VISTA MEDICAL TECHNOLOGIES INC
EX-10.1
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<p align="right" style="margin:0in 0in .0001pt;text-align:right;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Exhibit 10.1</font></b></p>

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<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Vista Medical Technologies Inc</font></b><br>
2101 Faraday Avenue<br>
Carlsbad, CA&nbsp;92008</p>

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<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">March 30, 2004</font></p>

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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dawson James Securities,</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A Division of Viewtrade
Financial</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">c/o Dawson James Securities</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6400 NW 6th Way</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Suite 310</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Ft. Lauderdale, FL 33309</font></p>

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<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Re:&#160; <u>Selling Agreement (the &#147;Agreement&#148;)</u></font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Gentlemen:</font></p>

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<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Vista Medical
Technologies, Inc., a Delaware corporation (the &#147;Seller&#148;), proposes to offer
and sell (the &#147;Offering&#148;), to selected investors, upon the terms set forth
herein and in the Confidential Private Placement Memorandum and other documents
to be supplied to the investors (which collectively, together with the
attachments and exhibits thereto, is referred to as the &#147;Offering Document&#148;), a
copy of which has been delivered to you, up to 4,000,000 units (the &#147;Units&#148;);
each Unit consisting of 1 share of Common Stock (the &#147;Common Stock&#148;) and a
warrant to purchase &#189; share of Common Stock (the &#147;Warrants&#148;).&#160; The Common Stock and Warrants shall have
those provisions described in Exhibit B hereto, and shall be acceptable to the
Selling Agent.&#160; (The Units are sometimes
referred to hereafter as the &#147;Offered Securities&#148;).&#160; Viewtrade Financial (the &#147;Selling Agent&#148;) agrees to offer and
sell on an exclusive &#147;best efforts, all or none&#148; basis, that number of Units
that results in an aggregate sales price of at least $4,000,000&#160; (the &#147;Minimum Number&#148;), and on a best
efforts basis with respect to additional Units having an aggregate sales price
of no more than $1,000,000, during the offering period described in the
Offering Document (the &#147;Offering Period&#148;). Capitalized terms used and not
otherwise defined herein shall have the respective meanings set forth in the
Offering Document.&#160; It is intended that
the offer, offer for sale and sale of the Offered Securities will be exempt
from the federal registration requirements of the Securities Act of 1933, as
amended (the &#147;1933 Act&#148;), pursuant to Regulation&nbsp;D promulgated under
Section&nbsp;3(b) and/or Section&nbsp;4(2), respectively, of the 1933 Act and
will qualify for an exemption from registration, if necessary, under the
applicable state securities laws and regulations.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The Seller
hereby confirms its agreement with Selling Agent as follows:</font></p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Offer and Sale of
Offered Securities by Selling Agent; Compensation; Closing</u>.</p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.1</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>On the basis of Selling
Agent&#146;s representations, covenants and warranties, the Seller appoints Selling
Agent the agent of the Seller for the period commencing on the date of the
completion of the Offering Document and ending on the date set forth in the
Offering Document, unless extended by the Seller and Selling Agent by their
mutual agreement for a period not to exceed an additional ninety (90) days
(&#147;Offering Termination Date&#148;), to use Selling Agent&#146;s best efforts to offer and
sell, on the terms and conditions set forth in this Agreement and in the
Offering Document, subject only to Selling Agent&#146;s right to engage
participating broker-dealers pursuant to Section&nbsp;2 hereof.&#160; The Selling Agent hereby accepts such
appointment and agrees pursuant to the terms and conditions set forth herein
and in the Offering Document to use its best efforts to offer and sell the
Offered Securities as agent for the Seller during the period specified above,
and to attempt to find suitable accredited purchasers for the Offered
Securities acceptable to the Seller.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.2</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Prior to and subject to
the closing, subscription proceeds from the sale of the Offered Securities will
be deposited in an escrow account at Silicon Valley Bank (the &#147;Escrow
Agent&#148;).&#160; The Seller will be responsible
for setting up the Escrow Account, pursuant to an escrow agreement among the
Seller, the Selling Agent and the Escrow Agent, which escrow agreement will be
approved by the Selling Agent.&#160;
Subscribers will be instructed to make their checks payable to &#147;Silicon
Valley Bank, Escrow Agent for Vista Medical Technologies, Inc.,&#148; or shall cause
the wire transfer of immediately available funds in favor of Silicon Valley
Bank, Escrow Agent for Vista Medical Technologies, Inc., in accordance with
instructions provided by the Selling Agent.&#160;
Unless at least the Minimum Number of Units have been sold during the
Offering Period (as the same may be extended by the mutual agreement of the
Selling Agent and the Seller), the Offering will be terminated at the end of
the Offering Period, no Offered Securities will be sold in the Offering and all
subscription proceeds will be refunded to subscribers by the Escrow Agent,
without interest thereon.&#160; If
subscriptions for at least the Minimum Number of Units are received by the end
of the Offering Period (as the same may be extended by the mutual agreement of
the Selling Agent and the Seller), a closing (the &#147;First Closing&#148;) will occur
as soon as possible after subscriptions for the Minimum Number have been
accepted by the Seller.&#160; After the First
Closing, one or more subsequent closings (the &#147;Additional Closings&#148;) will occur
thereafter on such dates as mutually determined by the Seller and the Selling
Agent, but in no event later than ten (10) days after the end of the Offering
Period.&#160; (The First Closing and any
Additional Closing shall each be referred to herein as a &#147;Closing&#148; and the last
of the Closings shall be referred to as the &#147;Final Closing&#148;).</p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.3</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>For purposes hereof,
the Minimum Number of Units shall not be deemed to have been sold unless (x) subscription
agreements, completed and fully executed by subscribers who are accredited
investors have been received covering the Minimum Number of the Units and (y)
all checks, drafts and wire transfers submitted by such subscribers in payment
of the purchase price of such Units have been received by the Escrow Agent and
have cleared so that there are &#147;good funds&#148; in the Escrow Account at least
equal to the aggregate purchase price of the Minimum Number of Units.</p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.4</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>As compensation for the
Selling Agent&#146;s services hereunder, the Seller shall pay to Selling Agent in
cash a selling commission (&#147;Commission&#148;) upon each Closing, in an amount equal
to eight percent (8%) of the aggregate offering price of the Offered Securities
sold by the Selling Agent or its authorized agent at such Closing. At each
Closing of the Offering, the Seller shall pay the Selling Agent its Commission
relating to the sale of the Offered Securities that are subject of the Closing
provided that the Seller or counsel for the Seller has received all documents,
including but not limited to, an executed Subscription Agreement for each
investor (&#147;Subscription Documents&#148;) previously furnished to Selling Agent which
the Selling Agent is required to deliver to the Seller or counsel for the Seller
prior to Closing.&#160; All or any portion of
such Commission may be re-allowed to Participating Broker-Dealers (as
hereinafter defined).&#160; No Offered
Securities shall be considered to have been sold by Selling Agent or any
Participating Broker-Dealer selected by Selling Agent unless the purchaser is
acceptable to the Seller, and no compensation will be payable with respect to
any agreement for the purchase of Offered Securities if the Subscription
Agreement therefor is not actually accepted by the Seller.&#160; Anything in this Agreement to the contrary
notwithstanding, the Seller shall not be required to pay a Commission to
Selling Agent and Selling Agent shall not be entitled to a Commission, pursuant
to this Section&nbsp;1.4 or any other provision, if to do so would cause the
Seller to violate federal or state securities laws, regulations or rules or any
other law applicable to the Offering.</p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.5</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller will pay all
of its costs relating to the Offering contemplated hereby, including, without
limitation, audit expenses, issuance costs and taxes, counsel fees for the
preparation of the Offering Documents, filing fees and disbursements of counsel
relating to the qualification of the Offered Securities under federal
securities laws, and legal fees and expenses of counsel in connection with
qualifying the Offered Securities under the state blue sky laws.&#160; To the extent required by law, the Seller
shall qualify the Offered Securities for offer and sale in those jurisdictions
designated by the Selling Agent.&#160; The
Seller&#146;s counsel shall be responsible for state blue sky securities laws
compliance by the Seller.</p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.6</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller shall pay
the Selling Agent at each Closing a non-accountable expense allowance of 2% of
the aggregate dollar value of Units sold at such Closing, $10,000 of which
shall be advanced to Selling Agent contemporaneous with the execution of this
Agreement.</p>

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<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;">1.7</font><font size="1" style="font-size:8.5pt;layout-grid-mode:both;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font style="layout-grid-mode:both;">Once the Offered Securities are sold, or the
Offering Period terminates, the agency between the Seller and the Selling Agent
shall terminate.&#160; The Selling Agent, on
the basis of the representations and warranties herein contained, but subject
to the terms and conditions herein set forth, accepts such appointment as the
limited agent of the Seller and agrees to use its best efforts to find
purchasers for the Offered Securities.</font></p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.8</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Upon each Closing of
the sale of the Offered Securities offered by the Seller hereunder, the Seller
will issue to the Selling Agent at a purchase price of $.001 per warrant,
warrants to purchase ten percent (10%) of the Units sold in the Offering</p>

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<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(&#147;Selling Agent&#146;s Warrants&#148;).&#160;
The Selling Agent&#146;s Warrants shall be exercisable at any time during the
five (5) years from the date of First Closing at an exercise price equal to one
hundred and twenty percent (120%) of the offering price. The Selling Agent&#146;s
Warrants shall be in the form and shall contain the provisions set forth in
Exhibit A attached hereto.</font></p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1.9</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>As of the effective
date of this Agreement, the Seller grants to the Selling Agent, the exclusive
right to act as the Selling Agent for the Seller, with respect to this
financing and/or any future financing consummated by the Seller during a period
of Twelve (12) months commencing on the Date of the First Closing.</p>

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<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;">1.10</font><font size="1" style="font-size:8.5pt;layout-grid-mode:both;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><font style="layout-grid-mode:both;">Each Closing shall be held at the offices of the
Selling Agent, 6400 NW 6th Way, Suite 310, Ft. Lauderdale, FL 33309, or in an
alternative location and at such time and date as Selling Agent and the Seller
may mutually agree.</font></p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Participating
Broker-Dealers</u>.&#160; The Seller hereby
authorizes Selling Agent to engage other qualified broker-dealers (the
&#147;Participating Broker-Dealers&#148;) to assist the Selling Agent in the placement of
the Offered Securities; provided that during all times that each such
Participating Broker-Dealer shall offer and sell the Offered Securities, each
such Participating Broker-Dealer shall be registered as a broker-dealer under
the Securities Exchange Act of 1934 (the &#147;1934 Act&#148;), shall be a member in good
standing of the National Association of Securities Dealers, Inc. (&#147;NASD&#148;), and
shall be authorized to offer and sell the Offered Securities under the laws of
the jurisdictions in which the Offered Securities will be offered and sold by
such Participating Broker-Dealer.&#160; All
Participating Broker-Dealers will be required to execute a Participating
Broker-Dealer Agreement, the form of which is subject to the reasonable
approval of the Seller, with Selling Agent containing substantially the same
terms and conditions as this Agreement, including, without limitation, the
representations and warranties contained in Section&nbsp;3.2 below and
provisions for indemnification of the Seller to the same extent as your
indemnification provided in Section&nbsp;7 below.&#160; Any commissions, fees, or expenses payable to such Participating
Broker-Dealers will be paid by the Selling Agent and not by the Seller.</p>

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<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Representations,
Warranties and Covenants</u>.</p>

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<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.1</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller represents,
warrants and covenants to Selling Agent that, except as set forth in Schedule
3.1 hereof:</p>

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<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller and each
subsidiary is a corporation duly formed and validly existing and in good
standing under the laws of the jurisdiction of its incorporation as in effect
on the date of this Agreement, with adequate power and authority to enter into
and perform this Agreement and to own its property and to conduct its business
as described in the Offering Document; and the Seller and each subsidiary is
duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which it owns or leases substantial properties
or in which the conduct of its business requires such qualification except for
such jurisdictions in which the</p>

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<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">failure to qualify in the aggregate would not have
material and adverse effect on the earnings, affairs or business prospects of
the Seller or any such subsidiary (a &#147;Material Adverse Effect&#148;) and in which
jurisdictions such failure may be cured without such Material Adverse Effects;
the execution and delivery of this Agreement by the Seller has been duly and
validly authorized and will not result in a breach of its Certificate of
Incorporation or By-laws; and when executed and delivered by both parties
hereto, this Agreement will be a valid and binding obligation of the Seller,
assuming the due execution by the Selling Agent, enforceable in accordance with
its terms (except to the extent that enforceability of the indemnification
provisions may be limited under applicable securities laws and except as
enforcement may be limited by bankruptcy, moratorium or other laws affecting
creditors&#146; rights or general principles of equity); and the execution and
delivery of this Agreement, the consummation of the transactions herein
contemplated and compliance with the terms of this Agreement by the Seller do
not and will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any agreement or any applicable
law, rule, regulation, judgment, order or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Seller, to which the Seller is a party or by which it is bound;</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Offering Document
does not contain and will not contain, at any time between the date hereof and
to and including the date of each Closing, any untrue statement of a material
fact and does not omit nor during such period will omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;</p>

<p style="margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except as is otherwise
disclosed in the Offering Document, there is no litigation or governmental
proceeding pending or, to the best of its knowledge, threatened against or
involving the property or business of the Seller or any subsidiary of the
Seller;</p>

<p style="margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except as is otherwise
disclosed in the Offering Document, no material defaults exist in the due
performance and observance of any material obligation, term, covenant or
condition of any agreement or instrument to which the Seller or any subsidiary
is a party or by which they are bound;</p>

<p style="margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The offer, offer for
sale, and sale of the Offered Securities have not been and will not be
registered with the Securities and Exchange Commission (the &#147;SEC&#148;) except as
contemplated in the Offering Document.&#160;
The Company&#146;s actions with respect to the offer, offer for sale and sale
of the Offering Securities will be pursuant to the exemptions from the
registration requirements of Section&nbsp;5 of the 1933 Act provided by
Section&nbsp;4(2) thereof and/or by Regulation&nbsp;D thereunder;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>To the best of its
knowledge and belief, assuming the offer, offer for sale and sale of the
Offered Securities is made in compliance with the terms of the Offering
Document, the applicable filings with the SEC and any applicable Blue Sky</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">States, and subject to the performance of the Selling Agent&#146;s
obligations hereunder, the Seller will have complied in all material respects
with the 1933 Act and with all state securities laws and regulations applicable
to it in connection with the offer, offer for sale, and sale of the Offered
Securities.&#160; The Seller has not taken
and will not take any action in conflict with the 1933 Act or applicable state
or foreign securities or Blue Sky laws, or which would make the exemption, qualification
or registration pursuant to applicable federal or state securities or Blue Sky
laws unavailable with respect to the offer, offer for sale and sale of the
Offered Securities.&#160; The Seller and its
officers, directors or partners are not subject to any disqualification,
including but not limited to any judgment, decree, order or decision issued by
the SEC, any state or foreign securities regulatory authority, any court of
competent jurisdiction or the United States Postal Service.&#160; In offering the Offered Securities, the
Seller will comply with all applicable federal, state or foreign securities
laws, including the rules covering exemptions from registration;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Subject to the
performance of the Selling Agent&#146;s obligations hereunder, the Offered
Securities, upon the payment therefor and issuance thereof, will conform to all
statements and descriptions in relation thereto contained in the Offering
Document and will have the rights set forth in the Seller&#146;s Certificate of
Incorporation;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(h)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>To the best of the
Seller&#146;s knowledge, the Seller has neither been engaged in, nor been the
subject of, any of the actions or proceedings specified in subsection&nbsp;(a)
of Rule&nbsp;262 promulgated under Section&nbsp;3(b) of the 1933 Act, or any
substantially similar provisions under the securities laws of any state in
which the Offered Securities are to be sold, such that no exemption from
registration would be available for the offering of the Offered Securities by
the Seller under applicable federal or state securities laws;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Since the respective
dates as of which information is given in the Offering Document, there has been
no material adverse change in the condition, business, property, capital
commitments, working capital and liabilities or prospects of the Seller or any
subsidiary, financial or otherwise; and the property and business of the Seller
materially conform to the descriptions thereof contained in the Offering
Document; there have been no material liabilities or obligations incurred or
material transactions entered into by the Seller or any subsidiary other than
those in the ordinary course of business; there have been no dividends or
distributions of any kind declared, paid or made by the Seller on its capital
stock; there has not been any change in the capital stock, or any material
increase in the current or long-term debt except as disclosed in the Offering
Document, or any issuance of options, warrants, convertible securities or other
rights to purchase the capital stock of the Seller or any subsidiary; and there
have been no transactions between the Seller, shareholders owning five percent
(5%) or more of its issued and outstanding capital stock, the Seller&#146;s officers
and/or directors, nor have there been any corporate opportunities taken or
assumed by controlling shareholders, officers or directors, that are not fully
disclosed in the Offering Document.</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(j)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller will notify
the Selling Agent immediately and confirm the notice in writing (i) of the
issuance by the SEC or by any state attorney general or securities
administrator of any order enjoining the sale of the Offered Securities or
suspending the effectiveness of any qualification of the Offered Securities for
sale or (ii) of the initiation of any proceedings for that purpose.&#160; The Seller will make every reasonable effort
to prevent the issuance of any such order and, if any such order shall at any
time be issued, to obtain the lifting thereof at the earliest possible moment;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(k)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The audited and
unaudited combined financial statements of the Seller (including the related
notes) included in the Offering Document present fairly the financial position
of the Seller and its subsidiaries at the dates indicated; said financial
statements have been prepared in conformity with United States generally
accepted accounting principles applied on a consistent basis, except as
expressly qualified therein, and are in conformity with Regulation S-X
promulgated under the Act;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(l)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except as set forth in
the Offering Document, the Seller does not have any subsidiaries and does not
own any interest in any other corporation, partnership, joint venture or other
entity;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(m)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>As of the date of this
Agreement, the Seller and its subsidiaries have not agreed, or agreed in
principle, to any merger or acquisition, or combination with, of any other
corporation, partnership, person, party, entity or trust or the sale of its
business or assets to any other corporation, partnership, person, party, entity
or trust;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(n)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller and its
subsidiaries have not, directly or indirectly, at any time during their
existence (i) made any unlawful contribution to any candidate for political
office, or failed to disclose fully any contribution in violation of law, or
(ii) made any payment to any federal, state or foreign governmental officer or
official, or other person charged with similar public or quasi-public duties,
other than payments required or permitted by the laws of the United States or
any jurisdiction thereof;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(o)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>To the best of Seller&#146;s
knowledge, the Seller and its subsidiaries have filed all necessary federal, state,
local, foreign and other tax returns required to be filed by them and have paid
all taxes shown as due thereon; the Seller and its subsidiaries have not been
notified, either orally or in writing, that any state, local, federal or
foreign taxing authority is conducting or intends to conduct an audit of any
tax return or report filed by the Seller and its subsidiaries or concerning
their business or properties; and the Seller has no knowledge of any tax
deficiency which has been asserted or threatened against the Seller and any
subsidiary which would materially and adversely affect the business,
properties, financial condition, results of operations, liabilities or working
capital of the Seller;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(p)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller and its
subsidiaries make and keep accurate books and records and maintain internal
accounting controls which provide reasonable</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">assurance that (i) transactions are executed in
accordance with management&#146;s authorization, (ii) transactions are recorded as
necessary to permit preparation of its financial statements and to maintain
accountability for its assets, (iii) access to their assets is permitted only
in accordance with management&#146;s authorization, and (iv) the reported assets are
compared with existing assets at reasonable intervals;</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(q)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>There are no
pre-emptive rights applicable to any of the Seller&#146;s outstanding securities, or
granted by the Seller to any person or party;</p>

<p style="margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(r)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The capitalization of
the Seller is as described in the Offering Document and the Seller has
outstanding no more than 5,450,251 shares of its Common Stock as of the date
hereof; all presently outstanding shares of the Seller&#146;s Common Stock are duly
and validly authorized and issued, fully paid and non-assessable and contain no
preemptive rights; the Seller has not contracted for the issuance of any
additional equity securities other than as set forth herein or as contemplated
or described in the Offering Document; and no shares of any other classes of
equity securities are issued and outstanding;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;">(s)</font><font size="1" style="font-size:8.5pt;layout-grid-mode:both;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The
Seller agrees that, for a period of twelve (12) months from the date hereof, it
shall not solicit any offer to buy from or offer to sell to any person
introduced to the Seller by the Selling Agent in connection with the Offering,
directly or indirectly, any securities of the Seller or provide the name of any
such person to any other securities broker or dealer or selling agent.&#160; In the event that the Seller or any of its
affiliates, directly or indirectly, solicits, offers to buy from or offers to
sell to any such person any such securities, or provides the name of any such
person to any other securities broker or dealer or selling agent, and such
person purchases such securities or purchases securities from any other
securities broker or dealer or selling agent, the Seller shall pay to the
Selling Agent an amount equal to 8 percent (8%) of the aggregate purchase price
of the securities so purchased by such person; and t<font style="layout-grid-mode:both;">he Seller is in compliance with all (i) all applicable provisions of the
Sarbanes-Oxley Act of 2002, and the rules and regulations promulgated
thereunder, and (ii) all listing standards and rules promulgated by the NASD.</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;layout-grid-mode:both;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">3.2</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent
represents and warrants to the Seller as follows:</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent is,
has been and will be at all times during the Offering Period, a Delaware
corporation duly organized and validly existing under the laws of the state of
its incorporation, with all requisite power and authority to enter into and
perform this Agreement; the execution and delivery of this Agreement by the
Selling Agent has been duly and validly authorized; and when executed and
delivered by the Seller, this Agreement will be a valid and binding obligation
of the Selling Agent enforceable in accordance with its terms subject to:&#160; (i)&nbsp;due authorization, execution and
delivery hereof by the Seller; (ii) the enforcement of remedies under
applicable bankruptcy, insolvency and other laws affecting creditors&#146; rights
generally and moratorium laws from time to time in effect; (iii) general
equitable principles which may</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">limit the right to obtain the remedy of specific
performance; and (iv) the public policy limitation on indemnification under the
federal securities laws;</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent shall
not offer or sell the Offered Securities in any state or states without the
approval of the Seller and completion by the Seller of all, or any, Blue Sky
filings for such states and shall not offer or sell the Offered Securities in
any state or states in which it is not qualified or registered as a broker-dealer
or authorized to engage in the brokerage business; and</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent is
(i) a broker-dealer registered with the SEC pursuant to the 1934 Act, and no
proceeding has been initiated to revoke such registration; (ii) a member in
good standing of the NASD; and (iii) a broker-dealer registered with the
securities authorities of each jurisdiction in which it is required to be
registered in connection with the offers or sales of the Offered Securities,
and all such offers or sales will be made only by individuals licensed as
required by all applicable federal and state securities laws.&#160; The Selling Agent agrees to maintain each of
the foregoing memberships and registrations in good standing throughout the
Offering Period.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent has
no material litigation pending against it or its affiliates.</p>

<p align="left" style="margin:0in 0in .0001pt .5in;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent does
not currently have any material enforcement action or disciplinary procedure
against it or its affiliates.</p>

<p align="left" style="margin:0in 0in .0001pt .5in;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt .5in;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Selling Agent will
require that each purchaser of Offered Securities hereunder represent that such
purchaser is an accredited investor and will solicit only accredited investors.</p>

<p align="left" style="margin:0in 0in .0001pt .5in;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Sale and Delivery
of Offered Securities</u>.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4.1</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>No sale of Offered
Securities shall take place or be regarded as effective unless and until
accepted by the Seller, such acceptance to occur at Closing, and the Seller
reserves the right in its sole and absolute discretion to refuse to sell
Offered Securities to any or all persons at any time.&#160; Selling Agent shall send to the Seller and to the Escrow Agent
designated in Section 1.2, with copies to counsel for the Seller, all
acceptable executed Subscription Documents, promptly upon receipt of the same,
subject to any reasonable delay occasioned by further inquiry as to a
prospective purchaser&#146;s qualification or requests by the Seller or Selling
Agent for further information from a prospective purchaser.&#160; The Seller shall notify Selling Agent as to
whom to send the originals of such executed Subscription Documents and to whom
to send copies.&#160; Selling Agent shall
promptly send each such prospective purchaser&#146;s payment for his Offered
Securities to Silicon Valley Bank, the Escrow Agent.&#160; Subject to review by counsel for the Seller, the Seller shall
notify Selling Agent whether such prospective purchaser will be accepted by the
Seller at Closing within ten (10) business days after receipt of the executed
subscription documents for each prospective purchaser of Offered Securities,</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">but in no event later than the earlier of (i) the date
the parties have agreed to for Closing or (ii) the Offering Termination
Date.&#160; For every prospective purchaser
of Offered Securities whose subscription is rejected, the Seller will promptly
return all of such prospective purchaser&#146;s executed Subscription Documents to
Selling Agent for return to the prospective purchaser, and will notify the
Escrow Agent to return the funds received to such prospective purchaser without
interest and without deduction.</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">5.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Conditions to the
Obligations of the Seller</u>.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The obligations of the
Seller hereunder are subject to the accuracy of Selling Agent&#146;s representations
and warranties, to the observance and performance by Selling Agent of its
obligations hereunder, and to the following further conditions (any of which
may be waived in writing in whole or in part by the Seller):</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Selling Agent shall not
have taken or failed to take any action at any time at or prior to Closing,
which, in the opinion of the Seller or counsel for Seller, conflicts or would
conflict with, or otherwise make unavailable, the exemption from registration
requirements for the offer and sale of the Offered Securities under applicable
securities laws and regulations.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If any of the
conditions specified in this Section&nbsp;5 shall not have been fulfilled when
and as required by this Agreement to be fulfilled, all the obligations of the
Seller under this Agreement may be terminated in writing at any time at or
prior to Closing, and any such termination shall be without liability to the
parties, and further provided that the obligations under Section&nbsp;7 and
Section&nbsp;9.1 shall nevertheless survive and continue thereafter.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Conditions of the
Obligations of the Selling Agent</u>.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The
obligations of the Selling Agent to act as agent hereunder, to find purchasers
for the Offered Securities, and to attend and to deliver documents at Closing
shall be subject to the following conditions:</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Between the date hereof
and Closing, the Seller and its subsidiaries shall not have sustained any loss
on account of fire, explosion, flood, accident, calamity or other cause, of
such character as results in a Material Adverse Effect on the Seller and its
subsidiaries, whether or not such loss is covered by insurance.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Between the date hereof
and Closing, there shall be no material litigation instituted or threatened
against the Seller or any subsidiary (other than as set forth in the Offering
Document) and there shall be no material proceeding instituted or threatened
before or by any federal or state commission, regulatory body or administrative
agency or other governmental body, domestic or foreign, wherein an unfavorable
ruling, decision or finding would materially adversely affect the business,
franchises, licenses, permits, operations or financial condition or income of
the Seller.</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except as contemplated
herein or as set forth in the Offering Document, during the period subsequent
to the date hereof, and prior to Closing, the Seller and each subsidiary:&#160; (i) shall have conducted its business in the
usual and ordinary manner as the same was being conducted on the date hereof,
and (ii) except in the ordinary course of its business, the Seller and each
subsidiary shall not have incurred any liabilities or obligations (direct or
contingent), or disposed of any assets, or entered into any material
transaction or suffered or experienced any substantially adverse change in its
condition, financial or otherwise, or in its working capital position.&#160; At Closing, the capitalization of the Seller
shall be substantially the same as set forth in the Offering Document.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(d)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The authorization for
the issuance and delivery of the Offered Securities and the Offering Document
and related materials, and for the execution and delivery of this Agreement,
and all other legal matters incident thereto, shall be reasonably satisfactory
in all respects to counsel for Selling Agent.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(e)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller shall have
furnished to the Selling Agent the opinion, dated the Closing Date, of its
counsel, which opinion shall be acceptable to the Selling Agent, substantially
in the form of attached Exhibit:</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(f)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The representations
and warranties of the Seller made in this Agreement or in any document or
certificate delivered to the Selling Agent pursuant hereto shall be true and
correct on and as of the Closing with the same force and effect as though such
representations and warranties have been made on and as of the Closing, and the
Selling Agent shall have received a certificate, dated the Closing Date, to
such effect executed by the Chairman of the Board or President of the Seller.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(g)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller shall have
performed and complied in all material respects with all covenants, terms and
agreements to be performed and complied with by the Seller on or before the
Closing.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(h)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller shall have
provided such certificates as the Selling Agent shall reasonably request.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(i)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller and its
President shall provide certificates to the Selling Agent certifying that the
proceeds of the Offering will be used in accordance with the uses designated in
&#147;Use of Proceeds&#148; in the Offering Document.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(j)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller shall have
furnished a &#147;Cold Comfort&#148; letter on and as of the Closing, in each case
describing procedures carried out to a date within five (5) days of the date of
the letter, from Ernst &amp; Young LLP, independent public accountants for the
Seller, substantially in the form approved by the Selling Agent.</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Indemnification</u>.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.1</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The Seller agrees to
indemnify and hold harmless Selling Agent and each person, if any, who controls
Selling Agent within the meaning of the 1933 Act or the 1934 Act (together, the
&#147;Acts&#148;), the Selling Agent&#146;s affiliated entities, partners, employees, legal
counsel and agents (the &#147;SA Indemnified Parties&#148;) against any losses, claims,
damages, obligations, penalties, judgments, awards, liabilities, costs,
expenses and disbursements (and any and all actions, suits, proceedings and
investigations in respect thereof and any and all legal and other costs,
expenses and disbursements in giving testimony or furnishing documents in
response to a subpoena or otherwise), joint or several, to which Selling Agent
or such person may be subject, under the Acts or otherwise, including, without
limitation, the costs, expenses and disbursements, as and when incurred, of
investigating, preparing or defending any such action, suit, proceeding or
investigation (whether or not in connection with litigation in which the
Selling Agent is a party), directly or indirectly, caused by, relating to,
based upon, arising out of, or in connection with (i) the violation or breach
of any representation, warranty or covenant or agreement of the Seller set
forth in this Agreement or in any instrument, document, agreement or
certificate delivered by the Seller in connection herewith; (ii) any untrue
statement or omission or any alleged untrue statement or omission in the
Offering Document or selling material, excluding information contained in or
omitted from the Offering Document or selling material in reliance upon, and in
conformity with, information furnished to the Seller by Selling Agent or any
Participating Broker-Dealer specifically for use in preparation of the Offering
Document or selling material, as the case may be; (iii) any information
provided by or on behalf of Seller in order to qualify or exempt the Offered
Securities for sale in any jurisdiction; or (iv) the failure of the Seller to
comply with the provisions of the Acts and the regulations thereunder,
including Regulation&nbsp;D; and will reimburse the SA Indemnified Parties for
any legal or other expenses reasonably incurred by the SA Indemnified Parties
in connection with investigation of or defending against any such loss, claim,
expense, damage, liability, (or actions in respect thereof); provided, however,
that the Seller shall not be required to indemnify the SA Indemnified Parties
for any payment made to any claimant in settlement of any suit or claim unless
such payment is agreed to by the Seller (which agreement shall not be
unreasonably withheld) or by a court having jurisdiction of the controversy.&#160; This indemnity agreement shall remain in
full force and effect notwithstanding any investigation made by Selling Agent
or on Selling Agent&#146;s behalf, shall survive consummation of the sale of the
Offered Securities hereunder and shall be in addition to any liability which
the Seller may otherwise have.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.2</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Selling Agent agrees to
indemnify and hold harmless the Seller and each person, if any, who controls
the Seller within the meaning of the Acts, Seller&#146;s affiliated entities,
partners, employees, legal counsel and agents (the &#147;Seller Indemnified
Parties&#148;) against any losses, claims, expenses, damages or liabilities (or
actions in respect thereof), joint or several, to which the Seller Indemnified
Parties or any such controlling person may become subject, under the Acts or
otherwise, insofar as such losses, claims, expenses, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or omission or any alleged untrue statement or omission in the Offering
Document contained in or omitted from the Offering Document in reliance upon,
and in conformity with, information furnished to the Seller by Selling Agent or
any</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Participating Broker-Dealer or either of them
specifically for use in preparation of the Offering Document or selling
material, as the case may be; and will reimburse the Seller Indemnified Parties
for any legal or other expenses reasonably incurred by them in connection with
investigating or defending against any such loss, claim, expense, damage,
liability, (or actions in respect thereof); provided, however, that Selling
Agent shall not be required to indemnify the Seller Indemnified Parties for any
payment made to any claimant in settlement of any suit or claim unless such
payment is approved by a court having jurisdiction over the controversy or
Selling Agent agrees to such settlement (which agreement shall not be
unreasonably withheld); and provided further that Selling Agent shall not be
liable under this Section&nbsp;7.2 for any losses, claims, expenses, damages or
liabilities arising out of any act or failure to act on the part of any other
person except Selling Agent, its partners, employees and agents (including
registered representatives) or any Participating Broker-Dealer.&#160; This indemnity agreement shall remain in
full force and effect notwithstanding any investigation made by or on behalf of
the Seller and shall survive consummation of the sale of the Offered Securities
hereunder and the termination of this Agreement, and shall be in addition to
any liability which Selling Agent may otherwise have.&#160; Notwithstanding the foregoing, in no event shall the amount that
the Selling Agent is required to indemnify the Seller Indemnified Parties,
exceed in the aggregate the compensation received by the Selling Agent hereunder,
except in the case of fraud on the part of the Selling Agent.</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">7.3</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The indemnified party
shall notify the indemnifying party in writing promptly after the summons or
other first legal process giving information of the nature of any and all claims
which have been served upon the indemnified party.&#160; In case any action is brought against any indemnified party upon
any such claim, the indemnifying party shall be entitled to participate at its
own expense in the defense, or if it so elects, in accordance with arrangements
satisfactory to any other indemnifying party or parties similarly notified, to
assume the defense thereof, with counsel who shall be satisfactory to such
indemnified party and other indemnified parties who are defendants in such action;
and after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and the retaining of such counsel by
the indemnifying party, the indemnifying party shall not be liable to such
indemnified party under this Section&nbsp;7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof, other than the reasonable costs of investigation, unless the
indemnified party shall have reasonably concluded that there are or may be
defenses available to it which are different from or in addition to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to direct the defense of such action on behalf of the
indemnified party), in any of which circumstances such expenses shall be borne
by the indemnifying party.</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='',FILE='C:\jms\eudelhofen\04-6532-1\task133850\6532-1-kc.htm',USER='eudelho',CD='May 28 13:17 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Termination of
Agreement</u>.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.1</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>This Agreement shall
terminate:</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If at any time after
commencement of the Offering, any material condition of Selling Agent&#146;s
obligations hereunder shall not have been met or shall cease to be met and
Selling Agent shall have given to the Seller notice of Selling Agent&#146;s desire
to terminate this Agreement on account of the nonfulfillment of such condition;
or</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If the Seller, at any
time, gives notice to Selling Agent to terminate the Offering; or</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(c)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>At such time as all of
the Offered Securities shall have been sold and the subscriptions therefor have
been accepted or the Offering Termination Date has been reached, whichever
shall first occur.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Notwithstanding
the termination of this Agreement in accordance with the foregoing provisions
of this Section&nbsp;8, the respective indemnities, covenants, agreements,
representations, warranties and other statements of the Seller and Selling
Agent set forth in or made pursuant to this Agreement will remain operative and
in full force and effect.</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">8.2</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If this Agreement is
terminated pursuant to Section&nbsp;8.1(a) above, the Selling Agent shall have
no liability to the Seller, and if this Agreement is terminated pursuant to
Section&nbsp;8.1(b) above, the Seller shall have no liability to the Selling
Agent.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font><u>Miscellaneous</u>.</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.1</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Except as otherwise
specifically provided in this Agreement or as may be otherwise agreed between
the parties hereto, Selling Agent, on the one hand, and the Seller, on the
other, shall each pay their respective expenses incident to this Agreement and
the transactions contemplated hereby (including, without limitation, the fees
and disbursements of their respective counsel), and no party to the Agreement
shall have any liability for such expenses incurred by any other party.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.2</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>It is understood and
agreed that Selling Agent&#146;s relationship to the Seller is that of an
independent contractor and that nothing herein shall be construed to create a
relationship of partners, affiliates, joint venturers or employer and employee
between Selling Agent or either of them and the Seller.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.3</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>No rights or interests
arising hereunder may be assigned except with the prior written consent of both
the Seller and the Selling Agent.&#160;
Subject to this limitation, this Agreement shall inure to the benefit
and be binding upon Selling Agent and the Seller and their respective
successors and assigns.&#160; This Agreement
is intended to be and is for the sole and exclusive benefit of the parties
hereto, and their respective</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
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</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">successors and assigns and for the benefit of no other
person.&#160; Except as provided in this
Agreement, nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, other than the parties to it and their
respective successors and assigns, any legal or equitable right, remedy or
claim under or with respect to this Agreement or any of its provisions.&#160; No purchaser of Offered Securities shall be
construed as a successor or assign merely by reason of such purchase.</font></p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.4</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>If any portion of this
Agreement shall be held invalid or inoperative, then so far as is reasonable
and possible:</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(a)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>the remainder of this
Agreement shall be considered valid and operative; and</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(b)</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>to the extent possible
under applicable law, effect shall be given to the intent manifest by the
portion held invalid or inoperative.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.5</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>This Agreement may be
executed in a number of identical counterparts and by facsimile, each of which
shall be deemed to be an original, but all of which constitute, collectively,
one and the same Agreement; but, in making proof of this Agreement, it shall
not be necessary to produce or account for more than one counterpart.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.6</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>This Agreement may not
be modified or amended except by written agreement executed by each of the
parties to this Agreement.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.7</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Whenever the context so
requires, the masculine shall include the feminine and neuter, and the singular
shall include the plural, and conversely.&#160;
The words &#147;shall&#148; and &#147;will&#148; and &#147;agrees&#148; are mandatory, &#147;may&#148; is
permissive.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.8</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>The parties to this
Agreement covenant and agree that they will execute any other and further
instruments and documents which reasonably are or may become necessary or convenient
to effectuate and carry out this Agreement.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.9</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>This Agreement (and the
other documents and agreements referenced herein) contains the entire
understanding between the parties and supersedes prior understandings or
written or oral agreements between the parties with respect to the subject
matter of this Agreement.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="font-size:10.0pt;margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.10</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>This Agreement shall be
construed and governed by the laws of the State of Florida.&#160; Any terms and conditions of this Agreement
which are inconsistent with the terms and conditions of the Offering Document,
shall be modified to conform to the terms and conditions set forth in the
Offering Document.</p>

<p style="margin:0in 0in .0001pt;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.11</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>All notices or
communications, except as otherwise specifically provided, shall be in writing,
and, if sent to any party, shall be mailed, delivered or telegraphed and
confirmed to that party at the address set forth below:</p>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='',FILE='C:\jms\eudelhofen\04-6532-1\task133850\6532-1-kc.htm',USER='eudelho',CD='May 28 13:17 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If to the
  Seller:</font></p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><b><font size="2" face="Times New Roman" style="font-size:10.0pt;font-weight:bold;">Vista Medical Technologies, Inc.</font></b></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">2101 Faraday
  Avenue</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Carlsbad,
  CA&nbsp;92008</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attention:
  Chief Financial Officer</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p align="left" style="margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With a copy
  contemporaneously<br>
  by like means:</font></p>
  </td>
  <td width="62%" valign="bottom" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p align="left" style="margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Heller Ehrman
  White &amp; McAuliffe, LLP</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">4350 La
  Jolla Village Dr. 7<sup>th</sup> Floor</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">San Diego,
  CA 92122</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attention:
  Michael S. Kagnoff, Esq.</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p align="left" style="margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If to Selling
  Agent, to:</font></p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p align="left" style="margin:0in 0in .0001pt;text-align:left;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Dawson James
  Securities,</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">A Division
  of Viewtrade Financial</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">6400 NW 6th
  Way</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Suite 310</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Ft.
  Lauderdale, FL 33309</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attention:
  Robert Keyser</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">With a copy
  contemporaneously</font></p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">by like
  means:</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Blank Rome
  LLP</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">1200 North
  Federal Highway, Suite 417</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Boca Raton,
  FL 33432</font></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign="top" style="padding:0in 0in 0in 0in;width:37.26%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="62%" valign="top" style="padding:0in 0in 0in 0in;width:62.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Attention:
  Bruce C. Rosetto, Esq.</font></p>
  </td>
 </tr>
</table>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.12</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>All of the terms of this
Agreement, including all representations, warranties, covenants and agreements
of Selling Agent and the Seller, shall survive completion of the Offering for
three years.</p>

<p align="left" style="margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p align="left" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:left;text-indent:1.0in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">9.13</font><font size="1" style="font-size:8.5pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160; </font>Section titles or
captions contained in this Agreement are inserted only as a matter of
convenience and for reference.&#160; Those
titles in no way define, limit, extend or describe the scope of this Agreement,
or the intent of any provision of this Agreement.</p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

<font size="2" face="Times New Roman" style="font-size:10.0pt;">
<!-- SEQ.=1,FOLIO='',FILE='C:\jms\eudelhofen\04-6532-1\task133850\6532-1-kc.htm',USER='eudelho',CD='May 28 13:17 2004' -->
<br clear="all" style="page-break-before:always;">
</font>

<p align="center" style="font-size:10.0pt;margin:0in 0in .0001pt;text-align:center;">&nbsp;</p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">If the
foregoing correctly sets forth the understanding between us, please indicate
acceptance by signing in the space provided below for that purpose and return
to us a counterpart hereof so signed, whereupon this letter and Selling Agent&#146;s
acceptance shall constitute a binding agreement between us.</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="50%" colspan="4" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Very truly
  yours,</font></p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="50%" colspan="4" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="50%" colspan="4" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="16%" colspan="2" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:16.42%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">Stephen A.
  Gorgol</font></p>
  </td>
  <td width="33%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:33.58%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="50%" colspan="4" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="50%" colspan="4" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.42%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="27%" colspan="2" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:27.12%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ Stephen
  A. Gorgol</font></p>
  </td>
  <td width="18%" valign="top" style="padding:0in 0in 0in 0in;width:18.46%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="50%" valign="top" style="padding:0in 0in 0in 0in;width:50.0%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.42%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="27%" colspan="2" valign="top" style="padding:0in 0in 0in 0in;width:27.12%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Authorized
  Officer)</font></p>
  </td>
  <td width="18%" valign="top" style="padding:0in 0in 0in 0in;width:18.46%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr height="0">
  <td width="361" style="border:none;"></td>
  <td width="32" style="border:none;"></td>
  <td width="87" style="border:none;"></td>
  <td width="109" style="border:none;"></td>
  <td width="133" style="border:none;"></td>
 </tr>
</table>

<p style="margin:0in 0in .0001pt;text-indent:243.0pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<p style="margin:0in 0in .0001pt;text-indent:.5in;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">The foregoing
Selling Agreement for Vista Medical Technologies, Inc. is hereby accepted and
agreed to as of the date first above written.</font></p>

<p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>

<table border="0" cellspacing="0" cellpadding="0" width="100%" style="border-collapse:collapse;width:100.0%;">
 <tr>
  <td width="100%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&#160;DAWSON JAMES SECURITIES,<br>
  A DIVISION OF VIEWTRADE FINANCIAL<br>
  As Selling Agent </font></p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.24%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="29%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:29.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">/s/ Robert
  D. Keyser</font></p>
  </td>
  <td width="66%" valign="top" style="padding:0in 0in 0in 0in;width:66.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.24%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in 0in 0in 0in;width:29.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Authorized
  Officer)</font></p>
  </td>
  <td width="66%" valign="top" style="padding:0in 0in 0in 0in;width:66.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="100%" colspan="3" valign="top" style="padding:0in 0in 0in 0in;width:100.0%;">
  <p style="font-size:10.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.24%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">By:</font></p>
  </td>
  <td width="29%" valign="top" style="border:none;border-bottom:solid windowtext .5pt;padding:0in 0in 0in 0in;width:29.74%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="66%" valign="top" style="padding:0in 0in 0in 0in;width:66.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="4%" valign="top" style="padding:0in 0in 0in 0in;width:4.24%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
  <td width="29%" valign="top" style="padding:0in 0in 0in 0in;width:29.74%;">
  <p style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">(Authorized
  Officer)</font></p>
  </td>
  <td width="66%" valign="top" style="padding:0in 0in 0in 0in;width:66.02%;">
  <p style="font-size:1.0pt;margin:0in 0in .0001pt;">&nbsp;</p>
  </td>
 </tr>
</table>

<p align="center" style="margin:0in 0in .0001pt;text-align:center;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">&nbsp;</font></p>


<div style="margin:0in 0in .0001pt;"><font size="2" face="Times New Roman" style="font-size:10.0pt;">

<hr size="2" width="100%" noshade color="gray" align="left">

</font></div>

</div>


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