SECURITIES PURCHASE AGREEMENT

                                                                    Exhibit 10.6


               SECURITIES PURCHASE AGREEMENT (NOTES AND WARRANTS)

         SECURITIES   PURCHASE AGREEMENT (the "AGREEMENT"),   dated as of November
8,   2006,   by   and   among   Maritime   Logistics   US   Holdings   Inc.,   a   Delaware
corporation, with headquarters located at 547 Boulevard,   Kenilworth, New Jersey
("MLI" or the   "COMPANY"),   and the   investors   listed on the Schedule of Buyers
attached hereto (individually, a "BUYER" and collectively, the "BUYERS").

WHEREAS:

         A.   The   Company   and each   Buyer   is   executing   and   delivering   this
Agreement in reliance upon the exemption from securities   registration   afforded
by Section 4(2) of the Securities Act of 1933, as amended (the "1933 ACT"),   and
Rule 506 of Regulation D   ("REGULATION   D") as   promulgated by the United States
Securities and Exchange Commission (the "SEC") under the 1933 Act.

         B. Prior to the Closing (as defined   below) and   immediately   following
the   consummation   of the Share   Exchange (as defined   below),   the Company will
cause ShellCo (as defined below) to authorize a new series of its senior secured
convertible notes, which notes shall be convertible into ShellCo's common stock,
par value $0.001 per share (the "COMMON   STOCK") in accordance with the terms of
such notes.   "SHELLCO" is a corporation organized under the laws of the state of
Delaware   which has made a filing with the SEC on Form 10-SB,   a   subsidiary   of
which ("MERGER SUB") will be merged effective prior to Closing with and into the
Company,   with the Company   continuing as the surviving entity,   pursuant to the
terms of Section 6(o) (the   "MERGER").   ShellCo has   indicated   its intention to
change its name to Summit Global Logistics,   Inc. after the Merger and to effect
a reverse   split in respect of its Common   Stock in which each 11.226   shares of
Common   Stock prior to such reverse   split shall be   exchanged   for one share of
Common Stock after such reverse split (the "REVERSE SPLIT").

         C. The Buyers,   severally,   and not jointly, wish to purchase,   and the
Company   wishes ShellCo to sell,   upon the terms and   conditions   stated in this
Agreement, (i) secured convertible notes, in the form attached hereto as EXHIBIT
A, in an   aggregate   original   principal   amount   of   $65,000,000   (as   amended,
restated,   supplemented and/or modified from time to time in accordance with the
provisions    thereof,    collectively,    the   "NOTES")   and   (ii)   warrants,    in
substantially   the form   attached   hereto as   EXHIBIT B (as   amended,   restated,
supplemented and/or modified from time to time in accordance with the provisions
thereof, the "WARRANTS"), to acquire up to that number of shares of Common Stock
equal to the quotient of (a) 40% of the original   aggregate   principal amount of
the Notes   purchased   by the Buyers at   Closing   (as   defined   in Section   1(a))
divided by the Conversion Price (as defined in the Notes) as of the Closing (the
shares of Common Stock   issuable   upon   exercise of the   Warrants,   the "WARRANT
SHARES").

         D.   Contemporaneously   with the Closing (as defined below),   the Buyers
and   ShellCo   will   execute   and   deliver   a   Registration    Rights    Agreement,
substantially   in the form attached   hereto as EXHIBIT C (as amended,   restated,
supplemented and/or modified from time to time in accordance with the provisions
thereof, the "REGISTRATION   RIGHTS AGREEMENT"),   pursuant to which ShellCo shall
agree to provide certain   registration rights in respect of the shares of Common
Stock into which the Notes are   convertible   (the   "CONVERSION   SHARES") and the
Warrant

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Shares under the 1933 Act and the rules and regulations   promulgated thereunder,
and applicable state securities laws.

          E. The Notes,   the   Conversion   Shares,   the   Warrants   and the Warrant
Shares collectively are referred to herein as the "Securities".

         F.   The   Notes   will   rank   senior   to   all    outstanding    and   future
indebtedness of ShellCo,   subject to Permitted   Indebtedness   (as defined in the
Notes) and will be secured by a second priority   perfected   security interest in
substantially   all of the assets of ShellCo and the Company and in substantially
all of the shares of capital   stock and all the assets of each of ShellCo's   and
the Company's current and future   Subsidiaries (as defined below) other than the
escrowed   funds   referenced   in   subsection   (x) of the   definition of Permitted
Indebtedness set forth in Section 28 of the Note and the Subsidiaries   organized
outside the United States of America,   any of the States thereof or the District
of Columbia   (collectively,   the   "FOREIGN   SUBSIDIARIES"),   as evidenced by the
Pledge   Agreement in the form   attached   hereto as EXHIBIT D (as the same may be
amended, restated,   supplemented and/or modified from time to time in accordance
with the provisions thereof,   the "PLEDGE AGREEMENT") and the Security Agreement
in the form attached hereto as EXHIBIT E (as the same may be amended,   restated,
supplemented and/or modified from time to time in accordance with the provisions
thereof,   the "SECURITY   AGREEMENT")   and the Guaranty from the Company and each
Subsidiary   (other than Foreign   Subsidiaries)   in the form   attached   hereto as
EXHIBIT F (as the same may be amended,   restated,   supplemented   and/or modified
from time to time in accordance with the provisions thereof, the "GUARANTY", and
together with the Pledge   Agreement and the Security   Agreement,   as each may be
amended, restated,   supplemented and/or modified from time to time in accordance
with the provisions thereof, collectively the "SECURITY DOCUMENTS").

         G. In   connection   with the Merger   and the   Acquisitions   (as   defined
below),   (i)   ShellCo   shall   issue   shares of   Common   Stock   (the   "MANAGEMENT
RESTRICTED   STOCK") to certain   members of management   of ShellCo,   the Company,
Targets (as defined below) and their   Subsidiaries   (the "MANAGEMENT   MEMBERS"),
and (ii) each Management Member will execute and deliver a lockup agreement, the
form of which is attached   hereto as Exhibits   G-1, G-2 and G-3 (as the same may
be   amended,   restated,   supplemented   and/or   modified   from   time   to   time in
accordance with the provisions thereof,   the "LOCKUP   AGREEMENTS"),   pursuant to
which the resale of the Management Restricted Stock shall be limited.

         H.    Contemporaneously    herewith,   the   Company   is   entering   into   a
securities purchase agreement, by and among the Company and the buyers listed on
the Schedule of Buyers attached thereto (the "COMMON PIPE BUYERS"), (the "COMMON
PIPE SECURITIES PURCHASE Agreement"), wherein the Company agrees, upon the terms
and subject to the conditions of the Common PIPE Securities   Purchase Agreement,
to cause   ShellCo to issue and sell to the Common   PIPE   Buyers (i) no less than
30,000   shares   (after   giving   effect to the Reverse Split ) of Common Stock of
ShellCo (the   "COMMON   PIPE COMMON   SHARES"),   and (ii)   certain   warrants   (the
"COMMON PIPE WARRANTS"), which will be exercisable to purchase additional shares
of Common Stock (as exercised,   the "COMMON PIPE WARRANT   SHARES") in accordance
with the terms of the Common PIPE Warrants.

         I.   Contemporaneously   with the   Closing,   the Common   PIPE   Buyers and
ShellCo will execute and deliver a   Registration   Rights   Agreement (as amended,
restated,   supplemented and/or

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modified   from   time to time in   accordance   with the   provisions   thereof,   the
"COMMON PIPE   REGISTRATION   RIGHTS   AGREEMENT"),   pursuant to which ShellCo will
agree to provide   certain   registration   rights in   respect   of the Common   PIPE
Common   Shares and Common PIPE   Warrant   Shares under the 1933 Act and the rules
and regulations promulgated thereunder, and applicable state securities laws.

         J. The Common PIPE Common Shares,   Common PIPE Warrants and Common PIPE
Warrant   Shares   collectively   are   referred   to   herein   as   the   "COMMON   PIPE
SECURITIES", and the offering thereof, the "COMMON PIPE OFFERING".

         K. Immediately prior to the Closing, ShellCo shall enter into a joinder
agreement,   pursuant   to which   ShellCo   shall,   among other   things,   join this
Agreement,   affirm the   representations   and   warranties   hereunder and agree to
perform the   obligations   and   covenants   of the Company   hereunder   in the form
attached hereto as EXHIBIT H (as the same may be amended, restated, supplemented
and/or modified from time to time in accordance with the provisions thereof, the
"JOINDER AGREEMENT").   The Company's obligations   hereunder,   are subject to the
satisfaction of the condition that ShellCo enter into the Joinder Agreement.

         L. Contemporaneously   with the Closing,   ShellCo will enter into a loan
agreement,   by and   among   ShellCo,   the   Company,   Seamaster   Logistics,   Inc.,
Amerussia   Shipping Company Inc., Fashion Marketing Inc., FMI International LLC,
FMI International Corp. (West), FMI International Corp., Freight Management LLC,
FMI Trucking, Inc., FMI Express Corp., Clare Freight, Los Angeles, Inc., Tug New
York, Inc., Summit Global   Logistics,   Inc., TUG USA, Inc., AMR Investments Inc.
and FMI Holdco I, LLC and the lenders listed on the schedule of lenders   thereto
and Fortress Credit Corp. as   administrative   agent (as the same may be amended,
restated,   supplemented and/or modified from time to time in accordance with the
provisions thereof,   the "SENIOR LOAN AGREEMENT";   such loans evidenced thereby,
the "SENIOR   LOAN") under which   ShellCo and certain of its   subsidiaries   shall
have the   ability to obtain   term loans up to the   maximum   principal   amount of
$55,000,000 and revolving loans up to a maximum principal amount which shall not
exceed   $10,000,000 at any one time, in each case, upon the terms and subject to
the conditions set forth in the Senior Loan   Agreement.   The Senior Loan and the
obligations   related thereto shall rank senior to the Notes and shall be secured
by a first priority   perfected   security   interest in   substantially   all of the
assets of   ShellCo   and   substantially   all of the   assets of each of   ShellCo's
subsidiaries (other than Foreign   Subsidiaries),   including,   without limitation
the stock of each   Subsidiary   that is not a Foreign   Subsidiary   and 65% of the
voting stock and each first-tier Foreign Subsidiary.   The respective   priorities
and   preferences   of the Notes and the Senior Loan in respect of the   Collateral
(as   defined in the   Security   Documents   (as   defined   below)) are set forth in
detail in that certain Intercreditor and Subordination   Agreement by and between
Fortress Credit Corp., as collateral agent for the lenders under the Senior Loan
Agreement,   and the   Collateral   Agent (as defined   below) to be dated as of the
Closing Date,   substantially   in the form   attached   hereto as Exhibit I (as the
same may be amended, restated, supplemented and/or modified from time to time in
accordance with the provisions thereof, the "INTERCREDITOR AGREEMENT").

         M. Contemporaneously with, and as a condition, to the Closing, and with
certain of the proceeds of the transactions   contemplated hereby,   ShellCo shall
acquire,   directly or indirectly,   all (or   substantially   all) of the equity of
each   of   (i)   FMI   Holdco   I,   LLC,   a   Delaware   limited    liability    company
headquartered   at 800 Federal Blvd.,   Carteret,   New Jersey 07008 and

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certain of its parent companies   (collectively,   "FMI"), (ii) Clare Freight, Los
Angeles, Inc. a California corporation   headquartered at 17979 Arenth Ave., City
of Industry,   CA 91748,   and (iii) TUG New York,   Inc.,   a New York   corporation
headquartered at 13 Hendrickson   Ave.,   Lynbrook,   NY 11563 (together with Clare
Freight,   Los Angeles,   Inc.,   the "TUG   COMPANIES"   and together   with FMI, the
"TARGETS")   and   substantially   all of the assets of the TUG Logistics   group of
companies, including TUG Logistics, Inc., a California corporation headquartered
at 17971 Arenth Ave., City of Industry,   CA 91748, TUG Logistics (Miami), Inc. a
Florida   corporation   headquartered   at 2801 NW 74 Ave.,   Suite 173,   Miami,   FL
33122,   and Glare   Logistics,   Inc., a California   corporation   headquartered at
16905 South Keegan Ave., Carson, Los Angeles, CA 90746   (collectively,   the "TUG
ASSETS",   and the   acquisition of the TUG Assets and the Targets,   collectively,
the "ACQUISITIONS").

         NOW, THEREFORE, the Company and each Buyer hereby agree as follows:

         1. PURCHASE AND SALE OF NOTES AND WARRANTS.

                  (a) PURCHASE NOTES AND WARRANTS.   Subject to the   satisfaction
(or waiver) of the conditions   set forth in Sections 6 and 7 below,   the Company
shall cause ShellCo to issue and sell to each Buyer,   and each Buyer   severally,
but not jointly, agrees to purchase from ShellCo on the Closing Date (as defined
below),   (x) the principal   amount of Notes set forth opposite such Buyer's name
in column (3) on the Schedule of Buyers and (y) the related   Warrants to acquire
up to that number of Warrant   Shares set forth   opposite   such   Buyer's   name in
column (4) on the Schedule of Buyers (the "CLOSING").

                  (b) CLOSING.   The date and time of the Closing   (the   "CLOSING
DATE")   shall be 10:00   a.m.,   New York City   time,   on the first day other than
Saturday,   Sunday or other day on which commercial banks in the City of New York
are authorized or required by law to remain closed (a "BUSINESS   DAY") following
the satisfaction (or waiver) and notification of the Company of satisfaction (or
waiver) of the conditions to the Closing set forth in Sections 6 and 7 below (or
such later or earlier   date as is   mutually   agreed to by the Company and Buyers
holding the right to purchase at least 80% of the aggregate   principal amount of
the   Notes).   The   Closing   shall   occur on the   Closing   Date at the offices of
Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New York 10022.

                  (c) PURCHASE PRICE. The aggregate purchase price for the Notes
and the   Warrants   to be   purchased   by each   such   Buyer   at the   Closing   (the
"PURCHASE   PRICE")   shall be the amount set forth   opposite such Buyer's name in
column   (5) of the   Schedule   of Buyers.   Each   Buyer   shall pay $1,000 for each
$1,000 of principal amount of Notes and related Warrants to be purchased by such
Buyer at the Closing.

                  (d) FORM OF PAYMENT. On the Closing Date, (i) each Buyer shall
pay its respective   Purchase Price to ShellCo and/or to one or more designees of
ShellCo   for the Notes and   Warrants   to be issued and sold to such Buyer at the
Closing, by wire transfer of immediately   available funds in accordance with the
Company's   or   ShellCo's   written wire   instructions,   less any amount   withheld
pursuant to Section 4(f), and (ii) the Company shall cause ShellCo to deliver to
each Buyer the Notes   (allocated   in the   principal   amounts as such Buyer shall
request)   representing   such   principal   amount of the Notes which such Buyer is
then   purchasing   hereunder   along   with   warrants    representing   the   Warrants
(allocated   in the   amounts as such   Buyer   shall

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<PAGE>

request) which such Buyer is purchasing, in each case duly executed on behalf of
ShellCo and registered in the name of such Buyer or, subject to compliance   with
applicable securities laws, its designee.

         2. BUYER'S   REPRESENTATIONS   AND WARRANTIES.   Each Buyer represents and
warrants, severally and not jointly, as of the date of this Agreement and on the
Closing Date, with respect to only itself that:

                  (a) NO PUBLIC SALE OR   DISTRIBUTION.   Such Buyer is   acquiring
the Notes,   and the Warrants,   and upon   conversion of the Notes and exercise of
the Warrants will acquire the Conversion   Shares issuable upon conversion of the
Notes and the Warrant   Shares   issuable upon exercise   thereof,   in the ordinary
course of   business,   for its own   account and not with a view   towards,   or for
resale in   connection   with,   the public sale or   distribution   thereof,   except
pursuant to sales   registered or exempted under the 1933 Act and such Buyer does
not have a present   arrangement to effect any   distribution of the Securities to
or   through   any   person   or   entity;   PROVIDED,   HOWEVER,   that by   making   the
representations   herein, such Buyer does not agree to hold any of the Securities
for any minimum or other   specific term and reserves the right to dispose of the
Securities   at any   time   in   accordance   with   or   pursuant   to a   registration
statement   or an   exemption   under the 1933 Act and   pursuant to the   applicable
terms of the Transaction   Documents (as defined in Section 3(b)).   Such Buyer is
acquiring the Securities hereunder in the ordinary course of its business.   Such
Buyer does not   presently   have any   agreement   or   understanding,   directly   or
indirectly,   with any Person (as defined in Section 3(p)) to   distribute   any of
the Securities.

                  (b) ACCREDITED   INVESTOR STATUS.   Such Buyer is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D.

                   (c) RELIANCE ON EXEMPTIONS.   Such Buyer   understands   that the
Securities   are being offered and sold to it in reliance on specific   exemptions
from the registration requirements of United States federal and state securities
laws and that the Company is relying,   and ShellCo will rely,   upon, among other
things,   the truth and   accuracy   of,   and such   Buyer's   compliance   with,   the
representations,   warranties, agreements,   acknowledgments and understandings of
such   Buyer set forth   herein in order to   determine   the   availability   of such
exemptions and the eligibility of such Buyer to acquire the Securities.

                  (d)   INFORMATION.   Such Buyer and its   advisors,   if any, have
been   furnished   with all   materials   relating   to the   business,   finances   and
operations   of the Company and the Targets and   materials   relating to the offer
and sale of the Securities   which have been requested by such Buyer.   Such Buyer
and its advisors, if any, have been afforded the opportunity to ask questions of
the Company.   Neither such inquiries nor any other due diligence   investigations
conducted by such Buyer or its advisors,   if any, or its   representatives   shall
modify,    amend   or   affect   such   Buyer's    right   to   rely   on   the   Company's
representations and warranties contained herein. Such Buyer understands that its
investment   in the   Securities   involves   a high   degree   of risk and is able to
afford   a   complete   loss   of   such   investment.   Such   Buyer   has   sought   such
accounting,   legal and tax   advice   as it has   considered   necessary   to make an
informed investment decision in respect of its acquisition of the Securities.

                                       5
<PAGE>

                  (e) NO GOVERNMENTAL   REVIEW.   Such Buyer   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
or the fairness or suitability of the investment in the Securities nor have such
authorities   passed   upon   or   endorsed   the   merits   of   the   offering   of   the
Securities.

                  (f) TRANSFER OR RESALE.   Such Buyer understands that except as
provided in the Registration Rights Agreement:   (i) the Securities have not been
and are not being   registered   under the 1933 Act or any state   securities laws,
and may not be   offered   for sale,   sold,   assigned   or   transferred   unless (A)
subsequently   registered   thereunder,   (B) such Buyer   shall have   delivered   to
ShellCo an opinion of counsel,   in a form reasonably   acceptable to ShellCo,   to
the effect that such Securities to be sold, assigned or transferred may be sold,
assigned or transferred pursuant to an exemption from such registration,   or (C)
such Buyer provides ShellCo with assurance reasonably acceptable to ShellCo that
such   Securities can be sold,   assigned or   transferred   pursuant to Rule 144 or
Rule 144A   promulgated   under the 1933 Act,   as amended,   (or a   successor   rule
thereto)   (collectively,   "RULE 144");   (ii) any sale of the Securities   made in
reliance on Rule 144 may be made only in   accordance   with the terms of Rule 144
and further,   if Rule 144 is not applicable,   any resale of the Securities under
circumstances   in which the seller (or the Person through whom the sale is made)
may be deemed to be an underwriter (as that term is defined in the 1933 Act) may
require compliance with some other exemption under the 1933 Act or the rules and
regulations of the SEC thereunder; and (iii) none of ShellCo, the Company or any
other Person is under any obligation to register the   Securities   under the 1933
Act or any state   securities   laws or to comply with the terms and conditions of
any   exemption   thereunder.    Notwithstanding   the   foregoing,   and   subject   to
compliance   with   applicable   securities   laws, the Securities may be pledged in
connection   with   a   bona   fide   margin   account   or   other   loan   or   financing
arrangement secured by the Securities and such pledge of Securities shall not be
deemed to be a transfer, sale or assignment of the Securities hereunder,   unless
required by law, and no Buyer effecting a pledge of Securities shall be required
to provide   ShellCo with any notice   thereof or   otherwise   make any delivery to
ShellCo or the   Company   pursuant   to this   Agreement   or any other   Transaction
Document, including without limitation, this Section 2(f).

                  (g) LEGENDS.   Such Buyer   understands that the certificates or
other   instruments   representing   the   Notes   and the   Warrants   and   the   stock
certificates   representing the Conversion Shares and the Warrant Shares,   except
as set forth below,   shall bear any legend as required by the "blue sky" laws of
any state and a restrictive   legend in   substantially   the following form (and a
stop-transfer order may be placed against transfer of such certificates):

              [NEITHER THE ISSUANCE AND SALE OF THE   SECURITIES   REPRESENTED
              BY   THIS   CERTIFICATE   NOR THE   SECURITIES   INTO   WHICH   THESE
              SECURITIES   ARE   [CONVERTIBLE]   [EXERCISABLE]   HAVE   BEEN] THE
              SECURITIES   REPRESENTED   BY THIS   CERTIFICATE   HAVE   NOT   BEEN
              REGISTERED   UNDER THE SECURITIES   ACT OF 1933, AS AMENDED,   OR
              APPLICABLE   STATE   SECURITIES   LAWS. THE SECURITIES MAY NOT BE
              OFFERED FOR SALE,   SOLD,   TRANSFERRED   OR ASSIGNED   (I) IN THE
              ABSENCE OF (A) AN   EFFECTIVE   REGISTRATION   STATEMENT   FOR THE
              SECURITIES   UNDER THE SECURITIES

                                         6
<PAGE>

              ACT   OF   1933,   AS   AMENDED,   OR   (B) AN   OPINION   OF   COUNSEL
              REASONABLY    SATISFACTORY   TO   THE   ISSUER,    IN   A   GENERALLY
              ACCEPTABLE FORM, THAT   REGISTRATION IS NOT REQUIRED UNDER SAID
              ACT OR (II) UNLESS SOLD PURSUANT TO, AND IN   ACCORDANCE   WITH,
              RULE 144 OR RULE   144A   UNDER   SAID ACT.   NOTWITHSTANDING   THE
              FOREGOING,   SUBJECT TO COMPLIANCE WITH   APPLICABLE   SECURITIES
              LAWS, THE SECURITIES MAY BE PLEDGED IN CONNECTION   WITH A BONA
              FIDE   MARGIN   ACCOUNT OR OTHER LOAN OR   FINANCING   ARRANGEMENT
              SECURED BY THE   SECURITIES.   THIS INSTRUMENT IS SUBJECT TO THE
              TERMS OF A SECURITIES PURCHASE AGREEMENT (NOTES AND WARRANTS),
              DATED AS OF NOVEMBER 8, 2006, BY AND AMONG MARITIME   LOGISTICS
              US   HOLDINGS   INC.,   THE BUYERS   LISTED   THEREIN   AND   AEROBIC
              CREATIONS,   INC.   PURSUANT TO THAT CERTAIN JOINDER   AGREEMENT,
              DATED AS OF NOVEMBER 8, 2006, AND AN   INTERCREDITOR   AGREEMENT
              BY AND BETWEEN LAW   DEBENTURE   TRUST   COMPANY OF NEW YORK,   ON
              BEHALF OF THE HOLDER OF THIS NOTE AND OF THE OTHER NOTES,   AND
              FORTRESS    CREDIT   CORP.    AS   AGENT   (OR   ANY    SUCCESSOR   OR
              REPLACEMENT AGENT),   DATED AS OF NOVEMBER 8, 2006 (AS THE SAME
              MAY BE AMENDED,   SUPPLEMENTED,   RESTATED,   NOVATED OR REPLACED
              (INCLUDING IN CONNECTION WITH   REPLACEMENT   SENIOR   FINANCING)
              FROM TIME TO TIME, THE "INTERCREDITOR AGREEMENT").

The   legend   set   forth   above   shall   be   removed   and   ShellCo   shall   issue a
certificate without such legend to the holder of the Securities upon which it is
stamped or, in the case of Conversion   Shares or Warrant   Shares,   issue to such
holder   by   electronic   delivery   at   the   applicable   balance   account   at   The
Depository   Trust   Company   ("DTC"),   if,   unless   otherwise   required   by state
securities   laws,   (i) such   Securities are registered for resale under the 1933
Act,   provided that (A) upon receipt of notice from ShellCo that the   applicable
registration   statement   is not,   or no longer is   effective   in   respect of the
resale of such Securities,   the Holder will not transfer such Securities   (other
than pursuant to clauses 2(g)(ii) or 2(g)(iii) below) until ShellCo notifies the
Holder that the applicable registration statement becomes effective (again), and
(B) the Holder   hereby   agrees to indemnify   severally   and not jointly and hold
ShellCo   harmless   against any claim of securities laws violations in respect of
any such transfer (from and after the date the Holder   receives the first notice
described   in Section   2(g)(i)(A)   above   through   the date on which such Holder
receives the second notice described in Section 2(g)(i)(A) above) by such Holder
of any   Security as to which such legend has been   removed,   (ii) in   connection
with a sale, assignment or other transfer,   such holder provides ShellCo with an
opinion of counsel reasonably satisfactory to ShellCo, in a generally acceptable
form, to the effect that such sale, assignment or transfer of the Securities may
be made without   registration under the applicable   requirements of the 1933 Act
and that such   legend is no   longer   required,   or (iii)   such   holder   provides
ShellCo with assurances reasonably acceptable to ShellCo that the Securities can
be sold,   assigned or   transferred   pursuant

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<PAGE>

to Rule 144 or Rule 144A,   and such Holder   delivers the legended   Securities to
ShellCo or ShellCo's transfer agent.

                  (h) VALIDITY;   ENFORCEMENT. This Agreement has been, and, when
the other   Transaction   Documents   (as   defined   below) to which such Buyer is a
party are executed and   delivered in   accordance   with the terms and   conditions
contemplated hereby and thereby, such documents shall have been duly and validly
authorized,   executed and delivered on behalf of such Buyer and shall constitute
the legal, valid and binding   obligations of such Buyer enforceable against such
Buyer in accordance with their respective terms,   except as such   enforceability
may be limited   by general   principles   of equity or to   applicable   bankruptcy,
insolvency,   reorganization,   fraudulent   conveyance   or   transfer,   moratorium,
liquidation   and other   similar laws   relating to, or affecting   generally,   the
enforcement of applicable creditors' rights and remedies.

                  (i) NO CONFLICTS.   The execution,   delivery and performance by
such Buyer of this Agreement and the other   Transaction   Documents to which such
Buyer   is a   party   and   the   consummation   by such   Buyer   of the   transactions
contemplated   hereby   and   thereby   will not (i)   result in a   violation   of any
organizational   documents of such Buyer or (ii)   conflict   with, or constitute a
default (or an event   which with notice or lapse of time or both would   become a
default)   under,   or   give to   others   any   rights   of   termination,   amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which
such   Buyer is a   party,   or   (iii)   result   in a   violation   of any law,   rule,
regulation,   order,   judgment or decree (including   federal and state securities
laws) applicable to such Buyer or by which any property or asset of the Buyer is
bound or affected,   except in the case of clauses (ii) and (iii) above, for such
conflicts,   defaults,   rights or violations which would not,   individually or in
the aggregate,   reasonably be expected to have a material   adverse effect on the
ability of such Buyer to perform its   obligations   hereunder or under any of the
other Transaction Documents. Each Buyer agrees that it has independently,   based
on such documents and   information it deemed   appropriate,   made its decision to
enter into this Agreement and purchase the Notes and Warrants.

                  (j) RESIDENCY.   Such Buyer is a resident of that   jurisdiction
specified below its address on the Schedule of Buyers.

                  (k)   PLACEMENT   AGENT.   Such Buyer   understands   that Rodman &
Renshaw,   LLC (the "AGENT") has acted solely as the agent of the Company in this
placement   of the   Securities,   and that the Agent   makes no   representation   or
warranty with regard to the merits of this   transaction or as to the accuracy of
any information such Buyer may have received in connection therewith. Such Buyer
acknowledges that it has not relied on any information   prepared by the Agent or
advice   furnished   by or on behalf of the Agent.   Such Buyer agrees that it has,
independently   and without   reliance on Agent,   and based on such   documents and
information   as it has   deemed   appropriate,   made its own   credit   analysis   of
ShellCo, the Company and the Targets and has made its own decision to enter into
this Agreement and purchase the applicable Securities.

                                       8
<PAGE>

         3.    REPRESENTATIONS   AND   WARRANTIES   OF   THE   COMPANY.    The   Company
represents   and   warrants   to each of the   Buyers on the date   hereof and on the
Closing Date that:

                  (a) ORGANIZATION AND QUALIFICATION. Set forth on SCHEDULE 3(A)
is a true and correct   list of the   entities in which the Company or any Target,
directly   or   indirectly,   owns   capital   stock or holds an   equity   or   similar
interest,   together with their respective   jurisdictions of organization and the
percentage of the   outstanding   capital stock or other equity   interests of such
entity   that is held by the   Company or such   Target or any of their   respective
Subsidiaries.   SCHEDULE   3(A)   also   sets   forth a true   and   correct   corporate
structure of ShellCo and its   Subsidiaries   immediately   following   the Closing,
giving pro forma   effect to the   Acquisitions.   Other   than with   respect to the
entities listed on SCHEDULE 3(A), neither the Company or any Target, directly or
indirectly,   owns any securities or beneficial   ownership interests in any other
Person (including through joint ventures or partnership arrangements) or has any
investment in any other Person.   The Company and its   "SUBSIDIARIES"   (which for
purposes   of this   Agreement   means any entity in which the   Company or ShellCo,
directly   or   indirectly,   owns any of the   capital   stock,   equity   or   similar
interests   or voting   power of such entity at the date of this   Agreement or any
time hereafter, and each of the Targets and their respective subsidiaries) other
than the Foreign   Subsidiaries   are entities duly organized and validly existing
and in good   standing   under   the laws of the   jurisdiction   in   which   they are
formed,   and have the requisite power and authority to own their   properties and
to carry on their   business   as now being   conducted.   To the   knowledge   of the
Company,   each of the Foreign   Subsidiaries   are   entities   duly   organized   and
validly existing and, to the extent legally   applicable,   in good standing under
the laws of the   jurisdiction   in which they are formed,   and have the requisite
power and authority to own their   properties   and to carry on their   business as
now being conducted, except where failure to be so organized,   existing, in good
standing, and/or have such requisite power and authority would not, individually
or in the aggregate, have a Material Adverse Effect. Each of the Company and the
Subsidiaries   is duly   qualified as a foreign   entity to do business and, to the
extent legally   applicable,   is in good standing in every   jurisdiction in which
its   ownership of property or the nature of the   business   conducted by it makes
such   qualification   necessary,   except to the extent   that the failure to be so
qualified or be in good standing would not have a Material   Adverse   Effect.   As
used in this Agreement,   "MATERIAL   ADVERSE   EFFECT" means any material   adverse
effect on the business, properties, assets, operations, results of operations or
condition (financial or otherwise) of the Company and its Subsidiaries, taken as
a whole, or on the transactions   contemplated   hereby and the other   Transaction
Documents or by the agreements and   instruments to be entered into in connection
herewith   or   therewith,   or on the   authority   or ability of the Company or any
Subsidiary   to perform   its   obligations   under the   Transaction   Documents   (as
defined   below).   Except as set forth in   SCHEDULE   3(A),   the   Company and each
Target holds all right,   title and interest in and to 100% of the capital stock,
equity or similar   interests   of each of its   respective   Subsidiaries,   in each
case,   free and clear of any Liens (as defined below) other than Permitted Liens
(as   defined   in the   Notes)   including   any   restriction   on the   use,   voting,
transfer,   receipt of income or other   exercise   of any   attributes   of free and
clear ownership by a current holder other than as set forth in the Intercreditor
Agreement,   and no such   Subsidiary   owns   capital   stock or holds an   equity or
similar interest in any other Person.   As used in this Agreement,   "LIEN" means,
with respect of any asset, any mortgage,   lien, pledge,   hypothecation,   charge,
security interest,   encumbrance or adverse claim of any kind and any restrictive
covenant, condition, restriction or exception of any kind that has the practical
effect of creating a mortgage,   lien,

                                        9
<PAGE>

pledge, hypothecation,   charge, security interest,   encumbrance or adverse claim
of any   kind   (including   any of the   foregoing   created   by,   arising   under or
evidenced   by any   conditional   sale or other   title   retention   agreement,   the
interest   of a lessor   with   respect to a "Capital   Lease" (in   accordance   with
generally   accepted   accounting   principles),   or   any   financing   lease   having
substantially the same economic effect as any of the foregoing).

                  (b) AUTHORIZATION;   ENFORCEMENT; VALIDITY. The Company has the
requisite    corporate   power   and   authority   to   enter   into   and   perform   its
obligations   under   (i) this   Agreement,   the   Guaranty   and   each of the   other
agreements    entered   into   by   the   parties   hereto   in   connection    with   the
transactions   contemplated   by this   Agreement   to   which   it is a   party   (such
documents,   and together with the Notes, the Warrants,   the Registration   Rights
Agreement,   the   Security   Documents,   the   Transfer   Agent   Instructions,    the
Intercreditor   Agreement and each of the other   agreements to be entered into in
connection with the   transactions   contemplated   by this Agreement,   as amended,
restated,   supplemented and/or modified from time to time in accordance with the
provisions   thereof,   collectively,   the   "TRANSACTION   DOCUMENTS") and (ii) the
Acquisition   Documents   (as   defined in Section   3(ii))   and to   consummate   the
transactions contemplated herein and therein in accordance with the terms hereof
and thereof.   The   execution and delivery of the   Transaction   Documents and the
Acquisition   Documents   (to which the Company is a party) by the Company and the
consummation by the Company of the transactions contemplated hereby and thereby,
have been duly   authorized   by the board of directors of the Company (the "BOARD
OF   DIRECTORS")   and other than as set forth in Section 3(e) hereof,   no further
filing, consent or authorization is required by the Company, its stockholders or
the Board of Directors.   To the extent that a person that is a Subsidiary of the
Company on the date hereof is a party to or bound by a   Transaction   Document or
an Acquisition   Document,   such Subsidiary has the requisite power and authority
to enter into and perform its   obligations   under such   Transaction   Document or
Acquisition Document and the execution and delivery of such Transaction Document
by such Subsidiary and the   consummation by such Subsidiary of the   transactions
contemplated   thereby   have been duly   authorized   by the board of   directors or
equivalent body of such Subsidiary and no further   consent or   authorization   is
required by such   Subsidiary,   its equity   holders or its board of   directors or
equivalent   body.   This   Agreement,   the   other   Transaction   Documents   and the
Acquisition Documents to which the Company and, if applicable,   its Subsidiaries
(existing on the date hereof) is a party have been duly   executed and   delivered
by the Company,   and constitute the legal, valid and binding obligations of such
parties   enforceable   against such parties in accordance   with their   respective
terms,   except as such   enforceability   may be limited by general   principles of
equity   or   applicable   bankruptcy,    insolvency,    reorganization,    fraudulent
conveyance or transfer, moratorium,   liquidation or similar laws relating to, or
affecting   generally,   the   enforcement   of   applicable   creditors'   rights   and
remedies.   As of the Closing,   the   Transaction   Documents   and the   Acquisition
Documents   dated after the date of this Agreement and on or prior to the date of
the Closing   shall have been duly   executed and delivered by the Company and, if
applicable,   those   Persons   who are   Subsidiaries   of the   Company   on the date
hereof, and shall constitute the valid and binding   obligations of such parties,
enforceable   against   such   parties in   accordance   with their   terms   except as
enforceability   may be   limited by general   principles   of equity or   applicable
bankruptcy,   insolvency,   reorganization,   fraudulent   conveyance   or   transfer,
moratorium or similar laws relating to, or affecting generally,   the enforcement
of creditors' rights and remedies.

                                       10
<PAGE>

                  (c) OFFER OF   SECURITIES.   Subject to the   accuracy of Buyer's
representations and warranties   hereunder,   the offer by the Company and ShellCo
of the Securities is exempt from registration under the 1933 Act.

                  (d) NO CONFLICTS.   The execution,   delivery and performance of
the Transaction   Documents by the Company,   and if applicable its   Subsidiaries,
and the consummation by such parties of the transactions contemplated hereby and
thereby and the granting of a security   interest in the Collateral   will not (i)
result in a   violation   of any   certificate   of   incorporation,   certificate   of
formation, any certificate of designations or other constituent documents of the
Company or any of the   Subsidiaries,   any capital stock of the Company or any of
the   Subsidiaries   or bylaws of the Company or any of the   Subsidiaries   or (ii)
conflict   with,   or constitute a default (or an event which with notice or lapse
of time or both would become a default) in any respect under,   or give to others
any rights of termination,   amendment, acceleration or cancellation of, or other
remedy in respect   of,   any   agreement,   indenture   or   instrument   to which the
Company or any of the Subsidiaries is a party, or (iii) result in a violation of
any   Requirements   of Law,   except in the case of clauses (i) (in respect of the
Foreign Subsidiaries),   (ii) and (iii) of this Section 3(d), for such conflicts,
defaults,   rights   or   violations   which   would   not,   individually   or   in   the
aggregate,   have a   Material   Adverse   Effect.   As used in this   Agreement,   (A)
"REQUIREMENTS OF LAW" means, as to any Person, any United States or foreign law,
statute, treaty, rule, regulation, right, privilege,   qualification,   license or
franchise or   determination   of an arbitrator   or a court or other   Governmental
Entity,   in each case   applicable   or   binding   upon   such   Person or any of its
property or to which such Person or any of its property is subject or pertaining
to any or all of the   transactions   contemplated   or   referred to herein and (B)
"GOVERNMENTAL   ENTITY" means the government of any nation, state, city, locality
or   other   political   subdivision   thereof,   any   entity   exercising   executive,
legislative,   judicial,   regulatory or administrative functions of or pertaining
to government and any   corporation or other entity owned or controlled,   through
stock or capital ownership or otherwise, by any of the foregoing.

                  (e) CONSENTS.   Neither the Company nor any of the Subsidiaries
is required to obtain any consent, authorization or order of, or make any filing
or   registration   with,   any court,   governmental   agency or any   regulatory   or
self-regulatory   agency or any other Person in order for it to execute,   deliver
or perform   any of its   obligations   under or   contemplated   by the   Transaction
Documents   to which it is a party,   in each   case in   accordance   with the terms
hereof or thereof,   except for the following consents,   authorizations,   orders,
filings   and   registrations:    (i)   the   filing   of   appropriate   UCC   financing
statements with the   appropriate   states and other   authorities   pursuant to the
Pledge Agreement and the Security   Agreement;   (ii) the Perfection   Requirements
(as defined in the   Security   Agreement);   (iii) the current   report on Form 8-K
required to be filed after   Closing by ShellCo   pursuant to Section 4(h) of this
Agreement;   (iv) the filing of the Schedule   14C   relating to the Reverse   Split
among other   things;   (v) the Form D filing   required to be made   following   the
Closing by ShellCo   with the SEC;   (vi)   filings   required by   applicable   state
securities   laws;   and   (vii)   the   registration   statement   and   related   state
securities   law   filings   required by the   Registration   Rights   Agreement.   All
consents, authorizations, orders, filings and registrations which the Company is
required to have   obtained   prior to the date hereof   pursuant to the   preceding
sentence have been obtained or effected. Notwithstanding the first two sentences
of this Section 3(e),   to the extent that any Foreign   Subsidiary is required to
obtain any consent,   authorization or order, or make any filing or registration,
but has not done so, such failure   shall

                                       11
<PAGE>

not constitute a default hereunder or under the other   Transaction   Documents if
such   failure(s),   individually   or in the aggregate,   would not have a Material
Adverse Effect.

                  (f)   ACKNOWLEDGMENT   REGARDING BUYER'S PURCHASE OF SECURITIES.
The   Company   acknowledges   and agrees   that each Buyer is acting   solely in the
capacity of an arm's length   purchaser in respect of the   Transaction   Documents
and the   transactions   contemplated   hereby and thereby and that,   except as set
forth on SCHEDULE   3(F),   no Buyer is (i) an officer or director of the Company,
(ii) an   "affiliate"   of the   Company   (as   defined in Rule 144) or (iii) to the
knowledge of the Company, a "beneficial owner" of more than 10% of the shares of
Common Stock (as defined for purposes of Rule 13d-3 of the   Securities   Exchange
Act of 1934,   as amended (the "1934   Act")).   The Company   further   acknowledges
that, except as set forth on SCHEDULE 3(F), to the knowledge of the Company,   no
Buyer is acting as a   financial   advisor or   fiduciary   of any of   ShellCo,   the
Company   or any   Subsidiary   (or in any   similar   capacity)   in   respect   of the
Transaction Documents and the transactions   contemplated hereby and thereby, and
any   advice   given   by a   Buyer   or any   of its   representatives   or   agents   in
connection   with the   Transaction   Documents and the   transactions   contemplated
hereby   and   thereby   is   merely   incidental   to such   Buyer's   purchase   of the
Securities.   The Company   further   represents to each Buyer that the decision of
the Company and each of the Subsidiaries to enter into the Transaction Documents
to which   such   Person   is a party   has been   based   solely   on the   independent
evaluation    by   the    Company,    such    Subsidiaries    and    their    respective
representatives.

                  (g) NO GENERAL   SOLICITATION;   PLACEMENT AGENT'S FEES. None of
the Company,   any of its   Affiliates,   or to the   knowledge of the Company,   any
Person   acting   on its or their   behalf,   has   engaged   in any   form of   general
solicitation   or general   advertising   (within the meaning of   Regulation   D) in
connection   with   the   offer or sale of the   Securities.   The   Company   shall be
responsible for the payment of any placement   agent's fees,   financial   advisory
fees, or brokers'   commissions   (other than for persons   engaged by any Buyer or
its   investment   advisor)   relating   to   or   arising   out   of   the   transactions
contemplated   hereby.   The   Company   shall   pay,   and hold each   Buyer   harmless
against,   any   liability,   loss   or   expense   (including,    without   limitation,
attorneys' fees and out-of-pocket   expenses) arising in connection with any such
claim. The Company acknowledges that it has engaged the Agent as placement agent
in connection   with the sale of the Securities.   Other than the Agent,   the fees
and expenses of whom shall be borne by the Company or ShellCo   (pursuant to that
certain Placement Agent Agreement between Agent and the Company dated August 22,
2006),   the   Company   has not   engaged   any   placement   agent or other   agent in
connection with the sale of the Securities.

                  (h)   NO   INTEGRATED    OFFERING.    None   of   the   Company,   the
Subsidiaries, any of their Affiliates, nor, to the knowledge of the Company, any
Person acting on their behalf has made,   directly or   indirectly,   any offers or
sales of any   security   or   solicited   any   offers   to buy any   security,   under
circumstances that would require registration of any of the Securities under the
1933 Act or cause this offering of the Securities to be integrated with prior or
concurrent   offerings   by   the   Company   for   purposes   of the   1933   Act or any
applicable stockholder approval provisions, including, without limitation, under
the rules and regulations of any exchange or automated quotation system on which
any of the   securities   of the Company are listed or   designated   other than the
Common PIPE   Offering and the   Acquisitions,   which Common PIPE Offering and the
Acquisitions   have been   undertaken   only in such a manner   as to not   adversely
affect the exemption   from   registration   enjoyed by the sale of the   Securities
pursuant   to   this

                                       12
<PAGE>

Agreement. None of the Company, the Subsidiaries, their Affiliates or any Person
acting   on their   behalf   will   take any   action   or   steps   referred   to in the
preceding   sentence that would   require   registration   of any of the   Securities
under the 1933 Act or cause the offering of the Securities to be integrated with
other offerings. As used in this Agreement,   "AFFILIATE" means any Person who is
an   "AFFILIATE"   as defined in Rule 12b-2 of the General   Rules and   Regulations
under the 1934 Act.

                  (i) APPLICATION OF TAKEOVER PROTECTIONS; RIGHTS AGREEMENT. The
Company and the Board of Directors have taken all necessary   action,   if any, in
order   to   render    inapplicable    any   control   share    acquisition,    business
combination,   poison pill (including any distribution   under a rights agreement)
or other similar anti-takeover   provision under the Certificate of Incorporation
(as defined in Section   3(o)) or the laws of Delaware   which is or could   become
applicable   to any Buyer as a result of the   transactions   contemplated   by this
Agreement,   including, without limitation,   ShellCo's issuance of the Securities
and any   Buyer's   ownership   of the   Securities.   The   Company has not adopted a
stockholder   rights plan or similar   arrangement   relating to   accumulations   of
beneficial ownership of its Common Stock or a change in control of the Company.

                  (j)    FINANCIAL    STATEMENTS.    The    consolidated    financial
statements   of the   Company   and   each of the   Targets   have   been   prepared   in
accordance with United States generally accepted accounting   principles ("GAAP")
consistently   applied,   during   the   periods   involved   (except   (i)   as   may be
otherwise   indicated in such financial   statements or the notes thereto, or (ii)
in the case of   unaudited   interim   statements,   to the extent   they may exclude
footnotes or may be condensed or summary   statements)   and fairly present in all
material   respects the   financial   position of the Company,   or such Target,   as
applicable,   as of the dates thereof and the results of its   operations and cash
flows for the periods then ended (subject,   in the case of unaudited statements,
to normal year-end audit adjustments that, to the Company's   knowledge,   are not
material,    individually   or   in   the   aggregate.   Except   for   liabilities   and
obligations incurred in the ordinary course of business and consistent with past
practice,   liabilities and obligations   reflected on or reserved   against in the
June 30, 2006 interim   consolidated balance sheets of the Company or in the June
30, 2006   interim   consolidated   balance   sheets of any Target,   as   applicable,
prepared   in   accordance   with GAAP   delivered   pursuant   to   Section   7(q) (the
"BALANCE SHEETS") and as otherwise contemplated hereby or disclosed herein or in
the disclosure schedules to this Agreement (the "DISCLOSURE   SCHEDULES"),   since
July 1,   2006,   inclusive   of such date,   none of the   Company or any Target has
incurred any   liabilities or obligations   that would be required to be reflected
or   reserved   against   in a balance   sheet of the   Company   or such   Target,   as
applicable,   prepared in accordance   with the principles used in the preparation
of the Balance Sheets. None of the Company or, to the Company's   knowledge,   any
stockholder,   officer or director of the Company has issued any press release or
made any other   public   statement or   communication   on behalf of the Company or
otherwise   relating to the Company or any of its Subsidiaries   that contains any
untrue   statement of a material   fact or omits any   statement   of material   fact
necessary   in   order   to   make   the   statements   therein,   in the   light   of the
circumstances under which they were made, not misleading.

                  (k) ABSENCE OF CERTAIN CHANGES. Since June 30, 2006, there has
been no change or development in the business, properties, operations, condition
(financial   or   otherwise)   results of operations or prospects of the Company or
any Subsidiary   that has had or could

                                       13
<PAGE>

reasonably be expected to have a Material Adverse Effect. Except as set forth on
SCHEDULE   3(K),    since   June   30,   2006,   (and   before   giving   effect   to   the
transactions   contemplated under the Transaction   Documents) none of the Company
or any Target has (i)   declared or paid any   dividends   other than as would have
been permitted   under the Notes,   (ii) sold any assets,   individually   or in the
aggregate,   in excess of $300,000   outside of the   ordinary   course of business,
(iii) had capital expenditures,   individually or in the aggregate,   in excess of
$300,000 or (iv) waived any material   rights in respect of any   Indebtedness   or
other rights in excess of $300,000 owed to it. None of the Company or any Target
has taken any steps to seek   protection   pursuant to any bankruptcy law nor does
the Company have any   knowledge   or reason to believe that its   creditors or the
creditors of any Target intend to initiate involuntary bankruptcy proceedings or
any actual   knowledge of any fact which would   reasonably   lead a creditor to do
so.   Neither   the Company   nor any   Subsidiary   of the Company is as of the date
hereof, and after giving effect to the transactions contemplated hereby to occur
at the Closing   will be,   Insolvent   (as defined   below).   For   purposes of this
Section 3(k),   "INSOLVENT" means, in respect of any Person, (i) the present fair
saleable value of such Person's assets (and including as assets for this purpose
at a fair valuation all rights of subrogation,   contribution or   indemnification
arising pursuant to any guarantees given by such Person) is less than the amount
required to pay such Person's   (after giving effect to the   Acquisitions)   total
Indebtedness (as defined in Section 3(p)), (ii) such Person is unable to pay its
debts and liabilities,   subordinated, contingent or otherwise, as such debts and
liabilities   become absolute and matured,   (iii) such Person intends at any time
to incur or   believes   that it will at any time incur debts that would be beyond
its   ability to pay as such debts   mature or (iv) such   Person has   unreasonably
small   capital with which to conduct the business in which it is engaged as such
business is now conducted and is proposed to be conducted.

                  (l)   CONDUCT   OF   BUSINESS;   REGULATORY   PERMITS.   None of the
Company or any Subsidiary is in violation of any term of or in default under its
certificate   of   incorporation,   certificate   of formation,   any   certificate of
designations   of any   outstanding   series of preferred   stock of such company or
Bylaws or their organizational charter or other constituent documents or bylaws,
respectively   except   for such   violations   or   defaults   in the case of Foreign
Subsidiaries   which would not,   individually or in the aggregate,   reasonably be
expected   to   have   a   Material   Adverse   Effect.   None   of the   Company   or any
Subsidiary   is in   violation   of any   judgment,   decree or order or any statute,
ordinance, rule or regulation applicable to such entity, and none of the Company
or any Subsidiary   will conduct its   respective   business in violation of any of
the foregoing, except for such violations and/or possible violations which would
not, individually or in the aggregate, reasonably be expected to have a Material
Adverse   Effect.   The Company   and each   Subsidiary   possess   all   certificates,
authorizations   and permits   issued by the   appropriate   regulatory   authorities
necessary to conduct their   respective   businesses,   except where the failure to
possess   such    certificates,    authorizations    or   permits    would   not   have,
individually or in the aggregate,   a Material   Adverse   Effect,   and none of the
Company or any Subsidiary has received any notice of proceedings relating to the
revocation or   modification   of any such   certificate,   authorization   or permit
except   where such   proceedings,   revocation   or   modification   would not have a
Material Adverse Effect.

                  (m)   FOREIGN   CORRUPT   PRACTICES.   None of the   Company or any
Subsidiary, nor any director, officer, agent, employee or other Person acting on
behalf of any of them has,   in the course of its   actions   for, or on behalf of,
such entity (i) used any corporate   funds for any

                                       14
<PAGE>

unlawful contribution,   gift,   entertainment or other unlawful expenses relating
to political activity;   (ii) made any direct or indirect unlawful payment to any
foreign or domestic   government official or employee from corporate funds; (iii)
violated   or is in   violation   of any   provision   of the   U.S.   Foreign   Corrupt
Practices   Act of 1977,   as amended;   or (iv) made any unlawful   bribe,   rebate,
payoff, influence payment,   kickback or other unlawful payment to any foreign or
domestic government official or employee; except for such actions referred to in
clauses (i) through   (iv) which,   individually   or in the   aggregate,   could not
reasonably be expected to have a Material Adverse Effect.

                  (n)   TRANSACTIONS   WITH   AFFILIATES.   Except   as set   forth in
SCHEDULE 3(N) hereto,   other than the issuance of restricted stock and the other
arrangements   disclosed on SCHEDULE   3(N),   none of the   officers,   directors or
employees   of any of the Company or any   Subsidiary   is presently a party to any
transaction   with any of the Company or any Subsidiary   (other than for ordinary
course   services as employees,   officers or directors),   including any contract,
agreement or other   arrangement   providing for the   furnishing of services to or
by,   providing for rental of real or personal   property to or from, or otherwise
requiring payments to or from any such officer,   director or employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in
which any such officer,   director,   or employee has a substantial interest or is
an officer, director, trustee or partner.

                  (o) EQUITY   CAPITALIZATION.   As of the date   hereof and before
giving effect to the Merger, the Acquisitions,   and the financings   contemplated
in the   Transaction   Documents,   the   authorized   capital   stock of the   Company
consists of one million   shares of Common   Stock,   all of which,   as of the date
hereof,   are issued and outstanding.   All of such   outstanding   shares of Common
Stock   of   the   Company   have   been   validly   issued   and   are   fully   paid   and
nonassessable.   Except as disclosed in SCHEDULE   3(O): (i) none of the Company's
capital stock is subject to preemptive rights or any other similar rights or any
Liens   suffered   or   permitted   by the   Company;   (ii) there are no   outstanding
options,   warrants,   scrip,   rights to subscribe to, calls or commitments of any
character   whatsoever   relating to, or securities or rights convertible into, or
exercisable or exchangeable   for, any capital stock of the Company or any of its
Subsidiaries, or contracts, commitments, understandings or arrangements by which
the   Company   or   any of   its   Subsidiaries   is or may   become   bound   to   issue
additional   capital stock of the Company or any of its   Subsidiaries or options,
warrants,   scrip,   rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into, or exercisable
or   exchangeable    for,   any   capital   stock   of   the   Company   or   any   of   its
Subsidiaries;   (iii) there are no outstanding   debt   securities,   notes,   credit
agreements,   credit   facilities or other   agreements,   documents or   instruments
evidencing   Indebtedness   of the Company or any of its   Subsidiaries or by which
the Company or any of its   Subsidiaries   is or may become   bound except for such
Indebtedness   which   (x)   will   be   paid   or   satisfied   in   full   substantially
concurrently   with the Closing with the   proceeds of the purchase of   securities
hereunder,   of the Common PIPE Offering,   and under the Senior Loan Agreement or
(y) constitutes Permitted Indebtedness (as defined in the Notes); (iv) there are
no financing   statements   securing   obligations in any material amounts,   either
singly or in the aggregate,   filed in connection   with the Company or any of its
Subsidiaries   other than financing   statements   evidencing   Permitted Liens; (v)
there are no   agreements or   arrangements   under which the Company or any of its
Subsidiaries is obligated to register the sale of any of their   securities under
the 1933 Act   (except   pursuant to the   Registration   Rights   Agreement   and the
Common PIPE   Registration   Rights Agreement and registration   rights

                                       15
<PAGE>

the Company has agreed to provide to the Agent, the existing shareholders listed
on   Schedule   2(b) to the   Registration   Rights   Agreement,   certain   members of
management and the current   holders of ShellCo Common Stock);   (vi) there are no
outstanding   securities or instruments of the Company or any of its Subsidiaries
which contain any redemption or similar provisions,   and there are no contracts,
commitments,   understandings   or arrangements by which the Company or any of its
Subsidiaries   is or may become   bound to redeem a security of the Company or any
of such   Subsidiaries;   (vii) there are no securities or instruments   containing
anti-dilution   or similar   provisions   that will be triggered by the issuance of
the Securities;   (viii) the Company does not have any stock appreciation   rights
or "phantom   stock" plans or agreements   or any similar plan or agreement;   (ix)
all the   Company's   outstanding   options   and   warrants   shall be   cancelled   at
Closing;   and (x) no securities of the Company or any   Subsidiary   are listed or
quoted on any stock exchange or automated quotation system. All of the Company's
outstanding options and warrants shall be canceled at Closing. Immediately after
giving   effect to the Merger,   (i) all of the Company's   issued and   outstanding
stock   shall be owned by   ShellCo   and (ii) all other   securities   issued by the
Company   (including,   without limitation,   any securities   disclosed in SCHEDULE
3(O))   shall have been   exchanged   for shares of   ShellCo's   Common   Stock.   The
Company has made   available to the Buyers true,   correct and complete   copies of
the Company's   Certificate of Incorporation,   as amended and as in effect on the
date hereof (the "CERTIFICATE OF   INCORPORATION"),   and the Company's Bylaws, as
amended and as in effect on the date hereof (the   "BYLAWS"),   and all agreements
relating to securities   convertible   into, or exercisable or   exchangeable   for,
shares of Common Stock and the material rights of the holders thereof in respect
thereof.

                  (p) INDEBTEDNESS   AND OTHER CONTRACTS.   Except as disclosed in
SCHEDULE 3(P),   none of the Company or any   Subsidiary   (i) has any   outstanding
Indebtedness   (as defined   below)   except for   Permitted   Indebtedness   and such
Indebtedness which will be paid or satisfied in full substantially   concurrently
with Closing with the proceeds of the purchase of securities   hereunder,   of the
Common PIPE Offering,   and under the Senior Loan   Agreement,   (ii) is a party to
any contract,   agreement or instrument, the violation of which, or default under
which, by the other   party(ies) to such contract,   agreement or instrument could
reasonably   be   expected   to result in a Material   Adverse   Effect,   (iii) is in
violation   of any   term   of or in   default   under   any   contract,   agreement   or
instrument   relating   to any   Indebtedness,   except   where such   violations   and
defaults   would not   result,   individually   or in the   aggregate,   in a Material
Adverse   Effect,   or (iv) is a party to any   contract,   agreement or   instrument
relating to any   Indebtedness,   the performance of which, in the judgment of the
Company's   officers,   could be   reasonably   expected to have a Material   Adverse
Effect.   Immediately   after giving   effect to the Merger,   none of ShellCo,   the
Company,   any Target,   or Subsidiary   shall have any   outstanding   Indebtedness,
other than the Notes,   the   Permitted   Senior   Indebtedness   (as   defined in the
Notes) and the Permitted Indebtedness (as defined in the Notes). For purposes of
this Agreement:   (x) "INDEBTEDNESS" of any Person means, without duplication (A)
all indebtedness for borrowed money, (B) all obligations   issued,   undertaken or
assumed as the   deferred   purchase   price of   property   or   services,   including
(without   limitation)   "capital   leases" in accordance   with generally   accepted
accounting   principles   (other than trade payables   entered into in the ordinary
course of business),   (C) all reimbursement or payment obligations in respect of
letters   of   credit,   surety   bonds   and   other   similar   instruments,   (D)   all
obligations   evidenced   by notes,   bonds,   debentures   or   similar   instruments,
including   obligations so evidenced   incurred in connection with the acquisition
of property, assets or businesses, (E) all indebtedness created or arising under
any   conditional   sale or   other   title

                                        16
<PAGE>

retention agreement,   or incurred as financing, in either case in respect of any
property or assets acquired with the proceeds of such indebtedness   (even though
the rights and remedies of the seller or bank under such   agreement in the event
of   default   are   limited to   repossession   or sale of such   property),   (F) all
monetary   obligations   under   any   leasing   or   similar   arrangement   which,   in
connection with generally accepted accounting   principles,   consistently applied
for the periods   covered   thereby,   is   classified as a capital   lease,   (G) all
indebtedness   referred to in clauses   (A)   through (F) above   secured by (or for
which the holder of such   Indebtedness   has an   existing   right,   contingent   or
otherwise,   to be secured   by) any   mortgage,   lien,   pledge,   charge,   security
interest   or other   encumbrance   upon or in any   property   or assets   (including
accounts and contract rights) owned by any Person,   even though the Person which
owns such assets or property has not assumed or become liable for the payment of
such indebtedness, and (H) all Contingent Obligations in respect of indebtedness
or   obligations   of others of the kinds   referred   to in clauses (A) through (G)
above;   (y)   "CONTINGENT   OBLIGATION"   means,   as to any   Person,   any direct or
indirect   liability,   contingent or otherwise,   of that Person in respect of any
indebtedness,   lease,   dividend   or other   obligation   of another   Person if the
primary purpose or intent of the Person incurring such liability, or the primary
effect   thereof,   is to provide   assurance to the obligee of such liability that
such   liability   will be paid or   discharged,   or that any   agreements   relating
thereto will be complied   with,   or that the holders of such   liability   will be
protected   (in   whole or in   part)   against   loss in   respect   thereof;   and (z)
"PERSON" means an individual,   a limited   liability   company,   a partnership,   a
joint venture,   a corporation,   a trust,   an   unincorporated   organization   or a
government or any department or agency thereof.

                  (q)   ABSENCE   OF   LITIGATION.    There   is   no   action,    suit,
proceeding, inquiry or investigation that if adversely determined,   individually
or in the   aggregate,   would have a Material   Adverse   Effect   before or by, any
court,   public board,   government agency,   self-regulatory   organization or body
pending or, to the knowledge of the Company, threatened against or affecting the
Company, any Subsidiary,   any of their respective officers or directors,   or the
Common Stock.

                  (r) INSURANCE.   The Company and each   Subsidiary is insured by
insurers of recognized   financial   responsibility   against such losses and risks
and in such   amounts as   management   of the   Company   believes to be prudent and
customary in the   businesses   in which such   entities   are engaged.   None of the
Company or any   Subsidiary has any reason to believe that it will not be able to
renew its existing   insurance   coverage as and when such coverage   expires or to
obtain   similar   coverage from similar   insurers as may be necessary to continue
its business at a cost that would not have a Material Adverse Effect.

                  (s) EMPLOYEE RELATIONS.

                         (i) None of the Company or any Subsidiary is a party to
any   collective   bargaining   agreement   or employs   any   member of a union.   The
Company and its   Subsidiaries   believe   that the   Company's   relations   with its
employees   and   the   relations   of   its    Subsidiaries    with   their   respective
Subsidiaries are good. No executive officer (as defined in Rule 3b-7 promulgated
under the 1934 Act) of the Company or any Subsidiary has notified the Company or
such Subsidiary that such officer intends to leave the Company or Subsidiary, as
applicable, or otherwise intends to terminate such officer's employment with the
Company or Subsidiary.   To the knowledge of the Company, no executive officer of
the Company or any   Subsidiary is, or is now expected to be, in violation of any
material   term   of   any   employment   contract,

                                       17
<PAGE>

confidentiality,     disclosure     or     proprietary     information     agreement,
non-competition agreement, or any other contract or agreement or any restrictive
covenant and the continued   employment of each such   executive   officer does not
subject the Company or any   Subsidiary to any liability in respect of any of the
foregoing   matters   except such   violations   and/or   liabilities   that would not
individually   or in the   aggregate   be   reasonably   expected   to have a Material
Adverse Effect.

                         (ii) The Company and the Subsidiaries are in compliance
with all   federal,   state,   local and foreign   laws and   regulations   respecting
labor, employment and employment practices and benefits, terms and conditions of
employment   and   wages and   hours,   except   where   failure   to be in   compliance
therewith   would not   result,   either   individually   or in the   aggregate,   in a
Material Adverse Effect.

                  (t) TITLE.   The Company and the   Subsidiaries   (other than the
Foreign   Subsidiaries)   have good and marketable title in fee simple to all real
property and good and valid title to all personal   property   owned by them which
is material to the business of the Company or Subsidiary, as applicable, in each
case free and clear of all Liens except for   Permitted   Liens (as defined in the
Notes).   To the knowledge of the Company,   (i) none of the Foreign   Subsidiaries
owns fee simple   interest in any real property (or the equivalent   thereof under
applicable   law) and (ii) each of the   Foreign   Subsidiaries   has good and valid
title to all personal   property   owned by them which is material to the business
of   such   Subsidiary,   except   where   failure   to have   good   and   valid   title,
individually   or in the   aggregate,   would not be reasonably   expected to have a
Material Adverse Effect, free and clear of all Liens other than Permitted Liens.
Except as set forth on SCHEDULE   3(T),   any real   property and   facilities   held
under lease by the Company or any of the Subsidiaries are held by the applicable
entity under valid,   subsisting and   enforceable   leases with such exceptions as
are not material and do not interfere   with the use made and proposed to be made
of such   property   and   buildings   by the Company and such   Subsidiaries.   Where
failures to have such valid,   subsisting and enforceable   lease(s)   exist,   such
failures, in the aggregate, would not have a Material Adverse Effect.

                  (u)   INTELLECTUAL    PROPERTY   RIGHTS.    The   Company   and   the
Subsidiaries   (other   than   Foreign   Subsidiaries)   own or possess   and,   to the
knowledge   of the Company,   the Foreign   Subsidiaries   own or possess,   adequate
rights or licenses to use all   trademarks,   trade names,   service   marks and all
applications and registrations   therefor,   patents,   patent rights,   copyrights,
original   works of authorship,   inventions,   licenses,   approvals,   governmental
authorizations,     trade    secrets   and   other    intellectual    property    rights
("INTELLECTUAL    PROPERTY    RIGHTS")    necessary   to   conduct   their   respective
businesses as now conducted.   Except as set forth on SCHEDULE 3(U),   none of the
Company's or the Subsidiaries' registered, or applied for, Intellectual Property
Rights have expired or   terminated   or have been   abandoned,   or are expected to
expire or   terminate   or expected to be   abandoned,   within three years from the
date of this Agreement.   The   terminations,   expirations or abandonments of such
registered,   or applied   for,   Intellectual   Property   Rights   would not, in the
aggregate,   have a   Material   Adverse   Effect.   The   Company   does   not have any
knowledge   of any   infringement   by the   Company or any of the   Subsidiaries   of
Intellectual   Property Rights of others except of such   infringement   that would
not have a Material Adverse Effect.   Except as set forth on SCHEDULE 3(U), there
is no claim,   action or proceeding being made or brought, or to the knowledge of
the Company,   being threatened,   against the Company or any Subsidiary regarding
their respective   Intellectual Property Rights and any such claims,   actions and
proceedings being made, brought or threatened would not in the aggregate, have a
Material

                                       18
<PAGE>

Adverse Effect. The Company is unaware of any facts or circumstances which might
give   rise   to   any   of   the   foregoing   infringements   or   claims,   actions   or
proceedings   which   would,   individually   or in the   aggregate,   have a Material
Adverse Effect. The Company and the Subsidiaries have taken reasonable   security
measures   to   protect   the   secrecy,   confidentiality   and value of all of their
Intellectual Property Rights.

                   (v)   ENVIRONMENTAL   LAWS. The Company and the Subsidiaries (i)
are in compliance with any and all Environmental Laws (as hereinafter   defined),
(ii) have   received all permits,   licenses or other   approvals   required of them
under   applicable   Environmental   Laws to conduct their   respective   businesses,
(iii)   are in   compliance   with all   terms and   conditions   of any such   permit,
license or approval and (iv) to the   Company's   knowledge,   there are no events,
conditions   or   circumstances   reasonably   likely to result in   liability of the
Company or any Subsidiary   pursuant to Environmental   Laws, except where, in the
foregoing   clauses   (i)   through   (iv)   the   failure   to   so   comply   with   such
Environmental   Laws,   permits,   licenses   or other   approvals   or to obtain such
permits,   licenses   or   approvals   would   not be   reasonably   expected   to have,
individually   or   in   the   aggregate,    a   Material   Adverse   Effect.   The   term
"ENVIRONMENTAL LAWS" means all federal, state, local or foreign laws relating to
pollution or protection of human health or the environment   (including,   without
limitation,   ambient air, surface water, groundwater, land surface or subsurface
strata), including, without limitation, laws relating to emissions,   discharges,
releases or threatened releases of chemicals, pollutants, contaminants, or toxic
or hazardous substances or wastes (collectively, "HAZARDOUS MATERIALS") into the
environment, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials,
as well as all   authorizations,   codes,   decrees,   demands   or   demand   letters,
injunctions,   judgments,   licenses,   notices or notice letters, orders, permits,
plans or regulations issued, entered, promulgated or approved thereunder.

                  (w) SUBSIDIARY   RIGHTS. The Company or one of its Subsidiaries
has the   unrestricted   right to vote,   and   (subject to   limitations   imposed by
applicable   law)   to   receive    dividends   and   distributions   on,   all   capital
securities   of   its   Subsidiaries   owned   by the   Company   or   such   Subsidiary,
respectively,    subject   to   the   Transaction   Documents   and   the   Senior   Loan
Documents.   Each   Target   or   one   of   their   respective   Subsidiaries   has   the
unrestricted   right to vote, and (subject to   limitations   imposed by applicable
law) to receive dividends and   distributions   on, all capital   securities of its
Subsidiaries   as   owned   by such   Target   or   such   Subsidiary,   subject   to the
Transaction Documents and the Senior Loan Documents.

                  (x) TAX   STATUS.   Except as set forth on   SCHEDULE   3(X),   the
Company and each   Subsidiary (i) has made or filed all foreign,   federal,   state
and local income and all other tax returns, reports and declarations required by
any   jurisdiction   to which it is   subject,   (ii) has paid all   taxes   and other
governmental   assessments   and charges   that are   material   in amount,   shown or
determined to be due on such   returns,   reports and   declarations,   except those
being   contested   in good faith and for which the Company   has made   appropriate
reserves on its books and (iii) has set aside on its books provision   reasonably
adequate for the payment of all taxes for periods   subsequent   to the periods to
which   such   returns,   reports   or   declarations   apply.   Except as set forth on
SCHEDULE   3(X),   there are no   material   unpaid   taxes   claimed to be due by the
taxing authority of any jurisdiction, and the officers of the Company know of no
basis for any such claim. Each of the claims set forth on SCHEDULE 3(X) is being
contested   in good   faith   or   would   not be   expected,   individually   or in the
aggregate,   to have a Material   Adverse Effect.   Except as

                                        19
<PAGE>

set forth on SCHEDULE   3(X), no liens have been filed   securing   taxes and other
governmental   assessments   and   charges   and no claims are being   asserted by or
against the Company or any of the   Subsidiaries   in respect of any taxes   (other
than liens for taxes not yet due and payable) or other governmental   assessments
or charges.   Except as set forth on SCHEDULE 3(X), none of the Company or any of
the Subsidiaries has received notice of assessment or proposed assessment of any
taxes   claimed   to be owed by it or any other   Person on its   behalf.   Except as
disclosed on SCHEDULE 3(X), none of the Company or any of the   Subsidiaries is a
party to any tax sharing or tax indemnity   agreement or any other agreement of a
similar   nature that remains in effect.   None of the items set forth on SCHEDULE
3(X) would,   individually or in the aggregate,   have a Material   Adverse Effect.
Each of the Company and the Subsidiaries   has complied in all material   respects
with all applicable legal   requirements   relating to the payment and withholding
of taxes and, within the time and in the manner   prescribed by law, has withheld
from wages, fees and other payments and paid over to the proper   governmental or
regulatory authorities all amounts required.

                  (y) INTERNAL ACCOUNTING CONTROLS.   The Company and each of the
Subsidiaries   maintains a system of internal   accounting   controls sufficient to
provide   reasonab