EXHIBIT 10.7 AGREEMENT AND PLAN OF MERGER BY AND BETWEEN

EXHIBIT 10.7

AGREEMENT AND PLAN OF MERGER

BY AND BETWEEN

TANISYS TECHNOLOGY, INC.
AND
TANISYS ACQUISITION CORP. II

AND

DARKHORSE SYSTEMS, INC.
AND
XXXX X. XXXXXXXXX,
XXXXXX XXXXXXXX AND
XXXX XXXXXX

Dated as of April 9, 1996

TABLE OF CONTENTS

Page

ARTICLE 1 THE MERGER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.1 The Merger. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.2 Conversion of Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.3 Articles of Incorporation and By-Laws of the Surviving Corporation. . . . . . . . . . 2
Section 1.4 Surrender and Exchange of DarkHorse Common Stock. . . . . . . . . . . . . . . . . . . 2
Section 1.5 Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 1.6 No Further Transfers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

ARTICLE 2 REPRESENTATIONS AND WARRANTIES OF
DARKHORSE AND THE OWNERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.1 Organization; Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.2 Authority Relative to This Agreement. . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 2.3 Capitalization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.4 No Subsidiaries; Absence of Certain Agreements. . . . . . . . . . . . . . . . . . . . 5
Section 2.5 Governmental Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.6 No Violations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.7 Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 2.8 Title to and Condition of Assets and Property . . . . . . . . . . . . . . . . . . . . 6
Section 2.9 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.10 Absence of Changes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.11 Undisclosed Liabilities; Commitments. . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 2.12 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.13 Pension Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 2.14 Labor Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.15 Information for Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.16 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 2.17 Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2.18 Proprietary Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 2.19 Surety and Guarantor Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.20 No Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.21 Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.22 Compliance with Law; Conduct. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.23 Regulatory Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 2.24 Investment Company Act, Etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.25 Public Utility Holding Company Act. . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.26 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.27 Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.28 Accounts Payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.29 Items Reflected in DarkHorse's Disclosure Schedule. . . . . . . . . . . . . . . . . . 12
Section 2.30 Bank Accounts; Powers of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 2.31 Product and Service Warranties. . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 2.32 Transactions with Affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 2.33 Corrupt Practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 2.34 Current Revenue and Net Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 2.35 Absence of Bad Debt or Uncollectible Accounts . . . . . . . . . . . . . . . . . . . . 14
Section 2.36 No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 2.37 Copies of Documents; Accuracy of Information Furnished. . . . . . . . . . . . . . . . 14
Section 2.38 Subchapter "S" Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Page

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF TANISYS . . . . . . . . . . . . . . . . . . . . . . 15
Section 3.1 Organization; Qualification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3.2 Authority Relative to This Agreement. . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 3.3 Capitalization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 3.4 Validity of Shares to Be Issued . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 3.5 Governmental Consents and Approvals . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 3.6 No Violations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 3.7 Financial Statements; British Columbia Securities Commission Reports. . . . . . . . . 17
Section 3.8 Litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.9 Information for Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.10 No Brokers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.11 Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.12 Copies of Documents; Accuracy of Information Furnished. . . . . . . . . . . . . . . . 18

ARTICLE 4 ADDITIONAL REPRESENTATIONS & WARRANTIES OF THE OWNERS
[AND ALL FUTURE OWNER(S), PURSUANT TO SECTION 6.1(g)]. . . . . . . . . . . . . . . . 18
Section 4.1 Title to Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 4.2 Authority Relative to This Agreement. . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 4.3 Certain Transactions or Arrangements. . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.4 Representations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 4.5 Copies of Documents; Accuracy Information Furnished . . . . . . . . . . . . . . . . . 19

ARTICLE 5 ADDITIONAL AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 5.1 Conduct of Business of DarkHorse. . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 5.2 Forbearances by DarkHorse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Section 5.3 No Solicitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 5.4 Investigation of Business and Properties. . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.5 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.6 Public Announcements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.7 Agreement to Consummate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.8 DarkHorse Shareholders' Approval. . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.9 Tanisys Acquisition II Shareholder's Approval . . . . . . . . . . . . . . . . . . . . 22
Section 5.10 Agreement Regarding Brokers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 5.11 Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Section 5.12 Representations, Warranties and Agreements; Survival . . . . . . . . . . . . . . . . 23
Section 5.13 Indemnification by DarkHorse and Owners and Security Agreement. . . . . . . . . . . . 23
Section 5.14 Indemnification by Tanisys. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 5.15 Resale Limitations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

ARTICLE 6 CONDITIONS PRECEDENT TO CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.1 General Conditions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 6.2 Conditions to Closing in Favor of DarkHorse . . . . . . . . . . . . . . . . . . . . . 26
Section 6.3 Conditions to Closing in Favor of Tanisys . . . . . . . . . . . . . . . . . . . . . . 27

iii

Page

ARTICLE 7 TERMINATION, AMENDMENT AND WAIVER . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 7.1 Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 7.2 Effect of Termination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 7.3 Amendment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 7.4 Extension; Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

ARTICLE 8 GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.1 Exclusive Remedy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 8.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 8.3 Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.4 Interpretation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.5 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 8.6 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.7 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 8.9 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

LIST OF EXHIBITS
Exhibit "A" Delaware Articles of Merger
Exhibit "B" Texas Articles of Merger
Exhibit "C" Escrow Agreement
Exhibit "D" Opinions of Counsel for Tanisys
Exhibit "E" Opinion of Counsel for DarkHorse
Exhibit "F" Restricted Stock Investment Letters

LIST OF SCHEDULES
Schedule "A" DarkHorse's Disclosure Schedule
Schedule "B" Tanisys' Disclosure Schedule
Schedule "C" Owners' Disclosure Schedule

AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER ("Agreement") is made as of April 9,
1996, by and between TANISYS TECHNOLOGY, INC., a Wyoming corporation
("Tanisys"), TANISYS ACQUISITION CORP. II, a Delaware corporation and wholly-
owned subsidiary of Tanisys ("Tanisys Acquisition II" and sometimes referred to
as the "Surviving Corporation"), DARKHORSE SYSTEMS, INC., a Texas corporation
("DarkHorse"), and XXXX X. XXXXXXXXX, XXXXXX XXXXXXXX AND XXXX XXXXXX
(collectively, the "Owners").

RECITALS OF THE PARTIES:

WHEREAS, the respective Boards of Directors of Tanisys and DarkHorse have
approved the merger (the "Merger") of DarkHorse with and into Tanisys
Acquisition II in accordance with the laws of the States of Texas and Delaware
and the provisions of this Agreement; and

WHEREAS, Tanisys, DarkHorse and the Owners desire to make certain
representations, warranties and agreements in connection with, and to establish
various conditions precedent to, the Merger.

NOW, THEREFORE, in consideration of the foregoing and the representations,
warranties and agreements contained herein, the parties hereto agree as follows:

ARTICLE 1
THE MERGER

Section 1.1 THE MERGER. Pursuant to the terms of this Agreement,
DarkHorse will be merged with and into Tanisys Acquisition II pursuant to the
laws of the States of Texas and Delaware in the manner and with the effect set
forth herein. Subject to the fulfillment of the conditions precedent contained
in Article 6 of this Agreement, an executed Articles of Merger, the form of
which is attached as EXHIBIT "A" hereto, will be filed with the Secretary of
State of the State of Delaware and an executed Articles of Merger, the form of
which is attached as EXHIBIT "B" hereto, will be filed with the Secretary of
State of the State of Texas as soon as practical following the time when the
last of the conditions precedent set forth in Article 6 of this Agreement shall
have been fulfilled or waived in writing in accordance with such Article, or
such earlier or later date as may be mutually agreeable to Tanisys and
DarkHorse.

Section 1.2 CONVERSION OF SHARES. Upon the latter of the issuance of a
Certificate of Merger by the Secretary of State of the State of Delaware or the
issuance of a Certificate of Merger by the Secretary of State of the State of
Texas (the "Effective Date"), the issued and outstanding shares of common stock,
no par value per share, of DarkHorse (the "DarkHorse Common Stock"), subject to
the fulfillment of the conditions precedent as set forth in Article 6, including
the simultaneous closing of that certain Agreement and Plan of Merger dated
April 9, 1996, by and between Tanisys Technology, Inc., Tanisys Acquisition
Corp. and 1st Tech Corporation and Xxxx X. Xxxxxxxxx and the applicable
statutory provisions with respect to appraisal rights, any

applicable withholding requirements and adjustment as herein provided, shall
be converted into and become, and there shall be paid and issued, in exchange
for the DarkHorse Common Stock an aggregate of 1,500,000 shares of Tanisys
common stock, no par value per share (the "Tanisys Common Stock"), such that
each share of DarkHorse Common Stock outstanding on the Effective Date, not
to exceed 1,500,000 shares of DarkHorse Common Stock in the aggregate, is
exchanged for one (1) share (the "Exchange Ratio") of Tanisys Common Stock,
with any excess shares of DarkHorse Common Stock resulting in a reduction in
the per-share Exchange Ratio. As used in this Agreement, "Merger
Consideration" shall mean the aggregate of 1,500,000 shares of Tanisys Common
Stock exchanged for DarkHorse Common Stock in the Merger at the Exchange
Ratio. Each share of DarkHorse Common Stock held in the treasury of DarkHorse
or by a wholly-owned subsidiary of DarkHorse shall be cancelled as of the
Effective Date and no portion of the Merger Consideration shall be payable
with respect thereto. The Merger Consideration shall be reduced by the
amount otherwise payable or issuable to holders of DarkHorse who exercise
dissenters' rights, if any, in connection with the Merger based upon such
shareholders' ownership of DarkHorse Common Stock outstanding on the
Effective Date. The Exchange Ratio shall be subject to appropriate
adjustment in the event of a stock split, stock dividend or recapitalization
subsequent to the date of this Agreement applicable to shares of DarkHorse
Common Stock or Tanisys Common Stock held of record on or before the
Effective Date.

Section 1.3 ARTICLES OF INCORPORATION AND BY-LAWS OF THE SURVIVING
CORPORATION. The Certificate of Incorporation of Tanisys Acquisition II as in
effect on the Effective Date of the Merger shall be the Certificate of
Incorporation of the Surviving Corporation until same shall be amended in
accordance with law and the Certificate of Incorporation, except that after the
Merger the Surviving Corporation shall operate as DarkHorse Systems, Inc.

The By-Laws of Tanisys Acquisition II as in effect on the Effective Date of
the Merger shall be the By-Laws of the Surviving Corporation until same shall
thereafter be altered, amended or repealed in accordance with law, the
Certificate of Incorporation of the Surviving Corporation or said By-Laws.

The directors of the Surviving Corporation at the Effective Date of the
Merger shall be as follows: Xxxx X. Xxxxxxxx and Xxxx X. Xxxxxxxxx. The
officers of the Surviving Corporation at the Effective Date of the Merger shall
be as follows: President, ; Vice President, ;
Secretary, ; and Treasurer, .

Section 1.4 SURRENDER AND EXCHANGE OF DARKHORSE COMMON STOCK

(a) After the Effective Date, each holder of an outstanding certificate or
certificates theretofore representing shares of DarkHorse Common Stock
(the "DarkHorse Certificates") shall surrender such DarkHorse
Certificates to Tanisys or to such agent or agents (the "Exchange
Agent") as may be designated by Tanisys and shall receive in exchange
therefor, upon satisfaction of customary delivery requirements and
subject to applicable law with respect to the exercise of appraisal
rights, certificates representing the number of whole shares of
Tanisys Common Stock into

which shares of DarkHorse Common Stock have been converted, together
with a check representing the cash adjustments for fractional shares,
if any.

(b) If any certificate evidencing shares of Tanisys Common Stock is to be
issued in a name other than that in which the DarkHorse Certificate
surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the DarkHorse Certificate so
surrendered shall be properly endorsed and otherwise be in proper form
for transfer and that the person requesting such exchange pay to the
Exchange Agent any transfer or other taxes required by reason of the
issuance of a certificate for shares of Tanisys Common Stock in any
name other than that of the registered holder of the DarkHorse
Certificate surrendered or establish to the satisfaction of the
Exchange Agent that such tax has been paid or is not payable.

(c) Until so surrendered and exchanged, each outstanding DarkHorse
Certificate after the Effective Date shall be deemed for all corporate
purposes (other than voting and the payment of dividends or other
distributions as described below) to evidence the number of whole
shares of Tanisys Common Stock into which the shares of DarkHorse
Common Stock represented by such DarkHorse Certificates are to be
converted pursuant to Section 1.2 of this Agreement; provided,
however, that no dividends or other distributions, if any, in respect
to such shares of Tanisys Common Stock, declared after the Effective
Date and payable to holders of record after the Effective Date, shall
be paid to the holders of any unsurrendered DarkHorse Certificates
until such DarkHorse Certificates are surrendered. Subject to the
effect, if any, of applicable law, after the surrender and exchange of
the DarkHorse Certificates, the record holders thereof on the date of
exchange shall be entitled to receive any such dividends or other
distributions without interest thereon, which theretofore have become
payable with respect to the number of whole shares of Tanisys Common
Stock for which such DarkHorse Certificate was exchangeable. Holders
of any unsurrendered DarkHorse Certificates shall not be entitled to
vote until such unsurrendered DarkHorse Certificates are exchanged
pursuant to this Section 1.4. Holders of DarkHorse Common Stock who
exercise appraisal rights in accordance with the provisions of the
Texas Business Corporation Act (the "Texas Act") shall only be
entitled to receive the fair value of their shares of DarkHorse Common
Stock in accordance with Texas Act. Such holders shall not be
entitled to any dividends or other distributions payable on and after
the Effective Date to holders of Tanisys Common Stock with respect to
the shares involved regardless of whether such holders have received
payment for their shares.

(d) Tanisys may, without notice to any person, terminate all exchange
agencies after thirty (30) days following the Effective Date of the
Merger, and thereafter all exchanges, payments and notices provided
for in this Agreement as being made to or by the Exchange Agent shall
be made to or by Tanisys or its transfer agent.

Section 1.5 FRACTIONAL SHARES. No fractional share certificates of
Tanisys Common Stock shall be issued in connection with the conversion of shares
of DarkHorse Common Stock in the Merger, nor will any outstanding fractional
share interest entitle the Owners thereof to vote, to receive dividends or to
exercise any other right of a shareholder of Tanisys. In lieu of any such
fractional shares, any holder of DarkHorse Common Stock shall, upon surrender
thereof, be paid in cash the value of each such fraction, which for this purpose
shall be the product of such fraction multiplied by the average of the per-share
closing prices of Tanisys Common Stock on the Vancouver Stock Exchange (the
"VSE") for the twenty (20) trading days immediately preceding the date that is
ten (10) days prior to the Effective Date, subject to appropriate adjustment in
the event of a stock split, stock dividend or recapitalization applicable to
shares of Tanisys Common Stock held of record on or before the Effective Date to
the extent not reflected in such sale prices.

Section 1.6 NO FURTHER TRANSFERS. On the Effective Date, the stock
transfer books of DarkHorse shall be closed, and no further transfer of
DarkHorse Common Stock shall thereafter be made.

ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF
DARKHORSE AND THE OWNERS

Except as expressly set forth in the Disclosure Schedule, which is attached
hereto as SCHEDULE "A," delivered to Tanisys by DarkHorse and the Owners,
severally, and contemporaneously with the execution hereof ("DarkHorse's
Disclosure Schedule"), DarkHorse hereby represents and warrants to Tanisys, and
the Owners, to their best knowledge and belief hereby represent and warrant to
Tanisys as follows, regardless of what investigations, if any, Tanisys shall
have made prior hereto (for the purpose of this Article 2, "Material" or
"Material Adverse Effect" shall mean an adverse effect in an amount in excess of
$10,000):

Section 2.1 ORGANIZATION; QUALIFICATION. DarkHorse is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Texas. DarkHorse has full corporate power and authority to own and lease all of
the properties and assets it now owns and leases and to carry on its business as
now being conducted. DarkHorse is duly qualified as a foreign corporation and
is in good standing to do business in each jurisdiction in which the property
owned, leased or operated by it or the nature of the business conducted by it
makes such qualification necessary, except where the failure so to qualify would
not have a Material Adverse Effect on the condition (financial or otherwise),
business, assets, liabilities, capitalization, financial position, operations,
results of operations or prospects of DarkHorse. DarkHorse has heretofore
delivered to Tanisys complete and correct copies of its Articles of
Incorporation and By-Laws as such are currently in effect.

Section 2.2 AUTHORITY RELATIVE TO THIS AGREEMENT. DarkHorse has full
corporate power and authority to execute, deliver and perform this Agreement
and, subject to shareholder approval, to consummate the transactions
contemplated hereby. The execution and delivery by DarkHorse of this Agreement,
and the consummation of the transactions contemplated hereby, have been duly

and validly authorized by the Board of Directors of DarkHorse and, except for
approval of the Merger by the shareholders of DarkHorse, no other corporate
proceedings on the part of DarkHorse are necessary with respect thereto. This
Agreement has been duly and validly executed and delivered by DarkHorse and,
subject to shareholder approval, constitutes a legal, valid and binding
obligation of DarkHorse, enforceable against it in accordance with its terms.

Section 2.3 CAPITALIZATION. The authorized capital stock of DarkHorse
consists of 100,000,000 shares of DarkHorse Common Stock, no par value, of
which, as of the date hereof, 1,455,000 shares of DarkHorse Common Stock are
validly issued and outstanding, fully paid and nonassessable. As of the date of
this Agreement, there are no shares of DarkHorse Common Stock held in the
treasury of DarkHorse and there are no other shares of the capital stock of
DarkHorse. As of the date hereof, except as disclosed in DarkHorse's Disclosure
Schedule, there are no outstanding options, warrants, rights or other
commitments to issue or sell any shares of capital stock or any securities or
obligations convertible into or exchangeable for, or giving any person any right
to acquire from DarkHorse, any shares of its capital stock. No shares of
DarkHorse's capital stock have been issued in violation of any preemptive rights
or applicable federal or state securities laws. Except pursuant to the Texas
Act, there are no restrictions, including but not limited to self-imposed
restrictions, on the retained earnings of DarkHorse or on the ability of
DarkHorse to declare and pay dividends. There are no outstanding obligations of
DarkHorse to repurchase, redeem or otherwise acquire any capital stock or other
securities of DarkHorse.

Section 2.4 NO SUBSIDIARIES; ABSENCE OF CERTAIN AGREEMENTS. Except as
disclosed in DarkHorse's Disclosure Schedule, DarkHorse does not have any
Subsidiaries. As used in this Agreement, "Subsidiary" or "Subsidiaries" with
respect to any corporation shall mean any other corporation of which at least a
majority of the securities having by their terms ordinary voting power to elect
a majority of the board of directors of such other corporation is at the time
directly or indirectly owned or controlled by such first corporation, or by such
first corporation and one or more of its Subsidiaries. DarkHorse does not own
or hold any securities of, or any interest in, any other person or entity, nor
is DarkHorse subject to any joint venture, partnership or other arrangement that
is created as a partnership for federal income tax purposes. Except as set
forth in DarkHorse's Disclosure Schedule, there are no voting trusts or other
agreements by and between or among DarkHorse, or any or all of its shareholders,
whether or not DarkHorse is a party thereto, imposing any restrictions upon the
transfer or voting of or otherwise pertaining to the securities of DarkHorse
(including but not limited to the DarkHorse Common Stock) or the ownership
thereof. Any and all such restrictions set forth in DarkHorse's Disclosure
Schedule shall be duly complied with or effectively waived as of the Effective
Date.

Section 2.5 GOVERNMENTAL CONSENTS AND APPROVALS. Except as disclosed in
DarkHorse's Disclosure Schedule, the execution, delivery and performance by
DarkHorse of this Agreement and the consummation of the transactions
contemplated hereby by DarkHorse require no consent, approval, order or
authorization of, action by or in respect of, or registration or filing with,
any federal, state, municipal or other governmental department, commission,
board, bureau, agency, instrumentality, court, or authority ("Governmental
Body"), other than (a) the filing of the Articles of Merger with respect to the
Merger with the Secretary of State of the States of Texas and Delaware; (b) any
applicable filings with and consents and/or approvals of state security

commissions under state securities laws or similar laws; and (c) such other
consents, approvals, permits, authorizations, notifications or filings, the
failure of which to obtain or make would not have a Material Adverse Effect on
DarkHorse or materially adversely affect the ability of DarkHorse to perform its
obligations set forth herein or to consummate the transactions contemplated
hereby.

Section 2.6 NO VIOLATIONS. Except as disclosed in DarkHorse's Disclosure
Schedule, the execution, delivery and performance of this Agreement by
DarkHorse, the consummation by DarkHorse of the transactions contemplated hereby
or compliance by DarkHorse with any of the provisions hereof does not and will
not (a) conflict with or result in any breach or violation of any provision of
the Articles of Incorporation or By-Laws of DarkHorse; (b) result in a default,
or give rise to any right of termination, cancellation or acceleration or loss
of any material benefit (with or without the giving of notice or lapse of time
or both), or require the consent, approval, waiver or other action by any person
under any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, trust (constructive or otherwise), agreement, lease (of real
or personal property) or other instrument or obligation to which DarkHorse is a
party or by which DarkHorse may be bound; (c) result in the creation or
imposition of any claim, lien, pledge, security interest, obligation,
restriction or other encumbrance on any of the property of DarkHorse; or (d)
violate any judgment, order, writ, injunction, decree, statute, rule or
regulation applicable to DarkHorse.

Section 2.7 FINANCIAL STATEMENTS. The financial statements, financial
statement schedules and notes to such financial statements and schedules of
DarkHorse ("the DarkHorse Financial Statements") for the year ended December 31,
1995, and the two (2) months ended February 29, 1996, are materially complete
and correct and were prepared in accordance with generally accepted accounting
principles applied on a consistent basis except as noted in DarkHorse's
Disclosure Schedule, and fairly present the information purported to be shown
therein. All such the DarkHorse Financial Statements have been prepared from
the books and records of DarkHorse, which accurately and fairly reflect the
transactions and dispositions of the assets of DarkHorse. DarkHorse does not
have any liabilities, contingent or otherwise, whether due or to become due,
known or unknown, other than as indicated on the latest balance sheet included
in the DarkHorse Financial Statements. DarkHorse has adequately funded all
accrued employee benefit costs, and such funding is reflected in the balance
sheets included in the DarkHorse Financial Statements.

Section 2.8 TITLE TO AND CONDITION OF ASSETS AND PROPERTY. DarkHorse has
good and marketable title to any and all assets reflected in the DarkHorse
Financial Statements currently owned and used in the operation of its business,
and such assets are free and clear of all liens, claims, charges, security
interests, options, or other title defects or encumbrances, except as set forth
in the DarkHorse Financial Statements or in DarkHorse's Disclosure Schedule.
DarkHorse's Disclosure Schedule further sets forth a description of all real and
personal property currently leased or otherwise occupied or used but not owned
by DarkHorse, true, correct and complete copies of which leases and other
agreements, including all amendments and modifications thereto, have previously
been made available to Tanisys. Each of the leases is a valid and binding
obligation of the parties thereto, and neither DarkHorse nor the lessor
thereunder is in default under, and no condition exists that with notice or
lapse of time or both would constitute a default under, any such lease.
DarkHorse enjoys peaceful and undisturbed possession of its interests under all

such leases. Except as set forth in DarkHorse's Disclosure Schedule, DarkHorse
does not own any real property or any interest therein. All personal property
set forth in DarkHorse's Disclosure Schedule and reflected on the DarkHorse
Financial Statements is owned by DarkHorse and, except as set forth in the
DarkHorse's Disclosure Schedule, all property owned or leased by DarkHorse and
reflected on the DarkHorse Financial Statements or located on the premises of
DarkHorse, is in good operating condition and repair, ordinary wear and tear
excepted, is suitable for the use to which the same is customarily put, is free
from defects other than minor defects that do not interfere with or detract from
the use or value thereof and is merchantable and not obsolete and is of a
quality and quantity presently usable in the ordinary course of the operation of
the business of DarkHorse and is all of the assets currently used or needed in
said business. The buildings, structures, improvements, assets and operations
of DarkHorse materially conform with all applicable restrictive covenants,
deeds, leases, and restrictions and all applicable federal, state and local
laws, ordinances, rules and regulations, including, but not limited to, those
relating to zoning and working conditions.

Section 2.9 LITIGATION. Except as disclosed in DarkHorse's Disclosure
Schedule, there is no action, order, claim, suit, proceeding, litigation,
investigation, inquiry, review or notice ("Proceeding") pending or threatened
against, relating to or affecting DarkHorse, or any of its properties or assets
or any officer or director of DarkHorse, relating to DarkHorse, at law or in
equity, before any Governmental Body, nor to the best of DarkHorse's knowledge
is there any basis for asserting the foregoing. Neither DarkHorse nor any of
its properties or assets is specifically by name subject to any currently
existing order, judgment, writ, decree or injunction. Except as disclosed in
DarkHorse's Disclosure Schedule, DarkHorse is not subject to any currently
existing Proceeding by any Governmental Body.

Section 2.10 ABSENCE OF CHANGES. Since February 29, 1996, except as
disclosed in DarkHorse's Disclosure Schedule, the business of DarkHorse has been
operated in the ordinary course consistent with past practice and there has not
been (a) any Material Adverse change in the business, operations, properties,
condition (financial or otherwise), prospects, assets or liabilities of
DarkHorse (contingent or otherwise, whether due or to become due, known or
unknown); (b) any dividend declared or paid or distribution made on the capital
stock of DarkHorse, or any capital stock of DarkHorse redeemed or repurchased;
(c) any occurrence of long-term debt by DarkHorse; (d) any salary, bonus or
compensation increases to any officers, employees or agents of DarkHorse; (e)
any pending or threatened litigation or disputes affecting DarkHorse; nor (f)
any other change in the nature of, or the manner of conducting, the business of
DarkHorse, other than changes that neither have had, nor reasonably may be
expected to have, a Material Adverse Effect on the business of DarkHorse.

Section 2.11 UNDISCLOSED LIABILITIES; COMMITMENTS. Except as disclosed in
the DarkHorse Financial Statements or in DarkHorse's Disclosure Schedule,
DarkHorse does not have any debts, guaranties, liabilities or obligations,
whether accrued, absolute, contingent or otherwise, and whether due or to become
due, and there is no basis for the assertion against DarkHorse of any such debt,
guaranty, liability or obligation (a) that was not accrued or reserved against
in the DarkHorse Financial Statements; (b) that was incurred after February 29,
1996, other than in the ordinary course of business; or (c) that in the
aggregate has or can reasonably be expected to have a Material

Adverse Effect on DarkHorse. DarkHorse has in all material respects
performed all contracts, agreements and commitments to which it is a party,
and there is not under any such contracts, agreements or commitments any
existing default or event of default or event which with notice or lapse of
time or both would constitute a default.

Section 2.12 ENVIRONMENTAL MATTERS. DarkHorse has duly complied with, and
its business, operations, assets, equipment, leaseholds and other facilities are
in compliance with, the provisions of all federal, state and local
environmental, health and safety laws, codes and ordinances and all rules and
regulations promulgated thereunder, governing (a) air emissions, (b) discharges
to surface water or ground water, (c) solid or liquid waste disposal, (d) the
use, storage, generation, handling, transport, discharge, release, or disposal
of toxic or hazardous substances or wastes, or (e) other environmental, health
or safety matters, including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act of 1980, 42 U.S.C.
Sections 601 ET SEQ., as amended, the Resource Conservation and Recovery Act, 42
U.S.C. Sections 6901 ET SEQ., as amended, the Federal Water Pollution Control
Act, 33 U.S.C. Sections 1251 ET SEQ., as amended, the Clean Air Act, 42 U.S.C.
Sections 7401 ET SEQ., as amended, the Occupational Safety and Health Act of
1970, as amended ("OSHA"), the Safe Drinking Water Act, as amended, the Toxic
Substances Control Act, as amended, the Superfund Amendments and Reauthorization
Act of 1986, as amended, and other environmental conservation or protection
laws. There is no Proceeding pending or threatened against DarkHorse relating
to the environment nor is there a basis for the assertion against DarkHorse of
any Proceeding. Except as disclosed in DarkHorse's Disclosure Schedule,
DarkHorse has not received notice of, and does not know of, any past, present or
future events, conditions, facts, circumstances, activities, practices,
incidents, actions or plans that may interfere with or prevent compliance or
continued compliance or that might constitute a violation of any federal, state
or local environmental, health or safety laws, codes or ordinances, and any
rules or regulations promulgated thereunder, which relate to the use, ownership
or occupancy of the property or the operation of the business of DarkHorse.

Section 2.13 PENSION MATTERS. During the past five years, neither
DarkHorse nor any of its former Subsidiaries has maintained or contributed to
any defined benefit pension plans (as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) or any
multiemployer plans (as defined in Section 3(37)(A) of ERISA). Each employee
benefit plan (as defined in Section 3(3) of ERISA) (each, an "Employee Benefit
Plan" or "Plan") maintained for employees of DarkHorse or any of its former
Subsidiaries to which DarkHorse or any of its former Subsidiaries have
contributed and any related trust agreement, annuity contract or any other
funding or implementing instrument complies currently and has complied in the
past, as to form, operation and administration, with the provisions of ERISA, as
amended, and all other applicable laws, rules and regulations and with the
Internal Revenue Code of 1986, as amended (the "Code"), where required in order
to be tax-qualified under Section 401(a) or 403(a) and 501(a) of the Code, and
no event has occurred that is reasonably likely to give rise to disqualification
of any such Plan under said Sections. All necessary governmental approvals for
the Employee Benefit Plans have been obtained; each Employee Benefit Plan that
is subject thereto meets and has met at all times the minimum funding standards
of Section 302 of ERISA, Section 412 of the Code and any other applicable law,
and no accumulated funding deficiency, whether or not waived, exists with
respect to any such Plan; each Employee Benefit Plan that is an employee pension
benefit plan

(as defined in Section 3(2)(A) of ERISA) has been duly authorized by the
Board of Directors of DarkHorse and a favorable determination as to the
qualification under the Code of each such employee pension benefit plan has
been made by the Internal Revenue Service.

Section 2.14 LABOR MATTERS. Except as set forth in DarkHorse's Disclosure
Schedule, DarkHorse does not have any obligations, contingent or otherwise,
under any employment or consulting agreement, or collective bargaining agreement
or other contract with a labor union or other labor or employee group. There
are no efforts presently being made or threatened by or on behalf of any labor
union with respect to the employees of DarkHorse. DarkHorse is in material
compliance with all federal, state or other applicable laws, domestic or
foreign, regarding employment and employment practices, terms and conditions of
employment and wages and hours, and has not and is not engaged in any unfair
labor practice. No unfair labor practice complaint against DarkHorse is pending
or threatened before the National Labor Relations Board. There is no labor
strike, dispute, slowdown or stoppage pending or threatened against or involving
DarkHorse. No representation question exists respecting the employees of
DarkHorse. No employment-related grievance or internal or informal complaint or
liability with respect to the termination of any employee, consultant or agent
exists. No arbitration proceeding arising out of or under any collective
bargaining agreement is pending, and no claim therefor has been asserted. No
collective bargaining agreement is currently being negotiated by DarkHorse, and
DarkHorse has not experienced any material labor difficulty. There has not
been, and there will not be, any adverse change in relations with employees of
DarkHorse as a result of any announcement or consummation of the transactions
contemplated by this Agreement. No employee of DarkHorse is in violation of any
term of any employment contract, or any other contract or agreement with or any
restrictive covenant or any other common law obligation to a former employer
relating to the right of any such employee to be employed by DarkHorse because
of the nature of the business conducted or to be conducted by DarkHorse or to
the use of trade secrets or proprietary information of others, and the
employment of DarkHorse's employees does not subject DarkHorse to liability in
connection with such covenants or agreements. There is neither pending nor
threatened Proceedings with respect to any contract, agreement, covenant or
obligation referred to above, nor is there any basis for asserting the
foregoing.

Section 2.15 INFORMATION FOR FILINGS. None of the information supplied or
to be supplied by DarkHorse for inclusion, or included, in any documents to be
filed with any regulatory authority in connection with the transactions
contemplated hereby will, at the respective times such documents are filed with
any such regulatory authority, be false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make the
information therein not misleading.

Section 2.16 TAXES. All taxes, assessments and other governmental charges
that are due and payable, other than those presently payable without penalty or
interest, have been timely paid, and DarkHorse has timely filed (and, through
the Effective Date, will timely file) all federal, state and other tax returns
required by law to be filed by it. All such tax reports or returns are true,
complete and correct in all respects with regard to DarkHorse for the periods
covered thereby. DarkHorse is not delinquent in the payment of any material
tax, assessment or governmental charge, there is no tax deficiency asserted
against DarkHorse, and, except as provided above, there

is no unpaid assessment, deficiency or delinquency in the payment of any of
the taxes of DarkHorse or, to the best knowledge of DarkHorse, any proposal
for additional taxes or any violation of any federal, state, local or foreign
tax law that could be asserted by any taxing authority, nor is there any
basis for asserting such authority. There are no tax liens upon any
properties or assets of DarkHorse. Except as disclosed in DarkHorse's
Disclosure Schedule, no Internal Revenue Service, state or local, audit,
investigation or Proceeding of DarkHorse is pending or threatened, and the
results of any completed audits are properly reflected in the DarkHorse
Financial Statements. DarkHorse has not granted any extension to any taxing
authority of the limitation period during which any tax liability may be
asserted. DarkHorse has not committed any material violation of any federal,
state, local or foreign tax laws. All monies required for the payment of
taxes not yet due and payable with respect to the operations of DarkHorse
through and including the Merger date have been approved, reserved against
and entered upon the books and the DarkHorse Financial Statements. All
monies required to be withheld by DarkHorse from employees or collected from
customers for income taxes, social security and unemployment insurance taxes
and sales, excise and use taxes, and the portion of any such taxes to be paid
by DarkHorse to governmental agencies or set aside in accounts for such
purpose have been approved, reserved against and entered upon the books and
the DarkHorse Financial Statements.

Section 2.17 INVENTORY. Except as disclosed in DarkHorse's Disclosure
Schedule, the amount of inventory, as reflected in the DarkHorse Financial
Statements, is stated at the lower of cost or market with appropriate reserves
taken for slow moving and obsolete items. No item included in the inventories,
materials or supplies of DarkHorse is pledged as collateral or held on
consignment from others. All such inventory items are standard quality goods
saleable in the ordinary course of business.

Section 2.18 PROPRIETARY RIGHTS. DarkHorse owns or validly licenses the
right to use all technology, proprietary information, know-how, ideas (patented
or unpatented), data, licenses, customer lists, processes, formulas, trade
secrets, telephone numbers, computer software, computer programs, designs,
inventions, trademarks, trademark registrations and applications therefor,
registered and common law copyrights, and registered copyright applications,
trade names (whether or not registered or registrable), service marks, service
xxxx registrations and applications therefor (collectively, the "Proprietary
Rights") necessary to conduct the business of DarkHorse as the business is
presently being conducted. DarkHorse's Disclosure Schedule sets forth a
complete and correct list (including, where applicable, registration numbers and
dates of filing, renewal and termination) of all Proprietary Rights. Tanisys
and each of its Subsidiaries shall have at all times after the Effective Date
the exclusive right to use the Proprietary Rights necessary to continue to
conduct the business of DarkHorse as the business is presently being conducted.
No consent of any third party will be required for the use of the Proprietary
Rights by Tanisys or any of its Subsidiaries after the Effective Date. No claim
or opposition has been asserted by any person or entity to the ownership of or
DarkHorse's right to use any of the Proprietary Rights or challenging or
questioning the validity or effect of any license or agreement relating thereto,
and there is no valid basis for any such claim or assertion. DarkHorse has
ownership of, or valid licenses to use all of, the Proprietary Rights. Each of
the Proprietary Rights is valid and subsisting, has not been cancelled,
abandoned or otherwise terminated and, if applicable, has been duly asserted,
registered and filed. The Proprietary Rights owned by DarkHorse are owned free
and clear of all liens,

charges or encumbrances. DarkHorse has taken all reasonable steps to
establish and preserve its ownership of all Proprietary Rights. Use by
Tanisys or any of its Subsidiaries of the Proprietary Rights will not, and
the conduct of the business as presently conducted does not, infringe on or
violate the rights of any other person or entity. No Proceedings have been
instituted, are pending or are threatened that challenge or oppose the rights
of DarkHorse with respect to any of the Proprietary Rights. DarkHorse has
not received any notice or inquiry from any person or entity of any alleged
infringement by DarkHorse. DarkHorse has not given and is not bound by any
agreement of indemnification in connection with any Proprietary Rights or
product or service sold or performed by DarkHorse. DarkHorse is not aware of
any infringement by others of its Proprietary Rights. Set forth in
DarkHorse's Disclosure Schedule is a list of all confidentiality agreements
entered into by DarkHorse relating to the Proprietary Rights and all such
contracts are in full force and effect.

Section 2.19 SURETY AND GUARANTOR OBLIGATIONS. Except as set forth in
DarkHorse's Disclosure Schedule, DarkHorse is not obligated as surety,
indemnitor nor guarantor under any surety or similar bond or other contract
issued and has not entered into any agreement to assure payment, performance or
completion of performance of any undertaking or obligation of any person or
entity.

Section 2.20 NO BROKERS. Except as set forth in DarkHorse's Disclosure
Schedule, DarkHorse has not employed any broker, agent or finder or incurred any
liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated hereby.

Section 2.21 RECORDS. The respective minute books, books of account,
stock record books and other records of DarkHorse, all of which have been or
will be made available to Tanisys, contain accurate and complete records of all
corporate actions of the shareholders and Board of Directors (and committees
thereof) during the periods of time in which such minute books were maintained.

Section 2.22 COMPLIANCE WITH LAW; CONDUCT. DarkHorse has not violated or
failed to comply with any statute, law, ordinance, regulation, rule or order of
any foreign, federal, state or local government or agency or any other
Governmental Body, or any judgment, order, writ, injunction or decree of any
court or agency, applicable to its business or operation, except where such
violations or failure to comply would not have a Material Adverse Effect on
DarkHorse. DarkHorse's business is in material conformity with all federal,
state and local energy, public utility, health and OSHA requirements and all
other federal, state and local governmental and regulatory requirements.
DarkHorse has all permits, licenses, authorizations, consents, approvals and
franchises from governmental agencies required to conduct its business as now
being conducted.

Section 2.23 REGULATORY COMPLIANCE. DarkHorse complies in all material
respects with all state and federal rules and regulations governing its
business, including, but not limited to, the terms and conditions within each
order granting jurisdictional authority and all related tariffs.

Section 2.24 INVESTMENT COMPANY ACT, ETC. DarkHorse is not an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, as amended, or an "investment adviser"
within the meaning of the Investment Advisers Act of 1940, as amended.

Section 2.25 PUBLIC UTILITY HOLDING COMPANY ACT. DarkHorse is not a
"public utility," a "holding company," an "affiliate" of a "holding company" or
a "subsidiary company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, as amended, or a "public utility" within
the meaning of the Federal Power Act, as amended.

Section 2.26 INSURANCE. Contained in DarkHorse's Disclosure Schedule is a
complete and accurate description of all insurance maintained by DarkHorse with
respect to the assets, properties and business of DarkHorse. All of the
insurable properties of DarkHorse are insured for their benefit under valid and
enforceable policies, issued by insurers rated AA or better by A.M. Best
Company. The insurance maintained by DarkHorse is in amounts and of a nature as
is customarily maintained by persons conducting operations similar to those of
DarkHorse.

Section 2.27 RECEIVABLES. DarkHorse's Disclosure Schedule contains a
complete and accurate list of all DarkHorse's receivables (including accounts
receivables, loan receivables and advances) at February 29, 1996, including all
liens and encumbrances attached to DarkHorse's Disclosure Schedule, showing the
name of each account debtor and the amount due from each by invoice number and
date. All of such accounts receivable and all accounts receivable since the
date thereof have arisen in the ordinary course of business for products
delivered or services rendered. DarkHorse is not aware of any event or
condition with respect to a specific customer that causes it to believe that any
such receivable will not be collected in full in due course without resort to
litigation and will not be subject to counterclaim or setoff. The reserves for
doubtful accounts reflected on the DarkHorse Financial Statements have been
determined in accordance with generally accepted accounting principles and past
practice consistently applied and adequately provide for all uncollectible
receivables.

Section 2.28 ACCOUNTS PAYABLE. DarkHorse's Disclosure Schedule contains a
complete and accurate list of all DarkHorse's accounts payable at February 29,
1996, showing the name of each account creditor and the amount due to each by
invoice number and date.

Section 2.29 ITEMS REFLECTED IN DARKHORSE'S DISCLOSURE SCHEDULE.
DarkHorse's Disclosure Schedule contains a complete and accurate list or brief
description of (a) all current or pending contracts, commitments and leases (of
real or personal property), written or otherwise, between DarkHorse and any
party that involve, in the aggregate, the payment or receipt by DarkHorse of
more than $10,000, which cannot be cancelled without penalty upon thirty (30)
days' notice, or which otherwise are material to DarkHorse; (b) all of the
Proprietary Rights; (c) all employee benefit programs (including but not limited
to medical, profit-sharing or pension plans), employee bonus and incentive
compensation arrangements and accrued and unused vacation time as of December
31, 1995, of DarkHorse; (d) any compensation, noncompetition, severance,
consulting, or confidentiality agreements between DarkHorse and any of
DarkHorse's executive officers for the last two fiscal years and at present; (e)
the number and job category of all current

employees of DarkHorse, including with respect to key employees, their names,
date of employment, current compensation (including sales commissions) and
date and amount of last increase in compensation; (f) all capital assets of
DarkHorse with a book value greater than $10,000, setting forth any liens or
restrictions thereon; (g) federal and state income tax returns for the last
three fiscal years; (h) a list of all leases, contracts or agreements for
which consents of any private persons or public authorities would be required
(citing the section(s) thereof requiring such consents) for the consummation
of the transactions contemplated hereby, or for the preventing of any
termination of any material right, privilege, license or agreement of, or any
loss or disadvantage to, DarkHorse or Tanisys upon consummation of the
transactions contemplated hereby; (i) all governmental licenses and permits
relating to any of DarkHorse's operations; (j) any arrangements or agreements
of DarkHorse with its competitors; and (k) the twenty largest customers of
DarkHorse and the twenty largest suppliers to DarkHorse for the fiscal year
ended December 31, 1995, and for the period from January 1, 1996, to February
29, 1996. DarkHorse has not received notice of and does not have any
knowledge or reason to believe that any customer listed in DarkHorse's
Disclosure Schedule is seeking or presently intends to seek to terminate its
agreement with DarkHorse or that any such customer will not renew its
existing agreement with DarkHorse on the expiration date thereof on terms at
least as favorable to DarkHorse as those currently in effect.

Section 2.30 BANK ACCOUNTS; POWERS OF ATTORNEY. DarkHorse's Disclosure
Schedule completely and accurately lists the name of each bank, brokerage firm
or other financial institution in which DarkHorse has an account or possesses a
safe deposit box and sets forth the amount and nature of all cash and cash
equivalents contained therein at February 29, 1996. DarkHorse's Disclosure
Schedule also lists the names of all persons authorized to draw thereon, or to
have access thereto or to authorize transactions therein, and the names of all
parties, if any, holding powers of attorney from DarkHorse with respect thereto
or with respect to any other matter, and the account number of any such account.
DarkHorse does not maintain any securities or commodity trading account or other
brokerage account.

Section 2.31 PRODUCT AND SERVICE WARRANTIES. Except as disclosed in
DarkHorse's Disclosure Schedule, there is no claim against or liability of
DarkHorse on account of product or service warranties or with respect to the
manufacture, sale or lease of products or performance of services, and there is
no basis for any such claim on account of products heretofore manufactured, sold
or leased or services performed that has not been accrued or reserved against on
Tech's Financial Statements in accordance with the generally accepted accounting
principles.

Section 2.32 TRANSACTIONS WITH AFFILIATES. Except as set forth in
DarkHorse's Disclosure Schedule, DarkHorse has not engaged in any loans, leases,
contracts or other transactions with any director, officer or key employee of
DarkHorse, or any member of any such individual's immediate family or any other
Affiliate of DarkHorse. As used in this Agreement, "Affiliate" shall mean, with
respect to any person or entity, any other person or entity directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, such person or entity. A person or entity shall be deemed to
control another person or entity if such person or entity possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of such other person or entity, whether through the ownership of voting
securities, by contract or otherwise. Immediately prior to the Effective Date,
all advances or loans made by DarkHorse to any

shareholder, officer, director, employee, Affiliate or agent of DarkHorse
will have been repaid in full, with accrued interest to the date of repayment.

Section 2.33 CORRUPT PRACTICES. Since the inception of DarkHorse, there
have been no violations of the Foreign Corrupt Practices Act or any similar
state or federal statute relating to bribery or similar offenses by DarkHorse or
any of its Subsidiaries or former Subsidiaries or any of their agents. Neither
DarkHorse, its Subsidiaries or former Subsidiaries, nor any officer, director,
employee or agent of DarkHorse or any Subsidiaries or former Subsidiary (or any
person acting on behalf of any of the foregoing) has since the date of
DarkHorse's incorporation, given or agreed to give any gift or similar benefit
of more than nominal value to any customer, supplier, governmental employee or
official, or any other person or entity who is or may be in a position to help
or hinder DarkHorse or any of such Subsidiaries or assist DarkHorse or any of
such Subsidiaries in connection with any actual or proposed transaction, which
gift or similar benefit, if not given in the past, would have a Material Adverse
Effect, or which would subject DarkHorse or any of such Subsidiaries to material
penalty in any private or governmental Proceeding.

Section 2.34 CURRENT REVENUE AND NET INCOME. DarkHorse's gross revenues
and net income calculated in accordance with generally accepted accounting
principles, applied on a consistent basis (except as noted in Section 2.7 of
DarkHorse's Disclosure Schedule), for the twelve (12)-month period ended
December 31, 1995, was at least $3,047,700 and $500,600, respectively, and the
gross revenue and net income for the two (2)-month period ending February 29,
1996, was at least $647,399 and $180,773, respectively. Revenues and net income
are exclusive of any benefit from the delivery of evaluation units. Evaluation
units are those units delivered on a trial basis where the buyer is not
obligated to pay the sale amount.

Section 2.35 ABSENCE OF BAD DEBT OR UNCOLLECTIBLE ACCOUNTS. At February
29, 1996, except as disclosed in the DarkHorse Financial Statements, DarkHorse
had no bad debt or uncollectible account accrual, and there were no facts
existing on such date that would provide any reason for the establishment of
such an accrual.

Section 2.36 NO DEFAULT. Except as disclosed on DarkHorse's Disclosure
Schedule, DarkHorse is not in default under, and no condition exists that with
notice or lapse of time or both would constitute a default under (a) its
Articles of Incorporation or By-Laws; (b) any mortgage, loan, agreement,
contract, arrangement, lease, lease purchase, indenture or other evidences of
indebtedness for borrowed money or other instrument to which DarkHorse is now a
party or by which DarkHorse or any of the assets of DarkHorse is bound; or (c)
any judgment, order, writ, injunction or decree, of any court, arbitrator,
agency, official, authority or other Governmental Body.

Section 2.37 COPIES OF DOCUMENTS; ACCURACY OF INFORMATION FURNISHED.
DarkHorse has delivered or made available to Tanisys complete and accurate
copies of all documents listed in DarkHorse's Disclosure Schedule. All of the
Exhibits and Schedules provided by DarkHorse are true, correct and complete in
all material respects, and no written representation, warranty or statement made
by DarkHorse in or pursuant to this Agreement contains or will contain any
untrue statement of a material fact or omits or will omit to state any material
fact necessary to make such

representation, warranty or statement not misleading to Tanisys, who is
seeking complete and accurate information with respect to DarkHorse.

Section 2.38 SUBCHAPTER "S" ELECTION. DarkHorse and the Owners hereby
represent and warrant that DarkHorse is a reporting Subchapter "S" corporation
with the Internal Revenue Service, and that DarkHorse is treated, from a tax
reporting standpoint under the rules and regulations, as a Subchapter "S"
corporation of the Internal Revenue Code, and that the Owners shall be
responsible for any prior year or existing taxes.

ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF TANISYS

Except as set forth in the Disclosure Schedule, which is attached hereto as
SCHEDULE "B," delivered to DarkHorse by Tanisys contemporaneously with the
execution hereof ("Tanisys' Disclosure Schedule"), Tanisys hereby represents and
warrants to DarkHorse as follows, regardless of what investigations, if any,
DarkHorse shall have made prior hereto (for the purpose of this Article 3,
"Material" or "Material Adverse Effect" shall mean an adverse effect in an
amount in excess of $10,000):

Section 3.1 ORGANIZATION; QUALIFICATION. Tanisys is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Wyoming. Tanisys has full corporate power and authority to own and lease all of
the properties and assets it now owns and leases and to carry on its business as
now being conducted. Tanisys is duly qualified as a foreign corporation and is
in good standing to do business in each jurisdiction in which the property
owned, leased or operated by it or the nature of the business conducted by it
makes such qualification necessary, except where the failure so to qualify would
not have a Material Adverse Effect on Tanisys and its Subsidiaries taken as a
whole. Tanisys has previously delivered and made available to DarkHorse a true
and correct copy of its Articles of Continuance and By-Laws.

Section 3.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Tanisys has full
corporate power and authority to execute, deliver and perform this Agreement
and, subject to approval by the shareholders of Tanisys and Tanisys Acquisition,
to consummate the transactions contemplated hereby. The execution and delivery
by Tanisys of this Agreement, and the consummation of the transactions
contemplated hereby, have been duly and validly authorized by the Board of
Directors of Tanisys and, except for the approval of the Merger by the
shareholders of Tanisys and Tanisys Acquisition, no other corporate proceedings
on the part of Tanisys are necessary with respect thereto. Tanisys Acquisition
II will take or cause to be taken all corporate action that is necessary for
Tanisys Acquisition II to execute and file the Articles of Merger with the
Secretary of State of Texas, to execute and file the Articles of Merger with the
Secretary of State of Delaware and to complete the transactions to be completed
by Tanisys Acquisition II pursuant to this Agreement. This Agreement has been
duly and validly executed and delivered by Tanisys and constitutes a legal,
valid and binding obligation of Tanisys, enforceable against it in accordance
with its terms.

Section 3.3 CAPITALIZATION. The authorized capital stock of Tanisys
consists of 50,000,000 shares of Tanisys Common Stock, no par value, and
10,000,000 shares of preferred stock, par value $1.00 per share, of which, as of
the date hereof, 10,256,037 shares of Tanisys Common Stock and no shares of
Tanisys Preferred Stock are validly issued and outstanding, fully paid and
nonassessable. No shares of Tanisys' Capital Stock have been issued in
violation of any preemptive rights. Except as set forth in Tanisys' Disclosure
Schedule, there are no outstanding obligations of Tanisys to repurchase, redeem
or otherwise acquire any capital stock or other securities of Tanisys. There are
no voting trusts or other agreements, including shareholder agreements or other
understandings, to which Tanisys or any of its Subsidiaries is a party with
respect to the voting of the capital stock of Tanisys or any of its
Subsidiaries. In addition to the outstanding shares of Tanisys Common Stock as
noted above, there are outstanding options to purchase 1,441,700 shares of
Tanisys Common Stock at exercise prices ranging from $1.10 to $3.72 and
outstanding warrants to purchase 3,225,177 shares of Tanisys Common Stock at
exercise prices ranging from $1.25 to $2.30.

Section 3.4 VALIDITY OF SHARES TO BE ISSUED. The shares of Tanisys Common
Stock to be issued to the shareholders of DarkHorse as a result of the Merger
have been duly authorized and, upon delivery thereof pursuant to the provisions
of this Agreement, will be validly issued and outstanding, fully paid and non-
assessable, not subject to any preemptive rights, and issued in compliance with
applicable securities laws. Such shares will be "restricted securities" and
will not be registered with the VSE or the Securities & Exchange Commission
under the Securities Act of 1933, as amended or qualified for resale pursuant to
the Securities Act (British Columbia).

Section 3.5 GOVERNMENTAL CONSENTS AND APPROVALS. Except as set forth in
Tanisys' Disclosure Schedule, the execution, delivery and performance by Tanisys
of this Agreement and the consummation of the transactions contemplated hereby
by Tanisys or its Subsidiaries require no consent, approval, order or
authorization of, action by or in respect of, or registration or filing with,
any Governmental Body, court, agency, or authority, other than (a) the filing of
the Articles of Merger with the Secretary of the States of Texas and Delaware
with respect to the Merger; (b) any applicable filings with the VSE and consents
and/or approvals with the VSE or state securities commissions under state
securities laws or similar laws; (c) the consent of Tanisys and Tanisys
Acquisition II shareholders; and (d) consents, permits, authorizations,
notifications or filings the failure of which to obtain or make would not, when
considered together, have a Material Adverse Effect on Tanisys and its
Subsidiaries taken as a whole or materially adversely affect the ability of
Tanisys to perform its obligations set forth herein or to consummate the
transactions contemplated hereby.

Section 3.6 NO VIOLATIONS. Except as set forth in Tanisys' Disclosure
Schedule, the execution, delivery and performance of this Agreement by Tanisys,
the consummation by Tanisys of the transactions contemplated hereby or
compliance by Tanisys with any of the provisions hereof does not and will not
(a) conflict with or result in any breach or violation of any provision of the
Articles of Incorporation or By-Laws of Tanisys or any of its Subsidiaries; (b)
result in a default, or give rise to any right of termination, cancellation or
acceleration, or loss of any material benefit (with or without the giving of
notice or lapse of time or both), or require the consent, approval, waiver or
other action of any person, under any of the terms, conditions or provisions of
any note,

xxxx, xxxxxxxx, xxxxxxxxx, license, trust (constructive or otherwise),
agreement, lease or other instrument or obligation to which Tanisys or any of
its Subsidiaries is a party or by which Tanisys or any of its Subsidiaries may
be bound other than that which has been or will be obtained; (c) result in the
creation or imposition of any claim, lien, pledge, security interest,
obligation, restriction or other encumbrance on any of the property of Tanisys
or any of its Subsidiaries; or (d) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to Tanisys or any of its Subsidiaries.
The transactions contemplated by this Agreement will not conflict with the VSE
rules and regulations.

Section 3.7 FINANCIAL STATEMENTS; BRITISH COLUMBIA SECURITIES COMMISSION
REPORTS. The financial statements and notes to such financial statements of
Tanisys (the "Tanisys Financial Statements") contained in Tanisys' quarterly
Form 61 Report for the fiscal year ended September 30, 1995 and each quarter
thereafter filed with the British Columbia Securities Commission are complete
and correct and were prepared in accordance with generally accepted accounting
principles applied on a consistent basis except as noted therein, and fairly
present the information purported to be shown therein. All Tanisys Financial
Statements have been prepared from the books and records of Tanisys and its
Subsidiaries, which accurately and fairly reflect the transactions and
dispositions of the assets of Tanisys and its Subsidiaries. Neither Tanisys nor
any of its Subsidiaries had any liabilities, contingent or otherwise, whether
due or to become due, known or unknown, other than as indicated on the latest
balance sheets included in The Tanisys Financial Statements. Tanisys has
adequately funded all accrued employee benefit costs, and such funding is
reflected in the balance sheets included in The Tanisys Financial Statements.

Section 3.8 LITIGATION. Except as disclosed in Tanisys' Disclosure
Schedule, there is no Proceeding pending or, to the knowledge of Tanisys,
threatened against, relating to or affecting Tanisys or any officer or director
of Tanisys or its Subsidiaries relating to Tanisys or its Subsidiaries, at law
or in equity, before any Governmental Body nor, to the knowledge of Tanisys, is
there any basis for asserting the foregoing. Neither Tanisys, any of its
Subsidiaries nor any of their respective properties or assets is specifically by
name subject to any currently existing order, judgment, writ, decree or
injunction.

Section 3.9 INFORMATION FOR FILINGS. None of the information supplied or
to be supplied by Tanisys and its Subsidiaries for inclusion or included in any
documents to be filed with any regulatory authority in connection with the
transactions contemplated hereby will, at the respective time such documents are
filed with such regulatory authority, be false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make the
statements therein in light of the circumstances under which they were made, not
misleading.

Section 3.10 NO BROKERS. Except as disclosed on Tanisys' Disclosure
Schedule, Tanisys has not employed any broker, agent or finder or incurred any
liability for any brokerage fees, commissions or finders' fees in connection
with the transactions contemplated hereby.

Section 3.11 RECORDS. The respective minute books, books of account,
stock record books and other records of Tanisys and each of its Subsidiaries,
all of which have been or will be made available to DarkHorse, contain
materially accurate and complete records of all corporate actions of

the respective shareholders and Boards of Directors (and committees thereof)
during the periods of time in which such minute books were maintained.

Section 3.12 COPIES OF DOCUMENTS; ACCURACY OF INFORMATION FURNISHED.
Tanisys has delivered or made available to DarkHorse complete and accurate
copies of all documents listed in Tanisys' Disclosure Schedule. All of the
Exhibits and Schedules provided by Tanisys are true, correct and complete in all
material respects, and no written representation, warranty or statement made by
Tanisys in or pursuant to this Agreement contains or will contain any untrue
statement of a material fact or omits or will omit to state any material fact
necessary to make such representation, warranty or statement not misleading to
DarkHorse, who is seeking complete and accurate information with respect to
Tanisys and its Subsidiaries.

ARTICLE 4
ADDITIONAL REPRESENTATIONS & WARRANTIES OF THE OWNERS
[AND ALL FUTURE OWNER(S) PURSUANT TO SECTION 6.1(g)]

Except as set forth in the Disclosure Schedule, which is attached hereto as
SCHEDULE "C," delivered to Tanisys and DarkHorse by the Owners contemporaneously
with the execution hereof and by future Owner(s) as defined in Section 6.1(g)
herein, (the "Owners' Disclosure Schedule"), the Owners hereby represents and
warrants to Tanisys and DarkHorse as follows, which representations and
warranties are made as of the date hereof and as of the Effective Date and shall
survive the Closing (as defined in Section 8.7 below) regardless of what
investigations, if any, Tanisys or DarkHorse shall have made thereof prior
thereto:

Section 4.1 TITLE TO SHARES. Immediately prior to the Closing, the Owners
shall be the lawful Owners and holder of an aggregate of no more than 1,500,000
shares of DarkHorse Common Stock, and, on the Effective Date, shall hold all
such shares free and clear of any encumbrances or liens.

Section 4.2 AUTHORITY RELATIVE TO THIS AGREEMENT. This Agreement has been
duly and validly executed and delivered by the Owners and constitutes the legal,
valid and binding obligation of the Owners, enforceable in accordance with its
terms, except as enforcement hereof may be limited by bankruptcy, insolvency,
fraudulent conveyance, moratorium or other similar laws affecting enforcement of
creditors' rights generally. The execution, delivery and performance by the
Owners of this Agreement and the consummation of the transactions contemplated
hereby will not violate any provision of any law to which the Owners is subject
nor result in a breach or violation by the Owners of any of the terms or
provisions of, or constitute a default by the Owners under any note, bond,
mortgage, indenture, license, trust (constructive or other), agreement, lease,
or other instrument or obligation to which the Owners is a party or by which the
Owners is bound. The Owners is not a party to, or subject to, or bound by, any
currently existing order, judgment, injunction, writ or decree of any court or
governmental authority, or any arbitration award that would restrict performance
by each Owners of this Agreement or such other documents or instruments to be
executed or delivered by the Owners in conjunction herewith.

Section 4.3 CERTAIN TRANSACTIONS OR ARRANGEMENTS. Except for agreements
and transactions entered into in connection with this Agreement and except as
set forth in the Owners' Disclosure Schedule, the Owners is not presently,
directly or indirectly, a party to any transaction with DarkHorse, including
without limitation (a) any contract, agreement, understanding or commitment or
other arrangement providing for the furnishing of services by, rental of real or
personal property from or otherwise requiring payments to the Owners or any
Affiliate of the Owners; (b) any contract, agreement, understanding, commitment
or other arrangement relating to the employment of the Owners by the Company, or
any bonus, deferred compensation, pension, profit sharing, stock option,
employee stock purchase, retirement or other employee benefit plan; or (c) any
loans or advances to or from DarkHorse.

Section 4.4 REPRESENTATIONS. The Owners has reviewed the representations,
warranties and statements made by DarkHorse in this Agreement and DarkHorse's
Disclosure Schedule, and, to the best knowledge and belief of the Owners, such
representations and warranties do not contain any untrue statement of a material
fact or omit to state any material fact necessary to make any such
representation, warranty or statement not misleading. (The term "best knowledge
and belief" as used herein shall mean that information actually known to the
Owners and specifically excludes constructive knowledge and any duty to inquire
about relevant information.)

Section 4.5 COPIES OF DOCUMENTS; ACCURACY OF INFORMATION FURNISHED. The
Owners has delivered or made available to Tanisys and DarkHorse complete and
accurate copies of all documents listed in the Owners' Disclosure Schedule. All
the Exhibits and Schedules provided by the Owners are true, correct and complete
in all material respects, and no written representation, warranty or statement
made by the Owners in or pursuant to this Agreement contains or will contain any
untrue statement of a material fact or omits or will omit to state any material
fact necessary to make such representation, warranty or statement not misleading
to Tanisys or DarkHorse, who are seeking complete and accurate information with
respect to DarkHorse and the Owners.

ARTICLE 5
ADDITIONAL AGREEMENTS

Section 5.1 CONDUCT OF BUSINESS OF DARKHORSE. After the date hereof and
prior to the Effective Date, DarkHorse shall conduct its operations according to
its normal course of business to preserve intact its business organization, keep
available the services of its officers and employees, preserve and maintain
satisfactory relationships and goodwill with licensors, suppliers, dealers,
customers and all others having business relationships with it, pay the
suppliers, vendors and taxing authorities of DarkHorse in accordance with its
usual business practices and in a timely fashion and continue to service and
maintain all of its assets in a manner consistent with past practice.

Section 5.2 FORBEARANCES BY DARKHORSE. Except as contemplated by this
Agreement, DarkHorse shall not, after the date hereof and prior to the Effective
Date, without the prior written consent of Tanisys:

(a) Issue additional capital stock or any additional securities or
obligations convertible into or exchangeable for, or giving any person
any right to acquire, capital stock;

(b) Acquire any shares of its capital stock;

(c) Declare or pay any dividend, except a cash distribution to cover the
individual tax liabilities of the Owners for the year 1995 and for
that period from January 1, 1996 through the closing;

(d) Issue any stock options, stock appreciation rights, warrants or any
other rights relating to the securities of DarkHorse;

(e) Sell any assets not in the ordinary course of business;

(f) Issue or incur additional debt for borrowed money other than pursuant
to existing credit agreements;

(g) Mortgage, pledge or otherwise encumber any of its properties or
assets;

(h) Make any investment in third parties or assets of a capital nature
either by purchasing stock, securities or assets, contributing to
capital, transferring property or otherwise making any investment;

(i) Make any commitments for capital expenditures or other commitment or
transaction other than in the ordinary course of business;

(j) Increase in any manner, whether by bonus or otherwise, the
compensation of any of its officers or employees;

(k) Amend its Articles of Incorporation or By-Laws except as may be
necessary to facilitate the consummation of the transactions
contemplated by this Agreement;

(l) Undertake any action that will reduce DarkHorse's working capital, as
determined by generally accepted accounting principles, to an amount
lower than the working capital of DarkHorse at February 29, 1996, and
previously furnished to Tanisys except as provided for under Section
5.2(c); or

(m) Enter into any agreement to do any of the things described in clauses
(a) through (l) above.

Section 5.3 NO SOLICITATION. DarkHorse, its officers and directors, and
the Owners will not, nor permit any of their respective officers, employees,
agents or representatives (including, without limitation, investment bankers,
attorneys and accountants) to, directly or indirectly, (a) solicit, initiate or
encourage submission of proposals or offers by, or (b) furnish any information
with respect to or otherwise cooperate in any way with, or participate in any
discussions or negotiations

with, any corporation, partnership, person or other entity or group ("Person")
with respect to any proposal regarding the acquisition or purchase of all or a
material portion of the assets of, or any equity interest in, DarkHorse, or any
business combination with DarkHorse. DarkHorse and/or the Owners shall promptly
notify Tanisys if any such proposal or offer, or any inquiry or contact with any
Person with respect thereto, is made and shall, in any such notice, indicate in
reasonable detail the identity of the offeror and the terms and conditions of
any such proposal.

Section 5.4 INVESTIGATION OF BUSINESS AND PROPERTIES. Each party hereto
may make or cause to be made such investigation of the business and properties
of the other parties and of their financial and legal condition as such party
deems appropriate or advisable to familiarize himself/itself therewith, provided
such investigation shall not unreasonably interfere with the normal operations
of the other parties. Tanisys and DarkHorse agree to permit the other party and
its accountants, counsel and other representatives to have reasonable access to
the premises, books and records of the first party. Tanisys and DarkHorse will
furnish the other party with such financial and operating data and other
information with respect to the business and properties of the other party as
the requesting party shall from time to time reasonably request in accordance
with this Section.

Section 5.5 CONFIDENTIALITY. Each party agrees with respect to all
technical, commercial and other information that is furnished or disclosed by
the other parties, including, but not limited to, information regarding such
party's (and its Subsidiaries' and Affiliates') organization, personnel,
business activities, customers, subscribers, policies, assets, finances, costs,
sales, revenues, technology, rights, obligations, liabilities and strategies
(the "Information"), that, unless and until the transactions contemplated hereby
shall have been consummated, (a) such Information is confidential and/or
proprietary to the furnishing/disclosing party and entitled to and shall receive
treatment as such by the receiving party; (b) the receiving party will hold in
confidence and not disclose or use (except in respect of the transactions
contemplated hereby) any such Information, treating such Information with the
same degree of care and confidentiality as it accords its own confidential and
proprietary information; provided, however, that the receiving party shall not
have any restrictive obligation with respect to any Information that (i) is
contained in a printed publication available to the general public, (ii) is or
becomes publicly known through no wrongful act or omission of the receiving
party, or (iii) is known by the receiving party without any proprietary
restrictions by the furnishing/disclosing party at the time of receipt of such
Information; and (c) all such Information furnished to a party by another,
unless otherwise specified in writing, shall remain the property of the
furnishing/disclosing party and, in the event this Agreement is terminated,
shall be returned to it, together with any and all copies made thereof, upon
written request for such return by it (except for documents submitted to a
governmental agency with the consent of the furnishing/disclosing party or upon
subpoena and that cannot be retrieved with reasonable effort), and each party
shall confirm in writing to the others compliance with any such request. Each
party hereto acknowledges that the remedy at law for any breach by a party of
its obligations under this section is inadequate and that the other parties
shall be entitled to equitable remedies, including injunctive relief, in the
event of breach by any other party.

Section 5.6 PUBLIC ANNOUNCEMENTS. Tanisys and DarkHorse shall consult
with each other before issuing any press release or otherwise making any public
statements with respect to the

Merger, this Agreement or transactions contemplated hereby, shall not issue
any such press release or make any such public statement prior to such
consultation, and shall consult with each other as to form and substance of
other public disclosures related thereto; provided however, that nothing
contained herein shall prohibit either party from making any disclosure that
is required by law.

Section 5.7 AGREEMENT TO CONSUMMATE. Subject to the terms and conditions
herein provided, each of the parties hereto agrees to use reasonable efforts to
do all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective, as soon as reasonably practicable,
the transactions contemplated by this Agreement, including, but not limited to,
the obtaining of all consents, authorizations, orders and approvals of any
governmental commission, board or other regulatory body required in connection
therewith and initiating or defending any legal action that is necessary or
appropriate to permit the transactions contemplated hereby to be consummated.
Without limiting the foregoing, the Owners shall not take any action to exercise
any statutory appraisal rights that they may have with respect to the Merger.
At any time after the Effective Date, if any further action is necessary, proper
or advisable to carry out the purposes of this Agreement, then, as soon as is
reasonably practicable, each party to this Agreement shall take, or cause its
proper officers to take, such action. No party to this Agreement shall take or
cause to be taken any action that would cause the representations or warranties
expressed herein to be untrue or incorrect on the Effective Date.

Section 5.8 DARKHORSE SHAREHOLDERS' APPROVAL. DarkHorse shall call a
meeting of its shareholders to be held as soon as practicable, but not later
than April 15, 1996, for the purpose of voting upon the Merger. In connection
with such meeting, DarkHorse shall mail all required notices and other materials
to its shareholders, and the Board of Directors of DarkHorse shall recommend
approval of the matters related to the Merger to be voted upon at such
shareholder meeting and shall use its best efforts to obtain such shareholder
approval. In lieu of such meeting, such approval may be effected by the
unanimous written consent of the shareholders of DarkHorse.

Section 5.9 TANISYS ACQUISITION II SHAREHOLDER'S APPROVAL. Tanisys
Acquisition II shall call a meeting of its shareholder to be held as soon as
practicable, but not later than May 20, 1996, for the purpose of voting upon the
Merger. In connection with such meeting, Tanisys Acquisition II shall mail all
required notices and other material to its shareholder, and the Board of
Directors of Tanisys Acquisition II shall recommend approval of the matters
related to the Merger to be voted on at such shareholder meeting and shall use
its best efforts to obtain such shareholder approval. In lieu of such meeting,
such approval may be affected by the unanimous written consent of the
shareholder of Tanisys Acquisition.

. Section 5.10 AGREEMENT REGARDING BROKERS. Each party agrees that it or he
will pay or dispute, and indemnify and hold the other parties harmless from, any
claims of brokers or others for finders' or brokerage fees asserted as a result
of representations by such party to such brokers or others, regardless of
whether the existence of such brokers or others are disclosed herein.

Section 5.11 NOTICE. DarkHorse shall promptly give notice to Tanisys and
the Owners upon becoming aware of the occurrence or failure to occur, or the
impending or threatened occurrence or failure to occur, of any event that would
cause or constitute, any of DarkHorse's

representations or warranties being or becoming untrue. Tanisys will
promptly give notice to DarkHorse and the Owners upon becoming aware of the
occurrence or failure to occur, of any event that would cause or constitute,
any of Tanisys' representations or warranties being or becoming untrue. The
Owners will promptly give notice to Tanisys and DarkHorse upon becoming aware
of the occurrence or failure to occur, or the impending or threatened
occurrence or failure to occur, of any event that would cause or constitute,
any of the Owners' representations or warranties being or becoming untrue.

Section 5.12 REPRESENTATION, WARRANTIES AND AGREEMENTS; SURVIVAL. The
representations, warranties and indemnities of DarkHorse, Tanisys and the
Owners, contained in this Agreement and any related documents, shall survive for
a period of six (6) months after the Effective Date. At the end of the survival
period of the representations and warranties of DarkHorse and the Owners,
Tanisys shall, without further action, be deemed to have fully released
DarkHorse and the Owners from any and all responsibility with respect to a
breach of such representations and warranties (including any obligation under
the indemnification provisions contained in Section 5.13) unless during such
survival period Tanisys shall have given DarkHorse and the Owners notice of the
nature and reasonable particulars under the then existing circumstances of any
claimed breach by DarkHorse and/or the Owners. At the end of the survival
period of representations and warranties of Tanisys, the Owners shall, without
further action, be deemed to have fully released Tanisys from any and all
responsibility with respect to a breach of such representations and warranties
unless during such survival period the Owners shall have given Tanisys notice of
the nature and reasonable particulars under the then existing circumstances of
any claimed breach by Tanisys and the basis therefor. The obligations,
covenants and agreements of DarkHorse, the Owners and Tanisys contained in this
Agreement and any related documents shall survive the Closing. The
representations, warranties, obligations, covenants, indemnities and agreements
shall not be affected by, and shall remain in full force and effect
notwithstanding, any investigation at any time made by or on behalf of any party
hereto or any information any party may have with respect thereto.

Section 5.13 INDEMNIFICATION BY DARKHORSE AND OWNERS AND SECURITY
AGREEMENT.

(a) DarkHorse and Owners shall severally indemnify and hold Tanisys
harmless from and against, and promptly reimburse Tanisys for any and
all loss, expense, damage, deficiency, liability or obligation,
including investigative and settlement costs and attorneys' fees
arising out of or in connection with any breach of representation or
warranty of DarkHorse or Owners contained in Article 2 or Article 4
hereof or in any certificate delivered pursuant hereto, regardless of
whether Tanisys relied upon the truth of such representation or
warranty or had any knowledge of any breach thereof. On the Effective
Date, fifteen percent (15%) of the Merger Consideration of Xxxx X.
Xxxxxxxxx, Xxxxxx Xxxxxxxx and Xxxx Xxxxxx will be escrowed (the
"Escrow") with U. S. Trust Company of Texas, N.A. (the "Escrow Agent")
to secure and satisfy Tanisys' right to indemnification hereunder.

(b) The Escrow shall be further defined in the Escrow Agreement attached
hereto as EXHIBIT "C" and shall remain in effect for a period of six
(6) months from the date of

closing of the Merger Agreement (such date, the "Escrow Termination
Date"). The Escrow may be maintained past the Escrow Termination Date
only in the event of litigation concerning the Escrow.

(c) Upon receipt by Tanisys (the "Indemnified Party") of notice of any
situation, event or occurrence that might give rise to a claim for
indemnification of such Indemnified Party against DarkHorse and/or the
Owners pursuant to this Section 5.13, the Indemnified Party shall give
prompt written notice thereof to DarkHorse and the Owners (each such
party, an "Indemnifying Party"), indicating the nature of such
indemnification. Failure to give any notice provided under this
Section 5.13(b) shall in no way be deemed a forfeiture of the
Indemnified Party's rights to be indemnified under Section 5.13
provided that such notice is given prior to the Escrow Termination
Date. A claim for indemnity may, at the option of the Indemnified
Party, be asserted as soon as any situation, event or occurrence has
been noticed by the Indemnified Party, regardless of whether actual
harm has been suffered or out-of-pocket expenses incurred.

(d) DarkHorse's and the Owners' indemnification will be limited to
situations, events and/or occurrences of which Tanisys provides notice
to the Owners prior to the Escrow Termination Date and to the amount
of, and only from shares comprising, the Escrow. Tanisys will not be
eligible to obtain any indemnification from the Escrow until the
aggregate amount of all losses, expenses, damages, deficiencies,
liabilities and other obligations arising out of or in connection with
any breach of representation or warranty of DarkHorse or the Owners
exceeds $10,000 in the aggregate and then only for the amount of such
excess. Shares released from the Escrow after such time will be
returned to the Owners in accordance with the terms of the Escrow
Agreement.

Section 5.14 INDEMNIFICATION BY TANISYS.

(a) Tanisys shall indemnify and hold Owner harmless from and against, and
promptly reimburse Owner for, any and all loss, expense, damage,
deficiency, liability or obligation, including investigative and
settlement costs and attorneys' fees, arising out of or in connection
with any breach of representation or warranty of Tanisys contained in
Article 3 hereof, or in any certificate delivered pursuant hereto,
regardless of whether Owner relied upon the truth of such
representation or warranty or had any knowledge of any breach thereof.

(b) Upon receipt by Owner (the "Indemnified Party") of notice of any
situation, event or occurrence that might give rise to a claim for
indemnification of such Indemnified Party against Tanisys pursuant to
this Section, the Indemnified Party shall give prompt written notice
thereof to Tanisys indicating the nature of such indemnification. A
claim for indemnity may, at the option of the Indemnified Party, be
asserted as soon as any situation, event or occurrence has been
noticed by the

Indemnified Party regardless of whether actual harm has been suffered
or out-of-pocket expenses incurred.

Section 5.15 RESALE LIMITATIONS. DarkHorse and the Owners agree to
certain resale restrictions and further agree to advise its Affiliates and
future Owners of the resale restrictions imposed by the VSE and federal
securities laws on shares of Tanisys Common Stock received by them pursuant to
the Merger, and will cause each Affiliate to sign the Restricted Stock
Investment Letter stating that such Affiliate and future Owners are aware of
such restrictions and as set forth in Section 6.3(h) herein.

ARTICLE 6
CONDITIONS PRECEDENT TO CLOSING

Section 6.1 GENERAL CONDITIONS. Consummation of the Merger shall be
subject to the fulfillment at the Effective Date of each of the following
conditions:

(a) NO INJUNCTION. No court having jurisdiction shall have issued, to the
knowledge of Tanisys, DarkHorse or the Owners, an injunction
preventing the consummation of the Merger that shall not have been
stayed or dissolved at the Effective Date.

(b) SECURITIES LAW. Tanisys shall have received all VSE, state securities
law authorizations or obtained applicable exemptions necessary to
consummate the transactions contemplated hereby, provided Tanisys
shall use reasonable efforts to obtain the same.

(c) VANCOUVER STOCK EXCHANGE. Tanisys shall have received notification
that the VSE has approved the issuance of and the listing of the
shares of Tanisys Common Stock.
.
(d) PROCEEDINGS. All proceedings taken or to be taken in connection with
the transactions contemplated hereby, and all documents incident
thereto shall be reasonably satisfactory in form and substance to the
parties and their counsel, and the parties and their counsel shall
have received all such counterpart originals or certified or other
copies of such documents as the parties or their counsel may
reasonably request.

(e) SIMULTANEOUS CLOSING. The issuance of the Merger Consideration is
subject to the simultaneous closing of the certain Agreement and Plan
of Merger dated April 9, 1996, by and between Tanisys, Tanisys
Acquisition and 1st Tech Corporation and Xxxx X. Xxxxxxxxx.

(f) APPRAISAL OF ASSETS OF DARKHORSE. The appraisal of BDO Dunwoody
Charter Accountants and Consultants upon the assets of DarkHorse shall
have been accepted and approved by Tanisys and the VSE prior to the
Closing.

(g) DARKHORSE'S ISSUANCE OF COMPENSATION SHARES. Prior to the Closing,
DarkHorse contemplates issuing no more than 45,000 shares of DarkHorse
Common Stock to certain key employees of DarkHorse ("Key Shares").
DarkHorse shall cause the number of Key Shares to be issued which will
comply with the Exchange Ratio of Section 1.2 herein. Upon issuance,
such Key Shares shall have been deemed fully paid and nonassessable
shares. Further, the recipients of such Key Shares shall execute any
and all documents deemed necessary by counsel for Tanisys at the
Closing, including but not limited to those representations and
warranties set forth in Section 4 and restrictions set forth in
Section 5.15.

(h) DUE DILIGENCE. It is expressly understood and agreed that the
obligations of Tanisys hereunder are expressly subject to and
conditioned upon Tanisys having a period of twenty-one (21) days from
the date this Agreement is fully executed ("Due Diligence Period") to
conduct such Due Diligence examination of DarkHorse's Financial
Statements, facilities, books, records and other matters considered
pertinent by Tanisys, at such time which is acceptable to both
parties, and DarkHorse further agrees to provide such other data or
information reasonably requested by Tanisys. Should such Due
Diligence deem to be unfavorable in Tanisys' sole discretion, Tanisys
may on or before the conclusion of the Due Diligence Period cancel the
Agreement by written notice to DarkHorse.

(i) APPROVAL OF TANISYS' SHAREHOLDERS. The transactions contemplated by
this Agreement are subject to the approval of a majority of the
outstanding shares of the Common Stock of Tanisys Technology, Inc.

Section 6.2 CONDITIONS TO CLOSING IN FAVOR OF DARKHORSE. Consummation of
the Merger shall be subject to the fulfillment, to the satisfaction of
DarkHorse, or written waiver, at or before the Effective Date, of each of the
following conditions:

(a) COPIES OF RESOLUTIONS OF TANISYS AND TANISYS ACQUISITION. Tanisys
shall have furnished DarkHorse with copies of resolutions duly adopted
by the Board of Directors and shareholders of Tanisys and the Board of
Directors and shareholder of Tanisys Acquisition II approving the
execution and delivery of this Agreement and consummation of the
transactions contemplated hereby, certified as of the Closing Date by
the Secretary or an Assistant Secretary of Tanisys and the Secretary
or Assistant Secretary of Tanisys Acquisition.

(b) OPINION OF COUNSEL FOR TANISYS. Tanisys shall have furnished
DarkHorse with an opinion dated the Closing Date from J. Xxxxxxx
Xxxxxx and W. Xxxxx Xxxx, counsel for Tanisys, in the form attached
hereto as EXHIBIT "D."

(c) REPRESENTATIONS AND WARRANTIES OF TANISYS. The representations,
warranties and statements of Tanisys contained in this Agreement, the
Exhibits hereto and Tanisys' Disclosure Schedule, shall be complete
and accurate as of the date of this

Agreement and shall also be complete and accurate at and as of the
Closing Date, except for changes contemplated by this Agreement, as if
made on the Closing Date; and Tanisys shall have performed or complied
with all agreements and covenants required by this Agreement to be
performed or complied with by it at or prior to the Closing Date.

(d) TANISYS OFFICERS' CERTIFICATE. Tanisys shall have delivered to
DarkHorse a certificate, dated the Closing Date, of the President and
Secretary of Tanisys to the effect that (i) they are familiar with the
provisions of this Agreement, and (ii) the conditions specified in
Section 6.1 and in paragraph (c) of this Section 6.2 have been
satisfied in all material respects.

(e) GOVERNMENTAL CONSENTS, AUTHORIZATIONS, ETC. All material consents,
authorizations, orders or approvals of, and filings or registrations
with, and any permits, licenses or other authorizations required by,
any applicable Governmental Body that are required for, or in
connection with, the execution and delivery of this Agreement by
DarkHorse and the consummation by DarkHorse of the transactions
contemplated hereby shall have been obtained or made.

(f) LEGISLATION. No law or legally binding regulation shall have been
enacted that does or would prohibit, restrict or delay consummation of
the Merger or any of the conditions to the consummation of the Merger
or that does or would have a Material Adverse Effect on Tanisys or any
of its Subsidiaries.

(g) DARKHORSE SHAREHOLDER APPROVAL. The holders of at least a majority of
the shares of outstanding DarkHorse Common Stock shall have voted in
favor of the Merger.

(h) CONSENTS. On or before the Effective Date, Tanisys shall have
obtained all necessary or required consents to the transactions
contemplated by this Agreement. In addition, on or before the Closing
Date, DarkHorse shall have obtained all necessary or required consents
to the transactions contemplated by this Agreement, including, without
limitation, the consents required by DarkHorse's lenders, on terms and
conditions reasonably satisfactory to DarkHorse.

(i) RELEASE OF PERSONAL GUARANTIES. On or before the Effective Date,
Tanisys shall have caused the Owners to be released from any and all
personal guaranties concerning DarkHorse.

Section 6.3 CONDITIONS TO CLOSING IN FAVOR OF TANISYS. Consummation of
the Merger shall be subject to the fulfillment, to the satisfaction of Tanisys,
or written waiver, at or before the Effective Date of the following conditions:

(a) COPIES OF RESOLUTIONS OF DARKHORSE. DarkHorse shall have furnished
Tanisys with copies of resolutions duly adopted by the Board of
Directors and shareholders of DarkHorse approving the execution and
delivery of this Agreement, and the

consummation of the transactions contemplated hereby, certified as of
the Closing Date by the Secretary or an Assistant Secretary of
DarkHorse.

(b) OPINION OF COUNSEL FOR DARKHORSE. DarkHorse shall have furnished
Tanisys with an opinion dated the Closing Date from Xxxxx, Xxxxx &
Werkenthin, P.C., counsel for DarkHorse, in the form attached hereto
as EXHIBIT "F."

(c) REPRESENTATIONS AND WARRANTIES OF DARKHORSE AND THE OWNERS. The
representations, warranties and statements of DarkHorse and the Owners
contained in this Agreement, the Exhibits hereto, DarkHorse's
Disclosure Schedule and the Owners' Disclosure Schedule shall be
complete and accurate as of the date of this Agreement and shall also
be complete and accurate at and as of the Closing Date, except for
changes contemplated by this Agreement, as if made at and as of the
Closing Date; and DarkHorse and the Owners shall have performed or
complied with all agreements and covenants required by this Agreement
to be performed or complied with by it at or prior to the Closing
Date.

(d) DARKHORSE OFFICERS' AND THE OWNERS' CERTIFICATES. DarkHorse shall
have delivered to Tanisys a certificate, dated the Closing Date, of
the President and Secretary of DarkHorse to the effect that (i) they
are familiar with the provisions of this Agreement, and (ii) the
conditions specified in Section 6.1 and in paragraph (c) of this
Section 6.3 have been fully satisfied. The Owners shall have
delivered to Tanisys a Certificate, dated the Closing Date, to the
effect that (i) they are familiar with the provisions of the
Agreement, and (ii) the conditions specified in Section 6.1 and in
Paragraph (c) of this Section 6.3 have been fully satisfied.

(e) GOVERNMENTAL CONSENTS, AUTHORIZATIONS, ETC. All material consents,
authorizations, orders or approvals of, and filings or registrations
with, and any permits, licenses or other authorizations required by,
any applicable Governmental Body that are required for or in
connection with, the execution and delivery of this Agreement by
Tanisys and the consummation by Tanisys of the transactions
contemplated hereby shall have been obtained or made.

(g) CONSENTS. On or before the Effective Date, DarkHorse shall have
obtained all necessary or required consents to the transactions
contemplated by this Agreement, including, without limitation, the
consents required by DarkHorse's lenders, on terms and conditions
reasonably satisfactory to Tanisys. In addition, on or before the
Closing Date, Tanisys shall have obtained all necessary or required
consents to the transactions contemplated by this Agreement,
including, without limitation, the

consents required by Tanisys' lenders, on terms and conditions
reasonably satisfactory to Tanisys.

(h) RESTRICTED STOCK INVESTMENT LETTERS. Xxxx X. Xxxxxxxxx, Xxxxxx
Xxxxxxxx, Xxxx Xxxxxx and future Owner(s) as determined in accordance
with Section 6.1(g) shall have entered into Restricted Stock
Investment Letters with Tanisys in the form attached hereto as
EXHIBIT "G."

ARTICLE 7
TERMINATION, AMENDMENT AND WAIVER

Section 7.1 TERMINATION. This Agreement may be terminated at any time
prior to the Effective Date, whether or not shareholder approval has been
received:

(a) By mutual consent of the Boards of Directors of Tanisys and DarkHorse;

(b) By DarkHorse if any representation or warranty of Tanisys or by
Tanisys if any representation or warranty of DarkHorse or the Owners
contained herein shall have been incorrect or breached in any material
respect, as to which notice shall have been given to such party, and
shall not have been cured or otherwise resolved to the reasonable
satisfaction of the other party on or before the Effective Date;

(c) By either Tanisys or DarkHorse if any permanent injunction or other
order of a court or other competent authority preventing the
consummation of the Merger shall have become final and non-appealable;

(d) By Tanisys or DarkHorse if the Merger has not become effective by July
15, 1996; provided, however, that no party shall be permitted to
terminate hereunder if such party is in violation of this Agreement;
or

(e) By either Tanisys or DarkHorse if the last trade of Tanisys' Common
Stock on the VSE is less than Two Dollars ($2.00) for five (5)
consecutive business days.

Section 7.2 EFFECT OF TERMINATION. In the event of the termination of
this Agreement as provided herein, this Agreement shall become wholly void and
have no further force and effect except as hereinafter provided; and there shall
be no liability on the part of Tanisys or DarkHorse (or their respective
officers of directors) except to comply with the confidentiality provisions of
Section 5.5 hereof, and except as otherwise provided herein. Nothing contained
herein shall relieve any party from liability for its breach of this Agreement.

Section 7.3 AMENDMENT. This Agreement and the Exhibits and Schedules
hereto may be amended by the parties hereto at any time prior to the Effective
Date; provided, however, that any amendment must be by an instrument or
instruments in writing signed and delivered on behalf of each of the parties
hereto.

Section 7.4 EXTENSION; WAIVER. At any time prior to the Effective Date,
any corporate party hereto that is entitled to the benefits hereof, by action
taken by its Board of Directors or a duly authorized officer, may (a) extend the
time for the performance of any of the obligations or other acts of any of the
other parties hereto; (b) in whole or in part, waive any inaccuracy in the
representations and warranties of any of the other parties hereto contained
herein or in any Exhibit or Schedule hereto or in any document delivered
pursuant hereto; and (c) in whole or in part, waive compliance with any of the
agreements of any of the other parties hereto or conditions contained herein.
Any agreement on the part of any party hereto to any such extension or waiver
shall be valid as set forth in an instrument in writing signed and delivered on
behalf of such party.

ARTICLE 8
GENERAL PROVISIONS

Section 8.1 EXCLUSIVE REMEDY. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of Sections
5.13 and 5.14 of this Agreement or any related instruments, including any claim
based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the rules of practice and procedure for the
arbitration of commercial disputes of Chapter 171 of the Texas Civil Practice
and Remedies Code (the "Texas Arbitration Act") and the rules set forth herein.
Such remedy shall be the exclusive remedy for any such controversy or claim.
Judgment upon any arbitration award may be entered in any court having
jurisdiction. Any party to this Agreement may bring an action, including a
summary or expedited proceeding to compel arbitration of any controversy or
claim to which this Agreement applies in any court having jurisdiction over such
action. The arbitration shall be conducted in the City of Austin, Texas, and
administered in accordance with the Texas Arbitration Act. The parties shall
attempt to agree on one person to serve as the arbitrator for any controversy or
claim hereunder. In the event the parties are unable to agree on a single
arbitrator, each of the parties to this Agreement shall appoint one person as a
arbitrator to hear and determine the dispute and the two arbitrators so chosen
shall select a third impartial arbitrator whose decision shall be final and
conclusive as to all matters subject to arbitration hereunder. If for any
reason a third arbitrator cannot be named under the previous provisions, any
state district judge sitting in Xxxxxx County, Texas, upon application by one of
the parties hereto, shall have the power to appoint one or more arbitrators to
resolve disputes hereunder. All arbitration hearings will be commenced within
ninety (90) days of the demand for arbitration; further, the arbitrator shall
only, upon a showing of cause, be permitted to extend the commencement of such
hearing for an additional sixty (60) days.

Section 8.2 NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed given if and when delivered personally or
transmitted by telex, telecopy or telegram, mailed by registered or certified
mail (return receipt requested) or sent by a recognized next business day
courier to the persons at the following addresses (or at such other address for
a party as shall be specified by like notice):

If to Tanisys:

Xxxx X. Holiday
Chairman and Chief Executive Officer
Tanisys Technology, Inc.
0000 XX 000 Xxxxx, Xxxxx X000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

with a copy to:

W. Xxxxx Xxxx
Attorney at Law
0000 Xxx Xxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

If to DarkHorse:
DarkHorse Systems, Inc.
00000 Xxxxxxxxxx Xxxx., Xxxxx 000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile : (000) 000-0000

with a copy to:

Xxxxxxx X. Xxxxx
Xxxxx, Xxxxx & Xxxxxxxxxx, P.C.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

If to the Owners:
Xxxx X. Xxxxxxxxx
Chairman and Chief Executive Officer
DarkHorse Systems, Inc.
00000 Xxxxxxxxxx Xxxx., Xxxxx 000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile : (000) 000-0000

Xxxxxx Xxxxxxxx
DarkHorse Systems, Inc.
00000 Xxxxxxxxxx Xxxx., Xxxxx 000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

Xxxx Xxxxxx
DarkHorse Systems, Inc.
00000 Xxxxxxxxxx Xxxx., Xxxxx 000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile : (000) 000-0000

with a copy to:

Xxxxxxx X. Xxxxx
Xxxxx, Xxxxx & Xxxxxxxxxx, P.C.
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000

Section 8.3 FEES AND EXPENSES. Tanisys and DarkHorse shall each bear its
own expenses in negotiating, executing and delivering this Agreement and any
related documents and in preparing for the Closing (as defined below).

Section 8.4 INTERPRETATION. The headings contained in this Agreement are
for reference purposes only and shall not affect the meaning or interpretation
of this Agreement. Terms such as "herein," "hereof" and "hereinafter" refer to
this Agreement as a whole and not to the particular sentence or paragraph where
they appear, unless the context otherwise requires. Terms used in the plural
include the singular, and vice versa, unless the context otherwise requires.

Section 8.5 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

Section 8.6 MISCELLANEOUS. This Agreement, including the Exhibits and
Schedules hereto, (a) constitutes the entire agreement and supersedes all other
prior agreements and understandings, both written and oral, among the parties,
or any of them, with respect to the subject matter hereof; (b) is not intended
to and shall not confer upon any other person any rights or remedies hereunder
or otherwise with respect to the subject matter hereof, except for rights that
may expressly arise as a consequence of the Merger; (c) shall not be assigned by
operation of law or otherwise; (d) has been drafted by all of the parties to
this Agreement and should not be construed against any of the parties hereto;
and (e) shall be governed in all respects, including validity, interpretation
and effect by the substantive laws of the State of Texas without regard to
conflict of law provisions.

Section 8.7 SURVIVAL. No investigation by the parties hereto made
heretofore or hereafter shall affect the representations and warranties of the
parties that are contained herein, and each such representation and warranty
shall survive such investigation for a period of six (6) months from the
Closing.

Section 8.8 GOVERNING LAW. This Agreement and the rights and obligations
of the parties hereto has a reasonable relation to and shall be governed,
construed and enforced in accordance with the laws of the State of Texas. The
parties agree that any litigation relating directly or indirectly to this
Agreement must be brought before and determined by a court of competent
jurisdiction within Xxxxxx County, Texas.

Section 8.9 CLOSING. The closing of the transactions contemplated by this
Agreement (the "Closing") shall take place at such time and place as Tanisys and
DarkHorse shall mutually agree (the "Closing Date"). Unless otherwise agreed by
Tanisys and DarkHorse, the Closing shall occur on the Effective Date.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement or have
caused this Agreement to be executed by their duly authorized officers.

TANISYS TECHNOLOGY, INC.

By: XXXX X. XXXXXXXX
----------------------------
Chairman of the Board and
Chief Executive Officer

TANISYS ACQUISITION CORP. II

By: /s/ XXXX X. XXXXXXXX
----------------------------
Chairman of the Board and
Chief Executive Officer

DARKHORSE SYSTEMS, INC.

By: /s/ XXXX X. XXXXXXXXX
----------------------------
Chairman of the Board and
Chief Executive Officer

/s/ XXXX X. XXXXXXXXX
----------------------------
XXXX X. XXXXXXXXX, Individually

/s/ XXXXXX XXXXXXXX
----------------------------
XXXXXX XXXXXXXX, Individually

/s/ XXXX XXXXXX
----------------------------
XXXX XXXXXX, Individually

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EXHIBIT 10.7 AGREEMENT AND PLAN OF MERGER BY AND BETWEEN

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