ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT

            THIS ASSET PURCHASE AGREEMENT  (the “ Agreement ”) is made and entered into this 25th day of February, 2005 by and between Jayco Ventures, Inc., a Florida corporation (the “ Company ”) and M-Wave DBS, Inc., an Illinois corporation (the “ Purchaser ”).  The Purchaser and the Company hereinafter are sometimes referred to individually as a “ Party ” and collectively as the “ Parties .”  Jason Cohen (“ Cohen ”) and Joshua Blake (“ Blake ”) are parties to this Agreement solely with respect to Sections 3.3.4, 3.3.6, 6.2 and 8.2 below.

RECITALS:

WHEREAS, the Company is in the business of distributing Direct Broadcasting Satellite (DBS) industry products (the “ Business ”); and

WHEREAS, the Company desires to sell, transfer and assign to the Purchaser and the Purchaser desires to purchase from the Company substantially all of the assets of the Company, other than Excluded Assets (as defined in Section 1.2 ) for an amount in cash, all as herein provided and on the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Agreement, and for 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 of the Purchased Assets

1.1        Purchased Assets .  On the Closing Date (as defined in Section 3.2 ), upon the terms and subject to the conditions of this Agreement, the Company will sell, assign, transfer, grant, bargain, setover, release, deliver, vest and convey to Purchaser or cause to be sold, assigned, transferred, granted, bargained, setover, released, delivered and conveyed to Purchaser, and Purchaser will purchase from the Company all of the assets, properties and goodwill of every kind and description, wherever located, whether tangible or intangible, real, personal or mixed, directly or indirectly owned by the Company, or to which it is directly or indirectly entitled and, in any case, belonging to or used or intended to be used in the Business, free and clear of all liens, mortgages, pledges, security interests, claims, assessments, restrictions, encumbrances and charges of every kind (collectively, “ Liens ”), other than the assets described in Section 1.2 which shall be excluded from the sale (the assets to be purchased by Purchaser being referred to collectively as the “ Purchased Assets ” and the assets to be excluded being referred to collectively as the “ Excluded Assets ”).  The Purchased Assets shall include, without limitation, the following:

1.1.1        the going concern value of the Business;

1.1.2        the goodwill of the Company relating to the Business;

1.1.3        all other intangible rights and property of the Company as set forth on Schedule 4.9, including intangible rights and property of Cohen and/or Blake if such intangible rights and property was or is Used by the Company, including but not limited to, all of the Company’s, Cohen’s and Blake’s right, title and interest in, to and under (i) all patents, inventions (whether or not patented or able to be patented), works of authorship, mask works, data, technology, know-how, trade secrets, ideas and information, designs, formulas, algorithms, processes, methods, schematics and computer software (in source code and/or object code format); (ii) all trade names, trade and service marks, logos, domains, URLs, websites, addresses, and other designations (collectively, “ Marks ”); and (iii) patent rights, Mark rights, copyrights, mask work rights, sui generis  database rights, trade secret rights, moral rights, and all other intellectual and industrial property rights of any sort throughout the world and all applications, registration, issuance’s and the like with respect thereto (collectively, the “ Intellectual Property ”), that was or is used, exercised or exploited (collectively, “ Used ”);

1.1.4        all machinery, equipment, tools, furniture, office equipment, computer hardware, supplies, materials, vehicles and other items of tangible personal property (other than Inventories) of every kind currently owned or leased by the Company (wherever located and whether or not carried on the Company’s books), together with any express or implied warranty by the manufacturers or sellers or lessors of any item or component part thereof and all maintenance records and other documents relating thereto (collectively, the “ Tangible Personal Property ”);

1.1.5        all contracts, agreements, leases, licenses, purchase and sales orders, quotations and other executory rights of the Company and commitments of third parties relating to the Business, as expressly listed on Schedule 1.1.5 , (i) under which the Company  has, or may acquire, any rights or benefits; (ii) under which the Company has or may become subject to any obligation or liability; or (iii) by which the Company, or any of the Purchased Assets owned by the Company or used in the Business, is or may become bound; and (iv) all outstanding offers or solicitations made by or to the Company to enter into any of the foregoing (collectively, the “ Contracts ”);

1.1.6        all rights of the Company relating to deposits and prepaid expenses, claims for refunds and rights to offset in respect thereof associated with any Purchased Asset, excluding any such deposits and prepaid expenses for rent, telephone and other utilities not purchased by Purchaser;

1.1.7        (i) all trade accounts receivable and other rights to payment from customers of the Company and the full benefit of all security for such accounts or rights to payment, including all trade accounts receivable representing amounts receivable in respect of goods shipped or products sold or services rendered to customers of the Company; (ii) all other accounts or notes receivable of the Company and the full benefit of all security for such accounts or notes; and (iii) any claim, remedy or other right  related to any of the foregoing that exists immediately prior to the Closing Date (collectively, the “ Accounts Receivable ”);

1.1.8        all inventories of the Company, that are directly or indirectly maintained, held, or stored, by or for the Company for use in or by the Business immediately prior to the Closing Date, and any prepaid deposits for the same, including raw materials, work in process, finished goods, office supplies, maintenance supplies, packaging materials, spare parts and similar items (collectively, the “ Inventories ”);

1.1.9        all information related to the Business that is stored on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form, including but not limited to, client and customer lists, service and warranty records, supplier lists, shipping and receiving records, research and development information, production reports, equipment logs, operating guides and manuals, financial, tax and accounting records, marketing, advertising and other creative materials, management reports, computer files, computer software and programs and any rights thereto, correspondence and other similar documents and, to the extent allowed under applicable law, copies of all personnel records (collectively, the “ Records ”);

1.1.10    all insurance benefits, including rights and proceeds, arising from or relating to the Business, the Purchased Assets or the Assumed Liabilities prior to the Closing Date, unless expended in accordance with this Agreement;

1.1.11    all claims of the Company against third parties relating to the Purchased Assets or the Business, whether choate or inchoate, known or unknown, contingent or not contingent;

1.1.12    all permits, licenses, consents, registrations or authorizations issued, given or otherwise made available to the Company by or under the authority of any Governmental Authority, and all pending applications therefor, or renewals thereof, in each case to the extent transferable to Purchaser (collectively, the “ Permits ”); and

1.1.13    all rights of the Company immediately prior to the Closing Date in, to and under all other assets, rights and claims of every kind and nature used or intended to be used in the operation of, or residing with, the Business.

1.2        Excluded Assets .  Anything to the contrary in Section 1.1  notwithstanding, the Purchased Assets shall exclude the following assets of the Company (collectively, the “ Excluded Assets ”):

1.2.1     the Company’s rights under this Agreement and all documents and instruments executed in connection with this Agreement;

1.2.2     any life insurance policies, and the cash value thereof, of the Company;

1.2.3     the corporate charter, qualifications to conduct business as a foreign corporation, arrangements with registered agents relating to foreign qualifications, taxpayer and other identification numbers, seals, minute books, stock transfer books, blank stock certificates and other documents relating to the organization, maintenance and existence as a corporation of the Company;

1.2.4      all real property leases to which the Company is a party;

1.2.5      the Company’s Tax Returns (as defined in Section 4.4.2)  and rights to refunds of income taxes paid prior to the Closing Date;

1.2.6     all rights of the Company relating to lease deposits and claims for refunds and rights to offset in respect thereof; and  

1.2.7     any other asset specifically identified in Schedule 1.2 .

1.3        Assignment of Contracts .  The Purchaser shall cooperate with the Company in obtaining any third party consents that may be required to transfer the Purchased Assets to the Purchaser, including the provision of such information of the Purchaser as may be reasonably requested by such third parties in the context of their review of requests for consent.  Notwithstanding anything in this Agreement to the contrary, this Agreement shall not constitute an assignment of any Contract, if an attempted assignment thereof, without the consent of a third party thereto, would constitute a breach thereof or in any way adversely affect the rights of the Purchaser thereunder.  If such consent is not obtained, or if an attempted assignment thereof would be ineffective or would affect the rights of the Company thereunder so that the Purchaser would not in fact receive all such rights, the Company will cooperate with the Purchaser, at Purchaser’s expense, in any reasonable arrangement designed to provide for the Purchaser the benefits under such claims, contracts, licenses, franchises, leases, commitments, sales orders, sales contracts, supply contracts, service agreements, purchase orders, purchase commitments or receivables.

1.4        Assumed Liabilities . The Purchaser will only assume liabilities and obligations of the Company pursuant to executory contracts, and orders and commitments specifically included in the Purchased Assets listed on Schedule 1.1.5  (collectively, the “ Assumed Liabilities ”):

1.5        Excluded Liabilities . Except for the Assumed Liabilities, the Purchaser shall not assume by virtue of this Agreement or the transactions contemplated hereby, and shall have no liability for, any liabilities of the Company (including, without limitation, those related to the Business) of any kind, character or description whatsoever, including but not limited to the following liabilities (collectively, the “ Excluded Liabilities ”):

1.5.1      any liability or obligation that arises out of the transactions contemplated by this Agreement or results from any breach or default by the Company under this Agreement or any agreement, certificate or other document or instrument that may be executed or delivered in connection with this Agreement or the transactions contemplated hereby, or any liability or obligation where the existence, imposition, nature or extent of such liability or obligation gives rise to or constitutes a breach or default by the Company under this Agreement or any other agreement, certificate or other document or instrument that may be executed or delivered by the Company in connection with this Agreement or the transactions contemplated hereby;

1.5.2      any liability, accruals for, or obligation relating to income taxes, franchise, sales, use, payroll, unemployment and withholding taxes, including deferred income taxes reflected on the Last Balance Sheet (as defined in Section 4.3 ), including any interest or penalties related thereto, incurred and payable by the Company on or prior to the Closing Date;

1.5.3      any liability or obligation relating to indebtedness for borrowed money of the Company and all interest thereon and all fees, charges, penalties and other amounts incurred in connection therewith;

1.5.4      other than an Assumed Liability, any liability or obligation relating to any violation of any law, statute,  rule or regulation by the Company that arises out of or results from the Closing or any act, omission, occurrence or state of facts prior to the Closing;

1.5.5     any liability related to the defects in products sold by the Company or negligence or omissions in the manner in which products of the Company are sold or distributed, whether within the nature of product liability and whether such liability arises from sales or events prior to the Closing;

1.5.6      any liability related to the employment practices of the Company prior to Closing;

1.5.7      any liability or obligation of the Company to its sole shareholder or his affiliates; and

1.5.9      any obligation or liability under any real property lease to which the Company is a party.

1.6        No Expansion of Third Party Rights.   The (a) assumption by the Purchaser of the Assumed Liabilities, (b) transfer thereof by the Company and (c) limitations in the description of Excluded Liabilities in Section 1.5  shall in no way expand the rights or remedies of any third party against the Purchaser or the Company as compared to the rights and remedies such third party would have had against the Company had the Purchaser not assumed such liabilities.  Without limiting the generality of the preceding sentence, the assumption by the Purchaser of the Assumed Liabilities shall not create any third party beneficiary rights.

1.7        Insurance Proceeds.  If any of the Purchased Assets are destroyed or damaged or taken in condemnation on or prior to the Closing Date, the insurance proceeds or condemnation award with respect thereto shall be a Purchased Asset; provided that, in the event the destruction, damage or condemnation has a material adverse effect on the Business and such destroyed, damaged or condemned Purchased Assets are not capable of being promptly replaced by the Company prior to the Closing, the Purchaser may, by delivering written notice to the Company, terminate this Agreement and all Parties’ obligations and rights hereunder.  At the Closing, the Company shall pay or credit to the Purchaser any such insurance proceeds or condemnation awards received by it on or prior to the Closing and shall assign to or assert for the benefit of the Purchaser all of its rights against any insurance companies, governmental or regulatory authorities and others with respect to such damage, destruction or condemnation.  As and to the extent that there is available insurance under policies maintained by the Company and its affiliates, predecessors and successors in respect of any Assumed Liability, except for any such insurance proceeds with respect to which the insured is directly or indirectly self-insured or has agreed to indemnify the insurer, the Company shall cause such insurance to be applied toward the payment of such Assumed Liability.

ARTICLE II

Purchase Price

2.1        Purchase Price .  In consideration for the Purchased Assets, the Purchaser shall pay to the Company One Million Three Hundred and Sixty Thousand Dollars ($1,360,000.00) (the “ Purchase Price ”).  In addition, at the Closing the Purchaser shall assume the Assumed Liabilities.

2.2        Payment of Purchase Price.  

2.2.1      At the Closing, the Purchaser shall pay to the Company, by wire transfer of immediately available funds to an account or accounts designated by the Company, an amount equal to the Purchase Price minus  the Good Faith Deposit (as defined in Section 2.2.2  below) (the “ Closing Payment ”).

2.2.2     Pursuant to a letter agreement dated January 27, 2005 by and between the Parties (the “ Good Faith Deposit Agreement ”), the Purchaser deposited One Hundred Thirty-Six Thousand Dollars ($136,000) with Genovese, Joblove & Battista (the “Escrow Agent”) as a good faith deposit in connection with the transaction contemplated herein (the “Good Faith Deposit”).  At the Closing, the Escrow Agent shall disburse the Good Faith Deposit by wire transfer of immediately available funds to an account or accounts designated by the Company.  The Company shall provide Purchaser with the account information necessary to complete this transaction either prior to or at the Closing.

ARTICLE III

Pre-Closing; Closing Conditions; Pre-Closing Covenants; Execution

3.1        Pre-Closing.   From the date of this Agreement through the earlier of termination hereof or Closing, the Company shall use its commercially reasonable efforts to provide (or cause to be provided) the information, materials and access reasonably requested by the Purchaser.

3.2        Time and Place of the Closing .  The closing of the transactions contemplated by this Agreement (the “ Closing ”) shall take place at the offices of Adorno & Yoss, LLP, 350 E. Las Olas Boulevard, Suite 1700, Fort Lauderdale, Florida 33301, or by mail or facsimile transmission of the documents, certificates and instruments required to consummate the transactions contemplated hereby, on February 25, 2005 or such other date and place as the Parties shall mutually determine (the “ Closing Date ”).  The Company agrees that the Purchaser shall have the right to extend the Closing Dated by up to five (5) business days at its sole discretion.

3.3        Closing Transactions .  Subject to the conditions set forth in this Agreement, the Parties shall consummate the following transactions (the “ Closing Transactions ”) on the Closing Date:

3.3.1      the Company and the Purchaser shall enter into an Assignment and Assumption Agreement, and a Bill of Sale and General Assignment in a form customary in transactions similar to the transaction contemplated herein and satisfactory to the Parties;

3.3.2      the Purchaser, or its designee, shall deliver the Closing Payment to the Company by wire transfer of immediately available funds to an account or accounts designated by the Company;

3.3.3      the parties shall deliver joint written instructions to the Escrow Agent directing the Escrow Agent to disburse the Good Faith Deposit by wire transfer of immediately available funds to an account or accounts designated by the Company;

3.3.4     the Purchaser, Cohen and Blake shall execute (A) an employment agreement between the Purchaser and Jason Cohen in the form attached hereto as Exhibit A-1 , and (B) an employment agreement between the Purchaser and Joshua Blake in the form attached hereto as Exhibit A-2 ;

3.3.5     the Company shall deliver to the Purchaser, or leave at the Premises (as defined in Section 4.5 ) at which they are located, all of the books, records, documents and other materials relating to the Purchased Assets, except for those books, records, documents and other materials that are Excluded Assets;

3.3.6     the Company, Cohen and Blake shall enter into Patent Assignment Agreements with the Purchaser in a form customary in transactions similar to the transaction contemplated herein and satisfactory to the parties to such Patent Assignment Agreements.

3.3.7      the Company and the Purchaser shall also execute and deliver all such instruments, documents and certificates as may be reasonably requested by the other Party that are necessary, appropriate or desirable for the consummation at the Closing of the transactions contemplated by this Agreement.

3.4        The Company’s Closing Deliveries.   Subject to and conditioned upon the Closing, on or prior to the Closing Date, the Company shall have delivered to the Purchaser all of the following:

3.4.1      copies of all third party and governmental consents, approvals, filings, releases and terminations required in connection with the consummation of the transactions contemplated herein;

3.4.2     a certificate of the Secretary of State of the State of Florida that the Company is in good standing in such State;

3.4.3     Secretary’s certificate regarding the approval of the Agreement and transactions by the Company’s board of directors;

3.4.4     aletter by Adorno & Yoss, LLP , counsel to the Company, or another counsel reasonably satisfactory to the Purchaser substantially in the form attached hereto as Exhibit B ; and

3.4.6      such other documents, instruments or certificates (including customary incumbency and bring down certificates) as the Purchaser may reasonably request to effect the transactions contemplated hereby.

3.5        The Purchaser’s Closing Deliveries .  Subject to and conditioned upon the Closing, on or prior to the Closing Date, the Purchaser shall have delivered to the Company, all of the following:

3.5.1     certificate of the Secretary of State of Illinois providing that the Purchaser is in good standing;

3.5.2      Secretary’s Certificate regarding the approval of the Agreement and transactions by the Purchaser’s board of directors;

3.5.3     a letter by Freeborn & Peters, LLP, in form reasonably acceptable to the Company and the Company’s counsel  substantially in the form attached hereto as Exhibit C ; and

3.5.4     such other documents, instruments or certificates (including customary incumbency and bring down certificates) as the Company may reasonably request to effect the transactions contemplated hereby.

3.6        Conditions to the Purchaser’s Obligations.   The obligations of the Purchaser to consummate the transactions contemplated by this Agreement are subject to the satisfaction of the following conditions as of the Closing Date:

3.6.1     the representations and warranties set forth in Article IV shall be true and correct in all material respects at and as of the Closing Date as though then made and as though the Closing Date were substituted for the date of this Agreement throughout such representations and warranties;

3.6.2     the Company shall have performed and complied in all material respects with all of the covenants and agreements required to be performed by it under this Agreement on or prior to the Closing;

3.6.3     the transactions contemplated by this Agreement shall not be prohibited by any applicable law or governmental regulation, shall not subject the Purchaser to any penalty, liability or other materially adverse condition under or pursuant to any applicable law or governmental regulation, and shall be permitted by laws and regulations of the jurisdictions to which the Purchaser is subject;

3.6.4     no action, suit, or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction or before any arbitrator wherein an unfavorable judgment, decree, injunction, order or ruling would prevent the performance of this Agreement or any of the transactions contemplated hereby, declare unlawful the transactions contemplated by this Agreement, cause such transactions to be rescinded or materially and adversely affect the right of the Purchaser to own the Purchased Assets, and no judgment, decree, injunction, order or ruling shall have been entered which has any of the foregoing effects;

3.6.5     the Company   shall have received proper termination statements (Form UCC-3) necessary to terminate the effectiveness of any financing statements filed with respect to the Purchased Assets;

3.6.6     the Purchaser shall have received all material permits, licenses, registrations and other governmental approvals required for the Purchaser’s operation of the Business and occupation of the Premises (including without limitation all permits, licenses, registrations and other governmental approvals required under Environmental Laws), provided, that the Purchaser has used commercially reasonable efforts to file applications to obtain or, to the extent any of the Company’s material permits, licenses, registrations or other governmental authorizations are transferable to the Purchaser and included in the Purchased Assets, to file requests to transfer, reissue or modify, any such permits, licenses, registrations and approvals;

3.6.7     the Purchaser shall have received all necessary approvals from its board of directors to consummate the transactions contemplated hereby;

3.6.8     the Purchaser shall have received all necessary approvals from Silicon Valley Bank to consummate the transactions contemplated hereby; and

3.6.9      the Purchaser shall have received, in writing, the right to co-occupy the premises leased by the Company in Florida following the Closing pursuant to the terms set forth in the stipulation between the Company and the landlord of such Florida premises dated February 10, 2005.  Additionally, the Purchaser shall have entered into a new sublease with Breg, Inc. for the premises subleased by the Company in California on substantially similar economic terms and conditions  to those currently in place between the Company, and the Purchaser shall have received a waiver from the landlord of such California premises

Any condition specified in this Section 3.6  may be waived pre-Closing by the Purchaser; provided that no such waiver shall be effective against the Purchaser unless it is set forth in a written instrument executed by the Purchaser.  In the event that the Purchaser elects to consummate the transactions contemplated by this Agreement even though certain of the conditions set forth in this Section 3.6  have not been satisfied, upon the Closing, any conditions in Section 3.6  that have not otherwise been satisfied shall be identified in a writing to be signed by the Parties and considered waived by the Purchaser.

3.7        Conditions to the Company’s Obligations .  The obligations of the Company to consummate the transactions contemplated by this Agreement are subject to the satisfaction of the following conditions as of the Closing Date:

3.7.1     the representations and warranties set forth in Article V shall be true and correct in all material respects at and as of the Closing Date as though then made and as though the Closing Date were substituted for the date of this Agreement throughout such representations and warranties;

3.7.2     the Purchaser shall have performed and complied in all material respects with all of the covenants and agreements required to be performed by it under this Agreement on or prior to the Closing;

3.7.3     the transactions contemplated by this Agreement shall not be prohibited by any applicable law or governmental regulation, shall not subject the Company to any penalty, liability or other materially adverse condition under or pursuant to any applicable law or governmental regulation, and shall be permitted by laws and regulations of the jurisdictions to which the Company is subject; and

3.7.4     no action, suit, or proceeding shall be pending before any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction or before any arbitrator wherein an unfavorable judgment, decree, injunction, order or ruling would prevent the performance of this Agreement or any of the transactions contemplated hereby, declare unlawful the transactions contemplated by this Agreement, cause such transactions to be rescinded or materially and adversely affect the right of the Company to retain the Purchase Price, including the Closing Payment and the Good Faith Deposit , and no judgment, decree, injunction, order or ruling shall have been entered which has any of the foregoing effects.

Any condition specified in this Section 3.7  may be waived by the Company provided that no such waiver shall be effective against the Company unless it is set forth in a writing executed by the Company.  In the event that the Company elect to consummate the transactions contemplated by this Agreement even though certain of the conditions set forth in this Section 3.7  have not been satisfied, upon the Closing, any conditions in Section 3.7  that have not otherwise been satisfied shall be identified in a writing to be signed by the Parties and considered waived by the Company.

3.8        Affirmative Covenants of the Company .  Prior to the Closing, unless the Purchaser otherwise agrees in writing and except as expressly contemplated by this Agreement, the Company shall, except as set forth in the schedules to this Agreement, conduct the Business and operations only in the ordinary course of business, consistent with past practice.  Notwithstanding the foregoing, the Company shall obtain consent from the Purchaser before entering into any Contract or fulfilling any purchase and sales orders.

3.9        Negative Covenants of the Company .  Prior to the Closing, except as the Purchaser otherwise agrees in writing or as is expressly contemplated by this Agreement, the Company shall not:

3.9.1     establish or, except in the ordinary course of business consistent with past practice, contribute to any pension, retirement, profit sharing or stock bonus plan or multiemployer plan covering the employees of the Company;

3.9.2     enter into any material contract, agreement or transaction with third parties;

3.9.3     incur, guarantee, or become subject to any material liabilities;

3.9.4     acquire or dispose of any assets and properties used or held for use in the conduct of the Business or creating or incurring any Lien;

3.9.5     violate, breach or default under in any material respect, or take or fail to take any action that (with or without notice or lapse of time or both) would constitute a material violation or breach of, or default under, any term or provision of any Contract or any license;

3.9.6     make capital expenditures or commitments for additions to property, plant or equipment constituting capital assets on behalf of the Business in an aggregate amount; or

3.9.7     enter into any agreement to do or engage in any of the foregoing.

3.10      Covenants of the Purchaser .  Prior to the Closing, the Purchaser shall cooperate with the Company and use its reasonable best efforts to cause the conditions to the Company’s obligation to consummate the transactions contemplated by this Agreement to be satisfied, including, without limitation, the execution and delivery of all agreements contemplated hereunder to be so executed and delivered (including, without limitation, the making and obtaining of all third party and governmental filings, authorizations, approvals, consents, releases and terminations).

ARTICLE IV

Representations and Warranties of the Company

To induce the Purchaser to enter into this Agreement and to consummate the transactions contemplated hereunder, the Company makes the following representations and warranties.  All references to the “Company’s knowledge” or to words of similar import will be deemed to be references to the actual knowledge of its sole shareholder.

4.1        Organization, Power and Authority; Subsidiaries.

4.1.1      The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida and has all requisite corporate power and authority to own or lease its properties, to carry on its business as it is now being conducted and to enter into this Agreement and all other agreements contemplated hereby and to perform its obligations hereunder and thereunder.  The Company is legally qualified to transact business as a foreign corporation in each of the jurisdictions in which its business or property is such as to require that it be thus qualified, and it is in good standing in each of the jurisdictions in which it is so qualified and each such jurisdiction is listed on Schedule 4.1 .

4.1.2     The Company does not directly or indirectly own any capital stock of, or other equity interests in, any corporation, partnership, joint venture or other entity.

4.2        Due Authorization; Binding Obligation; No Conflicts.   The execution, delivery and performance of this Agreement and all other agreements contemplated hereby and the consummation of the transactions contemplated hereby have been duly authorized by all necessary corporate action of the Company.  This Agreement has been duly executed and delivered by the Company and is a valid and binding obligation of the Company enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency and other similar laws affecting the enforceability of creditor’s rights generally, general equitable principles and the discretion of courts in granting equitable remedies.  Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will: (a) contravene any provision of the Certificate of Incorporation or by-laws of the Company; (b) violate or conflict with any federal, state or local law, statute, ordinance, rule, regulation or any decree, writ, injunction, judgment or order of any court or administrative or other governmental body or of any arbitration award which is either applicable to, binding upon or enforceable against the Company, except for such violations or conflicts that, taken in the aggregate, could not reasonably be expected to have a material adverse effect upon the Company; or (c) conflict with, result in any breach of or default (or an event which would, with the passage of time or the giving of notice or both, constitute a default) under any material mortgage, contract, agreement, lease, license, indenture, will, trust or other instrument which is either binding upon or enforceable against the Company.

4.3        Financial Statements.  The Company previously has furnished to the Purchaser the following financial statements (the “ Financial   Statements ”) of the Company:

(a)        balance sheets as of December 3