BRIDGE LOAN AGREEMENT

                                                                        EX-10.38

                              BRIDGE LOAN AGREEMENT


              THIS BRIDGE LOAN  AGREEMENT,  dated as of September  28, 2006,  is
entered into by and between Sonoma College,  Inc., a California corporation with
headquarters  located  at 1304  South  Point  Boulevard,  Suite  280,  Petaluma,
California 94954 (the "Company"), and Harborview Master Fund Lp (the "Lender").

                              W I T N E S S E T H:

              WHEREAS,  the Company and the Lender are executing and  delivering
this  Agreement  in  accordance  with and in reliance  upon the  exemption  from
securities  registration for offers and sales to accredited  investors afforded,
INTER ALIA, by Rule 506 under  Regulation D  ("Regulation  D") as promulgated by
the United  States  Securities  and  Exchange  Commission  (the "SEC") under the
Securities Act of 1933, as amended (the "1933 Act"),  and/or Section 4(2) of the
1933 Act; and

              WHEREAS,  the Lender wishes to lend funds to the Company,  subject
to and upon the terms and  conditions of this  Agreement and  acceptance of this
Agreement by the Company,  the  repayment  of which will be  represented  by 10%
Secured Promissory Note of the Company (the "Note"), on the terms and conditions
referred to herein; and

              WHEREAS, in connection with the loan to be made by the Lender, the
Company has agreed to cause the Issued  Shares (as  defined  below) to be issued
and/or transferred to the Lender; and

              WHEREAS,  the  Company's  obligations  to repay  the Note  will be
secured by certain real estate (the "Real Estate")  pledged by Charles D. Newman
and Elysa K. Newman (each a "Pledgor" and together,  the "Pledgors") pursuant to
separate Security Interest and Pledge Agreements (the "Pledge Agreements"),  and
by a mortgage (the "Mortgage") executed by the Pledgors in favor of the Lender.

              NOW  THEREFORE,  in  consideration  of the premises and the mutual
covenants  contained  herein  and other  good and  valuable  consideration,  the
receipt and sufficiency of which are hereby  acknowledged,  the parties agree as
follows:

              1.     AGREEMENT TO PURCHASE; PURCHASE PRICE.

              a.     PURCHASE.

              (i)    Subject to the terms and  conditions of this  Agreement and
the  other  Transaction  Agreements,  the  Lender  hereby  agrees to loan to the
Company $275,000 (the "Loan Amount").
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              (ii)   The  obligation  to repay the loan from the Lender shall be
evidenced by the Company's  issuance of the Note, which shall be shall be in the
form of ANNEX I annexed  hereto.  The Note will be secured by the Mortgage under
the terms of the Pledge  Agreements and Mortgage,  which Pledge Agreements shall
be  substantially  in the  form of ANNEX  VI  hereto,  which  the  Company  will
acknowledge.

              (iii)  In consideration of the loan to be made by the Lender,  the
Company  agrees  to issue to the  Lender  the  Issued  Shares  and the  Warrant.
Additional provisions relating to the Issued Shares and the Warrant are provided
below.

              (iv)   The loan to be made by the Lender and the  issuance  of the
Note and Warrant to the Lender and the  issuance  and/or  transfer of the Issued
Shares  to the  Lender  and  the  other  transactions  contemplated  hereby  are
sometimes  referred  to herein and in the other  Transaction  Agreements  as the
purchase  and sale of the  Securities  (as defined  below),  and are referred to
collectively as the "Transactions".

              b.     CERTAIN DEFINITIONS.  As used herein, each of the following
terms has the meaning set forth below, unless the context otherwise requires:

              "Additional  Issued Shares" means 1,527,777 shares of Common Stock
(half of which shall be restricted  and half of which shall be  free-trading  or
subject to  piggy-back  registration  rights) to be issued by the Company to the
Lender on  December  29,  2006 in the event  that the Note is not  repaid in its
entirety on or before such date.

              "Affiliate"  means,  with respect to a specific Person referred to
in the relevant provision, another Person who or which controls or is controlled
by or is under common control with such specified Person.

              "Certificates"  means the original  ink-signed Note and the Issued
Share Certificates, each duly executed by the Company and issued in the name of,
or in the case of the Share  Certificates,  duly endorsed or accompanied by duly
executed stock powers for transfer to, the Lender.

              "Closing Date" means the date of the closing of the  Transactions,
as provided herein.

              "Common Stock  Equivalents" means any securities of the Company or
the  Subsidiaries  which would entitle the holder thereof to acquire at any time
Common Stock,  including without limitation,  any debt, preferred stock, rights,
options,  warrants or other  instrument that is at any time  convertible into or
exchangeable  for, or otherwise  entitles the holder thereof to receive,  Common
Stock.

              "Company Control Person" means each director,  executive  officer,
promoter,  and such other  Persons  as may be deemed in  control of the  Company
pursuant  to Rule  405  under  the 1933  Act or  Section  20 of the 1934 Act (as
defined below).
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              "Disclosure  Annex"  means  ANNEX V to this  Agreement;  provided,
however,  that the Disclosure Annex shall be arranged in sections  corresponding
to the  identified  Sections of this  Agreement,  but the disclosure in any such
section of the Disclosure Annex shall qualify other provisions in this Agreement
to the extent that it would be readily  apparent  to an  informed  reader from a
reading of such  section of the  Disclosure  Annex that it is also  relevant  to
other provisions of this Agreement.

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

              "Holder" means the Person  holding the relevant  Securities at the
relevant time.

              "Issued Share  Certificates"  means one or more stock certificates
issued by the Company in the name of the Lender representing,  in the aggregate,
the Issued Shares and the Additional Issued Shares if required.

              "Issued  Shares" " means $137,500  worth of Common Stock,  half of
which shall be restricted and half of which shall be  free-trading or subject to
piggy-back registration rights.

              "Last Audited Date" means December 31, 2005.

              "Lender  Control Person" means each director,  executive  officer,
promoter,  and such  other  Persons  as may be deemed in  control  of the Lender
pursuant to Rule 405 under the 1933 Act or Section 20 of the 1934 Act.

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

              "Material Adverse Effect" means an event or combination of events,
which  individually  or in the  aggregate,  would  reasonably be expected to (w)
adversely affect the legality,  validity or  enforceability of the Securities or
any of the  Transaction  Agreements,  (x) have or result in a  material  adverse
effect on the results of operations,  assets, prospects, or condition (financial
or  otherwise)  of the  Company  and its  subsidiaries,  taken as a  whole,  (y)
adversely  impair the  Company's  ability to perform fully on a timely basis its
obligations  under  any  of  the  Transaction  Agreements  or  the  transactions
contemplated  thereby,  or (z) materially and adversely  affect the value of the
rights granted to the Lender in the Transaction Agreements.

              "Person"  means any living person or any entity,  such as, but not
necessarily limited to, a corporation, partnership or trust.

              "Principal  Trading  Market"  means the Over the Counter  Bulletin
Board or such other  market on which the Common Stock is  principally  traded at
the relevant time, but shall not include the "pink sheets."

              "Registrable  Securities"  means  all of the  following:  (i)  the
Issued Shares, (ii) the Warrant Shares and (iii) the Additional Issued Shares in
the event such shares are  issued,  except to the extent such shares can then be
sold by the Holder without volume or other restrictions or limits.
<PAGE>


              "Registration Rights Provisions" means the piggy-back registration
rights contemplated by the terms of this Agreement,  if any, including,  but not
necessarily  limited  to,  Section  4(g)  hereof,  and of the other  Transaction
Agreements.

              "Registration Statement" means an effective registration statement
covering the Registrable Securities.

              "Securities" means the Note and the Shares.

              "Shares" means the shares of Common Stock  representing any or all
of the Issued Shares,  the Additional Issued Shares in the event such shares are
issued, the Warrant Shares and, where relevant, the Pledged Shares.

              "State of Incorporation" means California.

              "Subsidiary"  means any  subsidiary of the Company as set forth on
the Disclosure Annex.

              "Subsidiary  Guarantee" means the Subsidiary Guarantee dated as of
September 1, 2006 between each Subsidiary and the Lender.

              "Trading  Day" means any day during  which the  Principal  Trading
Market shall be open for business.

              "Transaction  Fees" means legal and due diligence fees incurred by
the Lender.

              "Transfer  Agent" means,  at any time,  the transfer agent for the
Company's Common Stock.

              "Transaction  Agreements"  means this Bridge Loan  Agreement,  the
Note,  the Subsidiary  Guarantee,  the Pledge  Agreements,  the Mortgage and the
Warrant and includes all ancillary documents referred to in those agreements.

              "VWAP" means,  for any date, the price  determined by the first of
the following  clauses that  applies:  (a) if the Common Stock is then listed or
quoted on a Trading  Market,  the daily  volume  weighted  average  price of the
Common  Stock  for such  date (or the  nearest  preceding  date) on the  primary
Trading Market on which the Common Stock is then listed or quoted as reported by
Bloomberg Financial L.P. (based on a Trading Day from 9:30 a.m. EST to 4:02 p.m.
Eastern Time) using the VAP function; (b) if the Common Stock is not then listed
or quoted on the  Trading  Market and if prices  for the  Common  Stock are then
reported in the "Pink  Sheets"  published by the Pink Sheets,  LLC (or a similar
organization  or agency  succeeding to its functions of reporting  prices),  the
most recent bid price per share of the Common Stock so  reported;  or (c) in all
other cases, the fair market value of a share of Common Stock as determined by a
nationally  recognized-independent  appraiser  selected in good faith by Holders
holding a majority of the principal amount of Notes then outstanding.
<PAGE>


              "Warrant  Shares"  means  shares of Common  Stock  underlying  the
Warrant.

              c.     FORM OF PAYMENT; DELIVERY OF CERTIFICATES.

              (i)    The  Lender  shall  pay  the  Loan  Amount  by   delivering
immediately  available good funds in United States Dollars to the Company on the
Closing Date.

              (ii)   No later than one (1) business  day from the Closing  Date,
the Company shall deliver the Certificates,  each duly executed on behalf of the
Company to the Lender.

              (iii)  By  signing  this  Agreement,  each of the  Lender  and the
Company agrees to all of the terms and conditions of the Transaction  Documents,
all of the provisions of which are  incorporated  herein by this reference as if
set forth in full.

              d.     METHOD OF PAYMENT. Payment of the Loan Amount shall be made
by wire transfer of funds to:

                     LAW OFFICE OF ISAAC M. ZUCKER, PLLC
                     ATTORNEY TRUST ACCOUNT
                     BANK: CITIBANK, N.A.
                     ADDRESS: 600 OLD COUNTRY ROAD
                     GARDEN CITY, NY 11530
                     ABA ROUTING NO.: 021001486
                     ACCOUNT NO.: 065641284

       The Company shall issue disbursement  instructions to effectuate transfer
of funds from the above-referenced account.

              2.     LENDER   REPRESENTATIONS,   WARRANTIES,   ETC.;  ACCESS  TO
INFORMATION; INDEPENDENT INVESTIGATION.

              The Lender  represents  and warrants to, and  covenants and agrees
with, the Company as follows:

              a.     Without  limiting  Lender's  right to sell  the  Securities
pursuant to an effective  registration statement or otherwise in compliance with
the 1933 Act, the Lender is purchasing  the  Securities  for its own account for
investment  only and not with a view  towards  the public  sale or  distribution
thereof and not with a view to or for sale in connection  with any  distribution
thereof.

              b.     The Lender is (i) an "accredited  investor" as that term is
defined in Rule 501 of the General Rules and  Regulations  under the 1933 Act by
reason of Rule  501(a)(3),  (ii)  experienced in making  investments of the kind
described in this Agreement and the related documents,  (iii) able, by reason of
the  business  and  financial  experience  of its  officers  (if an entity)  and
professional  advisors (who are not affiliated with or compensated in any way by
the  Company or any of its  Affiliates  or selling  agents),  to protect its own
interests in connection with the transactions

<PAGE>


described  in this  Agreement,  and the related  documents,  and to evaluate the
merits and risks of an investment in the Securities, and (iv) able to afford the
entire loss of its investment in the Securities.

              c.     All  subsequent  offers and sales of the  Securities by the
Lender shall be made pursuant to registration of the relevant  Securities  under
the 1933 Act or pursuant to an exemption from registration.

              d.     The  Lender  understands  that  the  Securities  are  being
offered and sold to it in reliance on specific  exemptions from the registration
requirements  of the 1933 Act and state  securities laws and that the Company is
relying upon the truth and accuracy of, and the Lender's  compliance  with,  the
representations,  warranties, agreements,  acknowledgments and understandings of
the Lender  set forth  herein in order to  determine  the  availability  of such
exemptions and the eligibility of the Lender to acquire the Securities.

              e.     The Lender and its advisors,  if any,  have been  furnished
with or have  been  given  access to all  materials  relating  to the  business,
finances and  operations of the Company and materials  relating to the offer and
sale of the Securities which have been requested by the Lender,  including those
set forth on in any annex attached hereto. The Lender and its advisors,  if any,
have been  afforded  the  opportunity  to ask  questions  of the Company and its
management  and have  received  complete  and  satisfactory  answers to any such
inquiries. Without limiting the generality of the foregoing, the Lender has also
had the  opportunity  to obtain  and to review  the  Company's  filings on EDGAR
listed on ANNEX IV hereto (the documents  listed on such Annex IV, to the extent
available  on EDGAR or  otherwise  provided to the Lender as  indicated  on said
Annex IV, collectively, the "Company's SEC Documents").

              f.     The  Lender   understands   that  its   investment  in  the
Securities involves a high degree of risk.

              g.     The Lender hereby  represents  that, in connection with its
purchase of the Securities, it has not relied on any statement or representation
by the Company or any of its  officers,  directors and employees or any of their
respective attorneys or agents, except as specifically set forth herein.

              h.     The Lender  understands  that no United  States  federal or
state agency or any other  government  or  governmental  agency has passed on or
made any recommendation or endorsement of the Securities.

              i.     This  Agreement  and the other  Transaction  Agreements  to
which the Lender is a party, and the  transactions  contemplated  thereby,  have
been duly and validly authorized, executed and delivered on behalf of the Lender
and are valid and binding  agreements  of the Lender  enforceable  in accordance
with their respective terms,  subject as to enforceability to general principles
of equity and to  bankruptcy,  insolvency,  moratorium  and other  similar  laws
affecting the enforcement of creditors' rights generally.
<PAGE>


              3.     COMPANY  REPRESENTATIONS,  ETC. The Company  represents and
warrants to the Lender as of the date  hereof and as of the  Closing  Date that,
except as otherwise  provided in the  Disclosure  Annex or in the  Company's SEC
Documents:

              a.     RIGHTS OF OTHERS AFFECTING THE  TRANSACTIONS.  There are no
preemptive  rights of any  shareholder  of the Company,  as such, to acquire the
Note, the Issued Shares or the Additional Issued Shares in the event such shares
are issued.  No party other than a Lender has a currently  exercisable  right of
first  refusal  which  would  be  applicable  to any or all of the  transactions
contemplated by the Transaction Agreements.

              b.     STATUS.  The  Company  is  a  corporation  duly  organized,
validly  existing  and  in  good  standing  under  the  laws  of  the  State  of
Incorporation and has the requisite corporate power to own its properties and to
carry on its business as now being conducted. The Company is duly qualified as a
foreign  corporation to do business and is in good standing in each jurisdiction
where the nature of the business  conducted  or property  owned by it makes such
qualification necessary,  other than those jurisdictions in which the failure to
so qualify would not have or result in a Material  Adverse  Effect.  The Company
has registered its stock and is obligated to file reports pursuant to Section 12
or Section  15(d) of the  Securities  and Exchange Act of 1934,  as amended (the
"1934 Act"). The Common Stock is, or immediately following the Closing Date will
be, quoted on the Principal Trading Market.  The Company has received no notice,
either oral or written,  with respect to the continued eligibility of the Common
Stock for such quotation on the Principal  Trading  Market,  and the Company has
maintained all requirements on its part for the continuation of such quotation.

              c.     AUTHORIZED SHARES.

       (i)    The   authorized   capital  stock  of  the  Company   consists  of
250,000,000  shares of Common  Stock,  $0.01 par value,  63,510,467 of which are
outstanding as of the date hereof.

       (ii)   All issued and  outstanding  shares of Common Stock have been duly
authorized and validly issued and are fully paid and non-assessable. The Company
has  sufficient  authorized  and  unissued  shares  of  Common  Stock  as may be
necessary to affect the issuance of the Shares on the Closing Date.

       (iii)  As of the Closing Date, the Shares shall have been duly authorized
by all necessary  corporate action on the part of the Company,  and, when issued
on the Closing Date or pursuant to other relevant  provisions of the Transaction
Agreements, in each case in accordance with their respective terms, will be duly
and  validly  issued,  fully paid and  non-assessable  and will not  subject the
Holder thereof to personal liability by reason of being such Holder.

              d.     TRANSACTION  AGREEMENTS AND STOCK.  This Agreement and each
of the other Transaction Agreements,  and the transactions contemplated thereby,
have been duly and validly  authorized by the Company,  this  Agreement has been
duly executed and  delivered by the Company and this  Agreement is, and the Note
and each of the other Transaction Agreements, when executed and delivered by the
Company,  will be, valid and binding  agreements of the Company  enforceable  in
accordance with their respective terms,  subject as to enforceability to general
principles of equity and

<PAGE>


to  bankruptcy,  insolvency,  moratorium,  and other similar laws  affecting the
enforcement of creditors' rights generally.

              e.     NON-CONTRAVENTION.  The  execution  and  delivery  of  this
Agreement  and each of the other  Transaction  Agreements  by the  Company,  the
issuance of the  Securities,  and the  consummation  by the Company of the other
transactions  contemplated  by this  Agreement,  each of the Notes and the other
Transaction  Agreements  do not and will not conflict with or result in a breach
by the Company of any of the terms or  provisions  of, or  constitute  a default
under (i) the certificate of  incorporation  or by-laws of the Company,  each as
currently  in effect,  (ii) any  indenture,  mortgage,  deed of trust,  or other
material  agreement or instrument to which the Company is a party or by which it
or any of its  properties or assets are bound,  including any listing  agreement
for the Common Stock except as herein set forth, or (iii) to its knowledge,  any
existing applicable law, rule, or regulation or any applicable decree, judgment,
or  order  of any  court,  United  States  federal  or  state  regulatory  body,
administrative  agency, or other governmental body having  jurisdiction over the
Company or any of its  properties  or assets,  except such  conflict,  breach or
default which would not have or result in a Material Adverse Effect.

              f.     APPROVALS.  No  authorization,  approval  or consent of any
court, governmental body, regulatory agency,  self-regulatory  organization,  or
stock  exchange or market or the  shareholders  of the Company is required to be
obtained by the  Company  for the  issuance  and sale of the  Securities  to the
Lender as contemplated by this Agreement, except such authorizations,  approvals
and consents that have been obtained.

              g.     FILINGS. None of the Company's SEC Documents contained,  at
the time they were filed,  any untrue statement of a material fact or omitted to
state any material fact  required to be stated  therein or necessary to make the
statements  made  therein in light of the  circumstances  under  which they were
made, not misleading.  Since December 31, 2005, the Company has timely filed all
requisite forms,  reports and exhibits thereto,  if any, required to be filed by
the Company with the SEC.

              h.     ABSENCE OF CERTAIN  CHANGES.  Since the Last Audited  Date,
there has been no material adverse change and no Material Adverse Effect, except
as disclosed in the Company's SEC Documents. Since the Last Audited Date, except
as provided in the Company's SEC Documents,  the Company has not (i) incurred or
become  subject to any  material  liabilities  (absolute or  contingent)  except
liabilities  incurred in the ordinary  course of business  consistent  with past
practices; (ii) discharged or satisfied any material lien or encumbrance or paid
any material  obligation  or  liability  (absolute  or  contingent),  other than
current liabilities paid in the ordinary course of business consistent with past
practices;  (iii) declared or made any payment or  distribution of cash or other
property to  shareholders  with  respect to its capital  stock,  or purchased or
redeemed,  or made any  agreements  to  purchase  or  redeem,  any shares of its
capital stock; (iv) sold,  assigned or transferred any other tangible assets, or
canceled  any debts  owed to the  Company  by any  third  party or claims of the
Company  against  any third  party,  except in the  ordinary  course of business
consistent with past practices; (v) waived any rights of material value, whether
or not in the ordinary course of business,  or suffered the loss of any material
amount of existing business;  (vi) made any increases in employee  compensation,
except in the ordinary course of business  consistent  with past  practices;  or
(vii)

<PAGE>


experienced  any material  problems with labor or management in connection  with
the terms and conditions of their employment.

              i.     FULL  DISCLOSURE.  To the best of the Company's  knowledge,
there is no fact known to the Company  (other than general  economic  conditions
known to the public  generally or as disclosed in the Company's  SEC  Documents)
that has not been  disclosed in writing to the Lender that would  reasonably  be
expected to have or result in a Material Adverse Effect.

              j.     ABSENCE  OF   LITIGATION.   There  is  no   action,   suit,
proceeding,  inquiry or  investigation  before or by any court,  public board or
body  pending  or,  to the  knowledge  of the  Company,  threatened  against  or
affecting the Company before or by any governmental authority or nongovernmental
department,  commission,  board, bureau,  agency or instrumentality or any other
person, wherein an unfavorable decision, ruling or finding would have a Material
Adverse Effect or which would  adversely  affect the validity or  enforceability
of, or the authority or ability of the Company to perform its obligations under,
any of the Transaction  Agreements.  The Company is not aware of any valid basis
for any such claim that (either  individually or in the aggregate with all other
such events and  circumstances)  could reasonably be expected to have a Material
Adverse  Effect.  There are no  outstanding or  unsatisfied  judgments,  orders,
decrees,  writs,  injunctions or stipulations to which the Company is a party or
by which it or any of its  properties  is bound,  that  involve the  transaction
contemplated  herein or that,  alone or in the  aggregate,  could  reasonably be
expect to have a Material Adverse Effect.

              k.     ABSENCE  OF  EVENTS  OF  DEFAULT.  Except  as set  forth in
Section  3(e)  and  3(g)  hereof,  (i)  neither  the  Company  nor  any  of  its
subsidiaries  is in default in the  performance  or  observance  of any material
obligation,   agreement,   covenant  or  condition  contained  in  any  material
indenture,  mortgage, deed of trust or other material agreement to which it is a
party or by which its  property  is bound,  and (ii) no Event of Default (or its
equivalent term), as defined in the respective agreement to which the Company or
its subsidiary is a party, and no event which,  with the giving of notice or the
passage of time or both,  would  become an Event of Default  (or its  equivalent
term) (as so defined in such agreement),  has occurred and is continuing,  which
would have a Material Adverse Effect.

              l.     ABSENCE  OF  CERTAIN  COMPANY  CONTROL  PERSON  ACTIONS  OR
EVENTS.  To the Company's  knowledge,  none of the following has occurred during
the past five (5) years with respect to a Company Control Person:

       (1)    A  petition  under  the  federal  bankruptcy  laws  or  any  state
       insolvency  law was filed by or against,  or a receiver,  fiscal agent or
       similar  officer was appointed by a court for the business or property of
       such Company Control Person, or any partnership in which he was a general
       partner at or within two years  before  the time of such  filing,  or any
       corporation or business  association of which he was an executive officer
       at or within two years before the time of such filing;

       (2)    Such Company Control Person was convicted in a criminal proceeding
       or is a named subject of a pending criminal proceeding (excluding traffic
       violations and other minor offenses);
<PAGE>


       (3)    Such Company Control Person was the subject of any order, judgment
       or decree, not subsequently reversed,  suspended or vacated, of any court
       of competent jurisdiction, permanently or temporarily enjoining him from,
       or otherwise limiting, the following activities:

              (i)    acting, as an investment  advisor,  underwriter,  broker or
              dealer in  securities,  or as an  affiliated  person,  director or
              employee  of  any  investment  company,  bank,  savings  and  loan
              association  or  insurance   company,   as  a  futures  commission
              merchant, introducing broker, commodity trading advisor, commodity
              pool  operator,  floor broker,  any other Person  regulated by the
              Commodity  Futures Trading  Commission  ("CFTC") or engaging in or
              continuing  any  conduct  or  practice  in  connection  with  such
              activity;

              (ii)   engaging in any type of business practice; or

              (iii)  engaging in any activity in connection with the purchase or
              sale of any  security  or  commodity  or in  connection  with  any
              violation  of  federal  or  state   securities   laws  or  federal
              commodities laws;

       (4)    Such Company Control Person was the subject of any order, judgment
       or decree,  not  subsequently  reversed,  suspended  or  vacated,  of any
       federal or state authority barring,  suspending or otherwise limiting for
       more than 60 days the right of such Company  Control  Person to engage in
       any activity described in paragraph (3) of this item, or to be associated
       with Persons engaged in any such activity; or

       (5)    Such  Company  Control  Person  was found by a court of  competent
       jurisdiction in a civil action or by the CFTC or SEC to have violated any
       federal or state securities law, and the judgment in such civil action or
       finding by the CFTC or SEC has not been subsequently reversed, suspended,
       or vacated.

       m.     NO UNDISCLOSED LIABILITIES OR EVENTS. To the best of the Company's
knowledge,  the  Company  has no  liabilities  or  obligations  other than those
disclosed in the Transaction  Agreements or the Company's SEC Documents or those
incurred in the ordinary course of the Company's business since the Last Audited
Date,  or which  individually  or in the  aggregate,  do not or would not have a
Material Adverse Effect.  No event or circumstances  has occurred or exists with
respect  to the  Company  or its  properties,  business,  operations,  condition
(financial or otherwise), or results of operations, which, under applicable law,
rule or regulation, requires public disclosure or announcement prior to the date
hereof by the Company but which has not been so publicly announced or disclosed.
There are no proposals currently under consideration or currently anticipated to
be under  consideration  by the Board of Directors or the executive  officers of
the Company  which  proposal  would (x) change the  articles or  certificate  of
incorporation  or other  charter  document  or by-laws of the  Company,  each as
currently in effect,  with or without shareholder  approval,  which change would
reduce or otherwise  adversely  affect the rights and powers of the shareholders
of the Common Stock or (y)  materially  or  substantially  change the  business,
assets or capital of the Company, including its interests in subsidiaries.
<PAGE>


       n.     NO  INTEGRATED  OFFERING.  Neither  the  Company  nor  any  of its
Affiliates  nor any  Person  acting  on its or their  behalf  has,  directly  or
indirectly,  at any time since September 1, 2005, made any offer or sales of any
security or solicited any offers to buy any security  under  circumstances  that
would  eliminate the  availability  of the  exemption  from  registration  under
Regulation  D in  connection  with  the  offer  and  sale of the  Securities  as
contemplated hereby.

       o.     DILUTION.  The Issued Shares and the  Additional  Issued Shares in
the event such  shares are  issued may have a dilutive  effect on the  ownership
interests  of the other  shareholders  (and  Persons  having the right to become
shareholders)  of the Company.  The Company's  executive  officers and directors
have studied and fully understand the nature of the Securities being sold hereby
and  recognize  that they have such a potential  dilutive  effect.  The board of
directors of the Company has  concluded,  in its good faith  business  judgment,
that such issuance is in the best interests of the Company.

       p.     RESERVED.

       q.     FEES TO  BROKERS,  FINDERS  AND  OTHERS.  The Company has taken no
action  which  would  give  rise  to any  claim  by  any  Person  for  brokerage
commission,  finder's  fees or  similar  payments  by  Lender  relating  to this
Agreement  or  the  transactions  contemplated  hereby.  Lender  shall  have  no
obligation with respect to such fees or with respect to any claims made by or on
behalf of other Persons for fees of a type  contemplated  in this paragraph that
may be due in connection with the transactions  contemplated hereby. The Company
shall  indemnify  and hold  harmless each of Lender,  its  employees,  officers,
directors,  agents,  and partners,  and their  respective  Affiliates,  from and
against all claims,  losses,  damages, costs (including the costs of preparation
and  attorney's  fees) and  expenses  suffered in respect of any such claimed or
existing fees, as and when incurred.

       r.     CONFIRMATION.  The Company  confirms  that all  statements  of the
Company  contained  herein shall  survive  acceptance  of this  Agreement by the
Lender.  The Company  agrees that,  if any events occur or  circumstances  exist
prior to the Closing Date or the release of the Loan Amount to the Company which
would make any of the Company's representations, warranties, agreements or other
information set forth herein  materially  untrue or materially  inaccurate as of
such date, the Company shall immediately  notify the Lender (directly or through
its  counsel,  if any) in writing  prior to such date of such  fact,  specifying
which representation, warranty or covenant is affected and the reasons therefor.

       s.     AUTHORIZATION;   ENFORCEMENT.   The  Company  has  the   requisite
corporate  power and authority to enter into and to consummate the  transactions
contemplated  by each of the  Transaction  Agreements and otherwise to carry out
its  obligations  thereunder.   The  execution  and  delivery  of  each  of  the
Transaction  Agreements  by  the  Company  and  the  consummation  by it of  the
transactions  contemplated  thereby have been duly  authorized  by all necessary
action on the part of the  Company  and no  further  action is  required  by the
Company in  connection  therewith  other than in  connection  with the  Required
Approvals. Each Transaction Agreement has been (or upon delivery will have been)
duly  executed by the Company and, when  delivered in accordance  with the terms
hereof,  will  constitute  the  valid  and  binding  obligation  of the  Company
enforceable against the Company in

<PAGE>


accordance  with its terms  except  (i) as  limited  by  applicable  bankruptcy,
insolvency,  reorganization,  moratorium  and other laws of general  application
affecting enforcement of creditors' rights generally and (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or other
equitable remedies.

       t.     SEC  REPORTS;  FINANCIAL  STATEMENTS.  Other  than  as  previously
disclosed to the Lender,  the Company has filed all reports required to be filed
by it under the  Securities  Act and the  Exchange  Act,  including  pursuant to
Section 13(a) or 15(d) thereof,  for the two years preceding the date hereof (or
such shorter  period as the Company was  required by law to file such  material)
(the foregoing  materials,  including the exhibits thereto,  being  collectively
referred to herein as the "SEC  REPORTS")  on a timely  basis or has  received a
valid  extension of such time of filing and has filed any such SEC Reports prior
to the expiration of any such extension.  As of their respective  dates, the SEC
Reports  complied  in  all  material  respects  with  the  requirements  of  the
Securities  Act  and the  Exchange  Act and the  rules  and  regulations  of the
Commission  promulgated  thereunder,  and none of the SEC  Reports,  when filed,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated  therein or necessary in order to make the statements
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.  The  financial  statements  of the Company  comply in all  material
respects with applicable  accounting  requirements and the rules and regulations
of the Commission with respect thereto as in effect at the time of filing.  Such
financial  statements  have been  prepared  in  accordance  with  United  States
generally  accepted  accounting  principles applied on a consistent basis during
the periods  involved  ("GAAP"),  except as may be  otherwise  specified in such
financial  statements or the notes thereto and except that  unaudited  financial
statements may not contain all footnotes required by GAAP, and fairly present in
all material respects the financial position of the Company and its consolidated
subsidiaries  as of and for the dates thereof and the results of operations  and
cash