge, the Trade Secrets have not been independently discovered by any competitor;

(iv)   Except as set forth on Schedule 2.1(c) , Seller has taken commercially reasonable steps to (A) maintain the confidentiality of all Trade Secrets and other proprietary inventions, technical data, customer and supplier lists and information pertaining to the Devices and (B) backup and maintain in secure places copies of all databases, computer programs, and other electronically stored information material to Seller’s manufacture of the Device; 

(d)   Investment Representations

(i)   Seller understands that the Gabriel Shares and the Pledged Shares, if applicable, are being offered and sold pursuant to a private placement exemption from registration contained in the Securities Act based in part upon Seller’s representations contained in this Section 2.1(d);

(ii)   Seller is an accredited investor within the meaning of Regulation D under the Securities Act and is acquiring the Gabriel Shares and the Pledged Shares, if applicable, for its own account for investment only, and not with a view towards their distribution. Seller, by reason of its management’s, business or financial experience, has the capacity to protect its own interests in connection with the transactions contemplated by this Agreement;

(iii)   Seller understands that it must bear the economic risk of the Gabriel Shares and the Pledged Shares, if applicable, indefinitely unless its Gabriel Shares and the Pledged Shares, if applicable, are registered pursuant to the Securities Act, or an exemption from registration is available. Seller understands that there is no assurance that any exemption from registration under the Securities Act will be available and that, even if available, such exemption may not allow Seller to transfer all or any portion of the Gabriel Shares and the Pledged Shares, if applicable, under the circumstances, in the amounts or at the times Seller might propose;

(iv)   Seller has been advised or is aware of the provisions of Rule 144, which permits limited resale to the public in the United States of shares purchased in a private placement subject to the satisfaction of certain conditions, including, among other things: the availability of certain current public information about Purchaser, the resale occurring following the required holding period under Rule 144 and the number of shares being sold during any three-month period not exceeding specified limitations;

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(e)   Brokers . No agent, broker, investment banker or any other Person acting on Seller’s behalf or under Seller’s authority is or will be entitled to any broker’s or finder’s fee or any other commission or similar fee directly or indirectly from any of the parties hereto in connection with any of the transactions contemplated hereby;

(f)   Judgments . There are no judgments, liens, actions or proceedings pending, or to the knowledge of Seller threatened, against the Seller or the Purchased Assets anywhere, which would adversely affect the Purchased Assets, or the transactions contemplated hereunder. There is no legal proceeding, order, agreement or other arrangement that prohibits or restricts the Seller from any use of the Purchased Assets;

(g)   No Pending Disputes. There are no pending disputes between the Seller and any other person relating to the Purchased Assets;

(h)   No Violation of the Seller’s Rights . To the knowledge of the Seller, no person has used, infringed or misappropriated any of the Purchased Assets. Immediately after the Closing, the Purchaser will have sole rights to bring actions for infringement or misappropriation of the Purchased Assets. The Seller has not commenced or threatened any legal proceeding, or asserted any allegation or claim, against any person for infringement or misappropriation of the Purchased Assets or breach of any agreement involving the Purchased Assets;

(i)   Transfer . At the Closing, the Seller will transfer and assign good and marketable title and interest in and to the Purchased Assets to the Purchaser free and clear of any claims, Liens or liabilities of every nature. Immediately after the Closing, the Buyer will be the sole owner of, and will have valid title to, the Purchased Assets, and will have the full right to use, license and transfer the Purchased Assets in the same manner and on the same terms that the Seller had immediately prior to the Closing;

(j)   Unauthorized Actions . Seller will not take any action prior to or after the execution of this Agreement which would in any manner interfere with the carrying out of the transactions contemplated by this Agreement; and

(k)   Organization, Authority and Binding Agreement . Seller is a corporation duly organized, validly existing and in good standing under the laws of Delaware. Seller is qualified to do business as a foreign corporation in each other jurisdiction in which the nature of its business or ownership of its assets requires. Seller has full corporate power to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement has been duly authorized by Seller’s board of directors and authorization by Seller’s stockholders is not required. This Agreement has been duly executed and delivered by Seller and is the valid and binding obligation of Seller, enforceable against it in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF PURCHASER AND GABRIEL

3.1   Purchaser Representations and Warranties

Purchaser makes the following representations and warranties set forth in this Article III to Seller, as of the date hereof, and again at and as of the Closing Date:

(a)   Organization, Standing and Power . Purchaser is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Nevada. Purchaser has full power and authority to own, lease and operate its properties and to carry on its business as now being conducted.

(b)   Authority; Binding Agreement . Purchaser has full corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement has been duly authorized, executed and delivered by Purchaser and is its valid and binding obligation, enforceable against it in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws of general applicability relating to or affecting creditors’ rights and to general equitable principles.

(c)   Conflicts; Consents . Neither the execution and delivery of this Agreement, the consummation of the transactions contemplated hereby, nor compliance by Purchaser with any of the provisions hereof (as well as all other instruments, agreements, certificates or other documents contemplated hereby) will (i) conflict with or result in a breach of Purchaser’s charter, by-laws or other constitutive documents, (ii) conflict with or result in a default (or give rise to any right of termination, cancellation, acceleration or modification) under any of the provisions of any note, bond, lease, mortgage, indenture, license, franchise, Permit, agreement or other instrument or obligation to which Purchaser is a party, or by which Purchaser or its properties or assets, may be bound or affected, except for such conflict, breach or default as to which requisite waivers or consents shall be obtained before the Closing, or (iii) violate any Law applicable to Purchaser or its properties or assets. No consent or approval by, or any notification of or filing with, any governmental authority or body is required in connection with the execution, delivery and performance by Purchaser of this Agreement or the consummation of the transactions contemplated hereby.

(d)   Brokers . No agent, broker, investment banker or other Person acting on Purchaser’s behalf or under Purchasers’ authority is or will be entitled to any broker’s or finder’s fee or any other commission or similar fee directly or indirectly from any of the parties hereto in connection with any of the transactions contemplated hereby.

3.2   Gabriel Representations and Warranties

(a)   Organization, Standing and Power . Gabriel is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Gabriel has full corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted.

(b)   Authority; Binding Agreement . Gabriel has full corporate power and authority to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement has been duly authorized, executed and delivered by Gabriel and is its valid and binding obligation, enforceable against it in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws of general applicability relating to or affecting creditors’ rights and to general equitable principles.

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(c)   SEC Reports . Gabriel has on a timely basis filed all forms, reports and documents required to be filed by it with the United States Securities and Exchange Commission (the " SEC ") since March 31, 2006 (the " SEC Reports "). All SEC Reports (x) were prepared in accordance with the requirements of the Securities Act and the Exchange Act, as the case may be, and the rules and regulations thereunder and (y) did not at the time they were filed with the SEC contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. Gabriel is in compliance with the applicable listing rules of NASDAQ and the OTCBB and, since March 31, 2006, has not received any notice from NASDAQ or the OTCBB asserting any non-compliance with such rules.

(d)   Gabriel Shares . Upon delivery of the Gabriel Shares and the Cash Purchase Price by Purchaser in the manner contemplated in Section 1.4 and Section 1.5 , and the delivery of the Purchased Assets by Seller to Purchaser, Seller shall acquire the beneficial and legal title to the Gabriel Shares, free and clear of all Liens, except for restrictions on transfer under United States federal and state securities laws. All Gabriel Shares will be validly issued, fully paid and nonassessable and shall have the benefit of the Registration Rights Agreement (as defined in Section 4.12) to be entered into at the Closing.

ARTICLE IV

ADDITIONAL AGREEMENTS

4.1   Expenses . Each party hereto shall bear its own costs and expenses incurred in connection with the transactions contemplated by this Agreement.

4.2   Conduct of Business . From the date hereof until the earlier of the termination of this Agreement or the Closing Date, except as otherwise expressly permitted by this Agreement or except with the other party's prior written consent, Purchaser and Seller shall operate its respective business in the ordinary course of business.

4.3   Further Assurances . Each of the parties hereto agrees to use all commercially reasonable efforts to take, or cause to be taken, all action, and to do, or cause to be done, all things necessary, proper or advisable under applicable law, to consummate and make effective the transactions contemplated by this Agreement as expeditiously as practicable and to ensure that the conditions to the other party’s obligations to close as set forth in Article V hereof are satisfied, insofar as such matters are within the control of either of them. In case at any time after the Closing Date any further action is necessary or desirable to carry out the purposes of this Agreement, each of the parties to this Agreement shall take or cause to be taken all such necessary action, including the execution and delivery of such further instruments and documents, as may be reasonably requested by either party for such purposes or otherwise to complete or perfect the transactions contemplated hereby. 

4.4   Public Announcement . Until the Closing, neither Purchaser nor Seller shall issue or cause the dissemination of any press release or other public announcements or statements with respect to this Agreement or the transactions contemplated hereby without the consent of the other party, which consent will not be unreasonably withheld or delayed, except as may be required by law or by any listing agreement with a national securities exchange or trading market (and in such case shall use all reasonable efforts to consult the other party prior to such release or statement), or except as otherwise set out in Section 4.11.

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4.5   Tax Matters .

(a)   Transfer Taxes . All recordation, transfer, documentary, excise, sales, value added, use, stamp, conveyance or other similar Taxes, duties or governmental charges, and all recording or filing fees or similar costs, imposed or levied by reason of, in connection with or attributable to the transfer of the Purchased Assets by the Seller to the Purchaser pursuant to this Agreement or the transactions contemplated hereby (collectively, " Transfer Taxes ") shall be borne by Purchaser . For the avoidance of doubt, each party shall be responsible for and shall pay its own income taxes in connection with the sale of the Purchased Assets pursuant to this Agreement.

(b)   Cooperation and Exchange of Information . Each of Seller and Purchaser shall in connection with the Purchased Assets (i) provide the other with such assistance as may reasonably be requested by the other party in connection with the preparation of any Tax Return, audit or other examination by any taxing authority or judicial or administrative proceeding relating to liability for Taxes, (ii) retain and provide the other with any records or other information that may be relevant to such Tax Return, audit or examination, proceeding or determination, and (iii) provide the other with any final determination of any such audit or examination, proceeding or determination that affects any amount required to be shown on any Tax Return of the other for any period.

4.6   Consents of Others . Prior to the Closing, each party shall use commercially reasonable efforts to obtain all authorizations, consents and permits required for such party to permit the consummation of the transactions contemplated hereby, including without limitation the consents described on Schedule 2.1(b) . Each party shall, at the other's request, cooperate in such efforts; provided , however , that such cooperation shall not require either party to accept any material modification to the terms of any agreement. 

4.7   Notice of Developments . Seller shall give prompt written notice to Purchaser of any material development affecting the Purchased Assets, liabilities, business, financial condition, prospects, operations or results of operations of Seller in connection with the Purchased Assets. Purchaser shall give prompt written notice to Seller of any material development affecting Purchaser's business, and each party hereto will give prompt written notice to the others of any material development affecting the ability of any such parties to consummate the transactions contemplated hereby.

4.8   Insurance . Prior to Closing, Seller shall use its commercially reasonable efforts to cooperate and provide information requested by Purchaser in order to facilitate the replacement by Purchaser at Closing of Seller’s current insurance coverage.

4.9   Post-Closing Access and Confidentiality of Information . Seller acknowledges and agrees that from and after the Closing Date, Purchaser will be entitled to possession of copies of all documents, books, records, agreements, and financial data of any sort relating to the Purchased Assets (with all of such documents, books, records, agreements, financial data, and any other data or financial information constituting or relating to the Purchased Assets being defined herein as "Confidential Information"); provided , however, that Seller, upon reasonable notice to Purchaser, shall be entitled to reasonable access to and to make copies of such books and records, or to obtain temporary possession of any thereof as necessary for auditing, Tax or litigation purposes, at Seller's sole cost and expense. Following the Closing, Seller shall not disclose any Confidential Information to any other person or use any Confidential Information for any purpose, other than as required by Law after notice to Purchaser. For purposes of this Section 4.9 , information that has been publicly disclosed other than by a breach by Seller of this Agreement shall cease to be Confidential Information.

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4.10   Litigation Support . In the event and for so long as any party actively is contesting or defending against any charge, complaint, action, suit, proceeding, hearing, investigation, claim or demand in connection with (i) any transaction contemplated under this Agreement or (ii) any fact, situation, circumstance, status, condition, activity, practice, plan, occurrence, event, incident, action, failure to act or transaction on or before the Closing Date involving Seller, each of the other parties will cooperate with it and its counsel in the contest or defense, make available its personnel, and provide such testimony and access to its books and records as shall be reasonably necessary in connection with the contest or defense, all at the sole cost and expense of the contesting or defending party (unless the contesting or defending party is entitled to indemnification therefore under Article VI below).

4.11   No Disclosure . Each party shall keep and cause its affiliates to keep the terms and conditions of this Agreement, as well as information disclosed to such party under this Agreement, confidential, except to the extent required by law and pursuant to the public reporting obligations of the parties or to attorneys, accountants or other advisors or in connection with litigation relating to this Agreement.

4.12   Registration Rights Agreement . At the Closing, Seller shall enter into a Registration Rights Agreement with Gabriel in the form of Exhibit B (the " Registration Rights Agreement "), which will govern Gabriel's registration obligations with respect to the Gabriel Shares.

4.13   Seller Closing Documents . At Closing, Seller shall deliver or cause to be delivered to Purchaser:

(a)   a duly executed bill of sale, in the form attached hereto as Exhibit I;

(b)   assignments for any registrations and applications included in the intellectual property to be assigned pursuant to Section 1.2(a)(viii) , in such form or forms as shall be recordable in all jurisdictions in which such registrations have been made or such applications have been filed;

(c)   all such other deeds, endorsements or other instruments as shall be requested by Purchaser to vest in Purchaser good and marketable title to all of the Purchased Assets, free and clear of all Liens other than Permitted Liens;

(d)   a receipt, in a form satisfactory to Purchaser, acknowledging receipt of the portion of Cash Purchase Price payable at Closing in partial satisfaction of Purchaser’s obligations pursuant to Section 1.4 ;

(e)   evidence acceptable to Purchaser in its sole discretion, that all Liens identified on Schedule 2.1(a) have been prior to Closing, or at Closing will be, properly terminated, discharged or released;

(f)   a certificate of good standing (or equivalent document) in respect of Seller certified by an appropriate official in the Seller's jurisdiction of incorporation, dated as of a date not more than ten days prior to the Closing Date;

(g)   a certificate, dated as of the Closing Date, duly executed by an authorized officer of Seller certifying that:

(i)   the conditions set forth in Sections 5.1(a) and 5.1(b) have been fulfilled;

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(ii)   all documents to be executed by Seller and delivered at the Closing, including all documents listed in this Section 4.13, have been executed by a duly authorized officer of Seller; and

(iii)   (A) Seller’s articles of incorporation and bylaws, including all amendments thereto, attached to the certificate are true, correct and complete, (B) such organizational documents have been in full force and effect in the form attached since the date of the adoption of the resolutions referred to in clause (C) below and no amendment to such organizational documents has occurred since the date of the last amendment annexed thereto, if any, (C) the resolutions adopted by Seller’s board of directors authorizing the execution, delivery and performance of this Agreement, attached to the certificate, were duly adopted by unanimous written consent or at a duly convened meeting thereof, at which a quorum was present and acting throughout, remain in full force and effect, and have not been amended, rescinded or modified, except to the extent attached thereto, and (D) no authorization by any of Seller’s stockholders is required for Seller to authorize, execute, deliver or perform this Agreement.

(h)   such other documents, certificates or instruments as Purchaser may reasonably request, and all actions and proceedings hereunder and all documents and other papers required to be delivered by Seller hereunder or in connection with the consummation of the transactions contemplated hereby, and all other related matters, shall be reasonably acceptable to Purchaser as to their form and substance (except as otherwise provided herein);

(i)   the Termination Agreement, and the Registration Rights Agreement;

(j)   copies of all third party consents or waivers described in Section  2.1(b) and any Permits described in Section 1.2(vi); and

(k)   a letter from Seller to each of its tooling vendors, copied to the Purchaser, introducing the Purchaser to such vendors and confirming the transfer of ownership of the Purchased Assets to the Purchaser.

4.14   Purchaser/Gabriel Closing Documents . At Closing, Purchaser and Gabriel shall deliver or cause to be delivered to Seller:

(a)   copies of all third party consents or waivers contemplated by Section  3.1(c) including any consent required from the NASD OTCBB or the SEC;

(b)   a certificate for the Gabriel Shares;

(c)   a Certificate of good standing (or equivalent document) in respect of Purchaser and Gabriel certified by an appropriate official in each of Purchaser's and Gabriel's jurisdiction of incorporation, dated as of the date not more than ten days prior to the Closing Date;

(d)   a certificate, dated as of the Closing Date, duly executed by an authorized officer of Purchaser, certifying that;

(i)   the conditions set forth in Sections 5.2(a) and (c) have been fulfilled;

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(ii)   all documents to be executed by Purchaser and delivered at Closing, including all documents listed in this Section 4.14, have been duly executed by a duly authorized officer of Purchaser; and

(iii)   (A) Purchaser's and Gabriel's Articles of Incorporation and By-laws and such other constating documents, including all amendments thereto, attached to the Certificate are true, correct and complete; (B) Such organizational documents have been in full force and effect in the form attached since the date of the adoption of the resolutions referred to in Clause C below, and no amendment to such organizational documents has occurred since the date of the last amendment annexed thereto, if any; (C) the Resolutions adopted by each of the Purchaser's and Gabriel's respective Board of Directors authorizing the execution, delivery and performance of this Agreement attached to the Certificate, were duly adopted by unanimous written consent or at a duly convened meeting thereof, at which a quorum was present and acting throughout, remain in full force and effect, and have not been amended, rescinded or modified except to the extent attached thereto, and (D) no authorization by any of Seller's or Gabriel's stock holders or Purchaser's stockholders is required for Purchaser to authorize, execute, deliver or perform this Agreement.

(e)   executed copies of the Promissory Notes, Letter of Credit, Purchase Order, Termination Agreement, Share Pledge Agreement and Registration Rights Agreement;

(f)   the Pledged Shares, registered in the name of the Seller; and

(g)   such other documents, certificates or instruments as Seller may reasonably request, and all actions and proceedings hereunder and all documents and other papers required to be delivered by Purchaser hereunder or in connection with the consummation of the transactions contemplated hereby, and all other related matters, shall be reasonably acceptable to Seller as to their form and substance.

ARTICLE V

CLOSING CONDITIONS

5.1   Conditions to Obligations of Purchaser . Purchaser’s obligations to enter into the Closing are subject to the satisfaction, at or prior to the Closing, of the following conditions, unless waived by Purchaser:

(a)   Covenants, Representations and Warranties . Seller’s representations and warranties contained herein shall be true and correct as of the date hereof and again at and as of the Closing Date, except for any changes resulting from activities or transactions which may have taken place after the date hereof and which are permitted or contemplated by this Agreement and except to the extent that such representations and warranties are expressly made as of another specified date and, as to such representation, the same shall be true as of such specified date. Seller shall have performed and complied in all material respects with all covenants and agreements required to be performed or complied with by it on or prior to the Closing Date.

(b)   Governmental Approvals . All notices, reports, registrations and other filings with, and all consents, approvals and authorizations from, any governmental entity shall have been made or obtained, as the case may be, except for any such filings and approvals the failure of