ASSET PURCHASE AGREEMENT

Exhibit 10.146

ASSET PURCHASE AGREEMENT

Asset Purchase Agreement entered into as of May 17, 2007, by and among Empagio Acquisition LLC, a Delaware limited liability company (the “Buyer”), Empagio, Inc. a Delaware limited liability company (the “Seller”) and HALO Technology Holdings, Inc., a Nevada corporation (the “Parent”). The Buyer, the Parent and the Seller are referred to collectively herein as the “ Parties .”

The Parent owns one hundred percent (100%) of the issued and outstanding capital stock of the Seller. This Agreement contemplates a transaction in which the Buyer will purchase substantially all of the assets (and assume certain of the liabilities) of the Seller in return for cash and other consideration as set forth herein.

Now, therefore, in consideration of the premises and the actual promises herein made, and in consideration of the representations, warranties, and covenants herein contained, the Parties agree as follows.

Section 1. Definitions.

" Accountant ” shall have the meaning set forth in §2(g) below.

" Acquired Assets ” means all right, title, and interest in and to all of the assets of the Seller, including all of its (a) tangible personal property (such as supplies, equipment, furniture, automobiles, (b) agreements, contracts, indentures, mortgages, instruments, Security Interests, guaranties, other similar arrangements, and rights thereunder, (c) franchises, approvals, permits, licenses, orders, registrations, certificates, variances, exemptions, and similar rights obtained from governments and governmental agencies (the “ Permits ”), (d) Intellectual Property, goodwill associated therewith, licenses and sublicenses granted and obtained with respect thereto, and rights thereunder, remedies against infringements thereof, and rights to protection of interests therein under the laws of all jurisdictions, (e) any interest in any real property, fixtures, improvements, and fittings thereon, leaseholds and subleaseholds therein, and easements, rights-of-way, and other appurtenants thereto (such as appurtenant rights in and to public streets), (f) leases, subleases, and rights thereunder, (g) prepayments, prepaid expenses, and deferred items, claims, deposits, refunds, causes of action, chooses in action, rights of recovery, rights of set off, and rights of recoupment, (h) accounts, notes, and other receivables, and (i) books, records, ledgers, files, documents, correspondence, lists, plats, architectural plans, drawings, and specifications, creative materials, advertising and promotional materials, studies, reports, and other printed or written materials, AND (j) Cash and all other material assets necessary to operate the business of the Seller as conducted by it prior to the Closing Date; provided , however , that the Acquired Assets shall not include (i) the items as set forth on Exhibit A attached hereto and all rights thereunder (the “ Excluded Assets ”), (ii) 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 of the Seller as a corporation, or (iii) any of the rights of the Seller under this Agreement.

" Adjusted Purchase Price ” shall have the meaning set forth in §2(g)(ii) below.

" Adverse Consequences ” means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and fees, including court costs and reasonable attorneys’ fees and expenses. For the avoidance of doubt, Adverse Consequences shall not include any liability of Seth Bernstein or Chatham Capital Partners LLC, Chatham Investment Fund III, LLC, for their own actions or failure to act, as a result of being named as defendants in Crestview Capital Partners LLC v. Halo Technology Holdings, Inc., Empagio, Inc. Chatham Capital Partners LLC, Chatham Investment Fund III, LLC and Seth Bernstein, Circuit Court of Cook County, Illinois, County Department, Chancery Division, Case No. 07CH12078.

" Affiliate ” has the meaning set forth in Rule 12b-2 of the regulations promulgated under the Securities Exchange Act.

" Affiliated Group ” means any affiliated group within the meaning of Code Sec. 1504.

“ Agreement ” this Asset Purchase Agreement.

" Assumed Liabilities ” means (a) all trade account payables and accrued expenses of the Seller which are listed on Exhibit B hereto (which Exhibit shall exclude liabilities of the Seller related to any Litigation ), (b) all trade account payables and accrued expenses of the Seller which have arisen in the ordinary course of business since the date of the Most Recent Fiscal Month End, (c) all obligations of the Seller under the agreements, contracts, leases, licenses, and other arrangements referred to in the definition of Acquired Assets, and (d) all other Liabilities and obligations of the Seller set forth in an Appendix to the Disclosure Schedule; provided , however, that the Assumed Liabilities shall not include (i) any Liability of the Seller for unpaid Taxes or for income, transfer, sales, use, and other Taxes arising in connection with the consummation of the transactions contemplated hereby, (ii) any obligation of the Seller to indemnify any Person (including the Parent) by reason of the fact that such Person was a director, officer, employee, or agent of the Seller or was serving at the request of any such entity as a partner, trustee, director, officer, employee, or agent of another entity (whether such indemnification is for judgments, damages, penalties, fines, costs, amounts paid in settlement, losses, expenses, or otherwise and whether such indemnification is pursuant to any statute, charter document, bylaw, agreement, or otherwise), (iii) all Liabilities and obligations of the Seller under its Employee Benefit Plans, (iv) all Liabilities and obligations relating to the Excluded Assets (including accounts payable and accrued expenses), (v) all liabilities and obligations relating to funded indebtedness of the Seller, (vi) any Liability of the Seller for costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby, or (vii) any obligation which should have been performed by Seller prior to the Closing Date or (viii) any Liability or obligation of the Seller under this Agreement.

" Buyer ” has the meaning set forth in the preface above.

" Cash ” means cash and cash equivalents (including marketable securities and short term investments) calculated in accordance with GAAP applied on a basis consistent with the preparation of the Financial Statements.

“ Cash Consideration ” the meaning set forth in §2(c)(i) below.

" Closing ” has the meaning set forth in §2(d) below.

" Closing Date ” has the meaning set forth in §2(d) below.

" Closing Date Balance Sheet ” has the meaning set forth in §2(g)(ii) below.

“ Closing Payment ” the meaning set forth in §2(c)(iii).

" Code ” means the Internal Revenue Code of 1986, as amended.

" Compensation Program ” shall have the meaning set forth in §9(b) below.

“ Contingent Payment ” shall have the meaning set forth in §2(c)(iv) below.

" Controlled Group of Corporations ” has the meaning set forth in Code Sec. 1563.

“ Deferred Payment Date ” has the meaning set forth in §2(C)(i).

“ Deferred Payments ” has the meaning set forth in §2(C)(i).

“ Deposit ” means the $250,000 deposited by the Buyer with the Seller on the date of execution of this Agreement and any interest accrued thereon.

" Disclosure Schedule ” has the meaning set forth in §3 below.

“ Domain Names ” means Internet electronic addresses, uniform resource locators and

alphanumeric designations associated therewith registered with or assigned by any domain name registrar, domain name registry or other domain name registration authority as part of an electronic address on the Internet and all applications for any of the foregoing.

" Draft Closing Date Balance Sheet ” has the meaning set forth in §2(g) below.

" Employee Benefit Plan ” means any (a) nonqualified deferred compensation or retirement plan or arrangement which is an Employee Pension Benefit Plan, (b) qualified defined contribution retirement plan or arrangement which is an Employee Pension Benefit Plan, (c) qualified defined benefit retirement plan or arrangement which is an Employee Pension Benefit Plan (including any Multiemployer Plan), (d) Employee Welfare Benefit Plan, or (e) any bonus, incentive, severance, stock option, stock purchase, short-term disability plan or other material fringe benefit plan, program or arrangement, including policies concerning holidays, vacations and salary continuation during short absences for illness or otherwise.

" Employee Pension Benefit Plan ” has the meaning set forth in ERISA Sec. 3(2).

" Employee Welfare Benefit Plan ” has the meaning set forth in ERISA Sec. 3(1).

" Environmental Health. and Safety Laws ” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, the Resource Conservation and Recovery Act of 1976, the Clean Air Act, the Federal Water Pollution Control Act, the Safe Drinking Water Act, the Toxic Substance Control Act, the Emergency Planning and Community Right-to-Know Act of 1986, the Hazardous Material Transportation Agreement, and the Occupational Safety and Health Act of 1970, each as amended, together with all other laws (including rules, regulations, codes, plans, injunctions, judgments, orders, decrees, rulings, and charges thereunder) of federal, state, local, and foreign governments (and all agencies thereof) concerning pollution or protection of the environment, public health and safety, or employee health and safety, including laws relating to emissions, discharges, releases, or threatened releases of pollutants, contaminants, or chemical, industrial, hazardous, or toxic materials (including petroleum products and asbestos) or wastes into ambient air, surface water, ground water, or lands or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handing of pollutants, contaminants, or chemical, industrial, hazardous, or toxic materials or wastes (“ Hazardous Substances ”).

" ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

" Estimated Net Working Capital ” shall mean the Seller’s good faith estimate of its Net Working Capital as of the Closing Date as set forth on a certificate signed by an officer of the Seller delivered to the Buyer.

" Fiduciary ” has the meaning set forth in ERISA Sec. 3(21).

" Financial Statements ” has the meaning set forth in §3(g)

" Excluded Assets ” has the meaning set forth in the definition of Acquired Assets.

" GAAP ” means United States generally accepted accounting principles as in effect from time to time.

" Guarantor ” has the meaning set forth in the definition of “Guaranty” hereunder.

“ Guaranty ” means the guaranty of the Buyer’s obligations dated the hereof executed by Seth Bernstein (the “Guarantor”) in favor of the Seller, the form of which is attached as Exhibit D-1 hereto.

" Hazardous Substances ” has the meaning set forth in the definition of Environmental, Health, and Safety Laws.

“ Holdback ” has the meaning set forth in §2(c)(i).

" Indemnified Party ” has the meaning set forth in §8(d) below.

" Indemnifying Party ” has the meaning set forth in §8(d)(i) below.

“ Information Systems” means all computer hardware, databases and data storage systems, computer, data, database and communications networks (other than the Internet), architecture interfaces and firewalls (whether for data, voice, video or other media access, transmission or reception) and other apparatus used to create, store, transmit, exchange or receive information in any form.

“I nitial Purchase Price ” has the meaning set forth in §2(c)(i).

" Intellectual Property ” means (a) all trade secrets and confidential business information (including customer and supplier lists, ideas, research and development, know-how, formulas, compositions, and techniques, technical data, designs, drawings, specifications, pricing and cost information, and business and marketing plans and proposals), (b) all trademarks, service marks, trade dress, logos, trade names, and corporate names, together with all translations, adaptations, derivations, and combinations thereof and including all goodwill associated therewith, and all applications, registrations, and renewals in connection therewith, (c) all inventions (whether patentable or unpatentable and whether or not reduced to practice), all improvements thereto, and all patents, patent applications, and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions, and reexaminations thereof, (d) all copyrightable works, all copyrights, and all applications, registrations, and renewals in connection therewith, (e) all mask works and all applications, registrations, and renewals in connection therewith, (f) all Software (including data and related documentation), (g) all other proprietary rights, (h) all copies and tangible embodiments thereof (in whatever form or medium), and (h) all Domain Names.

“ Interest Period ” means a period commencing on the date specified in §2(c) and ending on the date specified in §2(c) except that (i) each such Interest Period that commences on the last business day of a calendar month (or on any day for which there is no numerically corresponding day in the appropriate subsequent calendar month) shall end on the last business day of the appropriate subsequent calendar month; and (ii) if an Interest Period would end on a day that is not a London business day, such Interest Period shall be extended to the next business day unless such London business day would fall in the next calendar month, in which event such Interest Period shall end on the immediately preceding business day.

“ Liability ” means any liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes.

“ LIBOR ” means the LIBOR Interest Rate that is the offered rate for deposits of U.S. Dollars in an amount approximately equal to the amount of the unpaid Deferred Payments for an Interest Period specified in §2(c) which the British Bankers’ Association fixes as its LIBOR rate as of 11:00 a.m. London time on the day which is two London banking days prior to each date the LIBOR is set pursuant to §2(c). If such day is not a London banking day, LIBOR shall be determined on the next preceding day which is a London banking day. If for any reason the parties cannot determine such offered rate by the British Bankers’ Association, the parties shall mutually agree on a replacement index based on the arithmetic mean of the quotations, if any, of the interbank offered rate by first class banks in London or New York for deposits in comparable amounts and maturities.

“ Limited Guaranty ” means the limited guaranty dated the date hereof of the Buyer’s obligations hereunder, including payment of the Deferred Payments and the Contingent Payment executed by the Guarantor in favor of the Seller, the form of which is attached as Exhibit D-2 hereto.

“ Litigation ” the meaning set forth in §3(t).

" Most Recent Balance Sheet ” means the balance sheet contained within the Most Recent Financial Statements.

" Most Recent Financial Statements ” has the meaning set forth in §3(g) below.

" Most Recent Fiscal Month End ” has the meaning set forth in §3(g) below.

" Most Recent Fiscal Year End ” has the meaning set forth in §3(g) below.

" Multiemployer Plan ” has the meaning set forth in ERISA Sec. 3(37).

" Net Working Capital ” means the sum of Seller’s cash and cash equivalents, accounts receivable (net of allowances for doubtful accounts), prepaid expenses (and not including any amounts due to Parent or any other Affiliate of the Seller), and other current assets, but not including any amounts due from Parent or any other Affiliate of the Seller, all of which are Acquired Assets less the sum of accounts payable, accrued liabilities (not including any amounts due the Parent or any other Affiliate of the Seller and specifically excluding liabilities related to deferred revenue), and other current liabilities, all of which are Assumed Liabilities, all as shown on the Closing Date Balance Sheet. Net Working Capital shall be calculated as set forth on Exhibit C .

“ Non-Competition and Related Assignments ” has the meaning set forth in §6(a)(vi) below.

“ Object Code ” means computer software that is substantially or entirely in binary form and that is intended to be directly executable by a computer after suitable processing and linking but without any intervening steps of compilation or assembly.

“ Parent ” has the meaning in the preface above.

" Party ” has the meaning set forth in the preface above.

" PBGC ” means the Pension Benefit Guaranty Corporation.

" Permits ” has the meaning set forth in the definition of Acquired Assets.

" Person ” means an individual, a partnership, a corporation, an association., a joint stock company, a limited liability company or partnership, a trust, a joint venture, an unincorporated organization, or a governmental entity (or any department, agency, or political subdivision thereof).

" Preliminary Purchase Price ” has the meaning set forth §2(c)

" Prohibited Transaction ” has the meaning set forth in ERISA Sec. 406 and Code Sec. 4975.

" Reportable Event ” has the meaning set forth in ERISA Sec.

4043.

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

" Securities Exchange Act ” means the Securities Exchange Act of 1934, as amended.

" Security Interest ” means any lien, encumbrance, mortgage, pledge, charge, or other security interest.

" Seller ” has the meaning set forth in the preface above.

“ Software ” means all computer software and code, including assemblers, applets,

compilers, Source Code, Object Code, development tools, design tools, user interfaces and data, in any form or format, however fixed. For purposes of this Agreement, Software includes all software that is in the development, transition or similar phase.

“Source Code ” computer software that may be displayed or printed in human readable form, including all related programmer comments, annotations, flowcharts, diagrams, help text, data and data structures, instructions, procedural, object oriented or other human readable code, and that is not intended to be executed directly by a computer without an intervening step of compilation or assembly.

" Subsidiary ” means any corporation with respect to which a specified Person (or a Subsidiary thereof) owns a majority of the common stock or has the power to vote or direct the voting of sufficient securities to elect a majority of the directors.

" Tax ” means any federal, state, local, or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental (including taxes under Code Sec. 59A), customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including and interest, penalty, or addition thereto, whether disputed or not.

“ Tax Return ” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any Exhibit or attachment thereto, and including any amendment thereof.

" Third Party Claim ” has the meaning set forth in 8(c)(i) below.

“ Transferred Employees ” has the meaning set forth in §9(b)(i) below.

Section 2. Basic Transaction .

(a)  Purchase and Sale of Assets. At the Closing, and on and subject to the terms and conditions of this Agreement, the Buyer agrees to purchase from the Seller, and the Seller agrees to sell, transfer, convey, and deliver to the Buyer, all of the Acquired Assets free and clear of any Security Interests for the consideration with respect to the Acquired Assets specified below in this §2.

(b)  Assumption of Liabilities . On and subject to the terms and conditions of this Agreement, the Buyer agrees to assume and become responsible for all of the Assumed Liabilities at the Closing. The Buyer will not assume or have any responsibility, however, with respect to any other obligation or Liability of the Seller not included within the definition of Assumed Liabilities.

(c)  Purchase Price .

(i) The aggregate initial purchase price to be paid by the Buyer for the Acquired Assets is $16,000,000 (the “ Initial Purchase Price ”), paid as follows. On the date of execution of this Agreement, Buyer has paid to Seller the Deposit, and at the Closing, Buyer shall pay over to the Seller $13,750,000 in cash (the “ Cash Consideration ”) $250,000 of such Cash Consideration (the “Holdback”) shall be deposited on the Closing Date with Rogin, Nassau, Caplan, Lassman & Hirtle, LLC (“Rogin”) . On each of September 30, 2008 and June 30, 2009 (each a “Deferred Payment Date”), Buyer shall pay to Seller (or Seller’s designee) the sum of $1,000,000 in cash (the “Deferred Payments”) plus simple interest accrued on such Deferred Payments from the Closing Date at a per annum rate of LIBOR plus 4% per annum (the “Rate”). The Rate shall continue to accrue on any unpaid principal balance of the Deferred Payments only for so long as any portion of the Deferred Payment remains unpaid. On the Closing Date through the fifteen month anniversary thereof (such anniversary date being the “Change Date”), the Rate shall equal the LIBOR for an Interest Period of 12 months. On the Change Date through June 30, 2009, the Rate shall convert to LIBOR for an Interest Period of nine (9) months. There shall be no prepayment penalty if Buyer prepays the Deferred Payments. Seller’s right to the Deferred Payments and any Contingent Payment shall be an unsecured obligation of the Buyer and subordinated to the senior lender and Chatham Capital and/or its successors and/or assigns and shall at all times rank junior and subordinate to any present or future secured indebtedness of the Buyer and any extension, amendment, or additional or replacement financing thereof. If the Buyer (or the business purchased hereunder) is sold (by stock sale, merger (if Buyer is not the surviving entity), sale of all or substantially all of its assets or otherwise) any unpaid Deferred Payments shall be due and payable upon the closing of such sale.

(ii) Not later than five (5) business days prior to the Closing Date, the Seller shall deliver to the Buyer (i) a pro forma consolidated estimate of the Acquired Assets and Assumed Liabilities as of the Closing Date and an unaudited consolidated statement of the Acquired Assets and Assumed Liabilities as of the close of business on the most recent month, prepared in conformity with GAAP and (ii) and the Estimated Net Working Capital. If the Estimated Net Working Capital is less than $517,550 (such shortfall being a “ Working Capital Underage ”), the Buyer shall subtract the amount of the Working Capital Underage from the Initial Purchase Price. If the Estimated Net Working Capital exceeds $517,000 (the “ Working Capital Excess ”), then the Buyer shall add the amount of the Working Capital Excess to the Initial Purchase Price paid at Closing. The Initial Purchase Price, reduced or increased, as the case may be, by a Working Capital Excess or a Working Capital Underage, is herein referred to as the “ Preliminary Purchase Price ”).

(iii) At the Closing, the Buyer will purchase the Purchased Assets from Seller and will assume the Assumed Liabilities, upon and subject to the terms and conditions of this Agreement and in reliance upon the representations, warranties covenants and agreements of the Seller contained herein, and will pay or cause to be paid to the Seller the Cash Consideration (the “ Closing Payment ”) by wire transfer of immediately available funds at the Closing to such account(s) designated in writing by the Seller at least three (3) business days prior to the Closing Date.

(iv) If the Buyer is sold (by stock sale, merger, sale of all or substantially all of its assets or otherwise) prior to the fifth (5 ^th ) anniversary of the Closing Date, Buyer and/or its stockholders shall cause to be paid to Seller or Seller’s successors or assigns from the proceeds of the sale and not later than that date of the closing of the sale an amount equal to (x) ten percent (10%) of the proceeds of such sale, reduced by (y) $1.0 million (the “ Contingent Payment ”). Proceeds of the sale means, the sum of the aggregate (A) amount of cash consideration paid for Buyer (or its assets), (B) implied value of any equity interest retained in the acquiring company by Buyer or its members, (C) value of any assets retained by the Buyer after the sale, (D) amount of any seller financing provided by the Buyer or its members in connection with the transaction and (E) amount of any other quantifiable consideration included as part of a transaction to be received by the Buyer or its members (in their sole capacity as such) in connection with the transaction (i.e., deferred payments) minus (F) the costs or other expenses incurred in connection with such transaction, including, without limitation, any Tax liability incurred by the Buyer. The Contingent Payment shall rank in priority of payment on a pari passu basis with that of the holders of the Buyer’s common equity The portions of the net proceeds of the sale described in (C), (D), and/or (E) may be paid when such amounts are received. For purposes of this §2(c)(iv), the term “net proceeds” shall mean the proceeds of such sale reduced by the costs of such sale, payment of all debt which is prior to right to the Buyer’s equity and payment of all equity senior in right to the Buyer’s common equity.

(d)  The Closing . The closing of the transactions contemplated by this Agreement (the " Closing ”) shall take place at the offices of Rogin, Nassau, Caplan, Lassman & Hirtle, LLC, CityPlace 1, 22 ^nd Floor, 185 Asylum Street, Hartford, Connecticut 06103, commencing at 9:00 a.m. local time on the second business day following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective Parties will take at the Closing itself) or such other date as the Parties may mutually determine (the “ Closing Date ”); provided, however, that the Closing Date shall be no later than May 18, 2007; provided, however, that the Buyer may extend such Closing Date to May 25, 2007, at its sole discretion. Notwithstanding the foregoing, the Buyer shall pay to the Seller the sum of $10,000 for each business day commencing on May 21, 2007, through May 25, 2007 (to a maximum of $50,000, such total being the “Extension Payments”), so long as the parties hereto have not consummated the Closing. Notwithstanding the foregoing, if the Buyer may terminate this Agreement pursuant to §7(a)(ii) hereunder at any time during the period from May 21, 2007, through May 25, 2007, the Buyer shall not be liable for any Extension Payments. The Extension Payments shall be made to Seller on the Closing Date with the Cash Consideration.

(e)  Deliveries at the Closing . At the closing, (i) the Seller will deliver to the Buyer the various certificates, instruments, and documents referred to in §6(a) below; (ii) the Buyer will deliver to the Seller the various certificates, instruments, and documents referred to in §6(b) below; (iii) the Seller will execute, acknowledge (if appropriate), and deliver to the Buyer (A) assignments (including real property and Intellectual Property transfer documents) in the forms attached hereto as Exhibits E-1 through E-       and (B) such other instruments of sale, transfer, conveyance, and assignment as the Buyer and its counsel may request; (iv) the Buyer will execute, acknowledge (if appropriate), and deliver to the Seller (A) an assumption in the form attached hereto as Exhibit F and (B) such other instruments of assumption as the Seller and its counsel may reasonably request

(f)  Allocation . The Parties agree to allocate the Preliminary Purchase Price (and all other capitalizable costs) among the Acquired Assets for all purposes (including financial accounting and tax purposes) in accordance with the allocation Exhibit attached hereto as Exhibit G, as amended to reflect any adjustment as provided herein.

(g)  Post-Closing Adjustment for Net Working Capital.

(i) Within 60 days after the Closing Date, the Buyer will prepare and deliver to the Seller (x) a draft consolidated balance sheet (the “ Draft Closing Date Balance Sheet ”) for the Acquired Assets and the Assumed Liabilities as of the close of business on the Closing Date, and (y) a computation and determination of the Net Working Capital, and (z) a computation and determination of the Adjusted Purchase Price in accordance with the provisions of this §2(g). The Buyer will prepare the Draft Closing Date Balance Sheet in accordance with GAAP (other than exceptions to GAAP noted in the definition of Net Working Capital).

(ii) If the Seller has any objections to the Draft Closing Date Balance Sheet, it will deliver a detailed statement describing its objections to the Buyer within 30 days after receiving the Draft Closing Date Balance Sheet. The Buyer and the Seller will use reasonable efforts to resolve any such objections themselves. If the Parties do not obtain a final resolution within 30 days after the Buyer has received the statement of objections, however, the Buyer and the Seller will select an accounting firm mutually acceptable to them to resolve any remaining objections. If the Buyer and the Seller are unable to agree on the choice of an accounting firm, they will select a nationally-recognized accounting firm by lot (the “ Accountant ”) which shall be jointly instructed by the Buyer and the Seller to determine the Net Working Capital and the Adjusted Purchase Price. The Accountant shall deliver to each of the Buyer and the Seller its determinations within 30 days after receiving the joint instructions from the Buyer and the Seller, and the determinations of the Accountant will be forth in writing and will be conclusive and binding upon the Parties. The expenses of the Accountant shall be born equally by the Buyer and the Seller. The Buyer will give the Seller the Draft Closing Date Balance Sheet, revised to reflect the Accountant’s determinations. The “ Closing Date Balance Sheet ” shall mean the Draft Closing Date Balance Sheet, together with any revisions thereto pursuant to this § 2(g) (ii), including the determination of the Accountant. The “ Adjusted Purchase Price ” shall mean the Preliminary Purchase Price, together with any revisions thereto pursuant to this §2(g) (ii), including the determination of the Accountant.

(iii) The Buyer will make the work papers and back-up materials used in preparing the Draft Closing Date Balance Sheet available to the Seller and its accountants and other representatives at reasonable times and upon reasonable notice at any time during (A) the preparation by the Buyer of the Draft Closing Date Balance Sheet, (B) the review by the Seller of the Draft Closing Balance Sheet, and (C) the resolution by the Parties of any objection thereto.

(iv) The Adjusted Purchase Price will be determined by adjusting the Preliminary Purchase Price as follows:

(A) The Preliminary Purchase Price will be increased by the amount, if any, by which the Net Working Capital exceeds the Estimated Net Working Capital; and

(B) The Preliminary Purchase Price will be decreased by the amount, if any, by which the Net Working Capital is less than the Estimated Net Working Capital.

(v) If the Adjusted Purchase Price exceeds the Preliminary Purchase Price, the Buyer shall pay to the Seller an amount in cash equal to such excess by delivery of cash payable by wire transfer or delivery of other immediately available funds. If the Adjusted Purchase Price is less than the Preliminary Purchase Price, (i) Rogin shall distribute to the Buyer, from the Holdback, an amount in cash equal to such deficiency and (ii) if the deficiency exceeds the Holdback, the Seller shall pay to the Buyer by delivery of cash payable by wire transfer or delivery of other immediately available funds the amount by which the deficiency exceeds the Holdback. After any required distributions of the Holdback are made to the Buyer pursuant to the preceding sentence, the balance of the Holdback (if any) shall be disbursed to the Seller. In connection with the distribution of the Holdback, the parties hereunder shall provide such joint instructions as Rogin shall require. Such payment shall be made no later than five business days after (A) the 30th day after the Draft Closing Date Balance Sheet has been given by the Buyer to the Seller, if the Seller has not objected to the Draft Closing Date Balance Sheet within such 30 day period; (B) the Buyer and the Seller have resolved any objection raised by the Seller; or (C) the date the determination of the Accountant described in clause (ii) above is given to the Buyer and the Seller.

Section 3. Representations and Warranties of the Seller and the Parent .

The Seller and the Parent jointly and severally represent and warrant that the statements contained in this §3 are correct and complete as of the date of this Agreement and except for representations and warranties which are made as to a date certain will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement), except as set forth in the disclosure schedule accompanying this Agreement (the “Disclosure Schedule”). The Disclosure Schedule will be arranged in paragraphs corresponding to the lettered and number paragraphs contained in this §3.

(a)  Organization; Capitalization . Each of the Parent and the Seller is a corporation duly organized, validly existing, and in good standing under the laws of the jurisdiction of its incorporation. The Parent is the sole shareholder of the Seller. There are no outstanding or authorized options, warrants, purchase rights, subscription rights, exchange rights, or other contracts or commitments that require the Seller to issue, sell, or otherwise cause to become outstanding any of its capital stock.

(b)  Authorization of Transaction . Each of the Seller and the Parent has full power and authority (including full corporate power and authority) to execute and deliver this Agreement and to perform its obligations hereunder. Without limiting the generality of the foregoing, the board of directors of the Seller and the Parent has each duly authorized the execution, delivery, and performance of this Agreement by each of the Seller and the Parent. This Agreement constitutes the valid and legally binding obligation of the Seller and the Parent, enforceable in accordance with its terms and conditions.

(c)  Noncontravention . Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby (including the assignments and assumptions referred to in §2 above), will violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any government, governmental agency, or court to which the Parent or the Seller is subject or any provision of the charter or bylaws of any of the Seller or the Parent. Other than as would not reasonably be expected to have a material adverse effect on the Acquired Assets, the execution and the delivery of this Agreement, and the consummation of the transactions contemplated hereby will not conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any material agreement, contract, lease, license, instrument, or other arrangement to which any of the Seller, or the Parent is a party or by which it is bound or to which any of its assets is subject (or result in the imposition of any Security Interest upon any of its assets). Neither the Seller nor the Parent needs to give any notice to, make any filing with, or obtain any authorization, consent, or approval of any government or governmental agency in order for the Parties to consummate the transactions contemplated by this Agreement (including the assignments and assumptions referred to in §2 above), except as set forth on §3(c) of the Disclosure Schedule.

(d)  Brokers’ Fees . Neither the Seller nor the Parent has any Liability or obligation to pay any fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which the Buyer could become liable or obligated.

(e)  Title to Assets . The Seller has good and marketable title to, or a valid leasehold interest in, the properties and assets used by them, located on their premises, or shown on the Most Recent Balance Sheet or acquired after the date free and clear of all Security Interests, except for properties and assets disposed of in the ordinary course of business since the date of such Most Recent Balance Sheet. Without limiting the generality of the foregoing, the Seller has good and marketable title to all of the Acquired Assets, free and clear of any Security Interest or restriction on transfer.

(f)  Subsidiaries . The Seller has no Subsidiary of any kind.

(g)  Financial Statements . Attached hereto as Exhibit H are the following financial statements (collectively, the “Financial Statements”): (i) consolidated and consolidating balance sheets and statements of income, changes in stockholders’ equity, and cash flow as of and for the fiscal year ended June 30, 2006 (the “Most Recent Fiscal Year End”) for the Seller; and (ii) unaudited consolidated and consolidating balance sheet and statements of income, changes in stockholders’ equity, and cash flow (the “Most Recent Financial Statements”) as of and for the period ending April 30, 2007 (the “Most Recent Fiscal Month End”) for the Seller. The Financial Statements (including the notes thereto) have been prepared in accordance with GAAP applied on a consistent basis throughout the periods covered thereby, present fairly the financial condition of the Seller as of such dates and the results of operations of the Seller for such periods are correct and complete, and are consistent with the books and records of the Seller (which books and records are correct and complete).

(h)  Events Subsequent to Most Recent Fiscal Year End . Since the Most Recent Fiscal Year End, there has not been any material adverse change in the business, financial condition, operations, results of operations, or future prospects of any of the Seller. Since the Most Recent Fiscal Month End, the Seller has conducted its respective businesses only in the ordinary and usual course, and except as set forth in §3(h) of the Disclosure Schedule, there have not occurred any of the events set forth in §5(d) hereof.

(i)  Undisclosed Liabilities . The Seller has no Liability (and there is no basis for any Liability), except for (i) Liabilities set forth on the Most Recent Financial Statements; and (ii) Liabilities which have arisen after the Most Recent Fiscal Month End in the ordinary course of business .

(j)  Legal Compliance . The Seller and its respective predecessors and Affiliates have complied with all applicable laws (including rules, regulations, codes, plans, injunctions, judgments, orders, decrees, rulings, and charges thereunder) of federal, state, local, and foreign governments (and all agencies thereof), except where any non-compliance would reasonably be expected to not have a material adverse effect on the business or operations of the Acquired Assets, and no action, suit, proceeding, hearing, investigation, charge, complaint, claim, demand, or notice has been filed or commenced against any of them alleging any failure so to comply.

(k)  Tax Matters .

(i) The Seller has filed all Tax Returns that it was required to file. To the Seller’s knowledge, all such Tax Returns were correct and complete, all Taxes owed by the Seller have been paid and there is no dispute or claim concerning any Tax Liability of the Seller either (A) claimed or raised by any authority in writing or (B) as to which the Seller has knowledge. The Seller is not currently the beneficiary of any extension of time within which to file any Tax Return. To Seller’s knowledge, no claim has ever been made by an authority in a jurisdiction where any of the Seller does not file Tax Returns that it is or may be subject to taxation by that jurisdiction. There are no Security Interests on any of the assets of any of the Seller that arose in connection with any failure (or alleged failure) to pay any Tax.

(ii) The Seller has withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder, or other third party.

(iii) The Seller has not waived any statute of limitations in respect of Taxes or agreed to any extension of time with respect to a Tax assessment or deficiency.

(iv) The Seller has not made any payments, is not obligated to make any payments, or is a party to any agreement that under certain circumstances could obligate it to make any payments that will not be deductible under Code Sec. 280G. The Seller has not been a United States real property holding corporation within the meaning of Code Sec. 897(c)(2) during the applicable period specified in Code Sec. 997(c) (1) (A) (ii). The Seller is not a party to any Tax allocation or sharing agreement. The Seller (A) is not a member of an Affiliated Group filing a consolidated federal income Tax Return (other than a group the common parent of which was the Parent) and (B) has no Liability for the Taxes of any Person under Treas. Reg. §1.1502-6 (or any similar provision of state, local, or foreign law), as a transferee or successor, by contract, or otherwise.

(1)  Real Property .

(i) The Seller owns no real property.

(ii) §3(l)(ii) of the Disclosure Schedule lists and describes briefly all real property leased or subleased to or by the Seller. The Seller has made available to the Buyer correct and complete copies of the leases and subleases listed in §3(l) (ii) of the Disclosure Schedule (as amended to date). With respect to each lease and sublease listed in §3(l) (ii) of the Disclosure Schedule:

(A) the lease or sublease is legal, valid, binding, enforceable, and in full force and effect against the Seller;

(B) to Seller’s knowledge no party to the lease or sublease is in breach or default, and no event has occurred which, with notice or lapse of time, would constitute a breach or default or permit termination, modification, or acceleration thereunder;

(C) to Seller’s knowledge no party to the lease or sublease has repudiated any provision thereof;

(D) the Seller has not assigned,