--------------------------------------------------------------------------------










                SECURED CONVERTIBLE DEBENTURE PURCHASE AGREEMENT

                                      Among

                       ACCORD ADVANCED TECHNOLOGIES, INC.

                                       and

                         THE INVESTORS SIGNATORY HERETO




                            Dated as of June __, 2000







--------------------------------------------------------------------------------
<PAGE>
     SECURED CONVERTIBLE DEBENTURE PURCHASE AGREEMENT (this "AGREEMENT"),  dated
as of  June  22,  2000,  among  ACCORD  ADVANCED  TECHNOLOGIES,  INC.  a  Nevada
corporation  (the  "COMPANY"),  and the  investors  signatory  hereto (each such
investor  is a  "PURCHASER"  and  all  such  investors  are,  collectively,  the
"PURCHASERS").

     WHEREAS,  subject to the terms and conditions set forth in this  Agreement,
the  Company  desires to issue and sell to the  Purchasers  and the  Purchasers,
severally  and not  jointly,  desire to purchase  from the Company an  aggregate
principal  amount  of  $1,000,000  of  the  Company's  12%  Secured  Convertible
Debentures,  due June 30,  2001,  which  shall be in the form of  EXHIBIT A (the
"DEBENTURES"),  and which are  convertible  into shares of the Company's  common
stock,  $ .0001 par value per share (the "Common  Stock").  All  references to $
(dollars) shall be to US$ (United States Dollars).

     NOW, THEREFORE,  IN CONSIDERATION of the mutual covenants contained in this
Agreement,  and for  other  good and  valuable  consideration  the  receipt  and
adequacy  are hereby  acknowledged,  the  Company  and the  Purchasers  agree as
follows:

                                    ARTICLE I
                                PURCHASE AND SALE

     1.1 THE CLOSING.

         (a) THE CLOSING.  (i) Subject to the terms and  conditions set forth in
this  Agreement,  the  Company  shall issue and sell to the  Purchasers  and the
Purchasers  shall,  severally  and not  jointly,  purchase  from the Company the
Debentures for an aggregate  purchase  price of  $1,000,000.  The closing of the
purchase  and sale of the  Debentures  (the  "CLOSING")  shall take place at the
offices  of  Robinson   Silverman   Pearce  Aronsohn  &  Berman  LLP  ("ROBINSON
SILVERMAN"),  1290 Avenue of the Americas, New York, New York 10104, immediately
following  the  execution  hereof or such later date as the parties shall agree.
The date of the Closing is  hereinafter  referred to as the "CLOSING  DATE." The
purchase and sale of the Debentures  shall occur in two separate  tranches.  The
first tranche  ("FIRST  TRANCHE") shall be completed on the Closing Date and the
Purchasers  shall pay an aggregate  purchase price of $500,000 on such date (the
"INITIAL  PURCHASE  PRICE").  The second  tranche  ("SECOND  TRANCHE")  shall be
completed  within  thirty days after the  Effective  Date (as defined in Section
3.1(b))  ("SECOND  TRANCHE  CLOSING  DATE")  and  the  Purchasers  shall  pay an
aggregate purchase price of $500,000 (the "SUBSEQUENT PURCHASE PRICE").

              (ii) On the Closing Date, the parties shall deliver or shall cause
to be delivered the  following:  (A) the Company shall deliver to each Purchaser
(1) Debentures representing a portion of the Initial Purchase Price paid by such
Purchaser on the Closing Date, as indicated below such  Purchaser's  name on the
signature page to this Agreement,  registered in the name of such Purchaser, (2)
a Common Stock  purchase  warrant,  in the form of EXHIBIT D,  registered in the
name of such Purchaser, pursuant to which such Purchaser shall have the right to
acquire 500,000 shares of Common Stock as indicated below such  Purchaser's name
on the signature page to this Agreement (collectively,  the "WARRANTS"), (3) the
legal opinion of Robson,  Ferber,  Frost, Chan & Essner,  LLP outside counsel to
the  Company,  in the form of EXHIBIT  C, (4) an  executed  Registration  Rights
<PAGE>
Agreement,  dated the date hereof, among the Company and the Purchasers,  in the
form of EXHIBIT B (the "REGISTRATION RIGHTS AGREEMENT"),  and the Transfer Agent
Instructions,  in the form of EXHIBIT E,  delivered to and  acknowledged  by the
Company's transfer agent (the "TRANSFER AGENT INSTRUCTIONS") and (5) an executed
Security  Agreement,  dated  the  date  hereof,  between  the  Company  and  the
Purchasers,  in the Form of Exhibit F (the "SECURITY  AGREEMENT");  and (B) each
Purchaser  shall deliver (1) its portion of the Initial  Purchase Price purchase
indicated below such Purchaser's name on the signature page to this Agreement in
United  States  dollars in  immediately  available  funds by wire transfer to an
account  designated  in  writing by the  Company  for such  purpose,  and (2) an
executed Registration Rights Agreement and Security Agreement.

              (iii) Within thirty days  following the  Effective  Date,  (A) the
Company  will,  against  delivery of the amounts set forth in clause (B) in this
paragraph, deliver to each Purchaser, Debentures representing the portion of the
Subsequent  Payment Price indicated below such Purchaser's name on the signature
page of this  Agreement  (subject  to  equitable  adjustment  for stock  splits,
recombinations  and similar  events),  registered in the name of such Purchaser,
(B) each  Purchaser  will deliver to the Company,  its portion of the Subsequent
Payment Price as indicated below such  Purchaser's name on the signature page to
this Agreement in United States dollars in immediately  available  funds by wire
transfer to an account designated in writing by the Company for such purpose and
(C) the Company will deliver to each Purchaser, Warrants, registered in the name
of such  Purchaser,  pursuant  to which such  Purchaser  shall have the right to
acquire the number of shares of Common Stock  indicated  below such  Purchaser's
name on the signature page to this Agreement.

     Notwithstanding  anything to the contrary contained in this Agreement,  the
commitment  of a  Purchaser  to  acquire  the  securities  described  in Section
1.1(a)(iii)  above is subject to the satisfaction or waiver by the Purchasers of
each of the following conditions:

         (a) CLOSING OF FIRST  TRANCHE.  The Closing of the purchase and sale of
the First Tranche shall have occurred;

         (b)  ACCURACY OF THE  COMPANY'S  REPRESENTATIONS  AND  WARRANTIES.  The
representations  and  warranties  of  the  Company  contained  in  the  Purchase
Agreement  shall be true and  correct  as of the  date  when  made and as of the
Second  Tranche  Closing  Date as though  made on and as of the  Second  Tranche
Closing  Date (other  than  representations  and  warranties  which  relate to a
specific date (which shall not include  representations  and warranties relating
to the "date hereof") which  representations  and warranties shall be true as of
such specific date);

         (c)  PERFORMANCE  BY THE  COMPANY.  The Company  shall have  performed,
satisfied and complied with all covenants, agreements and conditions required by
the  Transaction  Documents to be  performed,  satisfied or complied with by the
Company  between the Closing  Date and the Second  Tranche  Closing  Date and no
Event (as defined in the  Registration  Rights  Agreement ) shall have  occurred
which has not been cured to the satisfaction of the Purchasers;

         (d) UNDERLYING  SHARES  REGISTRATION  STATEMENT.  The Underlying Shares
Registration  Statement shall have been declared  effective under the Securities
Act by the  Commission  and shall have  remained  effective  at all  times,  not
subject  to any  actual or  threatened  stop  order or  subject to any actual or
threatened suspension at any time prior to the Second Tranche Closing Date.

                                      -2-
<PAGE>
         (e)  NO  INJUNCTION.   Since  the  Closing  Date,  no  statute,   rule,
regulation,  executive  order,  decree,  ruling or  injunction  shall  have been
enacted,  entered,  promulgated,  amended,  modified or endorsed by any court of
governmental  authority of competent  jurisdiction  or  governmental  authority,
stock market or trading  facility which prohibits the consummation of any of the
transactions  contemplated by the Transaction  Documents or makes  impracticable
the transactions contemplated thereby;

         (f)  ADVERSE  CHANGES.  Since the Closing  Date,  no event or series of
events  which  reasonably  would be  expected  to have or result  in a  Material
Adverse Effect shall have occurred;

         (g) NO  SUSPENSIONS  OF TRADING  IN COMMON  STOCK.  The  trading in the
Common  Stock  shall not have been  suspended  by the  Commission  or on the OTC
(except  for any  suspension  of trading of  limited  duration  solely to permit
dissemination of material  information  regarding the Company) at any time since
the Closing Date;

         (h) LISTING OF COMMON  STOCK.  The Common  Stock shall have been at all
times since the Closing Date quoted on the OTC;

         (i)  PURCHASERS'   BENEFICIAL  OWNERSHIP.   The  Purchasers  shall  not
beneficially own in excess of 9.999% of the outstanding shares of Common Stock;

         (j) PERFORMANCE OF CONVERSION/EXERCISE  OBLIGATIONS.  The Company shall
have timely  complied  with its  conversion,  exercise and delivery  obligations
under the First Tranche.

     1.2 CERTAIN  DEFINED  TERMS.  For purposes of this  Agreement,  "CONVERSION
PRICE,"  "ORIGINAL  ISSUE DATE" and  "TRADING  DAY" shall have the  meanings set
forth in the  Debentures;  "BUSINESS  DAY" shall  mean any day except  Saturday,
Sunday and any day which shall be a federal  legal  holiday in the United States
or a day on which banking  institutions  in the State of New York or Arizona are
authorized or required by law or other  governmental  action to close;  "PERSON"
means  an  individual  or  corporation,   partnership,  trust,  incorporated  or
unincorporated  association,  joint venture,  limited liability  company,  joint
stock company,  government (or an agency or subdivision thereof) or other entity
of any kind.

                                   ARTICLE II
                         REPRESENTATIONS AND WARRANTIES

     2.1 REPRESENTATIONS,  WARRANTIES AND AGREEMENTS OF THE COMPANY. The Company
hereby makes the following representations and warranties to the Purchasers:

         (a) ORGANIZATION AND  QUALIFICATION.  The Company is a corporation duly
incorporated,  validly existing and in good standing under the laws of the State
of Nevada with the  requisite  corporate  power and authority to own and use its
properties and assets and to carry on its business as currently  conducted.  The

                                      -3-
<PAGE>
Company  has  no  subsidiaries  other  than  as set  forth  in  SCHEDULE  2.1(A)
(collectively the  "SUBSIDIARIES").  Each of the Subsidiaries is an entity, duly
incorporated or otherwise organized, validly existing and in good standing under
the  laws  of  the  jurisdiction  of  its   incorporation  or  organization  (as
applicable),  with  the  requisite  power  and  authority  to own  and  use  its
properties and assets and to carry on its business as currently conducted.  Each
of the Company and the  Subsidiaries  is duly qualified to do business and is in
good standing as a foreign  corporation in each jurisdiction in which the nature
of the  business  conducted  or  property  owned by it makes such  qualification
necessary,  except where the failure to be so qualified or in good standing,  as
the case may be, could not,  individually  or in the  aggregate,  (x)  adversely
affect the legality,  validity or  enforceability  of the Securities (as defined
below) or any of this Agreement, the Registration Rights Agreement, the Security
Agreement,  the Transfer Agent Instructions or the Warrants  (collectively,  the
"TRANSACTION DOCUMENTS"), (y) have or result in a material adverse effect on the
results of operations,  assets, prospects, or condition (financial or otherwise)
of the Company and the  Subsidiaries,  taken as a whole, or (z) adversely impair
the Company's  ability to perform fully on a timely basis its obligations  under
any of the  Transaction  Documents (any of (x), (y) or (z), a "MATERIAL  ADVERSE
EFFECT").

         (b) AUTHORIZATION; ENFORCEMENT. The Company has the requisite corporate
power  and  authority  to  enter  into  and  to  consummate   the   transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations  thereunder.  The execution and delivery of each of the  Transaction
Documents  by  the  Company  and  the  consummation  by it of  the  transactions
contemplated  thereby have been duly  authorized by all necessary  action on the
part of the Company and no further  action is required by the  Company.  Each of
the  Transaction  Documents  and the  Debentures  has been duly  executed by the
Company and, when  delivered (or filed,  as the case may be) in accordance  with
the terms  hereof,  will  constitute  the valid and  binding  obligation  of the
Company  enforceable  against the Company in accordance with its terms.  Neither
the Company nor any  Subsidiary is in violation of any of the  provisions of its
respective   certificate  or  articles  of   incorporation,   by-laws  or  other
organizational or charter documents.

         (c)  CAPITALIZATION.  The number of authorized,  issued and outstanding
capital  stock of the  Company  is set forth in  SCHEDULE  2.1(C).  No shares of
Common Stock are entitled to preemptive or similar rights,  nor is any holder of
the Common Stock  entitled to  preemptive or similar  rights  arising out of any
agreement or understanding  with the Company by virtue of any of the Transaction
Documents. Except as a result of the purchase and sale of the Debentures and the
Warrants and except as disclosed in SCHEDULE  2.1(C),  there are no  outstanding
options,  warrants,  script rights to subscribe to, calls or  commitments of any
character   whatsoever  relating  to,  or  securities,   rights  or  obligations
convertible  into or  exchangeable  for, or giving any Person (as defined below)
any right to subscribe for or acquire, any shares of Common Stock, or contracts,
commitments,  understandings,  or  arrangements  by  which  the  Company  or any
Subsidiary is or may become bound to issue additional shares of Common Stock, or
securities or rights convertible or exchangeable into shares of Common Stock.

         (d) ISSUANCE OF THE DEBENTURES AND THE WARRANTS. The Debentures and the
Warrants are duly  authorized  and, when issued and paid for in accordance  with
the terms hereof, will be duly and validly issued, fully paid and nonassessable,
free and clear of all liens,  encumbrances  and  rights of first  refusal of any
kind  (collectively,  "LIENS").  The Company has on the date hereof and will, at

                                      -4-
<PAGE>
all times while the  Debentures  and the Warrants are  outstanding,  maintain an
adequate  reserve  of duly  authorized  shares of  Common  Stock,  reserved  for
issuance  to the holders of the  Debentures  and the  Warrants,  to enable it to
perform its conversion, exercise and other obligations under this Agreement, the
Debentures  and the Warrants.  Such number of reserved and  available  shares of
Common  Stock is not less  than the sum of (i) 200% of the  number  of shares of
Common Stock which would be issuable upon  conversion in full of the Debentures,
assuming such  conversion  occurred on the Original  Issue Date,  the Debentures
remain  outstanding  for two years and all  interest is paid in shares of Common
Stock and (ii) the number of shares of Common Stock  issuable  upon  exercise of
the Warrants (such number of shares of Common Stock as  contemplated  in clauses
(i)-(ii),  the "INITIAL  MINIMUM").  All such authorized  shares of Common Stock
shall be duly  reserved  for issuance to the holders of the  Debentures  and the
Warrants.  The shares of Common Stock issuable upon conversion of the Debentures
and upon  exercise of the  Warrants are  collectively  referred to herein as the
"UNDERLYING SHARES." The Debentures,  the Warrants and the Underlying Shares are
collectively  referred to herein as, the "SECURITIES." When issued in accordance
with  the  Debentures  and the  Warrants,  the  Underlying  Shares  will be duly
authorized, validly issued, fully paid and nonassessable,  free and clear of all
Liens.

         (e) NO  CONFLICTS.  The  execution,  delivery  and  performance  of the
Transaction  Documents by the Company and the consummation by the Company of the
transactions  contemplated  thereby  do not and  will not (i)  conflict  with or
violate any  provision  of the  Company's  or any  Subsidiary's  certificate  or
articles of  incorporation,  bylaws or other charter  documents (each as amended
through the date hereof),  or (ii) subject to obtaining  the Required  Approvals
(as defined  below),  conflict  with, or constitute a default (or an event which
with notice or lapse of time or both would become a default)  under,  or give to
others any rights of termination,  amendment, acceleration or cancellation (with
or without notice,  lapse of time or both) of, any agreement,  credit  facility,
debt or other instrument  (evidencing a Company or Subsidiary debt or otherwise)
or other  understanding  to which the Company or any Subsidiary is a party or by
which  any  property  or  asset of the  Company  or any  Subsidiary  is bound or
affected,  or (iii) result in a violation of any law, rule,  regulation,  order,
judgment,  injunction,  decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and
state securities laws and regulations), or by which any property or asset of the
Company is bound or  affected;  except in the case of each of  clauses  (ii) and
(iii),  as could  not,  individually  or in the  aggregate,  have or result in a
Material  Adverse Effect.  The business of the Company is not being conducted in
violation of any law,  ordinance or  regulation of any  governmental  authority,
except for violations which, individually or in the aggregate, could not have or
result in a Material Adverse Effect.

         (f)  FILINGS,  CONSENTS  AND  APPROVALS.  Neither  the  Company nor any
Subsidiary is required to obtain any consent, waiver, authorization or order of,
give any notice to, or make any filing or registration  with, any court or other
federal,  state,  local or other  governmental  authority  or  other  Person  in
connection  with the execution,  delivery and  performance by the Company of the
Transaction  Documents,  other than (i) the filings required pursuant to Section
3.10,  (ii)  the  filing  with  the  Securities  and  Exchange  Commission  (the
"Commission") of a registration  statement meeting the requirements set forth in
the  Registration  Rights  Agreement  and covering the resale of the  Underlying
Shares by the Purchasers (the "UNDERLYING SHARES REGISTRATION STATEMENT"), (iii)
applicable  Blue Sky  filings  and (iv) in all other  cases where the failure to
obtain such consent,  waiver,  authorization or order, or to give such notice or

                                      -5-
<PAGE>
make such filing or registration could not have or result in, individually or in
the  aggregate,   a  Material  Adverse  Effect   (collectively,   the  "REQUIRED
APPROVALS").

         (g) LITIGATION;  PROCEEDINGS. There is no action, suit, inquiry, notice
of violation,  proceeding or  investigation  pending or, to the knowledge of the
Company,  threatened against or affecting the Company or any of its Subsidiaries
or any of  their  respective  properties  before  or by any  court,  arbitrator,
governmental or administrative  agency or regulatory authority (federal,  state,
county,  local or  foreign)  (collectively,  an  "Action")  which (i)  adversely
affects or challenges  the legality,  validity or  enforceability  of any of the
Transaction  Documents or the Securities or (ii) could,  individually  or in the
aggregate,  have or result in a Material  Adverse  Effect.  Notwithstanding  the
foregoing to the  contrary,  the  Purchasers  have been apprised of and provided
copies of all complaints and answers filed through the date hereof in connection
with that certain  action filed in the United States  District  Court,  Southern
District of New York as Case No. 99 Civ.  10625 (LMM)  entitled GEM  MANAGEMENT,
LTD. AND SUCCESSWAY HOLDINGS LTD.,  PLAINTIFFS V. ACCORD ADVANCED  TECHNOLOGIES,
INC.

         (h) NO DEFAULT OR VIOLATION. Neither the Company nor any Subsidiary (i)
is in default under or in violation of (and no event has occurred  which has not
been  waived  which,  with  notice or lapse of time or both,  would  result in a
default by the  Company or any  Subsidiary  under),  nor has the  Company or any
Subsidiary  received notice of a claim that it is in default under or that it is
in violation of, any indenture,  loan or credit agreement or any other agreement
or instrument to which it is a party or by which it or any of its  properties is
bound,  (ii)  is  in  violation  of  any  order  of  any  court,  arbitrator  or
governmental  body, or (iii) is in violation of any statute,  rule or regulation
of any governmental authority, in each case of clauses (i), (ii) or (iii) above,
except  as could  not  individually  or in the  aggregate,  have or  result in a
Material  Adverse  Effect.  The  security  interests  granted to the  Purchasers
pursuant to the  Security  Agreement  will convey and grant to the  Purchasers a
first  priority  security  interest  in all of the  Collateral  (as such term is
defined in such agreements).

         (i) PRIVATE OFFERING.  Assuming the accuracy of the representations and
warranties  of the  Purchasers  set forth in  Sections  2.2(b)-(g),  the  offer,
issuance and sale of the Securities to the Purchasers as contemplated hereby are
exempt from the  registration  requirements  of the  Securities  Act of 1933, as
amended (the "SECURITIES ACT"). Neither the Company nor any Person acting on its
behalf has taken or is, to the  knowledge of the Company,  contemplating  taking
any action which could subject the offering,  issuance or sale of the Securities
to the registration  requirements of the Securities Act including soliciting any
offer to buy or sell the Securities by means of any form of general solicitation
or advertising.

         (j) SEC  DOCUMENTS;  FINANCIAL  STATEMENTS.  The  Company has filed all
reports  required to be filed by it under the Exchange  Act of 1934,  as amended
(the "Exchange Act"),  including pursuant to Section 13(a) or 15(d) thereof, for
the two years  preceding the date hereof (or such shorter  period as the Company
was  required  by law to file such  material)  (the  foregoing  materials  being
collectively  referred to herein as the "SEC Documents"  and,  together with the
Schedules to this Agreement,  the  "DISCLOSURE  MATERIALS") on a timely basis or
has received a valid extension of such time of filing and has filed any such SEC
Documents prior to the expiration of any such extension.  As of their respective
dates, the SEC Documents complied in all material respects with the requirements
of the Securities Act and the Exchange Act and the rules and  regulations of the

                                      -6-
<PAGE>
Commission promulgated  thereunder,  and none of the SEC Documents,  when filed,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated  therein or necessary in order to make the statements
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.  All material agreements to which the Company is a party or to which
the property or assets of the Company are subject have been filed as exhibits to
the SEC Documents as required.  The financial statements of the Company included
in the SEC Documents comply in all material respects with applicable  accounting
requirements  and the rules  and  regulations  of the  Commission  with  respect
thereto as in effect at the time of filing. Such financial  statements have been
prepared in accordance with generally accepted accounting  principles applied on
a  consistent  basis  during the  periods  involved  ("GAAP"),  except as may be
otherwise  specified in such  financial  statements  or the notes  thereto,  and
fairly  present in all material  respects the financial  position of the Company
and  its  consolidated  subsidiaries  as of and for the  dates  thereof  and the
results of operations and cash flows for the periods then ended, subject, in the
case of unaudited statements, to normal, immaterial, year-end audit adjustments.
Except as  specifically  disclosed in the SEC  Documents,  (a) there has been no
event,  occurrence  or  development  that has or that could result in a Material
Adverse Effect, (b) the Company has not incurred any liabilities  (contingent or
otherwise)  other  than (x)  liabilities  incurred  in the  ordinary  course  of
business  consistent  with past practice and (y)  liabilities not required to be
reflected in the Company's financial  statements pursuant to GAAP or required to
be  disclosed  in filings  made with the  Commission,  (c) the  Company  has not
altered its method of  accounting  or the  identity of its  auditors and (d) the
Company has not  declared or made any payment or  distribution  of cash or other
property to its  stockholders or officers or directors (other than in compliance
with existing  Company stock option plans) with respect to its capital stock, or
purchased, redeemed (or made any agreements to purchase or redeem) any shares of
its capital stock.

         (k) INVESTMENT COMPANY. The Company is not, and is not an Affiliate (as
defined in Rule 405 under the Securities Act) of, an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.

         (l) CERTAIN FEES. No fees or commissions will be payable by the Company
to any  broker,  financial  advisor  or  consultant,  finder,  placement  agent,
investment  banker,  bank or  other  Person  with  respect  to the  transactions
contemplated  by this  Agreement.  The Purchasers  shall have no obligation with
respect to any fees or with  respect to any claims made by or on behalf of other
Persons  for  fees of a type  contemplated  in this  Section  that may be due in
connection with the  transactions  contemplated  by this Agreement.  The Company
shall indemnify and hold harmless the  Purchasers,  their  employees,  officers,
directors,  agents,  and partners,  and their  respective  Affiliates,  from and
against all claims,  losses,  damages, costs (including the costs of preparation
and  attorney's  fees) and  expenses  suffered in respect of any such claimed or
existing fees, as such fees and expenses are incurred.

         (m) SOLICITATION  MATERIALS.  Neither the Company nor any Person acting
on the Company's behalf has solicited any offer to buy or sell the Securities by
means of any form of general solicitation or advertising.

         (n) FORM  ELIGIBILITY.  The Company is eligible to register  securities
for resale with the Commission under Form S-1 or Form SB-2 promulgated under the
Securities Act.

                                      -7-
<PAGE>
         (o) FORM S-3  ELIGIBILITY.  The Company  shall use its best  efforts to
become eligible to use Form S-3 promulgated under the Securities Act to register
its  securities for resale with the Commission no later than 12 months after the
Closing Date.

         (p) EXCLUSIVITY. The Company shall not issue and sell the Debentures to
any Person other than the Purchasers  without the specific prior written consent
of the Purchasers.

         (q)  SENIORITY.  No  indebtedness  of  the  Company  is  senior  to the
Debentures  in right of  payment,  whether  with  respect  to  interest  or upon
liquidation or dissolution, or otherwise, except for that certain Small Business
Administration  loan  made on March 19,  1999 by Union  Bank of  Arizona  in the
original principal amount of $1,000,000 (the "SBA LOAN").

         (r)  LISTING AND  MAINTENANCE  REQUIREMENTS  COMPLIANCE.  Except as set
forth in the SEC Documents, the Company has not, in the six months preceding the
date  hereof,  received  notice  (written  or oral) from the NASDAQ or any other
stock exchange,  market or trading  facility on which the Common Stock is or has
been  listed (or on which it has been  quoted) to the effect that the Company is
not in compliance with the listing or maintenance  requirements of such exchange
or market.  The Company is, and has no reason to believe that it will not in the
foreseeable  future  continue  to be, in  compliance  with all such  listing and
maintenance requirements.

         (s) PATENTS AND  TRADEMARKS.  The  Company  and its  Subsidiaries  have
rights  to  use,  all  patents,  patent  applications,   trademarks,   trademark
applications,  service marks, trade names, copyrights, licenses and rights which
are  necessary  or  material  for  use  in  connection  with  their   respective
businesses,  as described in the SEC  Documents and which the failure to so have
would have a Material Adverse Effect (collectively,  the "INTELLECTUAL  PROPERTY
RIGHTS").  To the best knowledge of the Company, all such Intellectual  Property
Rights are enforceable  and there is no existing  infringement by another Person
of any of the Intellectual Property Rights.

         (t) REGISTRATION RIGHTS;  RIGHTS OF PARTICIPATION.  Except as set forth
on  SCHEDULE  6(B) to the  Registration  Rights  Agreement,  the Company has not
granted  or agreed to grant to any Person  any  rights  (including  "piggy-back"
registration  rights) to have any securities of the Company  registered with the
Commission or any other governmental authority which has not been satisfied.  No
Person,   has  any  right  of  first  refusal,   preemptive   right,   right  of
participation,   or  any  similar  right  to  participate  in  the  transactions
contemplated by the Transaction Documents.

         (u) REGULATORY  PERMITS.  The Company and its Subsidiaries  possess all
certificates,  authorizations  and permits  issued by the  appropriate  federal,
state or foreign  regulatory  authorities  necessary to conduct their respective
businesses  as  described  in the SEC  Documents,  except  where the  failure to
possess such permits could not, individually or in the aggregate, have or result
in a Material Adverse Effect ("MATERIAL  PERMITS"),  and neither the Company nor
any such  Subsidiary  has  received  any notice of  proceedings  relating to the
revocation or modification of any Material Permit.

         (v) TITLE.  The Company and the  Subsidiaries  have good and marketable
title in fee simple to all real property  owned by them which is material to the
business of the Company and its  Subsidiaries  and good and marketable  title in

                                      -8-
<PAGE>
all  personal  property  owned by them which is material to the  business of the
Company and its Subsidiaries,  in each case free and clear of all Liens,  except
for Liens granted to the Purchasers  pursuant to the Security  Agreement and for
other Liens as do not  materially  affect the value of such  property and do not
interfere  with the use made and  proposed  to be made of such  property  by the
Company and its Subsidiaries.  Any real property and facilities held under lease
by the Company and its Subsidiaries are held by them under valid, subsisting and
enforceable  leases of which the Company and its  Subsidiaries are in compliance
and do not interfere  with the use made and proposed to be made of such property
and buildings by the Company and its Subsidiaries.

         (w)  ABSENCE OF CERTAIN  PROCEEDINGS.  Except as  described  in the SEC
Reports,  (i) there is no Action  pending or, to the  knowledge  of the Company,
threatened  against  the  Company,  in any  such  case  wherein  an  unfavorable
decision,  ruling or finding could have or result in a Material  Adverse Effect;
(ii)  neither  the  Company  nor any  Subsidiary,  nor any  director  or officer
thereof,  is or has been the  subject  of any  Action  involving  (A) a claim of
violation of or liability under federal or state  securities laws or (B) a claim
of breach of fiduciary duty;  (iii) the Company does not have pending before the
Commission any request for confidential treatment of information and the Company
has no knowledge  of any  expected  such request that would be made prior to the
Effectiveness Date (as defined in the Registration  Rights Agreement);  and (iv)
there  has not been,  and to the best of the  Company's  knowledge  there is not
pending or  contemplated,  any  investigation  by the  Commission  involving the
Company or any current or former director or officer of the Company.

         (x) LABOR  RELATIONS.  No  material  labor  problem  exists  or, to the
knowledge of the Company,  is imminent  with respect to any of the  employees of
the Company.

         (y)  DISCLOSURE.  The Company  confirms  that  neither it nor any other
Person acting on its behalf has provided any of the  Purchasers or its agents or
counsel with any  information  that  constitutes  or might  constitute  material
non-public information. The Company understands and confirms that the Purchasers
shall be relying on the foregoing  representations in effecting  transactions in
securities of the Company.  All disclosure provided to the Purchasers  regarding
the Company, its business and the transactions  contemplated  hereby,  including
the  Schedules to this  Agreement,  furnished by or on behalf of the Company are
true and correct and do not contain any untrue  statement of a material  fact or
omit to state any material fact necessary in order to make the  statements  made
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.

         (z)  AUTHORIZATION OF STOCK.  The Company  represents and warrants that
its Board of Directors has the authority and any necessary  approval to increase
the number of  authorized  shares of the  Company's  Common  Stock.  The Company
covenants and agrees that it shall  increase or cause to be increased the number
of  authorized  shares of the Company's  Common Stock to a total of  100,000,000
shares within 10 days of the Closing Date.

                                      -9-
<PAGE>
     2.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS. Each Purchaser hereby
for itself and for no other Purchaser  represents and warrants to the Company as
follows:

         (a)  ORGANIZATION;   AUTHORITY.   Such  Purchaser  is  an  entity  duly
organized,  validly  existing  and  in  good  standing  under  the  laws  of the
jurisdiction  of its  organization  with the requisite  corporate or partnership
power  and  authority  to  enter  into  and  to  consummate   the   transactions
contemplated  by the  Transaction  Documents  and  otherwise  to  carry  out its
obligations  thereunder.  The  purchase  by  such  Purchaser  of the  Securities
hereunder has been duly  authorized by all necessary  action on the part of such
Purchaser.  Each of this  Agreement,  the  Registration  Rights  Agreement,  the
Security  Agreement and the Intellectual  Property  Security  Agreement has been
duly  executed  by such  Purchaser,  and when  delivered  by such  Purchaser  in
accordance with the terms hereof,  will constitute the valid and legally binding
obligation of such  Purchaser,  enforceable  against it in  accordance  with its
terms.

         (b)  INVESTMENT  INTENT.  Such Purchaser is acquiring the Securities as
principal for its own account for  investment  purposes only and not with a view
to or for distributing or reselling such Securities or any part thereof, without
prejudice, however, to such Purchaser's right, subject to the provisions of this
Agreement  and  the  Registration  Rights  Agreement,  at all  times  to sell or
otherwise dispose of all or any part of such Securities pursuant to an effective
registration   statement  under  the  Securities  Act  and  in  compliance  with
applicable  federal and state  securities  laws or under an exemption  from such
registration.  Nothing  contained  herein  shall be deemed a  representation  or
warranty by such Purchaser to hold Securities for any amount of time.

         (c)  PURCHASER  STATUS.  At the time such  Purchaser  was  offered  the
Debentures  and its respective  Warrants,  it was, and at the date hereof it is,
and at each  exercise  date  under  its  respective  Warrants,  it will  be,  an
"accredited  investor" as defined in Rule 501(a) under the Securities  Act. Such
Purchaser  has  not  been  formed  solely  for  the  purpose  of  acquiring  the
Securities.

         (d)  EXPERIENCE  OF SUCH  PURCHASER.  Such  Purchaser,  either alone or
together  with its  representatives,  has  such  knowledge,  sophistication  and
experience in business and  financial  matters so as to be capable of evaluating
the merits and risks of the prospective investment in the Securities, and has so
evaluated the merits and risks of such investment.

         (e)  ABILITY  OF SUCH  PURCHASER  TO  BEAR  RISK  OF  INVESTMENT.  Such
Purchaser is able to bear the economic risk of an  investment in the  Securities
and, at the present time, is able to afford a complete loss of such investment.

         (f) ACCESS TO  INFORMATION.  Such  Purchaser  acknowledges  that it has
reviewed the Disclosure  Materials and has been afforded (i) the  opportunity to
ask such questions as it has deemed  necessary of, and to receive  answers from,
representatives  of the  Company  concerning  the  terms and  conditions  of the
offering  of the  Securities  and the  merits  and  risks  of  investing  in the
Securities;  (ii) access to  information  about the  Company  and the  Company's
financial condition, results of operations, business, properties, management and
prospects  sufficient  to enable it to evaluate  its  investment;  and (iii) the
opportunity to obtain such additional information which the Company possesses or

                                      -10-
<PAGE>
can acquire without  unreasonable effort or expense that is necessary to make an
informed  investment  decision with respect to the  investment and to verify the
accuracy  and  completeness  of the  information  contained  in  the  Disclosure
Materials. Neither such inquiries nor any other investigation conducted by or on
behalf of such Purchaser or its  representatives or counsel shall modify,  amend
or affect such Purchaser's right to rely on the truth, accuracy and completeness
of the  Disclosure  Materials and the Company's  representations  and warranties
contained in the Transaction Documents.

         (g)  GENERAL  SOLICITATION.   Such  Purchaser  is  not  purchasing  the
Securities as a result of or subsequent to any advertisement, article, notice or
other  communication  regarding  the  Securities  published  in  any  newspaper,
magazine or similar media or broadcast over  television or radio or presented at
any seminar or any other general solicitation or general advertisement.

         (h) RELIANCE.  Such Purchaser understands and acknowledges that (i) the
Securities  are being  offered  and sold to it  without  registration  under the
Securities  Act in a  private  placement  that is exempt  from the  registration
provisions of the Securities Act and (ii) the  availability  of such  exemption,
depends in part on, and the Company will rely upon the accuracy and truthfulness
of, the foregoing  representations  and such Purchaser  hereby  consents to such
reliance.

     The Company acknowledges and agrees that no Purchaser makes or has made any
representations  or  warranties  with respect to the  transactions  contemplated
hereby other than those specifically set forth in this Section 2.2.

                                   ARTICLE III
                         OTHER AGREEMENTS OF THE PARTIES

     3.1 TRANSFER RESTRICTIONS.  (a) Securities may only be disposed of pursuant
to an effective  registration statement under the Securities Act, to the Company
or pursuant to an available  exemption  from or in a transaction  not subject to
the registration  requirements of the Securities Act, and in compliance with any
applicable federal and state securities laws. In connection with any transfer of
Securities other than pursuant to an effective  registration statement or to the
Company,  except as  otherwise  set forth  herein,  the  Company may require the
transferor  thereof to provide to the Company an opinion of counsel  selected by
the  transferor,  the form and  substance of which  opinion  shall be reasonably
satisfactory  to the Company,  to the effect that such transfer does not require
registration  of  such   transferred   securities   under  the  Securities  Act.
Notwithstanding the foregoing, the Company, without requiring a legal opinion as
described in the immediately  preceding sentence,  hereby consents to and agrees
to  register on the books of the  Company  and with any  transfer  agent for the
securities  of the  Company  any  transfer of  Securities  by a Purchaser  to an
Affiliate of such  Purchaser or to one or more funds or managed  accounts  under
common  management  with  such  Purchaser,  and  any  transfer  among  any  such
Affiliates  or  one or  more  funds  or  managed  accounts,  provided  that  the
transferee  certifies  to the Company  that it is an  "accredited  investor"  as
defined in Rule 501(a) under the  Securities  Act and that it is  acquiring  the
Securities  solely  for  investment  purposes  (subject  to  the  qualifications
hereof).  Any such transferee shall agree in writing to be bound by the terms of

                                      -11-
<PAGE>
this Agreement and shall have the rights of a Purchaser under this Agreement and
the Registration Rights Agreement.

         (b) The Purchasers  agree to the imprinting,  so long as is required by
this Section 3.1(b), of the following legend on the Securities:

                  NEITHER THESE  SECURITIES NOR THE SECURITIES  INTO WHICH THESE
         SECURITIES ARE  [CONVERTIBLE]  [EXERCISABLE]  HAVE BEEN REGISTERED WITH
         THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES  COMMISSION OF
         ANY STATE IN RELIANCE  UPON AN EXEMPTION  FROM  REGISTRATION  UNDER THE
         SECURITIES  ACT OF  1933,  AS  AMENDED  (THE  "SECURITIES  ACT"),  AND,
         ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
         REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR  PURSUANT  TO AN
         AVAILABLE  EXEMPTION  FROM,  OR IN A  TRANSACTION  NOT  SUBJECT TO, THE
         REGISTRATION  REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
         APPLICABLE STATE SECURITIES LAWS.

         Underlying  Shares shall not contain the legend set forth above nor any
other legend if the  conversion  of  Debentures  and exercise of the Warrants or
other issuances of Underlying  Shares as contemplated  hereby, by the Debentures
or the  Warrants  occurs at any time  while an  Underlying  Shares  Registration
Statement is effective under the Securities Act or, in the event there is not an
effective Underlying Shares Registration Statement, at such time, in the opinion
of  counsel  to the  Company,  such  legend  is not  required  under  applicable
requirements  of the  Securities  Act (including  judicial  interpretations  and
pronouncements  issued by the staff of the Commission).  The Company shall cause
its  counsel  to  issue  the  legal  opinion  included  in  the  Transfer  Agent
Instructions  to the  Company's  transfer  agent on the day that the  Underlying
Shares  Registration  Statement  is declared  effective by the  Commission.  The
Company agrees that, in the event any Underlying Shares are issued with a legend
in accordance with this Section 3.1(b),  it will, within five Trading Days after
request  therefor by a Purchaser,  provide such  Purchaser with a certificate or
certificates  representing such Underlying Shares, free from such legend at such
time as such legend would not have been required  under this Section  3.1(b) had
such issuance occurred on the date of such request. The Company may not make any
notation  on its  records  or give  instructions  to any  transfer  agent of the
Company which enlarge the restrictions of transfer set forth in this Section.

     3.2 ACKNOWLEDGMENT OF DILUTION.  The Company acknowledges that the issuance
of the  Underlying  Shares upon (i)  conversion of the  Debentures in accordance
with  the  terms  of the  Debentures,  and  (ii)  exercise  of the  Warrants  in
accordance with their terms,  will result in dilution of the outstanding  shares
of  Common  Stock,  which  dilution  may be  substantial  under  certain  market
conditions.  The  Company  further  acknowledges  that its  obligation  to issue
Underlying  Shares upon (x) conversion of the Debentures in accordance  with the
terms of the  Debentures,  and (y) exercise of the Warrants in  accordance  with
their terms, is unconditional and absolute, subject to the limitations set forth
herein in the  Debentures or pursuant to the Warrants,  regardless of the effect
of any such dilution.

                                      -12-
<PAGE>
     3.3 FURNISHING OF  INFORMATION.  As long as the Purchasers own  Securities,
the Company  covenants to timely file (or obtain  extensions in respect  thereof
and file within the applicable grace period) all reports required to be filed by
the  Company  after the date hereof  pursuant  to Section  13(a) or 15(d) of the
Exchange Act. As long as the  Purchasers own  Securities,  if the Company is not
required to file reports pursuant to such sections,  it will prepare and furnish
to the  Purchasers  and make publicly  available in accordance  with Rule 144(c)
promulgated  under the  Securities  Act such  information as is required for the
Purchasers  to  sell  the  Securities  under  Rule  144  promulgated  under  the
Securities  Act. The Company  further  covenants  that it will take such further
action as any holder of Securities  may  reasonably  request,  all to the extent
required  from time to time to enable  such  Person  to sell  Underlying  Shares
without  registration  under the  Securities  Act within the  limitation  of the
exemptions  provided by Rule 144 promulgated under the Securities Act, including
the legal opinion referenced above in this Section. Upon the request of any such
Person,  the Company shall deliver to such Person a written  certification  of a
duly authorized officer as to whether it has complied with such requirements.

     3.4  INTEGRATION.  The Company shall not, and shall use its best efforts to
ensure that, no Affiliate of the Company shall,  sell, offer for sale or solicit
offers to buy or  otherwise  negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the  Securities  in a manner that would  require the  registration  under the
Securities Act of the sale of the Securities to the Purchasers.

     3.5 INCREASE IN AUTHORIZED  SHARES. If on any date the Company would be, if
a notice of  conversion or exercise (as the case may be) were to be delivered on
such date,  precluded  from (a)  issuing  (a) 200% of the  number of  Underlying
Shares as would then be issuable  upon a conversion  in full of the  Debentures,
and (b) the number of  Underlying  Shares  issuable upon exercise in full of the
Warrants  (the  "CURRENT  REQUIRED  MINIMUM"),   in  either  case,  due  to  the
unavailability  of a sufficient  number of  authorized  but unissued or reserved
shares of  Common  Stock,  then the  Board of  Directors  of the  Company  shall
promptly  (and in any case,  within 30 Business Days from such date) prepare and
mail to the stockholders of the Company proxy materials requesting authorization
to amend the Company's  certificate or articles of incorporation to increase the
number of shares of Common Stock which the Company is  authorized to issue to at
least such number of shares as reasonably  requested by the  Purchasers in order
to provide for such number of authorized and unissued  shares of Common Stock to
enable  the  Company  to  comply  with its  issuance,  conversion  exercise  and
reservation of shares obligations as set forth in this Agreement, the Debentures
and the  Warrants  (the sum of (x) the  number of shares  of Common  Stock  then
outstanding  plus all  shares of Common  Stock  issuable  upon  exercise  of all
outstanding options,  warrants and convertible instruments,  and (y) the Current
Required Minimum,  shall be a reasonable number). In connection  therewith,  the
Board of Directors shall (a) adopt proper resolutions authorizing such increase,
(b)  recommend to and otherwise use its best efforts to promptly and duly obtain
stockholder  approval to carry out such  resolutions (and hold a special meeting
of the  stockholders  no later  than the  earlier to occur of the 60th day after
delivery of the proxy materials  relating to such meeting and the 90th day after
request by a holder of Securities  to issue the number of  Underlying  Shares in
accordance with the terms hereof) and (c) within five Business Days of obtaining
such stockholder  authorization,  file an appropriate amendment to the Company's
certificate or articles of incorporation to evidence such increase.

                                      -13-
<PAGE>
     3.6 RESERVATION AND LISTING OF UNDERLYING SHARES. (a) The Company shall (i)
in the time and manner required by any national securities exchange or market or
trading or quotation facility on which the Common Stock is then traded,  prepare
and file with such national  securities exchange or market or quotation facility
on which the Common  Stock is then  listed  for  trading  an  additional  shares
listing  application  covering a number of shares of Common  Stock  which is not
less than the  Initial  Minimum,  (ii) take all steps  necessary  to cause  such
shares  of  Common  Stock  to be  approved  for  listing  on any  such  national
securities  exchange  or market or trading or  quotation  facility  on which the
Common Stock is then listed as soon as possible thereafter, and (iii) provide to
the  Purchasers  evidence of such listing,  and the Company  shall  maintain the
listing of its Common Stock thereon. If the number of Underlying Shares issuable
upon conversion in full of the then outstanding  Debentures and upon exercise of
the then  unexercised  portion  of the  Warrants  exceeds  85% of the  number of
Underlying  Shares  previously  listed on account thereof with any such required
exchanges),  then the Company  shall take the necessary  actions to  immediately
list a number of  Underlying  Shares  as  equals  no less than the then  Current
Required Minimum.

         (b) The Company shall  maintain a reserve of shares of Common Stock for
issuance upon  conversion of the Debentures in full and upon exercise in full of
the Warrants in accordance with this Agreement, the Debentures and the Warrants,
respectively,  in such amount as may be required to fulfill its  obligations  in
full under the Transaction Documents, which reserve shall equal no less than the
then Current Required Minimum.

     3.7 CONVERSION AND EXERCISE  PROCEDURES.  The Transfer Agent  Instructions,
Conversion  Notice (as defined in the  Debentures)  and Notice of Exercise under
the  Warrants  set forth the  totality  of the  procedures  with  respect to the
conversion of the Debentures and exercise of the Warrants, including the form of
legal opinion,  if necessary,  that shall be rendered to the Company's  transfer
agent and such other information and instructions as may be reasonably necessary
to enable the Purchasers to convert their Debentures and exercise their Warrants
as contemplated in the Debentures and the Warrants (as applicable).

     3.8 CONVERSION AND EXERCISE  OBLIGATIONS OF THE COMPANY.  The Company shall
honor  conversions  of the  Debentures  and  exercises of the Warrants and shall
deliver  Underlying Shares in accordance with the respective  terms,  conditions
and time periods set forth in the Debentures and the Warrants.

     3.9  SUBSEQUENT   FINANCING;   RIGHT  OF  FIRST   REFUSAL;   LIMITATION  ON
REGISTRATIONS.

     (a) Without the prior written consent of the Purchasers, prior to the 180th
day following  the  Effective  Date (such date will be extended by the number of
days  after  the  Effectiveness  Date (as  defined  in the  Registration  Rights
Agreement)  that an  Underlying  Shares  Registration  Statement  has  not  been
declared  effective  by the  Commission  and by the  number  of days  after  the
Effective  Date during which a Purchaser  is not  permitted or unable to utilize
the  prospectus or otherwise to resell  Underlying  Shares under the  Underlying
Shares Registration  Statement) (the "RESTRICTED PERIOD"),  the Company will not
offer, sell, grant any option to purchase,  or otherwise dispose of (or announce
any offer,  sale,  grant or any option to purchase or other  disposition) any of
its securities  (including  the issuance of any debt or other  instrument at any
time over the life thereof convertible into or exchangeable for Common Stock) or

                                      -14-
<PAGE>
any of its Affiliate's  securities that may be exchangeable or convertible  into
Common  Stock,  or  otherwise  enter into any other  transaction  intended to be
exempt or not subject to registration under the Securities Act (collectively,  a
"SUBSEQUENT  PLACEMENT"),  unless none of the  securities  issued or granted (or
securities  issuable  upon  conversion  or  exercise  thereof)  may be resold or
registered for issuance or resale under the Securities Act until the termination
of the Restricted  Period.  The restriction  contained in the foregoing sentence
shall not  apply to (i)  issuances  of  Common  Stock  pursuant  to a  Strategic
Transaction  (as defined  below),  (ii)  issuances  of shares of Common Stock as
payment  of the  purchase  price  for an  acquisition  of  assets or stock of an
unaffiliated Person, and (iii) the granting of options or warrants to employees,
officers and  directors  of the  Company,  and the issuance of Common Stock upon
exercise  of such  options  or  warrants  granted  under any stock  option  plan
heretofore or hereinafter duly adopted by the Company ("OPTION PLAN ISSUANCES").
A "STRATEGIC  TRANSACTION" shall mean a transaction or relationship in which the
Company  issues  shares of Common Stock to a Person which is,  itself or through
its subsidiaries,  an operating company in a business related to the business of
the Company and in which the Company receives  material  benefits in addition to
the  investment  of  funds,  but shall not  include a  transaction  in which the
Company is issuing securities primarily for the purpose of raising capital or to
an entity whose primary business is investing in securities.

     (b) Without the prior written consent of the Purchasers, prior to the 181th
day following the Effective Date, the Company shall not,  directly or indirectly
enter into a Subsequent  Placement,  unless: (A) the Company delivers to each of
the  Purchasers  a written  notice (the  "SUBSEQUENT  PLACEMENT  NOTICE") of its
intention to effect such Subsequent Placement, which Subsequent Placement Notice
shall  describe  in  reasonable  detail the  proposed  terms of such  Subsequent
Placement,  the amount of proceeds intended to be raised thereunder,  the Person
with whom such  Subsequent  Placement  shall be effected,  and attached to which
shall  be a term  sheet  or  similar  document  relating  thereto  and (B)  such
Purchaser  shall not have notified the Company by 6:30 p.m. (New York City time)
on the tenth Trading Day after its receipt of the Subsequent Placement Notice of
its  willingness to provide (or to cause its sole designee to provide),  subject
to completion of mutually acceptable documentation,  financing to the Company on
the same terms set forth in the Subsequent  Placement  Notice. If the Purchasers
shall  fail to  notify  the  Company  of  their  intention  to enter  into  such
negotiations  within such time  period,  the  Company may effect the  Subsequent
Placement substantially upon the terms and to the Persons (or Affiliates of such
Persons)  set  forth in the  Subsequent  Placement  Notice,  PROVIDED,  that the
Company shall provide the Purchasers with a second Subsequent  Placement Notice,
and the  Purchasers  shall again have the right of first refusal set forth above
in this  paragraph  (b),  if the  Subsequent  Placement  subject to the  initial
Subsequent  Placement  Notice shall not have been  consummated for any reason on
the terms set forth in such  Subsequent  Placement  Notice within thirty Trading
Days after the date of the initial  Subsequent  Placement Notice with the Person
(or an Affiliate of such Person) identified in the Subsequent  Placement Notice.
If the Purchasers shall indicate a willingness to provide financing in excess of
the amount set forth in the  Subsequent  Placement  Notice,  then each Purchaser
shall be entitled to provide  financing  pursuant to such  Subsequent  Placement
Notice  up to an  amount  equal  to such  Purchaser's  pro-rata  portion  of the
aggregate number of Shares purchased by such Purchaser under this Agreement, but
the Company shall not be required to accept  financing from the Purchasers in an
amount in excess of the amount set forth in the Subsequent Placement Notice. The
restrictions of this subsection  shall not apply to: (i) a Subsequent  Placement
in which the securities  (and  securities  issuable upon  conversion or exercise

                                      -15-
<PAGE>
thereof)  shall  be  restricted  from  resale  and  conversion  and  will not be
registered  for issuance or resale for at least 365 days  following the issuance
date thereof,  (ii)  issuances of shares of Common Stock pursuant to a Strategic
Transaction,  (iii)  issuances  of  shares  of Common  Stock as  payment  of the
purchase price for an acquisition of assets or stock of an  unaffiliated  Person
and (iv) Option Plan Issuances.

         (c)  Except  for  (x)  Underlying   Shares,   (y)  other   "Registrable
Securities" (as such term is defined in the Registration Rights Agreement) to be
registered, and securities of the Company permitted pursuant to Schedule 6(b) of
the Registration's  Rights Agreement to be registered,  in the Underlying Shares
Registration Statement in accordance with the Registration Rights Agreement, and
(z) Common Stock permitted to be issued  pursuant to paragraph  (a)(i)- (iii) of
Section 3.9(a),  the Company shall not, for a period of not less than 90 Trading
Days  after  the date  that the  Underlying  Shares  Registration  Statement  is
declared  effective by the Commission,  without the prior written consent of the
Purchasers  (i)  issue or sell any of its or any of its  Affiliates'  equity  or
equity-equivalent  securities  pursuant to  Regulation S  promulgated  under the
Securities Act, or (ii) register any securities of the Company.  Any days that a
Purchaser  is unable to sell  Underlying  Shares  under  the  Underlying  Shares
Registration Statement shall be added to such 90 Trading Day period.

     3.10 CERTAIN SECURITIES LAWS DISCLOSURES; PUBLICITY. The Company shall: (i)
on the  Closing  Date  issue  a  press  release  acceptable  to  the  Purchasers
disclosing the transactions contemplated hereby, (ii) file with the Commission a
Report on Form 8-K disclosing the  transactions  contemplated  hereby within ten
Business Days after the Closing Date,  and (iii) timely file with the Commission
a Form D promulgated  under the Securities  Act as required  under  Regulation D
promulgated  under  the  Securities  Act  and  provide  a  copy  thereof  to the
Purchasers  promptly after the filing  thereof.  The Company shall, no less than
two Business Days prior to the filing of any disclosure required by clauses (ii)
and (iii)  above,  provide a copy thereof to the  Purchasers.  No such filing or
disclosure  may be made that  mentions the  Purchasers by name without the prior
consent of the  Purchasers.  The Company and the  Purchasers  shall consult with
each other in issuing any press releases or otherwise  making public  statements
or filings and other communications with the Commission or any regulatory agency
or  stock  market  or  trading   facility  with  respect  to  the   transactions
contemplated  hereby and neither  party  shall  issue any such press  release or
otherwise  make any  such  public  statement,  filings  or other  communications
without  the prior  written  consent of the other,  which  consent  shall not be
unreasonably withheld or delayed, except that no prior consent shall be required
if such  disclosure is required by law, in which such case the disclosing  party
shall provide the other party with prior notice of such public statement, filing
or other  communication.  Notwithstanding  the foregoing,  the Company shall not
publicly  disclose  the names of the  Purchasers,  or  include  the names of the
Purchasers in any filing with the Commission,  or any regulatory agency, trading
facility or stock market  without the prior written  consent of the  Purchasers,
except  to  the  extent  such  disclosure  (but  not  any  disclosure  as to the
controlling Persons thereof) is required by law, in which case the Company shall
provide the Purchasers with prior notice of such disclosure.

     3.11 TRANSFER OF INTELLECTUAL  PROPERTY  RIGHTS.  Except in connection with
the sale of all or  substantially  all of the assets of the Company or licensing
arrangements in the ordinary course of the Company's business, the Company shall
not transfer,  sell or otherwise dispose of any Intellectual Property Rights, or
allow any of the Intellectual Property Rights to become subject to any Liens, or
fail to renew such Intellectual Property Rights (if

                                      -16-
<PAGE>
renewable  and it would  otherwise  lapse if not  renewed),  without  the  prior
written consent of the Purchasers.

     3.12 USE OF PROCEEDS.  The Company shall use the net proceeds from the sale
of the  Securities  hereunder  for  working  capital  purposes  and  not for the
satisfaction  of any portion of the Company's  debt (other than payment of trade
payables in the ordinary course of the Company's  business and prior practices),
to redeem any Company  equity or  equity-equivalent  securities or to settle any
outstanding litigation.

     3.13  REIMBURSEMENT.  If any  Purchaser,  other than by reason of its gross
negligence  or willful  misconduct,  becomes  involved  in any  capacity  in any
action,  proceeding or investigation brought by or against any Person, including
stockholders  of  the  Company,  in  connection  with  or  as a  result  of  the
consummation  of the  transactions  contemplated by Transaction  Documents,  the
Company  will  reimburse  such  Purchaser  for its  reasonable  legal  and other
expenses  (including the cost of any investigation and preparation)  incurred in
connection  therewith,  as such expenses are incurred.  In addition,  other than
with respect to any matter in which a Purchaser  is a named  party,  the Company
will pay such Purchaser the charges, as reasonably determined by such Purchaser,
for the time of any officers or employees of such Purchaser devoted to appearing
and preparing to appear as  witnesses,  assisting in  preparation  for hearings,
trials or pretrial  matters,  or otherwise with respect to inquiries,  hearings,
trials, and other proceedings  relating to the subject matter of this Agreement.
The  reimbursement  obligations of the Company under this paragraph  shall be in
addition to any  liability  which the Company may otherwise  have,  shall extend
upon the same terms and  conditions to any  Affiliates of the Purchasers who are
actually  named in such  action,  proceeding  or  investigation,  and  partners,
directors,  agents,  employees and controlling persons (if any), as the case may
be, of the  Purchasers  and any such  Affiliate,  and shall be binding  upon and
inure  to  the  benefit  of  any   successors,   assigns,   heirs  and  personal
representatives  of the Company,  the  Purchasers and any such Affiliate and any
such Person.  The Company also agrees that neither the  Purchasers  nor any such
Affiliates,  partners, directors, agents, employees or controlling persons shall
have any liability to the Company or any Person asserting claims on behalf of or
in right of the Company in connection with or as a result of the consummation of
the Transaction Documents except to the extent that any losses, claims, damages,
liabilities or expenses incurred by the Company result from the gross negligence
or willful  misconduct of the applicable  Purchaser or entity in connection with
the transactions contemplated by this Agreement.

                                      -17-
<PAGE>
                                   ARTICLE IV
                                  MISCELLANEOUS

     4.1 FEES AND  EXPENSES.  At the Closing,  the Company  shall  reimburse the
Purchasers  for their legal fees and expenses  incurred in  connection  with the
preparation  and  negotiation  of the  Transaction  Documents by  authorizing  a
payment  out of  escrow  in the  amount  of  $15,000  for  the  preparation  and
negotiation  of  the  Transaction  Documents.  The  amount  contemplated  by the
immediately preceding sentence shall be retained by the Purchasers and shall not
be delivered to the Company at the Closing.  Other than the amount  contemplated
in the immediately preceding sentence,  and except as otherwise set forth in the
Registration Rights Agreement, each party shall pay the fees and expenses of its
advisers, counsel, accountants and other experts, if any, and all other expenses
incurred by such party  incident  to the  negotiation,  preparation,  execution,
delivery and performance of this Agreement.  The Company shall pay all stamp and
other taxes and duties levied in connection with the issuance of the Securities.

     4.2 ENTIRE AGREEMENT;  AMENDMENTS. The Transaction Documents, together with
the Exhibits and Schedules thereto and the Transfer Agent  Instructions  contain
the entire  understanding  of the parties  with  respect to the  subject  matter
hereof and supersede all prior agreements and  understandings,  oral or written,
with respect to such  matters,  which the parties  acknowledge  have been merged
into such documents, exhibits and schedules.

     4.3  NOTICES.  Any and all notices or other  communications  or  deliveries
required or permitted to be provided  hereunder shall be in writing and shall be
deemed given and effective on the earliest of (i) the date of  transmission,  if
such  notice or  communication  is  delivered  via  facsimile  at the  facsimile
telephone  number  specified in this Section  prior to 6:30 p.m.  (New York City
time) on a Business Day,  (ii) the Business Day after the date of  transmission,
if such notice or  communication  is delivered  via  facsimile at the  facsimile
telephone number specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the  Business Day  following  the date of mailing,  if sent by  nationally
recognized  overnight courier service,  or (iv) upon actual receipt by the party
to whom such notice is required  to be given.  The address for such  notices and
communications shall be as follows:

         If to the Company:   5002 South Ash Avenue
                              Tempe, AZ 85282
                              Facsimile No.: (480) 820-2319
                              Attn:  Chief Financial Officer

         If to a Purchaser:   To the address set forth under such Purchaser's
                              name on the signature pages hereto.

or such other  address as may be designated  in writing  hereafter,  in the same
manner, by such Person.

     4.4  AMENDMENTS;  WAIVERS.  No provision of this Agreement may be waived or
amended except in a written instrument  signed, in the case of an amendment,  by
the Company and each of the Purchasers or, in the case of a waiver, by the party
against whom enforcement of any such waiver is sought.  No waiver of any default

                                      -18-
<PAGE>
with respect to any provision,  condition or requirement of this Agreement shall
be  deemed  to be a  continuing  waiver  in the  future or a waiver of any other
provision,  condition or requirement  hereof, nor shall any delay or omission of
either party to exercise any right  hereunder in any manner  impair the exercise
of any such right accruing to it thereafter.

     4.5  HEADINGS.  The  headings  herein  are  for  convenience  only,  do not
constitute a part of this  Agreement  and shall not be deemed to limit or affect
any of the provisions hereof.

     4.6 SUCCESSORS AND ASSIGNS.  This Agreement shall be binding upon and inure
to the benefit of the parties and their  successors and permitted  assigns.  The
Company may not assign this  Agreement  or any rights or  obligations  hereunder
without  the prior  written  consent of the  Purchasers.  Except as set forth in
Section  3.1(a),  the  Purchasers  may not assign this  Agreement  or any of the
rights or  obligations  hereunder  without  the  consent  of the  Company.  This
provision  shall not limit  any  Purchaser's  right to  transfer  securities  or
transfer or assign rights under the Registration Rights Agreement.

     4.7 NO  THIRD-PARTY  BENEFICIARIES.  This  Agreement  is  intended  for the
benefit of the parties  hereto and their  respective  successors  and  permitted
assigns and is not for the benefit of, nor may any provision  hereof be enforced
by, any other Person.

     4.8 GOVERNING  LAW. The corporate  laws of the State of Nevada shall govern
all issues  concerning the relative rights of the Company and its  stockholders.
All other  questions  concerning the  construction,  validity,  enforcement  and
interpretation of this Agreement shall be governed by and construed and enforced
in accordance with the internal laws of the State of New York, without regard to
the  principles  of  conflicts of law  thereof.  Each party  hereby  irrevocably
submits to the exclusive jurisdiction of the state and federal courts sitting in
the City of New York, borough of Manhattan,  for the adjudication of any dispute
hereunder or in connection herewith or with any transaction  contemplated hereby
or discussed herein (including with respect to the enforcement of the any of the
Transaction Documents),  and hereby irrevocably waives, and agrees not to assert
in any suit, action or proceeding,  any claim that it is not personally  subject
to the jurisdiction of any such court,  that such suit,  action or proceeding is
improper.  Each party hereby  irrevocably waives personal service of process and
consents  to process  being  served in any such suit,  action or  proceeding  by
mailing a copy thereof via  registered or certified  mail or overnight  delivery
(with  evidence of  delivery) to such party at the address in effect for notices
to it under this  Agreement and agrees that such service shall  constitute  good
and sufficient  service of process and notice thereof.  Nothing contained herein
shall be  deemed to limit in any way any right to serve  process  in any  manner
permitted by law.

     4.9 SURVIVAL.  The  representations,  warranties,  agreements and covenants
contained  herein shall  survive the Closing and the delivery and  conversion or
exercise (as the case may be) of the Debentures and the Warrants.

     4.10 EXECUTION. This Agreement may be executed in two or more counterparts,
all of which when taken  together shall be considered one and the same agreement
and shall become effective when  counterparts have been signed by each party and

                                      -19-
<PAGE>
delivered to the other  party,  it being  understood  that both parties need not
sign the same  counterpart.  In the event that any  signature  is  delivered  by
facsimile  transmission,  such  signature  shall  create  a  valid  and  binding
obligation  of the  party  executing  (or on  whose  behalf  such  signature  is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.

     4.11  SEVERABILITY.  In case  any one or  more  of the  provisions  of this
Agreement  shall be invalid or  unenforceable  in any respect,  the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be  affecting  or impaired  thereby and the parties  will  attempt to
agree  upon a valid  and  enforceable  provision  which  shall  be a  reasonable
substitute  therefor,  and upon so agreeing,  shall  incorporate such substitute
provision in this Agreement.


     4.12  REMEDIES.  In  addition  to being  entitled  to  exercise  all rights
provided herein or granted by law,  including  recovery of damages,  each of the
Purchasers  will be entitled to specific  performance of the  obligations of the
Company under the Transaction Documents.  The Company and each of the Purchasers
agree  that  monetary  damages  may not be  adequate  compensation  for any loss
incurred by reason of any breach of its  obligations  described in the foregoing
sentence and hereby  agrees to waive in any action for specific  performance  of
any such obligation the defense that a remedy at law would be adequate.

     4.13  INDEPENDENT  NATURE  OF  PURCHASERS'   OBLIGATIONS  AND  RIGHTS.  The
obligations of each Purchaser under any Transaction  Document is several and not
joint with the  obligations  of any other  Purchaser  and no Purchaser  shall be
responsible  in any way for the  performance  of the  obligations  of any  other
Purchaser under any Transaction  Document.  Nothing  contained  herein or in any
Transaction  Document,  and no action taken by any Purchaser  pursuant  thereto,
shall be deemed to constitute the Purchasers as a partnership, an association, a
joint  venture  or any other kind of entity,  or create a  presumption  that the
Purchasers are in any way acting in concert with respect to such  obligations or
the transactions  contemplated by the Transaction Document. Each Purchaser shall
be entitled to independently  protect and enforce its rights,  including without
limitation  the  rights  arising  out of  this  Agreement  or  out of the  other
Transaction Documents,  and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose.

     4.14  REPRESENTATION  BY COUNSEL.  Each party hereto represents that it has
been  represented  by  counsel  of its own  selection  in  connection  with  the
transaction contemplated hereby. Each purchaser is relying solely on its own due
diligence  conducted in connection  with the  contemplated  transaction  and the
representations and warranties of the Company.

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                            SIGNATURE PAGES FOLLOWS]
<PAGE>
     IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this  Convertible
Debenture Purchase Agreement to be duly executed by their respective  authorized
signatories as of the date first indicated above.


                                    ACCORD ADVANCED TECHNOLOGIES, INC.


                                    By /s/ Travis Wilson
                                       -----------------------------------------
                                       Name: Travis Wilson
                                       Title: Chief Executive Officer


                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                      SIGNATURE PAGE FOR PURCHASER FOLLOWS]
<PAGE>
                      AJW PARTNERS, LLC
                      By: SMS Group, LLC


                      By: /s/ Corey S. Ribotsky
                          --------------------------------
                          Name: Corey S. Ribotsky
                          Title:

                      Debentures Purchase Price
                      due on the Closing Date:                        $50,000.00

                      Debentures Purchase Price
                      due after the Effective Date:                   $50,000.00


                      Number of Shares underlying
                      Warrant due on the Closing Date                     50,000

                      Number of Shares underlying
                      Warrant due after the Effective Date                50,000

                      Address for Notice:

                      AJW Partners, LLC
                      155 First Street
                      Suite B
                      Mineola, New York 11501
                      Facsimile No.: (516) 739-7115
                      Attn: Corey S. Ribotsky


                  With copies to: Robinson Silverman Pearce Aronsohn &
                                    Berman LLP
                                  1290 Avenue of the Americas
                                  New York, NY  10104
                                  Facsimile No.:  (212) 541-4630
                                  Attn: Eric L. Cohen, Esq.
<PAGE>
                      NEW MILLENIUM CAPITAL PARTNERS II, LLC
                      By: First Street Manager II, LLC


                      By: /s/ GLENN A. ARBEITMAN
                          --------------------------------------------
                          Name: Glenn A. Arbeitman
                          Title:

                      Debentures Purchase Price
                      due on the Closing Date:                       $450,000.00

                      Debentures Purchase Price
                      due after the Effective Date:                  $450,000.00


                      Number of Shares underlying
                      Warrant due on the Closing Date                    450,000

                      Number of Shares underlying
                      Warrant due after the Effective Date               450,000

                      Address for Notice:

                      New Millenium Capital Partners II, LLC
                      155 First Street
                      Suite B
                      Mineola, New York 11501
                      Facsimile No.: (516) 739-7115
                      Attn: Glenn A. Arbeitman

                 With copies to: Robinson Silverman Pearce Aronsohn &
                                   Berman LLP
                                 1290 Avenue of the Americas
                                 New York, NY  10104
                                 Facsimile No.:  (212) 541-4630
                                 Attn: Eric L. Cohen, Esq.