S-4

As filed with the Securities and Exchange Commission on November 10, 2005

Registration Statement No. 333-______

______________________________________________________________________________

U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

MARKET CENTRAL, INC.

(Name of Small Business Issuer in its Charter)

Delaware	7372	59-3562953
(State or other Jurisdiction)	(Primary Standard Industrial Classification code Number)	(I.R.S. Employer Identification No.)

(Address and Telephone Number of Principal Executive Offices)

Clifford A. Clark

6701 Carmel Road, Suite 205

Charlotte, NC 28226

(704) 837-0500

(Name, Address, and Telephone Number of Agent for Service)

Copies to:

Gerald L. Baxter, Esq. Greenberg Traurig, LLP 3290 Northside Parkway NW Suite 400 Atlanta, Georgia 30327 (678) 553-2100   Trevor J. Chaplick, Esq. Wilson Sonsini Goodrich & Rosati Professional Corporation 11921 Freedom Drive Suite 600 Reston, VA 20190 (703) 734-3100

Approximate date of proposed sale to the public: As soon as practical after this Registration Statement becomes effective.

If any of the Securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 of the Securities Act of 1933, check the following box.  x

If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering.  o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  o

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box.  o

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount to be Registered		Proposed Maximum Offering Price Per Share (1)		Proposed Maximum Aggregate Offering Price		Amount of Registration Fee
2005 6.4% Senior Convertible Notes (2)		$6,383,950 Principal Amount	$	1.00	$	6,383,950	$	751.39
Warrants to Purchase Common Stock (2)		3,164,788		____		____		____
Common Stock, $.001 Par Value Per Share (2)		339,804
A and B 8% Notes (3)		$5,107,160 New Principal Amount		____		____		____
A and B Warrants to Purchase Common Stock (3)		6,888,098		____		____		____
Common Stock, $.001 Par Value Per Share (4)		5,319,958		____		____		____
Common Stock, $.001 Par Value Per Share (5)		3,164,788	$	1.00	$	3,164,788	$	372.50
Common Stock, $.001 Par Value Per Share (6)		3,723,310	$	.85	$	3,164,814	$	372.50
Common Stock, $.001 Par Value Per Share (7)		3,164,788	$	1.00	$	3,164,788	$	372.50
Total					$	15,878,340	$	1,868.89

(1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) under the Securities Act, as amended.

(2) The fee associated with the registration of the 2005 6.4% Senior Convertible Notes, the Warrants to Purchase Common Stock and the shares of Common Stock issued in the rescission offer is calculated pursuant to Rule 457(j).

(3) Pursuant to Rule 457(i), there is no fee associated with the registration of the A 8% Notes, the B 8% Notes, the A Warrants or the B Warrants to Purchase Common Stock issued in the exchange offer because no additional consideration will be received in connection with the issuance of such Notes and Warrants.

(4) Consists of shares issued or issuable upon conversion of the aggregate of Notes issued in the rescission offer and the exchange offer. Pursuant to Rule 457(i), there is no fee associated with the registration of such shares because no additional consideration will be received in connection with the issuance of such shares. Pursuant to Rule 416(a) under the Securities Act, this Registration Statement shall also cover any additional shares of the Registrant’s Common Stock that become issuable with respect to the shares being registered hereunder by reason of any stock dividend, stock split, recapitalization, or other similar transaction effective without the receipt of consideration that increases the number of the Registrant’s outstanding shares of Common Stock.

(5) Consists of shares issued or issuable upon the exercise of the Warrants to Purchase Common Stock issued in the rescission offer. Pursuant to Rule 416(a) under the Securities Act, this Registration Statement shall also cover any additional shares of the Registrant’s Common Stock that become issuable with respect to the shares being registered hereunder by reason of any stock dividend, stock split, recapitalization, or other similar transaction effective without the receipt of consideration that increases the number of the Registrant’s outstanding shares of Common Stock.

(6) Consists of shares issued or issuable upon the exercise of the A Warrants to Purchase Common Stock issued in the exchange offer. Pursuant to Rule 416(a) under the Securities Act, this Registration Statement shall also cover any additional shares of the Registrant’s Common Stock that become issuable with respect to the shares being registered hereunder by reason of any stock dividend, stock split, recapitalization, or other similar transaction effective without the receipt of consideration that increases the number of the Registrant’s outstanding shares of Common Stock.

(7) Consists of shares issued or issuable upon the exercise of the B Warrants to Purchase Common Stock issued in the exchange offer. Pursuant to Rule 416(a) under the Securities Act, this Registration Statement shall also cover any additional shares of the Registrant’s Common Stock that become issuable with respect to the shares being registered hereunder by reason of any stock dividend, stock split, recapitalization, or other similar transaction effective without the receipt of consideration that increases the number of the Registrant’s outstanding shares of Common Stock.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.

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The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting any offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

Prospectus (Subject to Completion)

Dated November __, 2005

MARKET CENTRAL, INC.

dba SCIENTIGO, INC.

(“Scientigo”)

RESCISSION OFFER

$6,383,950Principal Amount of Scientigo 2005 6.4% Senior Convertible Notes and 4,790,957 Shares of Common Stock issuable upon conversion of such Notes

Warrants to Purchase 3,164,788 Shares of Common Stock and the issuance of up to

3,164,788 Shares of Common Stock issuable upon exercise of such Warrants

339,804 Shares of Common Stock

_________________________________________

EXCHANGE OFFER

Offer to Exchange

Up to $5,107,160 Principal Amount of A and B Scientigo 8% Notes

and

A and B Warrants to Purchase Up to 6,888,098 Shares of Common Stock

For

Any and all outstanding

Scientigo 2005 6.4% Senior Convertible Notes

and

Warrants to Purchase Shares of Common Stock

___________________________________________

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Rescission Offer

We are offering to repurchase all of our outstanding 2005 6.4% Senior Convertible Notes (the “Notes”), Warrants to Purchase Common Stock at $1.00 per share (the “Warrants”) and shares of our Common Stock that were previously issued upon the exercise of Warrants or the conversion of Notes, in the rescission offer (the “Rescission Offer”). The Rescission Offer, which will remain open until __________, 200_, is being made to address possible securities law violations in connection with the original offering of the Notes and Warrants. The Rescission Offer is merely an offer to repurchase the Notes, the Warrants and the shares of our Common Stock issued upon the previous exercise of Warrrants and conversion of Notes. No Note and Warrant holder is required to accept our Rescission Offer. If you accept the Rescission Offer, you will not be able to participate in the exchange offer which is described elsewhere in this prospectus. The principal terms of the Rescission Offer include:

·   Our Rescission Offer is being made to holders of Notes and Warrants who are or were residents of Alabama, California, Colorado, Georgia, Kansas, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia (the “Rescission States”).

·   Generally, if you accept the Rescission Offer, the repurchase price will be equal to the price you paid for the Notes and Warrants plus interest, if any, from the date you purchased the Notes and Warrants through the date that payment is made when the Rescission Offer is consummated, less the interest that you have been paid on the Notes.

·   Federal law does not provide a specific interest rate to be used in the calculation of the repurchase price of your Notes and Warrants if you accept the Rescission Offer. The legal rates of interest for the repurchase of the Notes and Warrants in the Rescission States are as follows:

STATE	INTEREST RATE	STATE	INTEREST RATE
Alabama	6%	New Jersey	3% prior to January 1, 2006; 4% thereafter
California	7%	North Carolina	8%
Colorado	8%	Ohio	none
Georgia	8%	South Carolina	6%
Kansas	6.25% prior to July 1, 2005; 8.25% thereafter	Utah	12%
Maryland	10%	Virginia	6%
Mississippi	6%

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·   You may withdraw your acceptance of the Rescission Offer at any time before the Rescission Offer expires.

·   You may not tender for rescission less than all Notes and Warrants you own.

·   Dispositions of Notes, Warrants or Common Stock pursuant to the Rescission Offer should be taxable transactions for U.S. federal income tax purposes, resulting in the recognition of gains (or possibly dividends) or losses and interest income. The tax consequences of the Rescission Offer, however, are not entirely clear. See "Certain U.S. Federal Income Tax Considerations -Tax Consequences of the Rescission Offer".

·   The Rescission Offer will expire on ___________, 200_ (the “Rescission Expiration Date”).

See “Risk Factors - Risks Related to the Rescission Offer” beginning on page ____ to read about certain factors you should consider before accepting or rejecting the Rescission Offer.

Exchange Offer

For holders who do not intend to accept the Rescission Offer, we are offering to exchange new A 8% Notes and B 8% Notes (the “A Notes” and “B Notes”) and new A Warrants and B Warrants (the “A Warrants” and “B Warrants”) for all of our outstanding Notes and Warrants (the “Exchange Offer”). If you accept the Rescission Offer, you may not participate in the Exchange Offer. The Exchange Offer will commence on the date hereof and will remain open until ________, 2006, the same date as the Rescission Expiration Date, unless we extend the Exchange Offer beyond that date. As of the date of this prospectus, there are $6,383,950 Principal Amount of Notes and Warrants to purchase 3,164,788 shares of our common stock (the “Common Stock”) outstanding. We intend for the Registration Statement on Form S-4 (of which this prospectus is a part) to remain effective until _______ days following the consummation of the Exchange Offer (the “Offering Period”). If you accept the Exchange Offer, you will be able to elect to receive either the A Note or the B Note that have different payment and conversion terms from the Notes, and you will receive A Warrants and B Warrants that have different exercise rights from the Warrants. If you accept the Exchange Offer and elect to receive and convert A Notes and/or exercise your A Warrants during the Offering Period, you will receive freely tradable shares of our Common Stock. The principal terms of the Exchange Offer include the following:

·   If you accept the Rescission Offer, you may not participate in the Exchange Offer.

·   The Exchange Offer will expire at 12:00 midnight, New York City time, on                     , 2006, unless extended.

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·   We will exchange all Notes and Warrants (that are validly tendered and not validly withdrawn) for A Notes or B Notes and A Warrants and B Warrants.

·   In the Exchange Offer, you will receive in exchange for your existing Notes, a choice of either A Notes or B Notes. As summarized in the table below, the Principal Amount of both the A Notes and the B Notes is lowered to the original price of your Notes (the “New Principal Amount”) and the cash interest payments remain at the same level. The A Notes are immediately convertible into shares of Common Stock until the expiration of the Offering Period, at a more favorable conversion rate than the Notes, and are thereafter, no longer convertible. You will receive registered freely tradable shares of Common Stock if you convert your A Notes on or prior to the expiration of the Offering Period. The B Notes are not convertible until 12 months from the consummation of the Exchange Offer, after which they are convertible at a more favorable conversion rate than the Notes until May 31, 2007. However, the Common Stock issuable upon conversion of the B Notes will not be registered and therefore will be restricted and not freely tradable.

·   Regardless of whether you elect to receive A Notes or B Notes, you will receive both A Warrants and B Warrants for your existing Warrants. As summarized in the table below, the A Warrants are immediately exercisable at $.85 per share of Common Stock that will be registered and freely tradable shares; provided if you do not exercise your A Warrants on or before the expiration of the Offering Period, they will expire and no longer be exercisable. The B Warrants are exercisable from the date that is 12 months from the consummation of the Exchange Offer, until June 30, 2010, at $1.00 per share of Common Stock. However, the shares issued upon exercise of the B Warrants will not be registered and therefore will be restricted and not freely tradable. For each A Warrant that you exercise, one B Warrant will terminate.

·   The following table summarizes the differences in the terms of the Notes, the A Notes and the B Notes based upon $1.00 Principal Amount of the Notes being exchanged by the holder:

	Notes	A Notes	B Notes
Principal Amount	$1.00	$.80	$.80
Interest Rate	6.4% per annum paid quarterly	8% per annum paid quarterly	8% per annum paid quarterly
Conversion Rate	$1.3325 per share of Common Stock of Principal Amount	$.96 per share of Common Stock of New Principal Amount	$.96 per share of Common Stock of New Principal Amount
Conversion Period	Ending May 31, 2007	Ending at the expiration of the Offering Period	Beginning 12 months from the consummation of the Exchange Offer, and ending May 31, 2007
Shares of Common Stock Issued Upon Conversion	Registered and freely tradable if converted prior to the expiration of the Offering Period; thereafter, restricted and not freely tradable	Registered and freely tradable	Restricted and not freely tradable

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·   The following table summarizes the differences in the terms of the Warrants, and the A Warrants and B Warrants based upon one (1) Warrant being exchanged by the holder:

	Warrants	A Warrants	B Warrants
Number of Warrants	1.00	1.17648	1.00
Exercise Price	$1.00 per share of Common Stock	$.85 per share of Common Stock	$1.00 per share of Common Stock
Exercise Period	Ending May 31, 2010	Ending at the expiration of the Offering Period	Beginning 12 months from the consummation of the Exchange Offer, and ending May 31, 2010
Termination of Warrants	Not applicable	Not applicable	For each A Warrant exercised by the holder, one B Warrant terminates
Shares of Common Stock Issued Upon Exercise	Registered and freely tradable if exercised prior to the expiration of the Offering Period; thereafter, restricted and not freely tradable	Registered and freely tradable	Restricted and not freely tradable

·   For each A Warrant you exercise, one B Warrant will terminate. If you exercise all of your A Warrants, all of your B Warrants will terminate.

·   The shares of our Common Stock issued upon conversion of the A Notes and exercise of the A Warrants will be registered and freely tradable. The shares of our Common Stock issued upon the conversion of the B Notes and the exercise of the B Warrants will be restricted shares and will not be freely tradable.

·   If you tender your Notes and Warrants, it will be deemed a rejection of the Rescission Offer unless you withdraw your tender of Notes and Warrants prior to the expiration of the Exchange Offer and accept the Rescission Offer prior to the expiration of the Rescission Period.

·   The Exchange Offer is not subject to any conditions other than the proper tender of the Notes and Warrants to the Exchange Agent.

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·   You may not tender for exchange less than all Notes and Warrants that you own.

·   You may withdraw tenders of Notes and Warrants at any time before the Exchange Offer expires.

·   Exchanges of Notes for A or B Notes are taxable transactions for U.S. federal income tax purposes, although it is anticipated that losses rather than gains generally will be recognized. Exchanges of Warrants for A Warrants and B Warrants should not be taxable transactions, although it is possible that income or gain would be recognized. See "Certain U.S. Federal Income Tax Considerations -Tax Consequences of the Exchange Offer.”

·   We will not receive any proceeds from the Exchange Offer. However, to the extent that warrants are exercised, we will receive proceeds from the issuance of shares of Common Stock upon such exercises. We expect to utilize the proceeds from the exercise of warrants for our continuing efforts to license, sell or otherwise transfer our intellectual property, for general working capital, and potentially for other strategic purposes such as acquisitions of complementary businesses or technologies.

·   Our Chairman of the Board of Directors, a limited partnership (of which our is a member of the limited liability company which is the general partner), and our Chief Operations Officer, hold an aggregate of $1,018,750 Principal Amount of Notes and 509,375 Warrants, and are eligible to participate in the Rescission Offer. We have been advised that they do not intend to accept the Rescission Offer. We have also been advised that they intend to accept the Exchange Offer. See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer,”“ - Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Notes and the Warrants” and “Rescission Offer - Directors, Officers and Major Stockholders.”

·   No public market exists for the Notes or Warrants, nor will any public market exist for the A Notes, B Notes, A Warrants or B Warrants. We do not intend to apply for listing of any of such notes or warrants on any securities exchange or to arrange for them to be quoted in any quotation system. Our shares of Common Stock are traded on the Over-The-Counter Bulletin Board (“OTC Bulletin Board”) under the symbol MKTE.OB.

We are Not Asking You for a Proxy and You are Requested Not To Send Us a Proxy.

See “Risk Factors - Risks Related to the Exchange Offer” beginning on page __ of this prospectus for a description of the risks you should consider before exchanging your Notes and Warrants.

_____________________________________________

No underwriter or person has been engaged with respect to the Rescission Offer or the Exchange Offer. This offering will terminate ________ days from the consummation of the Exchange Offer.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The date of this prospectus is _______________, 2005.

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TABLE OF CONTENTS

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS	10
PROSPECTUS SUMMARY	11
SUMMARY CONSOLIDATED FINANCIAL STATEMENTS	32
RISK FACTORS	33
RESCISSION OFFER	40
THE EXCHANGE OFFER	51
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS	64
LEGAL PROCEEDINGS	73
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT	73
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	73
DESCRIPTION OF SECURITIES	73
INTERESTS OF NAMED EXPERTS AND COUNSEL	77
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT LIABILITIES	77
DESCRIPTION OF BUSINESS	77
MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION	77
DESCRIPTION OF PROPERTY	78
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	78
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS	78
EXECUTIVE COMPENSATION	78
USE OF PROCEEDS	78
PLAN OF DISTRIBUTION	78
LEGAL MATTERS	79
AVAILABLE INFORMATION	79
FINANCIAL STATEMENTS	80
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS AND FINANCIAL DISCLOSURE	80

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______________________________________________________________________________

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

 We believe that it is important to communicate our future expectations to our security holders and to the public. This prospectus, therefore, contains statements about future events and expectations which are "forward-looking statements" including the statements about our plans, objectives, expectations and prospects under the headings "Business" and "Management's Discussion and Analysis or Plan of Operation." You can expect to identify these statements by forward-looking words such as "may," "might," "could," "would," "anticipate," "believe," "plan," "estimate," "project," "expect," "intend," "seek" and other similar expressions. Any statement contained in this prospectus that is not a statement of historical fact may be deemed to be a forward-looking statement. Although we believe that the plans, objectives, expectations and prospects reflected in or suggested by our forward-looking statements are reasonable, those statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements, and we can give no assurance that our plans, objectives, expectations and prospects will be achieved.

Important factors that might cause our actual results to differ materially from the results contemplated by the forward-looking statements are contained in the "Risk Factors" and "Management's Discussion and Analysis or Plan of Operation" sections of this prospectus as well as elsewhere in this prospectus and/or our future filings with the Securities and Exchange Commission (the “Commission”), and include, among others, the following:

·   Our ability to successfully license, sell or otherwise transfer for value our intelligent Business Process Automation technologies including the licensing of intellectual property to partners whose products and services complement our technologies for the benefit of clients;

·   Our ability to raise sufficient capital to carry out our strategic business plan;

·   Increased competition in our markets;

·   The greater financial resources of competitors;

·   Anticipated future losses;

·   Our debt level;

·   Our ability to manage anticipated growth and rapid expansion;

·   Changes or advances in technology;

·   General economic and business conditions; and

·   Other factors and risks discussed herein and in our other filings with the Commission.

We assume no obligation to publicly update or revise any forward-looking statements made in this prospectus, whether as a result of new information, future events, changes in assumptions or otherwise, after the date of this prospectus. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements.

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PROSPECTUS SUMMARY

This summary provides an overview of certain information contained elsewhere in this prospectus and does not contain all of the information that you should consider or that may be important to you. You should read the entire prospectus carefully to fully understand the Rescission Offer and the Exchange Offer, including “Risk Factors” and the financial statements beginning on pages __ and __.

Scientigo

We are a knowledge management company specializing in solutions that are designed to enable businesses to efficiently store, categorize and retrieve information with state of the art speed and precision. We believe our products are advanced in the market in the areas of information capture, storage and retrieval. We have numerous elemental patents issued and pending in the field of Enterprise Content Management with a revolutionary artificial intelligence we call Business Process Automation.

In addition to these elemental patents, we own patents and patent-pending technologies that together comprise a suite of solutions that include software for next-generation search, intelligent document recognition, data capture, cleansing, mining, and integration. We have two subsidiaries, Convey Systems International, Inc. and Tigo Search, Inc. Each of these subsidiaries is effectively inactive.

Our principal executive offices are located at 6701 Carmel Road, Suite 205, Charlotte, NC 28226. Our telephone number is (704) 837-0500.

Recent Developments

·   In August and September 2005, Thomas Gordy and James McGovern resigned as members of our Board of Directors, respectively;

·   In September 2005, Stuart J. Yarbrough was elected a member of our Board of Directors and Chairman of the Board;

·   In September 2005, Cynthia S. White was elected our Chief Operations Officer;

·   In September 2005, Scientigo entered into a Software Distribution Agreement with Ribstone Systems, Inc. for the distribution of Scientigo’s patented search, automated coding and indexing applications which will be integrated with Ribstone’s Canon Compatible (TM) document scanning and processing engine. Ribstone products are used in conjunction with most Canon imageRUNNER multifunction office copiers and may be purchased through the Canon USA reseller channel;

·   In May 2005, we completed the sale of the assets of our call center operations. In August 2005, we completed the sale of the subsidiary, ECOM Support Centers, Inc, that previously owned the assets of our call center operations;

·   In September 2005, we completed a private placement of $6,633,950 Principal Amount of our 2005 6.4% Senior Convertible Notes (the “Notes”) and 3,316,975 warrants to purchase our Common Stock at $1.00 per share (the “Warrants”) which are the subject of the Rescission Offer and the Exchange Offer; and

·   In August 2005, we completed an exchange offer whereby all holders of our Series A Preferred Stock elected to exchange their Preferred Stock for 5,923,335 shares of Common Stock and 5,923,335 warrants to purchase our Common Stock at $.85 per share. Subsequently, warrants have been exercised for 872,192 shares .

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The Rescission Offer

The following is a summary of the principal terms of the Rescission Offer. A more detailed description is contained in this prospectus under the section entitled “Rescission Offer.” As of the date of this prospectus, there is outstanding and eligible for participation in the Rescission Offer $6,383,950 aggregate Principal Amount of our 2005 6.4% Senior Convertible Notes, Warrants to purchase 3,164,788 shares of our Common Stock at $1.00 per share, and 339,804 shares of our Common Stock that were issued pursuant to the exercise of Warrants and the conversion of Notes.

The Rescission Offer	We are offering to repurchase $6,383,950 Principal Amount of our 2005 6.4% Senior Convertible Notes, Warrants to purchase 3,164,788 shares of our Common Stock and 339,804 shares of Common Stock from the prior exercise of Warrants and conversion of Notes. The repurchase price for the Notes, Warrants and shares of our Common Stock issued upon conversion of Notes subject to the Rescission Offer is equal to the price paid by those persons who purchased those Notes and Warrants plus any applicable interest. The interest paid by us to date on the Notes will be deducted from the repurchase price (unless you resided in Ohio when you purchased the Notes and Warrants). The repurchase price of the shares of Common Stock issued upon the exercise of Warrants subject to the Rescission Offer is equal to the $1.00 exercise price per share that you paid upon exercise of the Warrants plus any applicable interest.
Procedure for Accepting the Rescission Offer	You must complete and sign the enclosed election form and stock power indicating the Notes, Warrants and Common Stock, if any, to be repurchased by us and deliver the original Notes, Warrants and Common Stock share certificates, if any, that you are surrendering for repurchase prior to the Rescission Offer expiration date.
Expiration Date	The Rescission Offer will expire at 5:00 p.m., New York City time, on ______, 200_.
Withdrawal	You may withdraw your acceptance of the Rescission Offer at any time prior to 5:00 p.m., New York City time, on _______, 200_.
Conditions to the Rescission Offer	None.
Effect of Rejection or Failure to Accept the Rescission Offer	If you reject or fail to accept the Rescission Offer, you will retain ownership of the Notes, Warrants and shares of Common Stock, if any, with the same terms as when those securities were originally issued. You will not receive any cash for those securities in connection with the Rescission Offer.
Effect of Tendering Your Notes and Warrants in the Exchange Offer	If you tender your Notes and Warrants pursuant to the Exchange Offer, it will be deemed a rejection of the Rescission Offer unless you thereafter withdraw your tender of Notes and Warrants prior to the expiration of the Exchange Offer and accept the Rescission Offer prior to the Rescission Expiration Date. The Rescission Offer and the Exchange Offer expire on the same date, unless the Exchange Offer is extended.

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Effect of the Acceptance of the Rescission Offer	If you accept the Rescission Offer, you will not have any continuing interest or title in the Notes, Warrants or shares of our Common Stock previously issued to you, if any, upon the exercise of Warrants or conversion of Notes, that you will be surrendering upon the closing of the Rescission Offer, and you will only be entitled to receive the proceeds from our repurchase of such securities. Additionally, if you accept the Rescission Offer, you will give up the following rights: (1) the right to participate in the Exchange Offer described elsewhere in this prospectus, (2) the right to receive quarterly interest on the Notes at a cash annual rate of 8% including any interest that may have accrued but has not been paid at the time the Rescission Offer is consummated, (3) the right to receive the Principal Amount of the Notes on May 31, 2007, if you do not convert your Notes into our Common Stock prior to such date, (4) the right to convert your Notes into shares of our Common Stock in accordance with the terms of the Notes, and (5) the right to receive shares of our Common Stock upon exercise of the Warrants.
Use of Proceeds	We will not receive any proceeds from the Rescission Offer.
U.S. Federal Tax Consequences	Dispositions of Notes, Warrants or Common Stock pursuant to the Rescission Offer should be taxable transactions for U.S. federal income tax purposes, resulting in the recognition of gains (or possibly dividends) or losses and interest income. The tax consequences of the Rescission Offer, however, are not entirely clear. See "Certain U.S. Federal Income Tax Considerations -Tax Consequences of the Rescission Offer."
OTCBB Symbol	Our Common Stock is traded on the Over-the-Counter Bulletin Board under the symbol “MKTE.OB.”

The Exchange Offer

The following is a summary of the principal terms of the Exchange Offer. A more detailed description is contained in this prospectus under the section entitled “The Exchange Offer.” As of the date of this prospectus, there is outstanding and eligible to participate in the Exchange Offer $6,383,950 aggregate Principal Amount of our 2005 6.4% Senior Convertible Notes (the “Notes”) and Warrants to purchase 3,164,788 shares of our Common Stock at $1.00 per share (the “Warrants”).

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The Exchange Offer	We are offering to exchange all Notes and Warrants (that are validly tendered and not validly withdrawn) for new notes and new warrants.
A Notes and B Notes	If you accept the Exchange Offer, you will be entitled to elect to receive either an A Note or a B Note. The quarterly interest payment and security for repayment for the Notes, the A Notes and the B Notes are the same. The principal amount and conversion rates for the Notes, A Notes and B Notes are different.
Difference in Principal Amount of Notes, A Notes and B Notes	The original purchase price for the Notes was 80% of the Principal Amount of the Notes. Because of adverse income tax consequences that would occur upon acceptance of the Exchange Offer to the Note holders if the A Notes and the B Notes had the same Principal Amounts as the Notes, the A Notes and the B Notes offered in exchange for the Notes have a principal amount equal to the original purchase price paid by Note holders (the “New Principal Amount”). If a Note holder accepted the Exchange Offer and did not convert his A Notes or B Notes into shares of our Common Stock prior to maturity, he would be entitled to receive at maturity a principal payment equal to his 80% discounted New Principal Amount. If a Note holder does not accept the Exchange Offer and does not convert his Notes into shares of our Common Stock prior to maturity, he would be entitled to receive at maturity the original 100% Principal Amount of his Note.
Differences in Conversion Terms of Notes, A Notes and B Notes	The Notes are convertible into shares of our Common Stock at a conversion rate of one share of Common Stock for each $1.3325 Principal Amount of Notes surrendered for conversion for a term ending May 31, 2007. The A Notes are convertible into shares of our Common Stock at a conversion rate of one share of Common Stock for each $.96 New Principal Amount of A Notes surrendered for conversion on or before the expiration of the Offering Period. Thereafter, the A Notes are no longer convertible into shares of our Common Stock. Beginning 12 months from the consummation of the Exchange Offer, the B Notes are convertible into shares of our Common Stock at a conversion rate of one share of Common Stock for each $.96 New Principal Amount of B Notes surrendered for conversion on or before May 31, 2007. The B Notes are prepayable by us only during the period that the B Notes are convertible into shares of our Common Stock without the prior consent of the holder of the B Notes. Other than the differences described above, the terms of the Notes, the A Notes and the B Notes are the same.

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A Warrants and B Warrants	If you accept the Exchange Offer, you will receive 1.17648 A Warrants and one (1) B Warrant for each Warrant tendered for exchange.
Differences in Terms of Warrants, A Warrants and B Warrants	The Warrants are exercisable at $1.00 per share of Common Stock for a term ending June 30, 2010. The A Warrants are exercisable at $.85 per share of our Common Stock for a term beginning on the date of issuance and ending at the expiration of the Offering Period at which point the A Warrants terminate and are no longer exercisable. Beginning 12 months from consummation of the Exchange Offer, the B Warrants are exercisable at $1.00 per share of our Common Stock for a term ending June 30, 2010. For each A Warrant you exercise, one B Warrant will terminate. If all A Warrants are exercised, all B Warrants will terminate.
Procedure for Accepting the Exchange Offer	To tender your Notes and Warrants, prior to 12:00 Midnight, New York City time, on ____________, 2006, unless the Exchange Offer is extended, you or your nominee must deliver your instruments evidencing the Notes and Warrants and a properly completed and duly executed Letter of Transmittal to Greenberg Traurig, LLP, the Exchange Agent, at the address appearing in the Letter of Transmittal.

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Expiration Date	The Exchange Offer will expire at 12:00 midnight, New York City time, on ______, 2006, unless extended.
Withdrawal	You may withdraw your acceptance of the Exchange Offer at any time prior to 12:00 midnight, New York City time, on _______, 2006.
Conditions to the Exchange Offer	If you accept the Rescission Offer, you may not participate in the Exchange Offer. Otherwise, there are no conditions to the Exchange Offer other than the proper tender of all of your Notes and Warrants to the Exchange Agent.
Rejection or Failure to Accept Exchange Offer	If you reject or fail to accept the Exchange Offer, you will retain your ownership of the Notes and Warrants with the same terms as when those securities were initially issued.
Use of Proceeds	We will not receive any proceeds from the Exchange Offer. We will, however, receive proceeds from the issuance of Common Stock to the extent the A Warrants and/or B Warrants are exercised. Such proceeds, if any, will be used for working capital and for potential strategic acquisitions.
Fees	There are no fees or commission paid with respect to the Exchange Offer. However, we have agreed to pay fees to Jones Byrd & Attkisson, Inc. (the “Placement Agent”), if allowed by applicable state law, in the event that you accept the Exchange Offer and after issuance of the A Notes, B Notes, and A Warrants and B Warrants, elect to convert your A Notes or B Notes into shares of our Common Stock (in the amount of 6% of the New Principal Amount of such notes converted), or to exercise your A Warrants or B Warrants (in an amount equal to 10% of the aggregate exercise price of such warrants exercised).
U.S. Federal Tax Consequences	Exchanges of Notes for A or B Notes are taxable transactions for U.S. federal income tax purposes, although it is anticipated that losses rather than gains generally will be recognized. Exchanges of Warrants for A Warrants and B Warrants should not be taxable transactions, although it is possible that income or gain would be recognized. See "Certain U.S. Federal Income Tax Considerations - Tax Consequences of the Exchange Offer."
Accounting Treatment	The A Notes and B Notes and A Warrants and B Warrants may be recorded at a different carrying value than the Notes and Warrants on the date of the exchange. We will value the beneficial conversion feature of the A Notes and B Notes and the value attributable to the A Warrants and the B Warrants on the date of exchange.
OTCBB Symbol	Our Common Stock is traded on the OTC Bulletin Board under the symbol “MKTE.OB.”

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Questions and Answers About the Rescission Offer

We are offering to repurchase all of our outstanding Notes and Warrants in the Rescission Offer. The Rescission Offer, which will remain open until __________, 200_, is being made to address possible securities law compliance issues in connection with the original offering of the Notes and Warrants. The Rescission Offer is merely an offer to repurchase the Notes, Warrants and shares of Common Stock issued upon the previous conversion of Notes and exercise of Warrants. No Note and Warrant holder is required to accept our Rescission Offer. If you accept the Rescission Offer, you will not be able to participate in the Exchange Offer which is described elsewhere in this prospectus.

You should read the following questions and answers, together with the more detailed information regarding the Rescission Offer and the risk factors set forth elsewhere in this prospectus, before deciding whether to accept or reject the Rescission Offer.

Q:    Why are we making the Rescission Offer?

A:   The offer and sale of the Notes and Warrants that we issued to investors from May 2005 to September 2005 may not have been exempt from the registration requirements under the Securities Act of 1933 or from the registration or qualification requirements under the securities laws of certain states. Consequently, the issuance of the Notes and Warrants may not have complied with the Securities Act of 1933 and the state securities laws of the states of Alabama, Georgia, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia. Our Board of Directors has determined to conduct this Rescission Offer to address these securities laws compliance issues by allowing all holders of the Notes and Warrants to rescind the purchase of such securities and sell those securities back to us if they so desire.

Q:    Which securities are included in the Rescission Offer?

A:    We are offering, upon the terms and conditions described in this prospectus, to rescind the sale of all Notes and Warrants outstanding constituting $6,383,950 Principal Amount of Notes and Warrants to purchase 3,164,788 shares of our Common Stock, and 339,804 shares of our Common Stock that have issued previously upon the exercise of Warrants and the conversion of Notes. The Notes are held by 98 investors, the Warrants are held by 96 investors, and such shares of Common Stock are held by four (4) investors.

Q:    When does the Rescission Offer expire?

A:    Our Rescission Offer will expire at 5:00 pm New York City time on __________, 200_ (the “Rescission Expiration Date”).

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Q:    What will I receive if I accept the Rescission Offer?

A:    If you accept our Rescission Offer with respect to the Notes and Warrants you purchased prior to the Rescission Expiration Date, we will repurchase such Notes and Warrants at the price you paid, plus interest at the current statutory rate per year, if any, from the date of purchase through the date of payment pursuant to the Rescission Offer. In all states other than Ohio, the interest previously paid to you on the Notes is deducted from the total amount you would be entitled to receive if you accept the Rescission Offer (in Ohio, such previously paid interest is not deducted from the repurchase price under applicable Ohio securities laws). If you accept our Rescission Offer and have exercised your Warrants, we will also repurchase the shares of Common Stock you received upon such exercise at $1.00 per share, the price you paid for the shares of Common Stock, plus interest at the current statutory rate per year, if any, from the date of exercise through the date of payment pursuant to the Rescission Offer. If you accept our Rescission Offer and you hold shares of Common Stock that were issued upon the conversion of your Notes, we will repurchase such shares of Common Stock at the price you paid for your Notes and Warrants, plus interest at the current statutory rate per year mandated by your state of residence, if any, from the date of issuance of the Notes and Warrants through the date of payment pursuant to the Rescission Offer, less any interest paid to you pursuant to the terms of the Notes. The legal rates of interest for the repurchase of Note, Warrants and shares will be based on the state of residence of the Note and Warrant holder. These interest rates are as follows:

STATE OF RESIDENCE	INTEREST RATE
Alabama	6%
California	7%
Colorado	8%
Georgia	8%
Kansas	6.25% prior to July 1, 2005; 8.25% thereafter
Maryland	10%
Mississippi	6%
New Jersey	3% prior to January 1, 2006; 4% thereafter
North Carolina	8%
Ohio	none
South Carolina	6%
Utah	12%
Virginia	6%

Q: If I accept the Rescission Offer, when will I receive my payment?

A: On or before the fifth (5^th) day after the Rescission Expiration Date.

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Q:    Can you give me some examples of what I will receive if I accept the Rescission Offer?

A:    In all Rescission States (other than Ohio, where you would receive a return of your original investment without interest), we will repurchase the Notes and Warrants at the price you paid, plus interest at the current statutory rate per year, from the date of purchase through the date of payment pursuant to the Rescission Offer, less any interest already paid on the Notes. If you are a resident of Georgia, for example, and purchased $100,000 Principal Amount of Notes and 50,000 Warrants on June 1, 2005, and you accept our Rescission Offer, you would receive:

• The original purchase price (reflecting the original issue discount) = $80,000.

• Plus simple interest at 8 % per year, as required by Georgia law = $___.

• Less interest already paid in accordance with the terms of the Note = $___

• For a total of $______.

If you are a resident of South Carolina, for example, and purchased $100,000 Principal Amount of Notes and 50,000 Warrants on June 1, 2005, and you accept our Rescission Offer, you would receive:

• The original purchase price (reflecting the original issue discount) = $80,000.

• Plus simple interest at 6 % per year, as required by South Carolina law = $___.

• Less interest already paid in accordance with the terms of the Note = $___

• For a total of $______.

Q: If I accept the Rescission Offer, will I have any continuing rights in the Notes, Warrants or, if I have exercised my Warrants or converted my Notes, the shares of Common Stock issued upon such exercise or conversion?

A: No. If you accept the Rescission Offer, you will give up the following rights: (1) the right to participate in the Exchange Offer described elsewhere in this prospectus, (2) the right to receive quarterly interest on the Notes at a cash annual rate of 8% including any interest that may have accrued but has not been paid at the time the Rescission Offer is consummated, (3) the right to receive the Principal Amount of the Notes on May 31, 2007, if you do not convert your Notes to our Common Stock prior to such date, (4) the right to convert your Notes into shares of our Common Stock in accordance with the terms of the Notes, and (5) the right to receive shares of our Common Stock upon exercise of the Warrants. To the extent that you have already been issued shares of Common Stock upon exercise of your Warrants or conversion of your Notes, you will be required to tender those shares to Scientigo and will have no further rights as a stockholder with respect to those shares.

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Q: If I accept the Rescission Offer, will I be able to participate in the Exchange Offer described elsewhere in this prospectus?

A: No.

Q: If I accept the Exchange Offer, what effect will it have on my ability to accept the Rescission Offer?

A: If you tender your Notes and Warrants pursuant to the Exchange Offer, it will be deemed a rejection of the Rescission Offer unless you thereafter withdraw your tender of Notes and Warrants prior to the expiration of the Exchange Offer and accept the Rescission Offer prior to the Rescission Expiration Date.

Q:If I do not accept the Rescission Offer prior to the Rescission Expiration Date, but have not yet accepted the Exchange Offer, can I still tender my Notes and Warrants in the Exchange Offer?

A:No. The Rescission Offer and the Exchange Offer both expire on _______, 2006, unless the Exchange Offer is extended.

Q: Have any officers, directors or 5% stockholders advised us whether they will participate in the Rescission Offer?

A: Our Chairman of the Board of Directors, a limited partnership (of which our Chairman is a member of the limited liability company which is the general partner), and our Chief Operations Officer, who hold an aggregate of $1,018,750 Principal Amount of Notes and 509,375 Warrants, are eligible to participate in the Rescission Offer. We have been advised that they do not intend to accept the Rescission Offer. We have also been advised that they intend to accept the Exchange Offer. See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer,”“ - Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Notes and the Warrants” and “Rescission Offer - Directors, Officers and Major Stockholders.”

Q: If I do not accept the Rescission Offer, can I sell my Notes or Warrants?

A: Yes. Upon the completion of the Rescission Offer, the Notes and Warrants will be freely tradable under federal securities laws. However, there is not expected to be any established trading market for them.

Q: If I do not accept the Rescission Offer, can I sell any shares of Common Stock that are issued to me upon the conversion of Notes and exercise of Warrants?

A: The shares of Common Stock issuable upon the conversion of Notes and the exercise of Warrants will be registered and will be freely tradeable. However, such conversion and/or exercise must occur when the registration statement of which this prospectus is a part is effective. We intend to maintain such effectiveness until the expiration of the Offering Period, which is _____ days following the consummation of the Exchange Offer.

Q:    What do I need to do now to accept or reject the Rescission Offer?

A:    To accept or reject the Rescission Offer, you must complete and sign the accompanying election form and return it in the enclosed return envelope to Scientigo, to the attention of Clifford A. Clark, Secretary, 6701 Carmel Road, Suite 205, Charlotte, NC 28226, as soon as practical but in no event later than 5:00 pm New York City time on ____ __, 200_, the Rescission Expiration Date. If you are accepting the Rescission Offer, please also include in your return envelope the original Notes and Warrants that you purchased and a completed election form and stock power (see Appendix A) . If you are accepting the Rescission Offer and you exercised Warrants or converted Notes, please also include the certificate representing the shares of Common Stock issued to you upon such exercise or conversion.

If you do not want to accept the Rescission Offer and you want to accept our Exchange Offer, the tender of your Notes and Warrants to the Exchange Agent for the Exchange Offer will be deemed a rejection of the Rescission Offer (unless you thereafter withdraw your tender of Notes and Warrants prior to the expiration of the Exchange Offer and accept the Rescission Offer prior to the Rescission Expiration Date).

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Q:    Can I accept the Rescission Offer in part?

A:    No.

Q:    What happens if I do not return my Rescission Offer election form?

A:    If you do not return a properly completed election form before the Rescission Expiration Date, you will be deemed to have rejected our offer.

Q:    What remedies or rights do I have now that I will not have after the Rescission Offer?

A:    It is unclear whether or not you will have a right of rescission under federal securities laws after the Rescission Offer. The staff of the Securities and Exchange Commission is of the opinion that a person’s right of rescission created under the Securities Act may survive the Rescission Offer. However, the federal courts in the past have ruled that a person who rejects or fails to accept a rescission offer is precluded from later seeking similar relief. Generally, the federal statute of limitations for noncompliance with the requirement to register securities under the Securities Act is one year from the date of the violation upon which the action to enforce liability is based.

The state remedies and statutes of limitations vary and depend upon the state in which you purchased your Notes and Warrants. The following is a summary of the applicable remedies and statutes of limitations for the states in which the Notes and Warrants covered by this Rescission Offer were sold. If you do not accept our Rescission Offer, you will no longer have any right of rescission under any of such states’ laws after the expiration of our Rescission Offer. This summary is not complete. For a more detailed description of the various state laws governing rescission rights in the respective states, see “Rescission Offer—Effect of Rescission Offer.”

STATE OF RESIDENCE

APPLICABLE REMEDY AND STATUTE OF LIMITATIONS

Alabama

Under Alabama law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Alabama Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Alabama. In the event of such violation, the purchaser may sue to recover the consideration paid for such securities with interest at 6% per year from the date of payment, court costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary of the date of sale. Regardless, you will no longer have any right of rescission under Alabama law after the expiration of our Rescission Offer.

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STATE OF RESIDENCE	APPLICABLE REMEDY AND STATUTE OF LIMITATIONS
Georgia	Under Georgia law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Georgia Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Georgia. In the event of such violation, the purchaser may sue to recover the consideration paid for such securities with interest at a rate equal to the rate stated in interest-bearing securities from the date of payment (in this case, an effective rate of 8% per annum), taxable court costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary of the date contract of sale, or sale if there is no contract of sale. Regardless, you will no longer have any right of rescission under Georgia law after the expiration of our Rescission Offer.
Maryland	Under Maryland law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Maryland Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Maryland. In the event of such violation, the purchaser may sue either at law or in equity to recover the consideration paid for such securities, together with interest at the rate of 10% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for damages if the purchaser no longer owns the securities, at any time prior to the one year anniversary of the noncompliance with the registration or qualification requirements. Regardless, you will no longer have any right of rescission under Maryland law after the expiration of our Rescission Offer.
Mississippi	Under Mississippi law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Mississippi Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Mississippi. In the event of such violation, the purchaser may sue to recover the consideration paid for such securities with interest at 8% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for actual damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary of the date of sale. Regardless, you will no longer have any right of rescission under Mississippi law after the expiration of our Rescission Offer.
New Jersey	Under New Jersey law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the New Jersey Uniform Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in New Jersey. In the event of such violation, the purchaser may sue at law or in equity to recover the consideration paid for such securities with interest at 3% per year from the date of payment through December 31, 2005, and 4% thereafter and costs, less the amount of any income received on the securities, or for actual damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary of the contract of sale. Regardless, you will no longer have any right of rescission under New Jersey law after the expiration of our Rescission Offer.
North Carolina	Under North Carolina law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the North Carolina Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in North Carolina. In the event of such violation, the purchaser may sue either at law or in equity to recover the consideration paid for such securities with interest at 8% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for actual damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary of the date of sale. Regardless, you will no longer have any right of rescission under North Carolina law after the expiration of our Rescission Offer.
Ohio	Under Ohio law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Ohio Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Ohio. In the event of such violation, the purchaser may sue to recover the full amount paid for such securities and all taxable court costs, unless the court determines the violation did not materially affect the protection contemplated by the violated provision of the Ohio Securities Act. The action may not be brought more than two years after the investor knew or had reason to know of the facts by reason of which the actions of the issuer were unlawful, or more than five years from the date of such sale, whichever is the shorter period. Regardless, you will no longer have any right of rescission under Ohio law after the expiration of our Rescission Offer.
South Carolina	Under South Carolina law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the South Carolina Uniform Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in South Carolina. In the event of such violation, the purchaser may sue either at law or in equity to recover the consideration paid for such securities with interest at 6% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for actual damages if the purchaser no longer owns the securities, at any time prior to the three year anniversary of the contract of sale. Regardless, you will no longer have any right of rescission under South Carolina law after the expiration of our Rescission Offer.
Utah	Under Utah law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Utah Uniform Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Utah. In the event of such violation, the purchaser may sue either at law or in equity to recover the consideration paid for such securities with interest at 12% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for actual damages if the purchaser no longer owns the securities, at any time prior to the four year anniversary of the date of sale or prior to two years after the discovery by the purchaser of the facts constituting the violation, which ever occurs first. Under Utah law, the purchaser may be entitled to recover an amount equal to three times the amount otherwise recoverable as described above upon a showing that the violation was reckless or intentional. Scientigo does not believe that the possible violation was either reckless or intentional. Regardless, you will no longer have any right of rescission under Utah law after the expiration of our Rescission Offer.
Virginia	Under Virginia law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Virginia Securities Act. Because we may not have complied with the requirements of Regulation D, we may not have had an exemption from such registration requirements in Virginia. In the event of such violation, the purchaser may sue to recover the consideration paid for such securities with interest at 6% per year from the date of payment and costs, less the amount of any income received on the securities, or for actual damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary of the sale. Regardless, you will no longer have any right of rescission under Virginia law after the expiration of our Rescission Offer.

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We believe that your acceptance of the Rescission Offer will preclude you from later seeking similar relief. Regardless of whether you accept the Rescission Offer, we believe that any remedies you may have after the Rescission Offer expires would not be greater than any amount you would receive in the Rescission Offer.

Q:    How will the Rescission Offer be funded?

A:    The Rescission Offer will be funded from our existing cash balances to the extent available. If the holders of all or a significant portion of the Notes and Warrants accept our offer, our cash resources are insufficient to repurchase all of such Notes, Warrants and/or Common Stock issued upon the exercise of such Warrants or conversion of Notes. In such event, we may have to seek additional capital sources or not consummate some portion of the Rescission Offer acceptances, if any.See “Risk Factors - Rescission Offer.”

Q:    Can I change my mind after I have mailed my signed Rescission Offer election form?

A:    Yes. You can change your decision about accepting or rejecting our Rescission Offer at any time before the Rescission Expiration Date. You can do this by completing and submitting a new election form. Any new election forms must be received by us prior to the Rescission Expiration Date in order to be valid. We will not accept any election forms after the expiration date.

Q: What are the likely tax consequences to me if I accept the Rescission Offer?

A: Dispositions of Notes, Warrants or Common Stock pursuant to the Rescission Offer should be taxable transactions for U.S. federal income tax purposes, resulting in the recognition of gains (or possibly dividends) or losses and interest income. The tax consequences of the Rescission Offer, however, are not entirely clear. See "Certain U.S. Federal Income Tax Considerations -Tax Consequences of the Rescission Offer."

Q:    Who can help answer my questions?

A:    You can call Clifford A. Clark, our Secretary, at (704) 837-0500 with questions about the Rescission Offer.

Q:    Where can I get more information about Scientigo?

A:    You can obtain more information about Scientigo from the filings we make from time to time with the Securities and Exchange Commission. These filings are available on the Securities and Exchange Commission’s website at www.sec.gov. Our filings are made under our legal name “Market Central, Inc.”

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Questions and Answers About the Exchange Offer

We are offering to exchange new notes and new warrants for all of our outstanding Notes and Warrants held by holders who do not accept our Rescission Offer (the “Exchange Offer”). If you accept the Rescission Offer, you may not participate in the Exchange Offer. The Exchange Offer commences on the date hereof and will remain open until ________, 2006, unless extended. As of the date of this prospectus, there are $6,383,950 Principal Amount of Notes and Warrants to purchase 3,164,788 shares of our Common Stock outstanding. The Registration Statement on Form S-4 (of which this prospectus is a part) will remain effective until _____ days following the consummation of the Exchange Offer  (the “Offering Period”). If you accept the Exchange Offer, you will be able to elect to receive one of two new notes, A Notes or B Notes, that have the same cash interest payment terms to the Notes but different principal amounts and conversion rights, and you will receive two new warrants, A Warrants and B Warrants, that have different exercise rights. If you accept the Exchange Offer and elect to receive and convert A Notes and/or exercise your A Warrants during the Offering Period, you will receive registered freely tradable shares of our Common Stock.

You should read the following questions and answers, together with the more detailed information regarding the Exchange Offer and the risk factors set forth elsewhere in this prospectus, before deciding whether to accept the Exchange Offer.

Q:If I accept the Rescission Offer, will I be able to participate in the Exchange Offer?

A:No. If you accept the Rescission Offer, you will have no further rights in the Notes, Warrants or shares of Common Stock issued upon the exercise of Warrants or conversion of Notes, other than the rights afforded to you in the Rescission Offer. See “Rescission Offer.”

Q: If I accept the Exchange Offer, what effect will it have on my ability to accept the Rescission Offer?

A: If you tender your Notes and Warrants pursuant to the Exchange Offer, it will be deemed a rejection of the Rescission Offer unless you thereafter withdraw your tender of Notes and Warrants prior to the expiration of the Exchange Offer and accept the Rescission Offer prior to the Rescission Expiration Date. The Rescission Offer and the Exchange Offer both expire on _______, 2006, unless the Exchange Offer is extended.

Q:If I do not accept the Rescission Offer prior to the Rescission Expiration Date, but have not yet accepted the Exchange Offer, can I still tender my Notes and Warrants in the Exchange Offer?

A:  No.The Rescission Offer and the Exchange Offer both expire on _______, 2006, unless the Exchange Offer is extended.

Q:What will be issued to me in exchange for my Notes and Warrants if I accept the Exchange Offer?

A:For each $1.00 Principal Amount of your Notes, you will receive $.80 Principal Amount of either A Notes or B Notes, based upon your election. For each of your Warrants, you will receive 1.17648 A Warrants and one B Warrant. See “The Exchange Offer - Securities Offered in Exchange for Notes and Warrants; Differences in Securities Offered.”

Q:Why are the principal amounts of the Notes and A Notes and B Notes different?

A:The principal amounts are different because if the A Notes and B Notes had the same principal amount of the Notes, upon the acceptance of the Exchange Offer, you would have adverse income tax consequences. By reducing the principal amount of the A Notes and the B Notes, such adverse tax consequence has been eliminated. See “Certain U.S. Federal Income Tax Considerations.”

Q:Do I have to elect between receipt of the A Notes and the B Notes?

A:Yes. While the repayment terms of the A Notes and the B Notes are the same, your conversion rights under the two Notes are different. You must elect either the A Note or the B Note; you can not receive both notes.

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Q:What are the differences between the repayment terms of the Notes, and the A Notes and B Notes?

A:The interest rate on the A Notes and the B Notes is 8% per annum. The interest rate on the Notes is 6.4% per annum. Because the Notes were issued at a 20% discount, which we refer to as the original issue discount, and because interest is computed based on the principal amount of the Notes, the amount of the annual interest payment on the Notes equals 8% of the original purchase price of the Notes. The security for the repayment of all notes is unchanged. Because of adverse income tax consequences that would occur upon your acceptance of the Exchange Offer if the A Notes and the B Notes had the same Principal Amounts as the Notes, the A Notes and the B Notes offered in exchange for the Notes have a principal amount equal to the original purchase price paid by you (the “New Principal Amount”). If you accept the Exchange Offer and do not convert your A Notes or B Notes into shares of our Common Stock prior to maturity, you would be entitled to receive a principal payment equal to your original cash purchase price at maturity. Conversely, if you do not accept the Exchange Offer and do not convert your Notes into shares of Common Stock prior to maturity, you would be entitled to receive at maturity a principal payment equal to your original cash payment plus the original issue discount on the Notes. The original issue discount on the Notes was $.20 for every $.80 invested.

Q:What are the differences between the conversion terms of the Notes, the A Notes and the B Notes?

A:The A Notes will provide you with the right to convert your A Notes into shares of our Common Stock at a more favorable conversion rate of $.96 New Principal Amount of the A Notes until the expiration of the Offering Period. The Notes have a conversion rate of $1.3325 Principal Amount of the Notes from the date of issuance until May 31, 2007. If you accept the Exchange Offer and elect to receive the A Notes, the reduced conversion rate will allow you to receive more shares of our Common Stock if you elect to convert your A Notes prior to the expiration of the Offering Period. If you accept the Exchange Offer and do not convert your A Notes prior to the expiration of the Offering Period, you will no longer have any conversion rights under the A Notes. See “The Exchange Offer - Securities Offered in Exchange for Notes and Warrants; Differences in Securities Offered.”

The B Notes will provide you with the right to convert your B Notes into shares of our Common Stock at a more favorable conversion rate of $.96 New Principal Amount of the B Notes from 12 months from the date of the consummation of Exchange Offer until May 31, 2007. The Notes have a conversion rate of $1.3325 Principal Amount of the Notes from the date of issuance until May 31, 2007. If you accept the Exchange Offer and elect to receive the B Notes, the reduced conversion rate will allow you to receive more shares of our Common Stock if you elect to convert your B Notes after 12 months from the date of the consummation of Exchange Offer until May 31, 2007. The B Notes are prepayable by us only during the period that the B Notes are convertible into shares of our Common Stock without the consent of the holder of such B Notes.

The terms of the Notes, A Notes and the B Notes are the same other than the differences described in this answer and the previous answer.

Q:Can you give me an example of the increased number of shares of Common Stock I would receive if I accepted the Exchange Offer and later converted either the A Notes or B Notes that I elected to receive?

A:Yes.If, for example, you are the holder of $100,000 Principal Amount of Notes for which you paid $80,000, and you accepted the Exchange Offer, you would receive 83,333 shares of our Common Stock if you later converted the New Principal Amount of your A Notes or your B Notes into Common Stock. If you did not accept the Exchange Offer, and later converted the Principal Amount of your Notes, you would receive 75,047 shares of our Common Stock.

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Q:What are the differences between the terms of the Warrants, and the A Warrants and B Warrants?

The A Warrants will have identical terms to the Warrants except that (1) you will be able to exercise your A Warrants for shares of our Common Stock at a more favorable exercise price of $.85 per share until the expiration of the Offering Period, at which date the A Warrants, if not earlier exercised, will terminate, and (2) because you will receive 1.17648 A Warrants for each Warrant you hold, you will receive more shares upon exercise of the A Warrants than you would have if you had exercised the Warrants. The Warrants have an exercise price of $1.00 per share from the date of issuance through June 30, 2010. See “The Exchange Offer - Securities Offered in Exchange for Notes and Warrants; Differences in Securities Offered.”

The B Warrants are exercisable at $1.00 per share of our Common Stock for a term beginning on 12 months from the consummation of the Exchange Offer and ending June 30, 2010. For each A Warrant you exercise, one B Warrant will terminate. If all A Warrants are exercised, all B Warrants will terminate.

Q:Can you give me an example of the increased number of shares of Common Stock I would receive if I accepted the Exchange Offer and later exercised my A Warrants?

A:Yes.If, as in the prior example, you are the holder of $100,000 Principal Amount of Notes and 50,000 Warrants which are exercisable at $1.00 per share, and you accepted the Exchange Offer, you would receive A Warrants to purchase 58,824 shares of our Common Stock at $.85 per share. If you exercised all of your A Warrants, you would receive 58,824 shares for a total payment of $50,000. If you did not accept the Exchange Offer, and later exercised your Warrants, you would receive 50,000 shares of our Common Stock for a total payment of $50,000.

Q:Do I have to elect to receive either the A Warrants or the B Warrants?

A:No. If you accept the Exchange Offer, you will receive both sets of Warrants. If you exercise your A Warrants, however, the B Warrants will terminate on a one-for-one basis. Thus, if you exercise all of your A Warrants, all of your B Warrants will be terminated.

Q:What if I have already exercised my Warrants or converted my Notes and received shares of Common Stock?

A:If you previously exercised your Warrants or converted your Notes, you may accept the Exchange Offer but only with respect to the remaining Notes and Warrants you continue to own.

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Q:If I accept the Exchange Offer and receive either A Notes or B Notes, what effect will this have on the repayment of the A Notes or B Notes that I receive as compared to the tendered Notes?

A:Whether you accept or reject the Exchange Offer, you will continue to receive the same quarterly interest payments. If you accept the Exchange Offer and do not convert your A Notes or B Notes into shares of our Common Stock, the principal amount due and payable to you will be equal to the original discounted price you paid for the Notes and Warrants which, together with any unpaid accrued interest, which will be due on May 31, 2007. If you do not accept the Exchange Offer and do not convert your Notes into shares of our Common Stock, the principal amount due and payable to you will be equal to the Principal Amount of the Notes at the date they were issued to you which, together with any unpaid accrued interest, which will be due on May 31, 2007. See “The Exchange Offer - Securities Offered in Exchange for Notes and Warrants; Differences in Securities Offered.”

Q:If I accept the Exchange Offer and elect to receive the A Notes, will the shares of Common Stock issued to me if I convert the A Notes and/or exercise the A Warrants be freely tradable?

A:Yes, but only if you convert such A Notes and exercise such A Warrants while the registration statement of which this prospectus is a part remains effective. We intend to keep the registration statement effective until ____ days following the consummation of the Exchange Offer. After that date, your A Notes and A Warrants will no longer be convertible or exercisable, respectively. You will, however, continue to hold your B Warrants. See “The Exchange Offer - General.”

Q:If I accept the Exchange Offer and elect to receive the B Notes, will the shares of Common Stock issued to me if I convert the B Notes be freely tradable?

A:No, unless you purchased your Notes at least two years prior to your conversion. In such case, you may be able to resell the shares issued upon the conversion under Rule 144(k) under the Securities Act if you are not otherwise an affiliate of Scientigo. If you held such Notes for longer than one year but less than two years, you may be able to resell such shares under the volume and manner of resale limitations of Rule 144.

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Q:If I accept the Exchange Offer, but do not exercise all of my A Warrants prior to their expiration, will I receive freely tradable shares of Common Stock if I exercise my remaining B Warrants?

A:No, your shares of Common Stock issued upon exercise of the B Warrants will be issued pursuant to applicable exemptions from registration under the Securities Act and will be “restricted securities” as defined in Rule 144 under the Securities Act.

Q:If I accept the Exchange Offer and later exercise my warrants and/or convert my notes, will I have any fees or other costs on the issuance of the Common Stock to me?

A:No. However, we have agreed to pay fees to Jones Byrd & Attkisson, Inc. (the “Placement Agent”), if allowed by applicable state law, in the event that you accept the Exchange Offer and after issuance of the A Notes or B Notes, and A Warrants and B Warrants, elect to convert your notes into shares of our Common Stock (in the amount of 6% of the New Principal Amount of A Notes and B Notes converted), or to exercise your warrants (in an amount equal to 10% of the aggregate exercise price of A Warrants and B Warrants exercised). This will not, however, affect your rights as a holder of either the A Notes or the B Notes and A Warrants and B Warrants or in any way limit the number of shares of our Common Stock you receive upon such conversion or exercise. See “The Exchange Offer- Fees and Expenses,”“Use of Proceeds” and “Plan of Distribution.”

Q:How many Notes and Warrants will Scientigo accept for exchange?

A:We will accept all outstanding Notes and Warrants properly tendered for exchange. The Exchange Offer is not conditioned on any minimum amount of Notes or number of Warrants being tendered or any other condition other than the proper tender of such Notes and Warrants. See “The Exchange Offer - General.”

Q:What is the purpose of the Exchange Offer?

A:In determining to proceed with the Exchange Offer, the Board of Directors has reviewed, with the assistance of management, its strategic plan and its capital requirements in order to continue its on-going efforts to sell, license or otherwise transfer our intellectual property portfolio. In such regard, the Board of Directors has reviewed, with the assistance of management, the desirability of providing incentives to our holders of Notes and Warrants who do not accept the Rescission Offer to (1) convert their Notes, which bear interest, are repayable in full on May 31, 2007, and are secured by our intellectual property portfolio, for shares of our Common Stock, which do not accrue dividends or interest, are not redeemable and are junior to the Notes in liquidation preference, and (2) exercise their Warrants, which will provide us with additional capital. We intend the Exchange Offer to provide those incentives. An additional purpose of the Exchange Offer is to increase the number of shares of Common Stock outstanding, and therefore increase the potential for more significant trading volume in our Common Stock. See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer.”

Q:How long do I have to tender my Notes and Warrants?

A:You may tender your Notes and Warrants until the Exchange Offer Expiration Date. The Exchange Offer will expire on _____________ 2006, at 12:00 Midnight, New York City time, unless we extend the Exchange Offer. We may choose to extend the Exchange Offer for any reason. We cannot assure you that the Exchange Offer will be extended or, if extended, for how long. See “The Exchange Offer - Procedures for Tendering Notes and Warrants.”

Q:Can the Exchange Offer be extended, amended or terminated, and under what circumstances?

A:We can extend or amend the Exchange Offer in our sole discretion. If we extend the Exchange Offer, we will delay the acceptance of any Notes and Warrants that have been tendered. We can terminate the Exchange Offer under certain circumstances. See “The Exchange Offer - Extension of the Exchange Offer; Termination; Amendment.”

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Q:How will I be notified if Scientigo extends the offer or amends the terms of the Exchange Offer?

A:We will issue a press release no later than 9:00 a.m., New York City time, on the business day after the previously scheduled expiration date if we decide to extend the Exchange Offer. We will announce any amendment to the Exchange Offer by making a public announcement of the amendment. See “The Exchange Offer - Extension of the Exchange Offer; Termination; Amendment.”

Q:Are there any conditions to the Exchange Offer?

A:If you accept the Rescission Offer, you cannot accept the Exchange Offer. Otherwise, there are no other conditions to the Exchange Offer other than the proper tender of your Notes and Warrants in accordance with the instructions in this Exchange Offer and the related Letter of Transmittal. See “The Exchange Offer - General.”

Q:Following the Exchange Offer, will Scientigo continue as a public company?

A:Yes. The completion of the Exchange Offer in accordance with its conditions will not cause Scientigo to stop being subject to the periodic reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act"). See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer.”

Q:How do I tender my Notes and Warrants?

A:To tender your Notes and Warrants, prior to 12:00 Midnight, New York City time, on ____________, 2006, unless the Exchange Offer is extended, you or your nominee must deliver your instruments evidencing the Notes and Warrants and a properly completed and duly executed Letter of Transmittal to Greenberg Traurig, LLP, the Exchange Agent, at the address appearing in the Letter of Transmittal. See “The Exchange Offer - Procedures for Tendering Notes and Warrants.”

Q:Can I keep my Notes and tender just my Warrants?

A:No. To accept the Exchange Offer, you must tender for exchange all of your Notes and all of your Warrants.

Q:Can I change my mind after I have tendered Notes and Warrants in the Exchange Offer?

A:Yes. You may withdraw the Notes and Warrants you have tendered at any time before the expiration of the Exchange Offer, which will occur at 12:00 Midnight, New York City time, on ___________, 2006, unless we extend it. However, if you withdraw such tendered Notes and Warrants and desire to accept the Rescission Offer, you must also affirmatively accept the Rescission Offer prior to _____________, 2005, the Rescission Expiration Date. The Rescission Offer and the Exchange Offer will expire on the same date, unless the Exchange Offer is extended. See “Rescission Offer - Rejection or Failure to Affirmatively Accept” and “The Exchange Offer - Withdrawal Rights.”

Q:How do I withdraw Notes and Warrants I previously tendered?

A:You must deliver on a timely basis a written or facsimile notice of your withdrawal to the Exchange Agent at the address appearing in the Letter of Transmittal. Your notice of withdrawal must specify your name and the name of the registered holder of such Notes and Warrants. See “The Exchange Offer -Withdrawal Rights.”

-29-

Q:Has Scientigo or its Board of Directors adopted a position on the Exchange Offer?

A:Our Board of Directors has approved the Exchange Offer. However, neither we nor our Board of Directors make any recommendation to you as to whether you should tender or refrain from tendering your Notes and Warrants. You must make your own decision as to whether to tender such Notes and Warrants. In doing so, you should read carefully the information in this prospectus and in the related Letter of Transmittal.

Q:Will Scientigo's directors and officers tender Notes and Warrants in the Exchange Offer?

A: Our Chairman of the Board of Directors, a limited partnership (of which our Chairman is a member of the limited liability company which is the general partner), and our Chief Operations Officer, who hold an aggregate of $1,018,750 Principal Amount of Notes and 509,375 Warrants, are eligible to participate in the Rescission Offer. We have been advised that they do not intend to accept the Rescission Offer. We have also been advised that they intend to accept the Exchange Offer. See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer,”“ - Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Notes and the Warrants” and “Rescission Offer - Directors, Officers and Major Stockholders.”

Q:What will happen if I do not accept the Exchange Offer?

A:Holders of Notes and Warrants who choose not to accept the Exchange Offer will continue to own such Notes and Warrants under their original terms. See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer.”

Q:When and how will Scientigo issue either the A Notes or B Notes, and A Warrants and B Warrants for the Notes and Warrants I tender?

A:We will issue the A Notes or B Notes, and the A Warrants and B Warrants promptly after the expiration of the Exchange Offer by delivering such securities to the address set forth in your completed Letter of Transmittal. See “The Exchange Offer - Acceptance of Tendered Notes ad Warrants and Issuance of A Notes, B Notes, A Warrants and B Warrants.”

Q:What is the recent market price for the notes, warrants and the Common Stock?

A:None of the notes or warrants is or will be listed on any exchange and there is no and will be no established trading market for such securities. Our Common Stock trades on the OTC Bulletin Board, under the symbol "MKTE.OB." On ___________, 2005, the closing bid price of one share of our Common Stock on the OTC Bulletin Board was $_____. You are urged to obtain current market quotations for our Common Stock before deciding whether to tender your Notes and Warrants. See “The Exchange Offer - Price Range of the Notes and Warrants.”

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Q:Will I have to pay brokerage fees and commissions if I tender my Notes and Warrants?

A:If you are the holder of record of your Notes and Warrants and you tender such securities directly to the Exchange Agent, you will not incur any brokerage fees or commissions. If you hold your Notes and Warrants through a broker, bank or other nominee and your broker tenders Notes and Warrants on your behalf, your broker may charge you a fee for doing so. We urge you to consult your broker or nominee to determine whether any charges will apply. See “The Exchange Offer - Fees and Expenses.”

Q:What are the United States federal income tax consequences if I tender my Notes and Warrants?

A:Exchanges of Notes for A or B Notes are taxable transactions for U.S. federal income tax purposes, although it is anticipated that losses rather than gains generally will be recognized. Exchanges of Warrants for A Warrants and B Warrants should not be taxable transactions, although it is possible that income or gain would be recognized. See "Certain U.S. Federal Income Tax Considerations -Tax Consequences of the Exchange Offer."

Q:Will I have to pay any transfer taxes if I tender my Notes and Warrants?

A:No.

Q:Who can I talk to if I have questions?

A:Our Exchange Agent will be available to help answer your questions. Their contact information is set forth at the end of this prospectus and in the Letter of Transmittal.

__________________________________________________

Our intent is to exchange all outstanding Notes and Warrants. There are currently outstanding $6,383,950 Principal Amount of Notes and Warrants to purchase 3,164,788 shares of Common Stock. The amount of Notes, Warrants, A Notes, B Notes, A Warrants and B Warrants that will be outstanding following the consummation of the Rescission Offer and following the consummation of the Exchange Offer will not be known until the Rescission Offer and Exchange Offer are completed.

The Exchange Offer is not conditioned on any minimum Principal Amount of Notes and number of Warrants being tendered for exchange. We will accept all such Notes and Warrants properly tendered for exchange in accordance with the procedures set forth in this Exchange Offer. See “The Exchange Offer - General.”

OUR BOARD OF DIRECTORS HAS APPROVED THE RESCISSION OFFER AND THE EXCHANGE OFFER. HOWEVER, NEITHER WE NOR OUR BOARD OF DIRECTORS MAKE ANY RECOMMENDATION TO YOU AS TO WHETHER YOU SHOULD ACCEPT OR REJECT THE RESCISSION OFFER OR TENDER OR REFRAIN FROM TENDERING YOUR NOTES AND WARRANTS IF YOU DO NOT ACCEPT THE RESCISSION OFFER. YOU MUST MAKE YOUR OWN DECISIONS AND CONSULT WITH YOUR OWN LEGAL AND TAX ADVISORS. YOU SHOULD READ CAREFULLY THE INFORMATION IN THIS PROSPECTUS AND IN THE RELATED LETTER OF TRANSMITTAL, INCLUDING OUR REASONS FOR MAKING THE EXCHANGE OFFER. SEE “THE EXCHANGE OFFER.”

Important

If you want to tender your Notes and Warrants, you must do one of the following before the Exchange Offer expires:

·   if your Notes and Warrants are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, contact the nominee and have the nominee tender your Notes and Warrants and any other documents required by the Letter of Transmittal for you to the Exchange Agent for the Exchange Offer; or

·   if you hold Notes and Warrants in your own name, complete and sign a Letter of Transmittal according to its instructions and deliver it, together with any required signature guarantees, the original Notes and Warrants and any other documents required by the Letter of Transmittal, to the Exchange Agent.

TO TENDER YOUR NOTES AND WARRANTSPROPERLY, YOU MUST PROPERLY COMPLETE AND DULY EXECUTE THE LETTER OF TRANSMITTAL.

Questions and requests for assistance may be directed to the Exchange Agent for the Exchange Offer, at the address and telephone number set forth in the Letter of Transmittal and at the end of this prospectus.

We are not making this Exchange Offer to, and will not accept any tendered Notes and Warrants from, holders in any jurisdiction where it would be illegal to do so. However, we may, at our discretion, take any actions necessary for us to make this Exchange Offer to holders in any such jurisdiction.

WE HAVE NOT AUTHORIZED ANY PERSON TO MAKE ANY RECOMMENDATION ON OUR BEHALF AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR NOTES AND WARRANTS IN THE EXCHANGE OFFER. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS OR IN THE RELATED LETTER OF TRANSMITTAL. IF ANYONE MAKES ANY RECOMMENDATION OR REPRESENTATION TO YOU OR GIVES YOU ANY INFORMATION, YOU MUST NOT RELY ON THAT RECOMMENDATION, REPRESENTATION OR INFORMATION AS HAVING BEEN AUTHORIZED BY US.

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SUMMARY CONSOLIDATED FINANCIAL STATEMENTS

The following is a summary of our Financial Statements, which are included in this prospectus. You should read the following data together with “Management’s Discussion and Analysis or Plan of Operation” section of this prospectus as well as with our Financial Statements and the notes therewith. The financial statements as of August 31, 2005 and 2004 and for the years then ended are based on our audited financial statements.

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MARKET CENTRAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AUGUST 31, 2005 AND 2004

	2005			2004
ASSETS
Current Assets:
Cash and cash equivalents	$	2,124,029		$	344,099
Accounts receivable, net of allowance for doubtful accounts of $0		10,000			719,262
Notes receivable - related parties		378,003
Other current assets		205,866			426,401
Total Current Assets		2,717,899			1,489,762
Property and Equipment:
Property and Equipment, net		135,162			45,723
Net assets from discontinued operations					870,827
Other Assets:
Restricted Cash					109,617
Goodwill		745,050			745,050
Other Assets		34,862			90,086
Total Other Assets		779,912			944,753
Total Assets	$	3,632,973		$	3,351,065
LIABILITIES AND DEFICIENCY IN STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities	$	2,123,810		$	3,442,462
Note payable to related parties		365,148			1,210,474
Notes payable, current portion		—			1,830,422
Other current liabilities		181,101			544,657
Total Current Liabilities		2,670,059			7,028,015
Long-term liabilities		2,149,237
Liabilities from discontinued operations					1,598,434
Deficiency in Stockholders' Equity		(1,186,323	)		(5,275,384	)
Total Liabilities and Deficiency in Stockholders' Equity	$	3,632,973		$	3,351,065

33

MARKET CENTRAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF LOSSES

FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

	2005			2004
Revenues, net	$	32,277		$	24,279
Cost of sales		—			7,712
Gross profit		32,277			16,567
Operating expenses:
Selling, general and administrative		9,169,859			3,479,041
Depreciation and amortization		55,028			42,346
Total operating expenses		9,224,888			3,521,387
Loss from operations		(9,192,611	)		(3,504,820	)
Other income (expenses):		283,178
Interest income (expenses)		(2,319,409	)		(131,030	)
Total other expenses		(2,036,231	)		(131,030	)
Loss from continuing operations, before income taxes and discontinued operations		(11,228,842	)		(3,635,850	)
Provision for income taxes		—			—
Loss from continuing operations, before discontinued operations		(11,228,842	)		(3,635,850	)
Loss from discontinued operations		(1,196,936	)		(6,831,687	)
Gain from sales of discontinued operations		1,235,785			—
Net (loss)	$	(11,189,992	)	$	(10,467,537	)
Preferred stock dividend - beneficial conversion feature					(875,000	)
Cumulative convertible preferred stock dividend requirements		(427,401	)		(61,067	)
Net loss attributable to common shareholders	$	(11,617,393	)	$	(11,403,604	)
Net income (loss) per common share (basic and assumed diluted)	$	(0.90	)	$	(0.86	)
Continuing operations:		(0.90	)		(0.34	)
Discontinued operations:		0.00			(0.51	)
Weighted Average Shares Outstanding
Basic and assumed diluted		12,884,516			13,293,655

34

MARKET CENTRAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

	2005			2004
Net cash used in Operating Activities	$	(5,107,658	)	$	(4,721,885	)
Net cash provided by/(used in) financing activities		16,973			(287,634	)
Net cash provided by financing activities		6,870,615			5,015,665
Net increase (decrease) in cash and cash equivalents		1,779,930			6,146
Cash and cash equivalents at beginning of year		344,099			337,953
Cash and cash equivalents at end of year	$	2,124,029		$	344,099
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for interest	$	248,670		$	156,390
Cash paid during the period for income taxes		—			—
Common stock issued in exchange for services rendered		390,276			190,752
Stock options and warrants issued in exchange for services rendered		483,913			1,033,518
Preferred stock issued in exchange for notes payable		1,051,218			—
Accrued preferred stock dividend		427,401			61,067
Accounts receivable net against notes payable to related parties		428,735			—
Beneficial conversion feature on convertible notes		3,419,797
Value of warrants attached to convertible notes		2,482,088
Disposal of US Convergion, Inc.:
Sylvia common stock received					500
Assets disposed of					(68,211	)
Debts assumed by Sylvia					2,967,081
Net gain on disposal of segment					(2,784,370	)
Disposition costs		—			115,000
Disposal of ecommerce support centers, inc.
Cash	$	130,000
Note received		971,000			—
Assets disposed of		(1,511,977	)
Debts assumed by CustomerLinx and Lion Development		1,746,762			—
Net gain on disposal of segment		(1,235,785	)		—
	$	100,000

35

RISK FACTORS

You should carefully consider the risks described below, together with all of the other information included in this prospectus, before making a decision to accept or reject our Rescission Offer or, if you do not accept our Rescission Offer, to accept or reject our Exchange Offer. If any of the following risks actually occurs, our business, financial condition or operating results could be materially and adversely affected.

An investment in our Common Stock is a risky investment. You should not invest in our Common Stock unless you can afford the complete loss of your investment.

The following are some of the potential risks of an investment in our Common Stock and you should read them carefully before making a decision to accept or reject our Rescission Offer or our Exchange Offer.

Risks Related to the Rescission Offer

We do not currently have sufficient cash on hand to fund the consummation of the Rescission Offer if all or substantially all of the holders of the Notes and Warrants accept our Rescission Offer.

The Rescission Offer will be funded from our existing cash balances to the extent available. If the holders of all or a significant portion of the Notes and Warrants accept our offer, our cash resources are insufficient to repurchase all of such Notes, Warrants and/or Common Stock issued upon the exercise of such Warrants or conversion of Notes. In such event, we may have to seek additional capital sources or not consummate some portion of the Rescission Offer acceptances, if any.

We may continue to have potential liability even after this Rescission Offer is made.

The offer and sale of the Notes and Warrants, as well as the issuance of shares of Common Stock upon the exercise of Warrants and the conversion of Notes, may not have been exempt from the registration or qualification requirements under the securities laws of the states in which they were issued or under the Securities Act of 1933, as amended (the “Securities Act”). In order to address these issues, we are making the Rescission Offer to all holders of such Notes, Warrants and shares. However, the Securities Act does not provide that a Rescission Offer will extinguish a holder’s right to rescind the issuance of securities that were not registered or exempt from the registration requirements under the Securities Act. Consequently, should any recipients of our Rescission Offer reject the offer, expressly or impliedly, we may remain liable under the Securities Act for the purchase price of the Notes, Warrants and shares of Common Stock that are subject to the Rescission Offer.

Your federal right of rescission may not survive if you affirmatively reject or fail to accept the Rescission Offer.

If you affirmatively reject or fail to accept the Rescission Offer, it is unclear whether or not you will have a right of rescission under federal securities laws after the expiration of the Rescission Offer. The staff of the Securities and Exchange Commission is of the opinion that a person’s right of rescission created under the Securities Act may survive the Rescission Offer. However, the federal courts in the past have ruled that a person who rejects or fails to accept a rescission offer is precluded from later seeking similar relief.

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We cannot predict whether the amounts you would receive in the Rescission Offer would be greater than the fair market value of our securities.

The amount you would receive in the Rescission Offer is fixed and is not tied to the fair market value of the Notes, the Warrants or our Common Stock at the time the Rescission Offer closes. As a result, if you accept the Rescission Offer, you may receive less than the fair market value of the securities you would be tendering to us.

If you do not accept the Rescission Offer, your Notes and Warrants, although freely tradeable, will have a limited resale market, if at all.

If you affirmatively reject the Rescission Offer or fail to accept the Rescission Offer before the expiration of the Rescission Offer, your Notes and Warrants will be registered under the Securities Act and will be freely tradeable. However, there is no established market for the Notes or the Warrants, and no such market is expected to be established after the completion of the Rescission Offer.

If you do not accept the Rescission Offer, the shares of Common Stock you receive from the later conversion of your Notes and/or the exercise of your Warrants will be freely tradable if you convert and/or exercise your Notes and Warrants, respectively, while the registration statement of which this prospectus is a part is effective. The market for our Common Stock may be limited.

If you affirmatively reject the Rescission Offer or fail to accept the Rescission Offer before the expiration of the Rescission Offer, the shares of Common Stock you receive upon the later conversion of your Notes, if any, and/or the exercise of your Warrants, if any, may be registered under the Securities Act and will be freely tradeable. However, such conversion and/or exercise must occur when the registration statement of which this prospectus is a part is effective. Scientigo intends to maintain such effectiveness for ____ days following the consummation of the Exchange Offer. If you do not convert and/or exercise until after such date, the shares of Common Stock you receive will be restricted securities and will have significant limitations under federal securities laws on their resale.

Our Common Stock is traded on the OTC Bulletin Board under the symbol MKTE.OB. Prior to this offering, there has been a limited public market for our Common Stock and there can be no assurance that an active trading market for our Common Stock will develop. As a result, this could adversely affect our stockholders’ ability to sell our Common Stock in short time periods, or possibly at all. Our Common Stock is thinly traded compared to larger, more widely known companies in the information technology services industry. Thinly traded Common Stock can be more volatile than Common Stock traded in an active public market. Our Common Stock has experienced, and is likely to experience in the future, significant price and volume fluctuations, which could adversely affect the market price of our Common Stock without regard to our operating performance. In addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets could cause the price of our Common Stock to fluctuate substantially.

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Risks Related to the Exchange Offer

There is no assurance that our Exchange Offer will achieve its desired effect of providing incentives to our holders of Notes and Warrants to convert their Notes and exercise their Warrants.

One of the important purposes of the Exchange Offer is to provide incentives for our Note and Warrant holders to convert their notes and exercise their warrants, thereby reducing our indebtedness and providing additional capital to us. The decision of a holder to take such actions could be influenced by a number of factors including the market price of our Common Stock, our future business prospects and the personal financial circumstances of a note and warrant holder. There can be no assurance that holders of Notes and Warrants will convert such Notes and/or exercise such Warrants even if they accept the Exchange Offer.

The issuance of additional shares of our Common Stock upon the conversion of A Notes or B Notes and the exercise of A Warrants will dilute our existing stockholders as well as our future stockholders.

If a significant number of the holders of our Notes and Warrants accept the Exchange Offer and later convert their A Notes or B Notes and/or exercise their A Warrants or B Warrants at the more favorable conversion and exercise prices available to them, we will issue a significant number of additional shares of our Common Stock. The conversion of the A Notes and B Notes will not provide any additional capital to us. While the exercise of A Warrants and B Warrants will provide additional capital for us, the exercise prices of $.85 and $1.00 per share, respectively, are below the recent trading range of our Common Stock. These issuances will dilute the ownership by other holders of our Common Stock.

Risks Related To Our Business

We may not be successful in our efforts related to the sale, license or other transfer for value of our intelligent business process automation technologies.

Our success or failure will depend to a large extent upon our ability to successfully execute the sale, license or other transfer for value of our intelligent Business Process Automation Technologies including the licensing of intellectual property to partners whose products and services compliment our technology for the benefit of our clients. To date, we have not generated any significant revenue with respect to such technologies. There is no assurance that we will be successful in such monetization efforts.

We are not currently generating positive cash flow and our cash resources on hand are insufficient for our long term needs.

In the absence of the obtaining of additional capital, we would be unable to continue operations at our current level for any significant period of time.

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We have incurred significant losses recently.

We have incurred significant losses as a result of our efforts to license, sell or otherwise transfer our intellectual property portfolio. There is no assurance that such losses will not continue to occur.

We may need additional financing to maintain and expand our business, but it may not be available on favorable terms or at all.

Subject to the results of the Rescission Offer, we currently anticipate that our available cash resources will be sufficient to meet our anticipated working capital and capital expenditure requirements for the next six to nine months. We may need to raise additional funds, however, to fund more rapid expansion, respond to competitive pressures, acquire other businesses or technologies or meet unanticipated working capital requirements. It is possible that future funding may not be available to us on favorable terms or at all. If we borrow money, we may incur significant interest expense and become subject to covenants that could limit our ability to operate and fund our business. If we need funds and cannot raise them on acceptable terms, we may be unable to realize our current plans or take advantage of unanticipated opportunities and could be required to slow our growth or reduce or shut down our operations.

We do not expect to pay dividends.

We have never declared or paid any cash dividends on our capital stock. We currently intend to retain any earnings for use in the operation and expansion of our business and do not anticipate paying any cash dividends in the foreseeable future. Any return on the investment in our Common Stock will be as a result of appreciation, if any, in our stock price.

Our market for our products is characterized by new products and rapid technological change.

The market for business application software is characterized by rapid technological advancements, changes in customer requirements, frequent new product introductions and enhancements and changing industry standards. The life cycles of our products are difficult to estimate and our current market position could be undermined by rapid technological changes and the introduction of new products and enhancements by new or existing competitors. Our growth and future success will depend, in part, upon our ability to enhance our current products and introduce new products in order to keep pace with products offered by our competitors, adapt to technological advancements and changing industry standards and produce additional functionality to address the increasingly sophisticated requirements of our customers. Our product development efforts are expected to require substantial additional investment by us. There can be no assurance that we will have sufficient resources to make the necessary investment or that we will not experience difficulties that could delay or prevent the successful development, introduction or marketing of new products or enhancements. Any failure by us to anticipate or respond adequately to technological advancements, customer requirements and changing industry standards, or any significant delays in the development, introduction or availability of new products or enhancements, could have a material adverse effect on our business, operating results and financial condition.

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We operate in a highly competitive market and our failure to keep our technology up-to-date may prevent us from remaining competitive.

The market for our products is intensely competitive and rapidly changing. We compete primarily with products offered by ABBYY, Datacap, OCE, SWT, ReadSoft and AnyDoc for Intelligent Document Recognition and Google, Yahoo, Microsoft, Autonomy, Convera, FAST Search and Transfer and Verify for Intelligent Search. Some of our existing competitors, as well as a number of potential new competitors, have larger technical staffs, more established and larger sales and marketing organizations and greater financial resources than us. There can be no assurance that we will continue to compete successfully with our existing competitors or will be able to compete successfully with new competitors. In addition, there can be no assurance that competitors will not develop products that are superior to our products or achieve greater market acceptance. Competitive pressures in the form of aggressive price competition could also have a material adverse effect on our business, operating results and financial condition. Our future success will depend significantly upon our ability to increase our share of our target markets, to maintain and increase our renewal revenues from existing customers and to sell additional products, product enhancements, maintenance and support agreements and training services to existing customers and new customers. There can be no assurance that we will continue to compete favorably or that competition will not have a material adverse effect on our business, operating results or financial condition.

The protection of our intellectual property may be inadequate.

Our ability to develop and maintain the proprietary aspects of our technology is critical to the future success of our business. To protect our proprietary technology, we rely primarily on a combination of confidentiality procedures, contractual provisions, trade secrets and patent, copyright and trademark laws. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our products or to obtain and use information that we regard as proprietary. Policing unauthorized use of our products is difficult and, while we are unable to determine the extent to which piracy of our software products exists, software piracy can be expected to be a persistent problem, particularly in international markets and as a result of the growing use of the Internet. In addition, the laws of some foreign countries do not protect our proprietary rights to the same extent as do the laws of the United States. Litigation may be necessary to enforce our intellectual property rights and to protect our trade secrets. Such litigation could result in substantial costs and diversion of resources and could harm our business. There can be no assurance that the steps taken by us to protect our proprietary rights will be adequate or that our competitors will not independently develop products or technologies that are substantially equivalent or superior to our products or technologies.

We may in the future be subject to intellectual property rights claims which are costly to defend, could require us to pay damages and could limit our ability to use certain technology in the future.

We are not aware that any of our products, trademarks or other proprietary rights infringe the proprietary rights of third parties. However, there can be no assurance that third parties will not assert infringement claims against us in the future with respect to current or future products. As the number of software products in the industry increases and the functionality of these products further overlap, we believe that software developers may become increasingly subject to infringement claims. Any such claims, with or without merit, can be time-consuming and expensive to defend, cause product shipment delays or require us to enter into royalty or licensing agreements. Such royalty agreements, if required, may not be available on terms acceptable to us, or at all, which could have a material adverse effect on our business, operating results and financial condition.

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We are dependent on key personnel.

We are dependent upon the skills and experience of our key management team especially our CEO, Doyal Bryant, and our Senior Vice President - Software Applications and Solutions, Paul Odom. Each member of the management team, brings his own unique and distinct skills and long history of business experience to Scientigo, and it may not be possible or reasonably practicable to replace any of them should they cease working with Scientigo. Therefore, a loss of any key members of our management team could cause significant harm to our operations and business.

We may face shortages of highly skilled labor.

We operate in an industry that requires highly technical skilled talent. Competition for highly skilled personnel is intense and there is a shortage of such highly skilled technology talent in the United States. We may fail to retain our existing personnel or to attract, assimilate, manage and retain qualified personnel to fulfill our current or future needs. If we fail to do so, our revenue could decline and our operating expenses could increase. The inability to hire and retain competent technical talent would also jeopardize our growth plans.

We may fail to effectively manage growth.

As with all expanding businesses, the potential exists that growth will occur rapidly. If we are unable to effectively manage this growth, our business and operating results could suffer. Anticipated growth in future operations may place a significant strain on management systems and resources. In addition, the integration of new personnel will continue to result in some disruption to ongoing operations. The ability to effectively manage growth in a rapidly evolving market requires effective planning and management processes. We will need to continue to improve operational, financial and managerial controls, reporting systems and procedures, and will need to continue to expand, train and manage our work force.

Defects or errors within our software products could adversely affect our business, results of operations and financial condition.

Software products such as those licensed by us typically contain undetected errors or failures when first introduced or as new versions are released. Testing of our products is particularly challenging because it is difficult to simulate the wide variety of computing environments in which our customers may deploy these products. Despite extensive testing, we from time to time have discovered defects or errors in our products. Accordingly, there can be no assurance that such defects, errors or difficulties will not cause delays in product introductions and shipments, result in increased costs and diversion of development resources, require design modifications or decrease market acceptance or customer satisfaction with our products. In addition, there can be no assurance that, despite testing by us and by current and potential customers, errors will not be found after commencement of commercial shipments, resulting in loss of or delay in market acceptance, which could have a material adverse effect upon our business, operating results and financial condition.

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It may also result in financial or other damages to our clients, for which we may be held responsible. Although our agreements with our clients generally contain provisions designed to limit our exposure to potential claims and liabilities arising from client problems, these provisions may not effectively protect us against such claims in all cases and in all jurisdictions.

Claims and liabilities arising from client problems could result in monetary damages to us and could damage our reputation, adversely affecting our business, results of operations and financial condition.

General economic or business conditions could be worse than management expects.

Any factors that adversely affect the economy of our market areas could adversely affect our performance.

We may not be able to successfully identify, manage and integrate future acquisitions, which may harm our operating results and deplete our financial resources.

In the future, we may try to acquire companies or businesses that are complementary to ours. If we do identify an appropriate acquisition candidate, we cannot make an assurance that we would be able to successfully negotiate the terms of an acquisition, finance the acquisition or integrate the acquired business into our existing business. Negotiations of potential acquisitions and the integration of an acquired business could disrupt our business by diverting management away from day-to-day operations. Further, failure to successfully integrate any acquisition may cause significant operating inefficiencies and force us to curtail or cease our business operations.

In the event of any future acquisitions, we may:

·   issue stock that would dilute our current stockholders’ percentage ownership;

·   incur debt;

·   assume liabilities;

·   incur amortization expenses related to goodwill and other intangible assets; or

·   incur large and immediate write-offs.

The use of debt or leverage to finance our future acquisitions should allow us to make acquisitions with an amount of cash in excess of what may be currently available to us. If we use debt to leverage our assets, we may not be able to meet our debt obligations if our internal projections are incorrect or if there is a market downturn. This may result in a default and the loss in foreclosure proceedings of the acquired business and/or the possible bankruptcy of our business.

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Our operation of any acquired business will also involve additional risks, including:

·   unanticipated costs;

·   adverse effects on existing business relationships with suppliers and customers;

·   risks associated with entering markets in which we have limited prior experience; and

·   potential loss of key employees, particularly those of the purchased organizations.

RESCISSION OFFER

Background

The offer and sale of the $6,633,950 Principal Amount of Notes and 3,316,975 Warrants that we issued to investors from May 2005 through September 2005 may not have been exempt from the registration requirements under the Securities Act or from the registration or qualification requirements under the securities laws of certain states. Consequently, the issuance of the Notes and Warrants may not have complied with the Securities Act and the state securities laws of Alabama, Georgia, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia. Our Board of Directors has determined to conduct this Rescission Offer to address these securities laws compliance issues by allowing the holders of the Notes and Warrants, as well as the holders of 339,804 shares of Common Stock issued upon the exercise of Warrants and the conversion of Notes, to rescind the purchase of such securities and sell those securities back to us if they so desire.

We are making this Rescission Offer to 100 persons who are or were residents of Alabama, California, Colorado, Georgia, Kansas, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia. If our Rescission Offer is accepted by all offerees, we could be required to make an aggregate payment to the holders of the Notes, Warrants and shares of Common Stock of up to approximately $____ million, which includes statutory interest. We do not currently have sufficient cash on hand to make such payments if all or substantially all of the offerees accepted our Rescission Offer. In such event, we may have to seek additional capital sources or not consummate some portion of the Rescission Offer acceptances, if any.

The following is a description of the Notes and Warrants that are subject to the Rescission Offer, including the issuance of Common Stock to investors who have exercised their Warrants or converted their Notes:

• Notes and Warrants. This Rescission Offer is being made to 98 holders of $6,383,950 Principal Amount of the Notes and 96 holders of 3,164,788 Warrants. The issuance of these Notes and Warrants may not have complied with the Securities Act and applicable state securities laws because the offering may have been conducted by the use of general solicitation in violation of the requirements of Regulation D promulgated under the Securities Act. We did not register the offer or sale of these Notes and Warrants under the Securities Act or any state securities laws.

• Common Stock.    The Rescission Offer is also being made to four (4) holders of an aggregate of 339,804 shares of Common Stock issued upon the exercise of Warrants and the conversion of Notes. The issuance of these shares of Common Stock may not have complied with the Securities Act and applicable state securities laws because the offering of the Notes and Warrants may have been conducted by the use of general solicitation in violation of the requirements of Regulation D promulgated under the Securities Act.

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The Rescission Offer will be kept open for 30 days and has been registered under the Securities Act and qualified in each state where such qualification is required under applicable state securities laws.

Rescission Offer and Price

We are offering to rescind the issuance of the Notes, Warrants and Common Stock issued upon the exercise of Warrants and conversion of Notes. By making this Rescission Offer, we are not waiving any applicable statutes of limitations.

More specifically, we are offering to rescind the sale of $6,383,950 Principal Amount of the Notes which are held by 98 holders, 3,164,788 Warrants which are held by 96 holders, and the issuance upon the exercise of Warrants and conversion of Notes of 339,804 shares of Common Stock which remain outstanding and are currently held by four (4) persons. This offer will be made to the holders of the Notes and Warrants as well as those holders of Common Stock who are, or were at the time of issuance residents of Alabama, California, Colorado, Georgia, Kansas, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia.

If you accept our Rescission Offer and you hold Notes and Warrants, we will repurchase the Notes and Warrants you hold that are subject to the Rescission Offer at the price you paid for such Notes and Warrants, plus interest at the current statutory rate per year mandated by your state of residence, if any, from the date of issuance of the Notes and Warrants through the date of payment pursuant to the Rescission Offer, less any interest paid to you pursuant to the terms of the Notes (other than Ohio, where you would receive a return of your original investment without interest). We intend to make such payments no later than _________, 200_ (the fifth day after the Rescission Offer expires). If you accept our Rescission Offer and have already exercised your Warrants and been issued shares of Common Stock pursuant to the terms of such Warrants, we will also repurchase such shares issued to you at $1.00 per share, the price you paid upon exercise, plus interest at the current statutory rate per year, from the date of issuance of such shares through the date that we make payments under the Rescission Offer. If you accept our Rescission Offer and you hold shares of Common Stock that were issued upon the conversion of your Notes, we will repurchase such shares of Common Stock at the price you paid for your Notes and Warrants, plus interest at the current statutory rate per year mandated by your state of residence, if any, from the date of issuance of the Notes and Warrants through the date of payment pursuant to the Rescission Offer, less any interest paid to you pursuant to the terms of the Notes.

We have paid interest currently on the Notes at a cash rate of 8% per annum through August 31, 2005, and intend to pay such interest due on November 30, 2005, in accordance with the terms of the Notes. In the event that the statutory rate of interest to which you are entitled pursuant to the applicable state law of your residence is less than 8% per annum, the amount due to you if you accept the Rescission Offer may be less than the consideration you paid upon the original purchase of the Notes and Warrants. This results from the fact that in many states (including Alabama, California, Mississippi, New Jersey, South Carolina and Virginia), we have or will have, at the time of the rescission payment, already paid to you a rate of interest in excess of the interest rate to which you are entitled under applicable state law if you accept the Rescission Offer.

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We intend to use the legal rates of interest for the repurchase of the Notes and Warrants (including shares of Common Stock issued upon the exercise of Warrants) based on your state of residence. These interest rates are as follows:

STATE OF RESIDENCE	INTEREST RATE
Alabama	6%
California	7%
Colorado	8%
Georgia	8%
Kansas	6.25% prior to July 1, 2005; 8.25% thereafter
Maryland	10%
Mississippi	6%
New Jersey	3% prior to January 1, 2006; 4% thereafter
North Carolina	8%
Ohio	none
South Carolina	6%
Utah	12%
Virginia	6%

Acceptance

You may accept the Rescission Offer by completing and signing the enclosed election form (the “Election Form”) indicating the Notes and Warrants (including shares of Common Stock issued upon the exercise of Warrants and the conversion of Notes) to be repurchased and delivering the original Notes and Warrants (including certificates representing the shares of Common Stock issued upon the exercise of Warrants and the conversion of Notes) and a stock power representing such Notes and Warrants (including shares of Common Stock issued upon the exercise of Warrants and the conversion of Notes) you are surrendering for repurchase, on or before 5:00 p.m., New York City time, on ____________, 200_ (the “Rescission Expiration Date”). All acceptances of the Rescission Offer will be deemed to be effective on the Rescission Expiration Date and the right to accept the Rescission Offer will terminate on the Rescission Expiration Date. Acceptances or rejections may be revoked in a written notice to us, to the attention of Clifford A. Clark, Secretary, 6701 Carmel Road, Suite 205, Charlotte, NC 28226, which is received prior to the Rescission Expiration Date. If you accept the Rescission Offer, you will receive payment for your rescinded securities within five (5) business days after the Rescission Expiration Date.

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The Rescission Offer will expire at 5:00 p.m., New York City time, on __________, 2005. If you submit an Election Form after the expiration time, regardless of whether your form is otherwise complete, your election will not be accepted, and you will be deemed to have rejected our Rescission Offer.

Neither we nor our officers and directors make any recommendations to you with respect to the Rescission Offer contained herein. You are urged to read the terms of the Rescission Offer set forth herein carefully and to make an independent evaluation with respect to its terms.

IF PERSONS DESIRING TO ACCEPT THE RESCISSION OFFER INTEND TO MAKE USE OF THE MAIL TO RETURN THEIR STOCK POWERS, INSURED REGISTERED MAIL, RETURN RECEIPT REQUESTED, IS RECOMMENDED.

Rejection or Failure to Affirmatively Accept

If you fail to accept, or if you affirmatively reject the Rescission Offer by so indicating on the Election Form, you will retain ownership of your Notes and Warrants (including shares of Common Stock issued upon the exercise of Warrants and the conversion of Notes) and you will not receive any cash for those securities in connection with the Rescission Offer. Additionally, if you accept our Exchange Offer described elsewhere in this prospectus, you will be deemed to have rejected the Rescission Offer by so acknowledging on the enclosed Letter of Transmittal for the Exchange Offer, and you will retain ownership of your Notes and Warrants (including shares of common stock issued upon the exercise of Warrants) and you will not receive any cash for those securities in connection with the Rescission Offer. In such event, your Notes and Warrants and any shares of our Common Stock issued upon the conversion of the Notes and the exercise of the Warrants will be registered and fully tradeable under the Securities Act if you convert such Notes and exercise such Warrants during the period that the registration statement of which this prospectus is a part is effective, which is expected to be until ____ days following the consummation of the Exchange Offer. If you are an affiliate of Scientigo within the meaning of Rule 144 or Rule 145, you will be subject to resale restrictions notwithstanding such registration and your subsequent conversion of Notes or exercise of Warrants.

Solicitation

We have not retained, nor do we intend to retain, any person to make solicitations or recommendations to you in connection with the Rescission Offer.

Effect of Rescission Offer

It is unclear whether the Rescission Offer will terminate our liability, if any, for failure to register or qualify the issuance of the securities under either federal or state securities laws. Accordingly, should the Rescission Offer be rejected by any or all offerees, we may continue to be contingently liable under the Securities Act and applicable state securities laws for the purchase price of these Notes and Warrants (including shares of Common Stock issued upon the exercise of Warrants) up to an aggregate amount of approximately $____ million, which includes statutory interest. If you are a Note and Warrant holder or an owner of shares of Common Stock issued upon the exercise of the Warrants or conversion of Notes, it is possible that you may continue to have rights under common law or fraud statutes in the state in which the potential securities violation with respect to your Notes and Warrants occurred.

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Regardless of whether you accept the Rescission Offer, we believe that any remedies you may have after the Rescission Offer expires would not be greater than an amount you would receive in the Rescission Offer, except to the extent that you are a resident of the state of Mississippi in which your right, if any, to such rescission under applicable law would provide you with a statutory rate of interest of 8% per annum rather than 6% per annum as mandated by Mississippi law regarding this Rescission Offer.

Below is a discussion of our contingent liability in those states where we may have potential securities laws violations resulting from our issuance of the Notes and Warrants (including shares of Common Stock issued upon the exercise of Warrants and conversion of Notes) which are covered by the Rescission Offer. Each state has different laws with respect to rights under common law and fraud statutes and the following discussion of state law does not relate to the antifraud provisions of applicable securities laws or rights under common law or equity. In addition, while certain holders of Notes and Warrants who are residents of California, Colorado and Kansas may have a right of rescission under federal securities laws, we believe the Notes and Warrants issued by us in those states were issued pursuant to an exemption from registration or qualification requirements available to us under applicable state securities laws.

Alabama

Under Alabama law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Alabama Securities Act. The purchaser may sue at any time prior to the two year anniversary of the date of sale to recover (1) the consideration paid for such securities with interest at 6% per year from the date of payment, court costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or (2) for damages if the purchaser no longer owns the securities.

However, we may terminate the rights of the purchasers to seek additional remedies under the Alabama Securities Act by making a written rescission offer, before suit, to refund the consideration paid together with interest at 6% per year from the date of payment less the amount of any income received on the securities. If the purchaser owns the securities and fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under Alabama law. If the purchaser receives such offer at a time when the purchaser does not own the securities, that purchaser will no longer have any right of rescission under Alabama law unless the purchaser rejects the offer in writing within 30 days of its receipt.

We believe this Rescission Offer complies in all material respects with the rescission offer requirements of the Alabama Securities Act.

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Georgia 

Under Georgia law, an issuer is civilly liable to a purchaser of its interest-bearing securities sold in violation of the registration requirements of the Georgia Securities Act of 1973. The purchaser may sue to recover the consideration paid for such securities with interest at a rate equal to the rate stated in such interest-bearing securities from the date of payment, taxable court costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or for damages if the purchaser no longer owns the securities, at any time prior to the two year anniversary date of the contract of sale, or sale if there is no contract of sale.

However, we may terminate the rights of the purchasers to seek additional remedies under the Georgia Securities Act by making a written rescission offer, before suit, to repay in cash or by certified or official bank check the fair value of the consideration paid (determined as of the date such payment was originally paid by the investor) together with interest at 8% on the amount paid for the Notes and Warrants (the rate of interest stated in the Notes) less any interest paid by us on the Notes. If the purchaser owns the securities and fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under Georgia law. If the purchaser receives such offer at a time when the purchaser does not own the securities, that purchaser will no longer have any right of rescission under Georgia law unless the purchaser rejects the offer in writing within 30 days of its receipt.

We believe this Rescission Offer complies in all material respects with the rescission offer requirements of the Georgia Securities Act.

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Maryland

Under Maryland law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration or qualification requirements of the Maryland Securities Act. The purchaser may sue either at law or in equity at any time prior to the one year anniversary of the noncompliance with the registration or qualification requirements (1) to recover the consideration paid for such securities, together with interest at the rate of 10% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or (2) for damages if the purchaser no longer owns the securities.

However, we may terminate the rights of the purchasers to seek additional remedies under the Maryland Securities Act by making a written rescission offer, before suit, to refund the consideration paid together with interest at the rate of 10% per year from the date of payment, less the amount of any income received on the securities. If the purchaser owns the securities and fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under Maryland law. If the purchaser receives such offer at a time when the purchaser does not own the securities, that purchaser will no longer have any right of rescission under Maryland law unless the purchaser rejects the offer in writing within 30 days of its receipt.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the Maryland Securities Act.

Mississippi

Under Mississippi law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Mississippi Securities Act. The purchaser may sue at any time prior to the two year anniversary of the date of sale (1) to recover the consideration paid for such securities with interest at 8% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or (2) for actual damages if the purchaser no longer owns the securities.,

However, we may terminate the rights of the purchasers to seek such remedy under the Mississippi Securities Act by making a written rescission offer before suit is commenced stating the respect in which liability under this section may have arisen and fairly advising the purchaser of his rights; offering to repurchase the security for cash payable on delivery of the security equal to the consideration paid, together with interest at 6% from the date of payment, less the amount of any income received on the security or, if the purchaser no longer owns the security, offering to pay the purchaser upon acceptance of the offer an amount in cash equal to his damages; and stating that the offer may be accepted by the purchaser at any time within 30 days of its receipt. If the purchaser fails to accept such offer in writing within the 30 day period, that purchaser will no longer have any right of rescission under Mississippi law.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the Mississippi Securities Act.

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New Jersey

Under New Jersey law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the New Jersey Uniform Securities Act. The purchaser may sue at any time prior to the two year anniversary of the contract of sale (1) to recover the consideration paid for such securities with interest at 3% per year through December 31, 2005, and 4% thereafter, from the date of payment and costs, less the amount of any income received on the securities, or (2) for actual damages if the purchaser no longer owns the securities.

However, we may terminate the rights of the purchasers to seek additional remedies under the New Jersey Uniform Securities Act by making a written rescission offer, before suit, to refund the consideration paid together with interest at the rate of 3% per year through December 31, 2005, and 4% thereafter, from the date of payment, less the amount of any income received on the securities. If the purchaser owns the securities and fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under New Jersey law. If the purchaser receives such offer at a time when the purchaser does not own the securities, that purchaser will no longer have any right of rescission under New Jersey law unless the purchaser rejects the offer in writing within 30 days of its receipt.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the New Jersey Uniform Securities Act.

North Carolina

Under North Carolina law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the North Carolina Securities Act. The purchaser may sue either at law or in equity at any time prior to the two year anniversary of the date of sale (1) to recover the consideration paid for such securities with interest at 8% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or (2) for actual damages if the purchaser no longer owns the securities.

However, we may terminate the rights of the purchasers to seek such remedy under the North Carolina Securities Act by making a written rescission offer before suit is commenced stating the respect in which liability under the North Carolina Securities Act may have arisen and fairly advising the purchaser of his rights; offering to repurchase the security for cash payable on delivery of the security equal to the consideration paid, together with interest at eight percent (8%) from the date of payment, less the amount of any income received on the security or, if the purchaser no longer owns the security, offering to pay the purchaser upon acceptance of the offer an amount in cash equal to his damages; and stating that the offer may be accepted by the purchaser at any time within 30 days of its receipt. If the purchaser fails to accept such offer in writing within the 30 day period, that purchaser will no longer have any right of rescission under North Carolina law.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the North Carolina Securities Act.

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Ohio

Under Ohio law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Ohio Securities Act. The purchaser may sue to recover the full amount paid for such securities and all taxable court costs, unless the court determines the violation did not materially affect the protection contemplated by the violated provision of the Ohio Securities Act. The action may not be brought more than two years after the investor knew or had reason to know of the facts by reason of which the actions of the issuer were unlawful, or more than five years from the date of such sale, whichever is the shorter period.

However, we may terminate the rights of the purchasers to seek such remedy under the Ohio Securities Act by making a written rescission offer, before suit, to refund the consideration paid for the securities. If the purchaser fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under Ohio law.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the Ohio Securities Act.

South Carolina

Under South Carolina law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the South Carolina Uniform Securities Act. The purchaser may sue either at law or in equity (1) to recover the consideration paid for such securities with interest at 6% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or (2) for actual damages if the purchaser no longer owns the securities.

However, we may terminate the rights of the purchasers to seek additional remedies under the South Carolina Uniform Securities Act by making a written rescission offer, before suit, to refund the consideration paid together with interest at the rate of 6% per year from the date of payment, less the amount of any income received on the securities. If the purchaser owns the securities and fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under South Carolina law. If the purchaser receives such offer at a time when the purchaser does not own the securities, that purchaser will no longer have any right of rescission under South Carolina law unless the purchaser rejects the offer in writing within 30 days of its receipt.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the South Carolina Uniform Securities Act.

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Utah

Under Utah law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Utah Uniform Securities Act. The purchaser may sue either at law or in equity (1) to recover the consideration paid for such securities with interest at 12% per year from the date of payment, costs and reasonable attorneys’ fees, less the amount of any income received on the securities, or (2) for actual damages if the purchaser no longer owns the securities, at any time prior to the four year anniversary of the date of sale or prior to two years after the discovery by the purchase of the facts constituting the violation, which ever occurs first. Under Utah law, the purchaser may be entitled to recover an amount equal to three times the amount otherwise recoverable as described above upon a showing that the violation was reckless or intentional. We do not believe that the possible violation was either reckless or intentional.

However, we may terminate the rights of the purchasers to seek additional remedies under the Utah Uniform Securities Act by making a written rescission offer, before suit, to refund the consideration paid together with interest at the rate of 12% per year from the date of payment, less the amount of any income received on the securities. If the purchaser owns the securities and fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under Utah law. If the purchaser receives such offer at a time when the purchaser does not own the securities, that purchaser will no longer have any right of rescission under Utah law unless the purchaser rejects the offer in writing within 30 days of its receipt.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the Utah Uniform Securities Act.

Virginia

Under Virginia law, an issuer is civilly liable to a purchaser of its securities sold in violation of the registration requirements of the Virginia Securities Act. The purchaser may sue at any time prior to the two year anniversary of the sale (1) to recover the consideration paid for such securities with interest at 6% per year from the date of payment and costs, less the amount of any income received on the securities, or (2) for actual damages if the purchaser no longer owns the securities .

However, we may terminate the rights of the purchasers to seek additional remedies under the Virginia Securities Act by making a written rescission offer, before suit, to refund the consideration paid together with interest at the rate of 6% per year from the date of payment, less the amount of any income received on the securities, or if the security is no longer owned by such purchaser, to pay damages. If the purchaser refuses or fails to accept such offer within 30 days of its receipt, that purchaser will no longer have any right of rescission under Virginia law.

We believe that this Rescission Offer complies in all material respects with the rescission offer requirements of the Virginia Securities Act.

Funding the Rescission Offer

The Rescission Offer will be funded from our existing cash balances to the extent available. If the holders of all or a significant portion of the Notes and Warrants accept our offer, our cash resources are insufficient to repurchase all of such Notes, Warrants and/or Common Stock issued upon the exercise of such Warrants. In such event, we may have to seek additional capital sources or not consummate some portion of the Rescission Offer acceptances, if any. See “Risk Factors - Risks Related to the Rescission Offer.”

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Directors, Officers and Major Stockholders

Our Chairman of the Board of Directors, a limited partnership (of which our Chairman is a member of the limited liability company which is the general partner), and our Chief Operations Officer, who hold an aggregate of $1,018,750 Principal Amount of Notes and 509,375 Warrants, are eligible to participate in the Rescission Offer. We have been advised that they do not intend to accept the Rescission Offer. We have also been advised that they intend to accept the Exchange Offer. See “The Exchange Offer - Purposes of the Exchange Offer; Certain Effects of the Exchange Offer” and “ - Interests of Directors and Executive Officers; Transactions and Arrangements Concerning the Notes and the Warrants.”

THE EXCHANGE OFFER

General

If you accept the Rescission Offer, you may not participate in the Exchange Offer.

We will exchange either A or B Notes and both A and B Warrants for all Notes and Warrants properly tendered (and not properly withdrawn) to the Exchange Agent for cancellation before the expiration of the Exchange Offer. The Exchange Offer will expire at 12:00 Midnight, New York City time, on _________, 200_ (the “Exchange Offer Expiration Date”), unless the Exchange Offer is extended, which it may be at our discretion subject to applicable law.

The Exchange Offer is not conditioned on any minimum number of shares of Notes and Warrants being tendered. Any Notes and Warrants properly tendered to the Exchange Agent prior to the Exchange Offer Expiration Date will be accepted and either A Notes or B Notes (as elected by the tendering holder) and A Warrants and B Warrants will be issued in exchange.

Promptly following the Exchange Offer Expiration Date, we will issue $.80 Principal Amount of either A Notes or B Notes (as elected by the tendering holder), and 1.17648 A Warrants and one (1) B Warrant for each $1.00 Principal Amount of Notes and one (1) Warrant properly tendered for cancellation, respectively.

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This prospectus and the related Letter of Transmittal will be mailed to record holders of Notes and Warrants, and will be furnished to brokers, dealers, commercial banks and trust companies whose names, or the names of whose nominees, appear on our Note and Warrant holder lists.

Securities Offered in Exchange for Notes and Warrants; Differences in Rights of New A Notes and B Notes Offered

If you accept the Exchange Offer, you will be entitled to elect to receive either $.80 Principal Amount of an A Note or a B Note, and 1.17648 A Warrants and one (1) B Warrant for each $1.00 Principal Amount of Notes and one (1) Warrant properly tendered for cancellation.

Terms of the A Notes and B Notes

Principal, Maturity and Interest

We will issue an aggregate New Principal Amount of up to $5,107,160 of the A Notes and the B Notes in the Exchange Offer.

The New Principal Amount and all accrued but unpaid interest of the A Notes and B Notes will be due on May 31, 2007.

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Interest on the New Principal Amount of the A Notes and B Notes will accrue at a rate of 8.0% per annum and will be payable quarterly in arrears on May 31, August 31, November 30, and February 28 of each year commencing upon issuance. We will pay interest to those persons who were holders of record of the A Notes and B Notes on May 15, August 15, November 15 and February 15 immediately preceding each interest payment date.

The A Notes will be prepayable at any time by us without penalty or premium. The B Notes will be prepayable by us only on or after ________, 200_ (12 months from date of issuance) except with the prior consent of the holder.

Conversion of A Notes and B Notes

From the date of issuance until the expiration of the Offering Period, the A Notes will be convertible in whole or in part into shares of our Common Stock at a conversion rate of one share per $.96 of New Principal Amount of the A Notes. Thereafter, the A Notes will no longer be convertible into shares of our Common Stock.

From 12 months from the date of issuance until May 31, 2007, the date of maturity, the B Notes will be convertible in whole or in part into shares of our Common Stock at a conversion rate of one share per $.96 of New Principal Amount of the B Notes.

Prior to a payment of any New Principal Amount of the A Notes or B Notes by us, holders will be provided with thirty (30) days written notice in the event that they wish to and have a right to convert their A Notes or B Notes into shares of Common Stock prior to such payment. The B Notes will not be prepayable by us prior to 12 months from the date of issuance, except with the prior consent of the holder.

The conversion of each $.96 of New Principal Amount of the A Notes or B Notes into shares of our Common Stock decreases the New Principal Amount of the A Notes or the B Notes, as the case may be, by $.96 as of the date of conversion.

Security for Repayment of the A Notes and B Notes

The repayment of the principal and any accrued but unpaid interest pursuant to the A Notes and B Notes will be secured by a first priority security interest in our intellectual property granted pursuant to a security agreement entered into by us and CrossHill Georgetown Capital, LP, the designated agent of the holders of Notes and the holder of $750,000 Principal Amount of the Notes (the “Note Agent”). Upon the payment or conversion of $5,000,000 of the total principal amount and of the Notes, A Notes and B Notes, or upon the substitution of $5,000,000 in cash collateral by us for the benefit of the note holders, our XML patents will be released from such security interest. If after substitution of such cash collateral for the XML Patents, we notify the Note Agent in writing of the conversion into shares of our Common Stock and/or repayment of any or all of the principal amount of the Notes, A Notes and B Notes, the Note Agent will, after review of the evidence of such conversion and/or repayment, release a pro rata portion of such cash collateral being held to us based upon the portion of the principal amount of such Notes, A Notes and B Notes so converted and/or repaid. This procedure may not occur more often than once every 30 day period.

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Shares of Common Stock Issued Upon Conversion of A Notes or B Notes

Shares of our Common Stock issued upon conversion of the A Notes will be freely tradable. Shares of our Common Stock issued upon conversion of the B Notes will be “restricted securities” as defined in Rule 144 under the Securities Act. However, if you purchased your Notes at least two years prior to your conversion, you may be able to sell the shares issued upon the conversion under Rule 144(k) under the Securities Act if you are not otherwise an affiliate of Scientigo.

Restrictions on Transfers of A Notes or B Notes

The A Notes will be freely transferable. The B Notes will be transferable only to “accredited investors” as defined under the Securities Act.

 

Terms of the A Warrants and B Warrants

Exercise Price

From the date of issuance until the expiration of the Offering Period, the A Warrants will be exercisable in whole or in part at $.85 cash per share of our Common Stock. From 12 months from the date of issuance, through June 30, 2010, the B Warrants will be exercisable in whole or in part at $1.00 cash per share of our Common Stock.

Term

The A Warrants will be exercisable until the expiration of the Offering Period, at which point they will terminate. The B Warrants will be exercisable from 12 months from date of issuance until June 30, 2010.

Termination of B Warrants

For each A Warrant you exercise, one B Warrant will terminate. If all A Warrants are exercised, all B Warrants will terminate.

Shares of Common Stock Issued Upon Exercise of A Warrants or B Warrants

Shares of our Common Stock issued upon exercise of the A Warrants will be freely tradable because their issuance will be registered pursuant to the registration statement of which this prospectus is a part. Shares of our Common Stock issued upon exercise of the B Warrants will be subject to restrictions on their resale because they will not be issuable until after the registration statement of which this prospectus is a part will no longer be effective.

Restrictions on Transfers of A Warrants or B Warrants

The A Warrants will be freely transferable. The B Warrants will be transferable only to “accredited investors” as defined under the Securities Act.

 

Differences in Rights of Securities Offered

A Notes and B Notes Compared to Notes

The original purchase price for the Notes was 80% of the Principal Amount of the Notes. Because of adverse income tax consequences that would occur upon acceptance of the Exchange Offer to the Note holders if the A Notes and the B Notes had the same Principal Amounts as the Notes, the A Notes and the B Notes offered in exchange for the Notes have a principal amount equal to the original purchase price paid by Note holders (the “New Principal Amount”). If a Note holder accepted the Exchange Offer and did not convert his A Notes or B Notes into shares of our Common Stock prior to maturity, he would be entitled to receive a principal payment equal to his original cash purchase price of the Notes. Conversely, if a Note holder does not accept the Exchange Offer and does not convert his Notes into shares of Common Stock prior to maturity, he would be entitled to receive at maturity a principal payment equal to his original cash payment plus the original issue discount on the Notes. The original issue discount on the Notes was $.20 for every $.80 invested.

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The Notes are convertible into shares of our Common Stock at a conversion rate of one share of Common Stock for each $1.3325 Principal Amount of Notes surrendered for conversion for a term ending May 31, 2007. The A Notes are convertible into shares of our Common Stock at a conversion rate of one share of Common Stock for each $.96 New Principal Amount of A Notes surrendered for conversion on or before the expiration of the Offering Plan. Thereafter, the A Notes are no longer convertible into shares of our Common Stock. Beginning 12 months from the consummation of the Exchange Offer, the B Notes are convertible into shares of our Common Stock at a conversion rate of one share of Common Stock for each $.96 New Principal Amount of B Notes surrendered for conversion on or before May 31, 2007. Without the prior consent of the holder, the B Notes are prepayable by us only during the period that the B Notes are convertible into shares of our Common Stock. Other than these differences, the terms of the Notes, the A Notes and the B Notes including the rate and timing of quarterly interest payments and the security for the repayment of all notes are the same.

A Notes compared to B Notes.

If you accept the Exchange Offer, you may elect to receive either all A Notes or all B Notes. All terms of the A Notes and B Notes (principal, maturity, interest rate, interest payments, security for repayment and conversion rate) are the same except, as described above, (i) the period of time during which the A Notes and B Notes are convertible into shares of Common Stock varies, (ii) without the holder’s prior consent, the B Notes are not prepayable by us while such B Notes are not convertible into shares of Common Stock, (iii) the shares of Common Stock issued upon the conversion of the A Notes will be freely tradable, while the shares of Common Stock issued upon the conversion of the B Notes will be restricted securities, and (iv) the A Notes will be freely transferable while the B Notes will only be transferable to accredited investors.

A Warrants and B Warrants compared to Warrants. The A Warrants and B Warrants offered by us in exchange for the Warrants have the following differences in terms:

·   If you accept the Exchange Offer, you will receive 1.1748 A Warrants and one (1) B Warrant for each Warrant you properly tender for exchange.

·   From the date of issuance until the expiration of the Offering Period, the A Warrants will be exercisable in whole or in part at $.85 cash per share of our Common Stock. From 12 months from the date of issuance, through June 30, 2010, the B Warrants will be exercisable in whole or in part at $1.00 cash per share of our Common Stock. For each A Warrant you exercise, one B Warrant will terminate. If all A Warrants are exercised, all B Warrants will terminate.

·   The Warrants are exercisable in whole or in part at $1.00 cash per share of our Common Stock from their date of issuance until June 30, 2010.

Shares of our Common Stock issued upon exercise of the A Warrants will be freely tradable. Shares of our Common Stock issued upon exercise of the B Warrants will subject to restrictions on their resale. Shares of our Common Stock issued upon the exercise of the Warrants will be freely tradable if exercised on or prior to the expiration of the Offering Period, and thereafter, such shares will be subject to restrictions on their resale if such Warrants are exercised after such date. A Warrants will be freely transferable. B Warrants will be transferable only to accredited investors.

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Purposes of the Exchange Offer; Certain Effects of the Exchange Offer

Purposes of the Exchange Offer

In determining to proceed with the Exchange Offer, our Board of Directors has reviewed, with the assistance of management, its strategic plan and its capital requirements in order to continue its on-going efforts to license, sell or otherwise transfer for value its intellectual property portfolio. In such regard, the Board of Directors has reviewed, with the assistance of management, the desirability of providing incentives to its holders of Notes and Warrants who did not accept the Rescission Offer to (1) convert their notes, which bear interest, are repayable in full on May 31, 2007, and are secured by our intellectual property portfolio, for shares of our Common Stock, which do not accrue dividends or interest, are not redeemable and are junior to the Notes in liquidation preference, and (2) exercise their warrants, which will provide additional capital to us. As a result, our Board of Directors approved the terms of the Exchange Offer which allow the holders of Notes and Warrants who did not accept the Rescission Offer to convert and exercise their A Notes and A Warrants received in the Exchange Offer, respectively, upon more favorable terms and if converted and/or exercised on or prior to the expiration of the Offering Period, to receive a greater number of shares of our Common Stock which are also freely tradable than if they had not accepted the Exchange Offer.

Such earlier conversions and exercises will reduce our indebtedness and interest costs (with respect to the A Notes) and generate additional capital (upon the exercise of A Warrants), both at an earlier point in time. Additionally, if such conversions and exercises occur while the registration statement of which this prospectus is a part is effective, the shares of our Common Stock issued upon such conversions and exercises will be freely tradeable, thus potentially providing increased liquidity to our Note and Warrant holders.

An additional purpose of the Exchange Offer is to increase the number of shares of our Common Stock outstanding, and thereby increase the potential for more significant trading volume in our Common Stock.

OUR BOARD OF DIRECTORS HAS APPROVED THE EXCHANGE OFFER. HOWEVER, NEITHER WE NOR OUR BOARD OF DIRECTORS MAKE ANY RECOMMENDATION TO YOU AS TO WHETHER YOU SHOULD TENDER OR REFRAIN FROM TENDERING YOUR NOTES AND WARRANTS. YOU MUST MAKE YOUR OWN DECISION AS TO WHETHER TO TENDER YOUR NOTES AND WARRANTS. YOU SHOULD READ CAREFULLY THE INFORMATION IN THIS PROSPECTUS AND IN THE RELATED LETTER OF TRANSMITTAL, INCLUDING OUR REASONS FOR MAKING THE EXCHANGE OFFER.

Our Chairman of the Board of Directors, a limited partnership (of which our Chairman is a member of the limited liability company which is the general partner), and our Chief Operations Officer, hold an aggregate of $1,018,750 principal amount of Notes and 509,375 Warrants, and are eligible to participate in the Rescission Offer. We have been advised that they do not intend to accept the Rescission Offer. We have also been advised that they intend to accept the Exchange Offer.

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Potential Benefits of the Exchange Offer. We believe the Exchange Offer will provide benefits to us and our security holders, including the following:

·   The holders of the Notes are presently able to convert their Notes at a conversion rate of one share of our Common Stock for each $1.3325 Principal Amount of such Notes. If such holders accept the Exchange Offer, they will have more incentive to convert their A Notes or B Notes because they will be able to receive more shares of our Common Stock upon such conversion. While such conversion does not provide us with additional capital, it will decrease our indebtedness and reduce our interest payment obligations under the A Notes and B Notes, thereby increasing our ability to raise additional capital in the future and reducing our cash requirements for interest payments.

·   The holders of the Warrants are presently able to exercise their Warrants at an exercise price of $1.00 per share of our Common Stock. If such holders accept the Exchange Offer, they will have more incentive to exercise their A Warrants prior to the expiration of the Offering Period, because they will be able to receive more shares of our Common Stock upon such exercise, both because they will receive a greater number of such A Warrants and will have a lower exercise price of $.85 per share. The exercise of the A Warrants, if any, may provide us with greater capital at an earlier time than under the terms of the Warrants.

·   The increase in the number of shares of our Common Stock outstanding upon the successful completion of the Exchange Offer and upon the conversion of A Notes and B Notes and the exercise of A Warrants or B Warrants could increase the "public float," which is the number of our shares of Common Stock owned by non-affiliate stockholders and available for trading in the securities markets. This could help minimize the volatility of the trading of our Common Stock because such stock is currently very thinly-traded in the OTC Bulletin Board market.

Potential Disadvantages of the Exchange Offer. The Exchange Offer also presents some potential disadvantages to us and our security holders, including the following:

·   The acceptance of the Exchange Offer will shorten the period of time for the holders of A Warrants to exercise their warrants from June 30, 2010 to the expiration of the Offering Period, unless such holders do not exercise such A Warrants. If the holders of such A Warrants accept the Exchange Offer, but do not exercise such A Warrants prior to the expiration of the Offering Period, the holder of such A Warrants will no longer have a right to exercise their A Warrants and receive an increased number of shares of our Common Stock at a more favorable exercise price. They will, however, continue to hold their B Warrants which will be exercisable at $1.00 per share from 12 months from date of issuance until June 30, 2010.

·   The future conversion of the A Notes and B Notes, and the exercise of A Warrants and B Warrants, if any, following the successful completion of the Exchange Offer will dilute the ownership by other holders of our Common Stock. The conversion of the A Notes and B Notes will not provide any additional capital to us. While the exercise of A Warrants and B Warrants will provide additional capital for us, the exercise prices of $.85 and $1.00 per share, respectively, are below the recent trading range of our Common Stock.

·   If a Note holder accepted the Exchange Offer and did not convert his A Notes or B Notes into shares of our Common Stock prior to maturity, he would be entitled to receive at maturity a principal payment equal to his $.80 discounted New Principal Amount. If a Note holder does not accept the Exchange Offer and does not convert his Notes into shares of our Common Stock prior to maturity, he would be entitled to receive at maturity the original $1.00 Principal Amount of his Note.

·   Holders of Notes and Warrants who accept the Exchange Offer, particularly those who elect to receive A Notes, will have more incentive to convert their A Notes and exercise their A Warrants prior to the expiration of the Offering Period. The conversion of A Notes and exercise of A Warrants will increase the number of shares of our Common Stock which may be sold into the public market. The incentive to sell shares into the public market may be greater with respect to shares issued upon the exercise of A Warrants, which require cash to pay the exercise price of such Warrants, as compared to shares issued upon conversion of A Notes, which do not require the payment of cash. An increase in the number of shares sought to be sold into the public market could adversely impact the trading price of our Common Stock.

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Certain Effects of the Exchange Offer. Holders of the Notes and Warrants who choose not to accept the Exchange Offer will continue to have the same rights as set forth in the terms of such Notes and Warrants at the time of their issuance. See “Description of Capital Securities.” Holders of the Notes and Warrants who choose to accept the Exchange Offer will have rights as set forth in the terms of the A Notes or B Notes, and A Warrants and B Warrants as described at “- Terms of the A Notes and B Notes” and “- Terms of the A Warrants and B Warrants” above.

We will continue to be a reporting company under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) following the successful completion of the Exchange Offer.

Procedures for Tendering Notes and Warrants

Proper Tender of Notes and Warrants

For Notes and Warrants to be tendered properly pursuant to the Exchange Offer:

·   The instruments evidencing the Notes and Warrants (the “Instruments”), together with a properly completed and duly executed Letter of Transmittal, including any required signature guarantees, and any other documents required by the Letter of Transmittal, must be received before 12:00 Midnight, New York City time, on __________, 200_ (the “Exchange Offer Expiration Date”), by the Exchange Agent at its address set forth in the Letter of Transmittal.

·   The Letter of Transmittal must contain your election of the issuance of either an A Note or a B Note pursuant to the terms of the Exchange Offer.

Notwithstanding any other provisions hereof, the issuance of A Notes or B Notes and A Warrants and B Warrants for Notes and Warrants tendered and accepted pursuant to the Exchange Offer will be made only after timely receipt by the Exchange Agent of the Instruments, a properly completed and duly executed Letter of Transmittal (or facsimile thereof) with any required signature guarantees, and any other documents required by the Letter of Transmittal.

Method of Delivery

The method of delivery of all documents, including Instruments, is at the election and risk of the tendering holder. If delivery is by mail, registered mail with return receipt requested, properly insured, is recommended. Notes and Warrants will be deemed delivered only when actually received by the Exchange Agent. In all cases, sufficient time should be allowed to ensure timely delivery.

Signature Guarantees

Signatures on the Letter of Transmittal need not be guaranteed: (a) if the Letter of Transmittal is signed by the registered holder(s) of the Instruments transmitted with the Letter of Transmittal and such holder(s) has (have) not completed the instruction entitled "Special Issuance Instructions" and/or "Special Delivery Instructions" on the Letter of Transmittal; or (b) if such Instruments are transmitted for the account of an Eligible Institution (defined below). In all other cases, all signatures on the Letter of Transmittal must be guaranteed by a financial institution (including most banks, savings and loan associations and brokerage houses) that is a participant in the Securities Transfer Agents Medallion Program, the New York Stock Exchange Medallion Signature Program or the Stock Exchange Medallion Program (each of the foregoing constituting an "Eligible Institution"). If an Instrument is registered in the name of a person other than the person executing the Letter of Transmittal, then the Instrument must be accompanied by an appropriate power of attorney, in either case signed exactly as the name of the registered holder appears on the Instruments, with the signature guaranteed by an Eligible Institution.

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Federal Income Tax Backup Withholding

Under the federal income tax backup withholding rules, 28% of the value of the notes and warrants issued to the holder pursuant to the Exchange Offer may have to be withheld and remitted to the United States Treasury, unless the holder provides his or her taxpayer identification number (employer identification number or social security number) to the Exchange Agent and certifies that such number is correct or an exemption otherwise applies under applicable regulations. Therefore, unless such an exemption exists and is proven in a manner satisfactory to the Exchange Agent, each tendering holder should complete and sign the Substitute Form W-9 included as part of the Letter of Transmittal so as to provide the information and certification necessary to avoid backup withholding. Certain holders (including, among others, all corporations) are not subject to these backup withholding and reporting requirements.

Tender Constitutes An Agreement

The tender of the Notes and Warrants pursuant to any one of the procedures described above will constitute the tendering holder's (i) acceptance of the terms and conditions of the Exchange Offer and an agreement between the tendering holder and us upon the terms of the Exchange Offer, and (ii) rejection of the Rescission Offer. See “Rescission Offer - Rejection or Failure to Affirmatively Accept.” 

Determination of Validity; Rejection of Notes and Warrants; Waiver of Defects; No Obligation to Give Notice of Defects

All questions as to the form of documents and the validity, eligibility (including time of receipt) and acceptance for issuance of A Notes or B Notes and A Warrants and B Warrants upon any tender of Notes and Warrants will be determined by us, in our sole discretion, which determination shall be final and binding on all parties. We reserve the absolute right to reject any or all tenders of Notes and Warrants determined by us not to be in proper form, or the acceptance of which or issuance of A Notes or B Notes and A Warrants and B Warrants for which may, in the opinion of our counsel, be unlawful. We also reserve the absolute right to waive any defect or irregularity in any tender of particular Notes and Warrants, and our interpretation of the terms of the Exchange Offer (including the instructions in the Letter of Transmittal) will be final and binding on all parties. No tender of Notes and Warrants will be deemed to be properly made until all defects and irregularities have been cured or waived. Unless waived, any defects or irregularities in connection with tenders must be cured within such time as we shall determine. None of us, the Exchange Agent or any other person will be under any duty to give notification of any defect or irregularity in tenders or incur any liability for failure to give any such notification.

Return of Withdrawn Notes and Warrants

If any tendered Notes and Warrants are properly withdrawn before the Exchange Offer Expiration Date, instruments for such Notes and Warrants will be returned promptly after the expiration or termination of the Exchange Offer or the proper withdrawal of the Notes and Warrants, as applicable, in each case without expense to the holder.

Lost or Destroyed Instruments

In the event that your Instruments have been lost, stolen or destroyed, please indicate this on the face of the Letter of Transmittal. The Exchange Agent will forward you additional documentation that you must complete in order to effectively surrender lost, stolen or destroyed Instruments, including an affidavit of the fact that such instruments have been lost, stolen or destroyed. A surety bond may be required.

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Withdrawal Rights

Tenders of Notes and Warrants made pursuant to the Exchange Offer may be withdrawn at any time prior to the Exchange Offer Expiration Date, unless we extend such Exchange Offer Expiration Date in which event Notes and Warrants tendered may be withdrawn until 12:00 Midnight, New York City time, on such extended Exchange Offer Expiration Date. For a withdrawal to be effective, a written, or facsimile transmission, notice of withdrawal must both:

·   be timely received by the Exchange Agent at its address set forth in the Letter of Transmittal;

·   specify the name of the person who tendered the Notes and Warrants to be withdrawn and the name of the registered holder of the Notes and Warrants, if different from that of the person who tendered such Notes and Warrants; and

·   comply with the same signature guaranty procedures, if applicable, described above at “ - Signature Guarantees.”

The tender of Notes and Warrants constitutes a rejection of the Rescission Offer. See “Rescission Offer - Rejection or Failure to Affirmatively Accept.” If you desire to accept the Rescission Offer, despite your earlier rejection effected by tendering your Notes and Warrants, you must withdraw your tender in accordance with the procedures described in this section, and submit your acceptance of the Rescission Offer to Scientigo in accordance with the procedures described at “Rescission Offer - Acceptance” prior to the Rescission Offer Expiration Date (which is ___________, 2006). The Rescission Offer and the Exchange Offer expire on the same date, unless the Exchange Offer is extended.

Withdrawals may not be rescinded, and Notes and Warrants withdrawn will thereafter be deemed not validly tendered for purposes of the Exchange Offer. However, withdrawn Notes and Warrants may be retendered by again following one of the procedures described at “- Procedures for Tendering Notes and Warrants” above at any time prior to the Exchange OfferExpiration Date.

We will determine all questions as to the form and validity (including time of receipt) of any notice of withdrawal, in our sole discretion, which determination shall be final and binding. We also reserve the absolute right to waive any defect or irregularity in the withdrawal of Notes and Warrants by any holder, and such determination will be binding on all holders. None of us, the Exchange Agent or any other person will be under any duty to give notification of any defect or irregularity in any notice of withdrawal or incur any liability for failure to give any such notification.

Acceptance of Tendered Notes and Warrants and Issuance of A Notes, B Notes, A Warrants and B Warrants

Upon the terms and subject to the conditions of the Exchange Offer, promptly following the Exchange Offer Expiration Date, we will give the Exchange Agent oral or written notice of acceptance of all Notes and Warrants properly tendered and not properly withdrawn before the Exchange Offer Expiration Date. Thereafter, we will issue the A Notes or B Notes, and A Warrants and B Warrants which will be delivered in accordance with the instructions set forth in the Letter of Transmittal.

Price Range of the Notes and Warrants

The Notes and Warrants are not, and the A Notes, B Notes, A Warrants and B Warrants will not be, listed on any exchange and there is no established trading market for such Notes and Warrants, nor will there be an established trading market for the A Notes, B Notes, A Warrants or B Warrants. Our Common Stock trades on the OTC Bulletin Board, under the symbol "MKTE.OB."

On _______, 2005, the last trading day before the date of announcement of the Rescission Offer and the Exchange Offer, the last reported sale price of the shares on the OTC Bulletin Board was $____ per share. We urge stockholders to obtain current market quotations for the shares before deciding whether to tender their Notes and Warrants.

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Interest of Directors and Executive Officers; Transactions and Arrangements Concerning the Notes and Warrants

Our Chairman of the Board of Directors, a limited partnership (of which our Chairman is a member of the limited liability company which is the general partner), and our Chief Operations Officer, hold an aggregate of $1,018,750 Principal Amount of Notes and 509,375 Warrants, and are eligible to participate in the Rescission Offer. We have been advised that they do not intend to accept the Rescission Offer. We have also been advised that they intend to accept the Exchange Offer.

We have agreed to pay fees to Jones Byrd & Attkisson, Inc. (the “Placement Agent”), if allowed by applicable state law, in the event that following completion of the Exchange Offer, (i) holders of A Notes or B Notes elect to convert such notes into shares of our Common Stock (in the amount of 6% of the New Principal Amount of A Notes and B Notes converted), or (ii) holders of A Warrants and B Warrants exercise such warrants (in an amount equal to 10% of the aggregate exercise price of such warrants exercised). Ronald L. Attkisson, a director of Scientigo, is a principal of the Placement Agent. Cynthia S. White, our Chief Operations Officer, is the Financial Operating Principal and CFO for the Placement Agent. Ms. White will end that consulting arrangement at such time that the Placement Agent transitions her position to her successor.

Legal Matters; Regulatory Approvals

We are not aware of any license or regulatory permit that appears material to our business that might be adversely affected by our acquisition of the Notes and Warrants as contemplated by the Exchange Offer or of any approval or other action by any government or governmental, administrative or regulatory authority or agency, domestic, foreign or supranational, that would be required for our acquisition of the Notes and Warrants as contemplated by the Exchange Offer. Should any such approval or other action be required, we presently contemplate that we will seek that approval or take such other action. We are unable to predict whether we will be required to delay the acceptance for payment of or payment for Notes and Warrants tendered pursuant to the Exchange Offer pending the outcome of any such matter.

We are not aware of any pending or threatened legal proceedings that would affect the Exchange Offer.

Extension of the Exchange Offer; Termination; Amendment

We expressly reserve the right, in our sole discretion, at any time and from time to time, to extend the period of time during which the Exchange Offer is open and thereby delay acceptance for exchange of, and issuance of A Notes or B Notes, and A Warrants and B Warrants for Notes and Warrants, by making a public announcement of such extension.

Subject to compliance with applicable law, we further reserve the right, in our sole discretion, to amend the Exchange Offer in any respect, including, without limitation, by decreasing or increasing the consideration offered in the Exchange Offer to holders of Notes and Warrants or by decreasing the amount or number of Notes and Warrants being sought in the Exchange Offer. Amendments to the Exchange Offer may be made at any time and from time to time effected by public announcement, such announcement, in the case of an extension, to be issued no later than 9:00 a.m., New York City time, on the next business day after the last previously scheduled or announced Exchange Offer Expiration Date. Any public announcement made pursuant to the Exchange Offer will be disseminated promptly to holders in a manner reasonably designed to inform holders of such change. Without limiting the manner in which we may choose to make a public announcement, except as required by applicable law, we shall have no obligation to publish, advertise or otherwise communicate any such public announcement other than by making a release through PRnewswire or another comparable service.

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The Exchange Offer is not conditioned on any minimum amount or number of Notes and Warrants being tendered or any other condition other than the proper tender of your Notes and Warrants.

In the event that there is a material change in the information set forth in the Exchange Offer, we will be required to extend the Exchange Offer so that at least five (5) business days remain in the Exchange Offer period after the information is provided to you.

Fees and Expenses

We are responsible for all fees and expenses of the Exchange Agent.

We will not pay any fees or commissions to brokers or dealers for soliciting tenders of Notes and Warrants pursuant to the Exchange Offer. Holders holding Notes and Warrants through brokers or banks are urged to consult the brokers or banks to determine whether transaction costs are applicable if holders tender Notes and Warrants through such brokers or banks and not directly to the Exchange Agent. No broker, dealer, commercial bank or trust company has been authorized to act as the agent of us or the Exchange Agent for purposes of the Exchange Offer. We will pay or cause to be paid all domestic transfer taxes applicable to the Exchange Offer.

If you hold your Notes and Warrants through a broker, bank or other nominee and your broker tenders Notes and Warrants on your behalf, your broker may charge you a fee for doing so. We urge you to consult your broker or nominee to determine whether any charges will apply.

If you accept the Exchange Offer and later exercise your A Warrants or B Warrants and/or convert your A Notes or B Notes, you will not be required to pay fees or other costs on the issuance of shares of Common Stock to you. However, we have agreed to pay fees to the Placement Agent, if allowed by applicable state law, in the event that you accept the Exchange Offer and after issuance of the A Notes or B Notes, and the A Warrants and B Warrants, elect to convert your notes into shares of our Common Stock (in the amount of 6% of the New Principal Amount of such A Notes and B Notes converted), or to exercise your A Warrants or B Warrants (in an amount equal to 10% of the aggregate exercise price of the A Warrants and B Warrants exercised). This will not, however, affect your rights as a holder of A Notes or B Notes, and A Warrants and B Warrants or in any way limit the number of shares of our Common Stock that you receive upon such conversion or exercise. One of our directors is a principal of the Placement Agent.

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Transfer Taxes

We will pay all transfer taxes, if any, applicable to the exchange of outstanding Notes and Warrants under the Exchange Offer.

Accounting Treatment

The A Notes, B Notes, A Warrants and B Warrants may be recorded at a different carrying value than the Notes and Warrants on the date of the exchange. The difference will result from a change in the discount attributable to the beneficial conversion feature of the A Notes and the B Notes and to the value attributable to the A Warrants and B Warrants. This will not result in a gain or loss for accounting purposes on the date of exchange.  The expenses of the Exchange Offer and the expenses relating to the issuance of the A Notes, B Notes, A Warrants and B Warrants will be expensed on the date of exchange.

Miscellaneous

We are not aware of any jurisdiction where the making of the Exchange Offer is not in compliance with applicable law. If we become aware of any jurisdiction where the making of the Exchange Offer or the acceptance of Notes and Warrants pursuant thereto is not in compliance with applicable law, we will make a good faith effort to comply with the applicable law. If, after such good faith effort, we cannot comply with the applicable law, the Exchange Offer will not be made to (nor will tenders be accepted from or on behalf of) the holders of Notes and Warrants in such jurisdiction.

We have not authorized any person to make any recommendation on our behalf as to whether you should tender or refrain from tendering your Notes and Warrants in the Exchange Offer. You should rely only on the information contained in this prospectus or in the related Letter of Transmittal. We have not authorized any person to give any information or to make any representations in connection with the Exchange Offer other than those contained in this prospectus or in the related Letter of Transmittal. If anyone makes any recommendation or representation to you or gives you any information, you must not rely on that recommendation, representation or information as having been authorized by us.

Questions or requests for assistance may be directed to the Exchange Agent at its telephone numbers and address set forth below. Stockholders may also contact their broker, dealer, commercial bank or trust company for assistance concerning the Exchange Offer.

The Exchange Agent for the Exchange Offer is:

Greenberg Traurig, LLP

Suite 400

3290 Northside Parkway

Atlanta, GA 30327

Attention: Gerald L. Baxter

678-553-2100

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CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS

The following general discussion describes certain U.S. federal income tax considerations with respect to the Rescission Offer and the Exchange Offer and with respect to the ownership and disposition of the A Notes and the B Notes (referred to in this section as the “New Notes”), the A Warrants and the B Warrants (referred to in this section as the “New Warrants”) and shares of Common Stock acquired on the conversion of New Notes or the exercise of New Warrants. The U.S. federal income tax consequences to a holder of Notes (referred to in this section as the “Old Notes”), Warrants (referred to in this section as the “Old Warrants”) or shares of Common Stock acquired on the conversion of Old Notes or the exercise of Old Warrants who does not accept the Rescission Offer or the Exchange Offer should be the same as those that would apply had neither the Rescission Offer nor the Exchange Offer been made.

This discussion is based upon the Internal Revenue Code of 1986, as amended, referred to hereafter as the “Code”, Treasury regulations, Internal Revenue Service, or IRS, rulings and pronouncements and judicial decisions now in effect, each of which is subject to change at any time by legislative, administrative or judicial action, possibly with retroactive effect. This discussion does not address every aspect of U.S. federal income taxation that may be relevant to a particular taxpayer in light of its individual circumstances or to persons who are otherwise subject to special tax treatment. For example, special rules not discussed here may apply to you if you are:

·   a bank or other financial institution;

·   a broker-dealer;

·   an insurance company;

·   a regulated investment company, real estate investment trust or real estate mortgage investment conduit;

·   a pension or other employee benefit plan;

·   a tax-exempt organization or entity;

·   a U.S. expatriate;

·   a person holding Notes, Warrants or Common Stock as a part of a “straddle,”“hedge” or “conversion transaction” with other investments;

·   a person who has elected mark-to-market accounting;

·   a hybrid entity or an owner of an interest therein;

·   a holder whose functional currency is not the U.S. dollar; or

·   a person other than a U.S. Holder, as defined below.

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In addition, this discussion applies only to a holder in connection with Old Notes or Old Warrants that the holder acquired on original issuance at the issue price. Thus, for example, this discussion describes (1) the U.S. federal income tax consequences of an exchange of Old Notes or Old Warrants or shares of Common Stock acquired on the conversion of Old Notes or the exercise of Old Warrants for cash pursuant to the Rescission Offer, (2) the U.S. federal income tax consequences of an exchange of Old Notes or Old Warrants for New Notes or New Warrants pursuant to the Exchange Offer, and (3) the U.S. federal income tax consequences of the ownership and disposition of (a) New Notes or New Warrants acquired in the Exchange Offer in exchange for Old Notes or Old Warrants and (b) shares of Common Stock acquired on the conversion of New Notes or the exercise of New Warrants. In addition, this discussion applies only to Old Notes, Old Warrants, New Notes, New Warrants or shares of Common Stock that are held as capital assets within the meaning of section 1221 of the Code.

We have not sought and do not intend to seek any rulings from the IRS regarding the tax consequences described below, and, accordingly, there is no assurance that the IRS will not successfully challenge any of those tax consequences. Moreover, this discussion does not address the effect of any applicable foreign, state, local or other tax laws. We urge you to consult your tax adviser with respect to the U.S. federal income tax consequences of the Rescission Offer and the Exchange Offer and the U.S. federal income tax consequences of the acquisition, ownership and disposition of New Notes, New Warrants and shares of Common Stock as well as any tax considerations applicable under the law of any foreign, state, local or other taxing jurisdiction.

This discussion describes only the U.S. federal income tax consequences to a U.S. Holder. You are a U.S. Holder if you are the beneficial owner of an Old Note or a New Note, an Old Warrant or a New Warrant or a share of Common Stock acquired on conversion of an Old Note or a New Note or on exercise of an Old Warrant or a New Warrant or on a transfer to you pursuant to the Exchange Offer, and you are:

·   a citizen or resident alien individual of the United States,

·   a corporation, or an entity treated as a corporation, organized under the law of the United States, any State thereof or the District of Columbia,

·   an estate the income of which is subject to U.S. federal income tax without regard to its source or

·   a trust if (1) a court within the United States is able to exercise primary supervision over the administration of the trust, and one or more United States persons have the authority to control all substantial decisions of the trust, or (2) the trust was in existence on August 20, 1996 and properly elected to continue to be treated as a United States person.

If a partnership, including for this purpose any entity treated as a partnership for U.S. federal income tax purposes, is a beneficial owner of an Old Note or a New Note, an Old Warrant or a New Warrant or a share of Common Stock, the U.S. federal income tax treatment of a partner in the partnership generally will depend on the status of the partner and the activities of the partnership. A holder that is a partnership, and partners in that partnership, should consult their own tax advisers regarding their U.S. federal income tax consequences.

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Tax Consequences of the Rescission Offer

Although it is not free from doubt, for U.S. federal income tax purposes, the exchange by a U.S. Holder of an Old Note, an Old Warrant or a share of Common Stock for cash pursuant to the Rescission Offer should be a taxable exchange, although an alternative characterization, discussed in “—Tax Consequences of the Rescission Offer—General” below, is possible.

The Notes

If the exchange of an Old Note for cash pursuant to the Rescission Offer is a taxable exchange, a U.S. Holder will recognize short-term capital gain or loss in an amount equal to the difference between the amount of cash received for the Old Note, other than any portion that constitutes interest, and the U.S. Holder’s adjusted tax basis in the Old Note. The U.S. Holder’s adjusted tax basis in the Old Note should be equal to its original tax basis in the Old Note increased by the amount of original issue discount, or OID, that accrued on the Old Note while the U.S. Holder owned the Old Note and that the U.S. Holder included in gross income.

The Old Notes and Old Warrants were originally issued as investment units, each of which consisted of an Old Note and an Old Warrant. The original tax basis in each Old Note and Old Warrant was equal to its allocable share of the issue price of the investment unit. The issue price of each investment unit was the price at which a substantial number of investment units was sold. That issue price will be allocated between the Old Note and the Old Warrant comprising part of the investment unit based on their relative fair market values. We have not yet allocated the issue price of the investment units between the Old Note and the Old Warrant, but we intend to make that allocation and to advise holders of our determination. Our allocation is not binding on the IRS, which may challenge the allocation. However, a U.S. Holder is bound by our allocation unless the U.S. Holder explicitly discloses in a timely filed U.S. federal income tax return of the U.S. Holder for the taxable year in which it acquired the investment unit that it intends to use an allocation that is inconsistent with our allocation.

A U.S. Holder’s original tax basis in an Old Note will be increased by the amount of any OID that accrues on the Old Note while the U.S. Holder owns the Old Note and that the U.S. Holder included in gross income. The Old Notes will be treated as having been issued with OID because they were issued at a substantial discount from their principal amount payable at maturity by virtue of having been issued as part of investment units. The amount of the OID is equal to the excess of the “stated redemption price at maturity” over the “issue price” of the Old Note. Based on our allocation, the “issue price” of an Old Note is equal to 80% of its face amount on its issue date. The “stated redemption price at maturity” is the sum of all payments to be made on an Old Note other than “qualified stated interest”. The term “qualified stated interest” means, generally, stated interest that is unconditionally payable at least annually at a single fixed or variable rate. Because interest is paid on the Old Notes quarterly at a single fixed rate, all of the interest paid onthe Old Notes will be qualified stated interest. Accordingly, the stated redemption price at maturity of the Old Notes should be the stated principal amount of the Old Notes.

A U.S. Holder of an Old Note, in general, must include OID in income on a constant-yield accrual method, as prescribed by Treasury regulations, in advance of the receipt of some or all of the related cash payments. The amount of OID included in income by an initial U.S. Holder of an Old Note is the sum of the “daily portions” of OID with respect to that Old Note for each day during the taxable year or portion of the taxable year in which the U.S. Holder holds the Old Note. This amount is referred to as “accrued OID”. The daily portion is determined by allocating to each day in any accrual period a pro rata portion of the OID allocable to that accrual period. The accrual period for the Old Notes may be of any length selected by the U.S. Holder and may vary in length over the term of the Old Notes, provided that each accrual period is no longer than one year, and each scheduled payment of principal or interest occurs on the first day or the final day of an accrual period. The amount of OID allocable to any accrual period is equal to:

·   the product of the Old Note’s adjusted issue price at the beginning of the accrual period and the Old Note’s yield to maturity, determined on the basis of compounding at the close of each accrual period, properly adjusted for the length of the accrual period, over

·   the qualified stated interest allocable to the accrual period.

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Special rules will apply in calculating OID for an initial short accrual period. The “adjusted issue price” of an Old Note at the beginning of any accrual period is equal to its issue price increased by the accrued OID for each prior accrual period and reduced by any payments other than qualified stated interest made on the Old Note on or before the first day of the accrual period. OID allocable to the final accrual period is the difference between the amount payable at maturity of the Old Note and the Old Note’s adjusted issue price at the beginning of the final accrual period.

The Warrants

A U.S. Holder will recognize short-term capital gain or loss in an amount equal to the difference between the amount of cash received in respect of an Old Warrant pursuant to the Rescission Offer, other than any portion that constitutes interest, and the U.S. Holder’s adjusted tax basis in the Old Warrant. The U.S. Holder’s basis in an Old Warrant will be determined in the manner described above in “—Tax Consequences of the Rescission Offer—The Notes”.

Shares of Common Stock

A U.S. Holder will recognize short-term capital gain or loss in an amount equal to the difference between the amount of cash received in respect of a share of Common Stock, other than any portion that constitutes interest, and the U.S. Holder’s adjusted tax basis in that share, unless the transaction is not treated, with respect to that U.S. Holder, as a redemption that is “not essentially equivalent to a dividend”, “substantially disproportionate” or a “complete termination” of the U.S. Holder’s interest in the Company, in each case within the meaning of section 302 of the Code. Each holder should consult its own tax adviser to determine whether any of the foregoing three tests under section 302 of the Code is satisfied. If none of those tests is satisfied, the tendering stockholder will be treated as having received a dividend includible in gross income in an amount equal to the lesser of the amount of cash received by the stockholder and the amount of our current and accumulated earnings and profits attributable to the distribution. Subject to certain exceptions for short-term and hedged positions, the portion of a distribution treated as a dividend that a noncorporate shareholder receives should be eligible for the 15% maximum tax rate for dividends. To the extent the distribution is not treated as a dividend, it will constitute a tax-free reduction in the U.S. Holder’s basis in the share of Common Stock that is redeemed, to the extent thereof, and thereafter will be treated as gain from the sale or exchange of that share. For other rules applicable to the tax treatment of a dividend, see “—Tax Consequences of the Exchange Offer — Tax Treatment of Common Stock Acquired on Conversion of a New Note or Exercise of a New Warrant”.

General

The portion of any payment a U.S. Holder receives in exchange for an Old Note, Old Warrant or share of Common Stock pursuant to the Rescission Offer that constitutes interest should be treated as ordinary income.

Notwithstanding the foregoing, the law applicable to the Rescission Offer is unclear, and we have not obtained, nor do we intend to obtain, a ruling from the IRS regarding the tax consequences of the Rescission Offer. Thus, the IRS is not precluded from successfully asserting a contrary position or otherwise recharacterizing the transaction in whole or in part. For example, the IRS could characterize the Rescission Offer as a nontaxable return of the original purchase price together with interest that would be taxable as ordinary income.

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Tax Consequences of the Exchange Offer

Exchange of an Old Note for a New Note

The exchange. The exchange of an Old Note pursuant to the Exchange Offer for either an A Note or a B Note will be a taxable transaction for U.S. federal income tax purposes. The amount of short-term capital gain or loss that a U.S. Holder recognizes on that exchange will be the difference between the stated principal amount of the New Note received and the U.S. Holder’s adjusted tax basis in the Old Note surrendered in the exchange. The U.S. Holder’s adjusted tax basis in the Old Note will be determined in the manner described above in “—Tax Consequences of the Rescission Offer—The Notes”.

Interest. A U.S. Holder must include interest on a New Note in gross income as it is received or accrues in accordance with the U.S. Holder’s regular method of accounting for U.S. federal income tax purposes.

Sale, exchange or retirement of New Notes. Upon a sale, exchange or retirement of a New Note, a U.S. Holder will recognize gain or loss equal to the difference between the sum of the cash and the fair market value of any property received for the New Note, other than with respect to accrued but unpaid interest, and the U.S. Holder’s adjusted tax basis in the New Note. To the extent the amount realized on disposition of a New Note is attributable to accrued but unpaid interest, it will be treated as ordinary income. A U.S. Holder’s tax basis in a New Note will be equal to its stated principal amount, and a U.S. Holder’s holding period for the New Note will begin on the day after the date of the exchange. Any gain or loss recognized by a U.S. Holder will be capital gain or loss and will be long-term capital gain or loss if the New Note has been held for more than one year on the date of the disposition.

Conversion of New Notes. Upon a conversion of a New Note into Common Stock, a U.S. Holder will not recognize gain or loss except to the extent cash is received in lieu of a fractional share. A U.S. Holder’s basis in the Common Stock will be equal to the holder’s basis in the New Note that was converted, reduced by any portion of the basis allocable to a fractional share, and the holder’s holding period for that Common Stock will include the holder’s holding period for that New Note.

Adjustment to conversion price. An adjustment to the conversion price of the New Notes, or the failure to make an adjustment, in certain circumstances may result in a constructive distribution to the holders of the New Notes that could be taxable as a dividend under section 305 of the Code. In that event, a holder’s tax basis in the New Note would increase by the amount of the dividend.

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Exchange of an Old Warrant for New Warrants

The exchange. Except as discussed below, a U.S. Holder should not recognize any gain or loss on an exchange of an Old Warrant for New Warrants. In that event, a U.S. Holder’s adjusted tax basis in the New Warrants should be equal to its basis in the Old Warrant exchanged therefor, and the U.S. Holder’s holding period for the New Warrants should include the period for which the Old Warrant was held. It is unclear whether a U.S. Holder’s adjusted tax basis in the New Warrants will be allocated between the A Warrant and the B Warrant or whether for this purpose an A Warrant and a B Warrant will be treated as one warrant. If they are treated as one warrant, the basis in an Old Warrant should carry over in its entirety first to the A Warrant and, if it is not exercised, then to the related B Warrant. A U.S. Holder’s tax basis in an Old Warrant will be determined in the manner set forth in “—Tax Consequences of the Rescission Offer—The Notes”.

The discussion in the preceding paragraph is based on the Company’s belief that no excess value is being provided to holders of the Old Warrants by reason of the Exchange Offer, that is the fair market value of an Old Warrant is substantially equal to the fair market value of the New Warrants that will be issued in exchange for the Old Warrant pursuant to the Exchange Offer. The Company has not obtained any valuation of the Old Warrants or the New Warrants, and no assurance can be given that the values of an Old Warrant and New Warrants are substantially equal. The IRS is not bound by the Company’s determination, and if the IRS were to successfully challenge the Company’s position, it is possible that a U.S. Holder would be subject to U.S. federal income tax in connection with the exchange of an Old Warrant for New Warrants pursuant to the Exchange Offer. The precise manner in which a U.S. Holder would be subject to tax is unclear. It is possible that the exchange would be partially or fully taxable.

If it is partially taxable, a U.S. Holder could recognize income to the extent of any excess of the value of the New Warrants over the value of the Old Warrant (the "Excess Value"). In that case, the U.S. Holder’s tax basis in the New Warrants could be a split tax basis in which a portion of the tax basis for the New Warrants is equal to the tax basis in the Old Warrant exchanged therefor and the remaining portion is equal to the Excess Value. The U.S. Holder’s holding period for the New Warrants could be a split holding period in which the holding period for a portion of each New Warrant includes the period for which the Old Warrant was held and the holding period for the remaining portion begins on the day after the date of the exchange. Alternatively, the receipt of Excess Value, if any, could be treated as a distribution of rights to acquire our Common Stock pursuant to section 305 of the Code, which, under certain circumstances, could be taxable. For example, if the receipt of any Excess Value is treated as an increase in the proportionate interest in the assets or earnings of the Company by U.S. Holders of Old Warrants who exchange their Old Warrants for New Warrants pursuant to the Exchange Offer, that increase could be treated as a distribution to those U.S. Holders if other holders of Old Notes, New Notes or Common Stock receive a distribution of property, which for this purpose could include interest paid on the Old Notes or the New Notes. In that case, the distribution would be taxable as a dividend to the U.S. Holders who exchange their Old Warrants for New Warrants pursuant to the Exchange Offer to the extent of our current and accumulated earnings and profits. Any Excess Value in excess of our current and accumulated earnings and profits would be treated as a nontaxable return of capital and would be applied against and reduce the U.S. Holder’s adjusted tax basis in his Old Warrants and thereafter would be treated as gain from the sale or exchange of the Old Warrants. If the receipt of Excess Value, if any, is treated as a taxable distribution, the tax basis and holding period consequences of the distribution will depend on the amount of the Excess Value, the amount of our current and accumulated earnings and profits in the year of the exchange, and the U.S. Holder’s tax basis in its Old Warrants, but generally may result in a split basis and split holding period for the New Warrants. Each U.S. Holder of Old Warrants who exchanges the Old Warrants for New Warrants pursuant to the Exchange Offer should consult its own tax adviser.

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If the exchange is fully taxable, a U.S. Holder’s tax basis in the New Warrants should be equal to their fair market value on the date of the exchange, and its holding period for the New Warrants should begin on the day after the date of the exchange.

Disposition of a New Warrant. Upon a sale, redemption, lapse or other taxable disposition of a New Warrant, a U.S. Holder will recognize gain or loss in an amount equal to the difference between the sum of the amount of cash and the fair market value of any property received for the New Warrant and the U.S. Holder’s tax basis in the New Warrant, except that, in the case of lapse, if an A Warrant and a B Warrant are treated as one warrant for U.S. federal income tax purposes, no loss would be recognized unless and until the B Warrant lapses. That gain or loss will be capital gain or loss if the Common Stock to which the New Warrant relates would be a capital asset in the hands of the U.S. Holder and will be long-term capital gain or loss if the holding period for the New Warrant exceeds one year on the date of the disposition.

Exercise of a New Warrant. The exercise of a New Warrant will not be a taxable event for the exercising U.S. Holder, except with respect to cash, if any, received in lieu of a fractional share. A U.S. Holder will have a tax basis in the shares of Common Stock received on exercise of a New Warrant equal to the sum of the U.S. Holder’s tax basis in the New Warrant surrendered, reduced by any portion of the basis allocable to a fractional share, plus the exercise price of the New Warrant. A U.S. Holder generally will have a holding period in shares of Common Stock acquired on exercise of a New Warrant that commences on the date of exercise of the New Warrant.

Adjustment to conversion price. An adjustment to the exercise price of the New Warrants, or the failure to make an adjustment, in certain circumstances may result in a constructive distribution to the holders of the New Warrants that could be taxable as a dividend under section 305 of the Code. In that event, a holder’s tax basis in the New Warrants would increase by the amount of the dividend.

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TaxTreatment of Common Stock Acquired on Conversion of a New Note or Exercise of a New Warrant.

Distributions. Cash distributed on Common Stock will be treated as a dividend to the extent of our current and accumulated earnings and profits attributable to the distribution as determined under U.S. federal income tax principles. Subject to certain exceptions for short-term and hedged positions, a dividend a noncorporate shareholder receives on a share of Common Stock before January 1, 2009 will be subject to a maximum tax rate of 15%. If the amount of a distribution exceeds our current and accumulated earnings and profits attributable to the distribution, the distribution next will be treated as a nontaxable return of capital and will be applied against and reduce the U.S. Holder’s adjusted tax basis in the Common Stock, but not below zero. If the distribution exceeds both our current and accumulated earnings and profits attributable to the distribution and the U.S. Holder’s adjusted tax basis in its Common Stock, the excess will be treated as capital gain and will be long-term capital gain if the Common Stock has been held for more than one year.

Corporate holders of Common Stock generally should be eligible for the 70% dividends-received deduction with respect to the portion of any distribution on the Common Stock taxable as a dividend. However, corporate investors should consider certain provisions that may limit the availability of a dividends-received deduction, including but not limited to the holding period rules of section 246(c) of the Code, the rules of section 246A that reduce the dividends-received deduction for dividends on certain debt-financed stock, and the rules in section 1059 of the Code that reduce the basis of stock, and may require recognition of taxable gain, in respect of certain extraordinary dividends. Corporate holders should also consider the effect of the dividends-received deduction on the determination of alternative minimum tax liability.

Disposition of Common Stock. If you sell or dispose of your Common Stock in a taxable transaction, you will recognize capital gain or loss equal to the difference between the sum of the cash and the fair market value of any property received and your tax basis in the Common Stock. A U.S. Holder’s tax basis in shares of Common Stock acquired on conversion of a New Note will be determined in the manner set forth in “—Tax Consequences of the Exchange Offer—Exchange of an Old Note for a New Note” above, and a U.S. Holder’s tax basis in shares of Common Stock acquired on exercise of a New Warrant will be determined in the manner set forth in “—Tax Consequences of the Exchange Offer—Exchange of an Old Warrant for New Warrants”. The gain or loss will be long-term capital gain or loss if your holding period for your Common Stock exceeds one year on the date of the disposition. For corporate taxpayers, long-term capital gains are taxed at the same rates as ordinary income. For noncorporate taxpayers, net capital gain—the excess of the taxpayer’s net long-term capital gains over short-term capital losses—is subject to a maximum tax rate of 15% through December 31, 2008, and thereafter the maximum tax rate is 20%. The deductibility of capital losses is limited.

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Change in exercise price. The increase in the exercise price of New Warrants, and the reduction in the number of Warrants, held by a U.S. Holder who holds New Warrants and allows the A Warrants to expire unexercised could give rise to a constructive distribution on the Common Stock pursuant to section 305 of the Code in connection with the expiration of the A Warrants in 2006. In that event, holders of Common Stock would be treated as realizing a taxable dividend to the extent of the lesser of their pro rata share of the fair market value of that constructive distribution and the amount of the Company’s current and accumulated earnings and profits allocable to their pro rata share of that distribution. In other circumstances, an adjustment to the conversion price of the New Notes or to the exercise price of the New Warrants, or the failure to make an adjustment, may result in a constructive distribution to the holders of Common Stock that could be taxable as a dividend under section 305 of the Code. In that event, a holder’s tax basis in the Common Stock would increase by the amount of the dividend.

Information Reporting; Backup Withholding.

We are required to furnish to record holders of the New Notes and record holders of Common Stock, other than corporations and other exempt holders, and to the IRS, information with respect to interest paid on the New Notes and dividends paid on the Common Stock.

Certain U.S. Holders may be subject to backup withholding at the rate of 28% with respect to interest paid on a New Note, with respect to dividends paid on Common Stock and with respect to proceeds received from a disposition of a New Note, a New Warrant or a share of Common Stock. Generally, backup withholding applies only if:

·   the payee fails to furnish a correct taxpayer identification number to the payer in the manner required or fails to demonstrate that it otherwise qualifies for an exemption;

·   the IRS notifies the payer that the taxpayer identification number furnished by the payee is incorrect;

·   the payee has failed to report properly the receipt of a “reportable payment” on one or more occasions, and the IRS has notified the payer that withholding is required; or

·   the payee fails, in certain circumstances, to provide a certified statement, signed under penalties of perjury, that the taxpayer identification number furnished is the correct number and that the holder is not subject to backup withholding.

Backup withholding is not an additional tax but, rather, is a method of tax collection. A U.S. Holder will he entitled to credit any amount withheld under the backup withholding rules against its actual tax liability, provided the required information is furnished to the IRS.

You should consult your own tax adviser with respect to the U.S. federal income tax consequences of the Rescission Offer and the Exchange Offer and the U.S. federal income tax consequences of the acquisition, ownership and disposition of a New Note, a New Warrant and a share of Common Stock as well as any tax considerations applicable under the laws of any foreign, state, local or other taxing jurisdiction.

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LEGAL PROCEEDINGS

In September 2004, an order requesting the U.S. Attorney for Eastern District of North Carolina to prosecute an alleged criminal contempt of court by us, that occurred in the case of Tweddle Litho Corp. vs. Gilbralter and Scientigo, Inc., or Tweddle Case, was entered by a judge in the U.S. District Court, Eastern District of North Carolina in the United States District Court for the Eastern District of North Carolina. The U.S. Attorney for the Eastern District of North Carolina issued a criminal information against us alleging contempt of court by virtue of our violation of a court order entered on May 13, 2004 in the Tweddle Case when we sold our wholly-owned subsidiary, Convergion, on June 2, 2004 in violation of the provisions of the order of May 13, 2004 enjoining us from transferring any of our assets out of the ordinary course of business. In October 2004, we and the U.S. Attorney entered into a written plea agreement whereby we agreed to pay $50,000 for the alleged criminal contempt of court. The matter was ruled on and accepted in U.S. District Court for the Eastern District of North Carolina during the three months ended May 31, 2005. We were also placed on probation for one year.

In April 2004, iGate, Inc. (“iGate”) filed a complaint against Gilbralter Publishing, Inc. (“Gilbralter”) and us in the U.S. District of the Eastern District of North Carolina, Southern Division, claiming that we were liable to iGate in the amount of approximately $725,000. iGate asserts that Gilbralter owed this sum to iGate and that a fraudulent conveyance occurred when Gilbralter forgave $5,000,000 in liabilities of a wholly-owned subsidiary of ours which were guaranteed by us in exchange for our issuing to Gilbralter shares of our Common Stock and warrants to purchase our Common Stock. In May 2004, a default judgment was entered against us. In November 2004, the court vacated the default judgment and granted us leave to answer the complaint. We filed our answer and asserted affirmative defenses alleging absolute defenses to the claims of iGate. We asserted that we had no liability to iGate and had meritorious defenses with respect to all liability asserted in the complaint.

Edward Arthur Bohn vs. Terrence Jude Leifheit; E-Commerce Support Center, Inc.; Gibralter Publishing, Inc; Global Demand Publishing, Inc.; Sky Investments of Jacksonville, Inc.; Jan Kaster and Market Central, Inc.

Edward Bohn filed a Complaint in June 2005 to initiate the above-captioned action, and obtained a Temporary Restraining Order on the same day. Subsequently, Edward Bohn modified the Temporary Restraining Order to limit its effort against the Company, to enjoin the Company from issuing its stock to Terrence Jude Leifheit. Subsequently, an Amended Complaint was filed by Edward Bohn to dismiss all counts against the Company and ecom., except for injunctive relief relating to the issuance of the Company’s stock. The Company has no liabilities asserted against either by Plaintiff or any of the Defendants. The Company believes it has meritorious defenses to the complaint and intends to vigorously defend itself against the claim.

In May 2005, the Company was notified by a software license monitoring group that it was not in compliance with certain computer software licensing agreements. The Company believes that it has meritorious defenses to the allegations and intends to vigorously defend itself against the claims.

In the ordinary course of business, we have become subject to additional litigation and claims on various matters. There exists the possibility that we will not prevail in all cases. However, based on anticipated adverse final determination of these litigations and claims, we do not believe that such litigation and claims would have a material adverse effect on our financial condition.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Executive Officers and Directors

As of September 30, 2005, our executive officers and directors were as follows:

Name	Age	Director Since	Position	Term Expires
Doyal G. Bryant	52	2004	Director, CEO	2007
Clifford A. Clark	53	2002	Director, CFO, Secretary	2005
Ronald L. Attkisson*	57	2004	Director	2007
Hoyt G. Lowder#	63	2004	Director	2007
Stuart J. Yarbrough*#	54	2005	Director, Chairman of the Board	2006
Paul Odom	56		Senior Vice President - Software Applications and Solutions
Cynthia S. White	58		Vice President and Chief Operations Officer

NOTE: The terms of the directors are divided into three separate three-year classes. Each director holds office until the year in which his term expires.

* member of Audit Committee

# member of Compensation Committee

Our Board of Directors has determined that Mr. Yarbrough qualifies as a financial expert as such term is defined by the SEC.

We do not have a nominating or corporate governance committee.

The business experience of each of the persons listed above during the past five years is as follows:

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DOYAL G. BRYANT has served as our President and Chief Executive Officer since April 2004, and as a Director since October 2004. Mr. Bryant has over 25 years experience in senior corporate management, product development, financing, operations and sales in all of Scientigo's combined product areas. He joined Scientigo when we entered into a letter of intent to acquire Convey Systems in which he was an owner and President and CEO. Prior to Convey, from 1991 to 2003 Mr. Bryant held senior management or ownership positions in companies that provided financial and technical due diligence services for major investment banking firms with transactions valued at over $300 million. He played an integral part in the growth and development of major telecommunication companies such as ZTEL, Premiere Technologies, CommSouth, Talk.Com, PrimeTec International, and ATMNet. His companies have developed international joint venture agreements and investment transactions for Voice, VoIP, and Internet related services in Canada, Mexico, Australia, Japan, Hong Kong, as well as several European and South American countries. Mr. Bryant holds a B.S. in business administration from Drury College in Missouri and has performed additional studies at Oxford University in England.

CLIFFORD A. CLARK has been our VP of Finance since February 2001 and a director since July 2002. Since October 2004, Mr. Clark has also served as Corporate Secretary for Scientigo. Mr. Clark also serves as V.P. of Finance for Insource Business Strategies, Inc., a payroll processing and PEO headquartered in Mooresville, NC. Mr. Clark has held this position since August 2004. Mr. Clark has continued to perform consulting and financial advisory services for a number of companies. From 1999 to 2002, Mr. Clark served as Vice President of Finance for Gilbralter and other entities comprising Gilbralter. Mr. Clark served as President of Kane Realty from 1994 through 2001 and was also President of Parallel Corporation from 1991 through June 2003. Mr. Clark’s experience includes more than 25 years in numerous financial and accounting roles, including 11 years with Price Waterhouse and 5 years in the venture capital arena. Mr. Clark has a bachelor’s degree in Business Administration from the University of North Carolina at Chapel Hill.

HOYT G. LOWDER is senior vice president of FMI, Inc., a leading consulting company to the construction and contracting industry. Mr. Lowder is managing director of FMI’s southern regional office in Tampa. In addition to directing the management consulting activities for contractor clients, he also maintains primary responsibility for major manufacturers and suppliers of construction materials and equipment in North America. His current focus is on building value for selected major national and international construction-industry firms. As a specialist in strategic planning and marketing implementation, Mr. Lowder has extensive experience with the work acquisition process, in ascertaining the motives of major buyer groups and developing marketing and technology plans to help his clients gain a competitive advantage. Mr. Lowder holds bachelor of science and master of science degrees from North Carolina State University.

RONALD L. ATTKISSON has served as Chairman, Chief Executive Officer and President of Jones, Byrd & Attkisson, Inc. since its organization in 2003. Previously, Mr. Attkisson provided investment banking services through Attkisson, Carter & Company, which he founded in 1988 as Attkisson & Associates. Attkisson & Associates grew to be one of the largest independent securities firms in Atlanta while providing investment brokerage, advisory and banking services to both individual and corporate clients in over 30 states. Mr. Attkisson sold most of his interest in the firm in January 2001, but retained an association with the firm until May 2003, when he resigned from the firm before starting Jones, Byrd & Attkisson, Inc. Prior to founding Attkisson & Associates, Mr. Attkisson was associated with Interstate Securities and Johnson, Lane, Space, Smith & Company, which were predecessor firms to Wachovia Securities. Prior to this, he was a vice president at The Robinson-Humphrey Company from 1978 to 1981. Mr. Attkisson graduated from the University of North Carolina at Chapel Hill in 1970. Mr. Attkisson is a director of Seawright Holdings, Inc., One Travel Holdings, Inc. and REIGNMAKER Communications, Inc.

STUART J. YARBROUGH is currently a principal in CrossHill Financial Group, a private equity funding, mezzanine financing and bridge financing company based in the Washington, D.C. area, which Mr. Yarbrough co-founded in 1994. His experience includes advising clients in the negotiation of mergers and acquisitions, including due diligence, loan restructuring and refinancing, capital raising options and strategies, and strategic planning. Prior to founding CrossHill, he served on the Board of Directors and as the Managing Partner of both the Washington, D.C. and Richmond offices of BDO Seidman, an international accounting and management consulting firm. Mr. Yarbrough serves as a board member of SBR, Inc. Mr. Yarbrough is a graduate of Duke University where he was named to the Atlantic Coast Conference Honor Roll for outstanding academic and athletic achievement. He is a member of the Economic Club of Washington and a member of Leadership Washington.

PAUL S. ODOM was formerly the Founder, President, and Chief Technology Officer of Pliant Technologies Inc. where he created a revolutionary information management technology. He joined Scientigo when the assets of Pliant were acquired by us in 2003. Before forming Pliant Technologies Inc. in 1995, he was Vice President of Magisys Inc. where he led the design and implementation of software applications for oil field operations. As Manager of Process Systems Software for M. W. Kellogg from 1988 to 1994, he had responsibility for the development of software to automate engineering design processes. In addition, Mr. Odom has more than 16 years of experience in leading edge software applications development in the Oil and Gas industry, working with Dixie Corporation, ARCO Chemical Company, and The Standard Oil Company of Ohio. Mr. Odom has a Bachelor's degree in Chemical Engineering from the University of Arizona and currently holds five (5) patents in the area of information management and engineering.

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CYNTHIA S. WHITE has served as our Chief Operations Officer since September 2005. During the last five years, Ms. White has been a consultant with Dover Holdings, LLC, Bisys and Strategic Foundations, LLC, most recently with Strategic Foundations, LLC. From August 2003 to the present, Ms. White has been the Financial and Operating Principal and CFO for Jones Byrd & Attkisson, Inc. Ms. White will end that consulting arrangement at such time that Jones Byrd & Attkisson transitions her position to her successor. Ms. White has over 25 years of experience in senior corporate management with emphasis on strategic planning, change management and systems/operations engineering. Focusing on the financial services industry including money center banks, investment banking firms, trading firms and brokerage companies she has developed and enhanced existing infrastructures to increase productivity while minimizing risk or regulatory exposure. Ms. White has provided corporate management services to such clients as Preferred Trade, FIMAT, Jones, Byrd & Attkisson, Inc., TradeStation, E-trade, ING, GE Capital, SunTrust, and Bank of America. At Bank of America in San Francisco, California, Ms. White was responsible for the processing of $60 billion in transactions per day as Director of Securities Operations. During her tenure at Bank of America, she designed, implemented and managed self-clearing securities operations, and developed international securities distribution channels for the Capital Markets Section 20 Broker/Dealer with a full range of products including equities, U.S. Treasury securities, corporate debt securities, municipal bonds, commercial paper and repurchase agreements. While at Bank of America, Ms. White refined a “production ready” process to be used for systems rollout that minimizes the risk of implementation. Ms. White holds a Bachelor of Science Degree in Applied Mathematics with a minor in Physics from North Carolina State University and holds the following securities licenses: a Series 7 - General Securities Registered Representative, a Series 24 - General Securities Principal, a Series 27 - Financial and Operations Principal, and a Series 53 - Municipal Securities Principal.

Section 16(a) of the Securities Exchange Act of 1934, as amended (the "Act"), requires our directors and executive officers, and persons who own more than 10% of our common stock, to file with the Securities and Exchange Commission certain reports of beneficial ownership of our common stock. We believe that such reports have been filed by our directors and executive officers, but with respect to all such directors and executive officers, not in a timely manner. We do not believe that certain 10% holders of our Common Stock have filed such reports.

We have adopted a code of ethics that applies to the senior financial officers which includes the CEO, COO, CFO and principle accounting officer.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth information, to the best of our knowledge, as of October 17, 2005, with respect to each person known by us to own beneficially more than 5% of the outstanding Common Stock, each director and all directors and executive officers as a group.

NAME AND ADDRESS OF BENEFICIAL OWNER	AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP (1)			PERCENT OF CLASS (2)
Doyal G. Bryant*		1,036,247 (3	)		6.9	%
Paul S. Odom*		275,308 (4	)		1.9	%
Clifford A. Clark*		178,949 (5	)		1.3	%
Cynthia S. White*		334,462 (6	)		2.4	%
Ronald L. Attkisson*		1,761,456 (7	)		11.3	%
Hoyt G. Lowder*		589,894 (8	)		4.1	%
Stuart J. Yarbrough*		317,529 (9	)		2.2	%
Glen H. Hammer		1,452,048 (10	)		10.3	%
William A. Goldstein		2,562,830 (11	)		17.7	%
All directors and executive officers as a group (7 persons in group)		4,493,844			25.0	%

Note: Unless otherwise noted, all persons address is 6701 Carmel Road, Suite 205 Charlotte, NC 27226

* Director and/or executive officer

Note: Unless otherwise indicated in the footnotes below, the Company has been advised that each person above has sole voting and investment power over the shares indicated above.(1)Share amounts include, where indicated, Common Stock issuable upon the exercise of certain stock options and stock warrants which are exercisable or convertible within sixty days from September 30, 2005. 

(2) Based upon 13,884,071 shares of Common Stock outstanding on October 17, 2005. Percentage ownership is calculated separately for each person on the basis of the actual number of outstanding shares as of October 17, 2005 and assumes the exercise of certain stock options and warrants held by such person (but not by anyone else) exercisable within sixty days.

(3) Includes 1,000,000 shares that may be acquired by Mr. Bryant pursuant to the exercise of stock purchase options exercisable within sixty days at exercise price of $1.60 and warrants issued for the purchase of 36,247 shares at prices ranging from $.90 to $1.60.

(4) Includes 36,749 shares owned by Mr. Odom and his spouse and 238,559 shares that may be acquired by Mr. Odom pursuant to the exercise of stock purchase options and warrants exercisable within sixty days at exercise prices of $1.60-$2.35.

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(5) Includes (i) 20,826 shares owned directly and (ii) 148,123 shares that may be acquired by Mr. Clark pursuant to the exercise of stock purchase options and warrants exercisable within sixty days at exercise prices from $.90 to $2.20 per share.

(6) Includes (i) 140,712 shares that may be obtained upon the conversion of the 6.4% Convertible Notes owned by Ms. White and her spouse, which are convertible within sixty days at a conversion price of $1.3325 per share based upon the principal balance, and (ii) 100,000 options and 93,750 warrants exercisable within sixty days at exercise price of $1.00-$1.35.

(7) Includes 10,000 shares owned directly by Mr. Attkisson or entities which he controls and 100,000 shares that may be acquired by Mr. Attkisson pursuant to the exercise of stock purchase options and 1,651,456 warrants exercisable within sixty days at exercise prices of $1.00 - $1.35.

(8) Includes (i) 249,947 shares owned directly and (ii) 100,000 shares that may be acquired by Mr. Lowder pursuant to the exercise of stock purchase options and 239,947 warrants exercisable within sixty days of October 17, 2005 at an exercise price of $.85 - $1.35.

(9) Includes (i) 59,964 shares of the Company’s common stock, (ii) warrants to purchase 96,589 shares of Company common stock within sixty days at an exercise price of $.85 - $1.00, (iii) 60,976 shares that may be obtained upon the conversion of the 6.4% Convertible Notes owned by Mr. Yarbrough, which are convertible within sixty days at a conversion price of $1.3325 per share based upon the undiscounted note balance and (iii) 100,000 shares that may be acquired by Mr. Yarbrough pursuant to the exercise of stock purchase options at $1.35. This does not include (i) 159,896 shares owned directly (ii) $750,000 principal amount of the Company’s 6.4% Senior Convertible Notes which are convertible within sixty days into 562,852 shares of the Company’s common stock, warrants to purchase 375,000 shares of Company common stock exercisable within sixty days at an exercise price of $1.00 per share and (iii) 159,896 warrants exercisable within sixty days at exercise price of $.85 per share, all of which are owned by an investment limited partnership of which Mr. Yarbrough is partial owner of the limited liability company which is the general partner of such investment partnership. Mr. Yarbrough disclaims any beneficial ownership of such shares and warrants.

(10) Includes 1,172,509 shares owned directly by Mr. Hammer and 279,539 shares that may be acquired by Mr. Hammer pursuant to the exercise of warrants exercisable within sixty days of October 17, 2005 at an exercise price of $.85.

(11) Includes 2,001,415 shares owned directly by Mr. Goldstein or entities he controls and 561,415 shares that may be acquired by Mr. Goldstein pursuant to the exercise of warrants exercisable within sixty days at an exercise price of $.85 per share.

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DESCRIPTION OF SECURITIES

The following description is a summary of our securities and contains the material terms of the Notes, Warrants and our Common Stock into which the Notes are convertible and the Warrants exercisable.

Our authorized capital stock presently consists of 75,000,000 shares of Common Stock, par value $.001 per share, and 10,000,000 shares of preferred stock, par value $.001 per share (“Preferred Stock”), of which 350,000 shares are designated Series B Convertible Preferred Stock (“Series B Preferred Stock”). As of October 17, 2005, 13,884,071 shares of our Common Stock were issued and outstanding and 350,000 shares of our Series B Preferred Stock were issued and outstanding.

Common Stock

Each holder of Common Stock is entitled to one vote for each share of Common Stock held on all matters submitted to the vote of stockholders. Cumulative voting for the election of directors is not provided for in our Certificate of Incorporation, which means that the holders of a majority of the shares voted can elect all of the directors then standing for election.

Subject to preferences that may apply to shares of Preferred Stock, including the Series B Preferred Stock, outstanding at the time, the holders of outstanding shares of Common Stock are entitled to receive dividends out of assets legally available at the times and in the amounts as our board of directors may from time to time determine. Currently, our board of directors does not intend to pay any dividends to holders of shares of Common Stock.

The holders of our Common Stock are not entitled to preemptive rights and our Common Stock is not subject to conversion or redemption.

Upon any liquidation, dissolution or winding-up, the assets legally available for distribution to our stockholders are distributable ratably among the holders of our Common Stock and any participating Preferred Stock outstanding at that time after payment of liquidation preferences, if any, on any outstanding Preferred Stock and payment of other claims of creditors. Our Series B Preferred Stock has liquidation preferences that are senior to the liquidation preference of the Common Stock.

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Preferred Stock

Our board of directors has the authority, subject to limits imposed by Delaware General Corporation Law, to issue up to 10,000,000 shares of Preferred Stock in one or more series, to establish from time to time the number of shares to be included in each series, to fix the rights, preferences and privileges of the shares of each wholly unissued series and any of its qualifications, limitations and restrictions. Our board of directors can also increase or decrease the number of shares of any series, but not below the number of shares of that series then outstanding, without any further vote or action by our stockholders.

Our board of directors may authorize the issuance of preferred stock with voting or conversion rights that adversely affect the voting power or other rights of our Common Stockholders. The issuance of additional Preferred Stock, while providing flexibility in connection with possible acquisitions, financings and other corporate purposes, could have the effect of delaying, deferring or preventing a change in control and may cause the market price of the Common Stock to decline or impair the voting and other rights of the holders of the Common Stock.

Series B Preferred Stock

On March 25, 2004, Scientigo entered into an agreement to issue to an investment group 350,000 shares of its newly designated Series B Preferred Stock with a stated value of $10.00 per share and an aggregate stated value of $3.5 million.

Except for limited class voting rights required by Delaware law, the holders of Series B Preferred Stock have no voting rights. The Series B Preferred Stock does not accrue dividends and has a liquidation value of $10.00 per share as adjusted for certain reorganizations and reclassifications.

At any time, the holder of the Series B Preferred Stock may elect to convert its shares of Series B Preferred Stock into shares of Common Stock at a conversion price, as applied against the stated value of the Series B Preferred Stock, that is the lesser of (1) $1.75, or (2) 80% of the lowest closing bid price of our Common Stock during the ten (10) days prior to the conversion notice. Such per share conversion price has a floor of $.875 and a ceiling of $1.75. Such conversion price is adjusted for certain reorganizations and reclassifications.

The holder of the Series B Preferred Stock received an option to acquire additional shares of our Common Stock to the extent that the full exercise of its conversion rights described above results in the receipt of less than 4,000,000 shares of Common Stock. Such option will have an exercise price of $1.92, $.10 above the closing bid price on the effective date of the agreement between the parties, and will be exercisable for a 30-day period following the completion of the conversion of all shares of Series B Preferred Stock. The option is exercisable only upon the payment of the cash exercise price.

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The holder of the Series B Preferred Stock has the right to request the registration of the Common Stock issued to it upon conversion of its shares of Series B Preferred Stock. Such rights are subject to restrictions based on market conditions, the size of the public offering and the type of offering.

At any time prior to the conversion of all shares of Series B Preferred Stock by the holder, in the event of certain defined transactions which constitute a change of control of Scientigo, we have the right to require the conversion of all remaining outstanding shares of Series B Preferred Stock into shares of Common Stock.

Upon our liquidation or dissolution the holder of the Series B Preferred Stock will be entitled to a liquidation preference in the amount of $10.00 per share of Series B Preferred Stock.

Scientigo 2005 6.4% Senior Convertible Notes

Principal, Maturity and Interest

The Principal Amount and all accrued but unpaid interest of the Notes is due on May 31, 2007.

Interest on the Principal Amount of the Notes accrues at a rate of 6.4% per annum and is payable quarterly in arrears on May 31, August 31, November 30, and February 28 of each year commencing upon issuance. Interest is paid to those persons who were holders of record of the Notes on May 15, August 15, November 15 and February 15 immediately preceding each interest payment date.

The Notes may be prepaid at any time by us without penalty or premium.

Conversion of Notes

From the date of issuance until May 31, 2007, the Notes are convertible in whole or in part into shares of our Common Stock at a conversion rate of one share per $1.3325 of Principal Amount of the Notes. Prior to a payment of any Principal Amount of the Notes by us, holders must be provided with thirty (30) days written notice in the event that they wish to convert their Notes into shares of Common Stock prior to such payment.

The conversion of each $1.00 of Principal Amount of the Notes into shares of our Common Stock decreases the Principal Amount of the Notes by $1.00 as of the date of conversion.

Security for Repayment of the Notes

The repayment of the principal and any accrued but unpaid interest pursuant to the Notes is secured by a first priority security interest in Scientigo’s intellectual property granted pursuant to a security agreement entered into by us and CrossHill Georgetown Capital, LP, the designated agent of the holders of Notes and the holder of $750,000 Principal Amount of the Notes (the “Note Agent”). Upon the payment or conversion of $5,000,000 of the total principal amount and of the Notes, or upon the substitution of $5,000,000 in cash collateral by us for the benefit of the note holders, our XML patents will be released from such security interest. If after substitution of such cash collateral for the XML Patents, we notify the Note Agent in writing of the conversion into shares of our Common Stock and/or repayment of any or all of the principal amount of the Notes, the Note Agent will, after review of the evidence of such conversion and/or repayment, release a pro rata portion of such cash collateral being held to us based upon the portion of the principal amount of such Notes so converted and/or repaid. This procedure may not occur more often than once every 30 day period.

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As of September 30, 2005, $6,383,950 Principal Amount of Notes are outstanding. Payments of interest under such Notes have been paid through August 31, 2005.

Warrants

In connection with the issuance of the Notes, we issued warrants to purchase shares of our Common Stock.

Exercise Price. The Warrants are exercisable in whole or in part at $1.00 cash per share of our Common Stock.

Term. The Warrants are exercisable until June 30, 2010.

As of September 30, 2005, Warrants to purchase 3,164,788 shares of our Common Stock are outstanding.

Preferred Stock Warrants

The Preferred Stock Warrants issued in connection with our previous exchange offer to all former holders of our previously outstanding Series A Convertible Preferred Stock provide the holder with the right to purchase one (1) share of our Common Stock at $.85 cash per share. The Preferred Stock Warrants are exercisable through June 30, 2007.

As of September 30, 2005, Preferred Stock Warrants to purchase 5,051,143 shares of Common Stock are outstanding.

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INTERESTS OF NAMED EXPERTS AND COUNSEL

Our financial statements included in this prospectus have been audited by Russell Bedford Stefanou Mirchandani LLP, independent registered public accounting firm, as indicated in their report (included herein). These financial statements have been included in this prospectus and in the registration statement of which this prospectus is a part in reliance upon the authority of the accounting firm as experts in accounting and auditing. No expert or counsel within the meaning of those terms under Item 509 of Regulation S-B will receive a direct or indirect interest in us or was a promoter, underwriter, voting trustee, director, officer, or employee of us. Nor was any such expert hired on a contingent basis or will receive a direct or indirect interest in us.

DISCLOSURE OF COMMISSION POSITION OF

INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Our Certificate of Incorporation, as well as our By-Laws provide for the indemnification of our directors, officers, employees and agents to the fullest extent provided by the corporate laws of the State of Delaware, as well as is described in our Certificate of Incorporation and our By-Laws. These sections generally provide that our directors will not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to us or our stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under the Delaware General Corporation Law, or (iv) for any transaction from which the director derived any improper personal benefit. In addition, we may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or complete action, suit or proceeding whether civil, criminal, administrative or investigative, or by or in our right to procure judgment in our favor, by reason of the fact that he is or was a director, officer, employee or agent of Scientigo, or is or was serving at our request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to our best interest, in accordance with, and to the full extent permitted by statute.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or controlling persons, pursuant to the foregoing provisions, or otherwise, we have been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable.

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DESCRIPTION OF BUSINESS

We are a knowledge management company specializing in solutions that are designed to enable businesses to efficiently store, categorize and retrieve information with state of the art speed and precision. We believe our products are advanced in the market in the areas of information capture, storage and retrieval. We have numerous elemental patents issued and pending in the field of Enterprise Content Management with a revolutionary artificial intelligence we call Business Process Automation.

In addition to these elemental patents, we own patents and patent-pending technologies that together comprise a suite of solutions that include software for next-generation search, intelligent document recognition, data capture, cleansing, mining, and integration. We have two subsidiaries, Convey Systems International, Inc. and Tigo Search, Inc. Each of these subsidiaries is effectively inactive.

HISTORY

Market Central, Inc. (f/k/a Paladyne Corp) is the surviving company from a March 1999 merger with Synaptx Worldwide, Inc., a Utah corporation.

In February 2001, through a wholly-owned subsidiary, we merged (the “Merger”) with E-Commerce Support Centers, Inc., ("E-Commerce"), pursuant to an Agreement and Plan of Merger, dated as of December 21, 2000, as amended (collectively, the “Merger Agreement”). Upon the Merger, E-Commerce became our wholly-owned subsidiary.

In February 2003, at a special meeting of the stockholders, our stockholders approved the following items: 1) a change in the name of the Company from Paladyne Corp. to Market Central, Inc., 2) a one-for-ten reverse split of the Company’s common stock and 3) the sale of an aggregate of 8,880,740 post-split shares of common stock to three buyers. This resulted in a change in control of the Company to these three buyers. In connection with this transaction, we converted all classes of our Preferred Stock to our Common Stock.

In April 2003, we consummated the acquisition of U.S. Convergion, Inc. (“Convergion”) pursuant to a Stock Purchase Agreement dated April 3, 2003 entered into by and among us and each of the six shareholders of Convergion. We acquired all of the outstanding capital stock of Convergion in exchange for the issuance of 374,630 restricted shares of our Common Stock and assumption of certain liabilities. We also acquired effective July 31, 2003, substantially all the assets of Pliant Technologies, Inc. in exchange for the issuance of 228,351 restricted shares of our Common Stock and a warrant to purchase an additional 182,681 shares of our Common Stock and assumption of certain liabilities.

In May 2004, we disposed of the U.S. Convergion, Inc. subsidiary by selling the capital stock of Convergion that had been acquired in April 2003. This sale, to Sylvia Holdings, Inc., a New York based corporation, included costs associated with the sale that exceeded any proceeds from the sale. We wrote off approximately $4 million in goodwill, related to the Convergion acquisition, in the second quarter of fiscal 2004 which coincided our decision to divest ourselves of Convergion; during the third quarter of fiscal 2003 the sale to Sylvia Holdings, Inc. was recorded which resulted in a gain of approximately $2.7 million. If the goodwill write off and sale had occurred in the same quarter our financial statements would have reflected a $1.3 million loss on the sale of U.S. Convergion, Inc.

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In April 2004, we signed a letter of intent to acquire the assets of Convey Systems, Inc. a wholly owned subsidiary of The TAG Group, Inc. Our CEO is a shareholder of the The Tag Group, Inc.; he has agreed to forfeit the shares entitled him to pursuant to the acquisition that represent his ownership interest in The TAG Group, Inc. The letter of intent provides for us to issue approximately 1,180,488 shares of our Common Stock to The TAG Group, Inc. and/or its creditors for the assets which include cash, accounts receivable and certain proprietary products in the areas of web conferencing and collaboration and web-based PC support tools. The TAG Group, Inc., Convey Systems, Inc. and we have executed an agreement whereby we are providing day-to-day management and working capital for Convey Systems, Inc. We will receive the net proceeds from sales of Convey products from April 15, 2004 through closing. All net working capital advances made by us will reduce the shares issued in the final purchase transaction. This transaction is now expected to be completed in late 2005. Audit issues and stockholder notification requirements at The TAG Group, Inc. resulted in the delays.

In November 2004, we were notified by our two primary shareholders that they were returning, to our treasury, approximately 5,800,000 shares of our Common Stock, which was approximately 45% of the total common shares outstanding at that time. The notification also provided that they, Glen Hammer and Will Goldstein, were resigning from our Board of Directors and would return to us, for cancellation, a warrant to purchase approximately 2,333,000 shares of our common stock. In addition, these shareholders were converting a net of approximately $1,050,000 in current debt owed them by us into our Series A Preferred Stock. This amount was net of approximately $428,000 of amounts owed to us by companies controlled by one of these shareholders.

In May 2005, E-Commerce Support Centers, Inc., ("E-Commerce") our wholly-owned subsidiary, entered into an Asset Purchase Agreement (the "Asset Purchase Agreement") with Customerlinx of North Carolina, Inc., ("Customerlinx NC"), a wholly-owned subsidiary of Customerlinx Corp. ("Customerlinx"), pursuant to which Customerlinx NC agreed to purchase substantially all of the assets of E-Commerce. The purchase price for the assets was the sum of $1,100,000, and the assumption of $85,234 of net liabilities of E-Commerce (the "Liabilities"). E-Commerce owed Customerlinx the sum of $129,000 in management fees pursuant to a management agreement which was paid with a reduction in the selling price and related promissory note (the "Note") to E-Commerce to $971,000, The Note has a maturity date of 39 months, pays simple interest at five percent (5%), and is secured by certain assets of Customerlinx NC. In the event that Customerlinx NC has not pre-paid the Note in full by May 31, 2006, then Customerlinx NC shall also pay to E-Commerce on or before July 31, 2006 an amount equal to (I) 0.75 multiplied by (II) the amount by which (A) the net income (which calculation shall only include expenses directly attributable to Customerlinx NC's operation of the business in North Carolina and allocable corporate expenses) that Customerlinx NC generates from its operation of the business in North Carolina during the 12 months ending May 31, 2006 (i.e., the period commencing June 1, 2005 and ending May 31, 2006) exceeds (B) the greater of (i) zero or (ii) the net income or loss generated from the operation of the business in North Carolina by E-Commerce and Customerlinx NC in the calendar year ending December 31, 2005. On August 31, 2005, we entered into an agreement to sell all of the outstanding capital stock of E-Commerce to Lion Development Group II, Inc. (the "Agreement"). The transaction was closed on August 31, 2005. The purchase price for the assets was the sum of $1,000, and the assumption of all liabilities of E-Commerce. Additionally, we and the purchaser agreed that on or before one year from the date of the closing, we would in good faith complete a reconciliation of claims against E-Commerce and the payment of such claims in order to compute the deferred portion of the purchase price. Such deferred purchase amount is 70% of the amount by which the cash received from a note owned by E-Commerce and the remaining balance of such note exceeds liabilities paid or agreed to be paid from the proceeds of the note. Such amount is due to us either in the form of cash or assignment of a portion of such note. At closing, the note had a principal balance of $929,004 and is payable over a remaining term of 40 months together with simple interest at an annual rate of five percent (5%), and is secured by certain assets of the obligor.

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PRODUCTS AND SERVICES

Our current products and services originate from the acquisition of the assets of Pliant Technologies in July 2003. Pliant’s patents and related intellectual property, which we acquired, provided us with a platform to build what we believe is a very powerful suite of software for certain significant market opportunities, generally considered the Enterprise Content Management (ECM) markets by current definitions. We hold multiple patents and patent-pending technologies used to develop a suite of products that we believe provide solutions to the chaos created by the enormous quantities of information available electronically today. Our software includes next generation ECM capabilities. ECM includes intelligent search for the Web and the Enterprise, document classification, and intelligent document recognition. We believe our suite of products offers solutions and products for both Enterprise and Web Search, including the process of identifying and enabling specific content across the web or enterprise to be indexed, searched, and displayed to users. Document classification allows us to search documents for specific content which is we feel particularly useful in the litigation and compliance space. Intelligent document recognition (“IDR”) allows us to determine document type, extract data from documents, validate that data against other sets of data, or classify certain data contained in the document.

Our intellectual property currently includes five patents representing revenue opportunity via product and OEM licensing. To the extent that others are violating any protected rights under these patents, we intend to vigorously pursue our rights. The company has invested significant capital in the continued development of the Intellectual Property portfolio and has retained top specialists to leverage the company’s IP asset in sale or licensing opportunities.

Summary data on the four patents is as follows:

Patent No. Docket No	Issue Date	Expiration Date	Title/Abstract
5,842,213 002-US-002	11/24/1998	11/23/2015	Method for Modeling, Storing, and Transferring Data in Neutral Form/ The present invention simplifies the data modeling process and enables its full dynamic versioning by employing a non-hierarchical, non-integrated structure to the organization of information. This is achieved by expressing data modeling, storage and transfer in a particular non-hierarchical, non-integrated neutral form. The neutral form of the present invention enables complete parallel processing of both data storage and data transfer operations. It also enables the direct integration of separate but related data models and their data without remodeling or reloading. Finally, the present invention enables direct transfer of neutral form information in a manner that includes all of the properties required to independently understand and interpret each transferred data value.
6,393,426 002-US-003	5/21/2002	11/23/2015	Method for Modeling, Storing, and Transferring Data in Neutral Form/Continuation In Part (CIP) of above

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6,516,320 002-US-004	2/4/2003	2/3/2020	Tiered Hashing for Data Access/ A memory for access by a program being executed by a programmable control device includes a data access structure stored in the memory, the data access structure including a first and a second index structure (each having a plurality of entries) together forming a tiered index. At least one entry in the first structure indicates an entry in the second structure. The number of entries in the second structure being dynamically changeable. A method for building a tiered index structure includes building a first- level index structure having a predetermined number of entries, building a second-level index structure having a dynamic number of entries, and establishing a link between an entry in the first-level index structure and an entry in the second-level index structure.
6,370,534 002-US-005	4/9/2002	4/8/2019	Blocking Techniques for Data Storage/ Methods to store a first data structure having zero or more fixed-length data items and a reference to a second data structure are described. The second data structure having a variable-length data item (indicated by the reference) may also be stored in the memory. In addition, methods to validate and repair a pointer element having a file identification portion and a file offset portion are described. The methods include determining if the file identification portion indicates an allocated file and indicating an invalid pointer condition if the file identification portion indicates an unallocated file, else determining if the file offset portion indicates an allocated block in the allocated file, and indicating an invalid pointer condition if the file offset portion indicates an unallocated block. The described methods may be stored in any media that is readable and executable by a programmable control device.

We have also continued the marketing of the Convey products that are part of the acquisition that we expect to be completed in late 2005.

Our ECM solutions include a suite of software products and services designed to solve some of the most common and costly problems organizations face today. Our products are marketed under the Scientigo™ and Tigo™ names, which are trademark protected by the Company. These solutions include products for:

•Intelligent Document Recognition for paper-to-digital conversion and information extraction (IDR)

•Intelligent Classification and Search for enterprise and web content management

Each of these solutions utilizes artificial intelligence derived from elements of our patented technology platform and consequently we believe has significant advantages over solutions that do not have the benefit of these patents. The highlights of our product offerings include:

ARTIFICIAL INTELLIGENCE HIGHLIGHTS

•Neutral Form: Artificial Intelligence translator converts to a universal format

•Zero Latency Index: Single index for all forms of structured and unstructured data that grows automatically and incrementally, never requiring reorganization

•Minimal Hardware Demands: Storage, retrieval, and processing algorithms that do not depend on structural optimization for performance

•Petabyte Scalability:Continuous incremental pooling at enterprise scale

•Peer-to-peer networking capable.

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DATA MANAGEMENT

• The patented Scientigo™ storage schema contains all the organizational power of a database, but without the limitations imposed by database structure. The storage schema is non-hierarchical and the data elements are stored as meta tags allowing greater storage flexibility and zero latency.

Our patented artificial intelligence infrastructure operates continuously and incrementally to update and to process disparate structured and unstructured information “as-is”.

• Wehave two patents that address XML (Extensible Machine Language). These are U.S. Patent No. 5,842,213, entitled Method for Modeling, Storing and Transferring Data in Neutral Form, issued on Nov. 24, 1998 (“the ‘213 Patent”) and U.S. Patent No. 6,393,426, also entitled Method for Modeling, Storing and Transferring Data in Neutral Form, issued May 21, 2002 (“the ’426 Patent”).

Tigo™ Intelligent Document Recognition (IDR) Solution

Our unique, multi-patented Intelligent Document Recognition (IDR) software product is part of our suite of Enterprise Content Management solutions. We provide users with the ability to process structured, semi-structured, and unstructured forms and perform data extraction to a 90% plus level of automation with a single-pass, all at accuracy levels on the order of double-key entry manual processes. Tigo™ IDR solution, along with our shared-savings pricing model, produces significant savings for our clients with minimal risk. Tigo™ IDR:

•Replaces slow, labor intensive document processing with high-speed automation of extraction and validation

•Artificial intelligence identifies form type and reads labels and content as a human would

•Artificial intelligence learns correct document interpretation by observing operator corrections

•Retrieve archived images based on all content within the image using intent-based search

•Rapid and inexpensive installation of the software

•Quick and efficient new form set-up with little or no programming

•>99.99% Accuracy on validated entries

Tigo™ Intelligent Search Solution

We offer a multi-patented Intelligent Search product as part of the suite of Enterprise Content Management solutions. With Scientigo™, users can perform a single, intelligent search on all their structured or unstructured data information regardless of location and type, including documents, databases, and applications such as email, or even scanned paper documents.

Scientigo’s™ innovative solution quickly returns results with a number of sophisticated characteristics such as:

•Sophisticated Relevancy Ranking w/ Personalization

•Intent-Based and Context-Sensitive Search

•Appropriate Topics Automatically Generated with Interactive Drill Down

•Automated Classification

•Page Granularity

•Learning System, So User Preferences Improve Relevancy with Each Use

•Simple to implement and maintain, yet scalable enough to support unlimited users and volumes of content on inexpensive hardware

•Automated, Customizable Definition Sets Supported at the Engine Level

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•Natural Language Processing

•Artificial Intelligence differentiates our search capabilities versus other search engines

The foundation of our Tigo™ Search is a patented artificial intelligence infrastructure that operates continuously and incrementally to update and to process various structured and unstructured information “as is” from disparate sources throughout the enterprise. Raw content is first converted into neutral form data. Artificial intelligence processes are then performed in real time to index, categorize, and integrate this neutral form data on the basis of the context-sensitive semantic interpretation rather than literal forms of the content.

We currently manage the operations of Convey Systems, Inc. and are receiving the net proceeds from sales of its products. The purchase of Convey is expected to be completed in November 2005. The Convey products include Snap Conferencing, a collaborative an inexpensive, simple-to-use, on-line web conferencing, and Tech Umbrella, a remote technical support software product for desktop computers that enables technicians to support remote desktop computers 7 days a week, 24 hours a day.

This technology offers dynamic and interactive products and services that allow organizations to provide virtual sales presentations, remote desktop support, distance-learning sessions, spontaneous web conferences, and live customer service and desktop support over the Internet. The Convey technology will also be integrated with our suite of products to further complete Market Central’s Enterprise Content Management suite of software products. Convey's proprietary technology provides e-commerce product support and customer service using a live, video-based portal that supports real-time interactions, and the ability to collaborate upon demand, the product includes  text chat, digital photo, encrypted VOIP, Data, full-motion two way video and voice share, URL sharing features, as well as full collaboration and application-sharing capabilities. The Convey solutions are described below:

• Snap - Snap Conferencing is designed to be used in a corporate environment as a quick, easy, and inexpensive conferencing solution for multi-user video, voice, and application sharing. We believe Snap has the most advanced application sharing capabilities on the market with the easiest user interface.

• Tech Umbrella, a part of the Convey product line is designed to provide a Web-based package that encompasses leading edge technology for streamlining PC support and repair services. Tech Umbrella is offered to the IT marketplace, software and hardware developers, providers, integrators and supporters, as a comprehensive suite of online tools. Using Tech Umbrella, the IT technician should be able to efficiently and easily diagnose and repair technical problems on remote terminals without the difficulty of licensing, installing, and pre-configuring a third-party software application. Tech Umbrella is working with corporate affiliate companies and franchisors to penetrate the IT marketplace from the top down. This should enable a quicker presence in the marketplace, as entire groups become armed with Tech Umbrella's product packages. The Company has identified over 100,000 independent affiliates and an additional 3,000 IT franchises.

BUSINESS DEVELOPMENT AND STRATEGY

We have continued to pursue a strategy to divest ourselves of unprofitable and non-core operations that began in the fourth quarter of fiscal 2004. Our Enterprise Content Management (ECM)solutions and related products are being marketed through a series of partnerships with content management OEM’s and integrators. We believe that the OEM’s and integrators in the ECM space provide us with existing relationships and a sales and marketing presence that would take us years to develop. Marketing in this fashion (at the wholesale level), allows us to limit the size of our sales and marketing staff and still achieve economies of scale in the market place. Growth will occur as customer wholesalers increase their sales of our products and as we add new wholesale OEM’s and integrators. We are constantly looking for additional acquisitions and strategic partnerships to increase sales and market share. We believe our patented technologies and corresponding products provide unique, efficient solutions to numerous significant market niches. Configuring our ECM technologies together will enable us to produce turn-key industry solutions.

The above are our stated future goals. However, there can be no assurance that we will ever achieve our expressed goals.

POTENTIAL NEW ACQUISITIONS AND PRODUCT LINES

We intend to investigate, should opportunities arise, strategic acquisitions or mergers that fit our long-term objectives as financing and business conditions warrant, although there can be no assurance that we will be able to finalize any future acquisitions. Although we occasionally explore additional acquisition and merger opportunities, there can be no assurances that financing for any future acquisitions will be available on terms acceptable to us or at all, or that any future acquisitions or mergers will be consummated.

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SALES AND MARKETING

We market and sell our products and services through our employees and through the cooperative efforts of our business partners. We employ an integrated marketing effort designed to establish market presence and generate potential clients. Lead generation and branding efforts are the responsibility of our Marketing Department. Sales Department personnel engage prospects and develop new business from existing clients. Both marketing and sales manage business partner relationships.

COMPETITION

The industries to which we currently offer and intend to offer our products and services are highly competitive and characterized by rapidly changing technologies, evolving industry standards, frequent new product introductions, and rapid changes in customer requirements. We are of the opinion that there are no significant competitors for our integrated software platform; however, competitors exist for the various component “modules” within the platform.

We compete primarily with products offered by ABBYY, Datacap, OCE, SWT, ReadSoft and AnyDoc for Intelligent Document Recognition and Google, Yahoo, MicroSoft, Autonomy, Convera, FAST Search and Transfer and Verity for Intelligent Search. Some of our existing competitors, as well as a number of potential new competitors, have larger technical staffs, more established and larger sales and marketing organizations and greater financial resources than us. There can be no assurance that we will continue to compete successfully with our existing competitors or will be able to compete successfully with new competitors. In addition, there can be no assurance that competitors will not develop products that are superior to our products or achieve greater market acceptance. Competitive pressures in the form of aggressive price competition could also have a material adverse effect on our business, operating results and financial condition. Our future success will depend significantly upon our ability to increase our share of our target markets, to maintain and increase our renewal revenues from existing customers and to sell additional products, product enhancements, maintenance and support agreements and training services to existing customers and new customers. There can be no assurance that we will continue to compete favorably or that competition will not have a material adverse effect on our business, operating results or financial condition.

EMPLOYEES

As of September 30, 2005, we employed 21 individuals, consisting of 4 executives and 17 professionals, sales representatives, and office staff. We believe that our relationships with our employees are satisfactory.

BUSINESS SEGMENTS

We currently operate in one business segment which is the knowledge management segment.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

General

We are a provider of proprietary, patented software for data capture, cleansing, mining, integration, search, and intelligent document recognition.

Critical Accounting Policies

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and judgments that affect our reported assets, liabilities, revenues, and expenses, and the disclosure of contingent assets and liabilities. We base our estimates and judgments on historical experience and on various other assumptions we believe to be reasonable under the circumstances. Future events, however, may differ markedly from our current expectations and assumptions. While there are a number of significant accounting policies affecting our consolidated financial statements; we believe the following critical accounting policies involve the most complex, difficult and subjective estimates and judgments:

· revenue recognition

· allowance for doubtful accounts

· business combinations

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· goodwill and intangible asset impairment

· legal contingencies

· income taxes

· stock-based compensation.

Revenue Recognition

In accordance with generally accepted accounting principles (“GAAP”) in the United States, revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed, and collectibility of the resulting receivable is reasonably assured. Noted below are brief descriptions of the product or service revenues that the Company recognizes in the financial statements contained herein.

We recognize revenues from contracts in which the Company provides only consulting services as the services are performed. The contractual terms of the agreements dictate the recognition of revenue by the Company. Payments received in advance are deferred until the service is provided.

We recognize revenues from equipment and implementation contracts on the percentage-of-completion method, measured by the percentage of cost incurred to date to the estimated total cost for each contract. This method is used because management considers total job cost to be the best available measure of progress on these contracts.

Contract costs include all direct equipment, material, and labor costs and those indirect costs related to contract performance, such as indirect labor. Selling, general and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in contract performance, contract conditions, and estimated profitability that may result in revisions to costs and income are recognized in the period in which the revisions are determined.

Amounts collected prior to satisfying the above revenue recognition criteria are included in deferred revenue and advance payments in the accompanying consolidated balance sheets.

Allowance for doubtful accounts

We maintain an allowance for doubtful accounts to reduce amounts to their estimated realizable value. A considerable amount of judgment is required when we assess the realization of accounts receivables, including assessing the probability of collection and the current credit-worthiness of each customer. If the financial condition of our customers were to deteriorate, resulting in an impairment of their ability to make payments, an additional provision for doubtful accounts could be required. We initially record a provision for doubtful accounts based on our historical experience, and then adjust this provision at the end of each reporting period based on a detailed assessment of our accounts receivable and allowance for doubtful accounts. In estimating the provision for doubtful accounts, we consider: (i) the aging of the accounts receivable; (ii) trends within and ratios involving the age of the accounts receivable; (iii) the customer mix in each of the aging categories and the nature of the receivable; (iv) our historical provision for doubtful accounts; (v) the credit worthiness of the customer; and (vi) the economic conditions of the customer’s industry as well as general economic conditions, among other factors.

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Business combinations

The Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards ("SFAS") No. 141, Business Combinations, which established accounting and reporting standards for business combinations and requires that all business combinations be accounted for by the purchase method. Under the purchase method of accounting, the cost, including transaction costs, is allocated to the underlying net assets, based on their respective estimated fair values. The excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill.

The judgments made in determining the estimated fair values and expected useful lives assigned to each class of assets and liabilities acquired can significantly impact net income. For example, different classes of assets will have useful lives that differ. Consequently, to the extent a longer-lived asset is ascribed greater value under the purchase method than a shorter-lived asset, there may be less amortization recorded in a given period.

Determining the fair value of certain assets and liabilities acquired is subjective in nature and often involves the use of significant estimates and assumptions. We use a one-year period following the consummation of acquisitions to finalize estimates of the fair values of assets and liabilities acquired. Two areas, in particular, that require significant judgment are estimating the fair values and related useful lives of identifiable intangible assets. While there are a number of different methods used in estimating the value of acquired intangibles, there are two approaches primarily used: the discounted cash flow and market comparison approaches. Some of the more significant estimates and assumptions inherent in the two approaches include: projected future cash flows (including timing); discount rate reflecting the risk inherent in the future cash flows; perpetual growth rate; determination of appropriate market comparables; and the determination of whether a premium or a discount should be applied to comparables. Most of the foregoing assumptions are made based on available historical information.

Goodwill and intangible asset impairment

We adopted Statement of Financial Accounting Standards No. 142-Goodwill and Other Intangible Assets (SFAS 142) on April 1, 2001. Under SFAS 142, goodwill and other intangible assets with indefinite useful lives are no longer amortized, but are tested for impairment on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the asset below its carrying value amount. Events or circumstances which could trigger an impairment review include a significant adverse change in the business climate, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant changes in the manner of our use of the acquired assets or the strategy for our overall business, or significant negative industry or economic trends.

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Our principal consideration in determining impairment includes the strategic benefit to the Company of the particular assets as measured by undiscounted current and future operating income of the specified group of assets and expected undiscounted cash flows. Should impairment be identified, a loss would be reported to the extent that the carrying value of the asset exceeds the fair value as determined by discounted future cash flows.

In fiscal year 2005 we analyzed goodwill for impairment at the Company level. As a result of the ongoing reorganization of our reporting structure, we anticipate that, in the future, we will have sufficiently discrete financial information to conduct a goodwill impairment analysis at the reporting unit level. This change may affect the amounts recorded for goodwill impairment in future periods.

Based on the impairment tests performed by management, there was no impairment of goodwill in fiscal 2005. There can be no assurance that future goodwill impairment tests will not result in a charge to earnings.

Purchased intangible assets are carried at cost less accumulated amortization. Amortization is computed over the estimated useful lives of the respective assets, generally two to five years.

Legal contingencies

We are currently involved in legal proceedings, certain of which are discussed elsewhere in this Form 10-KSB. We record liabilities related to pending litigation when an unfavorable outcome is probable and we can reasonably estimate the amount of loss. We have not recorded liabilities for certain pending litigation because of the uncertainties related to assessing both the amount and the probable outcome of those claims. As additional information becomes available, we continually assess the potential liability related to pending litigation. While we currently believe that the liabilities recorded on our balance sheet are sufficient to cover pending litigation for which an unfavorable outcome is probable and the amount of loss can be reasonably estimated, the outcome of litigation is inherently uncertain, and there can be no assurance that such estimates will be accurate or that, in the future, additional reserves will not be required.

Income taxes

We account for income taxes in accordance with SFAS No. 109, Accounting for Income Taxes. SFAS 109 prescribes the use of the liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between the financial statement carrying amounts and the tax basis of assets and liabilities. Deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We then assess the likelihood that our deferred tax assets will be recovered from future taxable income and to the extent we believe that recovery is not likely, we establish a valuation allowance. To the extent we establish a valuation allowance, or increase or decrease this allowance in a period, we increase or decrease our income tax provision in our statement of operations. If any of our estimates of our prior period taxable income or loss prove to be incorrect, material differences could impact the amount and timing of income tax benefits or payments for any period. In addition, as a result of the significant change in the Company’s ownership, the Company's future use of its existing net operating losses may be limited.

Stock-Based Compensation

In December 2002, the FASB issued SFAS No. 148 - Accounting for Stock-Based Compensation - Transition and Disclosure. This statement amends SFAS No. 123 - Accounting for Stock-Based Compensation, providing alternative methods of voluntarily transitioning to the fair market value based method of accounting for stock-based employee compensation. SFAS 148 also requires disclosure of the method used to account for stock-based employee compensation and the effect of the method in both the annual and interim financial statements. The provisions of this statement related to transition methods are effective for fiscal years ending after December 15, 2002, while provisions related to disclosure requirements are effective in financial reports for interim periods beginning after December 31, 2002.

We elected to continue to account for stock-based compensation plans using the intrinsic value-based method of accounting prescribed by APB No. 25, “Accounting for Stock Issued to Employees,” and related interpretations. Under the provisions of APB No. 25, compensation expense is measured at the grant date for the difference between the fair value of the stock and the exercise price.

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RESULTS OF OPERATIONS

The following selected financial information has been derived from our consolidated financial statements. The information set forth below is not necessarily indicative of results of future operations and cash flows and should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this Form 10-KSB.

Comparison of Years Ended August 31, 2005 and 2004

Revenues

The Company’s revenues from continuing operations of $32,277 and $24,279, for the years ended August 31, 2005 and 2004, respectively reflect an increase of $7,998 or 32.9%. This increase is not significant due to the early stage of our marketing efforts related to our software products. Revenue in fiscal 2005 relate to software license sales and charges for proof of concept with customers evaluating our software. The revenue in fiscal 2004 relates to consulting services provided to a customer that was evaluating our software. After the disposition of the call center operations in May 2005, all revenues related to those operations have been combined into the caption “loss from discontinued operations”.

Cost of revenues

Cost of revenues decreased $7,712 to zero in 2005 as a result of there being no direct costs associated with the revenue generated during the year ended August 31, 2005.

Selling, General and Administrative

Selling, general and administrative expenses (“SG&A”) during the year ended August 31, 2005 and 2004, including depreciation and amortization were $9,224,887 and $3,521,387, respectively. This increase of $5,703,500 from 2004 was the result of several components including a $4,145,521 charge in 2005 relating to the value of the $.85 exercise price warrants issued in August. We issued warrants for 5,923,335 shares of common stock in conjunction with the conversion of our Series A Preferred Stock into our common stock, the charge to operations was the difference between the $.85 warrant price and the market price of our stock at time of issuance which was $1.44. Legal costs during 2005 totaled $1,092,037 which is an increase of $746,087 over the 2004 total of $345,950. This increase in legal costs was caused by increased litigation defense expenditures relating to our defense in a number of lawsuits many of which have now been settled or dismissed. In addition to legal defense work, we charged to operations approximately $273,026 of legal costs related to our patent filings, preparation and consulting relating to future licensing or sale of our existing patents. Commissions and costs related to the sale of the Senior Convertible Notes of $640,634 and $-0- were charged to expense in 2005 and 2004, respectively.

The additional increase of $171,259 in SG&A is due to increases and declines in several areas, the significant areas of which are discussed below. Personnel costs were $1,499,217 and $1,219,743 in 2005 and 2004, respectively. The decline in personnel costs related to the sale and discontinued operations at the call center was offset by increasing payroll costs related to our software productization activities resulting in a net increase in payroll costs of $279,474 from 2004 to 2005. Rent expense charged to operations was $67,684 and $15,097 in 2005 and 2004, respectively. The increase of $52,587 relates to the expansion and relocation of our Company’s headquarters to Charlotte, NC. Lawsuit settlement costs of $400,000 in 2004 compared to $203,000 in 2005 resulted from fewer matters in litigation. Board of Director compensation was $49,689 and $120,000 in 2005 and 2004, respectively, which was entirely stock grants or options in 2004 resulted from the reduction in number of Board members in 2005 and fewer awards for past and previously unpaid services. Depreciation of equipment and amortization of Patent and Trademark Costs accounted for $55,028 and $42,346 of SG&A in the fiscal year ended August 31, 2005 and 2004, respectively.

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Other Income

Other income of $283,178 for the year ended August 31, 2005 was primarily the result of the settlement of a previously recorded accounts payable liability at a discount of approximately $235,000 and the recognition of approximately $59,000 of income related to the amortization of the discount related to the Notes Receivable.

Interest Expense

Interest expense of $2,319,409 and $131,030 during the years ended August 31, 2005 and 2004, respectively represents an increase of $2,188,379 from 2004 to 2005. The primary factor in this dramatic increase in interest expense was the charge related to the 20% discount on the 6.4% Senior Convertible Notes (“Notes”) sold during fiscal 2005. This charge accounted for $1,289,290 of the increase. The sale of these Notes also resulted in discounts related to the underlying value of the warrants which accompanied the Notes and that related to the value of the conversion feature. This discount is charged to Additional Paid in Capital initially and then amortized with a charge to interest expense. The total amount of these amortization charges was $810,205 and $-0- in 2005 and 2004, respectively. Interest expense in 2005 also includes actual interest paid on these Notes of $68,300 and $-0- was expensed in 2005 and 2004, respectively.

NET OPERATING LOSS

The Company has accumulated approximately $11,900,000 of net operating loss carry forwards as of August 31, 2005, which may be offset against taxable income and income taxes in future years. The use of these losses to reduce future income tax liabilities will depend on the generation of sufficient taxable income prior to the expiration of the net operating loss carry forwards. The carry forwards expire in the year 2026. The February 2003 transaction with the Company’s new controlling shareholders resulted in a change in control of the Company; there will be an annual limitation on the amount of net operating loss carry forwards that can be used.

LIQUIDITY AND CAPITAL RESOURCES

We have successfully completed several steps in our long-range plan to stabilize our financial structure. These steps included the raising of significant equity and debt capital during the years ended August 31, 2005, and 2004, and the sale and restructure of certain corporate assets which were significantly contributing to our on-going losses. The first step in our restructuring process was the offering of our Series A Preferred Stock, which raised approximately $3,000,000 in fiscal year 2004, and approximately $3,000,000 in fiscal year 2005. We also issued Series A Preferred Stock in exchange for $1,051,217 of notes payable to related parties during fiscal 2005. With this capital, we were able to substantially reduce vendor payables and generally enable obligations that were in arrears or default to be paid or settled. In the final quarter of fiscal year 2005, we offered an exchange to the holders of our Series A Preferred Stock which provided for their preferred shares to be exchanged for shares of our Common Stock on a one-for-one basis and warrants to purchase shares of our Common Stock exercisable at $.85 per share. In August 2005, all holders of the Series A Preferred Stock accepted the exchange offer and all of such shares of Series A Preferred Stock were exchanged into 5,923,335 shares of common stock and 5,923,335 warrants exercisable at $.85 per share. We received $563,364 and $366,726 prior to and subsequent to August 31, 2005, respectively, as a result of exercise of these warrants. We thereafter eliminated the Series A Preferred Stock as a designated series of our preferred stock.

In May 2005, we began the offering of a new class of secured debt, our 2005 6.4% Senior Convertible Notes. Through the fourth quarter of fiscal year 2005, we issued $6,446,450 principal amount of these Notes, which were sold at a 20% discount from principal amount, and received proceeds, prior to commissions, of $5,157,160. Additional issuances after fiscal year 2005 resulted in another $150,000 of proceeds, prior to commissions, related to these Notes. The Notes are convertible into one share of our Common Stock for each $1.3325 of principal amount of the Notes. In addition, for each $2.00 of principal amount of the Notes issued, the purchasers of the Notes received a warrant to purchase one share of Common Stock at $1.00 per share. At August 31, 2005, we had issued 3,223,225 of these warrants, 140,625 of which have been exercised resulting in $140,625 of proceeds to us during the year. The proceeds from the issuance of the Notes and the exercise of the warrants will be utilized to further implement our marketing plans for the suite of products discussed above and to monetize our intellectual property portfolio. In May 2005, we sold the assets of our E-Commerce subsidiary. Thereafter, we sold the stock in the E-Commerce subsidiary resulting in the complete divestiture of our call center operations and related liabilities. This resulted in the Company’s current liabilities declining $1,746,762 and eliminated a unprofitable business segment. These steps were critical in providing us with a manageable level of current debt and trade payables, and to lay the foundation to enable us to transform ourselves from a call center dominated operation to a technology based company.

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These steps have resulted in our improved cash position, $2,124,029 at August 2005 compared to $344,099 at August 2004 and a current ratio of greater than 1:1. This foundation, together with approximately 5,100,000 unexercised $.85 warrants and 3,070,000 unexercised $1.00 warrants provides us with the proper capital structure to execute our plans. The exercise of these warrants is not assured but we expect that they will be exercised during the second and third quarters of our fiscal 2006.

Net cash used in operating activities in the years ended August 31, 2005 and 2004, respectively was $5,107,658 and $4,721,885 due to the net loss from continuing and discontinued operations of $12,386,928 and $14,514,854 (excluding gain on sale of discontinued operation of $1,235,785 and $2,784,370, respectively). This was comprised of a net increase (decrease) in working capital items of approximately $446,891and ($380,934). The effect on cash from operating activities caused by these losses were offset by non-cash write off of the impaired goodwill relating to the our Convergion subsidiary that was sold of $-0- and $4,062,003 and depreciation and amortization expenses of $55,028 and $576,115 during fiscal 2005 and 2004, respectively. Additional non-cash expenses that were an offset to the effect on cash from operating activities include $2,090,495 and $-0- of charges related to the discount of and amortization of beneficial conversion features of the Senior Convertible Notes, respectively. There were also certain expenses with the issuance of the Company’s capital stock. The total of expenses paid with the issuance of capital stock and stock options and warrants was $874,189 and $1,224,270 during fiscal 2005 and 2004, respectively.

Net cash used in investing activities in fiscal 2004 was $287,634. This was due to the purchase of certain fixed assets necessary to the operations of the business. Net cash provided by investing activities in fiscal 2005 includes $129,000 of cash received from sale of ecom, and $112,027 of cash used to purchase certain fixed assets.

Cash provided by financing activities in fiscal 2005 and 2004 was $6,870,615 and $5,015,665 due to sales of Senior Convertible Notes and Series A Preferred Stock in 2005 and the sale of Series A and Series B Preferred Shares in 2004. The Company also entered into an accounts receivable financing agreement and advances (repayments) from lender (factor) amounted to ($483,590) and $496,388 during 2005 and 2004, respectively.

By adjusting its operations to the level of capitalization, management believes it has sufficient capital resources to meet projected cash flow deficits. However, if during that period or thereafter, we are not successful in generating sufficient liquidity from operations or in raising sufficient capital resources, on terms acceptable to us, this could have a material adverse effect on our business, results of operations liquidity and financial condition.

The Notes and Warrants that we issued to investors may not have been exempt from the registration requirements under the Securities Act of 1933 or from the registration or qualification requirements under the securities laws of certain states. Consequently, the issuance of the Notes and Warrants may not have been in compliance with the Securities Act of 1933 and the state securities laws of the states of Alabama, Georgia, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia. Our Board of Directors has determined to conduct a rescission offer to address these securities laws compliance issues by allowing the holders of the Notes and Warrants to rescind the purchase of such securities and sell those securities back to us if they so desire. Generally, if the rescission offer is accepted, we will repurchase such Notes and Warrants at the price investors paid, plus interest at the current state statutory rate per year, if any, from the date of purchase through the date of payment pursuant to the rescission offer, less interest previously paid to Note holders. This rescission offer will be accompanied by an exchange offer to Note holders who do not accept the rescission offer pursuant to which such holders will be entitled to receive, at their election, new notes and new warrants with more favorable conversion and exercise terms, respectively. The rescission offer will be available for a thirty-day period which will begin upon the effectiveness of a registration statement which we have filed with the SEC with respect to the rescission offer. While we do not believe a significant number of holders of the Notes and Warrants will accept the rescission offer, there can be no assurances as to the ultimate outcome of the offer. We do not currently have a sufficient balance of cash or cash equivalents to satisfy the rescission offer if accepted by all holders.

Accordingly, should the offer be accepted by a significant number of note holders, this may materially adverse affect on the Company's consolidated financial condition.

EFFECTS OF RECENT ACCOUNTING PRONOUNCEMENTS

In November 2004, the Financial Accounting Standards Board (FASB) issued SFAS 151, Inventory Costs - an amendment of ARB No. 43, Chapter 4. This Statement amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). Paragraph 5 of ARB 43, Chapter 4, previously stated that “…under some circumstances, items such as idle facility expense excessive spoilage, double freight, and rehandling costs may be so abnormal as to require treatment as current period charges…” This Statement requires that those items be recognized as current-period charges regardless of whether they meet the criterion of “so abnormal.” In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities. This Statement is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. Management does not believe the adoption of this Statement will have any immediate material impact in the Company.

In December 2004, the FASB issued SFAS No.152, “Accounting for Real Estate Time-Sharing Transactions—an amendment of FASB Statements No. 66 and 67” (“SFAS 152) The amendments made by Statement 152 This Statement amends FASB Statement No. 66, Accounting for Sales of Real Estate, to reference the financial accounting and reporting guidance for real estate time-sharing transactions that is provided in AICPA Statement of Position (SOP) 04-2, Accounting for Real Estate Time-Sharing Transactions. This Statement also amends FASB Statement No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects, to state that the guidance for (a) incidental operations and (b) costs incurred to sell real estate projects does not apply to real estate time-sharing transactions. The accounting for those operations and costs is subject to the guidance in SOP 04-2. This Statement is effective for financial statements for fiscal years beginning after June 15, 2005, with earlier application encouraged. The Company does not anticipate that the implementation of this standard will have a material impact on its financial position, results of operations or cash flows.

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On December 16, 2004, the Financial Accounting Standards Board (“FASB”) published Statement of Financial Accounting Standards No. 123 (Revised 2004), Share-Based Payment (“SFAS 123R”). SFAS 123R requires that compensation cost related to share-based payment transactions be recognized in the financial statements. Share-based payment transactions within the scope of SFAS 123R include stock options, restricted stock plans, performance-based awards, stock appreciation rights, and employee share purchase plans. The provisions of SFAS 123R are effective as of the first interim period that begins after June 15, 2005. Accordingly, the Company will implement the revised standard in the third quarter of fiscal year 2005. Currently, the Company accounts for its share-based payment transactions under the provisions of APB 25, which does not necessarily require the recognition of compensation cost in the financial statements. Management is assessing the implications of this revised standard, which may materially impact the Company’s results of operations in the third quarter of fiscal year 2005 and thereafter.

On December 16, 2004, FASB issued Statement of Financial Accounting Standards No. 153, Exchanges on Nonmonetary Assets, an amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions (“SFAS 153”). This statement amends APB Opinion 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance. Under SFAS 153, if a nonmonetary exchange of similar productive assets meets a commercial-substance criterion and fair value is determinable, the transaction must be accounted for at fair value resulting in recognition of any gain or loss. SFAS 153 is effective for nonmonetary transactions in fiscal periods that begin after June 15, 2005. The Company does not anticipate that the implementation of this standard will have a material impact on its financial position, results of operations or cash flows.

In March 2005, the FASB issued FASB Interpretation (FIN) No. 47, “Accounting for Conditional Asset Retirement Obligations, an interpretation of FASB Statement No. 143”, which requires an entity to recognize a liability for the fair value of a conditional asset requirement obligation when incurred of the liability’s fair value can be reasonably estimated. The Company is required to adopt the provisions of FIN 47 no later than the second quarter of its fiscal 2006. The Company does not expect the adoption of this Interpretation to have a material impact on its consolidated financial position, results of operations or cash flows.

In May 2005 the FASB issued Statement of Financial Accounting Standards (SFAS) No. 154, “Accounting Changes and Error Corrections, a replacement of APB Opinion No. 20 and FASB Statement No. 3.” SFAS 154 requires retrospective application to prior periods’ financial statements for changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. SFAS 154 also requires that retrospective application of a change in accounting principle be limited to the direct effects of the change. Indirect effects of a change in accounting principle, such as a change in non-discretionary profit-sharing payments resulting from an accounting change, should be recognized in the period of the accounting change. SFAS 154 also requires that a change in depreciation, amortization, or depletion method for long-lived, non-financial assets be accounted for as a change in accounting estimate effected by a change in accounting principle. SFAS 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Early adoption is permitted for accounting changes and corrections of errors made in fiscal years beginning after the date this Statement is issued. The Company does not expect the adoption of this SFAS to have a material impact on its consolidated financial position, results of operations or cash flows.

 

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INFLATION

Our opinion is that inflation has not had a material effect on our operations.

OFF-BALANCE SHEET ARRANGEMENTS

We do not maintain off-balance sheet arrangements, nor do we participate in non-exchange traded contracts requiring fair value accounting treatment.

DESCRIPTION OF PROPERTY

Our principal executive offices are located at 6701 Carmel Road Suite 205, Charlotte, NC 27226. This facility is leased through September 2010 and covers approximately 5,000 square feet at an approximate annual rental rate of $85,000. We believe our current premises are adequate for current purposes and if necessary that we would be able to obtain alternative or additional space.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Placement Agent Commissions

The firm of Jones Byrd & Attkisson, Inc. has acted as Placement Agent for our prior offerings of Notes and Warrants and the Series A Preferred Stock. In connection with such offerings, the Placement Agent has received $803,207 in cash commissions and warrants to purchase 1,817,887 shares of our Common Stock at cashless exercise prices ranging from $1.00 to $1.3325. Additionally, we have agreed to pay fees to the Placement Agent, if allowed by applicable state law, in the event that holders convert certain notes or exercise certain warrants. Ronald L. Attkisson, one of our directors, is a principal of the Placement Agent. Cynthia White, our Vice President and Chief Operating Officer, has been the Financial and Operating Principal and CFO for the Placement Agent from August 2003 to the present. Ms. White will end that consulting arrangement at such time that the Placement Agent transitions her position to her successor.

TAG/Convey Transaction

Scientigo has entered into a non-binding letter of intent to purchase substantially all of the assets of The Tag Group, Inc., or TAG. These assets consist of cash, accounts receivable and certain proprietary products in the areas of web conferencing and collaboration and web-based PC support tools. Subject to the execution of definitive agreements, this transaction is now expected to be completed in late calendar year 2005. Audit issues relating to TAG caused the delays. TAG and its wholly-owned subsidiary, Convey Systems, Inc., or Convey, and Scientigo have executed an agreement whereby Scientigo is providing day-to-day management for Convey. Scientigo has received the net proceeds from sales of Convey products since April 15, 2004, and will continue to do so through the closing. The purchase price of these assets plus related expenses is expected to be up to approximately 1,180,488 shares of Scientigo's Common Stock. Doyal Bryant, President and Chief Executive Officer of Scientigo, is the beneficial owner of approximately 49% of the outstanding Common Stock of TAG. In such capacity, Mr. Bryant would have received a significant number of shares of our Common Stock in the event that the TAG/Convey transaction is consummated. Mr. Bryant has agreed to forego the receipt of any such shares and has no financial interest in the consummation of the TAG/Convey transaction. Mr. Thomas Gordy, a former director of Scientigo, received 300,000 warrants to purchase shares of Common Stock of Scientigo at $1.60 per share for providing services to Scientigo in connection with the transaction.

Recapitalization Transactions

In November 2004, after discussions with management regarding the capital structure of Scientigo, Scientigo's two largest beneficial stockholders (William A. Goldstein and Glen Hammer) notified Scientigo that they would return 5,880,740 shares of Common Stock to Scientigo's treasury, cancel warrants that they owned which provided them with the right to purchase approximately 2,300,000 shares of Common Stock in Scientigo, resign from Scientigo's Board of Directors and seek to convert approximately $1,000,000 in demand notes due from Scientigo into shares of Scientigo's Series A Preferred Stock. The purpose of the proposed transactions was to restructure the capitalization of Scientigo so that it could more readily raise additional capital needed to continue management's efforts to monetize the value of Scientigo's intellectual property portfolio. Mr. Goldstein returned 2,940,370 shares of Common Stock, cancelled warrants to purchase 2,300,000 shares of Common Stock (held jointly by Messrs. Goldstein and Hammer) and converted $701,786 of indebtedness into shares of Scientigo's Series A Preferred Stock effective April 22, 2005. Mr. Hammer was unable to return his shares of Common Stock to Scientigo because they were pledged as collateral for the repayment of his indebtedness. Therefore, Scientigo's bank debt of approximately $1,250,000 was assumed by Mr. Hammer in exchange for a note payable from Scientigo effective December 2004. At that time, Scientigo was released from such bank debt. This new note provided for interest only, at LIBOR plus 2.75%, through the earlier of when Mr. Hammer returned 2,940,370 shares of Common Stock to Scientigo, but no later than April 30, 2005. Effective April 20, 2005, Scientigo and Mr. Hammer entered into an agreement which terminated earlier agreements and provided for the contribution of 3,100,000 shares of Common Stock to Scientigo by Mr. Hammer. In return, Scientigo agreed to lend Mr. Hammer $400,000 of the proceeds of the Note Offering for the purpose of discharging indebtedness of Mr. Hammer, enter into a loan agreement with Mr. Hammer as previously agreed to including the payment of approximately $150,000 of the $1,250,000 principal of such indebtedness and issue Mr. Hammer 262,238 shares of the Series A Preferred Stock in payment of all other outstanding indebtedness of Scientigo to such stockholder. The $400,000 loan is being repaid out of the proceeds of the sale of a portion of the remaining shares of the Common Stock owned by Mr. Hammer and in any event is due not later than one (1) year from the date of such loan. All of such transactions were completed on May 31, 2005. In connection with these transactions, Mr. Hammer provided management with a proxy to vote his shares of Common Stock at the 2005 annual meeting of our stockholders. Neither Mr. Goldstein nor Mr. Hammer have any continuing interest in Scientigo other than as holders of Common Stock and warrants to purchase Common Stock.

During the years ended August 31, 2005 and 2004, we provided services through our E-commerce subsidiary to three companies owned by former directors and/or officers of the Company. All of the revenue from these services are now included in the loss from discontinued operations. The amount of revenue included in this loss from discontinued operations is $-0- and $1,162,691 from Gibraltar Publishing, Inc., for the years ended August 31, 2005 and 2004, respectively. J&C Nationwide, Inc. and Cheapseats, Inc. revenues of $151,616 and $613,774 were also included in this loss from discontinued operations for the years ended August 31, 2005 and 2004, respectively.

At August 31, 2005, we had made payments totaling $81,090 on behalf of The Tag Group, Inc. in anticipation of the purchase of substantially all of their assets. These payments to various vendors will be deducted from the purchase price paid to The Tag Group, Inc. at the closing of the purchase transaction.

We previously leased office space to Gilbralter, owned by a former officer and director of Scientigo, in our former facility in Jacksonville, North Carolina. We no longer occupy the space and therefore no longer lease the space to Gilbralter.

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MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

The Company’s Common Stock has been traded on a limited basis in the over-the-counter market and quotations are published on the OTC Bulletin Board under the symbol “MKTE.OB”, and in the National Quotation Bureau, Inc. “pink sheets” under Market Central, Inc.

The following table sets forth the range of high and low bid prices of the Common Stock for each fiscal quarter in the last two fiscal years. Prices reported represent prices between dealers, do not include retail markups, markdowns or commissions and may not represent actual transactions.

	Fiscal Year
	2005				2004
	High		Low		High		Low
First Quarter	$	1.85	$	1.25	$	3.30	$	1.91
Second Quarter		1.56		1.15		2.19		1.60
Third Quarter		2.13		1.25		1.85		1.05
Fourth Quarter		1.80		1.35		1.96		.95

The ability of individual stockholders to trade their shares in a particular state may be subject to various rules and regulations of that state. A number of states require that an issuer’s securities be registered in their state or appropriately exempted from registration before the securities are permitted to trade in that state. Presently, the Company has no plans to register its securities in any particular state. Further, most likely the Company’s shares will be subject to the provisions of Section 15(g) and Rule 15g-9 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), commonly referred to as the “penny stock” rule. Section 15(g) sets forth certain requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.

The Commission generally defines penny stock to be any equity security that has a market price less than $5.00 per share, subject to certain exceptions. Rule 3a51-1 provides that any equity security is considered to be a penny stock unless that security is: registered and traded on a national securities exchange meeting specified criteria set by the Commission; authorized for quotation on The NASDAQ Stock Market; issued by a registered investment company; excluded from the definition on the basis of price (at least $5.00 per share) or the issuer’s net tangible assets (at least $2 million); or exempted from the definition by the Commission. If the Company’s shares are deemed to be a penny stock, trading in the shares will be subject to additional sales practice requirements of broker-dealers who sell penny stocks to persons other than established customers and accredited investors, generally persons with assets in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together with their spouse.

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For transactions covered by these rules, broker-dealers must make a special suitability determination for the purchase of such securities and must have received the purchaser’s written consent to the transaction prior to the purchase. Additionally, for any transaction involving a penny stock, unless exempt, the rules require the delivery, prior to the first transaction, of a risk disclosure document relating to the penny stock market. A broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative, and current quotations for the securities. Finally, monthly statements must be sent disclosing recent price information for the penny stocks held in the account and information on the limited market in penny stocks. Consequently, these rules may restrict the ability of broker-dealers to trade and/or maintain a market in the Company’s Common Stock and may affect the ability of stockholders to sell their shares.

As of October 17, 2005, there were 301 holders of record of the Company’s Common Stock. This amount does not take into account those stockholders whose certificates are held in the name of broker-dealers or otherwise in street or nominee name.

DIVIDEND POLICY

The Company has not declared or paid cash dividends on its Common Stock or made distributions in the past, and the Company does not anticipate that it will pay cash dividends in the foreseeable future. In addition, the Company has a deficit stockholders’ equity, which would restrict payment of cash dividends. The Company currently intends to retain and invest future earnings to finance its operations.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The following table sets forth as of August 31, 2005, the number of common shares to be issued upon the exercise of outstanding warrants, options and rights related to those arrangements and transactions as defined in §201(d) of Regulation S-B.  

Plan Category	Number of securities to be issued upon exercise of outstanding options, warrants and rights			Weighted average exercise price of outstanding options, warrants and rights		Number of securities remaining available for future issuance
Equity compensation plans approved by security holders		551,424	a	$	2.03		2,198,576
Equity compensation plans not approved by security holders		8,151,958	b	$	1.26		43,250,555
Total		8,703,382		$	1.31		45,449,131

^a Includes shares of common stock issuable upon the exercise of stock options and warrants issued pursuant to individual compensation arrangements (as such term is defined in under Regulation S-B §201(d) promulgated under the Exchange Act) in consideration for goods and services provided by certain of our employees, consultants, vendors, customers, suppliers and lenders. Generally, the warrants and options that are granted pursuant to individual compensation arrangements are generally exercisable for a term of four years and have exercise price equal to the fair market value of our common stock at the time of the warrant/option issuance.

^b As these shares of common stock are issued pursuant to individual compensation arrangements, there is no reserve for future issuances other than the total number of authorized shares of common stock available to us under our Certificate of Incorporation.

TRANSFER AGENT

The Company has designated American Stock Transfer and Trust Company, 59 Maiden Lane, New York, NY, as its transfer agent for the Common Stock.

During the fiscal year ended August 31, 2005, the Company issued 6,769,669 shares of common stock and cancelled 6,840,370 shares of common stock upon the contribution of such shares by two major stockholders and the completion of the agreement with our former President. The issuances included 83,000 shares for services rendered by vendors, 31,064 to employees for compensation, 35,000 to Board of Director members as compensation, 235,970 upon exercises of options, 461,300 upon exercises of warrants and 5,923,335 issued as a result of the conversion of all of our Series A Preferred Stock into common shares. The cancellations related to the return of shares reflected as common stock receivable in the 2004 financial statements. These shares were issued pursuant to exemptions from the registration requirements of the Securities Act of 1933 under Sections 3 (a) (9) and 4(2) thereof.

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EXECUTIVE COMPENSATION

Our directors who are not our employees (“outside directors”) receive an annual director’s fee of $20,000 ($25,000 for the Chairman of our Audit Committee). In addition, each outside director upon his first election as a member of our board receives a grant of nonqualified stock options with an exercise price of the fair market value of our Common Stock at the time of grant. These options vest one-third immediately, one-third on the first anniversary of grant and one-third on the second anniversary of grant provided that such outside director remains a director on such anniversaries. Directors who are employed by us do not receive additional consideration for serving as directors, except that all directors are entitled to reimbursement for travel and out-of-pocket expenses in connection with their attendance at board and committee meetings.

On September 22, 2005, we granted each of our three outside directors, Messrs. Yarbrough, Attkisson and Lowder options to purchase 300,000 shares of our Common Stock at an exercise price of $1.35 per share for a term of five years.

The following Summary Compensation Table sets forth all compensation actually paid or accrued by us for services rendered to us for the years ended August 31, 2003, 2004 and 2005. to our Chief Executive Officer and former Chief Executive Officer and two other executive officers in fiscal 2005:

Name and Principal Position	Year		Salary ($)		Bonus ($)		Other Annual Compensation ($)		Securities Underlying Options
Doyal G. Bryant, CEO (1)		2005	$	180,000		None	$	13,026		________
		2004	$	-0-		None		None		________
		2003	$	-0-
Paul S.Odom, Senior Vice President - Software Apps and Solutions (2)		2005	$	120,000		None		None		________
		2004	$	120,000		None		None		________
Clifford A. Clark, CFO (3)		2005	$	120,000		None	$	8,097		________
		2004 2003	$ $	55,000 55,000		None None		None None		________

(1) Mr. Bryant became our CEO in April 2004 but was not compensated directly by us until October 2004. Payments to The Tag Group, Inc. during fiscal 2004 which then compensated Mr. Bryant were $40,000. Mr. Bryant also received warrants in exchange for salary deferrals from October 2004 through April 2005 that were priced below market at the time of issuance, the amount by which market value at issuance exceeded exercise price is included as compensation and shown as Other Annual Compensation of $13,026.

(2) Mr. Odom has been an employee since July 2004 and his title was changed in fiscal 2005 to Senior Vice President - Software Applications and Solutions.

(3) Mr. Clark became our CFO in 2001. Mr. Clark also received warrants in exchange for salary deferrals from September 2004 through April 2005 that were priced below market at the time of issuance, the amount by which market value at issuance exceeded exercise price is included as compensation and shown as Other Annual Compensation of $8,097.

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Employee Stock Option Plan

Our 2003 Amended and Restated Stock Plan (the "Plan"), assumed the 1996 Stock Option Plan, which was adopted in 1996 and amended in October 1997, July 2001, October 2003 and December 2003 to increase the number of issuable shares under the Plan to 3,000,000 shares of common stock. The purpose of the Plan is to encourage stock ownership by our management and employees, to provide an additional incentive for those employees to contribute to our success and to provide us with the opportunity to use stock options as a means of recruiting new managerial personnel where appropriate.

The Plan authorizes the grant of options which qualify as incentive stock options under Section 422A of the Internal Revenue Code ("qualified options"), as well as stock options which do not qualify under that section of the Code ("nonqualified options"). The Plan is administered by our Board of Directors who may delegate these duties to the Compensation Committee. The Board is authorized to select the individual employees to receive options under the Plan, the number of shares subject to each option, the option term and other matters specified in the Plan.

The Plan provides that the exercise price of any option may not be less than 100% of the fair market value of our stock at the date of grant, defined as the average bid and ask price over the prior five days' trading in which at least 1,000 shares have traded. Options must be granted within ten years from the date the Plan was approved by our shareholders.

A maximum of 3,000,000 shares of our Common Stock are authorized for issuance pursuant to options granted under the Plan, subject to adjustments to prevent dilution or enlargement of rights of participants in certain circumstances. As of August 31, 2005, 5,801,424 options were outstanding, 551,424 of which were issued inside the Plan. As of August 31, 2005, 518,092 shares are exercisable at an option price per share ranging from $.01 to $3.16 per share and with expiration dates from February 2005 through February 2009.

Profit Sharing Plan

We sponsor a qualified employee savings plan (commonly referred to as a “401K plan”) for all eligible employees, including all of our officers. Participants may make contributions from their gross pay (limited to 15% of the employee’s compensation, as defined up to $14,000 annually). We do not match any contributions. No other deferred compensation plan is currently in place.

Employment Agreements

We have employment agreements with three of our executive officers: Doyal G. Bryant, CEO, Clifford A. Clark, CFO and Paul S. Odom, Senior Vice President.

Mr. Bryant’s contract provides for an annual salary of $180,000 and will terminate on October 7, 2007. The contract provides for compensation in the case of a change of control of our Company which if Mr. Bryant elects to resign shall equal twice his annual salary and all unvested stock options immediately vesting. Compensation in the case of termination without cause provides for normal payout of the contract plus nine months additional compensation. The contract also provides for options for 4,000,000 shares of our common stock. These are divided into four equal traunches of 1,000,000 at prices of $1.60, $2.00, $2.25 and $2.50, respectively. The first 1,000,000, which are exercisable at $1.60, have vested; the remaining 3,000,000 options will vest upon achieving certain stock price goals.

Mr. Odom’s contract provides for an annual salary of $150,000 and terminates on January 14, 2009. The contract provides for compensation in the case of a change of control of our Company which if Mr. Odom elects to resign shall equal twice his annual salary and all unvested stock options immediately vesting. Compensation in the case of termination without cause provides for normal payout of the contract but must be no less than 24 months. The contract provides for options for 600,000 shares of our common stock. These are divided into three equal traunches of 200,000 at prices of $1.60, $2.00 and $2.25, respectively. The first 200,000, which are exercisable at $1.60, have vested; the remaining 400,000 options will vest upon achieving certain stock price goals.

Mr. Clark’s contract provides for an annual salary of $120,000 and will terminate on August 30, 2007. The contract provides for compensation in the case of a change of control of our Company which if Mr. Clark elects to resign shall equal twice his annual salary and all unvested stock options immediately vesting. Compensation in the case of termination without cause provides for normal payout of the contract but must be no less than 24 months. The contract provides for options for 375,000 shares of our common stock. These are divided into three equal traunches of 125,000 at prices of $1.60, $2.00 and $2.25, respectively. The first 125,000, which are exercisable at $1.60, have vested; the remaining 250,000 options will vest upon achieving certain stock price goals.

105

USE OF PROCEEDS

There will be no proceeds to us from the Rescission Offer or the Exchange Offer. However, any proceeds we receive from the exercise of outstanding warrants for cash will be used for working capital and for potential strategic acquisitions. Any such proceeds from the exercise of A Warrants and B Warrants will be net of fees that we have agreed to pay to the Placement Agent, if allowed by applicable state law, in the event that holders of A Warrants or B Warrants exercise such Warrants (in an amount equal to 10% of the aggregate exercise price of the Warrants exercised).

PLAN OF DISTRIBUTION

The securities described in this prospectus will be issued to our holders of Notes and Warrants by us in accordance with the procedures and upon the conditions set forth at “The Rescission Offer” and “The Exchange Offer.” We will receive no proceeds from either the Rescission Offer or the Exchange Offer.

Following the completion of the Rescission Offer and the Exchange Offer, holders of Notes and Warrants or A Notes and A Warrants will be entitled to convert their notes and exercise their warrants as described in this prospectus and receive registered shares of our Common Stock if such conversions and exercises occur prior to the expiration of the Offering Period. In such event, we will issue registered freely tradable shares of our Common Stock to the holders who properly convert and/or exercise their notes and warrants.

We have agreed to pay fees to Jones Byrd & Attkisson, Inc. (the “Placement Agent”), if allowed by applicable state law, in the event that following completion of the Exchange Offer, (i) holders of A Notes or B Notes elect to convert such notes into shares of our Common Stock (in the amount of 6% of the New Principal Amount of A Notes and B Notes converted), or (ii) holders of A Warrants and B Warrants exercise such warrants (in an amount equal to 10% of the aggregate exercise price of such warrants exercised). This will not, however, affect your rights as a holder of either the A Notes or the B Notes and A Warrants and B Warrants or in any way limit the number of shares of our Common Stock you receive upon such conversion or exercise. Ronald L. Attkisson, a director of Scientigo, is a principal of the Placement Agent.

LEGAL MATTERS

The legality of the securities being offered hereby will be passed upon for us by Greenberg Traurig, LLP, Atlanta, Georgia.

AVAILABLE INFORMATION

We have filed with the Securities and Exchange Commission a registration statement on Form S-4 under the Securities Act with respect to the securities offered by this prospectus. This prospectus, which forms a part of the registration statement, does not contain all the information set forth in the registration statement, as permitted by the rules and regulations of the Commission. For further information with respect to us and the securities offered by this prospectus, reference is made to the registration statement. Statements contained in this prospectus as to the contents of any contract or other document that we have filed as an exhibit to the registration statement are qualified in their entirety by reference to the to the exhibits for a complete statement of their terms and conditions. The registration statement and other information may be read and copied at the Commission's Public Reference Room at 100 F Street N.E., Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the Commission at 1-800-SEC-0330. The Commission maintains a web site at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the Commission. Our filings are made under our legal name “Market Central, Inc.”

106

FINANCIAL STATEMENTS

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FINANCIAL STATEMENTS AND SCHEDULES

AUGUST 31, 2005 AND 2004

FORMING A PART OF ANNUAL REPORT

PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934

MARKET CENTRAL, INC.

F-1

MARKET CENTRAL, INC.

INDEX TO FINANCIAL STATEMENTS

	Page
Report of Independent Registered Certified Public Accounting Firm	F-3
Consolidated Balance Sheets at August 31, 2005 an 2004	F-4
Consolidated Statements of Losses for The Years Ended August 31, 2005 and 2004	F-5
Consolidated Statements of Deficiency in Stockholders' Equity for The Years Ended August 31, 2005 and 2004	F-6 ~ F-7
Consolidated Statements of Cash Flows for The Years Ended August 31, 2005 and 2004	F-8 - F-9
Notes to Consolidated Financial Statements	F-10 ~ F-36

F-2

RUSSELL BEDFORD STEFANOU MIRCHANDANI LLP

CERTIFIED PUBLIC ACCOUNTANTS

REPORT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM

Board of Directors

Market Central, Inc.

Charlotte, NC

We have audited the accompanying consolidated balance sheets of Market Central, Inc. and subsidiaries (the "Company") as of August 31, 2005 and 2004 and the related consolidated statements of losses, deficiency in stockholders' equity, and cash flows for each of the two years ended August 31, 2005. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based upon our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States of America). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company and subsidiaries as of August 31, 2005 and 2004, and the results of its operations and its cash flows for each of the two years ended August 31, 2005, in conformity with accounting principles generally accepted in the United States of America.

/s/ RUSSELL BEDFORD STEFANOU MIRCHANDANI LLP

Russell Bedford Stefanou Mirchandani LLP

Certified Public Accountants

McLean, Virginia

October 4, 2005, except as to Note R, which is as of

November 7, 2005

F-3

MARKET CENTRAL, INC.

CONSOLIDATED BALANCE SHEETS

AUGUST 31, 2005 AND 2004

	2005			2004
ASSETS
Current Assets:
Cash and cash equivalents	$	2,124,029		$	344,099
Accounts receivable, net of allowance for doubtful accounts of $0 at August 31, 2005 and 2004		10,000			719,262
Accounts receivable - related parties, net of allowance for doubtful accounts of $0 at August 31, 2005 and 2004 (Note M)		-			277,119
Other receivable - related party (Note M)		81,090			-
Notes receivable - related parties (Notes F )		378,003
Prepaid expenses and other current assets		124,777			149,282
Total Current Assets		2,717,899			1,489,762
Property and Equipment: (Note D)
Furniture and fixtures		69,526			42,273
Computers and software		185,985			101,211
		255,511			143,484
Less: accumulated depreciation		(120,349	)		(97,761	)
Property and Equipment, net		135,162			45,723
Net assets from discontinued operations (Note B)					870,827
Other Assets:
Restricted Cash (Note C)					109,617
Goodwill (Note B)		745,050			745,050
Deposits and other		2,524			25,308
Patents and trademarks, net of accumulated amortization of $64,880 and $32,440 at August 31, 2005 and 2004, respectively (Note E)		32,338			64,778
Total Other Assets		779,912			944,753
Total Assets	$	3,632,973		$	3,351,065
LIABILITIES AND DEFICIENCY IN STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued liabilities (Note H)	$	2,123,810		$	3,442,462
Note payable to related parties (Note G and M)		365,148			1,210,474
Notes payable, current portion (Note G)		-			1,830,422
Due to factor (Note J)					483,590
Accrued preferred stock dividend (Note F)					61,067
Unearned income (Note K)		181,101			-
Total Current Liabilities		2,670,059			7,028,015
Senior Convertible Notes Payable (Note I)		1,354,770
Notes payable - long term (Note G)		793,921
Other long term liabilities		546
Commitments and Contingencies (Note Q)		-			-
Liabilities from discontinued operations (Note B)					1,598,434
Deficiency in Stockholders' Equity:
Preferred stock, par value $.001 per share; 10,000,000 shares authorized;
Series A - none and 2,251,407 shares issued and outstanding at August 31, 2005 and 2004, respectively (Note K)					2,251
Series B - 350,000 shares issued and outstanding at August 31, 2004 (Note K)		350			350
Common stock, par value $.001 per share; 75,000,000 shares authorized; 13,320,992 and 13,391,693 shares issued and outstanding at August 31, 2005 and August 31, 2004, respectively (Note K)		13,321			13,392
Common stock receivable (Note M)		-			(800	)
Stock subscription payable (Note K)		102,064
Additional paid-in-capital		43,278,143			27,672,231
Accumulated deficit		(44,580,201	)		(32,962,808	)
Total Deficiency in Stockholders' Equity		(1,186,323	)		(5,275,384	)
Total Liabilities and Deficiency in Stockholders' Equity	$	3,632,973		$	3,351,065

See accompanying notes to consolidated financial statements

F-4

MARKET CENTRAL, INC.

CONSOLIDATED STATEMENTS OF LOSSES

FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

	2005			2004
Revenues, net	$	32,277		$	24,279
Cost of sales		-			7,712
Gross profit		32,277			16,567
Operating expenses:
Selling, general and administrative		9,169,859			3,479,041
Depreciation and amortization (Note D and E)		55,028			42,346
Total operating expenses		9,224,887			3,521,387
Loss from operations		(9,192,610	)		(3,504,820	)
Other income		283,178			-
Interest expenses		(2,319,409	)		(131,030	)
Total other expenses		(2,036,231	)		(131,030	)
Loss from continuing operations, before income taxes and discontinued operations		(11,228,841	)		(3,635,850	)
Provision for income taxes		-			-
Loss from continuing operations, before discontinued operations		(11,228,841	)		(3,635,850	)
Loss from discontinued operations (Note B)		(1,196,936	)		(6,831,687	)
Gain from sales of discontinued operations (Note B)		1,235,785			2,784,370
Net (loss)	$	(11,189,992	)	$	(7,683,167	)
Preferred stock dividend - beneficial conversion feature (Note K)					(875,000	)
Cumulative convertible preferred stock dividend (Note K)		(427,401	)		(61,067	)
Net loss attributable to common shareholders	$	(11,617,393	)	$	(8,619,234	)
Net income (loss) per common share (basic and assumed diluted) (Note O)	$	(0.90	)	$	(0.65	)
Continuing operations:		(0.90	)		(0.34	)
Discontinued operations:		0.00			(0.31	)
Weighted Average Shares Outstanding
Basic and assumed diluted		12,884,516			13,293,655

See accompanying notes to the consolidated financial statements

F-5

MARKET CENTRAL, INC.

CONSOLIDATED STATEMENTS OF DEFICIENCY IN STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

	Common Shares		Stock Amount		Series A Shares		Series A Par Value		Series B Shares		Series B Par Value		Additional Paid-In-Capital			Common Stock Receivable			Accumulated Deficit			Total
Balance at August 31, 2003	13,268,969		$13,269		-		$-		-		$-		$21,876,847			$-			$(24,343,574)			$(2,453,458)
Issuance of Series A Preferred Stock in connection with a private placement, net of costs and fees (Note K)		-		-		2,251,407		2,251		-		-		2,770,009			-			-			2,772,260
Issuance of common stock to consultants in exchange for options exercised at $.01 per share (Note K)		67,500		68		-		-		-		-		91,800			-			-			91,868
Issuance of Series B Preferred Stock in connection with a private placement, net of costs and fees (Note K)		-		-		-		-		350,000		350		1,282,562			-			-			1,282,912
Warrants issued to consultants in exchange financing costs (Note L)		-		-		-		-		-		-		383,579			-			-			383,579
Stock options and warrants issued to consultants in exchange for services rendered (Note L)		-		-		-		-		-		-		649,939			-			-			649,939
Beneficial conversion feature of Series B Preferred Stock (Note K)		-		-		-		-		-		-		875,000			-			(875,000	)		-
Common stock issued to Directors in exchange for compensation (Note K)		55,224		55		-		-		-		-		98,829			-			-			98,884
Common stock to be canceled in connection with Settlement Agreement and Mutual Release with the Company's former CEO (Note M)		-		-		-		-		-		-		(356,334	)		(800	)		-			(357,134	)
Series A preferred dividend accrual (Note K)		-		-		-		-		-		-					-			(61,067	)		(61,067	)
Net loss		-		-		-		-		-		-		-			-			(7,683,167	)		(7,683,167	)
Balance at August 31, 2004		13,391,693	$	13,392		2,251,407	$	2,251		350,000	$	350	$	27,672,231		$	(800	)	$	(32,962,808	)	$	(5,275,384	)

See accompanying notes to the consolidated financial statements

F-6

MARKET CENTRAL, INC.

CONSOLIDATED STATEMENTS OF DEFICIENCY IN STOCKHOLDERS' EQUITY (Continued)

FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

	Common Shares			Stock Amount			Series A Shares		Series A Par Value		Series B Shares		Series B Par Value		Stock Subscription Payable		Additional Paid-In-Capital			Common Stock Receivable			Accumulated Deficit			Total
Balance forward		13,391,693		$	13,392			2,251,407	$	2,251		350,000	$	350	$	-0-	$	27,672,231		$	(800	)	$	(32,962,808	)	$	(5,275,384	)
Issuance of Series A Preferred Stock in connection with a private placement, net of costs and fees (Note K)		-			-			2,516,270		2,516		-		-				2,966,834			-			-			2,969,350
Issuance of Series A Preferred Stock in conjunction with conversion of debt (Note K and M)								788,906		789								1,050,428									1,051,217
Issuance of common stock to employees in exchange for options exercised at $.01 per share (Note K)		235,970			236			-		-		-		-				188,824			-			-			189,060
Common stock canceled in connection with Settlement Agreement and Mutual Release with the Company's former CEO (Note M)		(800,000	)		(800	)															800			-			-0-
Common stock canceled in conjunction with return of common stock by the Company’s two significant shareholders (Note K)		(5,880,740	)		(5,881	)						-		-				5,881						-			-0-
Common stock canceled in conjunction with return of common stock and loan to shareholder (Note F and M)		(159,630	)		(160	)						-		-				(239,285	)		-			-			(239,445	)
Issuance of common stock to consultants in exchange for services rendered (Note K)		83,000			83							-		-				107,817									107,900
Stock options and warrants issued to consultants in exchange for services rendered (Note L)																		127,987			-			-			127,987
Beneficial conversion feature of 6.4% Senior Convertible Notes and related Warrants (Note I)		-			-			-		-		-		-				5,901,885			-			-			5,901,885
Common stock issued to Directors in exchange for compensation (Note K)		35,000			35							-		-				48,765			-			-			48,800
Issuance of common stock to employees in exchange for compensation (Note K)		31,064			31													44,485									44,516
Warrants issued to lender in exchange for cancellation of financing agreement (Note L)																		64,019									64,019
Warrants issued to officers in exchange for salary deferrals (Note L)																		21,123									21,123
Issuance of common stock in conjunction with exercise of warrants issued with 6.4% Senior Convertible Notes and with Series A Preferred Stock exchange offer and payment of preferred stock dividend (Note K)		461,300			461													412,743									413,204
Common stock issued in conjunction with Series A Preferred Stock exchange offer (Note K)		5,923,335			5,923			5,556,583		5,556								488,101						(427,401	)		61,067
Warrants issued as commissions for Senior Convertible Note Sales (Note L)																		270,784									270,784
Warrants issued with Series A exchange offer (Note L)																		4,145,521									4,145,521
Stock subscription payable (Note K)																102,064											102,064
Net loss					-			-		-		-		-		-		-			-			(11,189,992	)		(11,189,992	)
Balance at August 31, 2005		13,320,992		$	13,321			-0-	$	-0-		350,000	$	350	$	102,064	$	43,278,143		$	-0-		$	(44,580,201	)	$	(1,186,323	)

See accompanying notes to the consolidated financial statements

F-7

MARKET CENTRAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

Cash flows from operating activities:	2005			2004
Net loss	$	(11,189,992	)	$	(7,683,167	)
Add (deduct):
Loss on discontinued operations		1,196,936			6,831,687
Gain on disposal of discontinued operations		(1,235,785	)		(2,784,370	)
Loss from continuing operations		(11,228,841	)		(3,635,850	)
Adustrnent to reconcile net loss to net cash:
Depreciation and amortization		55,028			42,346
Depreciation and amortization - ecom subsidiary					533,769
Impairment of goodwill discontinued operations					4,062,003
Warrants issued in conjunction with conversion of Series A Preferred Stock into Common Stock		4,145,521
Discount on Senior Convertible notes charged to operations		2,090,495
Common stock issued in exchange for services rendered		390,276			190,752
Stock options and warrants issued in exchange for services rendered		483,913			1,033,518
Other income from settlement of accounts payable		(235,661	)
Other income from amortization of note receivable discount		(58,344	)
Write-off of inventory		-			9,678
Write-off of Convergion fixed assets		-			254,520
(Increase) decrease in:
Restricted cash		109,617			(109,617	)
Accounts receivable and other receivable		476,556			266,344
Costs in excess of billings		-			50,446
Other assets		47,289			(30,210	)
Increase (decrease) In:
Cash disbursed in excess of available funds		-			(111,581	)
Accounts payable and accrued expenses		(186,571	)		(215,257	)
Unearned income					(231,059	)
Net cash provided by/(used in) continuing operations		(3,910,722	)		2,109,802
Net cash (used in) discontinued operations		(1,196,936	)		(6,831,687	)
Net cash (used in) Operating Activities		(5,107,658	)		(4,721,885	)
Cash flows from investing activities:
Cash received from sale of ecom		129,000
Purchase of property and equipment		(112,027	)		(287,634	)
Net cash provided by (used in) investing activities		16,973			(287,634	)
Cash flows from financing activities:
Issuance of notes receivable, net of repayments		(355,660	)
Proceeds from sale of Senior Convertible Notes		5,157,160
Proceeds from tale of Series A Preferred Stock, net of costs and fees		2,969,350			2,772,260
Proceeds from stock subscription payable		102,064
Proceeds from common stock warrant exercises		413,204
Proceeds from sale of Series B preferred stock, net of costs and fees		-			1,282,912
Repayment of capital leases		(101,303	)
Net proceeds (repayments) from notes payable		(830,610	)		464,105
Due to factor		(483,590	)		496,388
Net cash provided by financing activities		6,870,615			5,015,665
Net increase (decrease) in cash and cash equivalents		1,779,930			6,146
Cash and cash equivalents at beginning of year		344,099			337,953
Cash and cash equivalents at end of year	$	2,124,029		$	344,099

See accompanying notes to the consolidated financial statements

F-8

MARKET CENTRAL, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED AUGUST 31, 2005 AND 2004

(continued)
Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for interest	$	248,670		$	156,390
Cash paid during the period for income taxes		-			-
Common stock issued in exchange for services rendered		390,276			190,752
Stock options and warrants issued in exchange for services rendered		483,913			1,033,518
Preferred stock issued in exchange for notes payable		1,051,218			-
Accrued preferred stock dividend		427,401			61,067
Accounts receivable net against notes payable to related parties		428,735			-
Beneficial conversion feature on convertible notes		3,419,797			-
Value of warrants attached to convertible notes		2,482,088			-
Disposal of US Convergion, Inc.: (Note B)
Sylvia common stock received				$	500
Assets disposed of					(68,211	)
Debts assumed by Sylvia					2,967,081
Net gain on disposal of segment					(2,784,370	)
Disposition costs		-			115.000
Disposal of ecommerce support centers, inc.: (Note B)
Cash received	$	130,000			-
Note received		971,000
Assets disposed of		(1,511,977	)		-
Debts assumed by CustornerLinx and Lion Development		1,746,762			-
Net gain on disposal of segment		(1,235,785	)		-
Disposition costs	$	100,000			-

See accompanying notes to the consolidated financial statements

 

F-9

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES

A summary of the significant accounting policies applied in the preparation of the accompanying financial statements follows.

Business and Basis of Presentation

Market Central, Inc. (the "Company") is a software and intellectual property enterprise with products which provide a platform to build a suite of software for Enterprise Content Management (ECM) needs. The Company holds multiple patents and patent-pending technologies and have developed the suite of products that provides solutions for managing the significant quantities of electronic information available today. The Company’s software includes next generation ECM capabilities. ECM includes; intelligent search for the internet and each enterprise, classification and intelligent document recognition.

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Convey Systems International, Inc. (“CSI”), Tigo Search, Inc., ecommerce support centers, inc. (“ecom”) and U.S. Convergion, Inc. ("Convergion"). All significant inter-company transactions and balances have been eliminated in consolidation. The Company sold its ecom and Convergion subsidiaries in August 2005 and May 2004, respectively. The ecom and Convergion business segments are accounted for as discontinued operations, and accordingly, amounts in the financial statements, and related notes for all periods shown have been restated to reflect discontinued operations accounting. Summarized results of the discontinued businesses and information relating to the sale of these subsidiaries are further described in Note B.

Revenue Recognition

The Company recognizes revenues from contracts in which the Company provides only consulting services as the services are performed. The contractual terms of the agreements dictate the recognition of revenue by the Company. Payments received in advance are deferred until the service is provided.

Contract costs include all direct equipment, material, and labor costs and those indirect costs related to contract performance, such as indirect labor. Selling, general and administrative costs are charged to expense as incurred. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in contract performance, contract conditions, and estimated profitability that may result in revisions to costs and income are recognized in the period in which the revisions are determined.

For revenue from product sales, the Company recognizes revenue in accordance with Staff Accounting Bulletin No. 104, REVENUE RECOGNITION ("SAB104"), which superceded Staff Accounting Bulletin No. 101, REVENUE RECOGNITION IN FINANCIAL

STATEMENTS ("SAB101").

SAB 101 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectibility is reasonably assured. Determination of criteria (3) and (4) are based on management's judgments regarding the fixed nature of the selling prices of the products delivered and the collectibility of those amounts. Provisions for discounts and rebates to customers,

F-10

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES (Continued)

estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company defers any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

SAB 104 incorporates Emerging Issues Task Force 00-21 ("EITF 00-21"), MULTIPLE-DELIVERABLE REVENUE ARRANGEMENTS. This issue addresses determination of whether an arrangement involving more than one deliverable contains more than one unit of accounting and how the arrangement consideration should be measured and allocated to the separate units of accounting. EITF 00-21 became effective for revenue arrangements entered into in periods beginning after June 15, 2003. For revenue arrangements occurring on or after August 1, 2003, the Company revised its revenue recognition policy to comply with the provisions of EITF 00-21.

For those contracts which contain multiple deliverables, management must first determine whether each service, or deliverable, meets the separation criteria of EITF 00-21. In general, a deliverable (or a group of deliverables) meets the separation criteria if the deliverable has standalone value to the customer and if there is objective and reliable evidence of the fair value of the remaining deliverables in the arrangement. Each deliverable that meets the separation criteria is considered a “separate unit of accounting.” Management allocates the total arrangement consideration to each separate unit of accounting based on the relative fair value of each separate unit of accounting. The amount of arrangement consideration that is allocated to a unit of accounting that has already been delivered is limited to the amount that is not contingent upon the delivery of another separate unit of accounting. After the arrangement consideration has been allocated to each separate unit of accounting, management applies the appropriate revenue recognition method for each separate unit of accounting as described previously based on the nature of the arrangement. All deliverables that do not meet the separation criteria of EITF 00-21 are combined into one unit of accounting, and the appropriate revenue recognition method is applied.

Advertising

The Company follows the policy of charging the costs of advertising to expenses incurred. The Company incurred no advertising costs during the years ended August 31, 2005 and 2004.

Research and Development

The Company accounts for research and development costs in accordance with the Financial Accounting Standards Board’s Statement of Financial Accounting Standards No. 2 (“SFAS 2”), “Accounting for Research and Development Costs. Under SFAS 2, all research and development costs must be charged to expense as incurred. Accordingly, internal research and development costs are expensed as incurred. Third-party research and developments costs are expensed when the contracted work has been performed or as milestone results have been achieved. Company-sponsored research and development costs related to both present and future products are expensed in the period incurred. The Company incurred no research and product development costs for the years ended August 31, 2005 and 2004.

F-11

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES (Continued)

Income Taxes

Income taxes are provided based on the liability method for financial reporting purposes in accordance with the provisions of Statements of Financial Standards No. 109, "Accounting for Income Taxes". Under this method deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be removed or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date.

Cash Equivalents

For purposes of the Statements of Cash Flows, the Company considers all highly liquid debt instruments purchased with a maturity date of three months or less to be cash equivalents.

Property and Equipment

Property and equipment are stated at cost and depreciated over their estimated useful lives of 24 to 60 months using the straight-line method (Note D).

Long-lived Assets

The Company has adopted Statement of Financial Accounting Standards No. 144 (SFAS 144). The Statement requires that long-lived assets and certain identifiable intangibles held and used by the Company be reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Events relating to recoverability may include significant unfavorable changes in business conditions, recurring losses, or a forecasted inability to achieve break-even operating results over an extended period. The Company evaluates the recoverability of long-lived assets based upon forecasted undercounted cash flows. Should an impairment in value be indicated, the carrying value of intangible assets will be adjusted, based on estimates of future discounted cash flows resulting from the use and ultimate disposition of the asset. SFAS No. 144 also requires assets to be disposed of be reported at the lower of the carrying amount or the fair value less costs to sell.

Capitalized Computer Hardware and Software

The Company has adopted SOP 98-1, "Accounting for the Costs of Computer Software Developed or Obtained for Internal Use." The Company capitalizes software purchased from third parties if the related software product under development has reached technological feasibility or if there are alternative future uses for the purchased software provided that capitalized amounts will be realized over a period not exceeding five years.

F-12

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES (Continued)

In addition, the company capitalizes costs of materials, consultants, interest, and payroll and payroll-related costs for employees incurred in developing internal-use computer software once technological feasibility is attained. Costs incurred prior to the establishment of technological feasibility are charged to general and administrative expense.

Concentrations of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and related party receivables. The Company places its cash and temporary cash investments with credit quality institutions. At times, such investments may be in excess of the FDIC insurance limit. The Company periodically reviews its trade receivables in determining its allowance for doubtful accounts. There was no allowance for doubtful accounts at August 31, 2005 and 2004.

Stock Based Compensation

In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based Compensation-Transition and Disclosure-an amendment of SFAS 123." This statement amends SFAS No. 123, "Accounting for Stock-Based Compensation," to provide alternative methods of transition for a voluntary change to the fair value based method of accounting for stock-based employee compensation. In addition, this statement amends the disclosure requirements of SFAS No. 123 to require prominent disclosures in both annual and interim financial statements about the method of accounting for stock-based employee compensation and the effect of the method used on reported results. The Company has chosen to continue to account for stock-based compensation using the intrinsic value method prescribed in APB Opinion No. 25 and related interpretations. Accordingly, compensation expense for stock options is measured as the excess, if any, of the fair market value of the Company's stock at the date of the grant over the exercise price of the related option.

The Company has adopted the annual disclosure provisions of SFAS No. 148 in its financial reports for the year ended August 31, 2005 and 2004 and will adopt the interim disclosure provisions for its financial reports for the subsequent periods. Had compensation costs for the Company’s stock options been determined based on the fair value at the grant dates for the awards, the Company’s net loss and losses per share would have been as follows (transactions involving stock options issued to employees and Black-Scholes model assumptions are presented in Note L):

	2005			2004
Net loss - as reported	$	(11,189,992	)	$	(7,683,167	)
Add: Total stock based employee compensation expense as reported under intrinsic value method (APB. No. 25)		-			-
Deduct: Total stock based employee compensation expense as reported under fair value based method (SFAS No. 123)		(2,170,548	)		(752,517	)
Net loss - Pro forma	$	(13,360,540	)	$	(8,435,684	)
Net loss attributable to common stockholders - Pro forma	$	(13,787,941	)	$	(9,371,751	)
Basic (and assuming dilution) loss per share - as reported	$	(0.90	)	$	(0.65	)
Basic (and assuming dilution) loss per share - Pro forma	$	(1.07	)	$	(0.70	)

F-13

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES (Continued)

Liquidity

As shown in the accompanying financial statements, the Company incurred a net loss of $11,228,841 and $3,635,850 from continuing operations during the year ended August 31, 2005 and 2004, respectively. The Company's current assets exceeded its current liabilities by $47,840 as of August 31, 2005.

Net Earnings (Loss) Per Share

The Company computes earnings per share under Financial Accounting Standard No. 128, "Earnings Per Share" (SFAS 128). Net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and dilutive common stock equivalents outstanding during the year. Dilutive common stock equivalents consist of shares issuable upon conversion of convertible preferred shares and the exercise of the Company's stock options and warrants (calculated using the treasury stock method). During the years ended August 31, 2005 and 2004, common stock equivalents are not considered in the calculation of the weighted average number of common shares outstanding because they would be anti-dilutive, thereby decreasing the net loss per common share.

Reclassifications

Certain reclassifications have been made in prior years' financial statements to conform to classifications used in the current year.

Comprehensive Income

Statement of Financial Accounting Standards No. 130 (“SFAS 130”), “Reporting Comprehensive Income,” establishes standards for reporting and displaying of comprehensive income, its components and accumulated balances. Comprehensive income is defined to include all changes in equity except those resulting from investments by owners and distributions to owners. Among other disclosures, SFAS 130 requires that all items that are required to be recognized under current accounting standards as components of comprehensive income be reported in a financial statement that is displayed with the same prominence as other financial statements. The Company does not have any items of comprehensive income in any of the periods presented.

Segment Information

The Company adopted Statement of Financial Accounting Standards No. 131, Disclosures about Segments of an Enterprise and Related Information ("SFAS 131"). SFAS establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information for those segments to be presented in interim financial reports issued to stockholders. SFAS 131 also establishes standards for related disclosures about products and services and geographic areas. Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker, or decision making group, in making decisions how to allocate resources and assess performance. The information disclosed herein, materially represents all of the financial information related to the Company's principal operating segments.

F-14

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES (Continued)

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly actual results could differ from those estimates.

New Accounting Pronouncements

In November 2004, the Financial Accounting Standards Board (FASB) issued SFAS 151, Inventory Costs— an amendment of ARB No. 43, Chapter 4. This Statement amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). Paragraph 5 of ARB 43, Chapter 4, previously stated that “. . . under some circumstances, items such as idle facility expense excessive spoilage, double freight, and rehandling costs may be so abnormal as to require treatment as current period charges. . . .” This Statement requires that those items be recognized as current-period charges regardless of whether they meet the criterion of “so abnormal.” In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities. This Statement is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. Management does not believe the adoption of this Statement will have any immediate material impact on the Company.

In December 2004, the FASB issued SFAS No.152, “Accounting for Real Estate Time-Sharing Transactions—an amendment of FASB Statements No. 66 and 67” (“SFAS 152) The amendments made by Statement 152 This Statement amends FASB Statement No. 66, Accounting for Sales of Real Estate, to reference the financial accounting and reporting guidance for real estate time-sharing transactions that is provided in AICPA Statement of Position (SOP) 04-2, Accounting for Real Estate Time-Sharing Transactions. This Statement also amends FASB Statement No. 67, Accounting for Costs and Initial Rental Operations of Real Estate Projects, to state that the guidance for (a) incidental operations and (b) costs incurred to sell real estate projects does not apply to real estate time-sharing transactions. The accounting for those operations and costs is subject to the guidance in SOP 04-2. This Statement is effective for financial statements for fiscal years beginning after June 15, 2005. with earlier application encouraged. The Company does not anticipate that the implementation of this standard will have a material impact on its financial position, results of operations or cash flows.

On December 16, 2004, the Financial Accounting Standards Board (“FASB”) published Statement of Financial Accounting Standards No. 123 (Revised 2004), Share-Based Payment (“SFAS 123R”). SFAS 123R requires that compensation cost related to share-based payment transactions be recognized in the financial statements. Share-based payment transactions within the scope of SFAS 123R include stock options, restricted stock plans, performance-based awards, stock appreciation rights, and employee share purchase plans. The provisions of SFAS 123R are effective as of the first interim period that begins after June 15, 2005. Accordingly, the Company will implement the revised standard in the first quarter of fiscal year 2006. Currently, the Company accounts for its share-based payment transactions under the provisions of APB 25, which does not necessarily require the recognition of compensation cost in the financial statements. Management is assessing the implications of this revised standard, which may materially impact the Company’s results of operations in the first quarter of fiscal year 2006 and thereafter.

F-15

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE A - SUMMARY OF ACCOUNTING POLICIES (Continued)

On December 16, 2004, FASB issued Statement of Financial Accounting Standards No. 153, Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29, Accounting for Nonmonetary Transactions (“ SFAS 153”). This statement amends APB Opinion 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance. Under SFAS 153, if a nonmonetary exchange of similar productive assets meets a commercial-substance criterion and fair value is determinable, the transaction must be accounted for at fair value resulting in recognition of any gain or loss. SFAS 153 is effective for nonmonetary transactions in fiscal periods that begin after June 15, 2005. The Company does not anticipate that the implementation of this standard will have a material impact on its financial position, results of operations or cash flows.

In March 2005, the FASB issued FASB Interpretation (FIN) No. 47, “Accounting for Conditional Asset Retirement Obligations, an interpretation of FASB Statement No. 143,” which requires an entity to recognize a liability for the fair value of a conditional asset retirement obligation when incurred if the liability’s fair value can be reasonably estimated. The Company is required to adopt the provisions of FIN 47 no later than the second quarter of its fiscal 2006. The Company does not expect the adoption of this Interpretation to have a material impact on its consolidated financial position, results of operations or cash flows.

In May 2005 the FASB issued Statement of Financial Accounting Standards (SFAS) No. 154, “Accounting Changes and Error Corrections, a replacement of APB Opinion No. 20 and FASB Statement No. 3.” SFAS 154 requires retrospective application to prior periods’ financial statements for changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. SFAS 154 also requires that retrospective application of a change in accounting principle be limited to the direct effects of the change. Indirect effects of a change in accounting principle, such as a change in non-discretionary profit-sharing payments resulting from an accounting change, should be recognized in the period of the accounting change. SFAS 154 also requires that a change in depreciation, amortization, or depletion method for long-lived, non-financial assets be accounted for as a change in accounting estimate effected by a change in accounting principle. SFAS 154 is effective for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005. Early adoption is permitted for accounting changes and corrections of errors made in fiscal years beginning after the date this Statement is issued. The Company does not expect the adoption of this SFAS to have a material impact on its consolidated financial position, results of operations or cash flows.

NOTE B - DIVESTITURES AND DISCONTINUED OPERATIONS

U.S. Convergion, Inc.

In May 2004, the Company sold Convergion to Sylvia Holding Co., Inc. ("Sylvia") through a Stock Purchase Agreement (“Purchase Agreement”). Pursuant to the Purchase Agreement, Sylvia acquired certain assets and assumed certain liabilities of Convergion and agreed to issue to the Company a total of 500,000 shares of its common stock valued at $0.001 per share. As a result of the sale of the Convergion business segment, the Company accounted for the segment as a discontinued operation, and accordingly, the amounts in the financial statements and related notes for the year ended August 31, 2004 have been restated to reflect discontinued operations accounting.

F-16

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE B - DIVESTITURES AND DISCONTINUED OPERATIONS (Continued)

The following summarizes the disposition of the Convergion business segment:

Sylvia common stock	$	500
Debts assumed by Sylvia		2,967,081
Net assets disposed of		(68,211	)
Disposition costs		(115,000	)
Net gain on disposal of Convergion	$	2,784,370

The Company has adopted Statement of Financial Accounting Standards No. 142 "Goodwill and Other Intangible Assets" (SFAS No. 142) effective August 1, 2002. SFAS No. 142 addresses how intangible assets that are acquired individually or with a group of other assets should be accounted for in financial statements upon their acquisition. This statement requires goodwill amortization to cease and for goodwill to be periodically reviewed for impairment.

In February 2004, the Company completed a test for goodwill in connection with acquisition of Convergion, and the result indicated that the recorded book value of this reporting unit exceeded its fair value, as determined by discounted cash flows. The decrease in fair value is a result of:

o Significant operating losses since the date of acquisition

o Unanticipated decline in revenues and profitability

o Loss of key personnel

As a result of these events and circumstances, Company management believes that more likely than not the fair value of the reporting unit's goodwill has been reduced below its carrying value. As a result, management performed an evaluation of the reporting unit's tangible and intangible assets for purposes of determining the implied fair value of goodwill. Upon completion of the assessment, the Company recorded a non-cash impairment charge of $4,062,003, net of tax, or $0.31 per share in February 2004 to reduce the carrying value of goodwill in this reporting unit to its estimated value of

$0. This charge, as well as all other financial results relating to Convergion, has been reflected in the loss from discontinued operations for fiscal 2004.

F-17

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE B - DIVESTITURES AND DISCONTINUED OPERATIONS (Continued)

U.S. Convergion, Inc.

The financial statements reflect the operating results and balance sheet items of the discontinued operations separately from continuing operations. Prior years have been restated. Operating results for the Convergion discontinued operations for the year ended August 31, 2004 were:

	2004
Revenues	$	2,249,354
Costs and Expenses		(3,390,884	)
Impairment of goodwill		(4,062,003	)
Net loss before tax		(5,203,533	)
Income tax provision (benefit)		-
Net loss		(5,203,533	)
Net gain on sale of Convergion, before tax		2,784,370
Income tax provision (benefit)		-
Gain on sale, net of tax		2,784,370
Loss on discontinued operations , net of tax	$	(2,419,163	)

In connection with the Stock Purchase Agreement, the Company issued to Sylvia a promissory note (“Note”) in the amount of $500,000 to serve as security for the obligations of the Company under the Stock Purchase Agreement. The Note shall only become due and payable upon the demand of Sylvia upon an event of default of the Stock Purchase Agreement. Additionally, the Company entered into a Security Agreement with Sylvia. Pursuant to the Security Agreement, the Company granted Sylvia a security interest in any and all existing or after acquired assets of the Company, up to $3,000,000, securing the Company’s obligations to Sylvia under the Note (collectively the “Escrow Document”). The Note and the Security Agreement matured and expired in fiscal 2005. Additionally, the Company management believes that more likely than not the fair value of the Sylvia common stock has been reduced below its carrying value at August 31, 2004. As a result, the Company recorded a non-cash impairment charge of $500 to reduce the carrying value of Sylvia common stock to its estimated value of $0.

ecommerce support centers, inc.

On May 23, 2005, the Company sold substantially all the assets that comprise its call center operations. The assets sold were included in the Company's ecom subsidiary and the sale provided for a sale price of $1,100,000 and the assumption of certain liabilities, which approximated $85,000. The purchase price was payable $129,000 at closing and a $971,000 5% note due $25,000 per month including interest until the balance is paid. The financial statements reflect the operating results and balance sheet items of the discontinued operations separately from continuing operations. Prior years have been restated.

F-18

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE B - DIVESTITURES AND DISCONTINUED OPERATIONS (Continued)

The following summarizes the gain on the disposition of the assets of the call center business segment on May 23, 20005:

CustomerLinx promissory note	$	971,000
Cash received		129,000
Debts assumed by CustomerLinx		85,234
Net assets disposed of		(563,319	)
Disposition costs		(70,000	)
Net gain on disposal of segment	$	551,915

On August 31, 2005, the Company entered into an agreement to sell all of the outstanding capital stock of ecommerce support centers, inc. (“ecom”) to Lion Development Group II, Inc. The purchase price for the assets was the sum of $1,000, and the assumption of all liabilities of ecom. Additionally, the Company and the Purchaser agreed that on or before one year from the date of the closing, they would in good faith complete a reconciliation of claims against ecom and the payment of such claims in order to compute the deferred portion of the purchase price. Such deferred purchase amount is 70% of the amount by which the cash received from a note owned by ecom and the remaining balance of such note exceeds liabilities paid or agreed to be paid from the proceeds of the note. Such amount is due to the Company either in the form of cash or assignment of a portion of such note. At closing, the note had a principal balance of $929,004 and is payable over a remaining term of 40 months together with simple interest at an annual rate of five percent (5%), and is secured by certain assets of the obligor.

The following summarizes the gain on the disposition of the call center business segment on August 31, 2005:

Cash	$	1,000
Debts assumed by Lion Development Group II, Inc.		1,661,528
Net assets disposed of		(948,658	)
Disposition costs		(30,000	)
Net gain on disposal of segment	$	683,870

The financial statements reflect the operating results and balance sheet items of the discontinued operations separately from continuing operations. Prior years have been restated. Operating results for the ecommerce support centers, inc. discontinued operations for the year ended August 31, 2005 and 2004 were:

F-19

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE B - DIVESTITURES AND DISCONTINUED OPERATIONS (Continued)

	2005			2004
Revenues	$	3,977,112		$	7,707,742
Costs and Expenses		5,174,048			(9,335,896	)
Net loss before tax		(1,196,936	)		(1,628,154	)
Income tax provision (benefit)		-			-
Net loss		(1,196,936	)		(1,628,154	)
Net gain on sale of ecom, before tax		1,235,785
Income tax provision (benefit)		-
Gain on sale, net of tax		1,235,785
Gain on discontinued operations, net of tax	$	38,849

The year ended August 31, 2005 included costs related to U.S. Convergion, Inc. of $186,700 which have been included in loss from discontinued operations.

Net assets and liabilities from discontinued operations at August 31, 2004 consists of:

Assets	August 31, 2004
Property and Equipment	$	4,029,160
Patents and Trademarks		25,101
Accumulated depreciation and amortization		(3,183,434	)
	$	870,827
Liabilities
Accounts payable and accrued liabilities	$	885,234
Capital lease obligations		713,200
	$	1,598,434

NOTE C - RESTRICTED CASH

In June 2004, the Onslow County Tax Office, North Carolina requested to garnish the Company’s bank balance in the amount of $109,617 for outstanding property taxes owed by the Company’s wholly-owned subsidiary, ecom. The Company has included the amount of taxes due in its accrued liabilities at August 31, 2004 and accounted restricted cash in the amount of $109,617. The taxes were paid fiscal 2005 and restrictions on cash were removed.

NOTE D - PROPERTY AND EQUIPMENT

Major classes of property and equipment at August 31, 2005 and 2004 consist of the following:

	2005			2004
Furniture and Fixtures	$	69,526		$	42,273
Computer Equipment and Software		185,985			101,211
		255,511			143,484
Less: Accumulated Depreciation		(120,349	)		(97,761	)
Net Property and Equipment	$	135,162		$	45,723

F-20

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE D - PROPERTY AND EQUIPMENT (Continued)

Total depreciation expense charged to operations for the year ended August 31, 2005 and 2004 are $22,588 and $9,906, respectively.

NOTE E - PATENTS AND TRADEMARKS

The Company has adopted SFAS No. 142, Goodwill and Other Intangible Assets, whereby the Company periodically tests its intangible assets for impairment. On an annual basis, and when there is reason to suspect that their values have been diminished or impaired, these assets will be tested for impairment, and write-downs to be included in results from operations may be necessary.

The costs and accumulated amortization of patents and trademarks at August 31, 2005 and 2004 are summarized as follows:

	2005			2004
Patents and trademarks	$	97,218		$	97,218
Less: accumulated amortization		(64,880	)		(32,440	)
Intangible assets, net	$	32,338		$	64,778

Total amortization expense charged to operations for the year ended August 31, 2005 and 2004 was $32,440 in each year.

Estimated amortization expense as of August 31, 2005 is as follows:

Fiscal Year 2006	$	32,338
Total	$	32,338

NOTE F - NOTES RECEIVABLE - RELATED PARTIES

At August 31, 2005, the Company has a note receivable from one its largest shareholders with a balance of $378,003. This note, which had an original balance of $400,000, matures on May 31, 2006 and is secured by approximately 1,100,000 shares of the Company’s common stock. The note does not provide for interest except that the Company received 159,630 shares of its common stock as an inducement to make this loan. These shares were valued at $239,445 and this amount is being amortized over the one year life of the note. At August 31, 2005, unearned income includes $181,101of unamortized value of these shares, other income includes $58,344 related to this share value. This note originated in conjunction with the return of shares by this shareholder discussed in Notes K and M.

F-21

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE G - NOTES PAYABLE

Notes Payable at August 31, 2005 and 2004 are as follows:

	2005			2004
Note payable to a related party in monthly installments of $20,429 plus interest at LIBOR monthly floating rate plus 2.75%; unsecured maturity date is May 2008	$	1,039,069
Note payable in monthly installments of $33,333 including interest at 6% per annum; maturity date is in March 2005; collateralized by 500,000 shares held by a major stockholder and personal guarantees by two stockholders. The Company was in default under the terms of the note agreement at August 31, 2004. The note was settled and paid in full during the year ended August 31, 2005. The Company accounted for $235,661 as other income in connection with the settlement of the note.				$	501,134
Note payable in monthly installments of $1,919 including interest at 7.34% per annum; unsecured; maturity date is in May 2005.					18,975
Note payable in monthly installments of $2,813 including interest at 6% per annum; unsecured; maturity date is in February 2005.					19,180
Note payable to Bank in monthly installments of interest only at LIBOR daily floating rate plus 3.5%; original maturity date was in July 2004, the Company has requested and the bank has agreed to extend the maturity date every 30 days; current maturity date is in January 2005; personally guaranteed by Company shareholders. This note was assumed by one of the Company's shareholders during the year ended August 31, 2005. (Note M)					1,250,000
Note payable on demand to a related party, interest payable at 6% per annum on repayment date; unsecured. (Note K and M)					237,569
Note payable on demand to a related party, interest payable at 6% per annum on repayment date; unsecured. (Note K and M)					852,905
Note payable on demand to a related party, non-interest bearing; unsecured; maturity date is in May 2004; the Company shall repay the note with Company common stock. The Company is currently in default under the terms of the note agreement. (Note M)		120,000			120,000
Note payable; liabilities assumed pursuant to Assets Purchase Agreement with Pliant, interest payable at 12% per annum, interest due and principal due in March 2004; unsecured. The Company was in default under the terms of the note agreements at August 31, 2004. The note and all unpaid accrued interest was paid in full during the year ended August 31, 2005.					41,133
		1,159,069			3,040,896
Less: current portion		(365,148	)		(3,040,896	)
	$	793,921		$	-

Aggregate maturities of long-term debt as of August 31, 2005 are as follows:

2006	$	365,148
2007		245,148
2008		548,773
2009		-
2010		-
Total	$	1,159,069

F-22

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE H - ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities at August 31, 2005 and 2004 are as follows:

	2005		2004
Accounts payable	$	1,533,596	$	2,323,439
Accrued interest		-0-		2,462
Accrued payroll, payroll expenses and taxes		450,214		816,561
Other accrued expenses in connection with litigation (Note Q)		140,000		300,000
Total	$	2,123,810	$	3,442,462

NOTE I - SENIOR CONVERTIBLE NOTES PAYABLE

The Company began offering a 6.4% convertible note (“Convertible Note”) in April 2005 with an aggregate face value of $6,250,000 and a maturity of May 2007. Subsequent to April 2005, the Company authorized offering up to $7,187,500 aggregate face value of the notes. The Convertible Note was offered with a 20% discount, resulting in net proceeds before commissions of $5,000,000 to the Company of the initial offering amount and up to $5,750,000 if fully subscribed. The Convertible Note was initially offered only to holders of the Company’s Series A Preferred Stock. Included with the Convertible Notes were warrants to purchase one share of the Company’s common stock for each $2 of face value of Convertible Notes sold at an exercise price of $1.00 per share and a term which expires in June 2010. The Convertible Notes provide for conversion of the face amount of the notes into the Company’s common stock at $1.3325 per share and they provide for interest to be paid quarterly. The repayment of the Convertible Notes is secured by a first priority security interest in the Company’s intellectual property granted pursuant to a security agreement to be entered into by the Company. Upon the payment or conversion of $5,000,000 of the total Principal Amount of the Notes, the XML patents owned by Scientigo will be released from such security interest.

As of August 31, 2005, the Company sold Convertible Notes with a face value of $6,446,450 and received net proceeds of $5,157,160. In connection with issuance of the Convertible Notes, the Company issued warrants to its placement agent in exchange for services and commissions. The exercise prices of these warrants were below the fair market value of the Company's common stock. The Company has charged an aggregate of $640,364 to operations during 2005 in connection with the warrants issued to its placement agent (Note L). Additionally, the Company accounted for and charged to operations $1,289,290 of interest expense during the year ended August 31, 2005 in connection with the original 20% discount on the Convertible Notes sold through August 31, 2005 (see Note Q and R).

F-23

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE I - SENIOR CONVERTIBLE NOTES PAYABLE (Continued)

A summary of convertible notes payable at August 31, 2005 and August 31, 2004 is as follows:

	August 31, 2005			August 31, 2004
Convertible notes payable; 6.4% per annum; payable quarterly due May 2007; noteholders have the option to convert unpaid note principal into the Company’s common stock at $1.3325 per share. The noteholders are secured by a first priority security interest in the Company’s intellectual property	$	6,446,450			-
Debt Discount - beneficial conversion feature, net of accumulated amortization of $471,439 and $0 at August 31, 2005 and 2004, respectively.		(2,948,358	)		-
Debt Discount - value attributable to warrants attached to notes, net of accumulated amortization of $338,766 and $0 at August 31, 2005 and 2004, respectively.		(2,143,322	)		-
Total	$	1,354,770			-
Less: current portion		-			-
	$	1,354,770			-

In accordance with Emerging Issues Task Force Issue 98-5, Accounting for Convertible Securities with a Beneficial Conversion Features or Contingently Adjustable Conversion Ratios (“EITF 98-5”), the Company recognized an imbedded beneficial conversion feature present in the Convertible Note. The Company allocated a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital. The Company recognized and measured an aggregate of $3,419,797 of the proceeds, which is equal to the intrinsic value of the imbedded beneficial conversion feature, to additional paid-in capital and a discount against the Convertible Note. The debt discount attributed to the beneficial conversion feature is amortized over the Convertible Note’s maturity period (22 to 25 months) as interest expense.

In accordance with Emerging Issues Task Force Issue 00-27, Application of Issue No. 98-5 to Certain Convertible Instruments (“EITF - 0027”), the Company recognized the value attributable to the warrants in the amount of $2,482,088 to additional paid-in capital and a discount against the Convertible Note. The Company valued the warrants in accordance with EITF 00-27 using the Black-Scholes pricing model and the following assumptions: contractual terms of 5 years, an average risk free interest rate of 2.03%, a dividend yield of 0%, and volatility of 102%. The debt discount attributed to the value of the warrants issued is amortized over the Convertible Note’s maturity period (22 to 25 months) as interest expense.

The Company amortized the Convertible Note debt discount attributed to the beneficial conversion feature and the value of the attached warrants and recorded non-cash interest expense of $810,205 and $0 for the year ended August 31, 2005 and 2004, respectively.

F-24

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE I - SENIOR CONVERTIBLE NOTES PAYABLE (Continued)

Aggregate maturities of senior convertible notes as of August 31, 2005 are as follows:

2006	$	-
2007		6,446,450
Total	$	6,446,450

NOTE J - DUE TO FACTOR

At August 31, 2005, the Company’s arrangement with its factor had been terminated in conjunction with the sale of the stock of the ecommerce support centers, inc. subsidiary (Note B). At August 31, 2004, the factoring arrangement provided for a $2,000,000 factoring facility whereby the factor purchases eligible receivables and advances 80% of the purchased amount to the Company. Purchased receivables are bought at 96.25% of their face amount. The Company receives a rebate of 2.40% for invoices paid by customers between one to thirty days, and 2.36% for invoices paid by customers after thirty days reduced by .04% per additional day such invoice remains outstanding. The arrangement is accounted for as a sale of receivables on which the factor has recourse to the 20% residual of aggregate receivables purchased and outstanding. Net charge to the Company is 1.35% of the invoices paid by customers between one to thirty days, and 1.39% after thirty days, increased by .04% per additional day such invoice remains outstanding. In connection with this agreement, the Company is required to maintain certain financial covenants. As of August 31, 2004, the Company is in default under the factor agreement.

At August 31, 2005 and 2004, balance due from factor (included in accounts receivable) was as follows:

	2005		2004
Accounts Receivable - Factored	$	-	$	604,488
Less: Advance from Factor		-		(483,590	)
Net Due from Factor	$	-	$	120,898

NOTE K - CAPITAL STOCK

The Company is authorized to issue 75,000,000 shares of common stock with $.001 par value per share and 10,000,000 shares of preferred stock with $.001 par value per share. As of August 31, 2005 and 2004, the Company had 13,320,992 and 13,391,693 shares of common stock issued and outstanding, respectively.

In December 2003, the Company's Board of Directors designated 2,251,407 shares of Series A Convertible Preferred Stock, par value $.001 per share (the "Series A Preferred Stock") and 350,000 shares of Series B Convertible Preferred Stock, par value $.001 per share (the "Series B Preferred Stock "). Both Series A Preferred Stock and Series B Preferred Stock have a liquidation preference which is senior to the Company's Common Stock.

In December 2003, the Company approved a private placement offering of up to $3,000,000 of its authorized Series A Preferred Stock at $1.3325 per share. The Series A Preferred Stock is convertible into one share of the Company's common stock after a one-year period from the date of issuance.

F-25

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE K - CAPITAL STOCK (Continued)

The Series A Preferred Stock provides for a 4% annual cumulative dividend, that is payable when declared by the Company's Board of Directors and is payable in shares of the Series A Preferred Stock. During fiscal 2005, the Company approved a private placement offering of up to an additional $4,750,000 of its authorized Series A Preferred Stock at $1.3325 per share. The Company had issued during fiscal 2004 and 2005 an aggregate of 2,251,407 and 2,516,270 shares of Series A Preferred Stock, in change for net proceeds of $2,772,260 and $2,969,350, respectively. The Company also issued an aggregate of 788,906 shares of Series A Preferred Stock to two significant shareholders in exchange for notes payable in the amount of $1,051,217 (Note M). In August 2005, pursuant to an exchange offer, the Company converted all of the Series A Preferred Stock and accrued unpaid dividends into Common Stock. This conversion resulted in the issuance of 5,923,335 shares of the Company’s common stock in exchange for 5,556,583 shares of Series A Preferred Stock previously issued and 366,752 shares of common stock issued as payment for dividends related to the Series A Preferred stock in the amount of $488,468. The issuance of common stock settled in full the cumulative preferred stock dividends of $427,401 and $61,067 accrued during the year ended August 31, 2005 and 2004, respectively.

During the year ended August 31, 2004 the Company issued an aggregate of 350,000 shares of Series B Preferred Stock and received a total proceeds of $1,282,912, net of costs and fees of $367,339. The Series B Preferred Stock is convertible into common stock at the lesser of $1.75 per share or 80% of the lowest bid price for the common stock in the 10 business days preceding the conversion but it cannot be less than 50% of the $1.75 or $.875. This results in the conversion of a maximum of 4,000,000 shares and a minimum of 2,000,000 shares of the Company's common stock. The Series B Preferred Stock holders also have an option to acquire additional common shares in an amount to permit the conversion rights plus this option to result in a total of 4,000,000 shares of the Company's common stock.

In accordance with Emerging Issues Task Force Issue 98-5, Accounting for Convertible Securities with a Beneficial Conversion Features or Contingently Adjustable Conversion Ratios ("EITF 98-5"), the Company recognized an imbedded beneficial conversion feature present in the Series B Convertible Preferred Stock. The Company recognized and measured an aggregate of $875,000, which equals to the intrinsic value of the imbedded beneficial conversion feature, to additional paid-in capital and a return to the Series B Preferred Stock holders. Since the preferred shares were convertible at the date of issuance, the return to the preferred shareholders attributed to the beneficial conversion feature has been recognized in full at the date the Series B Preferred Stock was issued.

The 2,000,000 shares of common stock held by the Escrow Agent pending any conversion of the Series B Convertible remain with the escrow agent. The shares were coded so as not be considered issued until the Series B Preferred Stock shareholders exercise the conversion right. As of August 31, 2005, none of the Series B Preferred Stock shareholders exercised the conversion right.

In November 2004, the Company’s two significant shareholders agreed to return 5,880,740 common shares to the Company’s treasury. In addition, these individuals cancelled a warrant that they owned which provided them with the right to purchase approximately 2,300,000 shares of common stock in the Company, they resigned from the Company’s Board of Directors and they converted a net of $1,051,217 in demand notes due them, net of accounts receivable due the Company into the Series A Preferred Stock. This transaction was completed in May 2005 when one of these shareholders returned an additional 159,630, valued at $239,445 (Note F), shares as inducement for the Company to make a $400,000 loan to him which would facilitate the return of his portion of the 5,880,740 shares. As of August 31, 2005, the 5,880,740 shares of common stock were returned and canceled by the Company.

F-26

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE K - CAPITAL STOCK (Continued)

In March and May 2004, the Company issued an aggregate of 67,500 shares of its common stock to a consultant in exchange for stock options exercised at $0.01 per share. The Company received $68 of proceeds. The Company valued the stock options at the fair value of its common shares at the date the options were granted. Compensation costs of $91,800 were charged to operations during the year ended August 31, 2004 (Note L).

In August 2004, the Company authorized to issue an aggregate of 55,224 shares of its common stock to four Board of Director members in exchange for compensation expenses totaling $98,884. The shares were valued at $1.79 per share, which approximated the fair value of the shares issued during the period the services were rendered. Additionally, in connection with the Settlement Agreement and Mutual Release the Company entered into in August 2004 with the Company's former CEO and Board of Directors member ("Former CEO"), the Company accounted the 800,000 shares of the Company's common stock to be returned from Former CEO as common stock receivable and $356,334 of net cost in connection with the Settlement as a reduction in additional paid-in capital at August 31, 2005 (Note M). The Company received and canceled the 800,000 returned shares during fiscal year 2005.

During the year ended August 31, 2005, the Company issued an aggregate of 149,064 shares of common stock to employees, directors and consultants in exchange for services rendered. These shares were valued at approximately $1.20 to $1.85 per share, which approximated the fair value of the shares issued during the period the services were rendered. Compensation costs of $201,216 were charged to discontinued operations during the year ended August 31, 2005.

The Company also issued an aggregate of 235,970 shares of its common stock to consultants during the year ended August 31, 2005 upon the exercise of stock options at $0.01 per share. The Company received $2,059 of proceeds, net of costs and fees. The Company valued the stock options at the fair value of its common shares at the date the options were granted and compensation costs of $189,060 were charged to operations in prior period at the time the options were granted.

Common stock totaling 461,300 shares were issued in August 2005 in conjunction with the exercise of warrants ranging in price from $.85 to $1.00. The Company received proceeds of $413,204 related to these warrants. As of August 31, 2005, the Company had received $102,064 of warrant proceeds for which common shares had not yet been issued, this amount is included in stock subscription payable at year end and the shares purchased with these warrant exercises were issued subsequent to year end.

NOTE L - STOCK OPTIONS AND WARRANTS

Options

The following table summarizes the changes in options outstanding and the related prices for the shares of the Company’s common stock issued to employees, consultants and shareholders at August 31, 2005, after giving effect to 1:10 reverse split in common stock in February 2003:

	Options Outstanding						Options Exercisable
Exercise Price	Number Outstanding		Weighted Average Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$ .01- $3.16		5,801,424		4.60	$	2.03		1,897,259	$	1.66

Transactions involving the Company’s options issuance are summarized as follows:

	Number of shares			Weighted Average Exercise Price
Outstanding at August 31, 2003		302,210		$	5.22
Granted		844,092			1.30
Exercised		(67,500	)		.01
Cancelled		(12,875	)		17.06
Outstanding at August 31, 2004		1,065,927			2.06
Granted		5,400,802			2.03
Exercised (Note K)		(235,970	)		.01
Cancelled		(429,335	)		2.88
Outstanding at August 31, 2005		5,801,424		$	2.03

F-27

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE L - STOCK OPTIONS AND WARRANTS (Continued)

Warrants

The following table summarizes the changes in warrants outstanding and the related prices for the shares of the Company’s common stock issued to employees, consultants and shareholders at August 31, 2005 after giving effect to 1:10 reverse split in common stock in February 2003.

	Warrants Outstanding						Warrants Exercisable
Exercise Prices:	Number Outstanding		Weighted Average Contractual Life (Years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$ .85 - $7.81		12,082,809		2.94	$	1.15		12,082,809	$	1.15
$11.06 - $11.88		73,486		0.08	$	11.45		73,486	$	11.45
$12.81 - $15.00		16,350		0.36	$	14.83		16,350	$	14.83
		12,172,645		3.09	$	1.29		12,172,645	$	1.29

Transactions involving the Company’s warrants issuance are summarized as follows:

	Number of shares			Weighted Average Exercise Price
Outstanding at August 31, 2003		4,135,176		$	3.43
Granted		692,452			2.12
Exercised		-			-
Cancelled		(80,631	)		16.89
Outstanding at August 31, 2004		4,746,997		$	3.12
Granted		10,568,118			1.23
Exercised		(461,300	)		0.89
Cancelled		(2,681,170	)		0.45
Outstanding at August 31, 2005		12,172,645		$	1.29

The weighted-average fair value of stock options and warrants granted to employees, consultants and shareholders during the years ended August 31, 2005 and 2004 and the weighted-average significant assumptions used to determine those fair values, using a Black-Scholes option pricing model are as follows:

	2005			2004
Significant assumptions (weighted-average):
Risk-free interest rate at grant date		1.78 - 4.76	%		1.06	%
Expected stock price volatility		155 - 227	%		90	%
Expected dividend payout		-			-
Expected option life-years (a)		1.8 - 11.0			3.0 to 4.0

(a)The expected option/warrant life is based on contractual expiration dates.

F-28

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE K - STOCK OPTIONS AND WARRANTS (Continued)

Warrants (Continued)

During the year ended August 31, 2004, the Company charged to operations compensation expenses in connection with granting stock options and warrants to consultants a total of $323,739. Additionally, included in the total numbers of stock options outstanding at August 31, 2004 were 193,377 stock options the Company granted to consultants in exchange for accrued service fees and services rendered, exercisable at $0.01 per share. The Company valued those options at the fair market value of its common stock at the date the options were granted. The options granted settled $64,349 of accrued service fees, and additional compensation expenses of $261,851 were charged to operations during the year ended August 31, 2004. As of August 31, 2004, the Company received $68 of proceeds or 67,500 stock options exercised at $0.01 per share, the Company valued those options at the fair market value of its common stock at the date the options were granted and $91,800 of compensation expense was charged to operations during the year ended August 31, 2004 (Note K). The Company also granted warrants to the consultant in exchange for one year of financing services. Financing costs of $383,579 was capitalized and amortized over twelve-month period. During the year ended August 31, 2005 and 2004, the Company charged to operations $63,931 and $319,648 of amortized financing costs.

During the year ended August 31, 2005, the Company issued an aggregate of 235,970 shares of common stock to employees and consultants in exchange for stock options exercised at $0.01 per share. The Company received $2,059 of proceeds, net of costs and fees. The Company valued those options at the fair market value of its common stock at the date the options were granted. Compensation costs of $189,060 were charged to operations during the year ended August 31, 2005 in connection with this transaction. The Company also issued options and warrants to suppliers, consultants and the placement agent which resulted in an aggregate charge of $483,913 to continuing and discontinued operations during fiscal 2005.

During the year ended August 31, 2005, the Company granted an aggregate of 3,223,225 warrants in connection with issuance of Convertible Notes, the Company recognized the value attributable to the warrants in the amount of $2,482,088 to additional paid-in capital and a discount against the Convertible Note (Note 1). The Company also issued an aggregate of 5,923,335 warrants, exercisable at $.85 per share, in connection with its Series A exchange offer (Note K). The market value per share of the Company's common stock exceeded the exercise price of these warrants at the time of the warrants were granted. The Company has accounted for and charged to operations an aggregate of $4,145,521 in connection with these in-the-money warrants during the year ended August 31, 2005.

F-29

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE L - STOCK OPTIONS AND WARRANTS (Continued)

If the Company recognized compensation cost for the non-qualified employee stock option plan in accordance with SFAS No. 123, the Company’s pro forma net loss attributable to common stockholders and net loss per share would have been $(13,787,941) and $(1.07), respectively for the year ended August 31, 2005 and $(9,371,751) and $(0.70), respectively for the year ended August 31, 2004.

NOTE M - RELATED PARTY TRANSACTIONS

Accounts receivable and other receivable-related parties at August 31, 2005 of $81,090 are payments made on behalf of The Tag Group, Inc. in anticipation of the purchase of substantially all of their assets. These payments to various vendors will be deducted from the purchase price paid to The Tag Group, Inc. at closing of the purchase transaction. At August 31, 2004, the balance of $277,119 is comprised of amounts due to the Company from J&C Nationwide, Inc. and Cheapseats, Inc., entities controlled by the Company's significant shareholder.

During the years ended August 31, 2005 and 2004, the Company provided services through its ecom subsidiary to three companies owned by former directors and/or officers of the Company. All of the revenue from these services are now included in the loss from discontinued operations. The amount of revenue included in this loss from discontinued operations is $-0- and $1,162,691 from Gibraltar Publishing, Inc., for the years ended August 31, 2005 and 2004, respectively. J&C Nationwide, Inc. and Cheapseats, Inc. revenues of $151,616 and $613,774 were also included in this loss from discontinued operations for the years ended August 31, 2005 and 2004, respectively.

The Company’s two largest shareholders agreed to return 5,880,740 common shares to the Company’s treasury in November 2004. In addition, these individuals cancelled a warrant that they owned which provided them with the right to purchase approximately 2,300,000 shares of common stock in the Company, they resigned from the Company’s Board of Directors and they converted a net of $1,051,218 in demand notes due them net of accounts receivable ($428,735) due the Company into the Series A Preferred Stock (Note K). This November 2004 transaction also resulted in one of these shareholders assuming $1,250,000 the Company’s bank debt that was secured by substantially all the assets of the Company (Note G). In exchange for this note assumption, the Company issued a $1,250,000 unsecured note to the shareholder which has a balance of $1,039,069 (Note G). This note assumption transaction also provided for the Company to make a $400,000 loan to the shareholder which has a one year term and is secured by approximately 1,100,000 shares of the Company’s common stock (Note F).

Jones Byrd & Attkisson, Inc. (“JBA”) has acted as placement agent for the Company’s Series A Preferred Stock and the 6.4% Senior Convertible Notes Payable (See Note Q and R). One of JBA’s principals is a director of the Company. In connection with such offerings, the Placement Agent has received $803,207 in cash commissions and warrants to purchase 1,817,887 shares of our Common Stock at cashless exercise prices ranging from $1.00 to $1.3325. JBA’s CFO is an investor in the Company’s 6.4% Senior Convertible Notes and joined the Company as its Chief Operating Officer in September 2005.

In August 2004, the Company entered into a Settlement Agreement and Mutual Release (“Settlement”) with the Company's former CEO and Board of Directors member (“Former CEO”). Pursuant to the Settlement, Former CEO agreed to sell to the Company 800,000 shares of the Company's common stock owned by him for an aggregate of $1.00 plus other good and valuable consideration. Former CEO and the Company agreed to certain releases of each other and certain

F-30

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE M - RELATED PARTY TRANSACTIONS (Continued)

affiliates, including Gibraltar.

In connection with the Settlement, the Company was legally released from its obligation of $176,146 of unpaid accrued salaries to Former CEO, and $203,770 of accrued expenses due to Gibraltar and other entities controlled by Former CEO. The Company legally released Gibraltar from obligations of $656,297 (net of allowance for doubtful account of $60,000) of trade payable due to the Company, and $80,753 of other expenses Gibraltar and other entities controlled by Former CEO indebted to the Company. The Company received and canceled the 800,000 shares of the Company’s common stock from Former CEO during the year ended August 31, 2005.

During the years ended August 31, 2005 and 2004, one of the Company’s principal shareholders advanced funds in the form of unsecured notes, interest payable at 6% per annum, to the Company for working capital purposes. As of August 31, 2005 and 2004, the amounts due to the shareholders are $-0- and $1,090,474 (Note G). These advances were repaid by conversion to Series A Preferred Stock as described in Note K above. Additionally, a Company principal shareholder advanced funds in the form of an unsecured, non-interest bearing note to the Company for working capital purposes. As of August 31, 2005 and 2004, the amount due to the shareholder is $120,000. The Company shall repay the note with common stock at the rate of 100,000 shares of common stock per $120,000 of advances. The Company is currently in default under the term of the note agreement (Note G)

NOTE N - BUSINESS CONCENTRATION

Revenue from continuing operations is not significant in fiscal 2004 or 2005. All of the revenue in 2004 came from one customer, while revenue in 2005 relates to four customers.

NOTE O - LOSSES PER COMMON SHARE

The following table presents the computation of basic and diluted losses per share:

	2005			2004
Net loss available for common shareholders	$	(11,617,393	)	$	(8,619,234	)
Basic and fully diluted loss per share	$	(0.90	)	$	(0.65	)
Continuing operations	$	(0.90	)	$	(0.34	)
Discontinued operations	$	0.00		$	(0.31	)
Weighted average common shares outstanding		12,884,516			13,293,655

For the years ended August 31, 2005 and 2004, 10,682,677 and 3,477,436 potential shares, respectively were excluded from shares used to calculate diluted earnings per share as their inclusion would reduce net losses per share.

F-31

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE P - INCOME TAXES

The Company has adopted Financial Accounting Standard Number 109 (“SFAS 109”) which requires the recognition of deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statement or tax returns. Under this method, deferred tax liabilities and assets are determined based on the difference between financial statements and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. Temporary differences between taxable income reported for financial reporting purposes and income tax purposes are insignificant.

For income tax reporting purposes, the Company's aggregate unused net operating losses approximate $11,900,000, which expire through 2026. The deferred tax asset related to the carryforward is approximately $4,046,000. The Company has provided a valuation reserve against the full amount of the net operating loss benefit, since in the opinion of management based upon the earnings history of the Company, it is more likely than not that the benefits will be realized. Significant changes in ownership may limit the Company's future use of its existing net operating losses.

Components of deferred tax assets as of August 31, 2005 are as follows:

Non-current:
Net operating loss carryforward	$	4,046,000
Valuation allowance		(4,046,000	)
Net deferred tax asset	$	–

NOTE Q - COMMITMENTS AND CONTINGENCIES

Operating Lease Commitments

The Company leases office space under an operating lease in Charlotte, North Carolina for its corporate use. Commitments for minimum rentals under non-cancelable leases at August 31, 2005 are monthly payments averaging of $6,966 through September 2010. All operating leases in existence in fiscal 2004 have expired or been assigned to others in conjunction with the dispositions discussed in Note B..

Commitments for minimum rentals under non-cancelable leases at August 31, 2005 are as follows:

Year	Amount
2006	$	80,157
2007		80,784
2008		83,232
2009		85,680
2010 and after		95,492
Total	$	425,325

The Company incurred and charged to operations $67,684 and $15,097 in rental expense for the years ended August 31, 2005 and 2004, respectively.

F-32

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE Q - COMMITMENTS AND CONTINGENCIES (Continued)

Capital Lease Commitments

All capital leases were included in the disposed ecom subsidiary discussed in Note B. At August 31, 2004, computer equipment and software includes the following amounts for capitalized leases. The capital leases and lease obligations were reclassified to net assets and net liabilities of discontinued operations in connection with the disposition of ecom during the year ended August 31, 2005. At August 31, 2005, all capital leases and lease obligations were transferred to Customerlinx and Lion Development Group II, Inc. (Note B).

Computer equipment and software	$	1,234,202
Less: accumulated depreciation and amortization		( 985,932	)
	$	248,270

Consulting Agreements

The Company has consulting agreements with outside contractors, certain of whom are also Company stockholders. The Agreements are generally month to month.

Litigation

In September 2004, an order requesting the U.S. Attorney for Eastern District of North Carolina to prosecute an alleged criminal contempt of court by the Company, that occurred in the case of Tweddle Litho Corp. vs. Gilbralter and Scientigo, Inc., or Tweddle Case, was entered by a judge in the U.S. District Court, Eastern District of North Carolina in the United States District Court for the Eastern District of North Carolina. The U.S. Attorney for the Eastern District of North Carolina issued a criminal information against the Company alleging contempt of court by virtue of the Company's violation of a court order entered on May 13, 2004 in the Tweddle Case when the Company sold its wholly-owned subsidiary, Convergion on June 2, 2004 in violation of the provisions of the order of May 13, 2004 enjoining the Company from transferring any of the Company's assets out of the ordinary course of business. In October 2004, the Company and the U.S. Attorney entered into a written plea agreement whereby the Company agreed to pay $50,000 for the alleged criminal contempt of court. The matter was ruled on and accepted in U.S. District Court for the Eastern District of North Carolina in May 2005. The Company was also placed on probation for one year.

F-33

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE Q - COMMITMENTS AND CONTINGENCIES (Continued)

Litigation (Continued)

In April 2004, iGate, Inc. (“iGate”) filed a complaint against Gilbralter Publishing, Inc. (“Gilbralter”) and the Company in the U.S. District of the Eastern District of North Carolina, Southern Division, claiming that the Company was liable to iGate in the amount of approximately $725,000. iGate asserts that Gilbralter owed this sum to iGate and by virtue of an alleged fraudulent conveyance, iGate asserts that a fraudulent conveyance occurred when Gilbralter forgave $5,000,000 in liabilities of a wholly owned subsidiary of the Company which were guaranteed by the Company in exchange for the Company's issuing to Gilbralter shares of its Common Stock and warrants to purchase the Company's Common Stock. In May 2004, default was entered against the Company. In November 2004, the court vacated the default and granted the Company leave to answer to the complaint. The Company filed its answer and asserted affirmative defenses alleging absolute defenses to the claims of iGate. The Company believes it has meritorious defenses to iGate’s claim and intends to vigorously defend itself against the claim. Management believes the ultimate outcome of this matter will not have a material adverse effect on the Company's consolidated financial position or results of operations.

Edward Arthur Bohn vs. Terrence Jude Leifheit; E-Commerce Support Center, Inc.; Gibralter Publishing, Inc; Global Demand Publishing, Inc.; Sky Investments of Jacksonville, Inc.; Jan Kaster and Market Central, Inc.

Edward Bohn filed a Complaint in June to initiate the above-captioned action, and obtained a Temporary Restraining Order on the same day. Subsequently, Edward Bohn modified the Temporary Restraining Order to limit its effort against the Company, to enjoin the Company from issuing its stock to Terrence Jude Leifheit. Subsequently, an Amended Complaint was filed by Edward Bohn to dismiss all counts against the Company and ecom., except for injunctive relief relating to the issuance of the Company’s stock. The Company has no liabilities asserted against either by Plaintiff or any of the Defendants. The Company believes it has meritorious defenses to the complaint and intends to vigorously defend itself against the claim. Management believes the ultimate outcome of this matter will not have a material adverse effect on the Company's consolidated financial position or results of operations.

In May 2005, the Company was notified by a software license monitoring group that it was not in compliance with certain computer software licensing agreements. The Company believes that it has meritorious defenses to the allegations and intends to vigorously defend itself against the claims.

In August 2005, the Company agreed to settle a claim from a consultant who had provided services to the Company during fiscal 2004.  This claim was paid subsequent to year end with $60,000 in cash and the issuance of 60,000 shares of the Company's common stock.  The financial statements for the year ended August 31, 2005 contain a charge to operations of $140,000 relating to this transaction.

F-34

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE Q - COMMITMENTS AND CONTINGENCIES (Continued)

Litigation (Continued)

The Company is subject to other legal proceedings and claims, which arise in the ordinary course of its business. Although occasional adverse decisions or settlements may occur, the Company believes that the final disposition of such matters should not have a material adverse effect on its financial position, results of operations or liquidity.

Securities Law Issue

Subsequent to the date of financial statements the Company determined that the 6.4% Senior Convertible Notes and Warrants that the Company issued to investors (Note I) may not have been exempt from the registration requirements under the Securities Act of 1933 or from the registration or qualification requirements under the securities laws of certain states. Consequently, the issuance of the Notes and Warrants may not have complied with the Securities Act of 1933 and the state securities laws of the states of Alabama, Georgia, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia. The Company may be subject to claims by federal and state regulators for any such violations. In addition, if any purchaser of the Company's Senior Convertible Notes were to prevail in a suit resulting from a violation of federal or applicable state securities laws, the Company could be liable to return the amount paid for such securities with interest thereon, less the amount of any income received thereon, upon tender of such securities, or for damages if the purchaser no longer owns the securities. As of the date of these financial statements, the Company is not aware of any alleged specific violation or the likelihood of any claim. There can be no assurance that litigation asserting such claims will not be initiated, or that the Company would prevail in any such litigation. The Company has elected to conduct a rescission offer to address these potential securities laws compliance issues by allowing the holders of the Notes and Warrants to rescind the purchase of such securities and sell those securities back to the Company if they so desire (see Note R).

The Company is unable to predict the extent of its ultimate liability with respect to any and all future securities matters. The costs and other effects of any future litigation, government investigations, legal and administrative cases and proceedings, settlements, judgments and investigations, claims and changes in this matter could have a material adverse effect on the Company's financial condition and operating results.

F-35

MARKET CENTRAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

AUGUST 31, 2005 AND 2004

NOTE R - SUBSEQUENT EVENTS

Subsequent to the date of financial statements the Company determined that the 6.4% Senior Convertible Notes and Warrants (Note I) that the Company issued to investors may not have been exempt from the registration requirements under the Securities Act of 1933 or from the registration or qualification requirements under the securities laws of certain states. Consequently, the issuance of the Notes and Warrants may not have complied with the Securities Act of 1933 and the state securities laws of the states of Alabama, Georgia, Maryland, Mississippi, New Jersey, North Carolina, Ohio, South Carolina, Utah and Virginia (Note Q). The Company elected to conduct a rescission offer to address these securities laws compliance issues by allowing the holders of the Notes and Warrants to rescind the purchase of such securities and sell those securities back to the Company if they so desire. Generally, if the rescission offer is accepted, the Company will repurchase such Notes and Warrants at the price investors paid, plus interest at the current state statutory rate per year, if any, from the date of purchase through the date of payment pursuant to the rescission offer, less interest previously paid to Note holders. This rescission offer will be accompanied by an exchange offer to Note holders who do not accept the rescission offer pursuant to which such holders will be entitled to receive, at their election, new notes and new warrants with more favorable conversion and exercise terms, respectively. The rescission offer will be available for a thirty-day period which will begin upon the effectiveness of a registration statement which the Company has filed with the SEC with respect to the rescission offer and exchange offer. While the Company's management does not believe a significant number of holders of the convertible debt will accept the rescission offer, there can be no assurances as to the ultimate outcome of the offer. Accordingly, should the rescission offer be accepted by a significant number of note holders, this may have a materially adverse affect on the Company's consolidated financial condition.

F-36

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS AND FINANCIAL DISCLOSURE

None.

107

APPENDIX A

Form of Election

Market Central, Inc.

dba Scientigo, Inc.

6701 Carmel Road

Suite 205

Charlotte, NC 28226

Attn: Clifford A. Clark, Secretary

Dear Mr. Clark:

I have received and read the prospectus of Market Central, Inc. dba Scientigo, Inc. relating to its rescission offer, dated ___________, 2005, pursuant to which Scientigo has offered to repurchase its notes and warrants to purchase shares of its common stock, and shares of its common stock that have been issued upon the prior exercise of such warrants or conversion of notes, that may have been issued in violation of federal or state securities laws, or both. I acknowledge that I have had an opportunity to carefully review the information from Scientigo that I consider important in making my election. I advise Scientigo as follows by placing an “X” in the proper spaces provided below:

Shares of Common Stock

____	1.	I hereby elect to reject the rescission offer and desire to retain the notes and warrants, or if I have already exercised warrants or converted notes, the shares of common stock issued upon the exercise of warrants or conversion of notes.
____	2.	I hereby elect to accept the rescission offer and rescind the sale of __________ principal amount of the notes and warrants to purchase _________ shares of common stock  (fill in principal amount of notes and number of warrants, respectively) and the issuance of ____________ shares of common stock upon the exercise of warrants or conversion of notes, if any, to receive a full refund for all sums paid therefore together with interest at the applicable statutory rate per year.

IF PERSONS DESIRING TO ACCEPT THIS RESCISSION OFFER INTEND TO MAKE USE OF THE MAILS TO RETURN THIS LETTER AND THE STOCK POWER(S), INSURED REGISTERED MAIL, RETURN RECEIPT REQUESTED, IS RECOMMENDED AND SHOULD ALSO PROVIDE THEIR DOCUMENTATION, INCLUDING THIS FORM OF ELECTION,  TO CLIFFORD A. CLARK AT THE ADDRESS ABOVE.

TO THE EXTENT I HAVE ACCEPTED THE OFFER, I AGREE I WILL NOT HAVE ANY FURTHER RIGHT, TITLE OR INTEREST IN THOSE NOTES, WARRANTS OR SHARES OF COMMON STOCK PREVIOUSLY ISSUED UPON THE EXERCISE OF WARRANTS OR CONVERSION OF NOTES AND ANY SUBSEQUENT APPRECIATION IN THE VALUE OF SUCH SECURITIES OR THE RIGHT TO PARTICIPATE IN THE EXCHANGE OFFER DESCRIBED IN THE PROSPECTUS.

108

Dated:
	Signature
	Print Name
	Address of Offeree:

109

MARKET CENTRAL, INC.

STOCK POWER

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto Market Central, Inc., a Delaware corporation, _______________ principal amount of Scientigo’s 2005 6.4% Senior Convertible Notes and Warrants to Purchase __________ shares of the common stock of Market Central, Inc. / ____________ shares of common stock issued upon the exercise of such Warrants and conversion of such Notes (circle the correct selection), and does hereby irrevocably constitute and appoint Clifford A. Clark and Cynthia S. White, and any of them, the undersigned’s Attorney to transfer said securities on the books of said corporation with full power of substitution in the premises.

Dated: _____________, 200_	SELLING HOLDER
	Print Name(s) of Selling Holder(s)
	Authorized Signature
	Title of Authorized Signatory (if applicable) 1
	Authorized Signature (if shares held in more than one name)
	Title of Authorized Signatory (if applicable)
	Address of Selling Holder (Line 1)
	Address of Selling Holder (Line 2)
	Phone
	Fax

¹ Trustees, officers and other fiduciaries or agents should indicate their title or capacity and print their names under their signatures.

110

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. Indemnification Of Directors And Officers

Section 145 of the Delaware General Corporation Law provides that a corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil or criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith an in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. A corporation shall have proper to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not corporation would have the power to indemnify such person against such liability under Section 145 of the Delaware General Corporation Law.

Our Certificate of Incorporation provides for the indemnification of directors, officers, employees and agents of the corporation. The Certificate of Incorporation generally provides that a director of Scientigo will not be personally liable to Scientigo or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to Scientigo or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under the Delaware General Corporation Law, or (iv) for any transaction from which the director derived any improper personal benefit. In addition, Scientigo may indemnify any person who was or is a party or is to any threatened to be made a party to any threatened, pending or complete action, suit or proceeding whether civil, criminal, administrative or investigative, or by or in the right of Scientigo to procure judgment in its favor, by reason of the fact that he is or was a director, officer, employee or agent of Scientigo, or is or was serving at the request of Scientigo as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interest of Scientigo, in accordance with, and to the full extent permitted by statute.

111

Our bylaws provide that Scientigo shall indemnify to the fullest extent permitted by law any person made or threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person, or a person of whom he is the legal representative is or was a director, officer, employee or agent of Scientigo or any predecessor of Scientigo or serves or served any other enterprise as a director, office, employee or agent at the request of Scientigo or any predecessor of Scientigo.

In addition, Scientigo maintains insurance against liability asserted against the directors and officers of the corporation and incurred by such persons in any such capacity or arising out of such person’s status as such director or officer.

ITEM 25. Other Expenses Of Issuance And Distribution

The following table sets forth estimated expenses expected to be incurred in connection with the issuance and distribution of the securities being registered. All expenses will be paid by Scientigo.

Securities and Exchange Commission Registration Fee	$
Federal Taxes and Fees	$
State Taxes and Fees	$
Printing and Engraving Expenses	$
Accounting Fees and Expenses	$
Legal Fees and Expenses	$
Miscellaneous	$
TOTAL	$

112

ITEM 26. Recent Sales of Unregistered Securities

In September 2005, Scientigo completed the sale of $6,663,950 Principal Amount of its 2005 6.4% Senior Convertible Notes and 3,331,975 Warrants to Purchase Common Stock at $1.00 per share. In connection with such issuances, commissions were paid to the Placement Agent in the amount of $270,358 and issuance of 540,716 warrants to purchase Common Stock at $1.00 per share on a net basis.

In April 2005, Scientigo completed the sale of 3,305,598 shares of its Series A Preferred Stock at $1.3325 per share. Commissions were paid to the Placement Agent of $335,349 and the issuance of 980,541 warrants to purchase Common Stock at an exercise prices of $1.00 per share on a net basis.

In June 2004, Scientigo completed the sale of 2,251,407 shares of its Series A Preferred Stock at $1.3325 per share. Commissions were paid to the Placement Agent of $210,000 and the issuance of 321,630 warrants to purchase Common Stock at an exercise price of $1.3325 per share on a net basis.

The shares of Series A Preferred Stock and the Notes and Warrants were issued pursuant to Section 4(2) of the Securities Act, as they were sold only to accredited investors and not more than 35 non-accredited investors.

In August 2005, Scientigo closed the exchange offer of one (1) share of its Common Stock and one (1) warrant to purchase one (1) share of Common Stock at $.85 per share in exchange for each share of outstanding Series A Preferred Stock. All outstanding shares of Scientigo’s Series A Preferred Stock were tendered for exchange and accepted by Scientigo. As a result, Scientigo issued 5,923,335 shares of its Common Stock and 5,923,335 warrants to purchase shares of its Common Stock to such former holders of its Series A Preferred Stock. No cash proceeds were received by Scientigo. The exchange offer was exempt from registration under Section 3(a)(9) of the Securities Act.

On March 25, 2004, Scientigo issued an aggregate of 350,000 shares of its Series B Preferred Stock and received proceeds of $1,282,912, net of placement fees and expenses of $367,339. The shares were issued pursuant to Section 4(2) of the Securities Act, as they were sold to one (1) accredited investor.

113

ITEM 27. Exhibits

The following exhibits are filed as part of this Registration Statement.

Exhibit Number	Description of Exhibit
3.1	Restated Certificate of Incorporation of Market Central, Inc. filed in Delaware on November 2, 2005
3.2	By-Laws of Market Central, Inc.
4.1	Specimen of Common Stock Certificate (previously filed as Exhibit 4.1 to Form 10-SB/A dated December 31, 1997)
4.2	Certificate of Designations for Series A Convertible Preferred Stock Certificate (previously filed as Exhibit 4.2 to Form 10-QSB dated April 15, 2004)
4.3	Certificate of Designations for Series B Convertible Preferred Stock Certificate (previously filed as Exhibit 4.1 to Form 10-QSB dated April 15, 2004)
4.4	Convertible Preferred Stock Purchase Agreement dated March 25, 2004 between Market Central, Inc. and Armadillo Investments, Plc
4.5	Registration Rights Agreement dated March 25, 2004, between Market Central, Inc. and Armadillo Investments, Plc
4.6	Form of 2005 6.4% Senior Convertible Note
4.7	Form of A 8% Senior Convertible Note
4.8	Form of B 8% Senior Convertible Note
4.9	Security Agreement dated as of September 30, 2005, between Market Central, Inc. for the benefit of the secured parties signatory hereto pursuant to powers of attorney granted to CrossHill Georgetown Capital, LP
4.10	Form of Preferred Stock Warrant to Purchase Common Stock
4.11	Form of Warrant to Purchase Common Stock
4.12	Form of A Warrant to Purchase Common Stock
4.13	Form of B Warrant to Purchase Common Stock
4.14	Amendment to Security Agreement dated November 7, 2005, between Market Central, Inc. and CrossHill Georgetown Capital, LP
5.1	Opinion of Greenberg Traurig, LLP regarding legality
10.1	Market Central, Inc. 2003 Amended and Restated Stock Plan (previously filed as Appendix B to Definitive Proxy Statement dated December 19, 2003)
10.2	Settlement Agreement and Mutual Release dated August 20, 2004, between Market Central, Inc. and Terrence J. Leifheit (previously filed as Exhibit 10.18 to Form 8-K dated August 30, 2004)
10.3	Employment Agreement between Market Central, Inc. and Clifford Clark dated September 1, 2004
10.4	Employment Agreement between Market Central, Inc. and Doyal Bryant dated October 8, 2004
10.5	Employment Agreement between Market Central, Inc. and Paul Odom dated January 15, 2005
10.6	Asset Purchase Agreement dated May 23, 2005, between E-Commerce Support Centers, Inc. and Customerlinx of North Carolina, Inc. regarding the sale of substantially all of the assets of E-Commerce (previously filed as Exhibit 10.1 to Form 8-K dated May 23, 2005) .
10.7	Stock Purchase Agreement dated August 31, 2005, between Market Central, Inc. and Lion Development Group II, Inc. with respect to the sale of all of the capital stock of E-Commerce Support Centers, Inc. (previously filed as Exhibit 10.1 to Form 8-K dated August 31, 2005)
14.1	Market Central, Inc. Code of Business Conduct and Ethics
14.2	Market Central, Inc. Code of Ethics for Senior Financial Officers
21.1	Subsidiaries of Market Central, Inc.
23.1	Consent of Greenberg Traurig, LLP (contained in Exhibit 5.1)
23.2	Consent of Russell Bedford Stefanou Mirchandani LLP.
99.1	Letter of Transmittal

114

ITEM 28. Undertakings

The undersigned registrant hereby undertakes:

1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement to:

(i) Include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) Reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; and

(iii) Include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

2. That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

Insofar as indemnification for liabilities arising under the Securities Act of 1933, or the Act, may be permitted to directors, officers, or controlling persons of Scientigo pursuant to the foregoing provisions, or otherwise, the small business issuer has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.

The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

[Remainder of page intentionally left blank]

115

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-4 and authorized this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Charlotte, State of North Carolina, on November 10, 2005.

MARKET CENTRAL, INC. (Registrant)
By:	/s/
	Doyal G. Bryant

POWER OF ATTORNEY

We, the undersigned officers and directors of Market Central, Inc., hereby severally constitute and appoint Cynthia S. White and Clifford A. Clark and each of them (with full power to each of them to act alone), our true and lawful attorneys-in-fact and agents, with full power of substitution, for us and in our stead, in any and all capacities, to sign any and all amendments (including pre-effective and post-effective amendments) to this Registration Statement and all documents relating thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the U.S. Securities and Exchange Commission, granting to said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing necessary or advisable to be done in and about the premises, as full to all intents and purposes as he might or could do in person, hereby ratifying and confirming all the said attorneys-in-fact and agents, or any of them, or their substitute or substitutes may lawfully do or cause to be done by virtue hereof.

In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated:

Name	Title	Date
/s/
Doyal G. Bryant	Chief Executive Officer, President and a Director	November 10, 2005
/s/
Clifford A. Clark	Chief Financial Officer, Secretary and a Director	November 10, 2005
/s/
Stuart J. Yarbrough	Chairman of the Board of Directors and a Director	November 10, 2005
/s/
Ronald L. Attkisson	Director	November 10, 2005
/s/
Hoyt G. Lowder	Director	November 10, 2005

116

EX-3.1

EXHIBIT 3.1

RESTATED CERTIFICATE OF INCORPORATION

OF

MARKET CENTRAL, INC.

Pursuant to Section 245

of the Delaware General Corporation Law

Market Central, Inc. (the “Corporation”), a corporation organized and existing under the General Corporation Law of the State of Delaware (the “DGCL”), hereby certifies as follows:

1.The name of the Corporation is Market Central, Inc. The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on January 11, 1999 under the name “Paladyne Corp.”

2.Pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware, this Restated Certificate of Incorporation (this “Restated Certificate”) restates and integrates but does not further amend the provisions of the Certificate of Incorporation of the Corporation.

3.This Restated Certificate of Incorporation was duly adopted by the written consent of the Board of Directors of the Corporation in accordance with the applicable provisions of Section 245 of the DGCL.

4.The text of the Certificate of Incorporation of the Corporation is hereby restated to read in its entirety as follows:

FIRST: Name. The name of the corporation is Market Central, Inc. (the “Corporation”).

SECOND: Registered Office. The registered office of the Corporation is to be located in the City of Wilmington, County of New Castle, in the State of Delaware. The name of its registered agent is the Corporation Service Company, whose address is 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808.

THIRD: Purpose. The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the DGCL.

FOURTH: Capital Stock.

A. Authorized. The total number of shares of all classes of stock which the Corporation shall have authority to issue is Eighty-five Million (85,000,000), of which Seventy-Five Million (75,000,000) shares shall be common stock, $.001 par value per share (the “Common Stock”), and Ten Million (10,000,000) shares shall be preferred stock, $.001 par value per share (the “Preferred Stock”).

B. Provisions Relating to Preferred Stock. Shares of Preferred Stock may be issued from time to time in series, and the Board of Directors of the Corporation is hereby authorized, subject to the limitations provided by law, to establish and designate one or more series of the Preferred Stock, to fix the number of shares constituting each series, and to fix the designations, powers, preferences and relative, participating, optional or other special rights, and qualifications, limitations or restrictions thereof, of each series and the variations and the relative rights, preferences and limitations as between series, and to increase and to decrease the number of shares constituting each series. The authority of the Board of Directors of the Corporation with respect to each series shall include, but shall not be limited to, the authority to determine the following:

(i)The designation of such series.

(ii)The number of shares initially constituting such series.

(iii)The increase, and the decrease to a number not less than the number of the outstanding shares of such series, of the number of shares constituting such series theretofore fixed.

(iv)The rate or rates, and the conditions upon and the times at which dividends on the shares of such series shall be paid, the preference or relation which such dividends shall bear to the dividends payable on any other class or classes or on any other series of stock of the Corporation, and whether or not such dividends shall be cumulative, and, if such dividends shall be cumulative, the date or dates from and after which they shall accumulate.

(v)Whether or not the shares of such series shall be redeemable, and, if such shares shall be redeemable, the terms and conditions of such redemption, including, but not limited to, the date or dates upon or after which such shares shall be redeemable and the amount per share which shall be payable upon such redemption, which amount may vary under different conditions and at different redemption dates.

(vi)The rights to which the holders of the shares of such series shall be entitled upon the voluntary or involuntary liquidation, dissolution or winding up of, or upon any distribution of the assets of, the Corporation, which rights may be different in the case of a voluntary liquidation, dissolution or winding up than in the case of such an involuntary event.

(vii)Whether or not the shares of such series shall have voting rights, in addition to the voting rights provided by law, and, if such shares shall have such voting rights, the terms and conditions thereof, including, but not limited to, the right of the holders of such shares to vote as a separate class either alone or with the holders of shares of one or more other series of Preferred Stock and the right to have more than one vote per share.

(viii)Whether or not a sinking fund or a purchase fund shall be provided for the redemption or purchase of the shares of such series, and, if such a sinking fund or purchase fund shall be provided, the terms and conditions thereof.

-2-

(ix)Whether or not the share of such series shall be convertible into, or exchangeable for, shares of any other class or classes or any other series of the same or any other class or classes of stock of the corporation, and, if provision be made for conversion or exchange, the terms and conditions of conversion or exchange, including, but not limited to, any provision for the adjustment of the conversion or exchange rate or the conversion or exchange price.

(x)Any other relative rights, preferences and limitations.

C.Provisions Relating to Common Stock.

(i)Dividends. Subject to the preferential dividend rights applicable to shares of the Preferred Stock pursuant to Part D of this Article FOURTH and as determined by the Board of Directors of the Corporation pursuant to the provisions of Part B of this Article FOURTH, the holders of shares of the Common Stock shall be entitled to receive such dividends as may be declared by the Board of Directors of the Corporation.

(ii)Liquidation. Subject to the preferential liquidation rights pursuant to Part D of this Article FOURTH and as determined by the Board of Directors of the Corporation pursuant to the provisions of Part B of this Article FOURTH, in the event of any voluntary or involuntary liquidation, dissolution or winding up of, or any distribution of the assets of, the Corporation, the holders of shares of the Common Stock shall be entitled to receive all of the assets of the Corporation available for distribution to its stockholders ratably in proportion to the number of shares of the Common Stock held by them.

(iii)Voting. Except pursuant to Part D of this Article FOURTH or as determined by the Board of Directors of the Corporation pursuant to the provisions of Part B of this Article FOURTH, the holders of shares of the Common Stock shall be entitled to vote on all matters at all meetings of the stockholders of the Corporation, and shall be entitled to one vote for each share of the Common Stock entitled to vote at such meeting, voting together with the holders of the Preferred Stock who are entitled to vote thereon, and not as a separate class.

D. Designation of Series B Convertible Preferred Stock. The designations, powers, preferences, rights, qualifications, limitations or restrictions relating to the Series B Convertible Preferred Stock shall be as set forth in Exhibit A attached hereto.

FIFTH: Classified Directors.

A. Classification. The total number of directors shall be divided into three classes, designated Class I, Class II and Class III, with each class containing one-third of the total, as near as may be possible. The term of office of directors of one class shall expire at each meeting of stockholders. The initial term of office of directors of Class I shall expire at the annual meeting of stockholders in 2000; that of Class II shall expire at the annual meeting of stockholders in 2001; and that of Class III shall expire at the annual meeting of stockholders in 2002; and in any cases as to each director until his successor shall be elected and shall qualify or until his earlier resignation, removal from office, death or disability. Additional directorships resulting from an increase in the number of directors shall be apportioned among the classes as equally as possible. At each annual meeting of stockholders, the number of directors equal to the number of directors of the class whose term expires at such meeting (or, if less, the number of directors properly nominated and qualified for election) shall be elected to hold office until the third succeeding annual meeting of stockholders after their election. Notwithstanding the foregoing, whenever the holders of any one or more classes or series of Preferred Stock of the Corporation shall have the right, voting separately as a class, to elect a director or directors, the director or directors so elected shall not be classified pursuant to this Article FIFTH, and the term of the director or directors so elected shall expire at the next succeeding annual meeting of stockholders.

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B. Vote to Change. Notwithstanding any other provision of this Certificate of Incorporation or the By-Laws of the Corporation (and in addition to any other vote that may be required by law, the Certificate of Incorporation or the By-Laws of the Corporation), the affirmative vote of the holders of sixty-six and two-thirds (66 2/3%) percent of all classes of stock of the Corporation entitled to vote generally in election of directors, considered for purposes of this Article FIFTH as one class, shall be required to amend, alter, change, repeal or adopt any provision inconsistent with this Article FIFTH.

SIXTH: Incorporator. The name and mailing address of the incorporator is:

Name	Mailing Address
Bruce A. Rich	Thelen Reid & Priest LLP 40 West 57th Street New York, New York 10019

SEVENTH: Compromise. Whenever a compromise or arrangement is proposed between this Corporation and its creditors or any class of them and/or between this Corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Delaware may, on the application in a summary way of this Corporation or of any creditor or stockholder thereof or on the application of any receiver or receivers appointed for this Corporation under the provisions of Section 291 of Title 8 of the Delaware Code or on the application of trustees in dissolution or of any receiver or receivers appointed for this Corporation under the provisions of Section 279 of Title 8 of the Delaware Code, order a meeting of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this Corporation, as the case may be, to be summoned in such manner as the said court directs. If a majority in number representing three-fourths in value of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this Corporation, as the case may be, agree to any compromise or arrangement and to any reorganization of this Corporation as a consequence of such compromise or arrangement, the said compromise or arrangement and the said organization shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors, and/or on all the stockholders or class of stockholders, of this Corporation, as the case may be, and also on this Corporation.

EIGHTH: Board of Directors and By-Laws. All corporate powers shall be exercised by the Board of Directors, except as otherwise provided by statute, by this Certificate of Incorporation, by the By-Laws, or by any agreement among all of the stockholders. The By-Laws may be adopted, amended or repealed by the Board of Directors of the Corporation, except as otherwise provided by law, but any by-law made by the Board of Directors is subject to amendment or repeal by the stockholders of the Corporation.

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NINTH: Limited Liability. A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which the director derived any improper personal benefit. If the DGCL is hereafter amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as so amended.

Any repeal or modification of the foregoing paragraph by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification.

TENTH: Indemnification. The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or complete action, suit or proceeding, whether civil, criminal, administrative or investigative, or by or in the right of the Corporation to procure judgment in its favor, by reason of the fact that he is or was a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, in accordance with and to the full extent permitted by statute. Expenses (including attorneys’ fees) incurred in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding as authorized by the Board of Directors in the specific case upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount unless it shall ultimately be determined that he is entitled to be indemnified by the Corporation as authorized in this Article. The indemnification provided by this Article shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under this Certificate of Incorporation or any agreement or vote of stockholders of disinterested directors or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such person.

[signature page follows]

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IN WITNESS WHEREOF, Market Central, Inc. has caused this Restated Certificate to be duly executed by the undersigned this 1st day of November, 2005.

MARKET CENTRAL, INC.
By:	/s/ Doyal G. Bryant
	Name:   Doyal G. Bryant Title:     CEO and President

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EXHIBIT A

CERTIFICATE OF DESIGNATION,

OF THE RIGHTS AND PREFERENCES

OF

SERIES B CONVERTIBLE PREFERRED STOCK

OF

MARKET CENTRAL, INC.

Market Central, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Company”), hereby certifies that the following resolutions were adopted by the Board of Directors of the Company pursuant to the authority of the Board of Directors as required by Section  151 of the Delaware General Corporation Act (the “DGCL”).

RESOLVED, that pursuant to the authority granted to and vested in the Board of Directors of this Company (the “Board of Directors” or the “Board”) in accordance with the provisions of its Articles of Incorporation and Bylaws, each as amended through the date hereof, the Board of Directors hereby authorizes a series of the Company’s previously authorized Preferred Stock, $.001 par value (the “Preferred Stock”), and hereby states the designation and number of shares, and fixes the relative rights, preferences, privileges, powers and restrictions thereof as follows:

I.  CERTAIN DEFINITIONS

For purposes of this Certificate of Designation, capitalized terms are defined in this Certificate of Designation or shall have the following meanings:

“Change of Control” means the acquisition, directly or indirectly, by any Person of ownership of, or the power to direct the exercise of voting power with respect to, a majority of the issued and outstanding voting shares of the Company.

“Common Stock” means the common stock of the Company, par value $.001 per share.

“Issuance Date” means the date of the Closing under the Convertible Preferred Stock Purchase Agreement with respect to the initial issuance of the Series B Preferred Stock.

“Per Share Market Value”of the Common Stock means on any particular date (a) the last sale price of shares of Common Stock on such date or, if no such sale takes place on such date, the last sale price on the most recent prior date, in each case as officially reported on the principal national securities exchange on which the Common Stock is then listed or admitted to trading, or (b) if the Common Stock is not then listed or admitted to trading on any national securities exchange, the closing bid price per share as reported by Nasdaq, or (c) if the Common Stock is not then listed or admitted to trading on the Nasdaq, the closing bid price per share of the Common Stock on such date as reported on the OTCBB or if there is no such price on such date, then the last bid price on the date nearest preceding such date, or (d) if the Common Stock is not quoted on the OTCBB, the closing bid price for a share of Common Stock on such date in the over-the-counter market as reported by the Pinksheets LLC (or similar organization or agency succeeding to its functions of reporting prices) or if there is no such price on such date, then the last bid price on the date nearest preceding such date, or (e) if the Common Stock is no longer publicly traded, the fair market value of a share of the Common Stock as determined by an Appraiser (as defined in the Certificate of Designation) selected in good faith by the holders of a majority of the Series B Preferred Stock; provided, however, that the Company, after receipt of the determination by such Appraiser, shall have the right to select an additional Appraiser, in which case, the fair market value shall be equal to the average of the determinations by each such Appraiser.

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“Person” means an individual or a corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind.

“Purchase Agreement” means the Convertible Preferred Stock Purchase Agreement dated March 24, 2004, by and between the Company and the purchaser set forth in Schedule 1 thereto (the “Purchaser”).

“Redemption Price”means the Stated Value of any share of Series B Preferred Stock that is subject to redemption.

“Trading Day” means (a) a day on which the Common Stock is quoted on the OTCBB or principal stock exchange on which the Common Stock has been listed, or (b) if the Common Stock is not quoted on the OTCBB or any stock exchange, a day on which the Common Stock is quoted in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. (“NASD”), or (c) if the Common Stock is not quoted on the NASD, a day on which the Common Stock is quoted in the over-the-counter market as reported by the Pinksheets LLC (or any similar organization or agency succeeding its functions of reporting prices).

II.  DESIGNATION AND AMOUNT

The designation of this series, which consists of three hundred fifty thousand (350,000) shares of Preferred Stock, is the Series B Convertible Preferred Stock (the “Series B Preferred Stock”) and the stated value shall be U.S. ten dollars ($10.00) per share (the “Stated Value”).

III.  DIVIDENDS

The holder of the shares of Series B Preferred Stock as they appear on the stock records of the Company (“Holder” or “Holders”) shall not be entitled to receive any dividends.

IV.  CONVERSION

(a)Each outstanding share of Series B Preferred Stock shall be convertible into the number of shares of Common Stock determined by dividing the Stated Value by the Conversion Price as defined below, and subject to the Limitation on Conversion in Section 4.13 of the Purchase Agreement, at the option of the Holder in whole or in part, at any time commencing on or after the Issuance Date; provided that, any conversion under this Section IV(a) shall be for a minimum Stated Value of $10,000.00 of Series B Preferred Stock. The Holder shall effect conversions by sending the form of conversion notice attached hereto as Appendix I (the “Notice of Conversion”) in the manner set forth in Section IV(j). Each Notice of Conversion shall specify the Stated Value of Series B Preferred Stock to be converted. The date on which such conversion is to be effected (the “Conversion Date”) shall be on the date the Notice of Conversion is delivered pursuant to Section IV(j) hereof. Except as provided herein, each Notice of Conversion, once given, shall be irrevocable. If the Holder is converting less than all of the shares represented by a certificate for the Series B Preferred Stock tendered by the Holder in the Notice of Conversion, the Company shall deliver to the Holder a new Series B Preferred Stock certificate for such number of shares as has not been converted within five (5) Business Days of the Company’s receipt of the original certificate of Series B Preferred Stock and Notice of Conversion. Upon the entire conversion of the Series B Preferred Stock or the redemption of the Series B Preferred Stock, the certificates for such Series B Preferred Stock shall be returned to the Company for cancellation.

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(b)Not later than ten (10) Business Days after the Conversion Date, the Company will deliver to the Holder (i) a certificate or certificates representing the number of shares of Common Stock being acquired upon the conversion of the Series B Preferred Stock and (ii) once received from the Company, the number of shares of Series B Preferred Stock equal to the number of shares of the Series B Preferred Stock not converted; provided, however, that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon conversion of any Series B Preferred Stock until the Series B Preferred Stock are either delivered for conversion to the Company or any transfer agent for the Series B Preferred Stock or Common Stock, or the Holder notifies the Company that such Series B Preferred Stock certificates have been lost, stolen or destroyed and provides an agreement reasonably acceptable to the Company to indemnify the Company from any loss incurred by it in connection therewith. In the case of a conversion pursuant to a Notice of Conversion, if such certificate or certificates are not delivered by the date required under this Section IV(b), the Holder shall be entitled, by providing written notice to the Company at any time on or before its receipt of such certificate or certificates thereafter, to rescind such conversion, in which event the Company shall immediately return the Series B Preferred Stock tendered for conversion.

(c) Intentionally omitted.

(d)(i)The Conversion Price for each share of Series B Preferred Stock in effect on any Conversion Date shall be the lesser of (a) one dollar and seventy five cents ($1.75) (the “Fixed Conversion Price”) or (b) eighty percent (80%) of the lowest closing bid price for the Common Stock in the ten (10) business days preceding the date of conversion, but in no event less than fifty percent (50%) of the Fixed Conversion Price (the “Floating Conversion Price”). For purposes of determining the closing bid price on any day, reference shall be to the closing bid price for a share of Common Stock on such date on the NASD OTC Bulletin Board, as reported on Bloomberg, L.P. (or similar organization or agency succeeding to its functions of reporting prices).

(ii)If the Company, at any time while any Series B Preferred Stock are outstanding, (a) shall pay a stock dividend or otherwise make a distribution or distributions on shares of its Junior Securities (as defined below) payable in shares of its capital stock (whether payable in shares of its Common Stock or of capital stock of any class), (b) subdivide outstanding shares of Common Stock into a larger number of shares, (c) combine outstanding shares of Common Stock into a smaller number of shares, or (d) issue by reclassification of shares of Common Stock any shares of capital stock of the Company, the Fixed Conversion Price designated in Section IV(d)(i) shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock of the Company outstanding before such event and of which the denominator shall be the number of shares of Common Stock outstanding after such event. Any adjustment made pursuant to this Section IV(d)(ii) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification.

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(iii)If, at any time while any of the Series B Preferred Stock is outstanding, the Company issues or sells shares of Common Stock, or options, warrants or other rights to subscribe for or purchase shares of Common Stock at a price per share that is less than fifty percent (50%) of the Fixed Conversion Price (the “Floor Conversion Price”), then the Floor Conversion Price shall be multiplied by a fraction, the numerator of which shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding on the date of issuance of such shares, options, warrants or rights plus the number of shares which the aggregate offering price of the total number of shares so offered would purchase at such Floor Conversion Price, and the denominator of which shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding on the date of issuance of such options, rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase. There will be no adjustment of the Fixed Conversion Price under this subsection IV(d)(iii) if (A) warrants or options are issued to employees or consultants of the Company for services rendered or to be rendered to the Company or if Common Stock is issued upon the exercise of such warrants or options, or (B) other options, warrants or rights to subscribe for or purchase common stock that, in any case, are issued at an exercise or subscription price that is equal to or greater than the Floor Conversion Price.

(iv)If the Company, at any time while Series B Preferred Stock are outstanding, shall distribute to all holders of Common Stock (and not to Holders of Series B Preferred Stock) evidences of its indebtedness or assets or rights or warrants to subscribe for or purchase any security then in each such case the Conversion Price at which each Series B Preferred Stock shall thereafter be convertible shall be determined by multiplying the Fixed Conversion Price in effect immediately prior to the record date fixed for determination of stockholders entitled to receive such distribution by a fraction of which the denominator shall be the Per Share Market Value of Common Stock determined as of the record date mentioned above, and of which the numerator shall be such Per Share Market Value of the Common Stock on such record date less the then fair market value at such record date of the portion of such assets or evidence of indebtedness so distributed applicable to one outstanding share of Common Stock as determined by the Board of Directors in good faith; provided, however that in the event of a distribution exceeding ten percent (10%) of the net assets of the Company, such fair market value shall be determined by a nationally recognized or major regional investment banking firm or firm of independent certified public accountants of recognized standing (which may be the firm that regularly examines the financial statements of the Company) (an “Appraiser”) selected in good faith by the Holders of a majority of the principal amount of the Series B Preferred Stock then outstanding; and provided, further, that the Company, after receipt of the determination by such Appraiser shall have the right to select an additional Appraiser, in which case the fair market value shall be equal to the average of the determinations by each such Appraiser. In either case the adjustments shall be described in a statement provided to the Holder and all other Holders of Series B Preferred Stock of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share of Common Stock. Such adjustment shall be made whenever any such distribution is made and shall become effective immediately after the record date mentioned above.

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(v)All calculations under this Article IV shall be made to the nearest 1/1000th of a cent or the nearest 1/1000th of a share, as the case may be. Any calculation over .005 shall be rounded up to the next cent or share and any calculation less than .005 shall be rounded down to the previous cent or share.

(vi)In the event the Fixed Conversion Price is not adjusted pursuant to Section IV(d)(ii), (iii), (iv), or (v), within ten (10) Business Days following the occurrence of an event described therein, and is still not adjusted following thirty (30) days notice from the Holder to the Company requesting that such adjustment be made, then the Holder shall have the right to require the Company to redeem all of the Holder’s Series B Preferred Stock at the Stated Value of such Holder’s Series B Preferred Stock, and the Company shall pay such amount to the Holder pursuant to the written instructions provided by the Holder.

(vii)Whenever the Fixed Conversion Price is adjusted pursuant to Section IV(d)(ii), (iii), (iv) or (v), the Company shall within two (2) days after the determination of the new Fixed Conversion Price mail and fax to the Holder and to each other Holder of Series B Preferred Stock, a notice setting forth the Fixed Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment.

(viii)In case of any reclassification of the Common Stock, any consolidation or merger of the Company with or into another person, the sale or transfer of all or substantially all of the assets of the Company or any compulsory share exchange pursuant to which the Common Stock is converted into other securities, cash or property, then each holder of Series B Preferred Stock then outstanding shall have the right thereafter to convert such Series B Preferred Stock only into the shares of stock and other securities and property receivable upon or deemed to be held by holders of Common Stock following such reclassification, consolidation, merger, sale, transfer or share exchange (except in the event the property is cash, then the Holder shall have the right to convert the Series B Preferred Stock and receive cash in the same manner as other stockholders), and the Holder shall be entitled upon such event to receive such amount of securities or property as the shares of the Common Stock into which such Series B Preferred Stock could have been converted immediately prior to such reclassification, consolidation, merger, sale, transfer or share exchange would have been entitled. The terms of any such consolidation, merger, sale, transfer or share exchange shall include such terms so as to continue to give to the holder the right to receive the securities or property set forth in this Section IV(d)(viii) upon any conversion following such consolidation, merger, sale, transfer or share exchange. This provision shall similarly apply to successive reclassifications, consolidations, mergers, sales, transfers or share exchanges. Notwithstanding the foregoing, in the event of any merger, consolidation or change of control of the Company, then as provided in the Purchase Agreement, the Company shall have the right to demand that the Holder convert all Series B Preferred Stock then held by the Purchaser into Common Stock upon the terms and conditions set forth in this Certificate of Designation. If the Holder does not comply with such demand, the Company may redeem all Series B Preferred Stock held by the Purchaser at their Stated Value.

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(ix)If:

(A) the Company shall declare a dividend (or any other distribution) on its Common Stock; or

(B) the Company shall declare a special nonrecurring cash dividend on or a redemption of its Common Stock; or

(C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights; or

(D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock of the Company (other than a subdivision or combination of the outstanding shares of Common Stock), any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property; or

(E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding-up of the affairs of the Company;

then the Company shall cause to be filed at each office or agency maintained for the purpose of conversion of Series B Preferred Stock, and shall cause to be mailed and faxed to the Holders of Series B Preferred Stock at their last addresses as it shall appear upon the Series B Preferred stock register, at least thirty (30) calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined, or (y) the date on which such reclassification, consolidation, merger, sale, transfer, share exchange, dissolution, liquidation or winding-up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities or other property deliverable upon such reclassification, consolidation, merger, sale, transfer, share exchange, dissolution, liquidation or winding-up; provided, however, that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice.

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(e)If at any time conditions shall arise by reason of action or inaction taken by the Company which in the opinion of the Board of Directors are not adequately covered by the other provisions hereof and which might materially and adversely affect the rights of the Holders of Series B Preferred Stock (different than or distinguished from the effect generally on rights of holders of any class of the Company’s capital stock), the Company shall, at least thirty (30) calendar days prior to the effective date of such action, mail and fax a written notice to each Holder of Series B Preferred Stock briefly describing the action contemplated and the material adverse effects of such action on the rights of such Holders and an Appraiser selected by the Holders of majority of the outstanding Series B Preferred Stock shall give its opinion as to the adjustment, if any (not inconsistent with the standards established in this Article IV), of the Fixed Conversion Price (including, if necessary, any adjustment as to the securities into which Series B Preferred Stock may thereafter be convertible) and any distribution which is or would be required to preserve without diluting the rights of the Holders of Series B Preferred Stock; provided, however, that the Company, after receipt of the determination by such Appraiser, shall have the right to select an additional Appraiser, in which case the adjustment shall be equal to the average of the adjustments recommended by each such Appraiser. The Board of Directors shall make the adjustment recommended forthwith upon the receipt of such opinion or opinions or the taking of any such action contemplated, as the case may be; provided, however, that no such adjustment of the Fixed Conversion Price shall be made which in the opinion of the Appraiser(s) giving the aforesaid opinion or opinions would result in an increase of the Fixed Conversion Price.

(f)The Company covenants that it will at all times reserve and keep available out of its authorized and unissued Common Stock solely for the purpose of issuance upon conversion of Series B Preferred Stock as herein provided, free from preemptive rights or any other actual contingent purchase rights of persons other than the Holders of Series B Preferred Stock, such number of shares of Common Stock as shall be issuable (taking into account the adjustments and restrictions of Section IV(d) and Section IV(e) hereof) upon the conversion of all outstanding shares of Series B Preferred Stock. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly and validly authorized, issued and fully paid and nonassessable.

(g) No fractional shares of Common Stock shall be issuable upon a conversion hereunder and the number of shares to be issued shall be rounded up to the nearest whole share. If a fractional share interest arises upon any conversion hereunder, the Company shall eliminate such fractional share interest by issuing the Holder an additional full share of Common Stock.

(h)The issuance of certificates for shares of Common Stock on conversion of Series B Preferred Stock shall be made without charge to the Holder for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificate, provided that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holder and the Company shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

(i)Series B Preferred Stock converted into Common Stock shall be canceled upon conversion.

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(j)Each Notice of Conversion shall be given by facsimile to the Company no later than 4:00 pm New York time. Any such notice shall be deemed given and effective upon the transmission of such facsimile at the facsimile telephone number specified in the Purchase Agreement. In the event that the Company receives the Notice of Conversion after 4:00 p.m. New York time, the Conversion Date shall be deemed to be the next Business Day. In the event that the Company receives the Notice of Conversion after the end of the Business Day, notice will be deemed to have been given the next Business Day.

V.  EVENTS OF DEFAULT AND REMEDIES

(a)“Event of Default”, wherever used herein, means any one of the following events:

(i)the Company shall fail to observe or perform any material covenant, agreement or warranty contained in this Series B Preferred Stock Certificate of Designation, and such failure shall not have been remedied within ten (10) Business Days after the date on which written notice of such failure shall have been given;

(ii)the occurrence of any material breach or event of default by the Company under the Purchase Agreement or any other Transaction Document (as defined in the Purchase Agreement) and such material breach or event of default shall not have been remedied within the applicable cure period provided for therein, but in any event, not less than ten (10) days after the date on which written notice of such failure shall have been given;

(iii)the Company or any of its subsidiaries shall commence a voluntary case under the United States Bankruptcy Code as now or hereafter in effect or any successor thereto (the “Bankruptcy Code”); or an involuntary case is commenced against the Company under the Bankruptcy Code and the Company fails to pursue dismissal of the case within sixty (60) days after commencement of the case; or the Company commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to the Company or there is commenced against the Company any such proceeding and the Company fails to pursue dismissal of the case within sixty (60) days after commencement of the case; or the Company suffers any appointment of any custodian or the like for it or any substantial part of its property and the Company fails to pursue dismissal of the custodian within sixty (60) days after the appointment; or the Company makes a general assignment for the benefit of creditors; or any corporate or other action is taken by the Company for the purpose of effecting any of the foregoing;

(iv)trading in the common stock of the Company shall have been suspended, delisted, or otherwise ceased by the Securities and Exchange Commission or the NASD or other exchange or the Nasdaq (whether the National Market or otherwise), and trading is not reinstated within thirty (30) Trading Days, except for (i) any suspension of trading of limited duration solely to permit dissemination of material information regarding the Company, and trading is reinstated promptly after such dissemination and (ii) any general suspension of trading for all companies trading on such exchange or market or OTCBB; or

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(v)the Company shall issue a press release, or otherwise make publicly known, that it is not honoring properly executed Notice of Conversions for any reason whatsoever.

(b)If any Event of Default occurs and continues, beyond any cure period, if any, then so long as such Event of Default shall then be continuing any Holder may, by notice to the Company, demand redemption of the shares of Series B Preferred Stock held by such Holder at the Redemption Price (as defined herein), and such Holder may immediately and without expiration of any grace period enforce any and all of its rights and remedies hereunder and all other remedies available to it under applicable law. Such declaration may be rescinded and annulled by such Holder at any time prior to payment hereunder. No such rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon. This shall include, but not be limited to the right to temporary, preliminary and permanent injunctive relief without the requirement of posting any bond or undertaking.

(c)Such Holder may thereupon proceed to protect and enforce its rights either by suit in equity, or by action at law, or by other appropriate proceedings whether for the specific performance (to the extent permitted by law) of any covenant or agreement contained in this Series B Preferred Stock Certificate of Designation or in aid of the exercise of any power granted in this Series B Preferred Stock Certificate of Designation, and proceed to enforce the redemption of any of the Series B Preferred Stock held by it, and to enforce any other legal or equitable right of such Holder.

(d)To effectuate the terms and provisions of this Certificate of Designation of Series B Preferred Stock, the Holder may send notice of any default to the Attorney-in-Fact (as defined in the Purchase Agreement) and send a copy of such notice to the Company and its counsel, simultaneously, and request the Attorney-in-Fact, to comply with the terms of this Certificate of Designation of Series B Preferred Stock and the Purchase Agreement and all agreements entered into pursuant to the Purchase Agreement on behalf of the Company.

VI.  REDEMPTION

(a)Except as provided in this section VI (a), neither the holder nor the Company may demand that the Series B Preferred Stock be redeemed. Until all of the Series B Preferred Stock has been converted, in the event that the Company engages in a single transaction or a series of related transactions that cause it to (i) consolidate with or merge with or into any other Person, (ii) permit any other Person to consolidate with or merge into it, or (iii) undergo a Change in Control, then at the option of the Company exercisable by giving thirty (30) days written notice to the Holder, the Company may request that the Holder convert all shares of Series B Preferred Stock then held by the Holder into Common Stock upon the terms and conditions set forth in this Certificate of Designation. If the Holder does not comply with such request, the Company may redeem all Series B Preferred Stock held by the Purchaser at their Stated Value (the “Redemption Price”). The Company is not obligated to provide for redemption of the Series B Preferred Stock through a sinking fund.

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(b)Shares of Series B Preferred Stock which have been redeemed or converted shall be deemed retired pursuant to the DGCL and shall thereafter resume the status of authorized and unissued shares of Preferred Stock, undesignated as to series, and may be redesignated and reissued as part of any new series of Preferred Stock other than Series B Preferred Stock.

(c) No redemption shall be made and no sum set aside for such redemption at any time that the terms or provisions of any indenture or agreement of the Company, including any agreement relating to indebtedness, specifically prohibits such redemption or setting aside or provides that such redemption or setting aside would constitute a breach or default thereunder (after notice or lapse of time or both), except with the written consent of the lender or other parties to said agreement as the case may be.

(f)If any redemption shall at any time be prohibited by the DGCL, the same shall be deferred until such time as the redemption can occur in full compliance with such statute.

(g)In the event the Company shall redeem shares of Series B Preferred Stock as provided herein, notice of such redemption shall be given by first class mail, postage prepaid, or by confirmed facsimile transmission, not less than thirty (30) business days prior to the date fixed by the Board for redemption to each holder of Series B Preferred Stock at the address that appears on the Company’s stock record books; provided, however, that no failure to provide such notice nor any defect therein shall affect the validity of the redemption proceeding except as to the holder to whom the Company has failed to send such notice or whose notice was defective. Each notice shall state (i) the redemption date, (ii) the number of shares of Series B Preferred Stock to be redeemed; (iii) the Redemption Price; and (iv) the place or places where certificates for shares of Series B Preferred Stock are to be surrendered for payment. When notice has been provided as aforesaid then from and after the redemption date (unless default shall be made by the Company in providing money for the payment of the Redemption Price of the shares called for redemption) said shares shall no longer be deemed to be outstanding and all rights of the holders thereof shall cease (other than the right to receive the Redemption Price or common Stock with respect to converted Series B Preferred Stock). Upon surrender of the certificates for Series B Preferred Stock accompanied by appropriate stock powers, the shares shall be redeemed by the Company at the Redemption Price.

VII.  RANK

The Series B Preferred Stock shall, as to redemptions and the distribution of assets upon liquidation, dissolution or winding up of the Company, rank (i) prior to the Company’s Common Stock; (ii) prior to any class or series of capital stock of the Company hereafter created that, by its terms, ranks junior to the Series B Preferred Stock (“Junior Securities”); (iii) junior to any class or series of capital stock of the Company hereafter created (with the consent of the holders of a majority of the outstanding Series B Preferred Stock) which by its terms ranks senior to the Series B Preferred Stock (“Senior Securities”); and (iv) pari passu with any other series of preferred stock of the Company hereafter created (with the consent of the holders of a majority of the outstanding Series B Preferred Stock) which by its terms ranks on a parity (“Pari Passu Securities”) with the Series B Preferred Stock. The Series B Preferred Stock shall rank Pari Passu with the Company’s Series A Preferred Stock upon distribution of assets upon liquidation in the manner provided in Article VIII.

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VIII.  LIQUIDATION PREFERENCE

If the Company shall commence a voluntary case under the U.S. Federal bankruptcy laws or any other applicable bankruptcy, insolvency or similar law, or consent to the entry of an order for relief in an involuntary case under any law or to the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator (or other similar official) of the Company or of any substantial part of its property, or make an assignment for the benefit of its creditors, or admit in writing its inability to pay its debts generally as they become due, or if a decree or order for relief in respect of the Company shall be entered by a court having jurisdiction in the premises in an involuntary case under the U.S. Federal bankruptcy laws or any other applicable bankruptcy, insolvency or similar law resulting in the appointment of a receiver, liquidator, assignee, custodian, trustee, sequestrator (or other similar official) of the Company or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and any such decree or order shall be unstayed and in effect for a period of sixty (60) consecutive days and, on account of any such event, the Company shall liquidate, dissolve or wind up, or if the Company shall otherwise liquidate, dissolve or wind up, including, but not limited to, the sale or transfer of all or substantially all of the Company’s assets in one transaction or in a series of related transactions (a “Liquidation Event”), no distribution shall be made to the holders of any shares of capital stock of the Company (other than Senior Securities and Pari Passu Securities) upon liquidation, dissolution or winding up unless prior thereto the Holders of shares of Series A Preferred Stock andSeries B Preferred Stock shall have received the Liquidation Preference (as defined below) with respect to each share. If, upon the occurrence of a Liquidation Event, the assets and funds available for distribution among the Holders of the Series A Preferred Stock, Series B Preferred Stock and Holders of Pari Passu Securities shall be insufficient to permit the payment to such holders of the preferential amounts payable thereon, then the entire assets and funds of the Company legally available for distribution to the Series A Preferred Stock, Series B Preferred Stock and the Pari Passu Securities shall be distributed ratably among such shares in proportion to the ratio that the Liquidation Preference payable on each such share bears to the aggregate Liquidation Preference payable on all such shares. The purchase or redemption by the Company of stock of any class, in any manner permitted by law, shall not, for the purposes hereof, be regarded as a liquidation, dissolution or winding up of the Company. Neither the consolidation or merger of the Company with or into any other entity nor the sale or transfer by the Company of substantially all of its assets shall, for the purposes hereof, be deemed to be a liquidation, dissolution or winding up of the Company. The “Liquidation Preference” with respect to a share of Series A Preferred Stock means an amount equal to the Series A Liquidation Value thereof as defined in the Certificate of Designation of the Series A Preferred Stock.. The “Liquidation Preference” with respect to a share of Series B Preferred Stock means an amount equal to fifty percent (50%) of the Stated Value thereof, provided, however, that after the holders of the Series A Preferred Stock, the Series B Preferred Stock and Pari Passu Securities have received the Liquidation Preference with respect to their shares, the holders of the Series B Preferred Stock shall receive an additional distribution equal to fifty percent (50%) of the Stated Value of the Series B Preferred Stock before any distribution shall be made to the holders of any other shares of capital stock of the Company. The Liquidation Preference with respect to any Pari Passu Securities shall be as set forth in the Certificate of Designation filed in respect thereof.

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IX.  VOTING RIGHTS

The Holders of the Series B Preferred Stock have no voting power whatsoever, except as provided by the DGCL. To the extent that under the DGCL the vote of the Holders of the Series B Preferred Stock, voting separately as a class or series, as applicable, is required to authorize a given action of the Company, the affirmative vote or consent of the Holders of at least a majority of the then outstanding shares of the Series B Preferred Stock represented at a duly held meeting at which a quorum is present or by written consent of the Holders of at least a majority of the then outstanding shares of Series B Preferred Stock (except as otherwise may be required under the DGCL) shall constitute the approval of such action by the class. To the extent that under the DGCL Holders of the Series B Preferred Stock are entitled to vote on a matter with holders of Common Stock, voting together as one class, each share of Series B Preferred Stock shall be entitled to a number of votes equal to the number of shares of Common Stock into which it is then convertible (subject to the limitations contained in Article IV) using the record date for the taking of such vote of shareholders as the date as of which the Conversion Price is calculated.

X.  MISCELLANEOUS

(a)If any shares of Series B Preferred Stock are converted pursuant to Article IV, the shares so converted shall be canceled, shall return to the status of authorized, but unissued preferred stock of no designated series.

(b)Upon receipt by the Company of (i) evidence of the loss, theft, destruction or mutilation of any Preferred Stock certificate(s) and (ii) (y) in the case of loss, theft or destruction, of indemnity (without any bond or other security) reasonably satisfactory to the Company, or (z) in the case of mutilation, upon surrender and cancellation of the Preferred Stock certificate(s), the Company shall execute and deliver new Preferred Stock certificate(s) of like tenor and date. However, the Company shall not be obligated to reissue such lost or stolen Preferred Stock certificate(s) if the Holder contemporaneously requests the Company to convert such Series B Preferred Stock.

(c)Upon submission of a Notice of Conversion by a Holder of Series B Preferred Stock, (i) the shares covered thereby shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights as a Holder of such converted shares of Series B Preferred Stock shall cease and terminate, excepting only the right to receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Company to comply with the terms of this Certificate of Designation. Notwithstanding the foregoing, if a Holder has not received certificates for all shares of Common Stock prior to the tenth (10^th) business day after the expiration of the Delivery Period with respect to a conversion of Series B Preferred Stock for any reason, then (unless the Holder otherwise elects to retain its status as a holder of Common Stock by so notifying the Company within five (5) business days after the expiration of such ten (10) business day period) the Holder shall regain the rights of a Holder of Series B Preferred Stock with respect to such unconverted shares of Series B Preferred Stock and the Company shall, as soon as practicable, return such unconverted shares to the Holder. In all cases, the Holder shall retain all of its rights and remedies for the Company’s failure to convert Series B Preferred Stock.

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(d)The remedies provided in this Certificate of Designation shall be cumulative and in addition to all other remedies available under this Certificate of Designation, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein shall limit a Holder’s right to pursue actual damages for any failure by the Company to comply with the terms of this Certificate of Designation. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holders of Series B Preferred Stock and that the remedy at law for any such breach may be inadequate. The Company therefore agrees, in the event of any such breach or threatened breach, that the Holders of Series B Preferred Stock shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required.

(e)Whenever the Company is obligated to purchase or redeem a Holder’s Series B Preferred Stock, and the Redemption Price is not paid to the Holder by the tenth (10^th) day after the Redemption Price is due and payable to such Holder, the Company shall thereafter pay interest to such Holder on the unpaid portion of the Redemption Price at the rate of ten percent (10%) per annum, compounded annually, until the Redemption Price is paid in full.

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IN WITNESS WHEREOF, the undersigned, being the President and Secretary of Market Central, Inc., hereby declare under penalty of perjury that the foregoing is a true and correct copy of the Certificate of Designation of the Rights and Preferences of the Series B Convertible Preferred Stock of Market Central, Inc. duly adopted by the Board of Directors of Market Central, Inc. on March 23, 2004, and this Certificate of Designation is executed by the undersigned on behalf of Market Central, Inc. this 25^th day of March, 2005.

MARKET CENTRAL, INC.
By:	/s/ William Goldstein
	William Goldstein, Co-Chairman

By:	/s/ Marc Bercoon
	Marc Bercoon, Assistant Secretary

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APPENDIX I

NOTICE OF CONVERSION

AT THE ELECTION OF THE HOLDER

(To be Executed by the Registered Holder

in order to Convert the Series B Preferred Stock of Market Central, Inc.)

The undersigned hereby irrevocably elects to convert the Series B Preferred Stock into shares of Common Stock, par value $.001 per share (the “Common Stock”), of Market Central, Inc. (the “Company”) according to the provisions of the Certificate of Designation hereof, as of the date written below. If shares are to be issued in the name of a person other than undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith.

Conversion calculations:

Date to Effect Conversion

Number of Shares to be Converted

Applicable Conversion Price

Number of Shares to be Issued Upon Conversion

Signature

Name

Address

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EX-3.2

RESTATED BY-LAWS

OF

MARKET CENTRAL, INC.

ARTICLE I

Stockholders’ Meetings; Voting

Section 1.1 Annual Meeting. The regular annual meeting of the stockholders for the election of directors and the transaction of whatever other business may properly come before the meeting shall be held at the principal office of the Corporation, at 10 o’clock, a.m., on the first Wednesday of February of each year, or at such other date, time and place as the Board of Directors may designate.

Section 1.2. Special Meetings. Special meetings of stockholders may be called at any time by the Chairman of the Board, the President, the Board of Directors, or as provided in Section 2.2, to be held at such date, time and place either within or without the State of Delaware as may be stated in the notice of the meeting. A special meeting of stockholders shall be called by the Secretary upon the written request, stating the purpose of the meeting, of stockholders who together own of record at least twenty-five percent (25%) of the outstanding shares of stock entitled tovote at such meeting.

Section 1.3. Notice of Meetings. Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, date and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise provided by law, the written notice of any meeting shall be given not less than ten nor more than sixty days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the Corporation. The Corporation shall, at the written request of any stockholder, cause such notice to such stockholder to be confirmed to such other address and/or by such other means as such stockholder may reasonably request, provided that if such written request is received after the date any such notice is mailed, such request shall be effective for subsequent notices only.

Section 1.4. Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Section 1.5. Quorum. At each meeting of stockholders, except where otherwise provided by law or the Certificate of Incorporation or these By-Laws, the holders of a majority of the outstanding shares of each class of stock entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum. With respect to any matter on which stockholders vote separately as a class, the holders of a majority of the outstanding shares of such class shall constitute a quorum for a meeting with respect to such matter. Two or more classes or series of stock shall be considered a single class for purposes of determining existence of a quorum for any matter to be acted on if the holders thereof are entitled or required to vote together as a single class at the meeting on such matter. In the absence of a quorum the stockholders so present may, by majority vote, adjourn the meeting from time to time in the manner provided by Section 1.4 of these By-Laws until a quorum shall attend.

Section 1.6. Organization. Meetings of stockholders shall be presided over by the Chairman of the Board, or in his absence by the President, or in his absence by a Vice President, or in the absence of the foregoing persons by a chairman designated by the Board of Directors, or in the absence of such designation by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting.

Section 1.7. Voting; Proxies. Unless otherwise provided in the Certificate of Incorporation, each stockholder entitled to vote at any meeting of stockholders shall be entitled to one vote for each share of stock held by him which has voting power upon the matter in question. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for him by proxy, but no such proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or another duly executed proxy bearing a later date with the Secretary of the Corporation. Voting at meetings of stockholders need not be by written ballot and need not be conducted by inspectors unless the holders of a majority of the outstanding shares of any class of stock entitled to vote thereon present in person or by proxy at such meeting shall so determine. At all meetings of stockholders, all questions shall, unless otherwise provided by law or by the Certificate of Incorporation or these By-Laws, be decided by the vote of the holders of a majority of the outstanding shares of all classes of stock entitled to vote thereon present in person or by proxy at the meeting, voting as a single class.

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Section 1.8. Fixing Date for Determination of Stockholders of Record. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty nor less than ten days before the date of such meeting, nor more than sixty days prior to any other action. If no record date is fixed: (1) the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; (2) the record date for determining stockholders entitled to express consent to corporate action in writing without a meeting, when no prior action by the Board is necessary, shall be the day on which the first written consent is expressed; and (3) the record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board may fix a new record date for the adjourned meeting.

Section 1.9. List of Stockholders Entitled to Vote. The Secretary shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present.

Section 1.10. Consent of Stockholders in Lieu of Meeting. To the extent provided by any statute at the time in force, whenever the vote of stockholders at a meeting thereof is required or permitted to be taken for or in connection with any corporate action, by any statute, by the Certificate of Incorporation or by these By-Laws, the meeting and prior notice thereof and vote of stockholders may be dispensed with if the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted shall consent m writing to such corporate action without a meeting by less than unanimous written consent and notice thereof shall be given to those stockholders who have not consent in writing.

ARTICLE II

Board of Directors

Section 2.1. Powers; Number; Qualifications. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors, except as may be otherwise provided by law or in the Certificate of Incorporation. The number of Directors which shall constitute the whole Board of Directors shall not be less than one (1) nor more than nine (9). Within such limits, the number of directors may be fixed from time to time by vote of the stockholders or of the Board of Directors, at any regular or special meeting, subject to the provisions of the Certificate of Incorporation.

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Section 2.2. Election; Term of Office; Resignation; Removal; Vacancies; Special Elections. Except as otherwise provided in the Certificate of Incorporation or in this Section 2.2, directors shall be elected annually at the annual meeting of the stockholders. Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. Each director (whenever elected) shall hold office for the term specified upon his election and until his successor is elected and qualified or until his earlier resignation or removal as provided in the Certificate of Incorporation. Any director may resign at any time upon written notice to the Board of Directors or to the Chairman of the Board or to the President of the Corporation. Such resignation shall take effect at the time specified therein, and unless otherwise specified therein no acceptance of such resignation shall be necessary to make it effective. Any director may be removed with or without cause at any time upon the affirmative vote of the holders of a majority of the outstanding shares of stock of the Corporation entitled to vote for the election of such director, given at a special meeting of such stockholders called for the purpose, except as may otherwise be provided in the Certificate of Incorporation. If any vacancies shall occur in the Board of Directors, by reason of death, resignation, removal or otherwise, or if the authorized number of directors shall be increased, the directors then in office shall continue to act, and such vacancies may be filled by a majority of the directors then in office, though less than a quorum; provided, however, that whenever the holders of any class or classes of stock or series thereof are entitled to elect one or more directors by the provisions of the Certificate of Incorporation, vacancies and newly created directorships of such class or classes or series shall be filled by a majority of the directors elected by such class or classes or series thereof then in office though less than a quorum or by a sole remaining director so elected. Any such vacancies or newly created directorships may also be filled upon the affirmative vote of the holders of a majority of the outstanding shares of stock of the Corporation entitled to vote for the election of directors, given at a special meeting of the stockholders called for the purpose.

Section 2.3. Regular Meetings. Regular meetings of the Board of Directors may be held at such places within or without the State of Delaware and at such times as the Board may from time to time determine, and if so determined notice thereof need not be given.

Section 2.4. Special Meetings. Special meetings of the Board of Directors may be held at any time or place within or without the State of Delaware whenever called by the Chairman of the Board, by the President or by any two directors. Reasonable notice thereof shall be given by the person or persons calling the meeting.

Section 2.5. Telephonic Meetings Permitted. Unless otherwise restricted by the Certificate of Incorporation or these By-Laws, any member of the Board of Directors, or any committee designated by the Board, may participate in a meeting of the Board or of such committee, as the case may be, by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this by-law shall constitute presence in person at such meeting.

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Section 2.6. Quorum; Vote Required for Action. At all meetings of the Board of Directors the presence of a majority of the total number of directors shall constitute a quorum for the transaction of business. The vote of at least a majority of the directors present at any meeting at which a quorum is present shall be necessary to constitute and shall be the act of the Board unless the Certificate of Incorporation or these By-Laws shall otherwise provide. In case at any meeting of the Board a quorum shall not be present, the members of the Board present may adjourn the meeting from time to time until a quorum shall attend.

Section 2.7. Organization. Meetings of the Board of Directors shall be presided over by the Chairman of the Board, or in his absence by the President, or in their absence by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting.

Section 2.8. Action by Directors Without a Meeting. Unless otherwise restricted by the Certificate of Incorporation or these By-Laws, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board or such committee, as the case may be, consents thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee.

ARTICLE III

Committees

Section 3.1. Committees. The Board of Directors may, by resolution passed by a majority of the total number of directors, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. Any such committee, to the extent provided in the resolution of the Board, and unless otherwise restricted by the Certificate of Incorporation or these By-Laws, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation, to the full extent permitted by law.

Section 3.2. Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board may adopt, amend and repeal rules for the conduct of its business. In the absence of a provision by the Board or a provision in the rules of such committee to the contrary, the entire authorized number of members of such committee shall constitute a quorum for the transaction of business, the vote of all such members present at a meeting shall be the act of such committee, and in other respects each committee shall conduct its business pursuant to Article II of these By-Laws.

ARTICLE IV

Officers

Section 4.1 Chairman of the Board. The Board of Directors may appoint one of its members to be Chairman of the Board to serve at the pleasure of the Board. The duties of the Chairman shall be to preside at all meetings of the Board of Directors or the stockholders and to provide a proposed agenda for all such meetings. The Chairman shall also have and may exercise such further powers and duties as from time to time may be determined by the Board of Directors.

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Section 4.2 President. The Board of Directors shall appoint one of its members to be President of the Corporation. In the absence of the Chairman, the President shall preside at all meetings of the Board or the stockholders. The President shall also have and may exercise such further powers and duties as from time to time may be determined by the Board of Directors.

Section 4.3 Chief Executive Officer. The Board of Directors shall appoint a Chief Executive Officer. The Chief Executive Officer shall have and may exercise all the powers and duties pertaining, by law, regulation or practice, to the position of Chief Executive Officer and shall have and may exercise such further powers and duties as from time to time may be determined by the Board of Directors. Unless the Chairman or another executive officer or group shall have been so designated and empowered by the Board of Directors, the President shall be the Chief Executive Officer of the Corporation.

Section 4.4 Vice Presidents. The Board of Directors may appoint one or more Vice Presidents, with or without designation as Executive Vice President, Senior Vice President or other title differentiation as it deems appropriate. Each Vice President shall have and may exercise any and all powers and duties which may be determined by the Board of Directors or the Chief Executive Officer. One Vice President may be designated by the Board of Directors, in the absence of the President, to perform all the duties of the President.

Section 4.5 Secretary. The Board of Directors shall appoint a Secretary, who shall be Secretary of the Board and of the Corporation, and shall keep accurate records of all proceedings of the Board and of the stockholders. The Secretary shall attend to the giving of all notices required by these By-laws to be given, shall be custodian of the corporate seal, and shall have and may exercise any and all other powers and duties pertaining, by law, regulation or practice, to the office of Secretary. The Secretary shall also have and may exercise such other powers and duties as may be determined by the Board of Directors, the Chairman of the Board or the Chief Executive Officer.

Section 4.6 Chief Financial Officer. The Board of Directors shall appoint a Chief Financial Officer who shall have charge of all funds and securities of the Corporation. The Chief Financial Officer shall have and may exercise any and all other powers and duties pertaining, by law, regulation or practice, to the office of Chief Financial Officer or Treasurer. The Chief Financial Officer shall also have and may exercise such other powers and duties as may be determined by the Board of Directors or the Chief Executive Officer.

Section 4.7 Term of Office; Resignation; Removal; Vacancies. Except as otherwise provided in the resolution of the Board of Directors electing any officer, each officer shall hold office until a successor shall have been duly elected and shall have qualified, or until the expiration of such officer’s term in office if elected or appointed for a specified period of time, or until his or her earlier death, retirement, termination, resignation or removal. Any officer may resign at any time upon written notice to the Board or to the Chief Executive Officer of the Corporation. Such resignation shall take effect at the time specified therein, and unless otherwise specified therein no acceptance of such resignation shall be necessary to make it effective. The Board may remove any officer with or without cause at any time, provided that such action by the Board shall require the vote of a majority of the whole Board. Any such removal shall be without prejudice to the contractual rights of such officer, if any, with the Corporation, but the election of an officer shall not of itself create contractual rights. Any vacancy occurring in any office of the Corporation by death, resignation, removal or otherwise shall or may be filled for the unexpired portion of the term by the Board at any regular or special meeting.

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ARTICLE V

Stock

Section 5.1. Certificates. Every holder of stock in the Corporation shall be entitled to have a certificate signed by or in the name of the Corporation by the Chairman of the Board of Directors, or the President or a Vice President, and by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary, of the Corporation, certifying the number of shares owned by him in the Corporation. If such certificate is manually signed by one officer or manually countersigned by a transfer agent or by a registrar, any other signature on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the date of issue.

Section 5.2. Lost, Stolen or Destroyed Stock Certificates; Issuance of New Certificates. The Corporation may issue a new certificate of stock in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the Corporation may require the owner of the lost, stolen or destroyed certificate, or his legal representative, to give the Corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate.

ARTICLE VI

Miscellaneous

Section 6.1. Seal. The Corporation may have a corporate seal which shall have the name of the Corporation inscribed thereon and shall be in such form as may be approved from time to time by the Board of Directors. The corporate seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.

Section 6.2. Waiver of Notice of Meetings of Stockholders, Directors and Committees. Whenever notice is required to be given by law or under any provision of the Certificate of Incorporation or these By-Laws, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, directors, or members of a committee of directors need be specified in any written waiver of notice unless so required by the Certificate of Incorporation or these By-Laws.

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Section 6.3. Form of Records. Any records maintained by the Corporation in the regular course of its business, including its stock ledger, books of account and minute books, may be kept on, or be in the form of, punch cards, magnetic tape, photographs, microphotographs or any other information storage device, provided that the records so kept can be converted into clearly legible form within a reasonable time. The Corporation shall so convert any records so kept upon the request of any person entitled to inspect the same.

Section 6.4. Dividends. Dividends upon the stock of the Corporation, subject to the provisions of the Certificate of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, bonds, in property, or in shares of stock, subject to the provisions of the Certificate of Incorporation.

Section 6.5. Reserves. Before the payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purposes as the directors shall think conducive to the interest of the Corporation, and the directors may modify or abolish any such reserve.

Section 6.6. Checks. All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

Section 6.7. Fiscal Year. The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

Section 6.8. Offices. The registered office of the Corporation shall be in the City of Wilmington, County of New Castle, State of Delaware. The Corporation may also have offices at such other places within or outside the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.

ARTICLE VII

Amendments

Section 7.1. Amendments. These By-Laws may be altered, amended or repealed at any regular meeting of the stockholders or of the Board of Directors or at any special meeting of the stockholders or of the Board of Directors if notice of such alteration, amendment or repeal be contained in the notice of such special meeting.

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ARTICLE VIII

Indemnification

Section 8.1. Indemnification. The Corporation shall indemnify to the fullest extent permitted by law any person made or threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person, or a person of whom he is the legal representative, is or was a director, officer, employee or agent of the Corporation or any predecessor of the Corporation, or serves or served any other enterprise as a director, officer, employee or agent at the request of the Corporation or any predecessor of the Corporation.

The Corporation shall pay any expenses reasonably incurred by a director or officer in defending a civil or criminal action, suit or proceeding in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Corporation under this Article or otherwise. The Corporation may, by action of its Board of Directors, provide for the payment of such expenses incurred by employees and agents of the Corporation as it deems appropriate.

The rights conferred on any person under this Article shall not be deemed exclusive of any other rights that such person may have or hereafter acquire under any statute, provision of the Corporation’s Certificate of Incorporation, by-law, agreement, vote of stockholders or disinterested directors or otherwise. All rights to indemnification and to the advancement of expenses under this Article shall be deemed to be provided by a contract between the Corporation and the director, officer, employee or agent who serves in such capacity at any time while these By-Laws and any other relevant provisions of the Delaware General Corporation Law and any other applicable law, if any, are in effect. Any repeal or modification thereof shall not affect any rights or obligations then existing.

For purposes of this Article, references to “the Corporation” shall be deemed to include any subsidiary of the Corporation now or hereafter organized under the laws of the State of Delaware.

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EX-4.4

EXHIBIT 4.4

CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT

Between

MARKET CENTRAL, INC.

and

THE PURCHASER(S) LISTED ON SCHEDULE 1 HERETO

March 25, 2004

TABLE OF CONTENTS

Article I CERTAIN DEFINITIONS		1
1.1	Certain Definitions	1
ARTICLE II PURCHASE AND SALE OF CONVERTIBLE PREFERRED SHARES		4
2.1	Purchase and Sale: Purchase Price.	4
2.2	Execution and Delivery of Documents: The Closing.	5
ARTICLE III REPRESENTATIONS AND WARRANTIES		6
3.1	Representations	6
3.2	Representations and Warranties of the Purchaser	10
ARTICLE IV OTHER AGREEMENTS OF THE PARTIES		13
4.1	Manner of Offering	13
4.2	Notice of Certain Events	13
4.3	Blue Sky Laws	13
4.4	Integration	13
4.5	Furnishing of Rule 144(c) Materials	14
4.6	Solicitation Materials	14
4.7	Listing of Common Stock	14
4.8	Attorney-in-Fact	14
4.9	Indemnification	14
4.10	Notice and Consultation Before Securities Issuances	16
4.11	Purchaser’s Ownership of Common Stock	17
4.12	No Violation of Applicable Law	17
4.13	Redemption Restrictions	17
4.14	Option for Additional Company Shares	18
4.15	Lock-Up Agreement	18
4.16	Use of Proceeds	18
ARTICLE V MISCELLANEOUS		18
5.1	Fees and Expenses	18
5.2	Entire Agreement	19
5.3	Notices	19
5.4	Amendments; Waivers	20
5.5	Headings	20
5.6	No Third Party Beneficiaries	20
5.7	Governing Law/Venue/Service of Process	20
5.8	Survival	20
5.9	Counterpart Signatures	20
5.10	Publicity	20
5.11	Severability	21
5.12	Limitation of Remedies	21
5.13	Successors and Assigns	21
5.14	Legal Fees and Interest Default Rate	21

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THIS CONVERTIBLE PREFERRED STOCK PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of March __,2004, between Market Central, Inc., a corporation organized and existing under the laws of the State of Delaware (the “Company”), and the purchaser(s) listed on Schedule 1 hereto (the “Purchaser”).

WHEREAS, subject to the terms and conditions set forth in this Agreement, the Company desires to issue and sell to the Purchaser and the Purchaser desires to acquire from the Company three hundred fifty thousand (350,000) shares of the Company’s Series B Convertible Preferred Stock, $.001 par value per share (the “Series B Preferred Stock”), with a Stated Value of ten dollars ($10) per share, and an aggregate Stated Value of three million five hundred thousand dollars ($3,500,000), for an aggregate purchase price of three million five hundred thousand dollars ($3,5000,000).

IN CONSIDERATION of the mutual covenants contained in this Agreement, the Company and each Purchaser agree as follows:

ARTICLE I

CERTAIN DEFINITIONS

1.1Certain Definitions. As used in this Agreement, and unless the context requires a different meaning, the following terms have the meanings indicated:

“Affiliate” means, with respect to any Person, any Person that, directly or indirectly, controls, is controlled by or is under common control with such Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or by contract or otherwise.

“Agreement” shall have the meaning set forth in the introductory paragraph of this Agreement.

“Armadillo Shares” meansof the Ordinary Shares of Armadillo Investments, Plc.

“Attorney-in-Fact” means Gottbetter & Partners, LLP, 488 Madison Avenue, 12 Floor, New York, NY 10022; Tel: 212-400-6900; Fax: 212-400-6901.

“Business Day” means any day except Saturday, Sunday and pay which shall be a legal holiday or a day on which banking institutions in the State of New York are authorized or required by law or other government actions to close.

“Certificate of Designation” means the Certificate of Designation of the Series B Preferred Stock annexed as Exhibit A hereto.

“Chance of Control” means the acquisition, directly or indirectly, by any Person of ownership of, or the power to direct the exercise of voting power with respect to, a majority of the issued and outstanding voting shares of the Company.

“Closing” shall have the meaning set forth in Section 2.2 a.

“Closing Date” shall have the meaning set forth in Section 2.2 a.

“Common Stock” means shares now or hereafter authorized of the class of common stock, $___ par value, of the Company and stock of any other class into which such shares may hereafter have been reclassified or changed.

“Company” shall have the meaning set forth in the introductory paragraph.

“Control Person” shall have the meaning set forth in Section 4.11 (a) hereof.

“Conversion Date” shall have the meaning set forth in the Certificate of Designation.

“Conversion Price” shall have the meaning set forth in the Certificate of Designation.

“Default” means any event or condition which constitutes an Event of Default or which with the giving of notice or lapse of time or both would, unless cured or waived, become an Event of Default.

“Disclosure Documents” means the Company’s reports filed under the Exchange Act with the SEC.

“Escrow Agent” means Gottbetter & Partners, LLP, 488 Madison Avenue, 12 Floor, New York, NY 10022; Tel: 212-400-6900; Fax: 212-400-6901.

“Escrow Agreement” means the Escrow Agreement in the form of Exhibit M annexed hereto.

“Event of Default” shall have the meaning set forth in Section 5.

“Exchange Act” means the Securities Exchange Act of 1934, as amended. “Execution Date” means the date of this Agreement first written above. “Indemnified Party” shall have the meaning set forth in Section 4.11 b hereof. “Indemnifying Party” shall have the meaning set forth in Section 4.11 b hereof. “G&P” means Gottbetter & Partners, LLP.

“Limitation on Conversion” shall have the meaning set forth in Section 4.11 hereof.

“Losses” shall have the meaning set forth in Section 4.11 a hereof.

“Material” shall mean having a financial consequence in excess of $25,000.

“Material Adverse Effect” shall have the meaning set forth in Section 3.1(a).

“NASD” means the National Association of Securities Dealers, Inc.

“NASDAQ” shall mean the NASDAQ Stock Market, Inc.

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“Original Issue Date” shall have the meaning set forth in the Certificate of Designation. “OTCBB” shall mean the NASD over-the counter Bulletin Board.

“Per Share Market Value” of the Common Stock means on any particular date (a) the last sale price of shares of Common Stock on such date or, if no such sale takes place on such date, the last sale price on the most recent prior date, in each case as officially reported on the principal national securities exchange on which the Common Stock is then listed or admitted to trading, or (b) if the Common Stock is not then listed or admitted to trading on any national securities exchange, the closing bid price per share as reported by Nasdaq, or (c) if the Common Stock is not then listed or admitted to trading on the Nasdaq, the closing bid price per share of the Common Stock on such date as reported on the OTCBB or if there is no such price on such date, then the last bid price on the date nearest preceding such date, or (d) if the Common Stock is not quoted on the OTCBB, the closing bid price for a share of Common Stock on such date in the over-the-counter market as reported by the Pinksheets LLC (or similar organization or agency succeeding to its functions of reporting prices) or if there is no such price on such date, then the last bid price on the date nearest preceding such date, or (e) if the Common Stock is no longer publicly traded, the fair market value of a share of the Common Stock as determined by an Appraiser (as defined in the Certificate of Designation) selected in good faith by the holders of a majority of the Series B Preferred Stock; provided, however, that the Company, after receipt of the determination by such Appraiser, shall have the right to select an additional Appraiser, in which case, the fair market value shall be equal to the average of the determinations by each such Appraiser.

“Person” means an individual or a corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind.

“Power of Attorney” means the power of attorney in the form of Exhibit G annexed hereto.

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an investigation or partial proceeding, such as a deposition), whether commenced or threatened.

“Purchase Price” shall have the meaning set forth in Section 2.1(b).

“Purchaser” shall have the meaning set forth in the introductory paragraph.

“Redemption Price” shall mean an amount equal to the Stated Value of the Shares outstanding that are subject to redemption.

“Registration Rights Agreement” means the Registration Rights Agreement in the form of Exhibit J annexed hereto.

“Reporting Issuer” means a company that is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act.

“Required Approvals” shall have the meaning set forth in Section 3.1(f).

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“Securities” means the Shares, the Underlying Shares and the Option Shares.

“SEC” means the Securities and Exchange Commission.

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

“Series B Preferred Stock” shall have the meaning set forth in the recital.

“Shares” shall have the meaning set forth in Section 2.1(a).

“Stated Value” means the sum of ten dollars ($10) per Share or three million five hundred thousand ($3,500,000) for all of the Shares.

“Subsidiaries” shall have the meaning set forth in Section 3.1(a).

“Trading Day” means (a) a day on which the Common Stock is quoted on Nasdaq, the OTCBB or the principal stock exchange on which the Common Stock has been listed, or (b) if the Common Stock is not quoted on Nasdaq, the OTCBB or any stock exchange, a day on which the Common Stock is quoted in the over-the-counter market, as reported by the Pinksheets LLC (or any similar organization or agency succeeding its functions of reporting prices).

“Transaction Documents” means this Agreement and all exhibits and schedules hereto and all other documents, instruments and writings required pursuant to this Agreement.

“Underlying Shares” means the shares of the Company’s Common Stock into which the Shares are convertible as provided in the Certificate of Designation.

ARTICLE II

PURCHASE AND SALE OF CONVERTIBLE PREFERRED SHARES

2.1Purchase and Sale: Purchase Price.

(a)Subject to the terms and conditions set forth herein, the Company shall issue and sell and the Purchaser shall purchase three hundred fifty thousand (350,000) shares of the Company’s Series B 0 % Convertible Preferred Stock, $.001 par value per share (the “Shares”). The Series B Preferred Stock shall have the respective rights, preferences and privileges as set forth in the Certificate of Designation to be filed by the Company with the Secretary of State of Delaware prior to the Execution Date.

(b)The purchase price for each Share shall be Ten Dollars ($10) (the “Per Share Consideration”). The Per Share Consideration multiplied by the number of Shares to be purchased by the Purchaser is referred to as the “Purchase Price.”

(c)The Purchase Price shall be paid by delivery to the Company of _______________ Ordinary Shares (the “Armadillo Shares”) of Armadillo Investments, Plc. The number of Ordinary Shares to be issued will be based on the conversion rate in effect as of the close of business on the day preceding the closing of the transaction. For example, if the effective conversion rate is $1 .85/i 1, then Armadillo will issue $3,5000,000/$1.85, or 1,891,892 Ordinary Shares.

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(d)Notwithstanding anything to the contrary contained in this Agreement, the Company’s obligations hereunder shall be expressly contingent upon the Company selling the Armadillo Shares to a purchaser to be located by Purchaser simultaneously with receipt of the Armadillo Shares for a price not less than £ .50 per share.

2.2Execution and Delivery of Documents: The Closing.

(a)The Closing of the purchase and sale of the Shares (the “Closing”) shall take place simultaneously with the execution and delivery of this Agreement (the “Closing Date”). On the Closing Date,

(i)the Company shall execute and deliver to the Purchaser the certificates representing the Shares, which Shares shall have the respective rights, preferences and privileges as set forth in the Certificate of Designation annexed as Exhibit A hereto and the Power of Attorney;

(ii)the Company shall execute and deliver to the Purchaser a certificate of its President, in the form of Exhibit I annexed hereto, certifying that attached thereto is a copy of resolutions duly adopted by the Board of Directors of the Company authorizing the Company to execute and deliver the Transaction Documents and to enter into the transactions contemplated thereby;

(iii)the Company shall execute and deliver to Purchaser an executed Power of Attorney in the form annexed hereto as Exhibit G;

(iv)the Company and the Purchaser shall execute and deliver to each other an executed Registration Rights Agreement in the form annexed hereto as Exhibit;

(v)counsel for the Company shall execute and deliver to the Purchaser an executed copy of the opinion of counsel annexed hereto as Exhibit K;

(vi)the Company, the Escrow Agent and the Purchaser shall execute and deliver to each other an executed Escrow Agreement in the form annexed hereto as Exhibit M and the certificates representing the Escrow Shares as defined in the Escrow Agreement;

(vii)the Purchaser shall deliver to the Company the Armadillo Shares.

(b)Notwithstanding the foregoing, at Closing, the Company shall deliver to the Escrow Agent a certificate representing the Shares (the “Closing Stock Certificate”), that shall be held by the Escrow Agent upon the terms and conditions set forth in the Escrow Agreement, and that shall bear the following legends:

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(1) THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN OFFERED AND SOLD IN AN “OFFSHORE TRANSACTION” IN RELIANCE UPON REGULATION S AS PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION AND IN ACCORDANCE WITH SECTION 4(2) OF THE SECURITIES ACT OF 1933 (THE “SECURITIES ACT”). ACCORDINGLY, THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED OTHER THAN IN ACCORDANCE WITH REGULATION 5, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY.

(2) ADDITIONALLY, THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR OTHERWISE TRANSFERRED UNLESS AND UNTIL THE COMPANY SELLS THE ARMADILLO SHARES (AS DEFINED IN THE CONVERTIBLE STOCK PURCHASE AGREEMENT DATED AS OF MARCH 2004 BETWEEN THE COMPANY AND JUBILEE INVESTMENT TRUST PLC) AND PURCHASE PRICE FOR SUCH SHARES OF NOT LESS THAN FIFTY PERCENT(50%) of £1.00 PER SHARE, LESS BROKERAGE COMMISSIONS.

Promptly after the Company sells the Armadillo Shares and receives a purchase price for the Armadillo Shares of not less than fifty percent (50%) of £1.00 for each Armadillo Share, less brokerage commissions, the Company shall issue to the Escrow Agent a certificate representing the Shares that bears only paragraph (1) above as a legend (the “Final Stock Certificate”), in exchange for the Closing Stock Certificate in the manner provided in the Escrow Agreement. In the event that the Company is unable to sell the Armadillo Shares within ten (10) days of the Closing in the manner described in the previous sentence, the Company shall return the certificate for the Armadillo Shares to Purchaser, and the Escrow Agent shall return the Closing Stock Certificate to the Company.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

3.1Representations. Warranties and Agreements of the Company. The Company hereby makes the following representations and warranties to the Purchaser, all of which shall survive the Closing:

(a)Organization and Qualification. The Company is a corporation, duly incorporated, validly existing and in good standing under the laws of the State of Nevada, with the requisite corporate power and authority to own and use its properties and assets and to carry on its business as currently conducted. The Company has no subsidiaries other than as set forth on Schedule 3.1(a) attached hereto (collectively, the “Subsidiaries”). Each of the Subsidiaries is a corporation, duly incorporated, validly existing and in good standing under the laws of the jurisdiction of its incorporation, with the full corporate power and authority to own and use its properties and assets and to carry on its business as currently conducted. Each of the Company and the Subsidiaries is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would not, individually or in the aggregate, have a material adverse effect on the results of operations, assets, or financial condition of the Company and the Subsidiaries, taken as a whole (a “Material Adverse Effect”).

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(b)Authorization, Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated hereby and by each other Transaction Document and to otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby has been duly authorized by all necessary action on the part of the Company. Each of this Agreement and each of the other Transaction Documents has been or will be duly executed by the Company and when delivered in accordance with the terms hereof or thereof will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally the enforcement of, creditors’ rights and remedies or by other equitable principles of general application.

(c)Capitalization. The authorized, issued and outstanding capital stock of the Company is set forth on Schedule 3.1(c). No shares of the Series B Preferred Stock have been issued as of the date hereof. No shares of Common Stock are entitled to preemptive or similar rights, nor is any holder of the Common Stock entitled to preemptive or similar rights arising out of any agreement or understanding with the Company by virtue of this Agreement. Except as disclosed in Schedule 3.1(c), there are no outstanding options, warrants, script, rights to subscribe to, registration rights, calls or commitments of any character whatsoever relating to, or, except as a result of the purchase and sale of the Series B Preferred Stock hereunder, securities, rights or obligations convertible into or exchangeable for, or giving any person any right to subscribe for or acquire, any shares of Common Stock, or contracts, commitments, understandings, or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock, or securities or rights convertible or exchangeable into shares of Common Stock. Neither the Company nor any Subsidiary is in violation of any of the provisions of its Certificate of Incorporation, bylaws or other charter documents.

(d)Issuance of Securities. The Shares have been duly and validly authorized for issuance, offer and sale pursuant to this Agreement and, when issued and delivered as provided hereunder against payment in accordance with the terms hereof, shall be valid and binding obligations of the Company enforceable in accordance with their respective terms. The Company has and at all times while the Shares are outstanding will continue to maintain an adequate reserve of shares of Common Stock to enable it to perform its obligations under this Agreement and the Certificate of Designation. When issued in accordance with the terms hereof, the Underlying Shares and the Option Shares will be duly authorized, validly issued, fully paid and non-assessable. Except as set forth in Schedule 3.1(d) hereto, there is no equity or equity equivalent security outstanding that is substantially similar to the Shares, including any security having a floating conversion price substantially similar to the Shares.

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(e)No Conflicts. The execution, delivery and performance of this Agreement and the other Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby do not and will not (i) conflict with or violate any provision of its Certificate of Incorporation or bylaws (each as amended through the date hereof) or (ii) be subject to obtaining any consents except those referred to in Section 3.1(f), conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or its Subsidiaries is subject (including, but not limited to, those of other countries and the federal and state securities laws and regulations), or by which any property or asset of the Company or its Subsidiaries is bound or affected, except in the case of clause (ii), such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect. The business of the Company and its Subsidiaries is not being conducted in violation of any law, ordinance or regulation of any governmental authority.

(f)Consents and Approvals. Except as specifically set forth in Schedule 3.1(f), neither the Company nor any Subsidiary is required to obtain any consent, waiver, authorization or order of, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of this Agreement and each of the other Transaction Documents, except for the filing of the Certificate of Designation with respect to the Series B Preferred Stock with the Secretary of State of the State of Nevada, which filing shall be effected prior to the Closing Date (together with the consents, waivers, authorizations, orders, notices and filings referred to in Schedule 3.1(0, the “Required Approvals”).

(g)Litigation Proceedings. Except as specifically disclosed in Schedule 3.1(g), there is no action, suit, notice of violation, proceeding or investigation pending or, to the best knowledge of the Company, threatened against or affecting the Company or any of its Subsidiaries or any of their respective properties before or by any court, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) which (i) relates to or challenges the legality, validity or enforceability of any of the Transaction Documents, the Shares or the Underlying Shares, (ii) could, individually or in the aggregate, have a Material Adverse Effect or (iii) could, individually or in the aggregate, materially impair the ability of the Company to perform fully on a timely basis its obligations under the Transaction Documents.

(h)No Default or Violation. Except as set forth in Schedule 3.1(h) hereto, neither the Company nor any Subsidiary (i) is in default under or in violation of any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound, except such conflicts or defaults as do not have a Material Adverse Effect, (ii) is in violation of any order of any court, arbitrator or governmental body, except for such violations as do not have a Material Adverse Effect, or (iii) is in violation of any statute, rule or regulation of any governmental authority which could (individually or in the aggregate) (x) adversely affect the legality, validity or enforceability of this Agreement, (y) have a Material Adverse Effect or (z) adversely impair the Company’s ability or obligation to perform fully on a timely basis its obligations under this Agreement.

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(i)Intentionally omitted.

(j)Disclosure Documents. The Disclosure Documents are accurate in all material respects and do not contain any untrue statement of material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

(k)Non-Registered Offering. Neither the Company nor any Person acting on its behalf has taken or will take any action (including, without limitation, any offering of any securities of the Company under circumstances which would require the integration of such offering with the offering of the Securities under the Securities Act) which might subject the offering, issuance or sale of the Securities to the registration requirements of Section 5 of the Securities Act.

(l)Placing Agent. The Company accepts and agrees that Dungarvon Associates, Inc. (“Dungarvon”) is acting for the Purchaser and does not regard any person other than the Purchaser as its customer in relation to this Agreement, and that it has not made any recommendation to the Company, in relation to this Agreement and is not advising the Company, with regard to the suitability or merits of the Armadillo Shares and in particular Dungarvon has no duties or responsibilities to the Company for the best execution of the transaction contemplated by this Agreement.

(m)Private Placement Representations. The Company (i) has received and carefully reviewed such information and documentation relating to the Purchaser that the Company has requested, including, without limitation, the Purchaser’s Confidential Private Offering Memorandum dated January 1, 2004; (ii) has had a reasonable opportunity to ask questions of and receive answers from the Purchaser concerning the Armadillo Shares, and all such questions, if any, have been answered to the full satisfaction of the Company; (iii) has such knowledge and expertise in financial and business matters that it is capable of evaluating the merits and risks involved in an investment in the Armadillo Shares; (iii) understands that Armadillo has determined that the exemption from the registration provisions of the Securities Act of 1933, as amended (the “Securities Act”), provided by Section 4(2) of the Securities Act and Rule 506 of Regulation D thereunder is applicable to the offer and sale of the Armadillo Shares, based, in part, upon the representations, warranties and agreements made by the Company herein; and (iv) except as set forth herein, no representations or warranties have been made to the Company by the Purchaser or any agent, employee or affiliate of the Purchaser and in entering into this transaction the Company is not relying upon any information, other than the results of independent investigation by the Company.

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The Purchaser acknowledges and agrees that the Company makes no representation or warranty with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.1 hereof.

3.2Representations and Warranties of the Purchaser. The Purchaser hereby represents and warrants to the Company as follows:

(a)Organization Authority. The Purchaser is a corporation, duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation with the requisite power and authority to enter into and to consummate the transactions contemplated hereby and by the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The acquisition of the Shares to be purchased by the Purchaser hereunder has been duly authorized by all necessary action on the part of the Purchaser. This Agreement has been duly executed and delivered by the Purchaser and constitutes the valid and legally binding obligation of the Purchaser, enforceable against it in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws relating to, or affecting generally the enforcement of, creditors rights and remedies or by other general principles of equity.

(b)Investment Intent. The Purchaser is acquiring the Shares to be purchased by it hereunder, and will acquire the Underlying Shares relating to such Shares, and the Option Shares for its own account for investment purposes only and not with a view to or for distributing or reselling such Shares, Underlying Shares or Option Shares, or any part thereof or interest therein, without prejudice, however, to such Purchaser’s right, subject to the provisions of this Agreement, at all times to sell or otherwise dispose of all or any part of such Shares, Underlying Shares or Option Shares in compliance with applicable federal and state securities laws.

(c)Experience of Purchaser. The Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of an investment in the Securities to be acquired by it hereunder, and has so evaluated the merits and risks of such investment.

(d)Ability of Purchaser to Bear Risk of Investment. The Purchaser is able to bear the economic risk of an investment in the Securities to be acquired by it hereunder and, at the present time, is able to afford a complete loss of such investment.

(e)Access to Information. The Purchaser acknowledges that it has been afforded (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the Securities offered hereunder and the merits and risks of investing in such securities; (ii) access to information about the Company and the Company’s financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment in the Securities; and (iii) the opportunity to obtain such additional information which the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment and to verify the accuracy and completeness of the information that it has received about the Company.

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(f)Reliance. The Purchaser understands and acknowledges that (i) the Shares, Underlying Shares and Option Shares being offered and sold to it hereunder are being offered and sold without registration under the Securities Act in a private placement that is exempt from the registration provisions of the Securities Act under Section 4(2) of the Securities Act and (ii) the availability of such exemption depends in part on, and that the Company will rely upon the accuracy and truthfulness of, the foregoing representations and such Purchaser hereby consents to such reliance.

(g)Regulation S.

(i)The Purchaser understands and acknowledges that (A) the Shares acquired pursuant to this Agreement have not been registered under the Securities Act, are being sold in reliance upon an exemption from registration afforded by Regulation 5; and that such Shares have not been registered with any state Securities commission or authority; (B) pursuant to the requirements of Regulation 5, the Shares may not be transferred, sold or otherwise exchanged unless in compliance with the provisions of Regulation S and/or pursuant to registration under the Securities Act, or pursuant to an available exemption thereunder; and (C) other than as set forth in this Agreement between the Company and the Purchaser, the Company is under no obligation to register the Shares under the Securities Act or any state securities law, or to take any action to make any exemption from any such registration provisions available.

(ii)(A) The Purchaser is not a U.S. person and is not acquiring the Shares for the account of any U.S. person; (B) if a corporation, it is not organized or incorporated under the laws of the United States; (C) if a corporation, no director or executive officer is a national or citizen of the United States; and (D) it is not otherwise deemed to be a “U.S. Person” within the meaning of Regulation S.

(iii)The Purchaser, was not formed specifically for the purpose of acquiring the Shares purchased pursuant to this Agreement.

(iv)The Purchaser is purchasing the Shares for its own account and risk and not for the account or benefit of a U.S. Person as defined in Regulation S and no other person has any interest in or participation in the Shares or any right, option, security interest, pledge or other interest in or to the Shares. The Purchaser understands, acknowledges and agrees that it must bear the economic risk of its investment in the Shares for an indefinite period of time and that prior to any such offer or sale, the Company may require, as a condition to effecting a transfer of the Shares, an opinion of counsel, acceptable to the Company, as to the registration or exemption therefrom under the Shares Act and any state Shares acts, if applicable.

(v)The Purchaser will, after the expiration of the Restricted Period, as set forth under Regulation S Rule 903(b)(3)(iii)(A), offer, sell, pledge or otherwise transfer the Shares only in accordance with Regulation 5, or pursuant to an available exemption under the Securities Act and, in any case, in accordance with applicable state Securities laws. The transactions contemplated by this Subscription Agreement have neither been pre-arranged with a purchaser who is in the United States or who is a U.S. Person, nor are they part of a plan or scheme to evade the registration provisions of the United States federal securities laws.

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(vi)The offer leading to the sale evidenced hereby was made in an “offshore transaction.” For purposes of Regulation 5, the Purchaser understands that an “offshore transaction” as defined under Regulation S is any offer or sale not made to a person in the United States and either (A) at the time the buy order is originated, the purchaser is outside the United States, or the seller or any person acting on his behalf reasonably believes that the purchaser is outside the United States; or (B) for purposes of (1) Rule 903 of Regulation 5, the transaction is executed in, or on or through a physical trading floor of an established foreign exchange that is located outside the United States or (2) Rule 904 of Regulation 5, the transaction is executed in, on or through the facilities of a designated offshore securities market, and neither the seller nor any person acting on its behalf knows that the transaction has been prearranged with a buyer in the United States.

(vii)Neither the Purchaser nor any affiliate of the Purchaser or any person acting on its behalf has made or is aware of any “directed selling efforts” in the United States, which is defined in Regulation S to be any activity undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for any of the Shares being purchased hereby.

(viii)The Purchaser understands that the Company is the seller of the Shares which are the subject of this Agreement, and that, for purpose of Regulation 5, a “distributor” is any underwriter, dealer or other person who participates, pursuant to a contractual arrangement, in the distribution of securities offered or sold in reliance on Regulation S and that an “affiliate” is any partner, officer, director or any person directly or indirectly controlling, controlled by or under common control with any person in question. The Purchaser agrees that it will not, during the Restricted Period set forth under Rule 903(b)(iii)(A), act as a distributor, either directly or though any affiliate, nor shall it sell, transfer, hypothecate or otherwise convey the Shares other than to a non-U.S. Person.

(ix)The Purchaser acknowledges that the Shares will bear a legend in substantially the following form:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN OFFERED AND SOLD IN AN “OFFSHORE TRANSACTION” IN RELIANCE UPON REGULATION S AS PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION AND IN ACCORDANCE WITH SECTION 4(2)OF THE SECURITIES ACT OF 1933 (THE “SECURITIES ACT”).ACCORDINGLY, THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED OTHER THAN IN ACCORDANCE WITH REGULATION 5, PURSUANT TO REGISTRATION UNDER THE SECURITIES ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE SATISFACTION OF THE COMPANY. THE SECURITIES REPRESENTED BY THIS CERTIFICATE CANNOT BE THE SUBJECT OF HEDGING TRANSACTIONS UNLESS SUCH TRANSACTIONS ARE CONDUCTED INCOMPLIANCE WITH THE SECURITIES ACT.

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(h)Private Placement Memorandum. The Private Placement Memorandum does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made therein, in light of the circumstances in which they are made, not misleading.

The Company acknowledges and agrees that the Purchaser makes no representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in this Section 3.2.

ARTICLE IV

OTHER AGREEMENTS OF THE PARTIES

4.1Manner of Offering. The Securities are being issued pursuant to section 4(2) of the Securities Act and Regulation S thereunder. The Armadillo shares are being issued pursuant to section 4(2) of the Securities Act.

4.2Notice of Certain Events. The Company shall, on a continuing basis, (i) advise the Purchaser promptly after obtaining knowledge of, and, if requested by the Purchaser, confirm such advice in writing, of (A) the issuance by any state securities commission of any stop order suspending the qualification or exemption from qualification of the Shares or the Underlying Shares, for offering or sale in any jurisdiction, or the initiation of any proceeding for such purpose by any state securities commission or other regulatory authority (ii) use its best efforts to prevent the issuance of any stop order or order suspending the qualification or exemption from qualification of the Securities under any state securities or Blue Sky laws, and (iii) if at any time any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Securities under any such laws, and use its best efforts to obtain the withdrawal or lifting of such order at the earliest possible time.

4.3Blue Sky Laws. The Company shall cooperate with the Purchaser in connection with the exemption from registration of the Securities under the securities or Blue Sky laws of such jurisdictions as the Purchasers may request; provided, however, that neither the Company nor its Subsidiaries shall be required in connection therewith to qualify as a foreign corporation where they are not now so qualified. The Company agrees that it will execute all necessary documents and pay all necessary state filing or notice fees to enable the Company to sell the Securities to the Purchasers.

4.4Integration. The Company shall not and shall use its best efforts to ensure that no Affiliate shall sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act) that would be integrated with the offer or sale of the Securities in a manner that would require the registration under the Securities Act of the sale of the Securities to the Purchaser.

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4.5Furnishing of Rule 144(c) Materials. The Company shall, for so long as any of the Securities remain outstanding and during any period in which the Company is no longer subject to Section 13 or 15(d) of the Exchange Act, make available to any registered holder of the Securities (“Holder” or “Holders”) in connection with any sale thereof and any prospective purchaser of such Securities from such Person, such information in accordance with Rule 144(c) promulgated under the Securities Act as is required to sell the Securities under Rule 144 promulgated under the Securities Act.

4.6Solicitation Materials. The Company shall not (i) distribute any offering materials in connection with the offering and sale of the Shares or Underlying Shares other than the Disclosure Documents and any amendments and supplements thereto prepared in compliance herewith or (ii) solicit any offer to buy or sell the Shares or Underlying Shares by means of any form of general solicitation or advertising.

4.7Listing of Common Stock. If the Common Stock is or shall become listed on the OTCBB or on another exchange, the Company shall (a) use its best efforts to maintain the listing of its Common Stock on the OTCBB or such other exchange on which the Common Stock is then listed until expiration of the periods during which the Shares may be converted and (b) shall provide to the Purchaser evidence of such listing.

4.8Attorney-in-Fact. For the sole purpose of effectuating the terms and provisions of this Agreement and the Certificate of Designation, the Company hereby agrees to give a power of attorney to G&P as is evidenced by Exhibit G annexed hereto. All acts done under such power of attorney are hereby ratified and approved and neither the Attorney-in-Fact nor any designee or agent thereof shall be liable for any acts of commission or omission, for any error of judgment or for any mistake of fact or law, as long as the Attorney-in-Fact is operating within the scope of the power of attorney and this Agreement and its exhibits. The power of attorney, being coupled with an interest, shall be irrevocable while any of the Shares remain unconverted, or any portion of this Agreement remains unsatisfied. In addition, the Company shall give the Attorney-in-Fact resolutions executed by the Board of Directors of the Company which authorize transfers of the Shares and future issuances of the Underlying Shares for the Shares, and which resolutions state that they are irrevocable while any of the Shares remain unconverted, or any portion of this Agreement remains unsatisfied.

4.9Indemnification.

(a)Indemnification:

(i)The Company shall, notwithstanding termination of this Agreement and without limitation as to time, indemnify and hold harmless the Purchaser and its officers, directors, agents, employees and affiliates, each Person who controls or the Purchaser (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) (each such Person, a “Control Person”) and the officers, directors, agents, employees and affiliates of each such Control Person, to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, costs of preparation and attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising out of, or relating to, a breach or breaches of any representation, warranty, covenant or agreement by the Company under this Agreement or any other Transaction Document.

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(ii)The Purchaser shall, notwithstanding termination of this Agreement and without limitation as to time, indemnify and hold harmless the Company, its officers, directors, agents and employees, each Control Person and the officers, directors, agents and employees of each Control Person, to the fullest extent permitted by application law, from and against any and all Losses, as incurred, arising out of, or relating to, a breach or breaches of any representation, warranty, covenant or agreement by the Purchaser under this Agreement or the other Transaction Documents.

(b)Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified Party”), such Indemnified Party promptly shall notify the Person from whom indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall assume the defense thereof, including the employment of counsel reasonably satisfactory to the Indemnified Party and the payment of all fees and expenses incurred in connection with defense thereof provided, that the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying Party of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure shall have proximately and materially adversely prejudiced the Indemnifying Party.

An Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party or Parties unless: (1) the Indemnifying Party has agreed to pay such fees and expenses; or (2) the Indemnifying Party shall have failed promptly to assume the defense of such Proceeding and to employ counsel reasonably satisfactory to such Indemnified Party in any such Proceeding; or (3) the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and such Indemnified Party shall have been advised by counsel that a conflict of interest is likely to exist if the same counsel were to represent such Indemnified Party and the Indemnifying Party (in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to employ separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense of the claim against the Indemnified Party but will retain the right to control the overall Proceedings out of which the claim arose and such counsel employed by the Indemnified Party shall be at the expense of the Indemnifying Party). The Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without its written consent, which consent shall not be unreasonably withheld. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding.

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All fees and expenses of the Indemnified Party to which the Indemnified Party is entitled hereunder (including reasonable fees and expenses to the extent incurred in connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with this Section) shall be paid to the Indemnified Party, as incurred, within ten (10) Business Days of written notice thereof to the Indemnifying Party.

No right of indemnification under this Section shall be available as to a particular Indemnified Party if there is a non-appealable final judicial determination that such Losses arise solely out of the negligence or bad faith of such Indemnified Party in performing the obligations of such Indemnified Party under this Agreement or a breach by such Indemnified Party of its obligations under this Agreement.

(c)Contribution. If a claim for indemnification under this Section is unavailable to an Indemnified Party or is insufficient to hold such Indemnified Party harmless for any Losses in respect of which this Section would apply by its terms (other than by reason of exceptions provided in this Section), then each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such Losses in such proportion as is appropriate to reflect the relative benefits received by the Indemnifying Party on the one hand and the Indemnified Party on the other and the relative fault of the Indemnifying Party and Indemnified Party in connection with the actions or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether there was a judicial determination that such Losses arise in part out of the negligence or bad faith of the Indemnified Party in performing the obligations of such Indemnified Party under this Agreement or the Indemnified Party’s breach of its obligations under this Agreement. The amount paid or payable by a party as a result of any Losses shall be deemed to include any attorneys’ or other fees or expenses incurred by such party in connection with any Proceeding to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in this Section was available to such party.

(d)Non-Exclusivity. The indemnity and contribution agreements contained in this Section are in addition to any obligation or liability that the Indemnifying Parties may have to the Indemnified Parties.

4.10Notice and Consultation Before Securities Issuances. Until such time as Purchaser shall have sold all of the Shares and the Underlying Shares, the Company shall not offer or issue any equity, equity equivalent security or debt that with a floating conversion price, or any equity lines of credit (the “New Securities”), without first giving thirty (30) days notice thereof to the Purchaser and thereafter consulting in good faith with the Purchaser concerning such issuance. After such consultation between the Company and the Purchaser, the Company may offer or sell the New Securities on such terms and conditions as the Company deems appropriate. Purchaser shall keep all information concerning the New Securities confidential and shall not trade any of the Company’s securities until information about the New Securities is publicly disclosed or the Company advises the Purchaser that it has determined not to issue the New Securities.

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4.11Purchaser’s Ownership of Common Stock. In addition to and not in lieu of the limitations on conversion set forth in the Certificate of Designation, the conversion and exercise rights of the Purchaser set forth in the Certificate of Designation shall be limited, solely to the extent required, from time to time, such that, unless the Purchaser gives written notice seventy five (75) days in advance to the Company of the Purchaser’s intention to exceed the Limitation on Conversion as defined herein, with respect to all or a specified amount of the Shares and the corresponding number of the Underlying Shares, in no instance shall the maximum number of shares of Common Stock which the Purchaser (singularly, together with any Persons who in the determination of the Purchaser, together with the Purchaser, constitute a group as defined in Rule 1 3d-S of the Exchange Act) may receive in respect of any conversion of the Shares exceed, at any one time, an amount equal to four and ninety nine one hundredths percent (4.99%) of the then issued and outstanding shares of Common Stock of the Company following such conversion (the foregoing being herein referred to as the “Limitation on Conversion”); provided, however, that the Limitation on Conversion shall not apply to any forced or automatic conversion pursuant to this agreement or the Certificate of Designation; and provided, further that if the Purchaser shall have declared an Event of Default and, if a cure period is provided, the Company shall not have properly and fully cured such Event of Default within any such cure period, the provisions of this Section 4.11 shall be null and void from and after such date. The Company shall, promptly upon its receipt of a Notice of Conversion tendered by the Purchaser (or its sole designee) for the Shares, as applicable, notify the Purchaser by telephone and by facsimile of the number of shares of Common Stock outstanding on such date and the number of Underlying Shares which would be issuable to the Purchaser (or its sole designee, as the case may be) if the conversion requested in such Notice of Conversion or exercise requested in such Notice of Exercise were effected in full, whereupon, in accordance with the Certificate of Designation and notwithstanding anything to the contrary set forth therein, the Purchaser may within one (1) Business Day of its receipt of the Company notice required by this Section 4.11 by facsimile revoke such conversion or exercise to the extent (in whole or in part) that the Purchaser determines that such conversion or exercise would result in the ownership by the Purchaser of shares of Common Stock in excess of the Limitation on Conversion.

4.12No Violation of Applicable Law. Notwithstanding any provision of this Agreement to the contrary, if the redemption of the Shares otherwise required under this Agreement or the Certificate of Designation would be prohibited by the relevant provisions of Delaware law, such redemption shall be effected as soon as it is permitted under such law; provided, however, that interest payable by the Company with respect to any such redemption shall accrue in accordance with Article X(e) of the Certificate of Designation until such redemption is effected.

4.13Redemption Restrictions. Notwithstanding any provision of this Agreement to the contrary, if any redemption of the Shares otherwise required under this Agreement or the Certificate of Designation would be prohibited in the absence of consent from any lender to the Company or any of the Subsidiaries, or by the holders of any class of securities of the Company, the Company shall use its best efforts to obtain such consent as promptly as practicable after any such redemption is required. Interest payable by the Company with respect to any such redemption shall accrue in accordance with Article X(e) of the Certificate of Designation until such consent is obtained. Nothing contained in this Section 4.13 shall be construed as a waiver by the Purchaser of any rights they may have by virtue of any breach of any representation or warranty of the Company herein as to the absence of any requirement to obtain any such consent.

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4.14Option for Additional Company Shares. The Company hereby grants to Purchaser an option to acquire that number of shares of the Company’s Common Stock (the “Option Shares”), such option to be exercisable during the thirty (30) day period commencing on the date Purchaser completes the conversion of all of the Series B Preferred Stock (the “Conversion Completion Date”), equal to the difference, if a positive amount, between (a) the number of the Company’s shares of Common Stock into which the original amount of the Series B Preferred Stock would have been convertible on the Closing Date at a conversion price equal to fifty percent (50%) of the Fixed Conversion Price (as defined in the Certificate of Designation) less (b) the aggregate number of the shares of Common Stock into which the original amount of the Series B Preferred Stock has actually been converted as of the Conversion Completion Date. The exercise price for the Option Shares shall be the closing bid price for the Company’s Common stock on the Closing Date plus ten cents ($.10). In case of any stock split, stock dividend, reclassification of the Common Stock, any consolidation or merger of the Company with or into another person, the sale or transfer of all or substantially all of the assets of the Company or any compulsory share exchange pursuant to which the Common Stock is converted into other securities, cash or property, then each Option Share then outstanding shall have the right thereafter upon exercise to receive only such shares of stock and other securities and property receivable upon or deemed to be held by holders of Common Stock following such stock split, stock dividend, reclassification, consolidation, merger, sale, transfer or share exchange (except in the event the property is cash, then the Purchaser shall have the right to exercise the Option Shares and receive cash in the same manner as other stockholders). In such event, if appropriate, the exercise price for the Option Shares shall be proportionately adjusted.

4.15Lock-Up Agreement. Purchaser agrees not to sell, transfer or assign all or any part of the Series B Preferred Stock or the Underlying Shares for a period of two (2) years following the Closing Date, without the express written consent of the Company. Notwithstanding the foregoing, Purchaser may convert the Series B Preferred Stock at any time and from time to time following the Closing Date.

4.16Use of Proceeds. The Company agrees that none of the proceeds from the sale of the Series B Preferred Stock shall be used to repay loans owed by the Company to any of its shareholders.

ARTICLE V

MISCELLANEOUS

5.1Fees and Expenses. Except as set forth in this Agreement, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all stamp and other taxes and duties levied in connection with the issuance of the Shares (and, upon conversion or exercise thereof the Underlying Shares) pursuant hereto. The Purchaser shall be responsible for any taxes payable by the Purchaser that may arise as a result of the investment hereunder or the transactions contemplated by this Agreement or any other Transaction Document. The Company agrees to pay a total Purchaser’s counsel $7,500 for legal fees associated with the transactions contemplated by this Agreement, $5,000 prior to document preparation and $2,500 at Closing, and $5,000 for escrow services pursuant to the Escrow Agreement, payable at or prior to Closing, and the reasonable disbursements of counsel in connection with the transactions contemplated by this Agreement. The Company shall pay all costs, expenses, fees and all taxes incident to and in connection with: (A) the issuance and delivery of the Securities, (B) the exemption from registration of the Securities for offer and sale to the Purchaser under the securities or Blue Sky laws of the applicable jurisdictions, and (C) the preparation of certificates for the Securities (including, without limitation, printing and engraving thereof), and (D) all fees and expenses of counsel and accountants of the Company.

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5.2Entire Agreement. This Agreement, together with all of the Exhibits and Schedules annexed hereto, and any other Transaction Document contains the entire understanding of the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters. This Agreement shall be deemed to have been drafted and negotiated by both parties hereto and no presumptions as to interpretation, construction or enforceability shall be made by or against either party in such regard.

5.3Notices. Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given upon facsimile transmission (with written transmission confirmation report) at the number designated below (if delivered on a Business Day during normal business hours where such notice is to be received), or the first Business Day following such delivery (if delivered other than on a Business Day during normal business hours where such notice is to be received) whichever shall first occur. The addresses for such communications shall be:

If to the Company: Market Central, Inc. 1650A Gum Branch Road Jacksonville, NC 28540 Attn: CEO Tel: Fax:

With copies to: Greenberg Traurig, LLP Suite 400 3290 Northside Parkway Atlanta, GA 30327 Attn: Gerald L. Baxter, Esq. Tel: (678) 553-2430 Fax: (678) 553-2431

If to the Purchaser: See Schedule 1 attached hereto

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With copies to: Gottbetter & Partners, LLP 12th Floor 488 Madison Avenue New York, NY 10022 Attn: Adam S. Gottbetter, Esq. Tel: (212) 400-6900 Fax: (212) 400-6901

or such other address as may be designated hereafter by notice given pursuant to the terms of this Section 5.3.

5.4Amendments; Waivers. No provision of this Agreement may be waived or amended except in a written instrument signed, in the case of an amendment, by both the Company and the Purchaser, or, in the case of a waiver, by the party against whom enforcement of any such waiver is sought. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of either party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter.

5.5Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

5.6No Third Party Beneficiaries. This Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

5.7Governing Law/Venue/Service of Process. The parties hereto acknowledge that the transactions contemplated by this Agreement and the exhibits hereto bear a reasonable relation to the State of New York. The parties hereto agree that the internal laws of the State of New York shall govern this Agreement and the exhibits hereto, including, but not limited to, all issues related to usury. Any action to enforce the terms of this Agreement or any of its exhibits, or any other Transaction Document shall be brought exclusively in the state and/or federal courts situate in the County and State of New York. Service of process in any action by the Purchaser to enforce the terms of this Agreement may be made by serving a copy of the summons and complaint, in addition to any other relevant documents, by commercial overnight courier to the Company at its principal address set forth in this Agreement.

5.8Survival. The representations and warranties of the Company and the Purchaser contained in Article III and the agreements and covenants of the parties contained in Article IV and this Article V shall survive the Closing for a period of one (1) year.

5.9Counterpart Signatures. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such facsimile signature page were an original thereof.

5.10Publicity. The Company and the Purchaser shall consult with each other in issuing any press releases or otherwise making public statements with respect to the transactions contemplated hereby and neither party shall issue any such press release or otherwise make any such public statement without the prior written consent of the other, which consent shall not be unreasonably withheld or delayed, unless counsel for the disclosing party deems such public statement to be required by applicable federal and/or state securities laws. Except as otherwise required by applicable law or regulation, the Company will not disclose to any third party (excluding its legal counsel, accountants and representatives) the names of the Purchaser.

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5.11Severability. In case any one or more of the provisions of this Agreement shall be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Agreement shall not in any way be affected or impaired thereby and the parties will attempt to agree upon a valid and enforceable provision which shall be a reasonable substitute therefore, and upon so agreeing, shall incorporate such substitute provision in this Agreement.

5.12Limitation of Remedies. With respect to claims by the Company or any person acting by or through the Company, or by the Purchaser or any person acting through the Purchaser, for remedies at law or at equity relating to or arising out of a breach of this Agreement, liability, if any, shall, in no event, include loss of profits or incidental, indirect, exemplary, punitive, special or consequential damages of any kind.

5.13Successors and Assigns. This Agreement shall become effective when it is executed by the parties and shall thereafter be binding upon and enure to the benefit of the parties hereto and their permitted successors and assigns. This agreement and any of the rights, interests or obligations hereunder may be assigned by the Purchaser without the consent of the Company, provided that notwithstanding such assignment, Purchaser’s obligations hereunder shall continue as if such assignment had not occurred.

5.14Legal Fees and Interest Default Rate. In the event any party hereto commences legal action to enforce its rights under this Agreement or any other Transaction Document, the non-prevailing party shall pay all reasonable costs and expenses (including but not limited to reasonable attorney’s fees, accountant’s fees, appraiser’s fees and investigative fees) incurred in enforcing such rights. In the event of an uncured Event of Default by any party hereunder, interest shall accrue on all unpaid amounts due the aggrieved party at the rate of ten percent (10%) per annum, compounded annually.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first indicated above.

Company:

Market Central, Inc.

By: ______________________________

Name: ____________________________

Title: _____________________________

Purchaser:Dungarvon Associates, Inc., on behalf of Armadillo Investments, PLC

By: ______________________________

Name: ____________________________

Title: _____________________________

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	Schedule 1
	Purchaser(s)
Name and Address of Purchaser	Purchase Price	No. of Share
Armadillo Investments Plc. 30 Farringdon Street London EC4A 4HJ Fax:011.44.20.7724.0090	$3,500,000	350,000

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EX-4.5

Exhibit 4.5

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) dated as of March 25,2004, by and between Market Central, Inc., a Delaware corporation with its principal place of business at 1 650A Gum Branch Road, Jacksonville, NC 28540 (the “Company”), and Armadillo Investments, Plc., a company incorporated in England and Wales, with its principal place of business at 30 Farringdon Street, London EC4A 4HJ (the “Purchaser”).

Simultaneously with the execution and delivery of this Agreement, the Purchaser and the Company have entered into a Convertible Preferred Stock Purchase Agreement, dated as of the date hereof (the “Purchase Agreement”), which Purchase Agreement is incorporated herein by reference, and pursuant to which the Purchaser has agreed to purchase Series B Preferred Stock (the “Shares”), that is convertible into Common Stock, par value $.00l per share of the Company (the “Underlying Shares”), and has an option to acquire Common Stock, par value $.001 of the Company (the “Option Shares”), all as more particularly provided therein.

The Company and the Holder hereby agree as follows:

1.Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings given to such terms in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings:

“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls or is controlled by or under common control with such Person. For the purposes of this definition only, the term “control,” when used with respect to any Person, means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise; and the terms “affiliated,”“controlling” and “controlled” have meanings correlative to the foregoing.

“Business Day” means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the state of New York are authorized or required by law or other government actions to close between the hours of 9:30 a.m. and 5:00 p.m. New York Time.

“Commission” means the United States Securities and Exchange Commission.

“Common Stock” means the Company’s common stock, par value $.0l per share.

“Event” shall have the meaning set forth in Section 7 hereof.

“Event Date” shall have the meaning set forth in Section 7 hereof.

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

“Holder” or “Holders” means the Purchaser and any other holder or holders, as the case may be, from time to time of Registrable Securities.

“Indemnified Party” shall have the meaning set forth in Section 6(c) hereof.

“Indemnifying Party” shall have the meaning set forth in Section 6(c) hereof.

“Inspectors” shall have the meaning set forth in Section 5(a)(viii) hereof.

“Losses” shall have the meaning set forth in Section 6(a) hereof.

“New York Courts” shall have the meaning set forth in Section 10(e) hereof.

“Person” means an individual or a corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or political subdivision thereof) or other entity of any kind.

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an investigation or partial proceeding, such as a deposition), whether commenced or threatened.

“Prospectus” means the prospectus included in a Registration Statement (including, without limitation, a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement, and all other amendments and supplements to the prospectus, including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such prospectus.

“Registrable Securities” means the Underlying Shares and the Option Shares, and any other shares of Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right, or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the Shares, the Underlying Shares and the Option Shares, excluding in all cases, however, any Registrable Securities sold by a Person in a transaction in which the seller’s rights under this Agreement are not assigned.

“Registration” shall have the meaning set forth in Section 3(a) hereof.

“Registration Expenses” means all expenses incurred in effecting any registration pursuant to this Agreement, including, without limitation, all registration, qualification, and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Company, blue sky fees and expenses, expenses of any regular or special audits incident to or required by any such registration, and the compensation of regular employees of the Company, but shall not include Selling Expenses, and fees and disbursements of counsel and accountants for the Selling Holders.

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“Registration Statement” means each registration statement, contemplated by Section 3(a) hereof, including the prospectus, amendments and supplements to such registration statement or prospectus, including pre- and post-effective amendments, all exhibits thereto, and all material incorporated by reference or deemed to be incorporated by reference in such registration statement.

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such rule.

“Rule 144A” means Rule 144A promulgated by the Commission pursuant to the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such rule.

“Rule 415” shall mean Rule 415 as promulgated by the Commission under the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such rule.

“Rule 158” means Rule 158 promulgated by the Commission pursuant to the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same effect as such rule.

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

“Selling Expenses” means the underwriting or sales discounts and commissions charged with respect to the sale of Registrable Securities.

“Selling Holders” means each Holder any of whose Registrable Securities are being registered pursuant to a Registration Statement.

“Underwritten Registration or “Underwritten Offering” means a registration in connection with which securities of the Company are sold to an underwriter for sale to the public pursuant to an effective registration statement.

2.Restrictions on Transfer.

(a)Each Holder agrees not to offer, sell, transfer, pledge, assign, hypothecate or otherwise dispose of all or any portion of its Registrable Securities unless and until the transferee has agreed in writing for the benefit of the Company to be bound by the terms of this Agreement and;

(i)There is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with such registration statement; or

(ii)Such Holder shall have (A) notified the Company of the proposed disposition and shall have furnished the Company with a detailed statement of the circumstances surrounding the proposed disposition, and (B) furnished the Company with an opinion of counsel, reasonably satisfactory to the Company, that such disposition will not require registration of such shares under the Securities Act.

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(b)Each certificate representing Registrable Securities shall bear the following legend:

THE SHARES OF COMMON STOCK REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”) OR APPLICABLE STATE “BLUE SKY” OR SECURITIES LAWS (“STATE LAWS”), AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS AND UNTIL (i) REGISTERED UNDER THE ACT AND APPLICABLE STATE LAWS OR (ii) THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.

(c)The Company shall be obligated to reissue promptly unlegended certificates at the request of any Holder thereof if the Holder shall have obtained an opinion of counsel at such Holder’s expense (which counsel may be counsel to the Company) reasonably acceptable to the Company to the effect that the securities proposed to be disposed of may lawfully be so disposed of without registration, qualification or legend;

(d)Any legend endorsed on an instrument pursuant to applicable state securities laws and the stop-transfer instructions with respect to such securities shall be removed upon receipt by the Company of an order of the appropriate blue sky authority authorizing such removal.

3.“Piggy-back” Registrations.

(a)If the Company decides to register any of its Common Stock or securities convertible into or exchangeable for Common Stock under the Securities Act (a “Registration”) on a form that is suitable for an offering of shares of Common Stock by the Company or by third parties and that is not a registration solely to implement an employee benefit plan on form S-8, a registration statement on Form 5-4 (or successor form) or a transaction to which Rule 145 or any other similar rule of the Commission is applicable (such form, a “Registration Statement”), the Company shall give written notice to the Holders of its intention to effect such a Registration. Subject to Section 3(b) below, the Company shall use all reasonable efforts to effect Registration under the Securities Act of all Registrable Securities that the Holders request be included in such Registration by a written notice delivered to the Company within thirty (30) days after the notice given by the Company. Each of the Holders agrees that any Registrable Securities which such Holder requests to be included in a Registration pursuant to this Section 3 shall be included by the Company on the same form of Registration Statement as selected for the Registration;

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(b)If a Registration involves an underwritten offering, the Company shall not be required to register securities in excess of the amount that the principal underwriter reasonably and in good faith recommends in writing for inclusion in such offering (a “Cutback”), a copy of which recommendation, and supporting reasoning, shall be delivered to each Holder. If such a Cutback occurs, the number of shares that are entitled to be included in the Registration and underwriting shall be allocated in the following manner: (i) first, to the Company for any securities it proposes to sell for its own account, (ii) second, to any Person with demand registration rights requiring such registration, and (iii) third, to the Holders and other holders of Company securities with piggy-back registration rights requesting inclusion in the Registration, pro rata among the respective holders thereof on the basis of the number of shares for which each such requesting holder has requested registration;

(c)If the Registration of which the Company gives notice is for an underwritten public offering, the Company shall so advise the Holders as a part of the written notice given pursuant to Section 3(a). In such event, the right of any Holder to have its Registrable Securities included in the Registration pursuant to this Section 3 shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company and its other security holders with registration rights to participate therein distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the representative of the underwriters or the managing underwriter selected by the Company;

(d)If the Company elects to terminate any Registration after a Registration Statement for such Registration shall have been filed, the Company will have no obligation to register the Registrable Securities that the Holders sought to have included in such Registration. The Company shall bear all Registration Expenses of the Holders in connection with any Registration.

4.Representations and Warranties.

(a)The Company hereby makes the following representations and warranties to the Purchaser:

(i)The Company has the requisite corporate power and authority to enter into, execute and deliver this Agreement, and to consummate the transactions contemplated hereby and to carry out its obligations hereunder. The execution and delivery of this Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Company. This Agreement has been duly executed and delivered by the Company and constitutes the valid and binding obligations of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally the enforcement of, creditors’ rights or by other equitable principles of general application;

(ii)The Shares are validly issued, fully paid and non-assessable. The Underlying Shares and the Option Shares have been duly authorized for issuance, offer and sale, and when issued and delivered, in accordance with the Purchase Agreement, shall be validly issued, fully paid and non-assessable;

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(iii)The Company has and at all times while Shares remain outstanding and the Option Shares remain unissued, has and will continue to maintain an adequate reserve of shares of Common Stock to enable it to perform its obligations under this Agreement and the Purchase Agreement;

(iv)The execution, delivery and performance of this Agreement, and the consummation by the Company of the transactions contemplated hereby do not and will not (i) conflict with or violate any provision of its or any Subsidiary’s articles of incorporation, resolutions or bylaws or (ii) require the consent of any third party, conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company is subject (including federal and state securities laws and regulations), or by which any property or assets of the Company or any of its Subsidiaries is bound or affected, except in the case of each of clauses (ii) and (iii), such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect (as defined in the Purchase Agreement);

(v)Neither the Company nor any Subsidiary is required to obtain any consent, permit, waiver, authorization or order of, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of this Agreement;

(vi)Neither the Company nor any Subsidiary (i) is in default under or in violation of any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound, except such conflicts or defaults as do not have a Material Adverse Effect, (ii) is in violation of any order of any court, arbitrator or governmental body, except for such violations as do not have a Material Adverse Effect, or (iii) is in violation of any statute, rule or regulation of any governmental authority which could (individually or in the aggregate) (x) adversely affect the legality, validity or enforceability of this Agreement, (y) have a Material Adverse Effect or (z) adversely impair the Company’s ability or obligation to perform fully on a timely basis its obligations under this Agreement;

(b)The Purchaser hereby represents and warrants to the Company as follows:

(i)Such Purchaser is a corporation duly incorporated and validly existing and in good standing under the laws of the jurisdiction of its incorporation.

(ii)Such Purchaser has the requisite corporate power and authority to enter into and to consummate the transactions contemplated hereby and otherwise to carry out its obligations hereunder. The execution and delivery of this Agreement have been duly authorized by all necessary corporate action on the part of such Purchaser. This Agreement has been duly executed and delivered by such Purchaser or on its behalf and constitutes the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms; except as such enforceability may be limited by applicable bankruptcy, insolvency, liquidation, fraudulent transfer, reorganization, moratorium laws and remedies or by other equitable principles of general application or similar laws relating to or affecting generally the enforcement of creditors’ rights.

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(iii)Purchaser is acquiring the Shares and the Option Shares for its own account for investment purposes only and without a view toward the resale or distribution thereof, without prejudice, however, to the Purchaser’s right, subject to the provisions of this Agreement, at all times to sell or otherwise dispose of all or any part of such Shares or Option Shares in compliance with applicable federal and state securities laws.

5.Procedures for Registration.

(a)Whenever the Company is required to register Registrable Securities under this Agreement, it agrees to do the following at its sole cost and expense:

(i)advise the underwriter(s), if any, and the Selling Holders promptly and, if requested by such Persons, to confirm such advice in writing: (A) when the prospectus, or any prospectus supplement or post-effective amendment has been filed, and, with respect to the Registration Statement or any post-effective amendment thereto, when the same has become effective; (B) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the prospectus or for additional information relating thereto; (C) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the Registrable Securities for qualification, offering or sale in any jurisdiction, or the initiation of any Proceeding for any of the preceding purposes; and (D) of the existence of any fact or the happening of any event that makes any statement of a material fact made in the Registration Statement, the prospectus, any amendment or supplement thereto, or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Registration Statement or the prospectus in order to make the statements therein not misleading. If, at any time, the Commission issues any stop order suspending the effectiveness of the Registration Statement or any state securities commission or other regulatory authority issues an order suspending the qualification or exemption from qualification of any Registrable Securities under state securities or Blue Sky laws, the Company shall use its best efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

(ii)if requested by any Selling Holder or the underwriter(s), if any, incorporate in the Registration Statement or prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as such Selling Holder and the underwriter(s), if any, may reasonably request to have included therein, with respect to the number of Registrable Securities, if any, being sold to such underwriter(s), the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering, and the Company shall make all required filings of such prospectus supplement or post-effective amendment as soon as practicable after the Company is notified of the matters to be incorporated in such prospectus supplement or post-effective amendment;

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(iii)furnish to the Selling Holders and each of the underwriter(s), if any, without charge, before filing with the Commission, at least one copy of the Registration Statement, as first filed with the Commission, and of each amendment thereto, including the prospectus and all documents incorporated by reference therein and all exhibits (including exhibits incorporated therein by reference);

(iv)consult with the Selling Holders and the underwriter(s), if any, prior to the filing of such Registration Statement or prospectus;

(v)deliver to each of the Selling Holders and underwriter(s), if any, without charge, as many copies of the prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Persons may reasonably request, the Company hereby consenting to the use of the prospectus and any amendment or supplement thereto by each of the Selling Holders and each of the underwriter(s), if any, in connection with the offering and the sale of any Registrable Securities covered by the prospectus or any amendment or supplement thereto;

(vi)use its best efforts, prior to any public offering of Registrable Securities, to register or qualify the Registrable Securities under the securities or blue sky laws of such jurisdictions as the Holder or underwriter(s), if any, may reasonably request and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Registrable Securities covered by the Registration Statement; provided,however, that the Company shall not be required to register or qualify as a foreign corporation where it is not now so qualified or to take any action that would subject it to the service of process in suits or to taxation, other than as to matters and transactions relating to the Registration Statement, in any jurisdiction where it is not now so subject;

(vii)cooperate with the Selling Holders and the underwriter(s), if any, to facilitate the timely preparation and delivery of certificates representing Registrable Securities covered by a Registration Statement and not bearing any restrictive legends, except as required by law, and enable such Registrable Securities to be in such denominations and registered in such names as the Holders may request prior to any sale of Registrable Securities made by the underwriter(s), if any;

(viii)in connection with the preparation and filing of each Registration Statement under the Securities Act pursuant to this Agreement, the Company shall give Selling Holders, their underwriters, if any, and one counsel or firm of counsel and one accountant or firm of accountants representing all Selling Holders the opportunity to participate in the preparation of such Registration Statement, each prospectus included therein or filed with the Commission, and each amendment thereof or supplement thereto.

(ix)make available for inspection by the Selling Holders, any underwriter participating in any disposition pursuant to a Registration Statement, and any attorney, accountant or other agent retained by any Holder or underwriter (collectively, the “Inspectors”), all financial and other records, pertinent corporate documents and properties of the Company necessary to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any such Inspector in connection with such Registration Statement;

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(x)notify each seller of Registrable Securities covered by a Registration Statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in the Registration Statement, as then in effect, includes and untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading or incomplete in the light of the circumstances then existing, and, at the request of any such seller, prepare and furnish to such seller a reasonable number of copies of a supplement to be an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of any Registrable Securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading or incomplete in the light of the circumstances then existing;

(xi)keep such registration effective for a period of one hundred eighty (180) days or until the Selling Holders have completed the distribution described in any Registration Statement relating thereto, whichever first occurs; provided,however, that (A) such 180-day period shall be extended for a period of time equal to the longer of (1) the period the Holder refrains from selling any securities included in such registration at the request of an underwriter of securities of the Company and (2) the period ending on the date on which Rule 144(k) first becomes available for transfers of Registrable Securities and (B) in the case of any Registration of Registrable Securities on Form S-3 which are intended to be offered on a continuous or delayed basis, such 180-day period shall be extended, if necessary, to keep the Registration Statement effective until all such Registrable Securities are sold, however in no event longer than one year from the Effective Date of the Registration Statement and provided that Rule 415 permits an offering on a continuous or delayed basis;

(xii)cause all such Registrable Securities registered hereunder to be listed on each securities exchange on which similar securities issued by the Company are then listed;

(xiii)provide a transfer agent and registrar for all Registrable Securities registered pursuant to a Registration Statement and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such Registration Statement;

(xiv)otherwise use its best efforts to comply with all applicable rules and regulations of the Commission, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve months, but not more than eighteen months, beginning with the first month after the effective date of the Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act; and

(xv)at such time as a Registration Statement covering a resale of any Registrable Securities has been declared effective by the Commission, cause its counsel to deliver to the transfer agent for the Common Stock an opinion, subject to the making by Selling Holders of such representations and warranties to Company counsel as it may reasonably require, certifying that such Registrable Securities may be sold by the Selling Holders pursuant to such Registration Statement with the purchasers thereof receiving share certificates without restrictive legend, which opinion shall remain effective so long as such Registration Statement remains in full force and effect;

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(b)Each Selling Holder shall, upon receipt of notice from the Company of the occurrence of any event of the kind described in Section 4(a)(x), forthwith discontinue disposition of Registrable Securities following the effective date of a Registration Statement covering Registrable Securities until such Holder’s receipt of copies of the prospectus supplement and/or post-effective amendment or until it is advised in writing by the Company that the use of the applicable prospectus may be resumed and, in either case, has received copies of any additional or supplemental filings that are incorporated or deemed to be incorporated by reference in such prospectus or Registration Statement.

(c)Each Holder covenants and agrees that (i) it will not offer or sell any Registrable Securities being registered pursuant to any Registration Statement until such Holder shall have received copies of the related prospectus and notice from the Company that such Registration Statement has become effective and (ii) such Holder and its officers, directors and Affiliates, if any, will comply with the prospectus delivery requirements of the Securities Act as applicable to them in connection with sales of Registrable Securities pursuant to any Registration Statement.

6.Indemnification.

(a)Indemnification by the Company. The Company shall, notwithstanding termination of this Agreement and without limitation as to time, indemnify and hold harmless each Holder, the officers, directors, agents (including any underwriters retained by the Holders in connection with the offer or sale of Registrable Securities), brokers, investment advisors and employees of each of them, each Person who controls any such Holder (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) and the officers, directors, agents and employees of each such controlling Person, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, costs of preparation and attorneys’ fees) and expenses (collectively, “Losses”), as incurred, arising out of or relating to any untrue or alleged untrue statement of a material fact contained in such Registration Statement, any prospectus or any form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus or form of prospectus or amendment or supplement thereto, in light of the circumstances under which they were made) not misleading, except solely to the extent that (I) such untrue statements or omissions are based solely upon information regarding such Holder furnished in writing to the Company by or on behalf of such Holder expressly for use therein, which information was relied on by the Company for use therein or (ii) such information relates to such Holder or such Holder’s proposed method of distribution of Registrable Securities and was furnished in writing to the Company by or on behalf of such Holder expressly for use therein. The Company shall notify the Holders promptly of the institution, threat or assertion of any Proceeding of which the Company is aware in connection with the transactions contemplated by this Agreement.

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(b)Indemnification by Holders. In connection with each Registration Statement, each Selling Holder shall furnish to the Company in writing such information as the Company reasonably requests for use in connection with such Registration Statement or the related prospectus and agrees, severally and not jointly, to indemnify and hold harmless the Company, their directors, officers, agents and employees, each Person who controls the Company (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, agents or employees of such controlling Persons, to the fullest extent permitted by applicable law, from and against all Losses (as determined by a court of competent jurisdiction in a final judgment not subject to appeal or review) arising solely out of or based solely upon any untrue statement of a material fact contained in such Registration Statement, such prospectus, or any form of prospectus, or arising solely out of or based solely upon any omission of a material fact required to be stated therein or necessary to make the statements therein not misleading solely to the extent that (I) such untrue statement or omission is contained in any information furnished in writing by such Holder to the Company specifically for inclusion in such Registration Statement or such prospectus and such information was relied upon by the Company for use in such Registration Statement, such prospectus or such form of prospectus, or (ii) such information relates to such Holder or such Holder’s proposed method of distribution of Registrable Securities and was furnished in writing by or on behalf of such Holder to the Company specifically for inclusion in such Registration Statement or such prospectus and such information was relied upon by the Company for use in such Registration Statement, such prospectus or such form of prospectus; provided, however, that anything contained herein to the contrary notwithstanding, no Holder shall be liable for any claims hereunder in an amount in excess of the net proceeds received by such Holder from the sale of its Registrable Securities pursuant to a Registration Statement. In addition, the foregoing shall not inure to the benefit of any Holder if a copy of such prospectus (as then amended or supplemented) was furnished by the Company to such Holder and was not sent or given by or on behalf of such Holder to such Holder’s purchaser of Registrable Securities if required by law to have been so delivered.

(c)Conduct of Indemnification Proceedings. If any Proceeding is brought or asserted against any Person entitled to indemnity hereunder (an “Indemnified Party”), such Indemnified Party promptly shall notify the Person from whom indemnity is sought (the “Indemnifying Party”) in writing, and the Indemnifying Party shall assume the defense thereof, including the employment of counsel reasonably satisfactory to the Indemnified Party and the payment of all fees and expenses incurred in connection with defense thereof provided that the failure of any Indemnified Party to give such notice shall not relieve the Indemnifying Party of its obligations or liabilities pursuant to this Agreement, except (and only) to the extent that it is finally determined by a court of competent jurisdiction (which determination is not subject to appeal or further review) that such failure shall have proximately and materially adversely prejudiced the Indemnifying Party.

An Indemnified Party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof but the fees and expenses of such counsel shall be at the expense of such Indemnified Party or Parties unless: (I) the Indemnifying Party has agreed to pay such fees and expenses; or (ii) the Indemnifying Party shall have failed to assume promptly the defense of such Proceeding and to employ counsel reasonably satisfactory to such Indemnified Party in such Proceeding; or (iii) the named parties to any such Proceeding (including any impleaded parties) include both such Indemnified Party and the Indemnifying Party, and such Indemnified Party shall have been advised by counsel that a conflict of interest is likely to exist if the same counsel were to represent such Indemnified Party and the Indemnifying Party (in which case, if such Indemnified Party notifies the Indemnifying Party in writing that it elects to employ separate counsel at the expense of the Indemnifying Party, the Indemnifying Party shall not have the right to assume the defense of the claim against the Indemnified Party but shall retain the right to control the overall Proceedings out of which the claim arose, and counsel employed by the Indemnified Party shall be at the expense of the Indemnifying Party). The Indemnifying Party shall not be liable for any settlement of any such Proceeding effected without its written consent, which consent shall not be unreasonably withheld. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending Proceeding in respect of which any Indemnified Party is a party, unless such settlement includes an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such Proceeding.

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All fees and expenses of the Indemnified Party to which the Indemnified Party is entitled hereunder (including reasonable fees and expenses to the extent incurred in connection with investigating or preparing to defend such Proceeding in a manner not inconsistent with this Section) shall be paid to the Indemnified Party, as incurred, within ten (10) Business Days after the Indemnified Party gives written notice thereof to the Indemnifying Party.

(d)Contribution. If a claim for indemnification under Section 6(a) or ~±i2) of this Agreement is unavailable to an Indemnified Party or is insufficient to hold such Indemnified Party harmless for any Losses in respect of which this Section would apply by its terms (other than by reason of exceptions provided in this Section), then each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such Losses, (i) in such proportion as is appropriate to reflect the relative benefits received by the Indemnifying Party on the one hand and the Indemnified Party on the other from the distribution of the Registrable Securities or (ii) if the allocation provided by clause (i) above in this paragraph is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in such clause (i) but also the relative fault of the Indemnifying Party and Indemnified Party in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party and Indemnified Party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission of a material fact, has been taken or made by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such action, statement or omission. The amount paid or payable by a party as a result of any Losses shall be deemed to include, subject to the limitations set forth in Section 6(c) hereof any attorneys’ or other fees or expenses incurred by such party in connection with any Proceeding to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in this Section was available to such party.

The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 6(d) were determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 6(d), no Holder shall be required to contribute, in the aggregate, any amount in excess of the amount by which the proceeds actually received by such Holder from the sale of its Registrable Securities subject to the Proceeding exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.

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(e)The indemnity and contribution agreements contained in this Section 6 and the representations and warranties of the Company set forth in this Agreement shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Holder or any Person controlling Holder, the Company, its directors or officers or any Person controlling the Company.

(f)No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of any pending or threatened action, suit or proceeding in respect of which any Indemnified Party is or could have been a party and indemnity could have been sought hereunder by such Indemnified Party, unless such settlement includes an unconditional release of such Indemnified Party from all liability on claims that are the subject matter of such action, suit or proceeding.

(g)The indemnity and contribution agreements contained in this Section are in addition to any liability that the Indemnifying Parties may have to the Indemnified Parties.

7.Rule 144. The Company shall file the reports required to be filed by it under the Securities Act and the Exchange Act in a timely manner and, if at any time the Company is not required to file such reports, it will, upon the request of any Holder, make publicly available other information for as long as necessary to permit sales of its securities pursuant to Rule 144. The Company further covenants that it will take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144. Upon the request of any Holder, the Company shall deliver to such Holder a written certification of a duly authorized officer as to whether it has complied with such requirements.

8.Rule 144A. The Company agrees that, upon the request of a Holder or any prospective purchaser of Registrable Securities designated by a Holder, the Company shall promptly provide (but in any case within fifteen (15) days of a request) to such Holder or potential purchaser, the following information:

(a)a brief statement of the nature of the business of the Company and any subsidiaries and the products and services each of them offers;

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(b)the most recent consolidated balance sheets and profit and losses and retained earnings statements, and similar financial statements of the Company for the two (2) most recent fiscal years (such financial information shall be audited, to the extent reasonably available); and

(c)such other information about the Company, any subsidiaries, and their business, financial condition and results of operations as such Holder or purchaser of such Registrable Securities shall request in order to comply with Rule 144A, as amended, and in connection therewith the anti-fraud provisions of the federal and state securities laws.

The Company hereby represents and warrants to the Holders and any prospective purchaser of Registrable Securities from a Holder that the information provided by the Company pursuant to this Section 8 will, as of the dates of such information, not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.

9.Consent to be Bound; Assignability of Registration Rights. Each subsequent holder of Registrable Securities must consent in writing to be bound by the terms and conditions of this Agreement in order to acquire the rights granted pursuant to this Agreement. Subject to the foregoing sentence, the registration rights set forth in this Agreement are assignable to each assignee of Registrable Securities conveyed in accordance herewith who agrees in writing to be bound by the terms and conditions of this Agreement.

10.Miscellaneous.

(a)No amendment, modification, termination or cancellation of this Agreement shall be effective unless made in a writing signed by the Company and all of the Persons who are then Holders of Registrable Securities;

(b)The Company and the Holders agree that the rights created by this Agreement are unique, and that the loss of any such right is not susceptible to monetary quantification. Consequently, the parties agree that an action for specific performance (including for temporary and/or permanent injunctive relief) of the obligations created by this Agreement is a proper remedy for the breach of the provisions of this Agreement, without the necessity of proving actual damages. If the parties hereto are forced to institute legal proceedings to enforce their rights in accordance with the provisions of this Agreement, the prevailing party shall be entitled to recover its reasonable expenses, including attorneys’ fees, in connection with any such action;

(c)Except as otherwise specifically provided herein, all notices, requests, demands and other communications provided for hereunder shall be in writing and shall be deemed duly given to the Person for whom intended (i) upon receipt when personally delivered, (ii) one (1) day after being sent by a nationally recognized overnight courier for next day delivery or telecopy providing confirmation or receipt of delivery, or (iii) three (3) days after being sent by certified or registered mail, postage and certified or registered mail fees prepaid, return receipt requested, if sent to such Person at the address for such Person indicated below or to such other address as may be designated by such Person in writing sent by such Person in the manner required by this Section:

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If to the Company:	Market Central, Inc. 1650A Gum Branch Road Jacksonville, NC 28540 Attn: CEO Tel: Fax:
With copies to:	Greenberg Traurig LLP Suite 400 3290 Northside Parkway Atlanta, GA 30327 Attn: Gerald L. Baxter, Esq. Tel: (678) 553-2430 Fax: (678) 553-2431
	Gottbetter & Partners, LLP 488 Madison Avenue New York, NY 10022 Attn: Adam S. Gottbetter, Esq. Tel: (212) 400-6900 Fax: (212) 400-6901
If to the Holders:	To the address of each such Holder as it appears in the stock transfer records of the Company
With copies to:	Gottbetter & Partners, LLP 488 Madison Avenue New York, NY 10022 Attn: Adam S. Gottbetter, Esq. Tel: (212) 400-6900 Fax: (212) 400-6901

(d)This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and, all of which taken together shall constitute one and the same Agreement. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such facsimile signature were the original thereof

(e)This Agreement shall be governed by and construed in accordance with the laws of the state of New York without regard to principles thereof relating to the conflict of laws. Each of the Company and each Holder hereby irrevocably submits to the jurisdiction of any New York state court or any federal court sitting in the city and county of New York (collectively, the “New York Courts”) in respect of any Proceeding arising out of or relating to this Agreement and irrevocably accepts for itself and in respect of its property, generally and unconditionally, jurisdiction of the New York Courts. Each of the Company and each Holder irrevocably waives, to the fullest extent it may effectively do so under applicable law, any objection that it may now or hereafter have to the laying of the venue of any such Proceeding brought in any New York Court and any claim that any such Proceeding brought in any New York Court has been brought in an inconvenient forum;

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(f)The remedies provided herein are cumulative and not exclusive of one another or of any remedies provided by law;

(g)If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

(h)The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(i)This Agreement shall terminate when all of the Registrable Securities held by all of the Selling Holders are eligible for immediate sale pursuant to the provisions of Rule 144.

[Signatures on following page]

16

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

Company:
MARKET CENTRAL, INC.
By:
	Name:
	Title

Purchaser:
DUNGARVON ASSOCIATES, INC. ON BEHALF OF ARMADILLO INVESTMENTS, PLC.
By:
	Name:
	Title

EX-4.6

Exhibit 4.6

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE HOLDER SHOULD BE AWARE THAT IT MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

2005 6.4% SENIOR CONVERTIBLE NOTE

${______}.00 _______________, 2005

Subject to the terms and conditions of this 2005 6.4% Senior Convertible Note (“Note”), for good and valuable consideration received, Market Central, Inc. d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), promises to pay to the order of {_____________} (“Holder”) the principal amount of ${__________}.00, plus simple interest, accrued on unpaid principal from the date of this Note until paid at the rate of 6.4% per annum (360-day year basis) (the “Principal Amount”).

The following is a statement of the rights of the Holder of this Note and the terms and conditions to which this Note is subject, and to which the Holder, hereof, by the acceptance of this Note, agrees:

Payment Obligation. The principal and accrued but unpaid interest under this Note will be paid to the Holder on May 31, 2007 (the “Maturity Date”), unless previously paid or converted into securities of the Company in accordance with Section 2 hereof. All payments of principal and/or interest under this Note will be made at the address set forth below or by mail to the address of record of the Holder. All cash payments hereunder shall be made in lawful money of the United States of America, to the Holder, at such place and to such account as the Holder shall designate in a written notice to the Company. Accrued but unpaid interest shall be due and payable quarterly, commencing on May 31, 2005.

Prepayment. The principal amount of this Note may be prepaid by the Company at any time without penalty upon thirty (30) days prior written notice to the Holder.

Optional Conversion. Prior to the Maturity Date, the outstanding principal and interest outstanding under this Note may be converted at the option of the Holder into shares of Common Stock of the Company at a conversion rate one share per $1.3325 of the Principal Amount (the “Conversion Shares”). Such optional conversion may be for the whole or any part of the Principal Amount of this Note.

Assignment. The rights and obligations of the Company and the Holder will be binding upon and inure to the benefit of the successors, assigns, heirs, administrators and transferees of the parties.

Waiver and Amendment. Any provision of this Note may be amended, waived or modified upon the written consent of the Company and the Holder.

Notices. Any notice, request or other communication required or permitted hereunder will be in writing and shall be deemed to have been duly given if personally delivered or if telegraphed or mailed by registered or certified mail, postage prepaid, at the respective addresses of the parties as set forth below. Any party hereto may by notice so given change its address for future notice hereunder. Notice will conclusively be deemed to have been given when personally delivered or when deposited in the mail or telegraphed in the manner set forth above and will be deemed to have been received when delivered. Prior to the maturity of this Note, the Company (i) fixes a record date for purposes of determining the Holders of any class or series of securities who are entitled to receive any dividend or other distribution, or (ii) fixes a closing date for the issuance of any equity securities of the Company, the Company will mail to the Holder, at least fifteen (15) days prior to such date a notice specifying such record date or closing date and the matter pursuant to which such record date or closing date has been set. Prior to the payment of any Principal Amount, the Company shall provide the Holder with thirty (30) days prior written notice, stating that the Holder may convert the Note into Common Stock of the Company prior to payment.

Rights as a Stockholder. This Note, as such, shall not entitle the Holder to any rights as a stockholder of the Company, except as otherwise specified herein.

Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, excluding that body of law relating to conflict of laws.

Severability. If one or more provisions of this Note are held to be unenforceable under applicable law, such provision shall be excluded from this Note and the balance of the Note shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

Time of the Essence. Time is of the essence of this Note.

Costs of Enforcement; Presentment. The Company agrees to pay on demand all of the losses, costs, and expenses (including, without limitation, all reasonable attorneys’ fees and disbursements) which the Holder incurs in connection with enforcement of this Note, or the protection or preservation of the Holder’s rights under this Note, whether by judicial proceeding or otherwise. Such costs and expenses include, without limitation, those incurred in connection with any workout or refinancing, or any bankruptcy, insolvency, liquidation or similar proceedings. The Company hereby waives diligence, demand, presentment, protest or notice of any kind. The Company agrees to make all payments under this Note without setoff or deduction and regardless of any counterclaim or defense.

Headings; References. All headings used herein are used for convenience only and will not be used to construe or interpret this Note. Except where otherwise indicated, all references herein to Sections refer to Sections hereof.

Previous Agreements Superceded. This Note shall supercede all previous agreements made on or prior to the date hereof between the Holder and the Company with respect to the subject matter hereof.

IN WITNESS WHEREOF, the parties have caused this Convertible Note to be issued as of _____________, 2005.

THE COMPANY:

Market Central, Inc. d/b/a Scientigo, Inc.

By: ________________________

Name: ______________________

Title: _______________________

Address:

Suite 300

7810 Ballantyne Commons Parkway

Charlotte, NC 28277

HOLDER:

By: ______________________

Address:

_________________________

_________________________

_________________________

EX-4.7

EXHIBIT 4.7

8% A NOTE

${______}.00 ________, 200_

Subject to the terms and conditions of this 8% A Note (“Note”), for good and valuable consideration received, Market Central, Inc. d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), promises to pay to the order of {_____________} (“Holder”) the principal amount of ${__________}.00 (the “Principal Amount”), plus simple interest, accrued on unpaid principal from the date of this Note until paid at the rate of 8.0% per annum (360-day year basis).

The following is a statement of the rights of the Holder of this Note and the terms and conditions to which this Note is subject, and to which the Holder, hereof, by the acceptance of this Note, agrees:

Payment Obligation. The principal and accrued but unpaid interest under this Note will be paid to the Holder on May 31, 2007 (the “Maturity Date”), unless previously paid or converted into securities of the Company in accordance with the “Optional Conversion” section hereof. All payments of principal and/or interest under this Note will be made at the address set forth below or by mail to the address of record of the Holder. All cash payments hereunder shall be made in lawful money of the United States of America, to the Holder, at such place and to such account as the Holder shall designate in a written notice to the Company. Accrued but unpaid interest shall be due and payable quarterly, commencing on the earlier of the first February 28, May 31, August 31 or November 30 following the date hereof.

Prepayment. The principal amount of this Note may be prepaid by the Company at any time without penalty upon thirty (30) days prior written notice to the Holder.

Optional Conversion. On or prior to ______________, 2006 (the “Conversion Termination Date”), the Principal Amount outstanding under this Note may be converted at the option of the Holder into shares of Common Stock of the Company at a conversion rate of one share per $.96 of the Principal Amount (the “Conversion Shares”). Such optional conversion may be for the whole or any part of the Principal Amount of this Note. The Holder may exercise his conversion rights hereunder by delivering a conversion notice to the Company substantially in the form of Exhibit A hereto. After such Conversion Termination Date, the Principal Amount of this Note shall no longer be convertible into Conversion Shares.

Reorganization, Reclassification, Consolidation, Merger or Sale, etc.

(i)If the Company at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise) its class of outstanding shares of the Common Stock into a greater number of shares, the conversion rate in effect immediately prior to such subdivision will be proportionately reduced, and if the Company at any time combines (by reverse stock split or otherwise) one or more classes of its outstanding shares of its Common Stock, the conversion rate in effect immediately prior to such combination will be proportionately increased concurrently with the effectiveness of such event.

(ii)Any capital reorganization, reclassification, consolidation, merger or sale of all or substantially all of the Company’s assets to another person which is effected in such a way that holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock is referred to herein as an “Organic Change.” Prior to the consummation of any Organic Change, the Company will make appropriate provisions to insure that the Holder will thereafter have the right upon subsequent conversion of the Principal Amount to acquire and receive such shares of stock, securities or assets as such Holder would have received in connection with such Organic Change if such Holder had converted the Principal Amount hereof immediately prior to such Organic Change. The Company will not effect any such consolidation, merger or sale, unless prior to the consummation thereof, the successor Company (if other than the Company) resulting from consolidation or merger or the Company purchasing such assets assumes by written instrument the obligation to deliver to the Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such holder may be entitled to acquire.

Stock to be Reserved. The Company will at all times reserve and keep available out of its authorized Common Stock or its treasury shares, solely for the purpose of issue upon the conversion of the Principal Amount of the Note as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of then outstanding Principal Amount of this Note. The Company covenants that all shares of Common Stock which shall be so issued shall be duly and validly issued and fully paid and nonassessable and free from all liens and charges with respect to the issue thereof.

Assignment. The rights and obligations of the Company and the Holder will be binding upon and inure to the benefit of the successors, assigns, heirs, administrators and transferees of the parties.

Waiver and Amendment. Any provision of this Note may be amended, waived or modified upon the written consent of the Company and the Holder.

Notices. Any notice, request or other communication required or permitted hereunder will be in writing and shall be deemed to have been duly given if personally delivered or if telegraphed or mailed by registered or certified mail, postage prepaid, at the respective addresses of the parties as set forth below. Any party hereto may by notice so given change its address for future notice hereunder. Notice will conclusively be deemed to have been given when personally delivered or when deposited in the mail or telegraphed in the manner set forth above and will be deemed to have been received when delivered. Prior to the maturity of this Note, if the Company (i) fixes a record date for purposes of determining the Holders of any class or series of securities who are entitled to receive any dividend or other distribution, or (ii) fixes a closing date for the issuance of any equity securities of the Company, the Company will mail to the Holder, at least fifteen (15) days prior to such date a notice specifying such record date or closing date and the matter pursuant to which such record date or closing date has been set. Prior to the payment of any Principal Amount, the Company shall provide the Holder with thirty (30) days prior written notice, stating that the Holder may convert the Principal Amount of the Note into Conversion Shares prior to payment.

Rights as a Stockholder. This Note, as such, shall not entitle the Holder to any rights as a stockholder of the Company, except as otherwise specified herein.

Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, excluding that body of law relating to conflict of laws.

Severability. If one or more provisions of this Note are held to be unenforceable under applicable law, such provision shall be excluded from this Note and the balance of the Note shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

Time of the Essence. Time is of the essence of this Note.

Costs of Enforcement; Presentment. The Company agrees to pay on demand all of the losses, costs, and expenses (including, without limitation, all reasonable attorneys’ fees and disbursements) which the Holder incurs in connection with enforcement of this Note, or the protection or preservation of the Holder’s rights under this Note, whether by judicial proceeding or otherwise. Such costs and expenses include, without limitation, those incurred in connection with any workout or refinancing, or any bankruptcy, insolvency, liquidation or similar proceedings. The Company hereby waives diligence, demand, presentment, protest or notice of any kind. The Company agrees to make all payments under this Note without setoff or deduction and regardless of any counterclaim or defense.

Headings; References. All headings used herein are used for convenience only and will not be used to construe or interpret this Note. Except where otherwise indicated, all references herein to Sections refer to Sections hereof.

Previous Agreements Superceded. This Note shall supercede all previous agreements made on or prior to the date hereof between the Holder and the Company with respect to the subject matter hereof.

IN WITNESS WHEREOF, the parties have caused this Note to be issued as of _____________, 200_.

THE COMPANY:

Market Central, Inc. d/b/a Scientigo, Inc.

By:________________________________________

Name:______________________________________

Title:_______________________________________

Address:

Suite 205

6701 Carmel Road

Charlotte, NC 28226

HOLDER:

By:________________________________________

Address:

_________________________

_________________________

_________________________

EXHIBIT A

Scientigo, Inc.

6701 Carmel Road

Suite 205

Charlotte, NC 28266

Atten: Chief Financial Officer

CONVERSION NOTICE

SCIENTIGO 8% A NOTES

The undersigned is the owner of $______________ Principal Amount of Scientigo 8% A Notes (the “Note”), which original Note is enclosed with this Conversion Notice. In accordance with the terms of such Note, the undersigned hereby elects to convert $_____________ Principal Amount of the Note into shares of the Common Stock of Scientigo, Inc. Any remaining Principal Amount of the Note and the shares of Common Stock should be delivered to:

________________________________________

________________________________________

________________________________________

Name:________________________________________

Title:_________________________________________

Date:_________________________________________

EX-4.8

EXHIBIT 4.8

8% B NOTE

${______}.00 ________, 200_

Subject to the terms and conditions of this 8% B Note (“Note”), for good and valuable consideration received, Market Central, Inc. d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), promises to pay to the order of {_____________} (“Holder”) the principal amount of ${__________}.00 (the “Principal Amount”), plus simple interest, accrued on unpaid principal from the date of this Note until paid at the rate of 8.0% per annum (360-day year basis).

The following is a statement of the rights of the Holder of this Note and the terms and conditions to which this Note is subject, and to which the Holder, hereof, by the acceptance of this Note, agrees:

Payment Obligation. The principal and accrued but unpaid interest under this Note will be paid to the Holder on May 31, 2007 (the “Maturity Date”), unless previously paid or converted into securities of the Company in accordance with the “Optional Conversion” section hereof. All payments of principal and/or interest under this Note will be made at the address set forth below or by mail to the address of record of the Holder. All cash payments hereunder shall be made in lawful money of the United States of America, to the Holder, at such place and to such account as the Holder shall designate in a written notice to the Company. Accrued but unpaid interest shall be due and payable quarterly, commencing on the earlier of the first February 28, May 31, August 31 or November 30 following the date hereof.

Prepayment. The principal amount of this Note may be prepaid by the Company at any time without penalty upon thirty (30) days prior written notice to the Holder; provided that if such written notice is provided at anytime that the Principal Amount may not be converted into Conversion Shares as set forth in the “Optional Conversion” section hereof, such prepayment shall be permissible only with the prior written consent of the holder hereof.

Optional Conversion. Beginning _____________, 200_, and ending on the Maturity Date, the Principal Amount outstanding under this Note may be converted at the option of the Holder into shares of Common Stock of the Company at a conversion rate of one share per $.96 of the Principal Amount (the “Conversion Shares”). Such optional conversion may be for the whole or any part of the Principal Amount of this Note. The Holder may exercise his conversion rights hereunder by delivering a conversion notice to the Company substantially in the form of Exhibit A hereto.

Reorganization, Reclassification, Consolidation, Merger or Sale, etc.

(i)If the Company at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise) its class of outstanding shares of the Common Stock into a greater number of shares, the conversion rate in effect immediately prior to such subdivision will be proportionately reduced, and if the Company at any time combines (by reverse stock split or otherwise) one or more classes of its outstanding shares of its Common Stock, the conversion rate in effect immediately prior to such combination will be proportionately increased concurrently with the effectiveness of such event.

(ii)Any capital reorganization, reclassification, consolidation, merger or sale of all or substantially all of the Company’s assets to another person which is effected in such a way that holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock is referred to herein as an “Organic Change.” Prior to the consummation of any Organic Change, the Company will make appropriate provisions to insure that the Holder will thereafter have the right upon subsequent conversion of the Principal Amount to acquire and receive such shares of stock, securities or assets as such Holder would have received in connection with such Organic Change if such Holder had converted the Principal Amount hereof immediately prior to such Organic Change. The Company will not effect any such consolidation, merger or sale, unless prior to the consummation thereof, the successor Company (if other than the Company) resulting from consolidation or merger or the Company purchasing such assets assumes by written instrument the obligation to deliver to the Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such holder may be entitled to acquire.

Stock to be Reserved. The Company will at all times reserve and keep available out of its authorized Common Stock or its treasury shares, solely for the purpose of issue upon the conversion of the Principal Amount of the Note as herein provided, such number of shares of Common Stock as shall then be issuable upon the conversion of then outstanding Principal Amount of this Note. The Company covenants that all shares of Common Stock which shall be so issued shall be duly and validly issued and fully paid and nonassessable and free from all liens and charges with respect to the issue thereof.

Assignment. The rights and obligations of the Company and the Holder will be binding upon and inure to the benefit of the successors, assigns, heirs, administrators and transferees of the parties.

Transfer and Assignment Restrictions. This Note shall not be transferable or otherwise assignable unless such transferee or assignee is an “accredited investor” as defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended. Prior to any proposed transfer or assignment, the Holder shall provide the Company with reasonable evidence of the accredited investor status of such transferee or assignee. Any purported transfer or assignment of the Note which does not comply with the terms of this provisions shall be null and void and of no legal effect.

Waiver and Amendment. Any provision of this Note may be amended, waived or modified upon the written consent of the Company and the Holder.

Notices. Any notice, request or other communication required or permitted hereunder will be in writing and shall be deemed to have been duly given if personally delivered or if telegraphed or mailed by registered or certified mail, postage prepaid, at the respective addresses of the parties as set forth below. Any party hereto may by notice so given change its address for future notice hereunder. Notice will conclusively be deemed to have been given when personally delivered or when deposited in the mail or telegraphed in the manner set forth above and will be deemed to have been received when delivered. Prior to the maturity of this Note, if the Company (i) fixes a record date for purposes of determining the Holders of any class or series of securities who are entitled to receive any dividend or other distribution, or (ii) fixes a closing date for the issuance of any equity securities of the Company, the Company will mail to the Holder, at least fifteen (15) days prior to such date a notice specifying such record date or closing date and the matter pursuant to which such record date or closing date has been set. Prior to the payment of any Principal Amount, the Company shall provide the Holder with thirty (30) days prior written notice, stating that the Holder may convert the Principal Amount of the Note into Conversion Shares prior to payment.

Rights as a Stockholder. This Note, as such, shall not entitle the Holder to any rights as a stockholder of the Company, except as otherwise specified herein.

Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, excluding that body of law relating to conflict of laws.

Severability. If one or more provisions of this Note are held to be unenforceable under applicable law, such provision shall be excluded from this Note and the balance of the Note shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

Time of the Essence. Time is of the essence of this Note.

Costs of Enforcement; Presentment. The Company agrees to pay on demand all of the losses, costs, and expenses (including, without limitation, all reasonable attorneys’ fees and disbursements) which the Holder incurs in connection with enforcement of this Note, or the protection or preservation of the Holder’s rights under this Note, whether by judicial proceeding or otherwise. Such costs and expenses include, without limitation, those incurred in connection with any workout or refinancing, or any bankruptcy, insolvency, liquidation or similar proceedings. The Company hereby waives diligence, demand, presentment, protest or notice of any kind. The Company agrees to make all payments under this Note without setoff or deduction and regardless of any counterclaim or defense.

Headings; References. All headings used herein are used for convenience only and will not be used to construe or interpret this Note. Except where otherwise indicated, all references herein to Sections refer to Sections hereof.

Previous Agreements Superceded. This Note shall supercede all previous agreements made on or prior to the date hereof between the Holder and the Company with respect to the subject matter hereof.

IN WITNESS WHEREOF, the parties have caused this Note to be issued as of _____________, 200_.

THE COMPANY:

Market Central, Inc. d/b/a Scientigo, Inc.

By:__________________________________________

Name:________________________________________

Title:_________________________________________

Address:

Suite 205

6701 Carmel Road

Charlotte, NC 28226

HOLDER:

By:__________________________________________

Address:

_________________________

_________________________

_________________________

EXHIBIT A

Scientigo, Inc.

6701 Carmel Road

Suite 205

Charlotte, NC 28266

Atten: Chief Financial Officer

CONVERSION NOTICE

SCIENTIGO 8% B NOTES

The undersigned is the owner of $______________ Principal Amount of Scientigo 8% B Notes (the “Note”), which original Note is enclosed with this Conversion Notice. In accordance with the terms of such Note, the undersigned hereby elects to convert $_____________ Principal Amount of the Note into shares of the Common Stock of Scientigo, Inc. Any remaining Principal Amount of the Note and the shares of Common Stock should be delivered to:

__________________________________________

__________________________________________

__________________________________________

Name:__________________________________________

Title:___________________________________________

Date:___________________________________________

EX-4.9

Exhibit 4.9

SECURITY AGREEMENT

THIS SECURITY AGREEMENT (this “Agreement”), dated as of September 30, 2005, is made by Market Central, Inc. dba Scientigo, Inc., a Delaware corporation (the "Company"), for the benefit of the secured parties signatory hereto pursuant to powers of attorney granted to CrossHill Georgetown Capital, LP, a Delaware limited partnership (“CrossHill”) and their respective endorsees, transferees and assigns, all as set forth on Exhibit A attached hereto and made a part hereof, as amended from time to time (collectively, the "Secured Party").

W I T N E S S E T H:

WHEREAS, the Company has completed an offering (the “Offering”) and has issued Six Million Six Hundred Thirty Three Thousand Nine Hundred Fifty Dollars ($6,633,950.00) Principal Amount of Scientigo 2005 6.4% Senior Convertible Notes (the “Senior Notes”) and Warrants (the “Warrants”) to purchase the common stock, $0.001 par value per share, of the Company (the “Common Stock”), which Offering was authorized by the Board of Directors of the Company;

WHEREAS, the terms of the Company’s Offering provide that the repayment of the Senior Notes is to be secured by the grant by the Company to the Secured Party of a first lien priority security interest in and to all of the intellectual property assets of the Company;

WHEREAS, pursuant to a Subscription Agreement between the Company and each person or entity comprising the Secured Party (the “Purchase Agreement”), the Company has issued to the Secured Party the Senior Notes and the Warrants; and

WHEREAS, in order to induce the Secured Party to purchase the Senior Notes, the Company has agreed to execute and deliver to the Secured Party this Agreement for the benefit of the Secured Party and to grant to it a security interest in certain property of the Company to secure the prompt payment, performance and discharge in full of all of the Company’s obligations under the Senior Notes; and

WHEREAS, CrossHill has been authorized and has agreed to act as the duly authorized agent of the Secured Parties.

NOW, THEREFORE, in consideration of the agreements herein contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

1.Certain Definitions. As used in this Agreement, the following terms shall have the meanings set forth in this Section 1. Terms used but not otherwise defined in this Agreement that are defined in Article 9 of the UCC (such as “general intangibles” and “proceeds”) shall have the respective meanings given such terms in Article 9 of the UCC.

(a)“Collateral” means the collateral in which the Secured Party is granted a security interest by this Agreement and which shall include the following, whether presently owned or existing or hereafter acquired or coming into existence, and all additions and accessions thereto and all substitutions and replacements thereof, and all proceeds, products and accounts thereof, including, without limitation, all proceeds from the sale or transfer of the Collateral and of insurance covering the same and of any tort claims in connection therewith:

(i)All Intellectual Property Rights owned or licensed by the Company. For purposes hereof, “Intellectual Property Rights” means: (a) all inventions (whether patentable or unpatentable and whether or not reduced to practice), patents, patent applications, and patent disclosures, together with all reissuances, continuations, continuations-in-part, revisions, extensions, and re-examinations thereof, (b) any trademarks, service marks, trade dress, logos, trade names, domain names and corporate names, together with all translations, adaptations, derivations, and combinations thereof and including all goodwill associated therewith, the business associated therewith, which business is ongoing, and all applications, registrations and renewals, (c) copyrightable and copyrighted works, all copyrights, and all applications, registrations, and renewals in connection therewith, (d) trade secrets and confidential business information (including ideas, research and development, know-how, formulas, compositions, manufacturing and production processes and techniques, designs, drawings, specifications, technical data, customer and supplier lists, pricing and cost information, and business and marketing plans and proposals) in connection therewith, (e) computer software in connection therewith, (f) database rights in connection therewith, (g) design rights and registered designs and all documentation and media constituting or describing any of the foregoing and all copies and tangible embodiments thereof (in whatever form or medium and whether or not any of the foregoing is registered) in connection therewith, and (h) any other proprietary rights associated with the Intellectual Property, including all options to make, use and sell and any moral rights, pertaining to any product or service designed, manufactured, sold, distributed, marketed, used, performed, employed or exploited, and all rights or forms of protection of a similar nature or having equivalent or similar effect to any of those which may subsist anywhere in the world;

(ii)$5,000,000 in cash (the “Cash Collateral”) which may be substituted for certain of the Collateral as set forth in Section 11 hereof ; and

(iii)The products and proceeds of all of the foregoing Collateral set forth in clauses (i) and (ii) above.

(b)“Company” shall mean, collectively, Company and all of the subsidiaries of Company, a list of which is contained in Schedule A, attached hereto.

(c)“Obligations” means all of the Company’s obligations under this Agreement and the Senior Notes, in each case, whether now or hereafter existing, voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated, whether or not jointly owed with others, and whether or not from time to time decreased or extinguished and later decreased, created or incurred, and all or any portion of such obligations or liabilities that are paid, to the extent all or any part of such payment is avoided or recovered directly or indirectly from the Secured Party as a preference, fraudulent transfer or otherwise as such obligations may be amended, supplemented, converted, extended or modified from time to time.

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(d)“UCC” means the Uniform Commercial Code, as currently in effect in the State of Georgia.

(e)“XML Patents” means those certain patents owned by the Company as described on Schedule B, attached hereto.

2.Grant of Security Interest. As an inducement for the Secured Party to purchase the Senior Notes and to secure the complete and timely payment, performance and discharge in full, as the case may be, of all of the Obligations, the Company hereby, unconditionally and irrevocably, pledges, grants and hypothecates to the Secured Party, a continuing security interest in, a continuing lien upon, an unqualified right to possession and disposition of and a right of set-off against, in each case to the fullest extent permitted by law, all of the Company's right, title and interest of whatsoever kind and nature in and to the Collateral (the "Security Interest").

3.Representations, Warranties, Covenants and Agreements of the Company. The Company represents and warrants to, and covenants and agrees with, the Secured Party as follows:

(a)The Company has the requisite corporate power and authority to enter into this Agreement and otherwise to carry out its obligations thereunder. The execution, delivery and performance by the Company of this Agreement and the filings contemplated therein have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company. This Agreement constitutes a legal, valid and binding obligation of the Company enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creidtor’s rights generally.

(b)The Company represents and warrants that it has no place of business or offices where its respective books of account and records are kept (other than temporarily at the offices of its attorneys or accountants) or places where Collateral is stored or located, except as set forth on Schedule A attached hereto;

(c)The Company is the sole owner of the Collateral (except for non-exclusive licenses granted by the Company in the ordinary course of business), free and clear of any liens, security interests, encumbrances, rights or claims, except as set forth on Schedule 3(c), and is fully authorized to grant the Security Interest in and to pledge the Collateral. There is not on file in any governmental or regulatory authority, agency or recording office an effective financing statement, security agreement, license or transfer or any notice of any of the foregoing (other than those that have been filed in favor of the Secured Party pursuant to this Agreement) covering or affecting any of the Collateral. So long as this Agreement shall be in effect, the Company shall not execute and shall not knowingly permit to be on file in any such office or agency any such financing statement or other document or instrument (except to the extent filed or recorded in favor of the Secured Party pursuant to the terms of this Agreement).

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(d)No part of the Collateral has been judged invalid or unenforceable. No written claim has been received that any Collateral or the Company’s use of any Collateral violates the rights of any third party. There has been no adverse decision to the Company’s claim of ownership rights in or exclusive rights to use the Collateral in any jurisdiction or to the Company's right to keep and maintain such Collateral in full force and effect, and there is no proceeding involving said rights pending or, to the best knowledge of the Company, threatened before any court, judicial body, administrative or regulatory agency, arbitrator or other governmental authority.

(e)The Company shall at all times maintain its books of account and records relating to the Collateral at its principal place of business and its Collateral at the locations set forth on Schedule A attached hereto and may not relocate such books of account and records or tangible Collateral unless it delivers to the Secured Party at least 30 days prior to such relocation (i) written notice of such relocation and the new location thereof (which must be within the United States) and (ii) evidence that appropriate financing statements and other necessary documents have been filed and recorded and other steps have been taken to perfect the Security Interest to create in favor of the Secured Party valid, perfected and continuing liens in the Collateral.

(f)This Agreement creates in favor of the Secured Party a valid security interest in the Collateral securing the payment and performance of the Obligations and, upon making the filings described in the immediately following sentence, a perfected security interest in such Collateral. Except for the filing of financing statements on Form-1 under the UCC with the jurisdictions indicated on Schedule Cattached heretoand the filing of appropriate assignment forms with the US Patent and Trademark Office “USPTO”), no authorization or approval of or filing with or notice to any governmental authority or regulatory body is required either (i) for the grant by the Company of, or the effectiveness of, the Security Interest granted hereby or for the execution, delivery and performance of this Agreement by the Company or (ii) for the perfection of or exercise by the Secured Party of its rights and remedies hereunder.

(g)On the date of execution of this Agreement, the Company will deliver to the Secured Party (a) one or more executed UCC financing statements on Form-UCC1 with respect to the Security Interest for filing with the jurisdictions indicated on Schedule C, attached hereto and in such other jurisdictions as may be requested by the Secured Party, and (b) one or more executed USPTO assignment forms for filing with the USPTO.

(h)The execution, delivery and performance of this Agreement does not conflict with or cause a breach or default, or an event that with or without the passage of time or notice, shall constitute a breach or default, under any agreement to which the Company is a party or by which the Company is bound. No consent (including, without limitation, from stock holders or creditors of the Company) is required for the Company to enter into and perform its obligations hereunder.

(i)The Company shall at all times maintain the liens and Security Interest provided for hereunder as valid and perfected liens and security interests in the Collateral in favor of the Secured Party until this Agreement and the Security Interest hereunder shall terminate pursuant to Section 11. The Company hereby agrees to defend the same against any and all persons. The Company shall safeguard and protect all Collateral for the account of the Secured Party. At the request of the Secured Party, the Company will sign and deliver to the Secured Party at any time or from time to time one or more financing statements pursuant to the UCC (or any other applicable statute) in form reasonably satisfactory to the Secured Party and will pay the cost of filing the same in all public offices wherever filing is, or is deemed by the Secured Party to be, necessary or desirable to effect the rights and obligations provided for herein. Without limiting the generality of the foregoing, the Company shall pay all fees, taxes and other amounts necessary to maintain the Collateral and the Security Interest hereunder, and the Company shall obtain and furnish to the Secured Party from time to time, upon demand, such releases and/or subordinations of claims and liens which may be required to maintain the priority of the Security Interest hereunder.

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(j)The Company will not transfer, pledge, hypothecate, encumber, license (except for non-exclusive licenses granted by the Company in the ordinary course of business), sell or otherwise dispose of any of the Collateral without the prior written consent of the Secured Party.

(k)The Company shall, within ten (10) days of obtaining knowledge thereof, advise the Secured Party promptly, in sufficient detail, of any substantial change in the Collateral, and of the occurrence of any event which would have a material adverse effect on the value of the Collateral or on the Secured Party's security interest therein.

(l)The Company shall promptly execute and deliver to the Secured Party such further deeds, mortgages, assignments, security agreements, financing statements or other instruments, documents, certificates and assurances and take such further action as the Secured Party may from time to time request and may in its sole discretion deem necessary to perfect, protect or enforce its security interest in the Collateral.

(m)The Company shall permit the Secured Party and its representatives and agents to inspect the Collateral at any time, and to make copies of records pertaining to the Collateral as may be requested by the Secured Party from time to time.

(n)The Company will take all steps reasonably necessary to diligently pursue and seek to preserve, enforce and collect any rights, claims, causes of action and accounts receivable in respect of the Collateral.

(o)The Company shall promptly notify the Secured Party in sufficient detail upon becoming aware of any attachment, garnishment, execution or other legal process levied against any Collateral and of any other information received by the Company that may materially affect the value of the Collateral, the Security Interest or the rights and remedies of the Secured Party hereunder.

(p)All information heretofore, herein or hereafter supplied to the Secured Party by or on behalf of the Company with respect to the Collateral is accurate and complete in all material respects as of the date furnished.

(q)Schedule A attached hereto contains a list of all of the subsidiaries of Company.

4.Defaults. The following events shall be "Events of Default":

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(a)The failure of the Company to pay any amount due under the Senior Notes within five (5) days of the due date;

(b)Any representation or warranty of the Company in this Agreement shall prove to have been incorrect in any material respect when made; and

(c)The failure by the Company to observe or perform any of its obligations hereunder for thirty (30) days after receipt by the Company of notice of such failure from the Secured Party; and

5.Duty To Hold In Trust. Upon the occurrence of any Event of Default and at any time thereafter, the Company shall, upon receipt by it of any revenue, income or other sums subject to the Security Interest, whether payable pursuant to the Senior Notes or otherwise, or of any check, draft, note, trade acceptance or other instrument evidencing an obligation to pay any such sum, hold the same in trust for the Secured Party and shall forthwith endorse and transfer any such sums or instruments, or both, to the Secured Party for application to the satisfaction of the Obligations.

6.Rights and Remedies Upon Default. Upon occurrence of any Event of Default and at any time thereafter, then CrossHill, as duly authorized attorney in fact for the Secured Parties, shall have the right to exercise all of the remedies conferred hereunder and under the Senior Notes, and the Secured Party shall have all the rights and remedies of a secured party under the UCC and/or any other applicable law (including the Uniform Commercial Code of any jurisdiction in which any Collateral is then located). Without limitation, the Secured Party shall have the following rights and powers:

(a)The Secured Party shall have the right to take possession of the Collateral and, for that purpose, enter, with the aid and assistance of any person, any premises where the Collateral, or any part thereof, is or may be placed and remove the same, and the Company shall assemble the Collateral and make it available to the Secured Party at places which the Secured Party shall reasonably select, whether at the Company's premises or elsewhere, and make available to the Secured Party, without rent, all of the Company’s respective premises and facilities for the purpose of the Secured Party taking possession of, removing or putting the Collateral in saleable or disposable form.

(b)The Secured Party shall have the right to operate the business of the Company using the Collateral and shall have the right to assign, sell, lease or otherwise dispose of and deliver all or any part of the Collateral, at public or private sale or otherwise, either with or without special conditions or stipulations, for cash or on credit or for future delivery, in such parcel or parcels and at such time or times and at such place or places, and upon such terms and conditions as the Secured Party may deem commercially reasonable, all without (except as shall be required by applicable statute and cannot be waived) advertisement or demand upon or notice to the Company or right of redemption of the Company, which are hereby expressly waived. Upon each such sale, lease, assignment or other transfer of Collateral, the Secured Party may, unless prohibited by applicable law which cannot be waived, purchase all or any part of the Collateral being sold, free from and discharged of all trusts, claims, right of redemption and equities of the Company, which are hereby waived and released.

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7.Applications of Proceeds. The proceeds of any such sale, lease or other disposition of the Collateral hereunder shall be applied first, to the expenses of retaking, holding, storing, processing and preparing for sale, selling, and the like (including, without limitation, any taxes, fees and other costs incurred in connection therewith) of the Collateral, to the reasonable attorneys' fees and expenses incurred by the Secured Party in enforcing its rights hereunder and in connection with collecting, storing and disposing of the Collateral, and then to satisfaction of the Obligations, and to the payment of any other amounts required by applicable law, after which the Secured Party shall pay to the Company any surplus proceeds. If, upon the sale, license or other disposition of the Collateral, the proceeds thereof are insufficient to pay all amounts to which the Secured Party is legally entitled, the Company will be liable for the deficiency, together with interest thereon, at the rate of fifteen percent (15%) per annum (the "Default Rate"), and the reasonable fees of any attorneys employed by the Secured Party to collect such deficiency. To the extent permitted by applicable law, the Company waives all claims, damages and demands against the Secured Party arising out of the repossession, removal, retention or sale of the Collateral, unless due to the gross negligence or willful misconduct of the Secured Party.

8.Costs and Expenses. The Company agrees to pay all out-of-pocket fees, costs and expenses incurred in connection with any filing required hereunder, including without limitation, any financing statements, continuation statements, partial releases and/or termination statements related thereto or any expenses of any searches reasonably required by the Secured Party. The Company shall also pay all other claims and charges which in the reasonable opinion of the Secured Party might prejudice, imperil or otherwise affect the Collateral or the Security Interest therein. The Company will also, upon demand, pay to the Secured Party the amount of any and all reasonable expenses, including the reasonable fees and expenses of its counsel and of any experts and agents, which the Secured Party may incur in connection with (i) the enforcement of this Agreement, (ii) the custody or preservation of, or the sale of, collection from, or other realization upon, any of the Collateral, or (iii) the exercise or enforcement of any of the rights of the Secured Party under the Senior Notes. Until so paid, any fees payable hereunder shall be added to the principal amount of the Senior Notes and shall bear interest at the Default Rate.

9.Responsibility for Collateral. The Company assumes all liabilities and responsibility in connection with all Collateral, and the obligations of the Company hereunder or under the Senior Notes and the Warrants shall in no way be affected or diminished by reason of the loss, destruction, damage or theft of any of the Collateral or its unavailability for any reason.

10.Security Interest Absolute. All rights of the Secured Party and all Obligations of the Company hereunder, shall be absolute and unconditional, irrespective of: (a) any lack of validity or enforceability of this Agreement, the Senior Notes, the Warrants or any agreement entered into in connection with the foregoing, or any portion hereof or thereof; (b) any change in the time, manner or place of payment or performance of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any departure from the Senior Notes, the Warrants or any other agreement entered into in connection with the foregoing; (c) any exchange, release or nonperfection of any of the Collateral, or any release or amendment or waiver of or consent to departure from any other collateral for, or any guaranty, or any other security, for all or any of the Obligations; (d) any action by the Secured Party to obtain, adjust, settle and cancel in its sole discretion any insurance claims or matters made or arising in connection with the Collateral; or (e) any other circumstance which might otherwise constitute any legal or equitable defense available to the Company, or a discharge of all or any part of the Security Interest granted hereby. Until this Agreement is terminated in accordance with Section 11 herein, the rights of the Secured Party shall continue even if the Obligations are barred for any reason, including, without limitation, the running of the statute of limitations or bankruptcy. The Company expressly waives presentment, protest, notice of protest, demand, notice of nonpayment and demand for performance. In the event that at any time any transfer of any Collateral or any payment received by the Secured Party hereunder shall be deemed by final order of a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under the bankruptcy or insolvency laws of the United States, or shall be deemed to be otherwise due to any party other than the Secured Party, then, in any such event, the Company's obligations hereunder shall survive cancellation of this Agreement, and shall not be discharged or satisfied by any prior payment thereof and/or cancellation of this Agreement, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof. The Company waives all right to require the Secured Party to proceed against any other person or to apply any Collateral which the Secured Party may hold at any time, or to marshal assets, or to pursue any other remedy. The Company waives any defense arising by reason of the application of the statute of limitations to any obligation secured hereby.

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11.Term of Agreement; Substitution of Collateral; Partial Release of Collateral.

(a)This Agreement and the Security Interest shall terminate on the date on which the Principal Amount of the Senior Notes issued by the Company, together with all accrued but unpaid interest thereon, has been paid in full and/or converted into shares of Common Stock pursuant to the terms of the Senior Notes. Upon such termination, the Secured Party, at the request and at the expense of the Company, will join in executing any termination statement with respect to any financing statements and USPTO assignment forms executed and filed pursuant to this Agreement.

(b)This Agreement and the Security Interest shall terminate with respect to the XML Patents on the earlier of (i) the date on which the Cash Collateral has been deposited by the Company with CrossHill for the benefit of the Secured Party, or (ii) the date of which not less than $5,000,000 of the Principal Amount of the Senior Notes issued by the Company, together with all accrued but unpaid interest thereon, has been paid in full and/or converted into shares of Common Stock pursuant to the terms of the Senior Notes. Upon such termination, the Secured Party, at the request and at the expense of the Company, will join in executing any amendments, releases and/or termination statements with respect to any financing statements and USPTO assignment forms executed and filed pursuant to this Agreement required to release such XML Patents from the terms of this Agreement.

(c)If after substitution of the Cash Collateral for the XML Patents, the Company notifies CrossHill in writing of the conversion into shares of Common Stock and/or repayment of any or all of the Principal Amount of the Senior Notes, the Secured Party shall, after review of the evidence of such conversion and/or repayment, release a pro rata portion of such Cash Collateral being held to the Company based upon the portion of the Principal Amount of such Senior Notes so converted and/or repaid. This procedure shall not occur more often than once every thirty (30) day period.

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12.Power of Attorney; Further Assurances.

(a)The Company authorizes CrossHill, as the duly authorized agent of the Secured Parties, and does hereby make, constitute and appoint CrossHill, and its respective officers, agents, successors or assigns with full power of substitution, as the Company's true and lawful attorney-in-fact, with power, in its own name or in the name of the Company, to, after the occurrence and during the continuance of an Event of Default, (i) endorse any notes, checks, drafts, money orders, or other instruments of payment (including payments payable under or in respect of any policy of insurance) in respect of the Collateral that may come into possession of the Secured Party; (ii) to sign and endorse any UCC financing statement or any invoice, freight or express bill, bill of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications and notices in connection with accounts, and other documents relating to the Collateral; (iii) to pay or discharge taxes, liens, security interests or other encumbrances at any time levied or placed on or threatened against the Collateral; (iv) to demand, collect, receipt for, compromise, settle and sue for monies due in respect of the Collateral; and (v) generally, to do, and at the Company's expense, at any time, or from time to time, all acts and things which CrossHill deems necessary to protect, preserve and realize upon the Collateral and the Security Interest granted therein in order to effect the intent of this Agreement, the Senior Notes and the Warrants, all as fully and effectually as the Company might or could do; and the Company hereby ratifies all that said attorney shall lawfully do or cause to be done by virtue hereof. This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long as any of the Obligations shall be outstanding.

(b)On a continuing basis, the Company will make, execute, acknowledge, deliver, file and record, as the case may be, in the proper filing and recording places in any jurisdiction, including, without limitation, the jurisdictions indicated on Schedule C attached hereto, all such instruments, and take all such action as may reasonably be deemed necessary or advisable, or as reasonably requested by the Secured Party, to perfect the Security Interest granted hereunder and otherwise to carry out the intent and purposes of this Agreement, or for assuring and confirming to the Secured Party the grant or perfection of a security interest in all the Collateral.

(c)The Company hereby irrevocably appoints CrossHill as the Company's attorney-in-fact, with full authority in the place and stead of the Company and in the name of the Company, from time to time in CrossHill's discretion, to take any action and to execute any instrument which CrossHill may deem necessary or advisable to accomplish the purposes of this Agreement, including the filing, in its sole discretion, of one or more financing or continuation statements and amendments thereto, relative to any of the Collateral without the signature of the Company where permitted by law.

13.Acknowledgement of CrossHill and Yarbrough. CrossHill acknowledges that a member of CrossHill Georgetown Management LLC, which is the general partner of CrossHill, Stuart J. Yarbrough (“Yarbrough”), is the Chairman of the Board and a member of the Board of Directors of the Company. CrossHill and Yarbourgh (pursuant to his execution of this Agreement for the sole purpose of this Section 13) agree that Yarbrough will abstain and not participate in any action or failure to take action pursuant to the terms of this Agreement for so long as Yarbrough remains a director or executive officer of the Company.

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14.Notices. All notices, requests, demands and other communications hereunder shall be in writing, with copies to all the other parties hereto, and shall be deemed to have been duly given when (i) if delivered by hand, upon receipt, (ii) if sent by nationally recognized overnight delivery service (receipt requested), the next business day or (iii) if mailed by first-class certified mail, return receipt requested, postage prepaid, four days after posting in the U.S. mails, in each case if delivered to the following addresses:

If to the Company: Market Central, Inc.

6701 Carmel Road

Suite 205

Charlotte, NC 28226

Attention: Clifford Clark, Chief Financial Officer

With copies to: Greenberg Traurig, LLP

Suite 400

3290 Northside Parkway

Atlanta, GA 30327

Attention: Gerald L. Baxter

If to the Secured Party: CrossHill Georgetown Capital, LP

1000 Wilson Blvd.

Suite 1850

Arlington, VA 22209

Attention: Stephen X. Graham

15.Other Security. To the extent that the Obligations are now or hereafter secured by property other than the Collateral or by the guarantee, endorsement or property of any other person, firm, corporation or other entity, then the Secured Party shall have the right, in its sole discretion, to pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any way modifying or affecting any of the Secured Party’s rights and remedies hereunder.

16.Miscellaneous.

(a)No course of dealing between the Company and the Secured Party, nor any failure to exercise, nor any delay in exercising, on the part of the Secured Party, any right, power or privilege hereunder or under the Senior Notes shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

(b)All of the rights and remedies of the Secured Party with respect to the Collateral, whether established hereby or by the Senior Notes or by any other agreements, instruments or documents or by law shall be cumulative and may be exercised singly or concurrently.

10

(c)This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and is intended to supersede all prior negotiations, understandings and agreements with respect thereto. Except as specifically set forth in this Agreement, no provision of this Agreement may be modified or amended except by a written agreement specifically referring to this Agreement and signed by the parties hereto.

(d)In the event that any provision of this Agreement is held to be invalid, prohibited or unenforceable in any jurisdiction for any reason, unless such provision is narrowed by judicial construction, this Agreement shall, as to such jurisdiction, be construed as if such invalid, prohibited or unenforceable provision had been more narrowly drawn so as not to be invalid, prohibited or unenforceable. If, notwithstanding the foregoing, any provision of this Agreement is held to be invalid, prohibited or unenforceable in any jurisdiction, such provision, as to such jurisdiction, shall be ineffective to the extent of such invalidity, prohibition or unenforceability without invalidating the remaining portion of such provision or the other provisions of this Agreement and without affecting the validity or enforceability of such provision or the other provisions of this Agreement in any other jurisdiction.

(e)No waiver of any breach or default or any right under this Agreement shall be considered valid unless in writing and signed by the party giving such waiver, and no such waiver shall be deemed a waiver of any subsequent breach or default or right, whether of the same or similar nature or otherwise.

(f)This Agreement shall be binding upon and inure to the benefit of each party hereto and its successors and assigns.

(g)Each party shall take such further action and execute and deliver such further documents as may be necessary or appropriate in order to carry out the provisions and purposes of this Agreement.

(h)This Agreement shall be construed in accordance with the laws of the State of Georgia, except to the extent the validity, perfection or enforcement of a security interest hereunder in respect of any particular Collateral which are governed by a jurisdiction other than the State of Georgia, in which case such law shall govern. Each of the parties hereto irrevocably submit to the exclusive jurisdiction of any Georgia or United States Federal court sitting in Georgia over any action or proceeding arising out of or relating to this Agreement, and the parties hereto hereby irrevocably agree that all claims in respect of such action or proceeding may be heard and determined in such Georgia State or Federal court. The parties hereto agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. The parties hereto further waive any objection to venue in the State of Georgia and any objection to an action or proceeding in the State of Georgia on the basis of forum non conveniens. The parties further agree that the successful or prevailing party in any proceeding shall be entitled to recover attorneys’ fees and other costs incurred in such proceeding.

11

(i)EACH PARTY HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRAIL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATER OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR EACH PARTY TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH PARTY HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH PARTY WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY HAS KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHTS TO A JURY TRIAL FOLLOWING SUCH CONSULTATION. THIS WAIVER IS IRREVOCABLE, MEANING THAT, NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS AND SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. IN THE EVENT OF A LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

(j)This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original and, all of which taken together shall constitute one and the same Agreement. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such facsimile signature were the original thereof.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

12

IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be duly executed on the day and year first above written.

MARKET CENTRAL, INC.
By:
	Clifford Clark
	Chief Financial Officer

SECURED PARTIES:
By:	CrossHill Georgetown Capital, LP, as the duly authorized attorney in fact of the Secured Parties listed on Exhibit A hereto
By:
	General Partner
By:
YARBROUGH:
Stuart J. Yarbrough (for the sole purpose of Section 13 herein)

13

SCHEDULE A

Principal Place of Business of the Company:

Locations Where Collateral is Located or Stored:

List of subsidiaries of the Company:

S-1

SCHEDULE B

XML Patents

[insert DESCRIPTION]

S-2

SCHEDULE C

Jurisdictions:

S-3

EXHIBIT A

List of Secured Parties

Names and Address:

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

____________________________

E-1

EX-4.10

EXHIBIT 4.10

PREFERRED STOCK WARRANT

NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON ITS EXERCISE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (I) PURSUANT TO REGISTRATION UNDER THE ACT OR (II) IN COMPLIANCE WITH AN EXEMPTION THEREFROM AND ACCOMPANIED, IF REQUESTED BY THE COMPANY, WITH AN OPINION OF COUNSEL THAT SUCH TRANSFER IS IN COMPLIANCE WITH AN EXEMPTION THEREFROM (UNLESS SUCH TRANSFER IS TO AN AFFILIATE OF THE REGISTERED HOLDER).

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS

EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON

TRANSFER SET FORTH IN SECTION 3 OF THIS WARRANT

Date of Issuance: ______________, 2005	Number of Shares: __
No. __

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

Common Stock Purchase Warrant

Market Central, Inc., d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), for value received, hereby certifies that ________________________________, or its registered assigns (the “Registered Holder”), is entitled, subject to the terms and conditions set forth below, to purchase from the Company, in whole or in part, at any time and from time to time on or after the date of issuance and on or before 5:00 p.m., Atlanta, Georgia time, on June 30, 2007 (the “Exercise Period”), _____________ shares of Common Stock, $.001 par value per share, of the Company (the “Common Stock”), at an exercise price of $.85 per share. The shares purchasable upon exercise of this preferred warrant (“Warrant”) and the exercise price per share are hereinafter referred to as the “Warrant Shares” and the “Exercise Price,” respectively.

1.Exercise.

(a)This Warrant may be exercised by the Registered Holderby surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price payable in respect of the number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”).

(b)Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in Section 1(c) below shall be deemed to have become the holder or holders of record of the Warrant Shares represented by such certificates.

(c)Within ten (10) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 2 hereof.Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder.

(d)The Company shall use its best efforts toassist and cooperate with the Registered Holder to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company).

(e)Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a registered public offering, a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event.

2.Fractional Shares. No fractional shares will be issued upon the exercise of this Warrant.

3.Requirements for Transfer.

(a)This Warrant and the Warrant Shares shall not be sold or transferred unless either (i) they first shall have been registered under the Act or (ii) the Company first shall have been furnished with an opinion of legal counselto the effect that such sale or transfer is exempt from the registration requirements of the Act.

(b)Notwithstanding the foregoing, no registration or opinion of counsel shall be required for (i) a transfer by a Registered Holder which is a corporation to a wholly owned subsidiary of such corporation or to a corporation owned by the same parent entity of such corporation, a transfer by a Registered Holder which is a partnership to a partner of such partnership or a retired partner of such partnership or to the estate of any such partner or retired partner, or a transfer by a Registered Holder which is a limited liability company to a member of such limited liability company or a retired member or to the estate of any such member or retired member, provided that, as a condition to the Company effecting such transfer, the transferee in each case agrees in writing to be subject to the terms of this Section 3, or (ii) a transfer made in accordance with Rule 144 under the Act.

(c)Each certificate representing Warrant Shares shall bear a legend substantially in the following form:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY) IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

The foregoing legend shall be removed from the certificates representing any Warrant Shares, at the request of the holder thereof, at such time as they become eligible for resale pursuant to Rule 144(k) under the Act.

4.No Impairment. The Company will not, by amendment of its charter or through reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

5.Issuance Upon Exercise. All shares of Common Stock issuable upon exercise of this Warrant will be duly and validly issued, fully paid and nonassessable and will be free of restrictions on transfer, other than restrictions on transfer under any agreement between the Holder and the Company and under applicable state and federal securities laws, and will be free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously or otherwise specified herein).

6.Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and loss, theft, destruction or mutilation of any certificate evidencing this Warrant and in the case of loss, theft or destruction, upon delivery of an unsecured indemnity agreement of the Registered Holder in form reasonably satisfactory to the Company or in the case of mutilation, upon surrender and cancellation of such certificate, the Company shall, at its expense execute and deliver in lieu of such certificate, a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate.

7.Transfers, etc.

(a)The Company shall maintain a register at its principal executive office containing the name and address of the Registered Holder of this Warrant. The Registered Holder may change its or his address as shown on the warrant register by written notice to the Company requesting such change.

(b)Subject to the provisions of Section 3 hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant with a properly executed assignment (in the form of Exhibit B hereto) at the principal executive office of the Company.

(c)Until any transfer of this Warrant is made in the warrant register, the Company may treat the Registered Holder as the absolute owner hereof for all purposes; provided, however, that if and when this Warrant is properly assigned in blank, the Company may (but shall not be obligated to) treat the bearer hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.

(d)The Company shall not close its books against the transfer of this Warrant or any share of Common Stock issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant.

8.Mailing of Notices, etc. Any notice, request, demand or other communication required or permitted to be given to a party pursuant to the provisions of this Agreement will be in writing and will be effective and deemed given under this Agreement on the earliest of: (a) the date of personal delivery, (b) the date of transmission by facsimile, with confirmed transmission and receipt, (c) two (2) days after deposit with a nationally-recognized courier or overnight service such as Federal Express, or (d) five (5) days after mailing via certified mail, return receipt requested. All notices not delivered personally or by facsimile will be sent with postage and other charges prepaid and properly addressed to the party to be notified at the address set forth for such party:

If to the Registered Holder:

__________________________

__________________________

__________________________

Fax:______________________

Attn: _____________________

If to the Company:

Market Central, Inc. d/b/a Scientigo, Inc.

Suite 300

7810 Ballantyne Commons Parkway, NC 28277

Fax: (704) 319-2220

Attn: Chief Executive Officer

Any party hereto (and such party’s permitted assigns) may change such party’s address for receipt of future notices hereunder by giving written notice to the Company and the other parties hereto.

9.No Rights or Liabilities as Stockholder. Until the exercise of this Warrant, the Registered Holder shall be entitled to notice of all stockholders meetings as required to be made to all stockholders in accordance with the Company’s bylaws, but except as otherwise required by applicable law, shall not be entitled to vote on any matters submitted to the stockholders for a vote.

10.Amendment or Waiver. No term of this Warrant may be amended or waived without the written consent of the Company and the Registered Holder.

11.Successors and Assigns. This Warrant shall be binding upon and inure to the benefit of the Registered Holder and its assigns, and shall be binding upon any entity succeeding to the Company by consolidation, merger or acquisition of all or substantially all of the Company’s assets. The Company may not assign this Warrant or any rights or obligations hereunder without the prior written consent of the Registered Holder. The Registered Holder may assign this Warrant with the Company’s prior written consent.

12.Remedies. In the event of a breach by the Company of any of its obligations under this Warrant, the Registered Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of its breach of any of the provisions of this Warrant and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate.

13.Section Headings. The section headings in this Warrant are for the convenience of the parties and in no way alter, modify, amend, limit or restrict the contractual obligations of the parties.

14.Counterparts.This Warrant may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.

15.Severability. The provisions of this Warrant will be deemed severable and the invalidity or unenforceability of any provision hereof will not affect the validity or enforceability of the other provisions hereof; provided that if any provision of this Warrant, as applied to any party or to any circumstance, is adjudged by a court, governmental body, arbitrator, or mediator not to be enforceable in accordance with its terms, the parties agree that the court, governmental body, arbitrator, or mediator making such determination will have the power to modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its reduced form, such provision will then be enforceable and will be enforced.

16.Third Parties.Nothing in this Warrant, express or implied, is intended to confer upon any person other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Warrant.

17.Governing Law. This Warrant and the performance of the transactions and the obligations of the parties hereunder will be governed by and construed and enforced in accordance with the laws of the State of Delaware, without giving effect to any choice of law principles.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers under its corporate seal and to be dated the Date of Issuance hereof.

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

By:___________________________________

Name:

Title:

[Corporate Seal]

ATTEST:

_________________________

EXHIBIT A

PURCHASE FORM

To:_________________ Dated:____________

The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby irrevocably elects to purchase _____ shares of the Common Stock covered by such Warrant.

The undersigned herewith makes payment of the full exercise price for such shares at the price per share provided for in such Warrant, which is $________ in lawful money of the United States.

________________________________

By: ____________________________

________________________________

Name:

Title:

Address:_______________________

_______________________

EXHIBIT B

ASSIGNMENT FORM

FOR VALUE RECEIVED, ________________________________________ hereby sells, assigns and transfers all of the rights of the undersigned under the attached Warrant with respect to the number of shares of Common Stock covered thereby set forth below, unto:

Name of Assignee Address No. of Shares

Dated:_____________________

[___________________________]

_____________________________

Name:

Title:

Signature Guaranteed:

By: _______________________

The signature should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program) pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934.

EX-4.11

EXHIBIT 4.11

NOTE WARRANT

NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK ISSUABLE UPON ITS EXERCISE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (I) PURSUANT TO REGISTRATION UNDER THE ACT OR (II) IN COMPLIANCE WITH AN EXEMPTION THEREFROM AND ACCOMPANIED, IF REQUESTED BY THE COMPANY, WITH AN OPINION OF COUNSEL THAT SUCH TRANSFER IS IN COMPLIANCE WITH AN EXEMPTION THEREFROM (UNLESS SUCH TRANSFER IS TO AN AFFILIATE OF THE REGISTERED HOLDER).

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS

EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON

TRANSFER SET FORTH IN SECTION 3 OF THIS WARRANT

Date of Issuance: ______________, 2005	Number of Shares: __
No. __

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

Common Stock Purchase Warrant

Market Central, Inc., d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), for value received, hereby certifies that ________________________________, or its registered assigns (the “Registered Holder”), is entitled, subject to the terms and conditions set forth below, to purchase from the Company, in whole or in part, at any time and from time to time on or after the date of issuance and on or before 5:00 p.m., Atlanta, Georgia time, on June 30, 2010, but not thereafter (the “Exercise Period”), _____________ shares of Common Stock, $.001 par value per share, of the Company (the “Common Stock”), at an exercise price of $1.00 per share.  The shares purchasable upon exercise of this warrant (“Warrant”) and the exercise price per share  are hereinafter referred to as the “Warrant Shares” and the “Exercise Price,” respectively.

1.             Exercise.

(a)           This Warrant may be exercised by the Registered Holderby surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price payable in respect of the number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”).

(b)           Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 1(a) above (the “Exercise Date”).  At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in Section 1(c) below shall be deemed to have become the holder or holders of record of the Warrant Shares represented by such certificates.

(c)           Within ten (10) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 2 hereof.  Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder.

(d)           The Company shall use its best efforts toassist and cooperate with the Registered Holder to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company).

(e)           Notwithstanding any other provision of this Warrant, if the exercise of all or any portion of this Warrant is to be made in connection with a registered public offering, a sale of the Company or any other transaction or event, such exercise may, at the election of the Registered Holder, be conditioned upon consummation of such transaction or event in which case such exercise shall not be deemed effective until the consummation of such transaction or event.

2.             Fractional Shares.  No fractional shares will be issued upon the exercise of this Warrant.

3.             Requirements for Transfer.

(a)           This Warrant and the Warrant Shares shall not be sold or transferred unless either (i) they first shall have been registered under the Act or (ii) the Company first shall have been furnished with an opinion of legal counselto the effect that such sale or transfer is exempt from the registration requirements of the Act.

(b)           Notwithstanding the foregoing, no registration or opinion of counsel shall be required for (i) a transfer by a Registered Holder which is a corporation to a wholly owned subsidiary of such corporation or to a corporation owned by the same parent entity of such corporation, a transfer by a Registered Holder which is a partnership to a partner of such partnership or a retired partner of such partnership or to the estate of any such partner or retired partner, or a transfer by a Registered Holder which is a limited liability company to a member of such limited liability company or a retired member or to the estate of any such member or retired member, provided that, as a condition to the Company effecting such transfer, the transferee in each case agrees in writing to be subject to the terms of this Section 3, or (ii) a transfer made in accordance with Rule 144 under the Act.

(c)           Each certificate representing Warrant Shares shall bear a legend substantially in the following form:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY) IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

The foregoing legend shall be removed from the certificates representing any Warrant Shares, at the request of the holder thereof, at such time as they become eligible for resale pursuant to Rule 144(k) under the Act.

4.             No Impairment.  The Company will not, by amendment of its charter or through reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment. 

5.             Issuance Upon Exercise.  All shares of Common Stock issuable upon exercise of this Warrant will be duly and validly issued, fully paid and nonassessable and will be free of restrictions on transfer, other than restrictions on transfer under any agreement between the Holder and the Company and under applicable state and federal securities laws, and will be free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously or otherwise specified herein). 

6.             Replacement of Warrant.  Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and loss, theft, destruction or mutilation of any certificate evidencing this Warrant and in the case of loss, theft or destruction, upon delivery of an unsecured indemnity agreement of the Registered Holder in form reasonably satisfactory to the Company or in the case of mutilation, upon surrender and cancellation of such certificate, the Company shall, at its expense execute and deliver in lieu of such certificate, a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate.

7.             Transfers, etc.

(a)           The Company shall maintain a register at its principal executive office containing the name and address of the Registered Holder of this Warrant.  The Registered Holder may change its or his address as shown on the warrant register by written notice to the Company requesting such change.

(b)           Subject to the provisions of Section 3 hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant with a properly executed assignment (in the form of Exhibit B hereto) at the principal executive office of the Company.

(c)           Until any transfer of this Warrant is made in the warrant register, the Company may treat the Registered Holder as the absolute owner hereof for all purposes; provided, however, that if and when this Warrant is properly assigned in blank, the Company may (but shall not be obligated to) treat the bearer hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.

(d)           The Company shall not close its books against the transfer of this Warrant or any share of Common Stock issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant. 

8.             Mailing of Notices, etc. Any notice, request, demand or other communication required or permitted to be given to a party pursuant to the provisions of this Agreement will be in writing and will be effective and deemed given under this Agreement on the earliest of: (a) the date of personal delivery, (b) the date of transmission by facsimile, with confirmed transmission and receipt, (c) two (2) days after deposit with a nationally-recognized courier or overnight service such as Federal Express, or (d) five (5) days after mailing via certified mail, return receipt requested.  All notices not delivered personally or by facsimile will be sent with postage and other charges prepaid and properly addressed to the party to be notified at the address set forth for such party:

If to the Registered Holder:

__________________________

__________________________

__________________________

Fax:______________________

Attn: _____________________

If to the Company:

Market Central, Inc. d/b/a Scientigo, Inc.

Suite 300

7810 Ballantyne Commons Parkway, NC 28277

Fax:  (704) 319-2220

Attn:  Chief Executive Officer

Any party hereto (and such party’s permitted assigns) may change such party’s address for receipt of future notices hereunder by giving written notice to the Company and the other parties hereto.

9.             No Rights or Liabilities as Stockholder.  Until the exercise of this Warrant, the Registered Holder shall be entitled to notice of all stockholders meetings as required to be made to all stockholders in accordance with the Company’s bylaws, but except as otherwise required by applicable law, shall not be entitled to vote on any matters submitted to the stockholders for a vote.

10.          Amendment or Waiver.   No term of this Warrant may be amended or waived without the written consent of the Company and the Registered Holder. 

11.          Successors and Assigns.  This Warrant shall be binding upon and inure to the benefit of the Registered Holder and its assigns, and shall be binding upon any entity succeeding to the Company by consolidation, merger or acquisition of all or substantially all of the Company’s assets.  The Company may not assign this Warrant or any rights or obligations hereunder without the prior written consent of the Registered Holder.  The Registered Holder may assign this Warrant with the Company’s prior written consent.

12.          Remedies.    In the event of a breach by the Company of any of its obligations under this Warrant, the Registered Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant.  The Company agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of its breach of any of the provisions of this Warrant and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate.

13.          Section Headings.  The section headings in this Warrant are for the convenience of the parties and in no way alter, modify, amend, limit or restrict the contractual obligations of the parties.

14.          Counterparts.  This Warrant may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.

15.          Severability.  The provisions of this Warrant will be deemed severable and the invalidity or unenforceability of any provision hereof will not affect the validity or enforceability of the other provisions hereof; provided that if any provision of this Warrant, as applied to any party or to any circumstance, is adjudged by a court, governmental body, arbitrator, or mediator not to be enforceable in accordance with its terms, the parties agree that the court, governmental body, arbitrator, or mediator making such determination will have the power to modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its reduced form, such provision will then be enforceable and will be enforced.

16.          Third Parties.Nothing in this Warrant, express or implied, is intended to confer upon any person other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Warrant.

17.          Governing Law. This Warrant and the performance of the transactions and the obligations of the parties hereunder will be governed by and construed and enforced in accordance with the laws of the State of Delaware, without giving effect to any choice of law principles.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers under its corporate seal and to be dated the Date of Issuance hereof.

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

By:___________________________________

Name:

Title:

[Corporate Seal]                                                  

ATTEST:

_________________________

EXHIBIT A

PURCHASE FORM

To:_________________  Dated:____________

The undersigned, pursuant to the provisions set forth in the attached Warrant, hereby irrevocably elects to purchase _____ shares of the Common Stock covered by such Warrant.

The undersigned herewith makes payment of the full exercise price for such shares at the price per share provided for in such Warrant, which is $________ in lawful money of the United States.

_______________________________________

By: ____________________________________

       Name:

       Title:

Address: _______________________________

                 _______________________________

EXHIBIT B

ASSIGNMENT FORM

FOR VALUE RECEIVED, ________________________________________ hereby sells, assigns and transfers all of the rights of the undersigned under the attached Warrant with respect to the number of shares of Common Stock covered thereby set forth below, unto:

Name of Assignee Address No. of Shares

Dated:_____________________                                                                                                                                                

[___________________________]

_____________________________

Name:

Title:

Signature Guaranteed:

By: _______________________

The signature should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program) pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934.

EX-4.12

EXHIBIT 4.12

A WARRANT

Date of Issuance: ______________, 200_	Number of Shares: __
No. __

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

A Warrant

Market Central, Inc., d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), for value received, hereby certifies that ________________________________, or its registered assigns (the “Registered Holder”), is entitled, subject to the terms and conditions set forth below, to purchase from the Company, in whole or in part, at any time and from time to time on or after the date of issuance and on or before 5:00 p.m., Atlanta, Georgia time, on __________, 200_, but not thereafter (the “Exercise Period”), _____________ shares of Common Stock, $.001 par value per share, of the Company (the “Common Stock”), at an exercise price of $.85 per share. The shares purchasable upon exercise of this warrant (“Warrant”) and the exercise price per share are hereinafter referred to as the “Warrant Shares” and the “Exercise Price,” respectively.

1. Exercise.

(a)This Warrant may be exercised by the Registered Holderby surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price payable in respect of the number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”).

(b)Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in Section 1(c) below shall be deemed to have become the holder or holders of record of the Warrant Shares represented by such certificates.

(c)Within ten (10) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 2 hereof.Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder.

(d)The Company shall use its best efforts toassist and cooperate with the Registered Holder to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company).

2. Fractional Shares. No fractional shares will be issued upon the exercise of this Warrant.

3. Requirements for Transfer.

(a)This Warrant and the Warrant Shares shall not be sold or transferred unless either (i) they first shall have been registered under the Act or (ii) the Company first shall have been furnished with an opinion of legal counselto the effect that such sale or transfer is exempt from the registration requirements of the Act.

(b)Notwithstanding the foregoing, no registration or opinion of counsel shall be required for (i) a transfer by a Registered Holder which is a corporation to a wholly owned subsidiary of such corporation or to a corporation owned by the same parent entity of such corporation, a transfer by a Registered Holder which is a partnership to a partner of such partnership or a retired partner of such partnership or to the estate of any such partner or retired partner, or a transfer by a Registered Holder which is a limited liability company to a member of such limited liability company or a retired member or to the estate of any such member or retired member, provided that, as a condition to the Company effecting such transfer, the transferee in each case agrees in writing to be subject to the terms of this Section 3, or (ii) a transfer made in accordance with Rule 144 under the Act.

4. No Impairment. The Company will not, by amendment of its charter or through reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

5. Reorganization, Reclassification, Consolidation, Merger or Sale, etc.

(i)If the Company at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise) its class of outstanding shares of the Common Stock into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of shares of Common Stock issuable hereunder shall be proportionately increased, and if the Company at any time combines (by reverse stock split or otherwise) one or more classes of its outstanding shares of its Common Stock, the Exercise Price in effect immediately prior to such combination will be proportionately increased  and the number of shares of Common Stock issuable hereunder shall be proportionately decreased, concurrently with the effectiveness of such event.

(ii)Any capital reorganization, reclassification, consolidation, merger or sale of all or substantially all of the Company’s assets to another person which is effected in such a way that holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock is referred to herein as an “Organic Change.” Prior to the consummation of any Organic Change, the Company will make appropriate provisions to insure that the Registered Holder will thereafter upon subsequent exercise of this Warrant have the right to acquire and receive such shares of stock, securities or assets as such Holder would have received in connection with such Organic Change if such holder had exercised this Warrant immediately prior to such Organic Change. The Company will not effect any such consolidation, merger or sale, unless prior to the consummation thereof, the successor Company (if other than the Company) resulting from consolidation or merger or the Company purchasing such assets assumes by written instrument the obligation to deliver to the Registered Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such Holder may be entitled to acquire.

6. Issuance Upon Exercise. All shares of Common Stock issuable upon exercise of this Warrant will be duly and validly issued, fully paid and nonassessable and will be free of restrictions on transfer, other than restrictions on transfer under any agreement between the Holder and the Company and under applicable state and federal securities laws, and will be free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously or otherwise specified herein).

7. Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and loss, theft, destruction or mutilation of any certificate evidencing this Warrant and in the case of loss, theft or destruction, upon delivery of an unsecured indemnity agreement of the Registered Holder in form reasonably satisfactory to the Company or in the case of mutilation, upon surrender and cancellation of such certificate, the Company shall, at its expense execute and deliver in lieu of such certificate, a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate.

8. Transfers, etc.

(a)The Company shall maintain a register at its principal executive office containing the name and address of the Registered Holder of this Warrant. The Registered Holder may change its or his address as shown on the warrant register by written notice to the Company requesting such change.

(b)Subject to the provisions of Section 3 hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant with a properly executed assignment (in the form of Exhibit B hereto) at the principal executive office of the Company.

(c)Until any transfer of this Warrant is made in the warrant register, the Company may treat the Registered Holder as the absolute owner hereof for all purposes.

(d)The Company shall not close its books against the transfer of this Warrant or any share of Common Stock issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant.

9. Mailing of Notices, etc. Any notice, request, demand or other communication required or permitted to be given to a party pursuant to the provisions of this Agreement will be in writing and will be effective and deemed given under this Agreement on the earliest of: (a) the date of personal delivery, (b) the date of transmission by facsimile, with confirmed transmission and receipt, (c) two (2) days after deposit with a nationally-recognized courier or overnight service such as Federal Express, or (d) five (5) days after mailing via certified mail, return receipt requested. All notices not delivered personally or by facsimile will be sent with postage and other charges prepaid and properly addressed to the party to be notified at the address set forth for such party:

If to the Registered Holder:

__________________________

__________________________

__________________________

Fax:______________________

Attn: _____________________

If to the Company:

Market Central, Inc. d/b/a Scientigo, Inc.

Suite 205

6701 Carmel Road

Charlotte, NC 28266

Fax: (704) 540-5628

Attn: Chief Financial Officer

Any party hereto (and such party’s permitted assigns) may change such party’s address for receipt of future notices hereunder by giving written notice to the Company and the other parties hereto.

10. No Rights or Liabilities as Stockholder. Until the exercise of this Warrant, the Registered Holder shall be entitled to notice of all stockholders meetings as required to be made to all stockholders in accordance with the Company’s bylaws, but except as otherwise required by applicable law, shall not be entitled to vote on any matters submitted to the stockholders for a vote.

11. Amendment or Waiver. No term of this Warrant may be amended or waived without the written consent of the Company and the Registered Holder.

12. Successors and Assigns. This Warrant shall be binding upon and inure to the benefit of the Registered Holder and its assigns, and shall be binding upon any entity succeeding to the Company by consolidation, merger or acquisition of all or substantially all of the Company’s assets. The Company may not assign this Warrant or any rights or obligations hereunder without the prior written consent of the Registered Holder. The Registered Holder may assign this Warrant with the Company’s prior written consent.

13. Remedies. In the event of a breach by the Company of any of its obligations under this Warrant, the Registered Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of its breach of any of the provisions of this Warrant and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate.

14. Section Headings. The section headings in this Warrant are for the convenience of the parties and in no way alter, modify, amend, limit or restrict the contractual obligations of the parties.

15. Counterparts.This Warrant may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.

16. Severability. The provisions of this Warrant will be deemed severable and the invalidity or unenforceability of any provision hereof will not affect the validity or enforceability of the other provisions hereof; provided that if any provision of this Warrant, as applied to any party or to any circumstance, is adjudged by a court, governmental body, arbitrator, or mediator not to be enforceable in accordance with its terms, the parties agree that the court, governmental body, arbitrator, or mediator making such determination will have the power to modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its reduced form, such provision will then be enforceable and will be enforced.

17. Third Parties.Nothing in this Warrant, express or implied, is intended to confer upon any person other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Warrant.

18.Governing Law. This Warrant and the performance of the transactions and the obligations of the parties hereunder will be governed by and construed and enforced in accordance with the laws of the State of Delaware, without giving effect to any choice of law principles.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers under its corporate seal and to be dated the Date of Issuance hereof.

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

By:___________________________________

Name:

Title:

[Corporate Seal]

ATTEST:

_________________________

EXHIBIT A

A WARRANT

PURCHASE FORM

To:_________________ Dated:____________

The undersigned, pursuant to the provisions set forth in the attached A Warrant, hereby irrevocably elects to purchase _____ shares of the Common Stock covered by such A Warrant.

The undersigned herewith makes payment of the full exercise price for such shares at the price per share provided for in such A Warrant, which is $________ in lawful money of the United States.

________________________________

By: ____________________________

________________________________

Name:

Title:

Address:_______________________

_______________________

EXHIBIT B

A WARRANT

ASSIGNMENT FORM

FOR VALUE RECEIVED, ________________________________________ hereby sells, assigns and transfers all of the rights of the undersigned under the attached A Warrant with respect to the number of shares of Common Stock covered thereby set forth below, unto:

Name of Assignee Address No. of Shares

Dated:_____________________

[___________________________]

_____________________________

Name:

Title:

Signature Guaranteed:

By: _______________________

The signature should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program) pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934.

EX-4.13

EXHIBIT 4.13

B WARRANT

THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS (I) PURSUANT TO REGISTRATION UNDER THE ACT OR (II) IN COMPLIANCE WITH AN EXEMPTION THEREFROM AND ACCOMPANIED, IF REQUESTED BY THE COMPANY, WITH AN OPINION OF COUNSEL THAT SUCH TRANSFER IS IN COMPLIANCE WITH AN EXEMPTION THEREFROM (UNLESS SUCH TRANSFER IS TO AN AFFILIATE OF THE REGISTERED HOLDER).

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUED UPON ITS

EXERCISE ARE SUBJECT TO THE RESTRICTIONS ON

            TRANSFER SET FORTH IN SECTION 4 OF THIS WARRANT       

Date of Issuance: ______________, 200_	Number of Shares: __
No. __

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

B Warrant

Market Central, Inc., d/b/a Scientigo, Inc., a Delaware corporation (the “Company”), for value received, hereby certifies that ________________________________, or its registered assigns (the “Registered Holder”), is entitled, subject to the terms and conditions set forth below, to purchase from the Company, in whole or in part, at any time and from time to time on or after ______________, 200_ [12 months form the date of issuance] and on or before 5:00 p.m., Atlanta, Georgia time, on June 30, 2010, but not thereafter (the “Exercise Period”), _____________ shares of Common Stock, $.001 par value per share, of the Company (the “Common Stock”), at an exercise price of $1.00 per share. The shares purchasable upon exercise of this warrant (“Warrant”) and the exercise price per share are hereinafter referred to as the “Warrant Shares” and the “Exercise Price,” respectively.

1. Exercise.

(a)This Warrant may be exercised by the Registered Holderby surrendering this Warrant, along with the purchase form appended hereto as Exhibit A duly executed and completed by the Registered Holder or by the Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate by notice in writing to the Registered Holder, accompanied by cash or certified cashier’s check payable to the Company (or wire transfer of immediately available funds), in lawful money of the United States, of the Exercise Price payable in respect of the number of Warrant Shares purchased upon such exercise (the “Aggregate Exercise Price”).

(b)Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 1(a) above (the “Exercise Date”). At such time, the person or persons in whose name or names any certificates for Warrant Shares shall be issuable upon such exercise as provided in Section 1(c) below shall be deemed to have become the holder or holders of record of the Warrant Shares represented by such certificates.

(c)Within ten (10) days after the date of exercise of this Warrant, the Company, at its expense, will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of full Warrant Shares to which the Registered Holder shall be entitled upon such exercise plus, in lieu of any fractional share to which the Registered Holder would otherwise be entitled, cash in an amount determined pursuant to Section 2 hereof.Notwithstanding the foregoing, the Registered Holder shall be solely responsible for any income taxes payable and arising from the issuance or exercise of this Warrant, or any ad valorem property or intangible tax assessed against the Registered Holder.

(d)The Company shall use its best efforts toassist and cooperate with the Registered Holder to make any governmental filings or obtain any governmental approvals prior to or in connection with any exercise of this Warrant (including, without limitation, making any filings required to be made by the Company).

2.Termination of Exercise Rights.The Registered Holder acknowledges that as of the date hereof, he is the holder of A Warrants to purchase __________ shares of Common Stock of the Company (the “A Warrants”). At such time, if ever, that the holder of the A Warrants exercises such A Warrants, in whole or in part, the number of shares of Common Stock that are issuable pursuant to this Warrant shall decrease by the number of shares of Common Stock issued to the holder of the A Warrants upon such exercise of the A Warrants. If the number of shares of Common Stock issued pursuant to the exercise of the A Warrants is equal to or greater than the total number of shares of Common Stock issuable pursuant to the exercise of this Warrant, this Warrant shall terminate and be of no further force or effect.

3. Fractional Shares. No fractional shares will be issued upon the exercise of this Warrant.

4. Requirements for Transfer.

(a)This Warrant and the Warrant Shares shall not be sold or transferred unless either (i) they first shall have been registered under the Act or (ii) the Company first shall have been furnished with an opinion of legal counselto the effect that such sale or transfer is exempt from the registration requirements of the Act.

(b)Notwithstanding the foregoing, no registration or opinion of counsel shall be required for (i) a transfer by a Registered Holder which is a corporation to a wholly owned subsidiary of such corporation or to a corporation owned by the same parent entity of such corporation, a transfer by a Registered Holder which is a partnership to a partner of such partnership or a retired partner of such partnership or to the estate of any such partner or retired partner, or a transfer by a Registered Holder which is a limited liability company to a member of such limited liability company or a retired member or to the estate of any such member or retired member, provided that, as a condition to the Company effecting such transfer, the transferee in each case agrees in writing to be subject to the terms of this Section 3, or (ii) a transfer made in accordance with Rule 144 under the Act.

(c)Unless issued pursuant to an effective registration statement, each certificate representing Warrant Shares shall bear a legend substantially in the following form:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY) IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

The foregoing legend shall be removed from the certificates representing any Warrant Shares, at the request of the holder thereof, at such time as they become eligible for resale pursuant to Rule 144(k) under the Act.

(d) This Warrant shall not be transferable or otherwise assignable unless such transferee or assignee is an “accredited investor” as defined in Rule 501(a) of Regulation D under the Securities Act of 1933, as amended. Prior to any proposed transfer or assignment, the Registered Holder shall provide the Company with reasonable evidence of the accredited investor status of such transferee or assignee. Any purported transfer or assignment of the Warrant which does not comply with the terms of this provisions shall be null and void and of no legal effect.

5. No Impairment. The Company will not, by amendment of its charter or through reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

6.Reorganization, Reclassification, Consolidation, Merger or Sale, etc.

(i)If the Company at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise) its class of outstanding shares of the Common Stock into a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the number of shares of Common Stock issuable hereunder shall be proportionately increased, and if the Company at any time combines (by reverse stock split or otherwise) one or more classes of its outstanding shares of its Common Stock, the Exercise Price in effect immediately prior to such combination will be proportionately increased and the number of shares of Common Stock issuable hereunder shall be proportionately decreased, concurrently with the effectiveness of such event.

(ii)Any capital reorganization, reclassification, consolidation, merger or sale of all or substantially all of the Company’s assets to another person which is effected in such a way that holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock is referred to herein as an “Organic Change.” Prior to the consummation of any Organic Change, the Company will make appropriate provisions to insure that the Registered Holder will thereafter upon subsequent exercise of this Warrant have the right to acquire and receive such shares of stock, securities or assets as such Holder would have received in connection with such Organic Change if such holder had exercised this Warrant immediately prior to such Organic Change. The Company will not effect any such consolidation, merger or sale, unless prior to the consummation thereof, the successor Company (if other than the Company) resulting from consolidation or merger or the Company purchasing such assets assumes by written instrument the obligation to deliver to the Registered Holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such Holder may be entitled to acquire.

7. Issuance Upon Exercise. All shares of Common Stock issuable upon exercise of this Warrant will be duly and validly issued, fully paid and nonassessable and will be free of restrictions on transfer, other than restrictions on transfer under any agreement between the Holder and the Company and under applicable state and federal securities laws, and will be free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously or otherwise specified herein).

8. Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the Company (an affidavit of the Registered Holder shall be satisfactory) of the ownership and loss, theft, destruction or mutilation of any certificate evidencing this Warrant and in the case of loss, theft or destruction, upon delivery of an unsecured indemnity agreement of the Registered Holder in form reasonably satisfactory to the Company or in the case of mutilation, upon surrender and cancellation of such certificate, the Company shall, at its expense execute and deliver in lieu of such certificate, a new certificate of like kind representing the same rights represented by such lost, stolen, destroyed or mutilated certificate and dated the date of such lost, stolen, destroyed or mutilated certificate.

9. Transfers, etc.

(a)The Company shall maintain a register at its principal executive office containing the name and address of the Registered Holder of this Warrant. The Registered Holder may change its or his address as shown on the warrant register by written notice to the Company requesting such change.

(b)Subject to the provisions of Section 4 hereof, this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant with a properly executed assignment (in the form of Exhibit B hereto) at the principal executive office of the Company.

(c)Until any transfer of this Warrant is made in the warrant register, the Company may treat the Registered Holder as the absolute owner hereof for all purposes.

(d)The Company shall not close its books against the transfer of this Warrant or any share of Common Stock issued or issuable upon the exercise of this Warrant in any manner which interferes with the timely exercise of this Warrant.

10.Mailing of Notices, etc. Any notice, request, demand or other communication required or permitted to be given to a party pursuant to the provisions of this Agreement will be in writing and will be effective and deemed given under this Agreement on the earliest of: (a) the date of personal delivery, (b) the date of transmission by facsimile, with confirmed transmission and receipt, (c) two (2) days after deposit with a nationally-recognized courier or overnight service such as Federal Express, or (d) five (5) days after mailing via certified mail, return receipt requested. All notices not delivered personally or by facsimile will be sent with postage and other charges prepaid and properly addressed to the party to be notified at the address set forth for such party:

If to the Registered Holder:

__________________________

__________________________

__________________________

Fax:______________________

Attn: _____________________

If to the Company:

Market Central, Inc. d/b/a Scientigo, Inc.

Suite 205

6701 Carmel Road

Charlotte, NC 28266

Fax: (704) 540-5628

Attn: Chief Financial Officer

Any party hereto (and such party’s permitted assigns) may change such party’s address for receipt of future notices hereunder by giving written notice to the Company and the other parties hereto.

11. No Rights or Liabilities as Stockholder. Until the exercise of this Warrant, the Registered Holder shall be entitled to notice of all stockholders meetings as required to be made to all stockholders in accordance with the Company’s bylaws, but except as otherwise required by applicable law, shall not be entitled to vote on any matters submitted to the stockholders for a vote.

12. Amendment or Waiver. No term of this Warrant may be amended or waived without the written consent of the Company and the Registered Holder.

13. Successors and Assigns. This Warrant shall be binding upon and inure to the benefit of the Registered Holder and its assigns, and shall be binding upon any entity succeeding to the Company by consolidation, merger or acquisition of all or substantially all of the Company’s assets. The Company may not assign this Warrant or any rights or obligations hereunder without the prior written consent of the Registered Holder. The Registered Holder may assign this Warrant with the Company’s prior written consent.

14. Remedies. In the event of a breach by the Company of any of its obligations under this Warrant, the Registered Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not provide adequate compensation for any losses incurred by reason of its breach of any of the provisions of this Warrant and hereby further agrees that, in the event of any action for specific performance in respect of such breach, it shall waive the defense that a remedy at law would be adequate.

15. Section Headings. The section headings in this Warrant are for the convenience of the parties and in no way alter, modify, amend, limit or restrict the contractual obligations of the parties.

16. Counterparts.This Warrant may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.

17. Severability. The provisions of this Warrant will be deemed severable and the invalidity or unenforceability of any provision hereof will not affect the validity or enforceability of the other provisions hereof; provided that if any provision of this Warrant, as applied to any party or to any circumstance, is adjudged by a court, governmental body, arbitrator, or mediator not to be enforceable in accordance with its terms, the parties agree that the court, governmental body, arbitrator, or mediator making such determination will have the power to modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its reduced form, such provision will then be enforceable and will be enforced.

18. Third Parties.Nothing in this Warrant, express or implied, is intended to confer upon any person other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Warrant.

19. Governing Law. This Warrant and the performance of the transactions and the obligations of the parties hereunder will be governed by and construed and enforced in accordance with the laws of the State of Delaware, without giving effect to any choice of law principles.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and attested by its duly authorized officers under its corporate seal and to be dated the Date of Issuance hereof.

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

By:___________________________________

Name:

Title:

[Corporate Seal]

ATTEST:

_________________________

EXHIBIT A

B WARRANT

PURCHASE FORM

To:_________________ Dated:____________

The undersigned, pursuant to the provisions set forth in the attached B Warrant, hereby irrevocably elects to purchase _____ shares of the Common Stock covered by such B Warrant.

The undersigned herewith makes payment of the full exercise price for such shares at the price per share provided for in such B Warrant, which is $________ in lawful money of the United States.

________________________________

By: ____________________________

________________________________

Name:

Title:

Address:_______________________

 _______________________

EXHIBIT B

B WARRANT

ASSIGNMENT FORM

FOR VALUE RECEIVED, ________________________________________ hereby sells, assigns and transfers all of the rights of the undersigned under the attached B Warrant with respect to the number of shares of Common Stock covered thereby set forth below, unto:

Name of Assignee Address No. of Shares

Dated:_____________________

[___________________________]

_____________________________

Name:

Title:

Signature Guaranteed:

By: _______________________

The signature should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program) pursuant to Rule 17Ad-15 under the Securities Exchange Act of 1934.

EX-4.14

Exhibit 4.14

FIRST AMENDMENT TO SECURITY AGREEMENT

THIS FIRST AMENDMENT TO SECURITY AGREEMENT (this “Agreement”), dated as of November 7, 2005, is made by Market Central, Inc. dba Scientigo, Inc., a Delaware corporation (the "Company"), for the benefit of the secured parties signatory hereto pursuant to powers of attorney granted to CrossHill Georgetown Capital, LP, a Delaware limited partnership (“CrossHill”) and their respective endorsees, transferees and assigns (collectively, the "Secured Party").

W I T N E S E T H:

WHEREAS the parties hereto previously entered into that certain Security Agreement as of September 30, 2005 (the “Agreement”); and

WHEREAS, the parties desire to amend the Agreement in light of the contemplated rescission offer (the “Rescission Offer”) and exchange offer (the “Exchange Offer”) with respect to the Senior Notes and Warrants to provide that all notes and warrants issued to the Secured Party that may replace the Senior Notes and Warrants pursuant to such Rescission Offer and Exchange Offer are afforded the same rights as set forth in the Agreement after such issuances.

NOW, THEREFORE, in consideration of the agreements herein contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:

1. Defined Terms. All capitalized terms set forth herein shall have the same meaning as defined in the Agreement.

2.Amendment of Agreement. For all purposes of the Agreement, (a) the terms “Senior Notes” shall include the original senior notes and warrants issued in the Offering as well as the notes issued in the Rescission Offer and the A Notes and B Notes issued in the Exchange Offer, all to the extent outstanding following consummation of the Rescission Offer and the Exchange Offer, (b) the terms “Warrants” shall include the original warrants issued in the Offering as well as the warrants issued in the Rescission Offer and the A Warrants and B Warrants issued in the Exchange Offer, all to the extent outstanding following consummation of the Rescission Offer and the Exchange Offer; and (c) the term “Principal Amount” shall mean the principal amount of all outstanding Senior Notes, all to the extent outstanding following consummation of the Rescission Offer and the Exchange Offer.

3.No Further Changes.Except as specifically set forth herein, all terms and provisions of the Agreement shall remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to Security Agreement to be duly executed on the day and year first above written.

MARKET CENTRAL, INC.

By: 

Clifford Clark

Chief Financial Officer

SECURED PARTIES:

By: CrossHill Georgetown Capital, LP,
as the duly authorized attorney in
fact of the Secured Parties listed on
Exhibit A hereto

By: 

General Partner

YARBROUGH:

_______________________________
Stuart J. Yarbrough

(for the sole purpose of Section 13 of the
Agreement)

EX-5.1

EXHIBIT 5.1

November __, 2005

Market Central, Inc.

6701 Carmel Road

Suite 205

Charlotte, NC 28226

Ladies and Gentlemen:

We have examined the Company’s Registration Statement on Form S-4 (the "Registration Statement") filed with the Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "Securities Act") in connection with (i) the rescission offer with respect to $6,383,050 principal amount of the outstanding 2005 6.4% Senior Convertible Notes (the “Notes”) and Warrants to Purchase 3,164,788 shares of Common Stock, $.001 par value (the “Common Stock”) (the “Warrants”), (ii) the exchange offer of up to $5,147,160 principal amount of A 8% and B 8% Notes (the “New Notes”) and up to A Warrants and B Warrants to purchase 6,670,450 shares of Common Stock (the “New Warrants”), for the Notes and the Warrants, (iii) the registration of the issuance of up to 5,319,958 shares of Common Stock upon the conversion of Notes and New Notes, and (iv) the registration of the issuance of up to 10,052,886 shares of Common Stock upon the exercise of Warrants and New Warrants. For purposes of this opinion, the shares of Common Stock issued (i) pursuant to the conversion of Notes and New Notes, and (ii) pursuant to the exercise of Warrants and New Warrants shall be collectively referred to as the “Shares.”

In connection with our representation of the Company, and as a basis for the opinion hereinafter set forth, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following:

1)   the Registration Statement;

2)   the Certificate of Incorporation of the Company, as amended and restated to the date hereof;

3)   the Bylaws of the Company, as amended and restated to the date hereof;

4)   resolutions adopted by the Board of Directors of the Company, relating to the approval of the filing of the Registration Statement, together with the exhibits thereto, and other related matters; and

5)   Such other documents and matters of law as we have deemed necessary or appropriate to express the opinion set forth below, subject to the assumptions, limitations and qualifications stated herein.

On the basis of the foregoing, it is our opinion, subject to the effectiveness of the Registration Statement filed with the SEC (such Registration Statement as amended and finally declared effective, and the form of prospectus contained therein or subsequently filed pursuant to Rule 424 under the Securities Act, being hereinafter referred to as the "Registration Statement") that: (a) the Notes and the New Notes and the Warrants and New Warrants (to the extent outstanding following the termination of the rescission offer and exchange offer) will constitute valid and binding obligations of the Company except as may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or similar laws now or hereafter in effect relating to creditors' rights generally and may be subject to general principles of equity (regardless of whether considered in equity or at law); (b) upon payment and delivery of the exercise price in accordance with the terms of the Warrants and New Warrants (as described in the Registration Statement), the Shares issued in respect of such exercises shall be legally issued, fully paid and non-assessable shares of the Common Stock of the Company; and (c) upon conversion of the Notes and New Notes in accordance with their terms (as described in the Registration Statement) the Shares issued in respect of such conversions shall be legally issued, fully paid and non-assessable shares of the Common Stock of the Company.

We express no opinion as to the applicability or effect of any laws, orders or judgments of any state or jurisdiction other than the substantive laws of the State of Georgia. Further, our opinion is based solely upon the existing laws, rules and regulations, and we undertake no obligation to advise you of any changes that may be brought to our attention after the date hereof.

We hereby consent to the filing of this opinion with the Securities and Exchange Commission as an exhibit to the Registration Statement and to the reference to our firm under the heading "Legal Matters" therein. This consent is not to be construed as an admission that we are a party whose consent is required to be filed with the Registration Statement under the provisions of the Securities Act or the rules and regulations of the Securities and Exchange Commission promulgated thereunder.

The opinion expressed herein is solely for your benefit, and may be relied upon only by you.

Very truly yours,

/s/ GREENBERG TRAURIG, LLP

EX-10.3

EXHIBIT 10.3

EMPLOYMENT AGREEMENT

BY AND BETWEEN

MARKET CENTRAL, INC.

AND

CLIFFORD A. CLARK

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of September 1, 2004, by and between MARKET CENTRAL, INC., a Delaware corporation (the "Company"), and CLIFFORD A. CLARK ("Employee").

WHEREAS, the Company and Employee desire to enter into this Agreement to assure the Company of the services of Employee and to set forth the respective rights and duties of the parties hereto;

WHEREAS, the Company will engage in the business of creating, managing, developing and licensing software and technology solutions and any other lawful activities (such activities, present and future, being hereinafter referred to as the "Business");

NOW, THEREFORE, in consideration of the premises and the mutual covenants, terms and conditions set forth herein, the Company and Employee agree as follows:

ARTICLE I

Employment

1.1 Employment and Title. The Company hereby employs Employee, and Employee hereby accepts such employment, as Chief Financial Officer of the Company, all upon the terms and conditions set forth herein.

1.2 Services. During the Term (as hereinafter defined) hereof, Employee agrees to perform diligently and in good faith the duties of the Chief Financial Officer of the Company, under the direction of the CEO and Board of Directors. Employee agrees to devote his best efforts and a substantial amount of his business time, energies and abilities to the services to be performed hereunder and for the benefit of the Company. Employee shall be vested with such authority as is generally commensurate with the position of Chief Financial Officer of the Company, as further outlined below.

1.3 Location. The principal place of employment and the location of Employee's principal office shall be in Charlotte, North Carolina although a substantial amount of time may be required at the Company’s Jacksonville, NC facility; provided, however, Employee shall undertake all requisite travel in the performance of his duties under this Agreement.

1.4 Representations. Each party represents and warrants to the other that he/it has full power and authority to enter into and perform this Agreement and that his/its execution and performance of this Agreement shall not constitute a default under or breach of any of the terms of any agreement to which he/it is a party or under which he/it is bound. Each party represents that no consent or approval of any third party is required for his/its execution, delivery and performance of this Agreement or that all consents or approvals of any third party required for his/its execution, delivery and performance of this Agreement have been obtained. 

1.5 Sole Discretion. As the term "sole discretion" is used in this Agreement, unless otherwise defined, it will be interpreted as the exercise of reasonable discretion applying normal business practices to a contractual relationship between a company and its vice president of finance.

ARTICLE II

Term

2.1 Term. The term of Employee's employment hereunder (the "Term") shall commence as of September 1, 2004 (the "Commencement Date") and shall continue through the third anniversary of the Commencement Date (the "Scheduled Termination Date"), unless earlier terminated pursuant to the provisions of this Agreement. This Agreement shall automatically renew for an unlimited number of successive one-year terms unless either party shall deliver written notice of non-renewal at least ninety (90) days prior to the Scheduled Termination Date (or the Scheduled Termination Date of any renewal term).

ARTICLE III

Compensation

3.1 Base Salary. As compensation for the services to be rendered by Employee, the Company shall pay Employee, during the Term of this Agreement, an annual base salary of not less than One Hundred Twenty Thousand Dollars ($120,000), which base salary shall accrue monthly (prorated for periods less than a month) and shall be paid in equal semi-monthly installments. The base salary will be reviewed annually, or, more frequently, as appropriate, by the Board of Directors or the Compensation Committee of the Board of Directors, as the case may be, for upward, but not downward, adjustment in its sole discretion. One component that can affect the pay rate on an immediate basis is if Employee’s time is needed for full time efforts. . In the event that the Employee and the Board of Directors determine that financial conditions necessitate the deferral of all or a portion of this base salary, Employee shall receive common stock purchase warrants in the amount equal to the deferred salary for the preceding month. This amount shall be determined on the first day of each month by dividing the salary deferred during the immediately preceding month by 75% of the closing bid price of one share of common stock. This quotient shall be the number of shares employee will receive on that month’s warrant. The exercise price of the warrant shall be 75% of the closing bid price as used in the calculation and the warrant shall have a four (4) year life.

3.2 Bonus Compensation. Employee shall be eligible to receive bonus or incentive compensation, which may be granted from time to time in the sole discretion of the CEO or Board of Directors in accordance with the Company's compensation structure in effect from time to time.

3.3 Stock Options.As an incentive to use consistent and best efforts on behalf of Market Central, employee will be provided stock options. These Stock Option Agreements are attached as Exhibits “A” through “C”. It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated. 

3.4 Employee's Legal Fees. Employee may, and the Company has encouraged the Employee to, engage competent independent legal counsel for advice and guidance with respect to this Agreement, including, without limitation, advice as to the federal income tax consequences of this Article III. The Company shall reimburse Employee for all reasonable legal fees incurred by Employee in connection with the negotiation and execution of this Agreement.

3.5 Benefits. Employee shall be entitled, during the Term hereof, to the same medical, hospital, dental, health club and life insurance coverage and benefits as are then available to the Company's most senior executive officers, together with the following additional benefits:

(a)Comprehensive medical coverage, including dependent coverage, paid fully by the Company;

(b)Life insurance in an amount equal to two times Employee's base salary;

(c)Long-term disability insurance in an amount, adjusted annually, equal to two-thirds of Employee's prior year base salary and incentive compensation, if any, excluding compensation earned through Company stock options or other securities; and

(d)The Company's normal vacation allowance for all employees who are executive officers of the Company.

3.Withholding. Any and all amounts payable under this Agreement, including, without limitation, amounts payable under this Article III and Article VII, are subject to withholding for such federal, state and local taxes required pursuant to any applicable law, rule or regulation.

ARTICLE IV

Working Facilities, Expenses and Insurance

4.1 Working Facilities and Expenses. Employee shall be furnished with an office at the Employee's principal office as set forth in Section 1.3 hereof, or at such other location as agreed to by Employee and the Company, and other working facilities and secretarial and other assistance suitable to his position and reasonably required for the performance of his duties hereunder. The Company shall reimburse Employee for all of Employee's reasonable expenses incurred while employed and performing his duties under and in accordance with the terms and conditions of this Agreement, subject to Employee's full and appropriate documentation, including, without limitation, receipts for all such expenses in the manner required pursuant to Company's policies and procedures and the Internal Revenue Code of 1986, as amended (the "Code"), and applicable regulations in effect from time to time.

4.2 Insurance. The Company may secure in its own name or otherwise, and at its own expense, life, disability and other insurance covering Employee or Employee and others, and Employee shall not have any right, title or interest in or to such insurance other than as expressly provided herein. Employee agrees to assist the Company in procuring such insurance by submitting to the usual and customary medical and other examinations to be conducted by such physicians(s) as the Company or such insurance company may designate and by signing such applications and other written instruments as may be required by any insurance company to which application is made for such insurance. Any information provided by Employee to such insurance company (the results of examinations being deemed part of such information) will be provided on a confidential basis, and the Company shall have no access thereto.

ARTICLE V

Illness or Incapacity

5.1 Right to Terminate. If, during the Term of this Agreement, Employee shall be unable to perform, with or without a reasonable accommodation, in all material respects the essential duties of his employment hereunder for a period exceeding six (6) consecutive months by reason of illness or incapacity, this Agreement may be terminated by the Company in its sole discretion pursuant to Section 7.2 hereof.

5.2 Right to Replace. If Employee's illness or incapacity, whether by physical or mental cause, renders him unable for a minimum period of thirty (30) consecutive calendar days to carry out his duties and responsibilities as set forth herein, the Company shall have the right to designate a person to temporarily perform Employee's duties; provided, however, that if Employee returns to work from such illness or incapacity within the six (6) month period following his inability due to such illness or incapacity, he shall be entitled to be reinstated in the capacity described in Article I hereof with all rights, duties and privileges attendant thereto.

5.3 Rights Prior to Termination. Employee shall be entitled to his full base salary under Section 3.1 hereof and full benefits under Section 3.4 hereof during such illness or incapacity unless and until an election is made by the Company to terminate this Agreement in accordance with the provisions of this Article V.

5.4 Determination of Illness or Incapacity. For purposes of this Article V, the term "illness or incapacity" shall mean Employee's inability to perform his duties hereunder substantially on a full-time basis due to physical or mental illness as determined by the Board of Directors, in its reasonable discretion based upon competent medical evidence. Upon the Company's written request, Employee shall submit to reasonable medical and other examinations to provide the evidence required hereunder.

ARTICLE VI

Confidentiality

6.1 Confidentiality. During the Term of this Agreement and for a period of five (5) years thereafter, Employee agrees to maintain the confidential nature of the Company's confidential and proprietary trade secrets, including, without limitation, development ideas, acquisition strategies and plans, financial information, records, "know-how", methods of doing business, customer, supplier and distributor lists and all other confidential information of the Company. Employee shall not use (other than in connection with his employment), in any way whatsoever, such trade secrets except as authorized in writing by the Company. Employee shall, upon the termination of his employment, deliver to the Company any and all records, books, documents or any other materials whatsoever (including all copies thereof) containing such trade secrets that shall be and remain the property of the Company.

6.2 Non-Removal of Records. All documents, papers, materials, notes, books, correspondence, drawings and other written, graphic and electronic records of the Business of the Company which Employee shall prepare or use, or come into contact with, shall be and remain the sole property of the Company and, effective immediately upon the termination of the Employee's employment with the Company for any reason, shall not be removed from the Company's premises without the Company's prior written consent.

ARTICLE VII

Termination

7.1 Termination For Cause. This Agreement and the employment of Employee may be terminated by the Company "For Cause" upon the determination of not less than 75% of the members of the Board of Directors of the Company (the “Super Majority”),  in any of the following circumstances:

(a)Employee has committed any fraud, dishonesty, misappropriation or similar wrongful act against the Company; or

(b)Employee is in default in a material respect in the performance of Employee's obligations, services or duties hereunder, which shall include, without limitation, Employee's willfully disregarding the written instructions of the Board of Directors or CEO of the Company concerning the conduct of his duties hereunder, Employee's conduct which, after written notice and an opportunity to cure, is materially inconsistent with the published policies of the Company, as promulgated from time to time and which are generally applicable to all employees and/or senior executives, or Employee's breach of any other material provision of this Agreement; or

(c)Employee is grossly negligent or engages in willful misconduct in the performance of his duties hereunder; or

(d)Employee has been adjudicated guilty by, or enters a plea of guilty or no contest before, a court of competent jurisdiction of illegal activities or found by a court of competent jurisdiction to have engaged in other wrongful conduct which individually, or in the aggregate, has a material adverse effect on the Company, its prospects, earnings or financial condition, other than minor traffic infractions.

A Termination For Cause under this Section 7.1 shall be effective upon the date set forth in a written notice of termination delivered to Employee.

7.2 Termination Without Cause. This Agreement and the employment of the Employee may be terminated "Without Cause" as follows:

(a)By mutual agreement of the parties hereto; or

(b)At the election of the Company by its giving not less than thirty (30) days' written notice to Employee in the event of an illness or incapacity described in Section 5.1; or

(c)Upon Employee's death.

A Termination Without Cause under Sections 7.2(b) or (c) hereof shall be effective upon the date set forth in a written notice of termination or resignation delivered hereunder, which shall be not less than thirty (30) days nor more than forty-five (45) days after the giving of such notice.

7.3 Effect of Termination For Cause. If Employee's employment is terminated For Cause:

(a)Employee shall be entitled to accrued base salary under Section 3.1 and accrued vacation pay, each through the date of termination;

(b)Employee shall be entitled to reimbursement for expenses accrued through the date of termination in accordance with the provisions of Section 4.1 hereof; and

(c)Except as provided in Article XI, this Agreement shall thereupon be of no further force and effect.

7.4 Effect of Termination Without Cause. If Employee's employment is terminated Without Cause:

(a)Employee shall be entitled to accrued base salary under Section 3.1 and accrued vacation pay, each through the date of termination;

(b)Employee shall be entitled to reimbursement for expenses accrued through the date of termination in accordance with the provisions of Section 4.1 hereof;

(c)Employee shall be entitled to receive all amounts of base salary as would have been payable under Section 3.1 (provided that Employee shall receive not less than twenty-four (24) months of base salary) through the Scheduled Termination Date of the applicable term hereof, which amounts shall be paid upon termination;

(d)Employee shall be entitled to receive all bonuses and benefits as would have been awarded and/or paid under Sections 3.2 and 3.4 hereof through (or as a result of events occurring through) the Scheduled Termination Date, which benefits shall be awarded as and when the same would have been awarded under the Agreement had it not been terminated; and

(e)  All unvested stock options described in Exhibits B through C shall immediately vest.

(f) Except as provided in Article XI, this Agreement shall thereupon be of no further force or effect.

7.5 Termination Upon Change of Control. Upon a "Change of Control" (as such term is defined in Section 7.6 hereof) of the Company during the Term hereof, Employee may, at his sole discretion, declare this Agreement terminated and receive a one-time, lump sum severance payment equal to two (2) times the total amount of the annual base salary payable under the terms of Section 3.1 of this Agreement plus any incentive or bonus paid in the prior year pursuant to Section 3.2 of this Agreement and the Company and Board of Directors shall cause the following to occur;

(a)  All unvested stock options described in Exhibits B through C shall immediately vest.

7.6 Change of Control. For purposes of Section 7.5 of this Agreement, a Change of Control ("Change of Control") shall be deemed to have occurred in the event of:

(a)The acquisition by any person or entity, or group thereof acting in concert, of "beneficial" ownership (as such term is defined in Securities and Exchange Commission ("SEC") Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")), of securities of the Company which, together with securities previously owned, confer upon such person, entity or group the voting power, on any matters brought to a vote of shareholders, of thirty percent (30%) or more of the then outstanding shares of capital stock of the Company; or

(b)The sale, assignment or transfer of assets of the Company or any subsidiary or subsidiaries, in a transaction or series of transactions, if the aggregate consideration received or to be received by the Company or any such subsidiary in connection with such sale, assignment or transfer is greater than fifty percent (50%) of the book value, determined by the Company in accordance with generally accepted accounting principles, of the Company's assets determined on a consolidated basis immediately before such transaction or the first of such transactions; or

(c)The merger, consolidation, share exchange or reorganization of the Company (or one or more subsidiaries of the Company) as a result of which the holders of all of the shares of capital stock of the Company as a group would receive less than fifty percent (50%) of the voting power of the capital stock or other interests of the surviving or resulting corporation or entity; or

(d)The commencement (within the meaning of SEC Rule 14d-2 under the Exchange Act) of a tender or exchange offer which, if successful, would result in a Change of Control of the Company; or

(e)A determination by the Board of Directors of the Company, in view of then current circumstances or impending events, that a Change of Control of the Company has occurred or is imminent, which determination shall be made for the specific purpose of triggering the operative provisions of this Agreement; or

7.7.Certain Additional Payments by the Company.

(a) If it shall be determined that any payment, distribution or benefit received or to be received by Employee from the Company ("Payments") would be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then Employee shall be entitled to receive an additional payment (the "Excise Tax Gross-Up Payment) in an amount such that the net amount retained by Employee, after the calculation and deduction of any Excise Tax on the Payments and any federal, state and local income taxes and excise tax on the Excise Tax Gross-Up Payment provided for in this Section 7.7, shall be equal to the Payments. In determining this amount, the amount of the Excise Tax Gross-Up Payment attributable to federal income taxes shall be reduced by the maximum reduction in federal income taxes that could be obtained by the deduction of the portion of the Excise Tax Gross-Up Payment attributable to state and local income taxes. Finally, the Excise Tax Gross-Up Payment shall be reduced by income or excise tax withholding payments made by the Company or any affiliate of either to any federal, state or local taxing authority with respect to the Excise Tax Gross-Up Payment that was not deducted from compensation payable to Employee.

(b) All determinations required to be made under this Section 7.7, including whether and when an Excise Tax Gross-Up Payment is required and the amount of such Excise Tax Gross-Up Payment and the assumptions to be utilized in arriving at such determination, except as specified in Section 7.7(a) above, shall be made by the Company's independent auditors (the "Accounting Firm"), which shall provide detailed supporting calculations both to the Company and Employee within 15 business days after Employee provides the Company with notice that a Payment has been or will be made or such earlier time as may be required by the Company. The determination of tax liability made by the Accounting Firm shall be subject to review by the Employee's tax advisor and, if Employee's tax advisor does not agree with the determination reached by the Accounting Firm, then the Accounting Firm and Employee's tax advisor shall jointly designate a nationally recognized public accounting firm, which shall make the determination. All fees and expenses of the accountants and tax advisors retained by either Employee or the Company shall be borne by the Company. Any Excise Tax Gross-Up Payment, as determined pursuant to this Section 7.7, with respect to a Payment shall be paid by the Company to Employee at such time as Employee is entitled to receive the Payment. Any determination by a jointly designated public accounting firm shall be binding upon the Company and Employee.

(c) As a result of the uncertainty in the application of Subsection 4999 of the Code at the time of the initial determination hereunder, it is possible that Excise Tax Gross-Up Payments will not have been made by the Company that should have been made consistent with the calculations required to be made hereunder ("Underpayment"). In the event that Employee thereafter is required to make a payment of any Excise Tax, any such Underpayment calculated in accordance with and in the same manner as the Excise Tax Gross-Up Payment in Section 7.7(a) above shall be promptly paid by the Company to or for the benefit of Employee. In the event that the Excise Tax Gross-Up Payment exceeds the amount subsequently determined to be due, such excess shall constitute a loan from the Company to Employee payable on the fifth day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code).

ARTICLE VIII

Non-Competition and Non-Interference

8.1 Non-Competition. Employee agrees that during the Term hereof and, in the case of a Termination For Cause, for a period of two (2) years thereafter, Employee will not, directly, indirectly, or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity, own, manage, control, join, or participate in the ownership, management, operation, or control of, or be financially interested in or advise, lend money to, or be employed by or provide consulting services to (i) any person or entity seeking to provide the services or products which the Company provided or planned on providing as of the date of termination, or (ii) any person or entity to whom Employee provided services in any capacity on behalf of the Company, or (iii) any person or entity to whom Employee was introduced or about whom Employee received information through the Company and which person or entity is located within the United States of America; provided, however, that the foregoing restriction regarding financial interest shall not apply to ownership of less than 5% of the common equity of any entity whose common equity is registered under the Securities Exchange Act of 1934, as amended. 

8.2 Non-Interference. Employee agrees that during the Term hereof and, in the case of a Termination For Cause, for a period of two (2) years thereafter, Employee will not, directly or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity, retain or hire any person who was an employee of the Company while Employee was employed by the Company or to whom Employee was introduced or about whom Employee received information through the Company.

8.3 Severability. If any covenant or provision contained in this Article VIII is determined to be void or unenforceable in whole or in part, it shall not be deemed to affect or impair the validity of any other covenant or provision. If, in any arbitral or judicial proceeding, a tribunal shall refuse to enforce all of the separate covenants deemed included in this Article VIII, then such unenforceable covenants shall be deemed eliminated from the provisions hereof for the purpose of such proceedings to the extent necessary to permit the remaining separate covenants to be enforced in such proceedings.

ARTICLE IX

Remedies

9.1 Equitable Remedies. Employee and the Company agree that the services to be rendered by Employee pursuant to this Agreement, and the rights and interests granted and the obligations to be performed by Employee to the Company pursuant to this Agreement, are of a special, unique, extraordinary and intellectual character, which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any action at law, and that a breach by Employee of any of the terms of this Agreement will cause the Company great and irreparable injury and damage. Employee hereby expressly agrees that the Company shall be entitled to the remedies of injunction, specific performance and other equitable relief to prevent a breach of Articles VI and VIII of this Agreement, both pendente lite and permanently, against Employee, as such breach would cause irreparable injury to the Company and a remedy at law would be inadequate and insufficient. Therefore, the Company may, in addition to pursuing its other remedies, obtain an injunction from any court having jurisdiction in the matter restraining any further violation.

9.2 Rights and Remedies Preserved. Nothing in this Agreement except Section 10.11 shall limit any right or remedy the Company or Employee may have under this Agreement or pursuant to law for any breach of this Agreement by the other party. The rights granted to the parties herein are cumulative and the election of one shall not constitute a waiver of such party's right to assert all other legal remedies available under the circumstances.

ARTICLE X

Miscellaneous

10.1 No Waivers. The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.

10.2 Notices. Any notice to be given to the Company and Employee under the terms of this Agreement may be delivered in person, by telecopy, telex or other form of written electronic transmission, or by registered or certified mail, postage prepaid, and shall be addressed as follows:

If to the Company

Market Central, Inc.

7810 Ballantyne Commons Parkway

Suite 300

Charlotte, NC 28277

Attention: Chief Executive Officer

If to Employee

Clifford A. Clark

1712 Picadilly Lane

Raleigh, NC 27608

Either party may hereafter notify the other in writing of any change in address. Any notice shall be deemed duly given (i) when personally delivered, (ii) when telecopied, telexed or transmitted by other form of written electronic transmission (upon confirmation of receipt) or (iii) on the third day after it is mailed by registered or certified mail, postage prepaid, as provided herein.

10.3 Severability. The provisions of this Agreement are severable and if any provision of this Agreement shall be held to be invalid or otherwise unenforceable, in whole or in part, the remainder of the provisions, or enforceable parts thereof, shall not be affected thereby.

10.4 Successors and Assigns. The rights and obligations of the Company under this Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company, including the survivor upon any merger, consolidation, share exchange or combination of the Company with any other entity. Employee shall not have the right to assign, delegate or otherwise transfer any duty or obligation to be performed by him hereunder to any person or entity.

10.5 Entire Agreement. This Agreement supersedes any and all prior and contemporaneous agreements and understandings between the parties hereto, oral or written, and may not be modified or terminated orally. No modification, termination or attempted waiver shall be valid unless in writing, signed by the party against whom such modification, termination or waiver is sought to be enforced. This Agreement was the subject of negotiation by the parties hereto and their counsel. The parties agree that no prior drafts of this Agreement shall be admissible as evidence (whether in any arbitration or court of law) in any proceeding that involves the interpretation of any provisions of this Agreement.

10.6 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of North Carolina without reference to the conflict of law principles thereof.

10.7 Section Headings. The section headings contained herein are for the purposes of convenience only and are not intended to define or limit the contents of said sections.

10.8 Further Assurances. Each party hereto shall cooperate and shall take such further action and shall execute and deliver such further documents as may be reasonably requested by the other party in order to carry out the provisions and purposes of this Agreement.

10.9 Gender. Whenever the pronouns "he" or "his" are used herein they shall also be deemed to mean "she" or "hers" or "it" or "its" whenever applicable. Words in the singular shall be read and construed as though in the plural and words in the plural shall be read and construed as though in the singular in all cases where they would so apply.

10.10 Counterparts. This Agreement may be executed in counterparts, all of which taken together shall be deemed one original. 

10.11 Confidential Arbitration. The parties hereto agree that any dispute concerning or arising out of the provisions of this Agreement shall be resolved by confidential arbitration in accordance with the rules of the American Arbitration Association. Such confidential arbitration shall be held in Tampa, Florida, and the decision of the arbitrator(s) shall be conclusive and binding on the parties and shall be enforceable in any court of competent jurisdiction. The arbitrator may, in his or her discretion, award attorneys’ fees and costs to such party as he or she sees fit in rendering his or her decision. Notwithstanding the foregoing, if any dispute arises hereunder as to which the Company desires to exercise any rights or remedies under Section 9.1 hereof, the Company may, in its discretion, in lieu of submitting the matter to arbitration, bring an action thereon in any court of competent jurisdiction in Tampa, Florida, which court may grant any and all relief available in equity or at law. In any such action, the prevailing party shall be entitled to reasonable attorneys' fees and costs as may be awarded by the court.

ARTICLE XI

Survival

11.1 Survival. The provisions of Articles VI, VII, VIII, IX and X, of this Agreement shall survive the termination of this Agreement whether upon, or prior to, the Scheduled Termination Date hereof.

IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement as of the date first above written.

	Market Central Inc, Inc., a Delaware corporation
By:
	EMPLOYEE
	Clifford A. Clark

“Exhibit A”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on (the “Grant Date”) to Clifford A. Clark, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 125,000 shares (the “Shares”) of common stock, $0.001 par value per share, of the Company (“Common Stock”) at $1.60 per Share. Unless earlier terminated, this option shall expire on August 30, 2008 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

(a) General. Subject to the terms and conditions set forth in this Agreement, this option will become fully exercisable (“vested”) on the day of the date that this agreement is effective. Employee has four (4) years from the date of this agreement to exercise the options.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a) Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than three years after the Employee’s death the option shall be a non-qualified stock option.

(b) Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(f) Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph shall be as set forth above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Clifford A. Clark

“Exhibit B”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on (the “Grant Date”) to Clifford A. Clark, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 125,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.00 per Share. Unless earlier terminated, this option shall expire on August 30, 2010 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its ter

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

General.   These options will vest, subject to achieving the stock price goals shown below and at 25% per year on the anniversary date of this agreement unless price targets are achieved earlier   Vesting of these options shall occur upon occurrence of the following:

		Stock Price Target
Year 1	(during first year from commencement)	$2.25
Year 2		3.00
Year 3		3.75
Year 4		4.50

Stock price target is achieved when the average closing bid is at least the target price for 10 consecutive trading days during the respective year. Alternatively, theseoptions or any portion thereof shall immediately vest if the Company completes an underwriting of at least $5 million at or above the target price(s). Not achieving price goals in one year does not result in loss of the options, only that the ability to exercise is delayed, achieving any stock price target in a subsequent year results in all prior options being exercisable. Achieving a stock price target earlier than shown on the table above will result in immediate vesting and exerecisablity of those options in 50% of the time contemplated herein. An example is:

1)   If the stock price reaches $3.80 in the first year of the contract, then 75% of the options are fully vested and owned by the employee. All of them would be exercisable after 1.5 years rather than 3 years.

2)   If the stock price were to remain at $2.00 for three years and then move to $5.00 in year three, all of the options would be vested and exercisable immediately.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a) Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than three years after death the option shall be a non-qualified stock option.

(b) Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(c) Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Options shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph shall be as set forth above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE'S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Clifford A. Clark

“Exhibit C”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on (the “Grant Date”) to Clifford A. Clark, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 125,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.25 per Share. Unless earlier terminated, this option shall expire on August 30, 2010 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its ter

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

General. These options will vest, subject to achieving the stock price goals shown below and at 25% per year on the anniversary date of this agreement unless price targets are achieved earlier      Vesting of these options shall occur upon occurrence of the following:

		Stock Price Target
Year 1	(during first year from commencement)	$5.25
Year 2		6.00
Year 3		6.75
Year 4		7.50

Stock price target is achieved when the average closing bid is at least the target price for 10 consecutive trading days during the respective year. Alternatively, these options or any portion thereof shall immediately vest if the Company completes an underwriting of at least $5 million at or above the target price(s). ). Not achieving price goals in one year does not result in loss of the options, only that the ability to exercise is delayed, achieving any stock price target in a subsequent year results in all prior options being exercisable. Achieving a stock price target earlier than shown on the table above will result in immediate vesting and exerecisablity of those options in 50% of the time contemplated herein. An example is:

1)   If the stock price reaches $7.00 in the first year of the contract, then 75% of the options are fully vested and owned by the employee. All of them would be exercisable after 1.5 years rather than 3 years.

2)   If the stock price were to remain at $4.50 for three years and then move to $7.00 in year three, all of the options would be vested and exercisable immediately.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a) Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than three years after death the option shall be a non-qualified stock option.

(b) Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(c) Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph shall be as set forth above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature

EX-10.4

EXHIBIT 10.4

EMPLOYMENT AGREEMENT

BY AND BETWEEN

MARKET CENTRAL, INC.

AND

DOYAL BRYANT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as of October 8, 2004, by and between MARKET CENTRAL, INC., a Delaware corporation (the "Company"), and DOYAL BRYANT ("Employee").

WHEREAS, the Company and Employee desire to enter into this Agreement to assure the Company of the services of Employee and to set forth the respective rights and duties of the parties hereto;

WHEREAS, the Company will engage in the business of creating, managing, developing and licensing software and technology solutions (such activities, present and future, being hereinafter referred to as the "Business");

NOW, THEREFORE, in consideration of the premises and the mutual covenants, terms and conditions set forth herein, the Company and Employee agree as follows:

ARTICLE I

Employment

1.1 Employment and Title. The Company hereby employs Employee, and Employee hereby accepts such employment, as Chief Executive Officer of the Company, all upon the terms and conditions set forth herein.

1.2 Services. During the Term (as hereinafter defined) hereof, Employee agrees to perform diligently and in good faith the duties of the Chief Executive Officer of the Company, under the direction of Board of Directors. Employee agrees to devote his best efforts and all of his full business time, energies and abilities to the services to be performed hereunder and for the exclusive benefit of the Company. Employee shall be vested with such authority as is generally commensurate with the position of Chief Executive Officer of the Company, as further outlined below.

1.3 Location. The principal place of employment and the location of Employee's principal office shall be in Charlotte, North Carolina; provided, however, Employee shall undertake all requisite travel in the performance of his duties under this Agreement.

1.4 Representations. Each party represents and warrants to the other that he/it has full power and authority to enter into and perform this Agreement and that his/its execution and performance of this Agreement shall not constitute a default under or breach of any of the terms of any agreement to which he/it is a party or under which he/it is bound. Each party represents that no consent or approval of any third party is required for his/its execution, delivery and performance of this Agreement or that all consents or approvals of any third party required for his/its execution, delivery and performance of this Agreement have been obtained. 

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1.5 Sole Discretion. As the term "sole discretion" is used in this Agreement, unless otherwise defined, it will be interpreted as the exercise of reasonable discretion applying normal business practices to a contractual relationship between a company and its senior vice president and chief technology officer.

ARTICLE II

Term

2.1 Term. The term of Employee's employment hereunder (the "Term") shall commence as of October 8, 2004 (the "Commencement Date") and shall continue through the third anniversary of the Commencement Date (the "Scheduled Termination Date"), unless earlier terminated pursuant to the provisions of this Agreement. This Agreement shall automatically renew for an unlimited number of successive one-year terms unless either party shall deliver written notice of non-renewal at least ninety (90) days prior to the Scheduled Termination Date (or the Scheduled Termination Date of any renewal term).

ARTICLE III

Compensation

3.1 Base Salary. As compensation for the services to be rendered by Employee, the Company shall pay Employee, during the Term of this Agreement, an annual base salary of not less than One Hundred Eighty Thousand Dollars ($180,000), which base salary shall accrue monthly (prorated for periods less than a month) and shall be paid in equal semi-monthly installments, in arrears unless the Board deems the companies profit unable to support. The base salary will be reviewed annually, or, more frequently, as appropriate, by the Board of Directors or the Compensation Committee of the Board of Directors, as the case. 

3.2 Bonus Compensation. Employee shall be eligible to receive bonus or incentive compensation, equaling 2.5 times his annual salary based on meeting quarterly goals and objectives established by the board which may be granted from time to time in the sole discretion of the Board of Directors in accordance with the Company's compensation structure in effect from time to time. 

3.3 Stock Options.As an incentive to use consistent and best efforts solely on behalf of Market Central, employee will be provided stock options. Stock Option Agreements are attached as Exhibits “A” through “D”. It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated. 

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3.4 Employee's Legal Fees. Employee may, and the Company has encouraged the Employee to, engage competent independent legal counsel for advice and guidance with respect to this Agreement, including, without limitation, advice as to the federal income tax consequences of this Article III. The Company shall reimburse Employee for all reasonable legal fees incurred by Employee in connection with the negotiation and execution of this Agreement.

3.5 Benefits. Employee shall be entitled, during the Term hereof, to the same medical, hospital, dental, health club and life insurance coverage and benefits as are then available to the Company's most senior executive officers. As an Employee of the Company and its chief executive officer, Employee may be provided additional benefits as decided by the Board.

3.6 Withholding. Any and all amounts payable under this Agreement, including, without limitation, amounts payable under this Article III and Article VII, are subject to withholding for such federal, state and local taxes required pursuant to any applicable law, rule or regulation.

ARTICLE IV

Working Facilities, Expenses and Insurance

4.1 Working Facilities and Expenses. Employee shall be furnished with an office at the Employee's principal office as set forth in Section 1.3 hereof, or at such other location as agreed to by Employee and the Company, and other working facilities and secretarial and other assistance suitable to his position and reasonably required for the performance of his duties hereunder. The Company shall reimburse Employee for all of Employee's reasonable expenses incurred while employed and performing his duties under and in accordance with the terms and conditions of this Agreement, subject to Employee's full and appropriate documentation, including, without limitation, receipts for all such expenses in the manner required pursuant to Company's policies and procedures and the Internal Revenue Code of 1986, as amended (the "Code"), and applicable regulations in effect from time to time.

4.2 Insurance. The Company may secure in its own name or otherwise, and at its own expense, life, disability and other insurance covering Employee or Employee and others, and Employee shall not have any right, title or interest in or to such insurance other than as expressly provided herein. Employee agrees to assist the Company in procuring such insurance by submitting to the usual and customary medical and other examinations to be conducted by such physicians(s) as the Company or such insurance company may designate and by signing such applications and other written instruments as may be required by any insurance company to which application is made for such insurance. Any information provided by Employee to such insurance company (the results of examinations being deemed part of such information) will be provided on a confidential basis, and the Company shall have no access thereto.

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ARTICLE V

Illness or Incapacity

5.1 Right to Terminate. If, during the Term of this Agreement, Employee shall be unable to perform, with or without a reasonable accommodation, in all material respects the essential duties of his employment hereunder for a period exceeding six (6) consecutive months by reason of illness or incapacity, this Agreement may be terminated by the Company in its sole discretion pursuant to Section 7.2 hereof.

5.2 Right to Replace. If Employee's illness or incapacity, whether by physical or mental cause, renders him unable for a minimum period of thirty (30) consecutive calendar days to carry out his duties and responsibilities as set forth herein, the Company shall have the right to designate a person to temporarily perform Employee's duties; provided, however, that if Employee returns to work from such illness or incapacity within the six (6) month period following his inability due to such illness or incapacity, he shall be entitled to be reinstated in the capacity described in Article I hereof with all rights, duties and privileges attendant thereto.

5.3 Rights Prior to Termination. Employee shall be entitled to his full base salary under Section 3.1 hereof and full benefits under Section 3.4 hereof during such illness or incapacity unless and until an election is made by the Company to terminate this Agreement in accordance with the provisions of this Article V.

5.4 Determination of Illness or Incapacity. For purposes of this Article V, the term "illness or incapacity" shall mean Employee's inability to perform his duties hereunder substantially on a full-time basis due to physical or mental illness as determined by the Board of Directors, in its reasonable discretion based upon competent medical evidence. Upon the Company's written request, Employee shall submit to reasonable medical and other examinations to provide the evidence required hereunder.

ARTICLE VI

Confidentiality

6.1 Confidentiality. During the Term of this Agreement and for a period of five (5) years thereafter, Employee agrees to maintain the confidential nature of the Company's confidential and proprietary trade secrets, including, without limitation, development ideas, acquisition strategies and plans, financial information, records, "know-how", methods of doing business, customer, supplier and distributor lists and all other confidential information of the Company. Employee shall not use (other than in connection with his employment), in any way whatsoever, such trade secrets except as authorized in writing by the Company. Employee shall, upon the termination of his employment, deliver to the Company any and all records, books, documents or any other materials whatsoever (including all copies thereof) containing such trade secrets that shall be and remain the property of the Company.

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6.2 Non-Removal of Records. All documents, papers, materials, notes, books, correspondence, drawings and other written, graphic and electronic records of the Business of the Company which Employee shall prepare or use, or come into contact with, shall be and remain the sole property of the Company and, effective immediately upon the termination of the Employee's employment with the Company for any reason, shall not be removed from the Company's premises without the Company's prior written consent.

ARTICLE VII

Termination

7.1 Termination For Cause. This Agreement and the employment of Employee may be terminated by the Company "For Cause" upon the determination of not less than 75% of the members of the Board of Directors of the Company (the “Super Majority”), , in any of the following circumstances:

(a)Employee has committed any fraud, dishonesty, misappropriation or similar wrongful act against the Company; or

(b)Employee is in default in a material respect in the performance of Employee's obligations, services or duties hereunder, which shall include, without limitation, Employee's willfully disregarding the written instructions of the Board of Directors of the Company concerning the conduct of his duties hereunder, Employee's conduct which, after written notice and an opportunity to cure, is materially inconsistent with the published policies of the Company, as promulgated from time to time and which are generally applicable to all employees and/or senior executives, or Employee's breach of any other material provision of this Agreement; or

(c)Employee is grossly negligent or engages in willful misconduct in the performance of his duties hereunder; or

(d)Employee has been adjudicated guilty by, or enters a plea of guilty or no contest before, a court of competent jurisdiction of illegal activities or found by a court of competent jurisdiction to have engaged in other wrongful conduct which individually, or in the aggregate, has a material adverse effect on the Company, its prospects, earnings or financial condition, other than minor traffic infractions.

A Termination For Cause under this Section 7.1 shall be effective upon the date set forth in a written notice of termination delivered to Employee.

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7.2 Termination Without Cause. This Agreement and the employment of the Employee may be terminated "Without Cause" as follows:

(a)By mutual agreement of the parties hereto; or

(b)At the election of the Company by its giving not less than thirty (30) days' written notice to Employee in the event of an illness or incapacity described in Section 5.1; or

(c)Upon Employee's death.

A Termination Without Cause under Sections 7.2(b) and (c) hereof shall be effective upon the date set forth in a written notice of termination or resignation delivered hereunder, which shall be not less than thirty (30) days nor more than forty-five (45) days after the giving of such notice.

7.3 Effect of Termination For Cause. If Employee's employment is terminated For Cause:

(a)Employee shall be entitled to accrued base salary under Section 3.1 and accrued vacation pay, each through the date of termination;

(b)Employee shall be entitled to reimbursement for expenses accrued through the date of termination in accordance with the provisions of Section 4.1 hereof; and

(c)Except as provided in Article XI, this Agreement shall thereupon be of no further force and effect.

7.4 Effect of Termination Without Cause. If Employee's employment is terminated Without Cause:

(a)Employee shall be entitled to accrued base salary under Section 3.1 and accrued vacation pay, each through the date of termination;

(b)Employee shall be entitled to reimbursement for expenses accrued through the date of termination in accordance with the provisions of Section 4.1 hereof;

(c)Employee shall be entitled to receive base salary payable under Section 3.1 remaining in the then current term; plus no less than nine (9) months severance.

(d)Employee shall be entitled to receive all bonuses and benefits as would have been awarded and/or paid under Sections 3.2 and 3.4 hereof through (or as a result of events occurring through) the Scheduled Termination Date, which benefits shall be awarded as and when the same would have been awarded under the Agreement had it not been terminated; and

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(e)Except as provided in Article XI, this Agreement shall thereupon be of no further force or effect.

(f)       All unvested stock options described in Exhibits A through D shall immediately vest.

7.5 Termination Upon Change of Control. Upon a "Change of Control" (as such term is defined in Section 7.6 hereof) of the Company during the Term hereof, Employee may, at his sole discretion, declare this Agreement terminated and receive a one-time, lump sum severance payment equal to two (2) times the total amount of the annual base salary payable under the terms of Section 3.1 of this Agreement plus any incentive or bonus paid in the prior year pursuant to Section 3.2 of this Agreement and the Company and Board of Directors shall cause the following to occur;

(a)  All unvested stock options described in Exhibits B through D shall immediately vest

7.6 Change of Control. For purposes of Section 7.5 of this Agreement, a Change of Control ("Change of Control") shall be deemed to have occurred in the event of:

(a)The acquisition by any person or entity, or group thereof acting in concert, of "beneficial" ownership (as such term is defined in Securities and Exchange Commission ("SEC") Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), of securities of the Company which, together with securities previously owned, confer upon such person, entity or group the voting power, on any matters brought to a vote of shareholders, of thirty percent (30%) or more of the then outstanding shares of capital stock of the Company; or

(b)The sale, assignment or transfer of assets of the Company or any subsidiary or subsidiaries, in a transaction or series of transactions, if the aggregate consideration received or to be received by the Company or any such subsidiary in connection with such sale, assignment or transfer is greater than fifty percent (50%) of the book value, determined by the Company in accordance with generally accepted accounting principles, of the Company's assets determined on a consolidated basis immediately before such transaction or the first of such transactions; or

(c)The merger, consolidation, share exchange or reorganization of the Company (or one or more subsidiaries of the Company) as a result of which the holders of all of the shares of capital stock of the Company as a group would receive less than fifty percent (50%) of the voting power of the capital stock or other interests of the surviving or resulting corporation or entity; or

(d)The commencement (within the meaning of SEC Rule 14d-2 under the Exchange Act) of a tender or exchange offer which, if successful, would result in a Change of Control of the Company; or

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(e)A determination by the Board of Directors of the Company, in view of then current circumstances or impending events, that a Change of Control of the Company has occurred or is imminent, which determination shall be made for the specific purpose of triggering the operative provisions of this Agreement; or

7.7.Certain Additional Payments by the Company.

(a) If it shall be determined that any payment, distribution or benefit received or to be received by Employee from the Company ("Payments") would be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then Employee shall be entitled to receive an additional payment (the "Excise Tax Gross-Up Payment) in an amount such that the net amount retained by Employee, after the calculation and deduction of any Excise Tax on the Payments and any federal, state and local income taxes and excise tax on the Excise Tax Gross-Up Payment provided for in this Section 7.7, shall be equal to the Payments. In determining this amount, the amount of the Excise Tax Gross-Up Payment attributable to federal income taxes shall be reduced by the maximum reduction in federal income taxes that could be obtained by the deduction of the portion of the Excise Tax Gross-Up Payment attributable to state and local income taxes. Finally, the Excise Tax Gross-Up Payment shall be reduced by income or excise tax withholding payments made by the Company or any affiliate of either to any federal, state or local taxing authority with respect to the Excise Tax Gross-Up Payment that was not deducted from compensation payable to Employee.

(b) All determinations required to be made under this Section 7.7, including whether and when an Excise Tax Gross-Up Payment is required and the amount of such Excise Tax Gross-Up Payment and the assumptions to be utilized in arriving at such determination, except as specified in Section 7.7(a) above, shall be made by the Company's independent auditors (the "Accounting Firm"), which shall provide detailed supporting calculations both to the Company and Employee within fifteen (15) business days after Employee provides the Company with notice that a Payment has been or will be made or such earlier time as may be required by the Company. The determination of tax liability made by the Accounting Firm shall be subject to review by the Employee's tax advisor and, if Employee's tax advisor does not agree with the determination reached by the Accounting Firm, then the Accounting Firm and Employee's tax advisor shall jointly designate a nationally recognized public accounting firm, which shall make the determination. All fees and expenses of the accountants and tax advisors retained by either Employee or the Company shall be borne by the Company. Any Excise Tax Gross-Up Payment, as determined pursuant to this Section 7.7, with respect to a Payment shall be paid by the Company to Employee at such time as Employee is entitled to receive the Payment. Any determination by a jointly designated public accounting firm shall be binding upon the Company and Employee.

(c) As a result of the uncertainty in the application of Subsection 4999 of the Code at the time of the initial determination hereunder, it is possible that Excise Tax Gross-Up Payments will not have been made by the Company that should have been made consistent with the calculations required to be made hereunder ("Underpayment"). In the event that Employee thereafter is required to make a payment of any Excise Tax, any such Underpayment calculated in accordance with and in the same manner as the Excise Tax Gross-Up Payment in Section 7.7(a) above shall be promptly paid by the Company to or for the benefit of Employee. In the event that the Excise Tax Gross-Up Payment exceeds the amount subsequently determined to be due, such excess shall constitute a loan from the Company to Employee payable on the fifth day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code).

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ARTICLE VIII

Non-Competition and Non-Interference

8.1 Non-Competition. Employee agrees that during the Term hereof and, in the case of a Termination For Cause, for a period of two (2) years thereafter, Employee will not, directly, indirectly, or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity, own, manage, control, join, or participate in the ownership, management, operation, or control of, or be financially interested in or advise, lend money to, or be employed by or provide consulting services to (i) any person or entity seeking to provide the services or products which the Company provided or planned on providing as of the date of termination, or (ii) any person or entity to whom Employee provided services in any capacity on behalf of the Company, or (iii) any person or entity to whom Employee was introduced or about whom Employee received information through the Company and which person or entity is located within the United States of America; provided, however, that the foregoing restriction regarding financial interest shall not apply to ownership of less than 5% of the common equity of any entity whose common equity is registered under the Securities Exchange Act of 1934, as amended. 

8.2 Non-Interference. Employee agrees that during the Term hereof and, in the case of a Termination For Cause, for a period of two (2) years thereafter, Employee will not, directly or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity, retain or hire any person who was an employee of the Company while Employee was employed by the Company or to whom Employee was introduced or about whom Employee received information through the Company.

8.3 Severability. If any covenant or provision contained in this Article VIII is determined to be void or unenforceable in whole or in part, it shall not be deemed to affect or impair the validity of any other covenant or provision. If, in any arbitral or judicial proceeding, a tribunal shall refuse to enforce all of the separate covenants deemed included in this Article VIII, then such unenforceable covenants shall be deemed eliminated from the provisions hereof for the purpose of such proceedings to the extent necessary to permit the remaining separate covenants to be enforced in such proceedings.

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ARTICLE IX

Remedies

9.1 Equitable Remedies. Employee and the Company agree that the services to be rendered by Employee pursuant to this Agreement, and the rights and interests granted and the obligations to be performed by Employee to the Company pursuant to this Agreement, are of a special, unique, extraordinary and intellectual character, which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any action at law, and that a breach by Employee of any of the terms of this Agreement will cause the Company great and irreparable injury and damage. Employee hereby expressly agrees that the Company shall be entitled to the remedies of injunction, specific performance and other equitable relief to prevent a breach of Articles VI and VIII of this Agreement, both pendente lite and permanently, against Employee, as such breach would cause irreparable injury to the Company and a remedy at law would be inadequate and insufficient. Therefore, the Company may, in addition to pursuing its other remedies, obtain an injunction from any court having jurisdiction in the matter restraining any further violation.

9.2 Rights and Remedies Preserved. Nothing in this Agreement except Section 10.11 shall limit any right or remedy the Company or Employee may have under this Agreement or pursuant to law for any breach of this Agreement by the other party. The rights granted to the parties herein are cumulative and the election of one shall not constitute a waiver of such party's right to assert all other legal remedies available under the circumstances.

ARTICLE X

Miscellaneous

10.1 No Waivers. The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.

10.2 Notices. Any notice to be given to the Company and Employee under the terms of this Agreement may be delivered in person, by telecopy, telex or other form of written electronic transmission, or by registered or certified mail, postage prepaid, and shall be addressed as follows:

If to the Company

Market Central

Attention: Chairman of Board

If to Employee

Doyal Bryant

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Either party may hereafter notify the other in writing of any change in address. Any notice shall be deemed duly given (i) when personally delivered, (ii) when telecopied, telexed or transmitted by other form of written electronic transmission (upon confirmation of receipt) or (iii) on the third day after it is mailed by registered or certified mail, postage prepaid, as provided herein.

10.3 Severability. The provisions of this Agreement are severable and if any provision of this Agreement shall be held to be invalid or otherwise unenforceable, in whole or in part, the remainder of the provisions, or enforceable parts thereof, shall not be affected thereby.

10.4 Successors and Assigns. The rights and obligations of the Company under this Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company, including the survivor upon any merger, consolidation, share exchange or combination of the Company with any other entity. Employee shall not have the right to assign, delegate or otherwise transfer any duty or obligation to be performed by him hereunder to any person or entity.

10.5 Entire Agreement. This Agreement supersedes any and all prior and contemporaneous agreements and understandings between the parties hereto, oral Or written, and may not be modified or terminated orally. No modification, termination or attempted waiver shall be valid unless in writing, signed by the party against whom such modification, termination or waiver is sought to be enforced. This Agreement was the subject of negotiation by the parties hereto and their counsel. The parties agree that no prior drafts of this Agreement shall be admissible as evidence (whether in any arbitration or court of law) in any proceeding that involves the interpretation of any provisions of this Agreement.

10.6 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of North Carolina without reference to the conflict of law principles thereof.

10.7 Section Headings. The section headings contained herein are for the purposes of convenience only and are not intended to define or limit the contents of said sections.

10.8 Further Assurances. Each party hereto shall cooperate and shall take such further action and shall execute and deliver such further documents as may be reasonably requested by the other party in order to carry out the provisions and purposes of this Agreement.

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10.9 Gender. Whenever the pronouns "he" or "his" are used herein they shall also be deemed to mean "she" or "hers" or "it" or "its" whenever applicable. Words in the singular shall be read and construed as though in the plural and words in the plural shall be read and construed as though in the singular in all cases where they would so apply.

10.10 Counterparts. This Agreement may be executed in counterparts, all of which taken together shall be deemed one original. 

10.11 Confidential Arbitration. The parties hereto agree that any dispute concerning or arising out of the provisions of this Agreement shall be resolved by confidential arbitration in accordance with the rules of the American Arbitration Association. Such confidential arbitration shall be held in Tampa, Florida, and the decision of the arbitrator(s) shall be conclusive and binding on the parties and shall be enforceable in any court of competent jurisdiction. The arbitrator may, in his or her discretion, award attorneys’ fees and costs to such party as he or she sees fit in rendering his or her decision. Notwithstanding the foregoing, if any dispute arises hereunder as to which the Company desires to exercise any rights or remedies under Section 9.1 hereof, the Company may, in its discretion, in lieu of submitting the matter to arbitration, bring an action thereon in any court of competent jurisdiction in Tampa, Florida, which court may grant any and all relief available in equity or at law. In any such action, the prevailing party shall be entitled to reasonable attorneys' fees and costs as may be awarded by the court.

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ARTICLE XI

Survival

11.1 Survival. The provisions of Articles VI, VII, VIII, IX and X, of this Agreement shall survive the termination of this Agreement whether upon, or prior to, the Scheduled Termination Date hereof.

IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement as of the date first above written.

Market Central Inc, INC.,

a Delaware corporation

By:  

EMPLOYEE
	Doyal Bryant

 

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“Exhibit A”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on October 8, 2004 (the “Grant Date”) to Doyal Bryant, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 1,000,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $1.60 per Share. Unless earlier terminated, this option shall expire on October 8, 2008 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

(a)   General. Subject to the terms and conditions set forth in this Agreement, this option will become fully exercisable (“vested”) on the day of the closing. Employee has four (4) years from the date of the closing to purchase the options.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(b)   Continuous Relationship with the Company Required. Except as otherwise provided in this Section 3, this option may not be exercised unless the Employee, at the time he or she exercises this option, is, and has been at all times since the Grant Date, an employee, officer or director of, or consultant or advisor to, the Company or any parent or subsidiary of the Company.

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(c)   Termination of Relationship with the Company. If the Employee ceases to be an Eligible Employee for any reason, then, except as provided in paragraphs (d) and (e) below, the right to exercise this option shall terminate three months after such cessation (but in no event after the Final Exercise Date), provided that (i) this option shall be exercisable only to the extent that the Employee was entitled to exercise this option on the date of such cessation, and (ii) to the extent that the option or any portion thereof is exercised at any time later than three months after the date that the Employee ceases to be an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option. Notwithstanding the foregoing, if the Employee, prior to the Final Exercise Date, violates the non-competition or confidentiality provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Employee and the Company, the right to exercise this option shall terminate immediately upon such violation.

(d)   Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of one year following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than one year after the Employee’s termination as an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option.

(e)   Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(f)   Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph (f) shall be as set forth in paragraph (c) above.

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4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

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IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Doyal Bryant

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“Exhibit B”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on October 8, 2004 (the “Grant Date”) to Doyal Bryant, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 1,000,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.00 per Share. Unless earlier terminated, this option shall expire on October 8, 2010 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

General.   These options will vest, subject to achieving the stock price goals shown below and at 25% per year on the anniversary date of this agreement unless price targets are achieved earlier   Vesting of these options shall occur upon occurrence of the following:

		Stock PriceTarget
Year 1	(during first year from commencement)	$2.25
Year 2		3.00
Year 3		3.75
Year 4		4.50

Stock price target is achieved when the average closing bid is at least the target price for 10 consecutive trading days during the respective year. Alternatively, theseoptions or any portion thereof shall immediately vest if the Company completes an underwriting of at least $5 million at or above the target price(s). Not achieving price goals in one year does not result in loss of the options, only that the ability to exercise is delayed, achieving any stock price target in a subsequent year results in all prior options being exercisable. Achieving a stock price target earlier than shown on the table above will result in immediate vesting and exerecisablity of those options in 50% of the time contemplated herein. An example is:

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1)   If the stock price reaches $3.80 in the first year of the contract, then 75% of the options are fully vested and owned by the employee. All of them would be exercisable after 1.5 years rather than 3 years.

2)   If the stock price were to remain at $2.00 for three years and then move to $5.00 in year three, all of the options would be vested and exercisable immediately.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a)   Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than three years death the option shall be a non-qualified stock option.

(b)   Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(c)   Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph (f) shall be as set forth in paragraph (c) above.

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4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

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IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Doyal Bryant

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“Exhibit C”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on October 8, 2004 (the “Grant Date”) to Doyal Bryant, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 1,000,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.25 per Share. Unless earlier terminated, this option shall expire onOctober 8, 2010 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

(a) General. These options will vest, subject to achieving the stock price goals shown below and at 25% per year on the anniversary date of this agreement unless price targets are achieved earlier Vesting of these options shall occur upon occurrence of the following:

	Stock PriceTarget
Year 1 (during first year from commencement)	$5.25
Year 2	6.00
Year 3	6.75
Year 4	7.50

Stock price target is achieved when the average closing bid is at least the target price for 10 consecutive trading days during the respective year. Alternatively, these options or any portion thereof shall immediately vest if the Company completes an underwriting of at least $5 million at or above the target price(s). Not achieving price goals in one year does not result in loss of the options, only that the ability to exercise is delayed, achieving any stock price target in a subsequent year results in all prior options being exercisable. Achieving a stock price target earlier than shown on the table above will result in immediate vesting and exercisablity of those options in 50% of the time contemplated herein. An example is:

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1)   If the stock price reaches $7.00 in the first year of the contract, then 75% of the options are fully vested and owned by the employee. All of them would be exercisable after 1.5 years rather than 3 years.

2)   If the stock price were to remain at $4.50 for three years and then move to $7.00 in year three, all of the options would be vested and exercisable immediately.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a)   Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of one year following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than three years after the Employee’s death the option shall be a non-qualified stock option.

(b)   Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(c)   Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Options shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph (f) shall be as set forth in paragraph (c) above.

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4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

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IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Doyal Bryant

25

“Exhibit D”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on October 8, 2004 (the “Grant Date”) to Doyal Bryant, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 1,000,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.50 per Share. Unless earlier terminated, this option shall expire onOctober 8, 2010 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

(a)   General. This option shall become available to Employee on the day that the stock of the Company is traded @ $10.00 per share for ten consecutive trading days. These amounts shall be adjusted for stock splits and stock dividends.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a)   Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than three years after the Employee’s death , the option shall be a non-qualified stock option.

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(b)   Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(c)   Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph (f) shall be as set forth in paragraph (c) above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

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IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Doyal Bryant

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EX-10.5

EMPLOYMENT AGREEMENT

BY AND BETWEEN

MARKET CENTRAL, INC.

AND

PAUL ODOM

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into effective January 15, 2005, by and between MARKET CENTRAL, INC., a Delaware corporation (the "Company"), and PAUL ODOM ("Employee").

WHEREAS, the Company and Employee desire to enter into this Agreement to assure the Company of the services of Employee and to set forth the respective rights and duties of the parties hereto;

WHEREAS, the Company will engage in the business of creating, managing, developing and licensing software and technology solutions and any other lawful activities (such activities, present and future, being hereinafter referred to as the "Business");

NOW, THEREFORE, in consideration of the premises and the mutual covenants, terms and conditions set forth herein, the Company and Employee agree as follows:

ARTICLE I

Employment

1.1 Employment and Title. The Company hereby employs Employee, and Employee hereby accepts such employment, as Senior V.P.-Software Applications and Solutions of the Company, all upon the terms and conditions set forth herein.

1.2 Services. During the Term (as hereinafter defined) hereof, Employee agrees to perform diligently and in good faith the duties of the Senior V.P.-Software Applications and Solutions of the Company, under the direction of the CEO and Board of Directors. Employee agrees to devote his best efforts and a substantial amount of his business time, energies and abilities to the services to be performed hereunder and for the benefit of the Company. Employee shall be vested with such authority as is generally commensurate with the position of Senior V.P Software Applications and Solutions of the Company.

1.3 Location. The principal place of employment and the location of Employee's principal office shall initially be in Houston, Texas but will likely be relocated to Charlotte, North Carolina at the company’s expense and Employee shall undertake all requisite travel in the performance of his duties under this Agreement.

1.4 Representations. Each party represents and warrants to the other that he/it has full power and authority to enter into and perform this Agreement and that his/its execution and performance of this Agreement shall not constitute a default under or breach of any of the terms of any agreement to which he/it is a party or under which he/it is bound. Each party represents that no consent or approval of any third party is required for his/its execution, delivery and performance of this Agreement or that all consents or approvals of any third party required for his/its execution, delivery and performance of this Agreement have been obtained. 

1.5 Sole Discretion. As the term "sole discretion" is used in this Agreement, unless otherwise defined, it will be interpreted as the exercise of reasonable good faith discretion applying normal business practices to a contractual relationship between a company and its senior executives.

ARTICLE II

Term

2.1 Term. The term of Employee's employment hereunder (the "Term") shall commence as of January 15, 2005 (the "Commencement Date") and shall continue through the fourth anniversary of the Commencement Date (the "Scheduled Termination Date"), unless earlier terminated pursuant to the provisions of this Agreement. This Agreement shall automatically renew for an unlimited number of successive one-year terms unless either party shall deliver written notice of non-renewal at least ninety (90) days prior to the Scheduled Termination Date (or the Scheduled Termination Date of any renewal term).

ARTICLE III

Compensation

3.1 Base Salary. As compensation for the services to be rendered by Employee, the Company shall pay Employee, during the Term of this Agreement, an annual base salary of not less than One Hundred Twenty Thousand Dollars ($120,000) through July 15, 2005 and not less than One Hundred Fifty Thousand Dollars ($150,000) thereafter, which base salary shall accrue monthly (prorated for periods less than a month) and shall be paid in equal semi-monthly installments. The base salary will be reviewed annually, or, more frequently, as appropriate, by the Board of Directors or the Compensation Committee of the Board of Directors, as the case may be, for upward, but not downward, adjustment in its sole discretion. In the event that the Employee and the Board of Directors determine that financial conditions necessitate the deferral of all or a portion of this base salary, Employee shall receive common stock purchase warrants in the amount equal to the deferred salary for the preceding month. This amount shall be determined on the first day of each month by dividing the salary deferred during the immediately preceding month by 75% of the closing bid price of one share of common stock. This quotient shall be the number of shares employee will receive on that month’s warrant. The exercise price of the warrant shall be 75% of the closing bid price as used in the calculation and the warrant shall have a four (4) year life. The salary so defined shall be paid as promptly as possible and in no event later than the date such deferred salary was initially earned and payable.

3.2 Bonus Compensation. Employee shall be eligible to receive bonus or incentive compensation, which may be granted from time to time in the sole discretion of the CEO or Board of Directors in accordance with the Company's compensation structure in effect from time to time.

3.3 Stock Options.As an incentive to use consistent and best efforts on behalf of Market Central, employee will be provided stock options. These Stock Option Agreements are attached as Exhibits “A” through “C”. It is intended that the options evidenced by this agreement shall, to the extent they so qualify, be incentive stock options as defined in Section 422 of the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder. 

3.4 Employee's Legal Fees. Employee may, and the Company has encouraged the Employee to, engage competent independent legal counsel for advice and guidance with respect to this Agreement, including, without limitation, advice as to the federal income tax consequences of this Article III. The Employee shall be responsible for all reasonable legal fees incurred by Employee in connection with the negotiation and execution of this Agreement.

3.5 Benefits. Employee shall be entitled, during the Term hereof, to the same medical, hospital, dental, health club and life insurance coverage and benefits as are then available to the Company's most senior executive officers, together with the following additional benefits:

(a)Comprehensive medical coverage, including dependent coverage, paid fully by the Company;

(b)Life insurance in an amount equal to two times Employee's base salary;

(c)Long-term disability insurance in an amount, adjusted annually, equal to two-thirds of Employee's prior year base salary and incentive compensation, if any, excluding compensation earned through Company stock options or other securities; and

(d)The Company's normal vacation allowance for all employees who are executive officers of the Company.

3.Withholding. Any and all amounts payable under this Agreement, including, without limitation, amounts payable under this Article III and Article VII, are subject to withholding for such federal, state and local taxes required pursuant to any applicable law, rule or regulation.

ARTICLE IV

Working Facilities, Expenses and Insurance

4.1 Working Facilities and Expenses. Employee shall be furnished with an office at the Employee's principal office as set forth in Section 1.3 hereof, or at such other location as agreed to by Employee and the Company, and other working facilities and secretarial and other assistance suitable to his position and reasonably required for the performance of his duties hereunder. The Company shall reimburse Employee for all of Employee's reasonable expenses incurred while employed and performing his duties under and in accordance with the terms and conditions of this Agreement, subject to Employee's full and appropriate documentation, including, without limitation, receipts for all such expenses in the manner required pursuant to Company's policies and procedures and the Internal Revenue Code of 1986, as amended (the "Code"), and applicable regulations in effect from time to time.

4.2 Insurance. The Company may secure in its own name or otherwise, and at its own expense, life, disability and other insurance covering Employee or Employee and others, and Employee shall not have any right, title or interest in or to such insurance other than as expressly provided herein. Employee agrees to assist the Company in procuring such insurance by submitting to the usual and customary medical and other examinations to be conducted by such physicians(s) as the Company or such insurance company may designate and by signing such applications and other written instruments as may be required by any insurance company to which application is made for such insurance. Any information provided by Employee to such insurance company (the results of examinations being deemed part of such information) will be provided on a confidential basis, and the Company shall have no access thereto.

ARTICLE V

Illness or Incapacity

5.1 Right to Terminate. If, during the Term of this Agreement, Employee shall be unable to perform, with or without a reasonable accommodation, in all material respects the essential duties of his employment hereunder for a period exceeding six (6) consecutive months by reason of illness or incapacity, this Agreement may be terminated by the Company in its sole discretion pursuant to Section 7.2 hereof.

5.2 Right to Replace. If Employee's illness or incapacity, whether by physical or mental cause, renders him unable for a minimum period of thirty (30) consecutive calendar days to carry out his duties and responsibilities as set forth herein, the Company shall have the right to designate a person to temporarily perform Employee's duties; provided, however, that if Employee returns to work from such illness or incapacity within the six (6) month period following his inability due to such illness or incapacity, he shall be entitled to be reinstated in the capacity described in Article I hereof with all rights, duties and privileges attendant thereto.

5.3 Rights Prior to Termination. Employee shall be entitled to his full base salary under Section 3.1 hereof and full benefits under Section 3.4 hereof during such illness or incapacity described in Section 5.2 unless and until an election is made by the Company to terminate this Agreement in accordance with the provisions of this Article V.

5.4 Determination of Illness or Incapacity. For purposes of this Article V, the term "illness or incapacity" shall mean Employee's inability to perform his duties hereunder substantially on a full-time basis due to physical or mental illness as determined by the Board of Directors, in its reasonable discretion based upon competent medical evidence. Upon the Company's written request, Employee shall submit to reasonable medical and other examinations to provide the evidence required hereunder.

ARTICLE VI

Confidentiality

6.1 Confidentiality. During the Term of this Agreement and for a period of five (5) years thereafter, Employee agrees to maintain the confidential nature of the Company's confidential and proprietary trade secrets, including, without limitation, development ideas, acquisition strategies and plans, financial information, records, "know-how", methods of doing business, customer, supplier and distributor lists and all other confidential information of the Company. Employee shall not use (other than in connection with his employment), in any way whatsoever, such trade secrets except as authorized in writing by the Company. Employee shall, upon the termination of his employment, deliver to the Company any and all records, books, documents or any other materials whatsoever (including all copies thereof) containing such trade secrets that shall be and remain the property of the Company.

5.2 Non-Removal of Records. All documents, papers, materials, notes, books, correspondence, drawings and other written, graphic and electronic records of the Company which Employee shall prepare or use, or come into contact with, shall be and remain the sole property of the Company and, effective immediately upon the termination of the Employee's employment with the Company for any reason, shall not be removed from the Company's premises without the Company's prior written consent.

ARTICLE VII

Termination

7.1 Termination For Cause. This Agreement and the employment of Employee may be terminated by the Company "For Cause" upon the determination of not less than 75% of the members of the Board of Directors of the Company (the “Super Majority”), , in any of the following circumstances:

(a)Employee has committed any fraud, dishonesty, misappropriation or similar wrongful act against the Company; or

(b)Employee is in default in a material respect in the performance of Employee's obligations, services or duties hereunder, which shall include, without limitation, Employee's willfully disregarding the written instructions of the Board of Directors or CEO of the Company concerning the conduct of his duties hereunder, Employee's conduct which, continues to be in default after written notice thereof by the company and the expiration of a 45-day period to cure such default has elasped, is materially inconsistent with the published policies of the Company, as promulgated from time to time and which are generally applicable to all employees and/or senior executives, or Employee's breach of any other material provision of this Agreement; or

(c)Employee is grossly negligent or engages in willful misconduct in the performance of his duties hereunder; or

(d)Employee has been adjudicated guilty by, or enters a plea of guilty or no contest before, a court of competent jurisdiction of a felony or found by a court of competent jurisdiction to have engaged in other wrongful conduct which individually, or in the aggregate, has a material adverse effect on the Company, its prospects, earnings or financial condition, other than misdemeanors or minor traffic infractions.

A Termination For Cause under this Section 7.1 shall be effective upon the date set forth in a written notice of termination delivered to Employee.

7.2 Termination Without Cause. This Agreement and the employment of the Employee may be terminated "Without Cause" as follows:

(a)By mutual agreement of the parties hereto; or

(b)At the election of the Company by its giving not less than thirty (30) days' written notice to Employee in the event of an illness or incapacity described in Section 5.1; or

(c)Upon Employee's death.

A Termination Without Cause under Sections 7.2(b) or (c) hereof shall be effective upon the date set forth in a written notice of termination or resignation delivered hereunder, which shall be not less than thirty (30) days nor more than forty-five (45) days after the giving of such notice.

7.3 Effect of Termination For Cause. If Employee's employment is terminated For Cause:

(a)Employee shall be entitled to accrued base salary under Section 3.1 and accrued vacation pay, each through the date of termination;

(b)Employee shall be entitled to reimbursement for expenses accrued through the date of termination in accordance with the provisions of Section 4.1 hereof; and

(c)Except as provided in Article XI, this Agreement shall thereupon be of no further force and effect.

7.4 Effect of Termination Without Cause. If Employee's employment is terminated Without Cause:

(a)Employee shall be entitled to accrued base salary under Section 3.1 and accrued vacation pay, each through the date of termination;

(b)Employee shall be entitled to reimbursement for expenses accrued through the date of termination in accordance with the provisions of Section 4.1 hereof;

(c)Employee shall be entitled to receive all amounts of base salary as would have been payable under Section 3.1 (provided that Employee shall receive not less than twenty-four (24) months of base salary) through the Scheduled Termination Date of the applicable term hereof, which amounts shall be paid upon termination;

(d)Employee shall be entitled to receive all bonuses and benefits as would have been awarded and/or paid under Sections 3.2 and 3.4 hereof through (or as a result of events occurring through) the Scheduled Termination Date, which benefits shall be awarded as and when the same would have been awarded under the Agreement had it not been terminated; and

 (e)  All unvested stock options described in Exhibits B and C shall immediately vest without regard to any vesting conditions referenced therein..

(f) Except as provided in Article XI, this Agreement shall thereupon be of no further force or effect.

7.5 Termination Upon Change of Control. Upon a "Change of Control" (as such term is defined in Section 7.6 hereof) of the Company during the Term hereof, Employee may, at his sole discretion, declare this Agreement terminated and receive a one-time, lump sum severance payment equal to two (2) times the total amount of the annual base salary payable under the terms of Section 3.1 of this Agreement plus two(2) times any incentive or bonus paid in the prior year pursuant to Section 3.2 of this Agreement and all unvested stock options described in Exhibits B and C shall immediately vest without regard to any vesting conditions referenced therein.

7.6 Change of Control. For purposes of Section 7.5 of this Agreement, a Change of Control ("Change of Control") shall be deemed to have occurred in the event of:

(a)The acquisition by any person or entity, or group thereof acting in concert, of "beneficial" ownership (as such term is defined in Securities and Exchange Commission ("SEC") Rule 13d-3 under the Securities Exchange Act of 1934, as amended (the "Exchange Act")), of securities of the Company which, together with securities previously owned, confer upon such person, entity or group the voting power, on any matters brought to a vote of shareholders, of thirty percent (30%) or more of the then outstanding shares of capital stock of the Company; or

(b)The sale, assignment or transfer of assets of the Company or any subsidiary or subsidiaries, in a transaction or series of transactions, if the aggregate consideration received or to be received by the Company or any such subsidiary in connection with such sale, assignment or transfer is greater than fifty percent (50%) of the book value, determined by the Company in accordance with generally accepted accounting principles, of the Company's assets determined on a consolidated basis immediately before such transaction or the first of such transactions; or

(c)The merger, consolidation, share exchange or reorganization of the Company (or one or more subsidiaries of the Company) as a result of which the holders of all of the shares of capital stock of the Company as a group would receive less than fifty percent (50%) of the voting power of the capital stock or other interests of the surviving or resulting corporation or entity; or

(d)The commencement (within the meaning of SEC Rule 14d-2 under the Exchange Act) of a tender or exchange offer which, if successful, would result in a Change of Control of the Company; or

(e)A determination by the Board of Directors of the Company, in view of then current circumstances or impending events, that a Change of Control of the Company has occurred or is imminent, which determination shall be made for the specific purpose of triggering the operative provisions of this Agreement; or

7.7.Certain Additional Payments by the Company.

(a)     If it shall be determined that any payment, distribution or benefit received or to be received by Employee from the Company ("Payments") would be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then Employee shall be entitled to receive an additional payment (the "Excise Tax Gross-Up Payment) in an amount such that the net amount retained by Employee, after the calculation and deduction of any Excise Tax on the Payments and any federal, state and local income taxes and excise tax on the Excise Tax Gross-Up Payment provided for in this Section 7.7, shall be equal to the Payments. In determining this amount, the amount of the Excise Tax Gross-Up Payment attributable to federal income taxes shall be reduced by the maximum reduction in federal income taxes that could be obtained by the deduction of the portion of the Excise Tax Gross-Up Payment attributable to state and local income taxes. Finally, the Excise Tax Gross-Up Payment shall be reduced by income or excise tax withholding payments made by the Company or any affiliate of either to any federal, state or local taxing authority with respect to the Excise Tax Gross-Up Payment that was not deducted from compensation payable to Employee.

(b)    All determinations required to be made under this Section 7.7, including whether and when an Excise Tax Gross-Up Payment is required and the amount of such Excise Tax Gross-Up Payment and the assumptions to be utilized in arriving at such determination, except as specified in Section 7.7(a) above, shall be made by the Company's independent auditors (the "Accounting Firm"), which shall provide detailed supporting calculations both to the Company and Employee within 15 business days after Employee provides the Company with notice that a Payment has been or will be made or such earlier time as may be required by the Company. The determination of tax liability made by the Accounting Firm shall be subject to review by the Employee's tax advisor and, if Employee's tax advisor does not agree with the determination reached by the Accounting Firm, then the Accounting Firm and Employee's tax advisor shall jointly designate a nationally recognized public accounting firm, which shall make the determination. All fees and expenses of the accountants and tax advisors retained by either Employee or the Company shall be borne by the Company. Any Excise Tax Gross-Up Payment, as determined pursuant to this Section 7.7, with respect to a Payment shall be paid by the Company to Employee at such time as Employee is entitled to receive the Payment. Any determination by a jointly designated public accounting firm shall be binding upon the Company and Employee.

(c)      As a result of the uncertainty in the application of Subsection 4999 of the Code at the time of the initial determination hereunder, it is possible that Excise Tax Gross-Up Payments will not have been made by the Company that should have been made consistent with the calculations required to be made hereunder ("Underpayment"). In the event that Employee thereafter is required to make a payment of any Excise Tax, any such Underpayment calculated in accordance with and in the same manner as the Excise Tax Gross-Up Payment in Section 7.7(a) above shall be promptly paid by the Company to or for the benefit of Employee. In the event that the Excise Tax Gross-Up Payment exceeds the amount subsequently determined to be due, such excess shall constitute a loan from the Company to Employee payable on the fifth day after demand by the Company (together with interest at the rate provided in Section 1274(b)(2)(B) of the Code).

ARTICLE VIII

Non-Competition and Non-Interference

8.1 Non-Competition. Employee agrees that during the Term hereof and, in the case of a Termination For Causefor a period of two (2) years thereafter, Employee will not, directly, indirectly, or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity, own, manage, control, join, or participate in the ownership, management, operation, or control of, or be financially interested in or advise, lend money to, or be employed by or provide consulting services to (i) any person or entity seeking to provide the services or products which the Company provided or planned on providing as of the date of termination, or (ii) any person or entity to whom Employee provided services in any capacity on behalf of the Company, or (iii) any person or entity to whom Employee was introduced or about whom Employee received information through the Company and which person or entity is located within the United States of America; provided, however, that the foregoing restriction regarding financial interest shall not apply to ownership of less than 5% of the common equity of any entity whose common equity is registered under the Securities Exchange Act of 1934, as amended. 

8.2 Non-Interference. Employee agrees that during the Term hereof and, in the case of a Termination For Cause for a period of two (2) years thereafter, Employee will not, directly or as an agent on behalf of or in conjunction with any person, firm, partnership, corporation or other entity, retain or hire any person who was an employee of the Company while Employee was employed by the Company or to whom Employee was introduced or about whom Employee received information through the Company.

8.3 Severability. If any covenant or provision contained in this Article VIII is determined to be void or unenforceable in whole or in part, it shall not be deemed to affect or impair the validity of any other covenant or provision. If, in any arbitral or judicial proceeding, a tribunal shall refuse to enforce all of the separate covenants deemed included in this Article VIII, then such unenforceable covenants shall be deemed eliminated from the provisions hereof for the purpose of such proceedings to the extent necessary to permit the remaining separate covenants to be enforced in such proceedings.

ARTICLE IX

Remedies

9.1 Equitable Remedies. Employee and the Company agree that the services to be rendered by Employee pursuant to this Agreement, and the rights and interests granted and the obligations to be performed by Employee to the Company pursuant to this Agreement, are of a special, unique, extraordinary and intellectual character, which gives them a peculiar value, the loss of which cannot be reasonably or adequately compensated in damages in any action at law, and that a breach by Employee of any of the terms of this Agreement will cause the Company great and irreparable injury and damage. Employee hereby expressly agrees that the Company shall be entitled to the remedies of injunction, specific performance and other equitable relief to prevent a breach of Articles VI and VIII of this Agreement, both pendente lite and permanently, against Employee, as such breach would cause irreparable injury to the Company and a remedy at law would be inadequate and insufficient. Therefore, the Company may, in addition to pursuing its other remedies, obtain an injunction from any court having jurisdiction in the matter restraining any further violation.

9.2 Rights and Remedies Preserved. Nothing in this Agreement except Section 10.11 shall limit any right or remedy the Company or Employee may have under this Agreement or pursuant to law for any breach of this Agreement by the other party. The rights granted to the parties herein are cumulative and the election of one shall not constitute a waiver of such party's right to assert all other legal remedies available under the circumstances.

ARTICLE X

Miscellaneous

10.1 No Waivers. The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.

10.2 Notices. Any notice to be given to the Company and Employee under the terms of this Agreement may be delivered in person, by telecopy, telex or other form of written electronic transmission, or by registered or certified mail, postage prepaid, and shall be addressed as follows:

If to the Company

Market Central, Inc.

7810 Ballantyne Commons Parkway

Suite 300

Charlotte, NC 28277

Attention: Chief Executive Officer

If to Employee

Paul Odom

17023 Evergreen Elm Way

Houston, Texas 77059

Either party may hereafter notify the other in writing of any change in address. Any notice shall be deemed duly given (i) when personally delivered, (ii) when telecopied, telexed or transmitted by other form of written electronic transmission (upon confirmation of receipt) or (iii) on the third day after it is mailed by registered or certified mail, postage prepaid, as provided herein.

10.3 Severability. The provisions of this Agreement are severable and if any provision of this Agreement shall be held to be invalid or otherwise unenforceable, in whole or in part, the remainder of the provisions, or enforceable parts thereof, shall not be affected thereby.

10.4 Successors and Assigns. The rights and obligations of the Company under this Agreement shall inure to the benefit of and be binding upon the successors and assigns of the Company, including the survivor upon any merger, consolidation, share exchange or combination of the Company with any other entity. Employee shall not have the right to assign, delegate or otherwise transfer any duty or obligation to be performed by him hereunder to any person or entity.

10.5 Entire Agreement. This Agreement supersedes any and all prior and contemporaneous agreements and understandings between the parties hereto, oral or written, and may not be modified or terminated orally. No modification, termination or attempted waiver shall be valid unless in writing, signed by the party against whom such modification, termination or waiver is sought to be enforced. This Agreement was the subject of negotiation by the parties hereto and their counsel. The parties agree that no prior drafts of this Agreement shall be admissible as evidence (whether in any arbitration or court of law) in any proceeding that involves the interpretation of any provisions of this Agreement.

10.6 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of North Carolina without reference to the conflict of law principles thereof.

10.7 Section Headings. The section headings contained herein are for the purposes of convenience only and are not intended to define or limit the contents of said sections.

10.8 Further Assurances. Each party hereto shall cooperate and shall take such further action and shall execute and deliver such further documents as may be reasonably requested by the other party in order to carry out the provisions and purposes of this Agreement.

10.9 Gender. Whenever the pronouns "he" or "his" are used herein they shall also be deemed to mean "she" or "hers" or "it" or "its" whenever applicable. Words in the singular shall be read and construed as though in the plural and words in the plural shall be read and construed as though in the singular in all cases where they would so apply.

10.10 Counterparts. This Agreement may be executed in counterparts, all of which taken together shall be deemed one original.

10.11 Confidential Arbitration. The parties hereto agree that any dispute concerning or arising out of the provisions of this Agreement shall be resolved by confidential arbitration in accordance with the rules of the American Arbitration Association. Such confidential arbitration shall be held in Charlotte North Carolina, and the decision of the arbitrator(s) shall be conclusive and binding on the parties and shall be enforceable in any court of competent jurisdiction. The arbitrator may, in his or her discretion, award attorneys’ fees and costs to such party as he or she sees fit in rendering his or her decision. Notwithstanding the foregoing, if any dispute arises hereunder as to which the Company desires to exercise any rights or remedies under Section 9.1 hereof, the Company may, in its discretion, in lieu of submitting the matter to arbitration, bring an action thereon in any court of competent jurisdiction in Charlotte North Carolina, which court may grant any and all relief available in equity or at law. In any such action, the prevailing party shall be entitled to reasonable attorneys' fees and costs as may be awarded by the court.

ARTICLE XI

Survival

11.1 Survival. The provisions of Articles VI, VII, VIII, IX and X, of this Agreement shall survive the termination of this Agreement whether upon, or prior to, the Scheduled Termination Date hereof.

 IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement as of the date first above written.

Market Central Inc, Inc., a Delaware corporation
By:
EMPLOYEE
	Paul Odom

“Exhibit A”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on (the “Grant Date”) to Paul Odom, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 200,000 shares (the “Shares”) of common stock, $0.001 par value per share, of the Company (“Common Stock”) at $1.60 per Share. Unless earlier terminated, this option shall expire on January 14, 2009 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

(a) General. Subject to the terms and conditions set forth in this Agreement, this option will become fully exercisable (“vested”) on the day of the date that this agreement is effective. Employee has four (4) years from the date of this agreement to exercise the options.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a) Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of one year following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than one year after the Employee’s termination as an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option.

(b) Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(f) Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph shall be as set forth above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Paul Odom

“Exhibit B”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on (the “Grant Date”) to Paul Odom, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 200,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.00 per Share. Unless earlier terminated, this option shall expire on January 14, 2011 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its ter

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

General.   These options will vest, subject to achieving the stock price goals shown below and at 25% per year on the anniversary date of this agreement unless price targets are achieved earlier   Vesting of these options shall occur upon occurrence of the following:

		Stock Price Target
Year 1	(during first year from commencement)	$2.25
Year 2		3.00
Year 3		3.75
Year 4		4.50

Stock price target is achieved when the average closing bid is at least the target price for 10 consecutive trading days during the respective year. Alternatively, theseoptions or any portion thereof shall immediately vest if the Company completes an underwriting of at least $5 million at or above the target price(s). Not achieving price goals in one year does not result in loss of the options, only that the ability to exercise is delayed, achieving any stock price target in a subsequent year results in all prior options being exercisable. Achieving a stock price target earlier than shown on the table above will result in immediate vesting and exerecisablity of those options in 50% of the time contemplated herein. An example is:

1)   If the stock price reaches $3.80 in the first year of the contract, then 75% of the options are fully vested and owned by the employee. All of them would be exercisable after 1.5 years rather than 3 years.

2)   If the stock price were to remain at $2.00 for three years and then move to $5.00 in year three, all of the options would be vested and exercisable immediately.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a)   Termination of Relationship with the Company. If the Employee ceases to be an Eligible Employee for any reason, then, except as provided in paragraphs (d) and (e) below, the right to exercise this option shall terminate three months after such cessation (but in no event after the Final Exercise Date), provided that (i) this option shall be exercisable only to the extent that the Employee was entitled to exercise this option on the date of such cessation, and (ii) to the extent that the option or any portion thereof is exercised at any time later than three months after the date that the Employee ceases to be an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option. Notwithstanding the foregoing, if the Employee, prior to the Final Exercise Date, violates the non-competition or confidentiality provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Employee and the Company, the right to exercise this option shall terminate immediately upon such violation.

(b)   Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than one year after the Employee’s termination as an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option.

(c)   Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(d)   Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph shall be as set forth above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature Name: Paul Odom

“Exhibit C”

Market Central, Inc.

Incentive Stock Option Agreement

1. Grant of Option.

This Incentive Stock Option Agreement (this “Agreement”) evidences the grant by Market Central, Inc., a Delaware corporation (the “Company”), on (the “Grant Date”) to Paul Odom, an employee of the Company (the “Employee”), of an option to purchase, in whole or in part, on the terms provided herein a total of 200,000 shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”) at $2.25 per Share. Unless earlier terminated, this option shall expire on January 14, 2011 (the “Final Exercise Date”).

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its ter

It is intended that the option evidenced by this agreement shall, to the extent it so qualifies, be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended and any regulations promulgated there under (the “Code”). To the extent that the option does not on the date of grant, or hereafter ceases to, qualify as an incentive stock option, it shall be a non-qualified stock option. Except as otherwise indicated by the context, the term “Employee”, as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms.

2. Vesting Schedule.

(a General. These options will vest, subject to achieving the stock price goals shown below and at 25% per year on the anniversary date of this agreement unless price targets are achieved earlier      Vesting of these options shall occur upon occurrence of the following:

		Stock Price Target
Year 1	(during first year from commencement)	$5.25
Year 2		6.00
Year 3		6.75
Year 4		7.50

Stock price target is achieved when the average closing bid is at least the target price for 10 consecutive trading days during the respective year. Alternatively, these options or any portion thereof shall immediately vest if the Company completes an underwriting of at least $5 million at or above the target price(s). ). Not achieving price goals in one year does not result in loss of the options, only that the ability to exercise is delayed, achieving any stock price target in a subsequent year results in all prior options being exercisable. Achieving a stock price target earlier than shown on the table above will result in immediate vesting and exerecisablity of those options in 50% of the time contemplated herein. An example is:

1)   If the stock price reaches $7.00 in the first year of the contract, then 75% of the options are fully vested and owned by the employee. All of them would be exercisable after 1.5 years rather than 3 years.

2)   If the stock price were to remain at $4.50 for three years and then move to $7.00 in year three, all of the options would be vested and exercisable immediately.

3. Exercise of Option.

Form of Exercise. In order to exercise this option, the Employee shall notify the Company’s third-party stock option plan administrator, or any successor appointed by the Company (the “Plan Administrator”), of the Employee’s intent to exercise this option, and shall follow the procedures established by the Plan Administrator for exercising stock options under the Plan and provide payment in full in the manner provided in the Plan. The Employee may purchase less than the number of shares covered hereby, provided that no partial exercise of this option may be for any fractional share.

(a)   Termination of Relationship with the Company. If the Employee ceases to be an Eligible Employee for any reason, then, except as provided in paragraphs (d) and (e) below, the right to exercise this option shall terminate three months after such cessation (but in no event after the Final Exercise Date), provided that (i) this option shall be exercisable only to the extent that the Employee was entitled to exercise this option on the date of such cessation, and (ii) to the extent that the option or any portion thereof is exercised at any time later than three months after the date that the Employee ceases to be an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option. Notwithstanding the foregoing, if the Employee, prior to the Final Exercise Date, violates the non-competition or confidentiality provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Employee and the Company, the right to exercise this option shall terminate immediately upon such violation.

(b)   Exercise Period Upon Death or Disability. If the Employee dies or becomes disabled prior to the Final Exercise Date while he or she is an Eligible Employee and the Company has not terminated such relationship for “cause”, this option shall be exercisable, within the period of three years following the date of death or disability of the Employee by the Employee, provided that (i) this option shall be exercisable only to the extent that this option was exercisable by the Employee on the date of his or her death or disability, (ii) this option shall not be exercisable after the Final Exercise Date, and (iii) to the extent that the option or any portion thereof is exercised at any time later than one year after the Employee’s termination as an employee of the Company or any parent or subsidiary of the Company, the option shall be a non-qualified stock option.

(e)   Discharge for Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for “cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Employee or willful failure by the Employee to perform his or her responsibilities to the Company (including, without limitation, breach by the Employee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Employee and the Company), as determined by the Company, which determination shall be conclusive. The Employee shall be considered to have been discharged for “cause” if the Company determines, prior to or simultaneously with the Employee’s resignation, that discharge for cause was warranted.

(f)   Discharge for Reasons Other Than Cause. If the Employee, prior to the Final Exercise Date, is discharged by the Company for a reason other than “cause” (as defined above), then 100% of all Shares shall be deemed vested as of the termination date. The period of time for exercise of vested options under this paragraph shall be as set forth above.

4. Withholding.

No Shares will be issued pursuant to the exercise of this option unless and until the Employee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option.

5. Nontransferability of Option.

This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Employee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Employee, this option shall be exercisable only by the Employee.

6. Disqualifying Disposition.

If the Employee disposes of Shares acquired upon exercise of this option within two years from the Grant Date (or, in the case of Shares acquired upon exercise of an Additional Grant, the date of the Addendum) or one year after such Shares were acquired pursuant to exercise of this option, the Employee shall notify the Company in writing of such disposition.

IN WITNESS WHEREOF, the Company has caused this option to be executed under its corporate seal by its duly authorized officer. This option shall take effect as a sealed instrument.

	MARKET CENTRAL, INC.
Dated:
		Signature Name Title

EMPLOYEE’S ACCEPTANCE

The undersigned hereby accepts the foregoing option and agrees to the terms and conditions thereof.

EMPLOYEE:
	Signature

EX-14.1

MARKET CENTRAL, INC.

CODE OF BUSINESS CONDUCT AND ETHICS

ADOPTED BY THE BOARD OF DIRECTORS

ON SEPTEMBER 24, 2003

Introduction

This Code of Business Conduct and Ethics is applicable to all directors, officers and employees of the Company and covers a wide range of business practices and procedures. It does not cover every issue that may arise, but it sets out basic principles to guide all employees of the Company. All of our employees must conduct themselves accordingly and seek to avoid even the appearance of improper behavior. The Code should also be provided to and followed by the Company’s agents and representatives, including consultants.

If a law conflicts with a policy in this Code, you must comply with the law. If you have any questions about these conflicts, you should ask your supervisor how to handle the situation.

Those who violate the standards in this Code will be subject to disciplinary action, up to and including termination of employment, lf you are in a situation which you believe may violate or lead to a violation of this Code, follow the guidelines described in Section 14 of this Code.

1.Compliance with Laws, Rules and Regulations

Obeying the law, both in letter and in spirit, is the foundation on which this Company’s ethical standards are built. All employees must respect and obey the laws of the cities, states and countries in which we operate. Although not all employees are expected to know the details of these laws, it is important to know enough to determine when to seek advice from supervisors, managers or other appropriate personnel.

If requested, the Company will hold information and training sessions to promote compliance with laws, rules and regulations, including insider-trading laws.

2.Conflicts of Interest

A “conflict of interest” exists when a person’s private interest interferes in any way with the interests of the Company. A conflict situation can arise when an employee, officer or director takes actions or has interests that may make it difficult to perform his or her Company work objectively and effectively. Conflicts of interest may also arise when an employee, officer or director, or members of his or her family, receives improper personal benefits as a result of his or her position in the Company. Loans to, or guarantees of obligations of, employees and their family members may create conflicts of interest.

It is almost always a conflict of interest for a Company employee to work simultaneously for a competitor, customer or supplier. You are not allowed to work for a competitor as a consultant or board member. The best policy is to avoid any direct or indirect business connection with our customers, suppliers or competitors, except on our behalf. Conflicts of interest are prohibited as a matter of Company policy, except under guidelines approved by the Board of Directors. Conflicts of interest may not always be clear-cut, so if you have a question, you should consult with higher levels of management or the Company’s Audit Committee. Any employee, officer or director who becomes aware of a conflict or potential conflict should bring it to the attention of a supervisor, manager or other appropriate personnel or consult the procedures described in Section 14 of this Code.

3.Insider Trading

Employees who have access to confidential information are not permitted to use or share that information for stock trading purposes or for any other purpose except the conduct of our business. All non-public information about the Company should be considered confidential information. To use non-public information for personal financial benefit or to “tip” others who might make an investment decision on the basis of this information is not only unethical but also illegal. In order to assist with compliance with laws against insider trading, the Company has adopted a specific policy governing employees’ trading in securities of the Company. This policy has been distributed to every employee. If you have any questions, please consult the officer designated by the Insider Trading Policy to answer questions.

4.Corporate Opportunities

Employees, officers and directors are prohibited from taking for themselves personally opportunities that are discovered through the use of corporate property, information or position without the consent of the Board of Directors. No employee may use corporate property, information, or position for improper personal gain, and no employee may compete with the Company directly or indirectly. Employees, officers and directors owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises.

5.Competition and Fair Dealing

We seek to outperform our competition fairly and honestly. Stealing proprietary information, possessing trade secret information that was obtained without the owner’s consent, or inducing such disclosures by past or present employees of other companies is prohibited. Each employee should endeavor to respect the rightsof and deal fairly with the Company’s customers, suppliers, competitors and employees. No employee should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts, or any other intentional unfair-dealing practice.

The purpose of business entertainment and gifts in a commercial setting is to create good will and sound working relationships, not to gain unfair advantage with customers. No gift or entertainment should ever be offered, given, provided or accepted by any Company employee, family member of an employee or agent unless it: (l) is not a cash gift, (2) is consistent with customary business practices, (3) is not excessive in value, (4) cannot be construed as a bribe or payoff and (5) does not violate any laws or regulations. Please discuss with your supervisor any gifts or proposed gifts which you are not certain are appropriate.

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6.Discrimination and Harassment

The diversity of the Company’s employees is a tremendous asset. We are firmly committed to providing equal opportunity in all aspects of employment and will not tolerate any illegal discrimination or harassment of any kind. Examples include derogatory comments based on racial or ethnic characteristics and unwelcome sexual advances.

7.Health and Safety

The Company strives to provide each employee with a safe and healthy work environment. Each employee has responsibility for maintaining a safe and healthy workplace for all employees by following safety and health rules and practices and reporting accidents, injuries and unsafe equipment, practices or conditions.

Violence and threatening behavior are not permitted. Employees should report to work in condition to perform their duties, free from the influence of illegal drugs or alcohol. The use of illegal drugs or alcohol in the workplace will not be tolerated.

8.Record-Keeping

The Company requires honest and accurate recording and reporting of information in order to make responsible business decisions. For example, only the true and actual number of hours worked should be reported.

Many employees regularly use business expense accounts, which must be documented and recorded accurately. If you are not sure whether a certain expense is legitimate, ask your supervisor or your controller.

All of the Company’s books, records, accounts and financial statements must be maintained in reasonable detail, must appropriately reflect the Company’s transactions and must conform both to applicable legal requirements and to the Company’s system of internal controls. Unrecorded or “off the books” funds or assets should not be maintained unless permitted by applicable law or regulation.

Business records and communications often become public, and we should avoid exaggeration, derogatory remarks, guesswork, or inappropriate characterizations of people and companies that can be misunderstood. This applies equally to e-mail, internal memos, and formal reports. Records should always be retained or destroyed according to the Company’s record retention policies. In accordance with those policies, in the event of litigation or governmental investigation please consult your supervisor.

9.Confidentiality

Employees must maintain the confidentiality of confidential information entrusted to them by the Company or its customers, except when disclosure is specifically authorized by the Company or required by laws or regulations. Confidential information includes all non-public information that might be of use to competitors, or harmful to the Company or its customers, if disclosed, it also includes information that suppliers and customers have entrusted to us. The obligation to preserve confidential information continues even after employment ends. In connection with this obligation, every employee should have executed a confidentiality agreement when he or she began his or her employment with the Company.

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10.Protection and Proper Use of Company Assets

All employees should endeavor to protect the Company’s assets and ensure their efficient use. Theft, carelessness and waste have a direct impact on the Company’s profitability. Any suspected incident of fraud or theft should be immediately reported for investigation. Company equipment should not be used for non-Company business, though incidental personal use may be permitted.

The obligation of employees to protect the Company’s assets includes its proprietary information. Proprietary information includes intellectual property such as trade secrets, patents, trademarks and copyrights, as well as business, marketing and service plans, engineering and manufacturing ideas, designs, databases, records, salary information and any unpublished financial data and reports. Unauthorized use or distribution of this information would violate Company policy. It could also be illegal and result in civil or even criminal penalties.

11.Payments to Government Personnel

The U.S. Foreign Corrupt Practices Act prohibits giving anything of value, directly or indirectly, to officials of foreign governments or foreign political candidates in order to obtain or retain business. It is strictly prohibited to make illegal payments to government officials of any country.

In addition, the U.S. government has a number of laws and regulations regarding business gratuities which may be accepted by U.S. government personnel. The promise, offer or delivery to an official or employee of the U.S. government of a gift, favor or other gratuity in violation of these rules would not only violate Company policy but could also be a criminal offense. State and local governments, as well as foreign governments, may have similar rules. The Company’s Legal Department can provide guidance to you in this area.

12.Waivers of the Code of Business Conduct and Ethics

Any waiver of this Code for executive officers or directors may be made only by the Board or a Board committee and will be promptly disclosed as required by law or stock exchange regulation.

13.Reporting any Illegal or Unethical Behavior

Employees are encouraged to talk to supervisors, managers or other appropriate personnel about observed illegal or unethical behavior and when in doubt about the best course of action in a particular situation. It is the policy of the Company not to allow retaliation for reports of misconduct by others made in good faith by employees. Employees are expected to cooperate in internal investigations of misconduct.

4

Employees must read the Company’s Employee Complaint Procedures for Accounting and Auditing Matters, which describes the Company’s procedures for the receipt, retention, and treatment of complaints received by the Company regarding accounting, internal accounting controls, or auditing matters. Any employee may submit a good faith concern regarding questionable accounting or auditing matters without fear of dismissal or retaliation of any kind.

14.Compliance Procedures

We must all work to ensure prompt and consistent action against violations of this Code. However, in some situations it is difficult to know if a violation has occurred. Since we cannot anticipate every situation that will arise, it is important that we have a way to approach a new question or problem. These are the steps to keep in mind:

▪   Make sure you have all the facts. In order to reach the right solutions, we must be as fully informed as possible.

▪   Ask yourself: “What specifically am I being asked to do? Does it seem unethical or improper?” This will enable you to focus on the specific question you are faced with, and the alternatives you have. Use your judgment and common sense; if something seems unethical or improper, it probably is.

▪   Clarify your responsibility and role. In most situations, there is shared responsibility. Are your colleagues informed? It may help to get others involved and discuss the problem.

▪   Discuss the problem with your supervisor. This is the basic guidance for all situations. In many cases, your supervisor will be more knowledgeable about the question, and will appreciate being brought into the decision-making process. Remember that it is your supervisor’s responsibility to help solve problems.

▪   Seek help from Company resources. In the rare case where it may not be appropriate to discuss an issue with your supervisor, or where you do not feel comfortable approaching your supervisor with your question, discuss it locally with your office manager or your Human Resources manager.

▪   You may report ethical violations in confidence and without fear of retaliation. If your situation requires that your identity be kept secret, your anonymity will be protected. The Company does not permit retaliation of any kind against employees for good faith reports of ethical violations.

▪   Always ask first, act later. If you are unsure of what to do in any situation, seek guidance before you act.

5

EX-14.2

MARKET CENTRAL, INC.

CODE OF ETHICS FOR SENIOR FINANCIAL OFFICERS

ADOPTED BY THE BOARD OF DIRECTORS

ON SEPTEMBER 24, 2003

This Code of Ethics has been adopted by the Board of Directors of Market Central, Inc. (the “Company”) pursuant to Section 406 of the Sarbanes-Oxley Act of 2002 and related regulations adopted by the Securities and Exchange Commission. This Code of Ethics applies to the Chief Executive Officer, Chief Financial Officer and the principal accounting officer or controller (collectively the “Senior Financial Officers”) of the Company. Its purpose is to deter wrongdoing and to promote honest and ethical conduct and compliance with the law, particularly as relates to the maintenance of the Company’s financial records and the preparation of financial statements and reports filed with or submitted to the Securities and Exchange Commission (the “SEC”). The obligations of this Code of Ethics are in addition to and do not supplant the general Code of Business Conduct and Ethics applicable to all Company employees.

1.Senior Financial Officers are expected to carry out their responsibilities honestly and with integrity, exercising at all times their best independent judgment. Confidential information acquired in the course of one’s duties shall not be used for personal advantage.

2.Senior Financial Officers should avoid, to the extent possible, situations in which their own interests conflict, or may appear to conflict, with the interest of the Company. Conflicts of interest are sometimes unavoidable, however. In any case in which a Senior Financial Officer finds himself with an actual or apparent material conflict of interest, he must promptly disclose it to the Audit Committee which will review the transaction or relationship and determine how the situation should be resolved.

3.Senior Financial Officers are responsible for assuring full, fair, accurate, timely and understandable disclosure of relevant financial and other information to shareholders and investors. In particular they are responsible for assuring that the Company complies with SEC rules governing disclosure of financial information and for assuring that press releases and other public communications are full, fair, accurate, understandable and timely made. Among other things, Senior Financial Officers shall:

3.1Establish and maintain internal controls and procedures and disclosure controls and procedures designed to assure that financial information is recorded, processed and transmitted to those responsible for preparing periodic reports and other public communications containing financial information so that they are full, fair, accurate, understandable and timely.

3.2Carefully review each periodic report for accuracy and completeness before it is filed with the SEC and carefully review each public communication containing financial information before it is released and promptly bring to the attention of their superiors or, if necessary, the Audit committee any material information of which he or she may become aware that affects the disclosures made by the Company in its public filings.

3.3Promptly disclose to the Audit Committee and the Company’s independent auditors any information he or she may have concerning (a) significant deficiencies in the design or operation of internal controls which could adversely affect the Company’s ability to record, process, summarize and report financial data or (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s financial reporting, disclosures or internal controls.

4.Senior Financial Officers shall comply at all times with applicable governmental laws, rules and regulations.

5.Senior Financial Officers shall promptly bring to the attention of the Audit Committee or the full Board of Directors:

5.1Any matters that could compromise the integrity of the Company’s financial reports,

5.2Any disagreement with respect to any material accounting matter,

5.3Any violation of this Code of Ethics, the Company’s general Code of Business Conduct and Ethics or of any law or regulation related to the Company’s business, operations or accounting or financial affairs,

5.4Any actual or apparent conflicts of interest between personal and professional relationships involving management or other employees who have a significant role in the Company’s financial reporting, disclosures or internal controls, and

5.5Any information he or she may have concerning evidence of a material violation of the securities or other laws.

6.The approval of the Audit Committee of the Board of Directors shall be required for any waiver or amendment of this Code of Ethics, and any such waiver or amendment shall be disclosed promptly by the filing of a Current Report on Form 8-K with the SEC in accordance with the instructions to that Form.

7.Senior Financial Officers should recognize that a violation of the standards contained in this Code of Ethics will result in corrective action, including possible dismissal.

2

EX-21.1

Exhibit 21.1

Subsidiaries

Convey Systems International, Inc.

Tigo Search, Inc.

EX-23.2

Exhibit 23.2

CONSENT OF REGISTERED INDEPENDENT PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form S-4 of our report dated October 4, 2005, except for Note S, which date is November 7, 2005, relating to the consolidated financial statements of Market Central, Inc. which appear in the Prospectus, which is part of this Registration Statement. We also consent to the reference to us under the headings “Experts” in such Prospectus.

   /s/ RUSSELL BEDFORD STEFANOU MIRCHANDANI LLP

McLean, Virginia
November 10, 2005

EX-99.1

EXHIBIT 99.1

MARKET CENTRAL, INC. d/b/a SCIENTIGO, INC.

LETTER OF TRANSMITTAL

This Letter of Transmittal must accompany instruments for Scientigo’s 2005 6.4% Senior Convertible Notes (the “Old Notes”) and Warrants to Purchase Common Stock (the “Old Warrants”) of Market Central, Inc. d/b/a Scientigo, Inc. (the “Company”) surrendered in connection with the exchange of such Old Notes and Old Warrants for either Scientigo’s new 8% A Notes (the “A Notes”) or 8% B Notes (the “B Notes”) (collectively, the “New Notes”) and new A Warrants (the “A Warrants”) and B Warrants (the “B Warrants”) (collectively, the “New Warrants”) of the Company.

SEND IN THE ENCLOSED ENVELOPE TO:

Greenberg Traurig, LLP

Suite 400

3290 Northside Parkway

Atlanta, GA 30327

Attention: Gerald L. Baxter

678-553-2100

as Exchange Agent

Delivery of the enclosed instrument(s) will be effected and risk of loss shall pass only upon proper delivery to the Exchange Agent in accordance with this Letter of Transmittal.

THE INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE YOU COMPLETE THIS LETTER OF TRANSMITTAL.

To the holders of Old Notes and Old Warrants of Market Central, Inc. d/b/a Scientigo, Inc. (the “Company”):

In accordance with the terms of the exchange offer described in the prospectus dated __________, 200_ (the “Prospectus”), whereby, the undersigned hereby surrenders to Greenberg Traurig, LLP, as Exchange Agent (the “Exchange Agent”), the instruments described below representing the Old Notes and the Old Warrants of the Company. The instruments accompanying this Letter of Transmittal are being surrendered in exchange for the New Notes and New Warrants.

The undersigned hereby warrants that the undersigned has full power and authority to surrender the instruments delivered herewith, that, with respect to the instruments, the Old Notes and Old Warrants represented thereby are free and clear of all liens, charges, encumbrances, pledges, security interests, or other obligations, and that such instruments and New Notes and New Warrants will not be subject to any adverse claim. Upon request, the undersigned hereby agrees to execute and deliver any additional documents deemed necessary or desirable by the Exchange Agent to complete the surrender of the instruments.

The undersigned hereby irrevocably constitutes the Exchange Agent, or its designee or appointee, his, her or its true and lawful attorney-in-fact with respect to the instruments surrendered herewith, to deliver such instruments together with all accompanying evidences of authority, against receipt therefor (as the undersigned’s agent) of the New Notes and New Warrants as provided in the Prospectus and in this Letter of Transmittal (such power of attorney being deemed a power coupled with an interest).

Unless otherwise indicated in the box entitled “Special Issuance Instructions” and/or “Special Delivery Instructions” on this Letter of Transmittal, if applicable, the undersigned requests that the New Notes and New Warrants be issued in the name of holder appearing in the following box:

Name and Address of Registered Holder(s) of Record	Instrument(s) Enclosed: (Attach signed separate list if space below is inadequate.)
	Instrument Number	Principal Amount of Old Notes and Number of Old Warrants Represented by Instrument(s)

If you have previously exercised your Old Warrants and wish to tender your Old Notes, you need only enclose the instruments representing your Old Notes.

You must elect to receive either A Notes or B Notes as described in the Prospectus. You may not elect to receive both A Notes and B Notes. Please indicate your election below. If no election is designated or if both A Notes and B Notes are elected to be received, you will be issued A Notes.

I elect to receive A Notes o

CHECK ONE BOX ONLY

I elect to receive B Notes o

The undersigned acknowledges that by surrendering to the Exchange Agent the instruments described above, the undersigned has rejected the rescission offer as described in the Prospectus.

INSTRUCTIONS

1.Guarantee of Signatures. Signatures on this Letter of Transmittal need not be guaranteed: (a) if this Letter of Transmittal is signed by the registered holder(s) of the instrument(s) transmitted herewith and such holder(s) has (have) not completed the instruction entitled “Special Delivery Instructions” or “Special Issuance Instructions” on this Letter of Transmittal; or (b) if such instruments are transmitted for the account of an Eligible Institution. In all other cases, all signatures on this Letter of Transmittal must be guaranteed by a financial institution (including most banks, savings and loan associations and brokerage houses) that is a participant in the Securities Transfer Agents Medallion Program, the New York Stock Exchange Medallion Signature Program or the Stock Exchange Medallion Program (each of the foregoing constituting an “Eligible Institution”). See Instruction 4.

2.Delivery of Letter of Transmittal and Instruments; Lost Instruments. Instruments surrendered, as well as a properly completed and duly executed Letter of Transmittal, any required signature guarantees and any other documents required by this Letter of Transmittal, must be delivered to the Exchange Agent at its address set forth on the cover of this Letter of Transmittal. In the event that your instruments have been lost, stolen or destroyed, please indicate this on the face of this Letter of Transmittal. The Exchange Agent will forward you additional documentation that you must complete in order to effectively surrender lost, stolen or destroyed instruments, including an affidavit of the fact that such instruments have been lost, stolen or destroyed. A surety bond may be required. All questions as to the documents, validity, form, eligibility and acceptance for exchange of any instruments surrendered pursuant to any of the procedures described herein will be determined by the Exchange Agent, and its reasonable determination shall be final and binding. Delivery of instruments surrendered hereby shall be effected and risk of loss and title to instruments shall pass only upon proper delivery thereof to the Exchange Agent. Delivery of documents to an address other than the address set forth on the cover of this Letter of Transmittal does not constitute delivery to the Exchange Agent. The surrender of instruments will be deemed made only when this Letter of Transmittal and any other documents are actually received by the Exchange Agent.

The method of delivery of instruments and the other required documents is at the option and risk of the tendering holder. If sent by mail, registered mail with return receipt requested, is recommended.

3.Inadequate Space. If the space provided herein is inadequate, the instrument numbers and/or the principal amount of Old Notes and number of Old Warrants should be listed on a separate signed schedule and attached hereto.

4.Signatures on Letter of Transmittal, Endorsements of Instruments. If this Letter of Transmittal is signed by the registered holder(s) of the instrument(s) transmitted hereby, the signature(s) must correspond with the name(s) as written on the face of the instrument(s) without alteration, enlargement or any change whatsoever.

If any of the instruments transmitted hereby are held of record by two or more joint holders, all such holders must sign this Letter of Transmittal.

If any of the instruments transmitted hereby are registered in different names on several instruments, it will be necessary to complete, sign and submit as many separate Letters of Transmittal as there are different registrations of instruments.

When this Letter of Transmittal is signed by the registered holder(s) of the instrument(s) listed and transmitted hereby, no endorsements of instruments or signature guarantees are required. If, however, this Letter of Transmittal is signed by a person other than the registered holder(s), then the instrument(s) transmitted hereby must be endorsed or accompanied by appropriate endorsements of instruments . An Eligible Institution must guarantee all signatures on such instruments and on this Letter of Transmittal if special issuance instructions are given.

If this Letter of Transmittal or any instrument is signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and proper evidence satisfactory to the Exchange Agent of this authority so to act must be submitted.

5.Special Issuance and Delivery Instructions; Transfer Taxes. If the New Notes and New Warrants are to be issued in the name(s) of person(s) other than the signer(s) of this Letter of Transmittal or if the New Notes and New Warrants are to be sent to someone other than the signer of this Letter of Transmittal or to an address other than that shown above, the appropriate boxes on this Letter of Transmittal should be completed. If the New Notes and New Warrants are to be issued in the name(s) of person(s) other than the signer(s) of this Letter of Transmittal or if the New Notes and New Warrants are to be sent to someone other than the signer of this Letter of Transmittal, then the instrument(s) transmitted hereby must be endorsed. The person requesting such issuance or delivery shall pay to the Exchange Agent any transfer or other taxes payable by reason of the foregoing or shall establish to the satisfaction of the Exchange Agent that such taxes have been paid or are not required to be paid.

6.Requests for Assistance and Additional Copies. Request for assistance may be directed to the Exchange Agent or to your broker, dealer, commercial bank or trust company. Additional copies of this Letter of Transmittal and the Certification of Taxpayer Identification Number on Substitute Form W-9 may be obtained from the Exchange Agent at the address set forth above.

7.Substitute Form W-9. Each tendering holder is required to provide the Exchange Agent with a correct taxpayer identification number (“TIN”), generally the holder’s social security or federal employer identification number, on Substitute Form W-9, which is provided below. You must cross out item (2) in the certification box on the Substitute Form W-9 if you are subject to backup withholding. Failure to provide the information on the form may subject the tendering holder to 28% federal income tax withholding on the value of the New Notes and New Warrants issued to the holder with respect to their instruments. The box in Part 3 of the form may be checked if the tendering holder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 3 is checked and the Exchange Agent is not provided with a TIN within sixty (60) days, thereafter the Exchange Agent will withhold delivery of the New Notes and New Warrants until a TIN is provided to the Exchange Agent.

8.No Conditional Surrender. No alternative, conditional or contingent surrender of instruments will be accepted.

9.Miscellaneous and Inquires. All inquires regarding the surrender of Old Notes and Old Warrants and the Letter of Transmittal should be directed to the Exchange Agent at the address listed above.

    SPECIAL ISSUANCE INSTRUCTIONS (See Instructions 1, 4 and 5) To be completed ONLY if the New Notes and New Warrants are to be issued in the name of someone other than the registered holder.   Issue New Notes and New Warrants to:   Name:                                                                (Please print) Address:                                                           (Zip Code)       (Taxpayer Identification or Social Security No.): __________________     SPECIAL DELIVERY INSTRUCTIONS (See Instructions 1, 4 and 5) To be completed ONLY if the New Notes and New Warrants are to be sent to someone other than the registered holder or to the registered holder at an address other than that below.   Deliver New Notes and New Warrants to:   Name:                                                                (Please print) Address:                                                           (Zip Code)     (Taxpayer Identification or Social Security No.): __________________

SIGN HERE

Also complete Substitute Form W-9

Signature(s) of Holder(s): _________________________________________________________________

                                              _________________________________________________________________

Dated: _________, 200__

(Must be signed by registered holder(s) exactly as name(s) on instrument(s) or on a security position listing or by person(s) authorized to become registered holder(s) by instruments and documents transmitted herewith. If signature is by an officer of a corporation, attorney-in-fact, executor, administrator, trustee, guardian or other person(s) acting in a fiduciary or representative capacity, please set forth full title and see Instruction 4.)

Name(s): _________________________________________________________________________________

                _________________________________________________________________________________

(Print Name)

Capacity (Full Title): _______________________________________________________________________

Address: ________________________________________________________________________________

                 ________________________________________________________________________________

Area Code and Tel. No: ________________________

Taxpayer Identification or Social Security Number:__________________________________

GUARANTEE OF SIGNATURE(S)

(If Required--See Instructions 1 and 4)

Authorized Signature: ________________________________________________________

Name(s): __________________________________________________________________

(Please print)

Name of Firm: ______________________________________________________________

Address: __________________________________________________________________

Area Code and Tel. No.: ________________________ Dated: ________________________

REMEMBER TO ENCLOSE YOUR INSTRUMENTS

IMPORTANT TAX INFORMATION

Under federal tax law, a holder who transmits instruments hereby is required by law to provide the Exchange Agent with such holder’s correct TIN on Substitute Form W-9 below. If such holder is an individual, the TIN is his or her social security number. If the Exchange Agent is not provided with the correct TIN, the holder or other payee may be subject to a $50 penalty imposed by the Internal Revenue Service. In addition, payments that are made to such holder or other payee with respect to instruments may be subject to backup withholding.

Certain holders (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. In order for a foreign individual to qualify as an exempt recipient, that holder must submit to the Exchange Agent a properly completed Internal Revenue Service Form W-8BEN, signed under penalties of perjury, attesting to that holder’s exempt status. A Form W-8BEN can be obtained from the Exchange Agent. A holder should consult with his, her or its tax advisor as to such holder’s qualification for exemption from backup withholding and the procedure for obtaining such exemption.

If backup withholding applies, the Exchange Agent is required to withhold 28% of the value of the New Notes and New Warrants issued to the holder or other payee. Backup withholding is not an additional tax. Rather, the federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service.

Purpose of Substitute Form W-9

To prevent backup withholding on issuances made to a holder or other payee with respect to instruments, the holder is required to notify the Exchange Agent of the holder’s correct TIN by completing the form below, certifying that the TIN provided on Substitute Form W-9 is correct (or that such holder is awaiting a TIN) and that (1) the holder has not been notified by the Internal Revenue Service that the holder is subject to backup withholding as a result of failure to report all interest or dividends or (2) the Internal Revenue Service has notified the holder that the holder is no longer subject to backup withholding, and the holder is a U.S. person (including a U.S. resident alien).

What Number to Give the Exchange Agent

The holder is required to give the Exchange Agent the TIN (e.g., social security number or employer identification number) of the record owner(s) of the instruments.

NOTE: Failure to complete and return Substitute Form W-9 may result in backup withholding of 28% of the value of the New Notes and New Warrants to be issued to you pursuant to the Exchange Offer.

CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER

ON SUBSTITUTE FORM W-9

(See Instruction 7)

SUBSTITUTE FORM W-9 Department of the Treasury Internal Revenue Service Payer’s Request for Taxpayer Identification Number (TIN)	Part 1-- PLEASE PROVIDE YOUR TIN IN THE BOX AT RIGHT. (For most individuals, this is your social security number.) CERTIFY BY SIGNING AND DATING BELOW	Social Security Number(s) _________________________ OR Employer Identification Number: __________________
Part 2-- Certification -- under penalties of perjury, I certify that: (1)1. The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me). (2)2. I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (“IRS”) that I am subject to backup withholding as a result of failure to report all interest or dividends, or (c) the IRS has notified me that I am not longer subject to backup withholding. (3)3. I am a U.S. person (including a U.S. resident alien).
Certification instructions-You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. SIGNATURE___________________________ Date:________________                         ___________________________ (Print Name)		Part 3-- awaiting TIN o

NOTE: You must complete the following instrument if you checked the box in Part 3 of Substitute Form W-9.

Instrument of Awaiting Taxpayer Identification Number

I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (a) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office or (b) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number within sixty (60) days, the New Notes and New Warrants will be withheld until I provide a taxpayer identification number.

_____________________________________________            _________________________

Signature                                                                        Date