[EXHIBIT 10.1]

                          SECURITIES PURCHASE AGREEMENT
                          -----------------------------


     SECURITIES  PURCHASE  AGREEMENT  (this  "Agreement"),  dated as of April 1,
2004, by and between RAPTOR NETWORKS  TECHNOLOGY,  INC., a Colorado  corporation
(the  "Company"),  and each of the entities  whose names appear on the signature
       -------
pages hereof.  Such  entities are each referred to herein as an "Investor"  and,
                                                                 --------
collectively, as the "Investors".
                      ---------

     The Company  wishes to sell to each Investor,  and each Investor  wishes to
purchase,  on the  terms  and  subject  to the  conditions  set  forth  in  this
Agreement,  (i) shares (the "Shares") of the Company's  common stock,  par value
                             ------
$.001 per  share  (the  "Common  Stock"),  (ii) a Series A  Warrant  in the form
                         -------------
attached  hereto as  Exhibit A (a  "Series A  Warrant"  and,  collectively,  the
                     ---------      -----------------
"Series A Warrants") and (iii) a Series B Warrant in the form attached hereto as
 -----------------
Exhibit B (a "Series B Warrant" and, collectively, the "Series B Warrants"). The
---------     ----------------                          -----------------
Series A Warrants and the Series B Warrants are collectively  referred to herein
as the "Warrants".
        --------

     Each Series A Warrant  issued to an Investor  will entitle such Investor to
purchase  a number  of  shares of  Common  Stock  equal to the  number of Shares
purchased by such  Investor at the Closing.  The Series A Warrants  will have an
exercise  price  equal to $2.25 per share  (subject  to  adjustment  as provided
therein) and will expire on the sixtieth (60th) day following the Effective Date
(as defined  below).  Each Series B Warrant  issued to an Investor  will entitle
such Investor to purchase a number of shares of Common Stock equal to the number
of Shares purchased by such Investor at the Closing.  The Series B Warrants will
have an  exercise  price  equal to $3.50 per share  (subject  to  adjustment  as
provided  therein) and will expire on the fifth (5th) anniversary of the Closing
Date.

     The shares of Common  Stock into which the  Warrants  are  exercisable  are
referred to herein as the  "Warrant  Shares".  The Shares and the  Warrants  are
                            ---------------
collectively referred to herein as the "Purchased Securities", and the Purchased
                                        --------------------
Securities and the  Registrable  Securities (as defined below) are  collectively
referred to herein as the "Securities".
                           ----------

     The  Company  has  agreed to effect  the  registration  of the  Registrable
Securities under the Securities Act of 1933, as amended (the "Securities  Act"),
                                                              ---------------
pursuant to a  Registration  Rights  Agreement  in the form  attached  hereto as
Exhibit C (the "Registration  Rights Agreement").  The sale of the Securities by
---------       ------------------------------
the Company to the  Investors  will be effected in reliance  upon the  exemption
from  securities  registration  afforded  by  the  provisions  of  Regulation  D
("Regulation D"), as promulgated by the Securities and Exchange  Commission (the
  ------------
"Commission") under the Securities Act.
 ----------

     In  consideration  of the mutual  promises made herein,  and other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the Company and each Investor hereby agree as follows:



<PAGE>






1.   PURCHASE AND SALE OF SHARES, ADDITIONAL INVESTMENT RIGHTS AND WARRANTS.
     ----------------------------------------------------------------------

     1.1  Purchase and Sale of Purchased Securities.  Upon the terms and subject
          -----------------------------------------
to the  satisfaction  or waiver of the conditions set forth herein,  the Company
agrees to sell and each Investor agrees to purchase (i) the number of Shares set
forth below such Investor's name on the signature pages hereof,  (ii) a Series A
Warrant  and (ii) a Series B  Warrant.  The  purchase  price  for the  Purchased
Securities being purchased by an Investor (the "Purchase  Price") shall be equal
                                                ---------------
to (x) the number of Shares purchased by such Investor times (y) $1.75, provided
                                                       -----
that the Purchase Price shall be allocated among the Purchased Securities as may
be agreed to among the Company and such Investor.  The date on which the closing
of the purchase and sale of the Purchased  Securities  occurs (the "Closing") is
                                                                    -------
hereinafter  referred to as the  "Closing  Date".  The Closing will be deemed to
                                  -------------
occur when (A) this  Agreement and the other  Transaction  Documents (as defined
below)  have been  executed  and  delivered  by the  Company  and, to the extent
applicable, by each Investor, (B) each of the conditions to Closing described in
Section 5 hereof  has been  satisfied  or waived as  specified  therein  and (C)
except as otherwise  provided in the  following  sentence,  full payment of each
Investor's  Purchase Price has been made by such Investor to the Company by wire
transfer of immediately available funds against physical delivery by the Company
of duly executed certificates representing the Purchased Securities purchased by
such Investor at the Closing. Notwithstanding the foregoing, Satellite Strategic
Finance  Associates,  LLC ("Satellite") shall withhold and apply $125,397 of its
                            ---------
Purchase  Price to pay the  insurance  premiums on the  Insurance  Policies  (as
defined below) at Closing.

     1.2  Certain Definitions.  When used herein, the following terms shall have
          -------------------
the respective meanings indicated:

               "Affiliate" means, as to any Person (the "subject  Person"),  any
                ---------                                ---------------
other Person (a) that directly or indirectly through one or more  intermediaries
controls or is  controlled  by, or is under  direct or indirect  common  control
with, the subject Person,  (b) that directly or indirectly  beneficially owns or
holds ten  percent  (10%) or more of any class of voting  equity of the  subject
Person,  or (c) ten  percent  (10%)  or more of the  voting  equity  of which is
directly or indirectly beneficially owned or held by the subject Person. For the
purposes  of this  definition,  "control"  when used with  respect to any Person
                                 -------
means the power to direct the management  and policies of such Person,  directly
or  indirectly,  whether  through the  ownership of voting  securities,  through
representation on such Person's Board of Directors or other management committee
or group, by contract or otherwise.

               "Business Day" means any day other than a Saturday, a Sunday or a
                ------------
day on which the New York Stock Exchange or commercial banks located in New York
City are authorized or permitted by law to close.

               "Closing"  and  "Closing  Date"  have  the  respective   meanings
                -------         -------------
specified in Section 1.1 hereof.

               "Common  Stock"  means the  common  stock,  par value  $0.001 per
                -------------
share, of the Company.



                                        2
<PAGE>






               "Debt" means, as to any Person at any time: (a) all indebtedness,
                ----
liabilities  and  obligations  of  such  Person  for  borrowed  money;  (b)  all
indebtedness,  liabilities  and  obligations  of such Person to pay the deferred
purchase price of Property or services,  except trade  accounts  payable of such
Person arising in the ordinary  course of business that are not past due by more
than 90 days; (c) all capital lease obligations of such Person;  (d) all Debt of
others  guaranteed  by  such  Person;  (e)  all  indebtedness,  liabilities  and
obligations secured by a Lien existing on Property owned by such Person, whether
or not the  indebtedness,  liabilities or obligations  secured thereby have been
assumed by such Person or are non-recourse to such Person; (f) all reimbursement
obligations  of such Person  (whether  contingent  or  otherwise)  in respect of
letters of  credit,  bankers'  acceptances,  surety or other  bonds and  similar
instruments;  and (g) all  indebtedness,  liabilities  and  obligations  of such
Person to redeem or retire shares of capital stock of such Person.

               "Disclosure  Documents"  means  all SEC  Documents  filed  by the
                ---------------------
Company at least two (2) Business  Days prior to the date of this  Agreement via
the  Commission's  Electronic  Data  Gathering,  Analysis and  Retrieval  system
(EDGAR) in accordance with the requirements of Regulation S-T under the Exchange
Act.

               "Effective  Date" has the meaning  set forth in the  Registration
                ---------------
Rights Agreement.

               "Environmental Law" means any federal, state,  provincial,  local
                -----------------
or foreign law,  statute,  code or  ordinance,  principle of common law, rule or
regulation, as well as any Permit, order, decree, judgment or injunction issued,
promulgated,  approved  or entered  thereunder,  relating  to  pollution  or the
protection,  cleanup or restoration of the environment or natural resources,  or
to the public  health or safety,  or otherwise  governing the  generation,  use,
handling, collection,  treatment, storage, transportation,  recovery, recycling,
discharge or disposal of hazardous materials.

               "ERISA"  means the  Employee  Retirement  Income  Security Act of
                -----
1974, as amended, and the regulations and published interpretations thereunder.

               "Exchange  Act" means the  Securities  Exchange  Act of 1934,  as
                -------------
amended (or any successor  act),  and the rules and  regulations  thereunder (or
respective successors thereto).

               "GAAP" means generally accepted accounting principles, applied on
                ----
a consistent  basis,  as set forth in (i) opinions of the Accounting  Principles
Board of the American Institute of Certified Public Accountants, (ii) statements
of the Financial  Accounting  Standards Board and (iii)  interpretations  of the
Commission and the Staff of the Commission. Accounting principles are applied on
a "consistent basis" when the accounting  principles applied in a current period
are comparable in all material respects to those accounting  principles  applied
in a preceding period.

               "Governmental  Authority"  means any  nation or  government,  any
                -----------------------
state,  provincial or political  subdivision  thereof and any entity  exercising
executive,  legislative,  judicial, regulatory or administrative functions of or
pertaining to  government,  including  without  limitation  any stock  exchange,
securities market or self-regulatory organization.



                                        3
<PAGE>






               "Governmental   Requirement"   means  any  law,  statute,   code,
                --------------------------
ordinance,  order, rule, regulation,  judgment, decree,  injunction,  franchise,
license  or other  directive  or  requirement  of any  federal,  state,  county,
municipal, parish, provincial or other Governmental Authority or any department,
commission, board, court, agency or any other instrumentality of any of them.

               "Indemnity   Agreement"  means  the  Indemnity   Agreement  being
                ---------------------
delivered by Ananda  Perera and Edwin Hoffman at Closing in favor of the Company
and the Investors.

               "Insurance  Binder" means an insurance binder that is in form and
                -----------------
substance  reasonably  satisfactory to the Investors setting forth,  among other
things,  the types and  amount  of  insurance  coverage  to be  obtained  by the
Company, and the insurance premiums payable for the first year of such coverage.

               "Insurance  Policies" means the insurance  policies providing all
                -------------------
of the coverages contemplated by the Insurance Binder.

               "Intellectual Property" means any U.S. or foreign patents, patent
                ---------------------
rights,  patent  applications,  trademarks,  trade names,  service marks,  brand
names,  logos and other trade  designations  (including  unregistered  names and
marks),  trademark and service mark  registrations and applications,  copyrights
and copyright registrations and applications, inventions, invention disclosures,
protected formulae,  formulations,  processes,  methods, trade secrets, computer
software, computer programs and source codes, manufacturing research and similar
technical information,  engineering know-how, customer and supplier information,
assembly and test data drawings or royalty rights.

               "Lien"  means,  with  respect to any  Property,  any  mortgage or
                ----
mortgages,  pledge,  hypothecation,  assignment,  deposit arrangement,  security
interest, tax lien, financing statement,  pledge, charge, or other lien, charge,
easement,  encumbrance,  preference,  priority or other  security  agreement  or
preferential  arrangement of any kind or nature whatsoever on or with respect to
such Property  (including,  without  limitation,  any conditional  sale or other
title retention  agreement having  substantially the same economic effect as any
of the foregoing).

               "Material Adverse Effect" means an effect that has a material and
                -----------------------
adverse  effect  on  (i)  the  consolidated  business,  operations,  properties,
financial  condition,  prospects or results of operations of the Company and its
Subsidiaries  taken  as a whole or (ii) the  transactions  contemplated  by this
Agreement or the other Transaction Documents (as defined below).

               "Material  Contracts"  means,  as to the Company,  any  agreement
                -------------------
required  pursuant to Item 601 of Regulation S-B or Item 601, as applicable,  of
Regulation S-K under the Securities Act to be filed as an exhibit to any report,
schedule, registration statement or definitive proxy statement filed or required
to be filed by the Company  with the  Commission  under the  Exchange Act or any
rule  or  regulation  promulgated  thereunder,   and  any  and  all  amendments,
modifications, supplements, renewals or restatements thereof.




                                        4
<PAGE>






               "NASD" means the National Association of Securities Dealers, Inc.
                ----

               "Outstanding  Registrable  Securities"  means,  at any time,  all
                ------------------------------------
Registrable  Securities  outstanding,  or issuable upon exercise of the Warrants
(without regard to any limitation on such exercise), at such time.

               "Pension  Plan"  means an  employee  benefit  plan (as defined in
                -------------
ERISA)  maintained  by the  Company for  employees  of the Company or any of its
Affiliates.

               "Permitted Liens" means the following:
                ---------------

               (a)  encumbrances consisting of easements,  rights-of-way, zoning
     restrictions  or  other  restrictions  on  the  use  of  real  Property  or
     imperfections  to  title  that do not  (individually  or in the  aggregate)
     materially  impair the ability of the Company or any of its Subsidiaries to
     use such Property in its  businesses,  and none of which is violated in any
     material respect by existing or proposed structures or land use;

               (b)  Liens for taxes,  assessments or other governmental  charges
     that are not  delinquent  or which are  being  contested  in good  faith by
     appropriate  proceedings,  which  proceedings have the effect of preventing
     the forfeiture or sale of the Property subject to such Liens, and for which
     adequate  reserves  (as  determined  in  accordance  with  GAAP)  have been
     established; and

               (c)  Liens of  mechanics,  materialmen,  warehousemen,  carriers,
     landlords or other similar  statutory Liens securing  obligations  that are
     not yet due and are  incurred in the  ordinary  course of business or which
     are  being  contested  in good  faith  by  appropriate  proceedings,  which
     proceedings  have the effect of  preventing  the  forfeiture or sale of the
     Property subject to such Liens, for which adequate  reserves (as determined
     in accordance with GAAP) have been established.

               "Person" means any individual,  corporation,  trust, association,
                ------
company,  partnership,  joint venture,  limited liability  company,  joint stock
company, Governmental Authority or other entity.

               "Principal  Market"  means the  principal  exchange  or market on
                -----------------
which the Common Stock is listed or traded.

               "Property"  means  property  and/or assets of all kinds,  whether
                --------
real, personal or mixed, tangible or intangible (including,  without limitation,
all rights relating thereto).

               "Purchase Price" has the meaning specified in Section 1.1 hereof.
                --------------

               "Purchased  Securities" has the meaning set forth in the preamble
                ---------------------
to this Agreement.



                                        5
<PAGE>






               "Registrable Securities" means the Shares and the Warrant Shares,
                ----------------------
any other shares of Common Stock issuable pursuant to the terms of the Warrants,
and any shares of capital  stock issued or issuable  from time to time (with any
adjustments)  in replacement  of, in exchange for or otherwise in respect of the
Shares or the Warrant Shares;  provided,  however, that "Registrable Securities"
shall  not  include  any  such  shares  that  have  been  sold  pursuant  to the
Registration Statement or Rule 144(k).

               "Registration  Statement"  has  the  meaning  set  forth  in  the
                -----------------------
Registration Rights Agreement.

               "Rule  144"  means  Rule 144 under  the  Securities  Act,  or any
                ---------
successor provision.

               "SEC Documents" has the meaning specified in Section 3.4 hereof.
                -------------

               "Securities"  has the meaning  specified  in the preamble to this
                ----------
Agreement.

               "Subsidiary"  means, with respect to any Person,  any corporation
                ----------
or other entity of which at least a majority of the outstanding  shares of stock
or other ownership  interests  having by the terms thereof ordinary voting power
to elect a majority of the board of  directors  (or Persons  performing  similar
functions) of such corporation or entity  (irrespective of whether or not at the
time, in the case of a corporation,  stock of any other class or classes of such
corporation  shall have or might have voting power by reason of the happening of
any  contingency)  is at the time directly or indirectly  owned or controlled by
such Person or one or more of its Subsidiaries or by such Person and one or more
of its Subsidiaries.

               "Trading  Day"  means  any  day on  which  the  Common  Stock  is
                ------------
purchased and sold on the Principal Market.

               "Transaction Documents" means (i) this Agreement, (ii) the Series
                ---------------------
A Warrants, (iii) the Series B Warrants, (iv) the Registration Rights Agreement,
(v) the Indemnity Agreement, and (vi) all other agreements,  documents and other
instruments  executed and delivered by or on behalf of the Company or any of its
officers at the Closing.

     1.3  Other  Definitional  Provisions.  All  definitions  contained  in this
          -------------------------------
Agreement  are equally  applicable to the singular and plural forms of the terms
defined.  The words  "hereof",  "herein"  and  "hereunder"  and words of similar
import referring to this Agreement refer to this Agreement as a whole and not to
any particular provision of this Agreement.

2.   REPRESENTATIONS AND WARRANTIES OF EACH INVESTOR.
     -----------------------------------------------

     Each Investor hereby represents and warrants to the Company and agrees with
the Company that, as of the date of this Agreement and as of the Closing Date:



                                        6
<PAGE>






     2.1  Authorization;  Enforceability.  Such  Investor  is duly  and  validly
          ------------------------------
organized,  validly  existing  and  in  good  standing  under  the  laws  of the
jurisdiction  of its  incorporation  or  organization  as set forth  below  such
Investor's name on the signature page hereof with the requisite  corporate power
and  authority to purchase the Purchased  Securities  and to execute and deliver
this Agreement.  This Agreement and the other transaction  documents to which it
is  a  party  each   constitutes  such  Investor's  valid  and  legally  binding
obligation,  enforceable in accordance with its terms, subject to (i) applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other
similar laws of general application  relating to or affecting the enforcement of
creditors' rights generally and (ii) general principles of equity.

     2.2  Accredited  Investor.  Such Investor is an accredited investor as that
          --------------------
term is defined in Rule 501 of  Regulation  D, and is  acquiring  the  Purchased
Securities  solely for its own account (or for one or more  accounts as to which
it exercises  investment  discretion)  and not with a present view to the public
resale or distribution of all or any part thereof, except pursuant to sales that
are exempt from the registration requirements of the Securities Act and/or sales
registered  under the Securities Act;  provided,  however,  that, in making such
                                       --------   -------
representation,  such Investor  does not agree to hold the Purchased  Securities
for any minimum or specific  term and  reserves  the right to sell,  transfer or
otherwise dispose of the Purchased Securities at any time in accordance with the
provisions  of this  Agreement  and  with  Federal  and  state  securities  laws
applicable to such sale, transfer or disposition.

     2.3  Information.  The Company has provided such Investor with  information
          -----------
regarding the business,  operations and financial condition of the Company,  and
has granted to such  Investor the  opportunity  to ask  questions of and receive
answers from representatives of the Company, its officers, directors,  employees
and agents  concerning  the  Company  and  materials  relating  to the terms and
conditions  of the  purchase  and sale of the  Purchased  Securities  hereunder.
Neither such information nor any other investigation  conducted by such Investor
or its representatives  shall modify,  amend or otherwise affect such Investor's
right to rely on the Company's  representations and warranties contained in this
Agreement.

     2.4  Limitations on Disposition. Such Investor acknowledges that, except as
          --------------------------
provided in the Registration Rights Agreement,  the Securities have not been and
are not being  registered under the Securities Act and may not be transferred or
resold without  registration  under the Securities Act or unless  pursuant to an
exemption therefrom.

     2.5  Legend. Such Investor  understands that the certificates  representing
          ------
the Securities may bear at issuance a restrictive  legend in  substantially  the
following form:

          "The  securities   represented  by  this  certificate  have  not  been
          registered   under  the  Securities  Act  of  1933,  as  amended  (the
          "Securities Act"), or the securities laws of any state, and may not be
          offered or sold unless a registration  statement  under the Securities
          Act and applicable  state  securities laws shall have become effective
          with regard  thereto,  or an  exemption  from  registration  under the
          Securities Act and applicable  state  securities  laws is available in
          connection with such offer or sale."

     Notwithstanding the foregoing, it is agreed that, as long as (A) the resale



                                        7
<PAGE>






or transfer  (including without limitation a pledge) of any of the Securities is
registered pursuant to an effective registration statement,  (B) such Securities
have been sold  pursuant  to Rule 144,  subject  to  receipt  by the  Company of
customary  documentation  in connection  therewith,  or (C) such  Securities are
eligible  for  resale  under  Rule  144(k)  or  any  successor  provision,  such
Securities shall be issued without any legend or other restrictive language and,
with respect to Securities upon which such legend is stamped,  the Company shall
issue new certificates without such legend to the holder upon request.

     2.6  Reliance on Exemptions.  Such Investor understands that the Securities
          ----------------------
are being offered and sold to it in reliance upon specific  exemptions  from the
registration  requirements  of federal  and state  securities  laws and that the
Company  is  relying  on the  truth  and  accuracy  of the  representations  and
warranties  of such  Investor  set forth in this Section 2 in order to determine
the  availability  of such  exemptions  and the  eligibility of such Investor to
acquire the Securities.

     2.7  Non-Affiliate Status; Common Stock Ownership.  Such Investor is not an
          --------------------------------------------
Affiliate  of the  Company  or of any  other  Investor  and  is  not  acting  in
association  or concert with any other  Investor  with regard to its purchase of
Purchased  Securities  or otherwise in respect of the Company.  Such  Investor's
investment in Purchased Securities is not for the purpose of acquiring, directly
or indirectly,  control of, and it has no intent to acquire or exercise  control
of, the Company or to influence the decisions or policies of the Company's Board
of Directors.

     2.8  No Short Position in Company Securities. Neither such Investor nor any
          ---------------------------------------
person trading on its behalf or at its direction has established or maintained a
short position in the Common Stock or any other  securities of the Company as of
the Trading Day immediately preceding the Closing Date.

     2.9  Fees. Such Investor is not obligated to pay any  compensation or other
          ----
fee, cost or related  expenditure  to any  underwriter,  broker,  agent or other
representative in connection with the transactions  contemplated  hereby,  other
than legal fees to its counsel.

3.   REPRESENTATIONS   AND  WARRANTIES  OF  THE  COMPANY.   The  Company  hereby
     ---------------------------------------------------
     represents  and  warrants to each  Investor  and agrees with such  Investor
     that, as of the date of this Agreement and as of the Closing Date:

     3.1  Organization, Good Standing and Qualification. Each of the Company and
          ---------------------------------------------
its Subsidiaries is duly organized,  validly existing and in good standing under
the laws of the  jurisdiction of its  incorporation  or organization and has all
requisite power and authority to carry on its business as now conducted. Each of
the Company and its  Subsidiaries is duly qualified to transact  business and is
in good standing in each jurisdiction in which it conducts business except where
the  failure so to qualify  has not had or would not  reasonably  be expected to
have a Material Adverse Effect.

     3.2  Authorization; Consents. The Company has the requisite corporate power
          -----------------------
and authority to enter into and perform its obligations under this Agreement and
the other Transaction Documents,  including without limitation to issue and sell
the Purchased  Securities to the Investors in accordance with the terms thereof,
to issue the Warrant Shares upon exercise of the Warrants.  All corporate action
on the part of the Company by its officers, directors and stockholders necessary



                                        8
<PAGE>






for the  authorization,  execution and delivery of, and the  performance  by the
Company of its  obligations  under,  this  Agreement  and the other  Transaction
Documents  has been  taken,  and no  further  consent  or  authorization  of the
Company,  its Board of Directors,  stockholders,  any Governmental  Authority or
organization  (other than such approval as may be required  under the Securities
Act and applicable state  securities laws in respect of the Registration  Rights
Agreement),  or any other person or entity is required  (pursuant to any rule of
the NASD or otherwise).  The Company's Board of Directors has  determined,  at a
duly  convened  meeting or  pursuant to a unanimous  written  consent,  that the
issuance  and sale of the  Purchased  Securities,  and the  consummation  of the
transactions  contemplated hereby and the other Transaction Documents (including
without  limitation the issuance of Warrant Shares) are in the best interests of
the Company.

     3.3  Enforcement.  Each  Transaction  Document  has been duly  executed and
          -----------
delivered  by  the  Company  and  constitutes  the  valid  and  legally  binding
obligation of the Company,  enforceable against it in accordance with its terms,
subject  to  (i)  applicable   bankruptcy,   insolvency,   fraudulent  transfer,
moratorium, reorganization or other similar laws of general application relating
to or affecting the enforcement of creditors'  rights generally and (ii) general
principles of equity.

     3.4  SEC Documents;  Agreements;  Financial Statements;  Other Information.
          ---------------------------------------------------------------------
Except as  described  on  Schedule  3.4  hereto,  the Company has filed with the
                          -------------
Commission all reports, schedules,  registration statements and definitive proxy
statements that the Company was required to file with the Commission on or after
December 31, 2002 (collectively,  the "SEC Documents"). The Company is not aware
                                       -------------
of any  event  occurring  on or  prior  to the  Closing  Date  (other  than  the
transactions  effected hereby) that would require the filing of, or with respect
to which the Company  intends to file,  a Form 8-K after the  Closing.  Each SEC
Document, as of the date of the filing thereof with the Commission,  complied in
all material  respects with the  requirements  of the Securities Act or Exchange
Act, as applicable, and the rules and regulations promulgated thereunder and, as
of the date of such filing (or if amended or superseded by a filing prior to the
date of this  Agreement,  then on the date of such  filing),  such SEC  Document
(including  all exhibits and  schedules  thereto and documents  incorporated  by
reference  therein) did not contain an untrue statement of material fact or omit
to state a material fact required to be stated  therein or necessary to make the
statements  therein,  in light of the circumstances  under which they were made,
not  misleading.  All  documents  required  to be filed as  exhibits  to the SEC
Documents have been filed as required.  Except as set forth in the SEC Documents
or any  schedule or exhibit  attached  hereto,  the Company has no  liabilities,
contingent or otherwise,  other than liabilities incurred in the ordinary course
of business which, under GAAP, are not required to be reflected in the financial
statements  included  in the SEC  Documents  and which,  individually  or in the
aggregate,  are not material to the consolidated business or financial condition
of the Company and its Subsidiaries  taken as a whole. The financial  statements
included  in the SEC  Documents  have  been  prepared  in  accordance  with GAAP
consistently applied at the times and during the periods involved (except (i) as
may be otherwise indicated in such financial statements or the notes thereto, or
(ii) in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary  statements)  and fairly present in all
material respects the financial  position of the Company as of the dates thereof
and the  results of its  operations  and cash flows for the  periods  then ended
(subject, in the case of unaudited statements, to normal year-end adjustments).

     3.5  Capitalization; Debt Schedule. The capitalization of the Company as of
          -----------------------------



                                        9
<PAGE>






the date hereof,  including its authorized  capital stock,  the number of shares
issued and outstanding,  the number of shares issuable and reserved for issuance
pursuant to the  Company's  stock  option  plans and  agreements,  the number of
shares issuable and reserved for issuance pursuant to securities (other than the
Purchased  Securities)  exercisable for, or convertible into or exchangeable for
any shares of Common Stock and the number of shares initially to be reserved for
issuance upon exercise of the Warrants is set forth on Schedule 3.5 hereto.  All
                                                       ------------
issued and outstanding  shares of capital stock of the Company have been validly
issued,  fully paid and  non-assessable.  No shares of the capital  stock of the
Company are subject to preemptive rights or any other similar rights of security
holders of the Company or any Liens created by or through the Company. Except as
disclosed on Schedule  3.5, or as  contemplated  herein,  as of the date of this
             -------------
Agreement and as of the date of the Closing,  there are no outstanding  options,
warrants,  scrip,  rights to subscribe to, calls or commitments of any character
whatsoever  relating to, or securities or rights convertible into or exercisable
or  exchangeable  for, any shares of capital  stock of the Company or any of its
Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is
or may become bound to issue  additional  shares of capital stock of the Company
or any of its Subsidiaries (whether pursuant to anti-dilution,  "reset" or other
similar provisions). Except as described on Schedule 3.5 hereto, the Company has
                                            ------------
no material Debt outstanding as of the date hereof.

     3.6  Due  Authorization;  Valid  Issuance.  The Shares and the Warrants are
          ------------------------------------
duly  authorized  and, when issued,  sold and  delivered in accordance  with the
terms hereof,  will be duly and validly issued,  fully paid and  non-assessable,
free and clear of any Liens imposed by or through the Company and,  assuming the
accuracy of each Investor's  representations in this Agreement,  will be issued,
sold  and  delivered  in  compliance  with  all  applicable  Federal  and  state
securities  laws.  The  Warrant  Shares are duly  authorized  and  reserved  for
issuance and, when issued in accordance with the terms of the Warrants,  will be
duly and validly issued,  fully paid and  non-assessable,  free and clear of any
Liens imposed by or through the Company.

     3.7  No Conflict with Other Instruments. Neither the Company nor any of its
          ----------------------------------
Subsidiaries  is in violation of any  provisions  of its charter,  bylaws or any
other governing  document or in default (and no event has occurred  which,  with
notice or lapse of time or both, would constitute a default) under any provision
of any  instrument  or  contract to which it is a party or by which it or any of
its  Property is bound,  or in violation  of any  provision of any  Governmental
Requirement  applicable  to it,  except for  violations  of any  provision  of a
Governmental Requirement that has not had or would not reasonably be expected to
have a Material  Adverse  Effect  (any such  violation  or  default,  a "Current
Violation").  The execution,  delivery and performance of this Agreement and the
other   Transaction   Documents,   and  the  consummation  of  the  transactions
contemplated hereby and thereby (including without  limitation,  the issuance of
the Purchased Securities and the reservation and issuance of the Warrant Shares)
will not result in a Current  Violation  or result in the  creation  of any Lien
upon any assets of the Company or of any of its  Subsidiaries  or the triggering
of any preemptive or anti-dilution rights (including without limitation pursuant
to any "reset" or similar provisions) or rights of first refusal or first offer,
or any other  rights  that would  allow or permit the  holders of the  Company's
securities  or  other  Persons  to  purchase  shares  of  Common  Stock or other
securities  of the  Company  (whether  pursuant  to a  shareholder  rights  plan
provision or otherwise).

     3.8  Financial Condition; Taxes; Litigation.
          --------------------------------------



                                       10
<PAGE>






          3.8.1  The Company's financial condition is, in all material respects,
as described  in the  Disclosure  Documents,  except for changes in the ordinary
course  of  business  and  normal  year-end  adjustments  that are  not,  in the
aggregate,   materially  adverse  to  the  consolidated  business  or  financial
condition of the Company and its Subsidiaries  taken as a whole.  There has been
no  (i)  material  adverse  change  to  the  Company's   business,   operations,
properties,  financial  condition,  prospects or results of operations since the
date of the Company's most recent audited financial  statements contained in the
Disclosure Documents or (ii) change by the Company in its accounting principles,
policies and methods except as required by changes in GAAP.

          3.8.2  Each of the Company and its  Subsidiaries  (i) has  prepared in
good faith and duly and timely filed all tax returns  required to be filed by it
and such returns are complete  and  accurate in all material  respects  (ii) has
paid all  taxes  required  to have been paid by it,  except  for taxes  which it
reasonably  disputes in good faith or the failure of which to pay has not had or
would not reasonably be expected to have a Material  Adverse Effect,  and has no
liability  with  respect  to  accrued  taxes in excess of the  amounts  that are
described  as accrued in the  financial  statements  included in the  Disclosure
Documents.

          3.8.3  Neither the Company nor any of its  Subsidiaries is the subject
of any pending or, to the Company's knowledge, threatened inquiry, investigation
or  administrative  or legal  proceeding by the Internal  Revenue  Service,  the
taxing authorities of any state or local jurisdiction, the Commission, the NASD,
any state securities commission or other Governmental Authority.

          3.8.4  Except as  described  in Schedule  3.8.4,  there is no material
                                          ---------------
claim,  litigation  or  administrative  proceeding  pending or, to the Company's
knowledge,  threatened  or  contemplated,  against  the  Company  or  any of its
Subsidiaries, or against any officer, director or employee of the Company or any
such Subsidiary in connection with such person's employment  therewith.  Neither
the  Company  nor  any of its  Subsidiaries  is a  party  to or  subject  to the
provisions of, any order, writ,  injunction,  judgment or decree of any court or
Governmental  Authority which has had or would  reasonably be expected to have a
Material Adverse Effect.

     3.9  Form SB-2.  The  Company  is  eligible  to  register  the  Registrable
          ---------
Securities for resale by each Investor on a registration  statement on Form SB-2
under the Securities  Act. To the Company's  knowledge,  there exist no facts or
circumstances (including without limitation any required approvals or waivers of
any  circumstances  that may delay or  prevent  the  obtaining  of  accountant's
consents) that could reasonably be expected to prohibit or delay the preparation
and filing of such registration statement.

     3.10  Acknowledgement of  Dilution.   The  Company  acknowledges  that  the
           ----------------------------
issuance of the  Warrant  Shares upon  exercise  of the  Warrants  may 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  Warrant  Shares upon exercise of the Warrants in
accordance with the terms thereof is  unconditional  regardless of the effect of
any such dilution.

     3.11  Intellectual Property.  The Company and its Subsidiaries each owns or
           ---------------------



                                       11
<PAGE>






possesses,  licenses or can acquire or make use of, without undue  expense,  all
Intellectual  Property that is necessary or appropriate for the operation of its
businesses as presently  conducted and as proposed to be conducted,  without any
known conflict with the rights of others.  The  consummation of the transactions
contemplated  by this  Agreement and the other  Transaction  Documents  will not
materially alter or impair, individually or in the aggregate, any of such rights
of the Company. To the Company's knowledge,  (i) none of its current products or
services  infringes upon any Intellectual  Property of any other Person,  and no
claim or litigation  is pending or, to the knowledge of the Company,  threatened
against the Company contesting its right to sell or otherwise use any product or
material  or service  which has had or would  reasonably  be  expected to have a
Material  Adverse  Effect and (ii) the use by the  Company  of any  Intellectual
Property  does not infringe  the rights of any third party to such  Intellectual
Property.  There is no violation by the Company with respect to any Intellectual
Property  owned  or  used  by the  Company  and  the  Company's  rights  to such
Intellectual  Property are valid and enforceable  and no  registration  relating
thereto  has  lapsed,  expired or  terminated  or is the subject of any claim or
proceeding that could result in any such lapse,  expiration or termination.  The
Company and its Subsidiaries each has complied in all material respects with its
obligations  pursuant to any agreement relating to Intellectual  Property rights
that are the subject of licenses granted by third parties.

     3.12  Registration Rights.   Except as  described on  Schedule 3.12 hereto,
           -------------------
the  Company  has not  granted  or agreed to grant to any  person or entity  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 in full prior to the date hereof.

     3.13  Fees. Except as described on Schedule 3.13 hereto, the Company is not
           ----                         -------------
obligated to pay any  compensation or other fee, cost or related  expenditure to
any underwriter,  broker,  agent or other  representative in connection with the
transactions  contemplated  hereby. The Company will indemnify and hold harmless
such Investor  from and against any claim by any person or entity  alleging that
such  Investor is obligated to pay any such  compensation,  fee, cost or related
expenditure in connection with the transactions contemplated hereby.

     3.14  Foreign  Corrupt  Practices.  Neither  the  Company, nor  any  of its
           ---------------------------
Subsidiaries nor any director,  officer,  agent, employee or other person acting
on behalf of the Company or any Subsidiary, has (i) used any corporate funds for
any  unlawful  contribution,  gift,  entertainment  or other  unlawful  expenses
relating  to  political  activity,  (ii) made any  direct or  indirect  unlawful
payment to any foreign or domestic  government  official or employee  (including
without limitation any bribe,  rebate,  payoff,  influence payment,  kickback or
other unlawful payment),  or (iii) violated any provision of the Foreign Corrupt
Practices Act of 1977, as amended.

     3.15  Employees.  Each of the Company's  executive  officers (as defined in
           ---------
Rule 501(f) of the Securities Act) (each, a "Key Employee") is currently serving
                                             ------------
in the capacity  indicated in Schedule 3.15 hereto. The Company has no knowledge
                              -------------
of any fact or circumstance  (including  without limitation (i) the terms of any
agreement to which such person is a party or any litigation in which such person
is or may become  involved and (ii) any illness or medical  condition that could
reasonably be expected to result in the disability or incapacity of such person)
that would limit or prevent any such person from  serving in such  capacity on a
full-time  basis in the foreseeable  future,  or of any intention on the part of



                                       12
<PAGE>






any such person to limit or terminate his or her employment with the Company. No
Key Employee has borrowed money pursuant to a currently outstanding loan that is
secured by Common Stock or any right or option to receive Common Stock. There is
no strike,  labor dispute or union  organization  activities  pending or, to the
knowledge of the Company,  threatened between it and its employees.  None of the
Company's  employees  belong to any union or  collective  bargaining  unit.  The
Company has complied in all material  respects with all  applicable  federal and
state equal opportunity and other laws related to employment.

     3.16  Environment.  The Company and its  Subsidiaries  have no  liabilities
           -----------
under any Environmental Law, nor do any factors exist that are reasonably likely
to give rise to any such  liability,  affecting any of the  properties  owned or
leased by the Company or any of its  Subsidiaries  that,  individually or in the
aggregate,  have had or would  reasonably be expected to have a Material Adverse
Effect.  Neither  the  Company  nor any of the  Subsidiaries  has  violated  any
Environmental Law applicable to it now or previously in effect,  other than such
violations or infringements that, individually or in the aggregate, have not had
and would not reasonably be expected to have a Material Adverse Effect.

     3.17  ERISA.  Except as described  on Schedule  3.17,  the Company does not
           -----                           --------------
maintain or contribute to, or have any obligation  under,  any Pension Plan. The
Company is in compliance in all material respects with the presently  applicable
provisions  of ERISA and the United  States  Internal  Revenue Code of 1986,  as
amended,  except for matters that,  individually  or in the aggregate,  have not
had, and would not reasonably be expected to have, a Material Adverse Effect.

     3.18  Disclosure. No written statement, information, report, representation
           ----------
or  warranty  made by the  Company in this  Agreement  or any other  Transaction
Document  or  furnished  to such  Investor  by or on  behalf of the  Company  in
connection  with the  Transaction  Documents or such  Investor's  due  diligence
investigation of the Company contains any untrue statement of a material fact or
omits to state any  material  fact  necessary to make the  statements  herein or
therein,  in light of the  circumstances  in which  made,  not  misleading.  The
Company has not disclosed to such Investor any event,  circumstance or fact that
would  constitute  material  non-public  information  as of  the  date  of  this
Agreement or the Closing  Date.  Following the issuance of the press release and
Form 8-K in  accordance  with Section  4.1(c)  hereof,  such  Investor  will not
possess any material non-public  information concerning the Company. The Company
acknowledges   that  such   Investor   is   relying   on  the   representations,
acknowledgements  and  agreements  made by the Company in this  Section  3.18 in
making trading and other decisions concerning the Company's securities.

     3.19  Insurance.  Except as described in Schedule 3.19 hereto,  the Company
           ---------                          -------------
maintains insurance for itself and its Subsidiaries in such amounts and covering
such  losses  and risks as the  Company  believes  to be  reasonably  prudent in
relation  to the  businesses  in which  the  Company  and its  Subsidiaries  are
engaged.  No notice of  cancellation  has been received for any of such policies
and the Company is in compliance  with all of the terms and conditions  thereof.
The  Company  has no  reason  to  believe  that it will not be able to renew its
existing  insurance  coverage  as and when such  coverage  expires  or to obtain
similar  coverage  from  similar  insurers as may be  necessary  to continue its
business without a significant increase in cost. Without limiting the generality
of the foregoing, the Company maintains Director's and Officer's insurance in an
amount not less than $5 million for each covered occurrence.




                                       13
<PAGE>






     3.20  Property.  The Company and its Subsidiaries  have good and marketable
           --------
title in fee simple to all of its real property and good and marketable title to
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  Permitted  Liens.  Any  Property  held under  lease by the  Company and its
Subsidiaries is held by them under valid, subsisting and enforceable leases with
such  exceptions as are not material and do not  interfere  with the use made or
proposed  to be made of  such  Property  by the  Company  and its  Subsidiaries.
Neither the Company nor any of its Subsidiaries own any real Property.

     3.21  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   other  than  where  the  failure  to  possess  such   certificates,
authorizations  or permits,  individually  or in the aggregate,  has not had and
would not reasonably be expected to have a Material Adverse Effect.  Neither the
Company nor any such  Subsidiary  has received  any notice or  otherwise  become
aware of any proceedings, inquiries or investigations relating to the revocation
or modification of any such certificate, authorization or permit.

     3.22  Exchange Act Registration.  The Company's  Common Stock is registered
           -------------------------
pursuant  to Section  12(g) of the  Exchange  Act and the  Company  has taken no
action designed to, or which, to the knowledge of the Company, is likely to have
the effect of,  terminating  the  registration  of the  Common  Stock  under the
Exchange Act.

     3.23  Investment Company Status.  The Company is not, and immediately after
           -------------------------
receipt of payment for the Purchased Securities issued under this Agreement will
not be, an  "investment  company" or an entity  "controlled"  by an  "investment
             -------------------                 ----------           ----------
company"  within the meaning of the  Investment  Company Act of 1940, as amended
-------
(the  "Investment  Company Act"),  and shall conduct its business in a manner so
       -----------------------
that it will not become subject to the Investment Company Act.

     3.24  Transfer Taxes.  No stock  transfer or other taxes (other than income
           --------------
taxes) are required to be paid in  connection  with the issuance and sale of any
of the  Securities,  other than such taxes for which the Company has established
appropriate reserves and intends to pay in full on or before the Closing.

     3.25  Internal Controls  and  Procedures.  The Company  maintains  internal
           ----------------------------------
accounting  controls,  policies and procedures and such books and records as are
reasonably designed to provide reasonable assurance that (i) all transactions to
which the Company or any  Subsidiary is a party or by which its  properties  are
bound  are  effected  by a duly  authorized  employee  or agent of the  Company,
supervised  by and  acting  within  the scope of the  authority  granted  by the
Company's  senior  management;  (ii) the recorded  accounting  of the  Company's
consolidated  assets is compared with existing assets at regular intervals;  and
(iii) all  transactions to which the Company or any Subsidiary is a party, or by
which its properties are bound,  are recorded (and such records are  maintained)
in accordance with all material Government  Requirements and as may be necessary
or  appropriate  to ensure  that the  financial  statements  of the  Company are
prepared in accordance with GAAP.



                                       14
<PAGE>






     3.26  Embargoed Person.  None of the funds or other  assets of the  Company
           ----------------
shall  constitute  property  of, or shall be  beneficially  owned,  directly  or
indirectly, by any person subject to trade restrictions under United States law,
including,  but not limited to, the International Emergency Economic Powers Act,
50 U.S.C. ss. 1701 et seq., The Trading with the Enemy Act, 50 U.S.C.  App. 1 et
seq., and any Executive Orders or regulations  promulgated under any such United
States laws (each, an "Embargoed Person"),  with the result that the investments
                       ----------------
evidenced by the Purchased  Securities  are or would be in violation of law; (b)
no  Embargoed  Person shall have any  interest of any nature  whatsoever  in the
Company  with  the  result  that  the  investments  evidenced  by the  Purchased
Securities are or would be in violation of law; and (c) none of the funds of the
Company  shall be derived  from any unlawful  activity  with the result that the
investments  evidenced by the Purchased  Securities are or would be in violation
of law.

     3.27  No Other Agreements.  The  Company has not,  directly or  indirectly,
           -------------------
entered into any agreement with or granted any right to any Investor relating to
the terms or conditions of the  transactions  contemplated  by this Agreement or
the  other  Transaction  Documents,   except  as  expressly  set  forth  in  the
Transaction Documents.

4.   COVENANTS OF THE COMPANY AND EACH INVESTOR.
     ------------------------------------------

     4.1  The Company  agrees with each  Investor  that it will,  following  the
Closing:

          (a)  file a  Form D with  respect  to  the  Securities  issued  at the
Closing as and when required under Regulation D and to provide a copy thereof to
such Investor promptly after such filing;

          (b)  take such action as the Company  reasonably  determines  upon the
advice of counsel is necessary to qualify the Purchased Securities issued at the
Closing for sale and resale under  applicable state or "blue-sky" laws or obtain
an exemption  therefrom,  and shall provide  evidence of any such action to such
Investor at such Investor's request; and

          (c)  (i) on or prior to 9:30 a.m.  (eastern  time) on the Business Day
immediately following the date on which this Agreement is executed and delivered
by the Company,  issue a press  release  disclosing  the material  terms of this
Agreement and the other Transaction Documents and the transactions  contemplated
hereby and  thereby  and (ii) on the  Business  Day  immediately  following  the
Closing Date,  file with the  Commission a Current Report on Form 8-K disclosing
the material terms of this Agreement and the other Transaction Documents and the
transactions  contemplated  hereby and thereby and  including  as exhibits  this
Agreement and the other Transaction Documents; provided, however, that Satellite
Strategic Finance  Associates,  LLC and each Investor named therein shall have a
reasonable  opportunity  to review and comment on any such press release or Form
8-K prior to the  issuance or filing  thereof.  Thereafter,  the  Company  shall
timely file any filings and notices required by the Commission or applicable law
with respect to the transactions contemplated hereby.

     4.2  The  Company  agrees  that it  will,  as long as any  Investor  or any
          Affiliate of such Investor beneficially owns any Securities:



                                       15
<PAGE>






          (a)  maintain its corporate existence in good standing;

          (b)  maintain,  keep and preserve all of its  Properties  necessary in
the proper conduct of its businesses in good repair, working order and condition
(ordinary wear and tear excepted) and make all necessary  repairs,  renewals and
replacements and improvements  thereto,  except where the failure to do so would
not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect;

          (c)  pay or  discharge  before  becoming  delinquent  (a)  all  taxes,
levies,  assessments  and  governmental  charges  imposed on it or its income or
profits or any of its Property and (b) all lawful claims for labor, material and
supplies, which, if unpaid, might become a Lien upon any of its Property, except
where  the  failure  to  do  so  would  not  reasonably  be  expected  to  have,
individually or in the aggregate, a Material Adverse Effect; provided,  however,
                                                             --------   -------
that the  Company  shall not be  required  to pay or  discharge  any tax,  levy,
assessment or  governmental  charge,  or claim for labor,  material or supplies,
whose  amount,  applicability  or validity is being  contested  in good faith by
appropriate proceedings being diligently pursued and for which adequate reserves
have been established under GAAP;

          (d)  comply  with  all  Governmental  Requirements  applicable  to the
operation of its business,  except for instances of noncompliance that would not
reasonably be expected to have,  individually  or in the  aggregate,  a Material
Adverse Effect;

          (e)  comply with all agreements,  documents and instruments binding on
it or affecting its Properties or business,  including,  without limitation, all
Material  Contracts,  except  for  instances  of  noncompliance  that  would not
reasonably be expected to have,  individually  or in the  aggregate,  a Material
Adverse Effect;

          (f)  provide such Investor  with copies of all  materials  sent to its
stockholders,  in  each  such  case  at the  same  time  as  delivered  to  such
stockholders;

          (g)  timely file with the Commission all reports  required to be filed
pursuant to the  Exchange  Act and  refrain  from  terminating  its status as an
issuer  required by the  Exchange  Act to file  reports  thereunder  even if the
Exchange  Act  or  the  rules  or  regulations   thereunder  would  permit  such
termination;

          (h)  until the Effective Date of the Registration Statement,  restrict
Key Employees from selling shares of Common Stock other than as may be agreed in
writing by the  Company  and  Satellite  Strategic  Finance  Associates,  LLC in
connection with any 10b-5(1) trading plans; and

          (i)  keep all of the Insurance Policies in full force and effect.

     4.3  Reservation of Common Stock.  The Company shall  authorize and reserve
          ---------------------------



                                       16
<PAGE>






for issuance to the  Investors,  free from any  preemptive  rights,  a number of
shares of Common Stock (the "Reserved Amount") that, on the Closing Date, is not
                             ---------------
less than the sum of (A) the aggregate  number of Shares issued to the Investors
at the Closing plus (B) the  aggregate  number of Warrant  Shares  issuable upon
               ----
exercise of the Series A Warrants plus (C) one hundred and fifty percent  (150%)
                                  ----
of the aggregate number of Warrant Shares issuable upon exercise of the Series B
Warrants  (without regard to any limitation or restriction on such exercise that
may be set  forth in the  Series B  Warrants).  If,  on any date  following  the
Closing  Date,  the  Reserved  Amount is less than the sum of (i) the  aggregate
number of Warrant  Shares  issuable  under the  Series A Warrants  plus (ii) one
                                                                   ----
hundred and twenty five percent (125%) of the aggregate number of Warrant Shares
issuable  upon  exercise  of  the  Series  B  Warrants  (without  regard  to any
limitation  or  restriction  on  such  exercise  that  may be set  forth  in the
Warrants),  the Company shall take action (including  without limitation seeking
stockholder  approval for the  authorization or reservation of additional shares
of Common  Stock) as soon as  practicable  (but in no event later than the fifth
(5th) Business Day or, in the event that stockholder  approval is required,  the
forty-fifth  (45th) day following such date) to increase the Reserved  Amount to
not less than the sum of (x) the number of Warrant Shares issuable upon exercise
of the Series A Warrants  plus (y) one hundred and fifty  percent  (150%) of the
                          ----
number of Warrant  Shares  issuable  under the Series B  Warrants.  The  initial
Reserved  Amount shall be allocated  pro rata among the  Investors  based on the
number of Shares  issued to each  Investor at the Closing.  Each increase in the
Reserved  Amount shall be allocated  pro rata among the  Investors  based on the
number of  Outstanding  Registrable  Securities.  In the event that an  Investor
shall sell or otherwise transfer any of such Investor's Registrable  Securities,
each  transferee  shall be  allocated  a pro rata  portion of such  transferor's
Reserved Amount. Any portion of the Reserved Amount allocated to any Investor or
other  Person  which  no  longer  holds  any  Registrable  Securities  shall  be
reallocated  to  the  remaining  Investors  pro  rata  based  on the  number  of
Outstanding Registrable Securities.

     4.4  Use of Proceeds.  The Company  shall use the proceeds from the sale of
          ---------------
the Purchased  Securities for general  corporate  purposes only, in the ordinary
course of its business and  consistent  with past practice;  provided,  however,
                                                             --------   -------
that the Company  shall not use such  proceeds  (i) to pay down,  repurchase  or
redeem any notes or securities issued by the Company or any Subsidiary,  (ii) to
pay any dividend or make any  distribution on any such  securities,  or (iii) to
repay any loan made to or  incurred  by any Key  Employee  or  Affiliate  of the
Company.

     4.5  Use of Investor Name. Except as may be required by applicable law, the
          --------------------
Company shall not use,  directly or indirectly,  any Investor's name or the name
of any of its affiliates in any  advertisement,  announcement,  press release or
other similar  communication unless it has received the prior written consent of
such  Investor  for the specific use  contemplated  or as otherwise  required by
applicable law or regulation.

     4.6  Company's  Instructions  to Transfer Agent. On or prior to the Closing
          ------------------------------------------
Date, the Company shall execute and deliver irrevocable written  instructions to
the transfer agent for its Common Stock (the "Transfer Agent"), and provide each
                                              --------------
Investor  with a  copy  thereof,  directing  the  Transfer  Agent  (i) to  issue
certificates  representing Warrant Shares upon exercise of the Warrants,  in the
name and amount specified by such Investor and (ii) to deliver such certificates
to such Investor no later than the close of business on the third (3rd) Business
Day following the related  Exercise Date (as defined in the Series A Warrants or
Series B Warrants,  as the case may be).  Warrant  Shares  shall not contain any



                                       17
<PAGE>






restrictive legend except as may be required by the terms of this Agreement. The
Company shall instruct the transfer  agent that, in lieu of delivering  physical
certificates representing shares of Common Stock to an Investor upon exercise of
a  Warrant,  and as long as (x)  the  Transfer  Agent  is a  participant  in the
Depository Trust Company ("DTC") Fast Automated Securities Transfer program, (y)
                           ---
such  Investor has not  informed the Company that it wishes to receive  physical
certificates  therefor,  and (z) no legend is required to appear on any physical
certificate  when  issued,  the  transfer  agent may effect  delivery of Warrant
Shares by crediting  the account of such  Investor or its nominee at DTC for the
number of shares for which delivery is required  hereunder within the time frame
specified  above for delivery of  certificates.  The Company  represents  to and
agrees with each Investor that it will not give any  instruction to the Transfer
Agent that will conflict with the foregoing  instruction  or otherwise  restrict
such  Investor's  right to exercise a Warrant or to receive  Warrant Shares upon
such exercise.  In the event that the Company's  relationship  with the Transfer
Agent  should be  terminated  for any  reason,  the  Company  shall use its best
efforts  to cause  the  Transfer  Agent to  continue  acting as  transfer  agent
pursuant to the terms hereof until such time that a successor  transfer agent is
appointed by the Company and receives the instructions described above.

     4.7  No Adverse  Action.  The Company and its  Subsidiaries  shall refrain,
          ------------------
while any  Registrable  Securities  are  outstanding,  from taking any action or
entering into any arrangement which in any way materially and adversely violates
the terms of this Agreement or the Warrants.

     4.8  Limitations on Disposition.  No Investor shall sell, transfer,  assign
          --------------------------
or dispose of any Securities, unless:

          (a)  there is then in effect an effective registration statement under
the Securities Act covering such proposed  disposition  and such  disposition is
made in accordance with such registration statement; or

          (b)  such  Investor  has  notified  the Company in writing of any such
disposition  and  furnished  the Company with an opinion of counsel,  reasonably
satisfactory to the Company, that such disposition will not require registration
of such Securities  under the Securities Act;  provided,  however,  that no such
                                               --------   -------
opinion of counsel  will be required  (A) if the sale,  transfer  or  assignment
complies with federal and state  securities  laws and is made to an Affiliate of
such Investor which is also an "accredited  investor" as that term is defined in
Rule 501 of  Regulation  D, (B) if the  sale,  transfer  or  assignment  is made
pursuant  to Rule 144 and such  Investor  provides  the  Company  with  evidence
reasonably  satisfactory to the Company that the proposed transaction  satisfies
the  requirements  of Rule 144 or (C) in  connection  with a bona fide pledge or
hypothecation of any Securities under a margin  arrangement with a broker-dealer
or other financial institution.

     4.9  Disclosure of Information.  The Company agrees that it will not at any
          -------------------------
time disclose  material  non-public  information  to any Investor  without first
receiving such Investor's written consent to such disclosure.

     4.10  Put Option.  If the Company fails to file a Form 10-KSB that conforms
           ----------
with the  requirements  of the  Commission and the Exchange Act on or prior to 4
pm, eastern time, on April 15, 2004 (such failure,  a "10-KSB Filing  Default"),
                                                       ----------------------
each Investor  shall have the right (the "Put Option") to require the Company to
                                          ----------



                                       18
<PAGE>






repurchase  all or any of its  Securities  at a put price equal to the  Purchase
Price paid by such Investor for such Securities  (the "Put Price").  If a 10-KSB
                                                       ---------
Filing Default occurs,  the Put Option shall be exercisable  from April 16, 2004
until 8 pm,  eastern  time,  on May 14,  2004  (the "Put  Period").  In order to
                                                     -----------
exercise  the Put  Option,  an  Investor  must  deliver  written  notice (a "Put
                                                                             ---
Notice")  to  the  Company   specifying  the  number  of  Securities  (the  "Put
------                                                                       ---
Securities")  that  it is  electing  to  put  to  the  Company  and  the  wiring
----------
instructions for the payment of the Put Price. If an Investor does not deliver a
Put Notice prior to the  expiration of the Put Period,  such  Investor  shall be
deemed to have  waived its Put  Option.  Upon  receipt  of a Put Notice  from an
Investor,  the Company  shall pay such Investor the  applicable  Put Price on or
prior to the  later of (i) the date  that is two (2)  Business  Days  after  the
Company  receives  such Put  Notice  and (ii)  the date on which  such  Investor
delivers the Securities to the Company, provided that if such Investor elects to
put less  than all of is  Securities,  the  Company  shall  promptly  issue  new
Securities  with terms  identical in all respects to the Put Securities  (except
such new Securities  shall  represent the portion of the Securities  retained by
such Investor). Any amount of the Put Price that is not paid when due shall bear
interest at the lower of fifteen percent (15%) and the maximum rate permitted by
applicable law.

5.   CONDITIONS TO CLOSING.
     ---------------------

     5.1  Conditions to Investors'  Obligations at the Closing.  Each Investor's
          ----------------------------------------------------
obligations to effect the Closing,  including without  limitation its obligation
to purchase the Purchased  Securities at the Closing,  are conditioned  upon the
fulfillment or waiver by such Investor of each of the following events as of the
Closing Date:

          5.1.1     the  representations and warranties of the Company set forth
                    in this  Agreement  and in the other  Transaction  Documents
                    shall be true and  correct in all  material  respects  as of
                    such date as if made on such date (except that to the extent
                    that  any  such  representation  or  warranty  relates  to a
                    particular  date,  in  which  case  such  representation  or
                    warranty  shall be true and  correct in all  respects  as of
                    that particular date);

          5.1.2     the Company  shall have  complied  with or  performed in all
                    material  respects all of the  agreements,  obligations  and
                    conditions  set  forth in this  Agreement  and in the  other
                    Transaction  Documents that are required to be complied with
                    or performed by the Company on or before the Closing;

          5.1.3     the  Closing  Date  shall  occur on a date that is not later
                    than April 1, 2004;

          5.1.4     the  Company  shall  have   delivered  to  such  Investor  a
                    certificate, signed by the Chief Executive Officer and Chief
                    Financial  Officer  of  the  Company,  certifying  that  the
                    conditions   specified  in  this  paragraph  5.1  have  been
                    fulfilled as of the Closing,  it being  understood that such
                    Investor  may rely on such  certificate  as though it were a
                    representation and warranty of the Company made herein;




                                       19
<PAGE>






          5.1.5     the  Company  shall  have  delivered  to  such  Investor  an
                    opinion of counsel for the  Company,  dated as of such date,
                    in substantially the form set forth on Exhibit 5.1.5 hereto;

          5.1.6     the  Company  shall have  delivered  to such  Investor  duly
                    executed  certificates  representing  the  Shares,  Series A
                    Warrant  and  Series  B  Warrant  being  purchased  by  such
                    Investor;

          5.1.7     the  Company  shall  have  executed  and  delivered  to such
                    Investor the Registration Rights Agreement;

          5.1.8     the Company shall have  delivered to such Investor a copy of
                    the Insurance Binder,  and such Investor shall be reasonably
                    satisfied  that the  Insurance  Policies  shall be in effect
                    immediately upon payment of the premiums thereof at Closing;

          5.1.9     there  shall  have been no  material  adverse  change in the
                    Company's consolidated business or financial condition since
                    the date of the Company's  most recent  unaudited  financial
                    statements contained in the Disclosure Documents;

          5.1.10    there shall be no injunction,  restraining order or decree
                    of any  nature  of any  court  or  Government  Authority  of
                    competent  jurisdiction  that is in effect that restrains or
                    prohibits the consummation of the transactions  contemplated
                    hereby or by the other Transaction Documents; and

          5.1.11    the aggregate  Purchase Price to be paid at the Closing by
                    the Investors for the Purchased Securities shall be at least
                    $5,500,000.

     5.2  Conditions  to Company's  Obligations  at the Closing.  The  Company's
          -----------------------------------------------------
obligations to effect the Closing are conditioned upon the fulfillment or waiver
by the Company of each of the following events as of the Closing Date:

          5.2.1     the representations and warranties of each Investor shall be
                    true and correct in all material respects as of such date as
                    if made on such date  (except  that to the  extent  that any
                    such  representation  or  warranty  relates to a  particular
                    date, in which case such representation or warranty shall be
                    true  and  correct  in all  respects  as of that  particular
                    date);

          5.2.2     each  Investor  shall have complied with or performed all of
                    the agreements, obligations and conditions set forth in this
                    Agreement that are required to be complied with or performed
                    by such Investor on or before the Closing;



                                       20
<PAGE>






          5.2.3     there shall be no  injunction,  restraining  order or decree
                    of any  nature  of any  court  or  Government  Authority  of
                    competent  jurisdiction  that is in effect that restrains or
                    prohibits the consummation of the transactions  contemplated
                    hereby or by the other Transaction Documents;

          5.2.4     each Investor shall have executed each Transaction  Document
                    to  which  it is a  party  and  delivered  the  same  to the
                    Company; and

          5.2.5     each  Investor  shall  have  delivered  to the  Company  the
                    Purchase Price for the Purchased  Securities being purchased
                    by it  at  the  Closing  by  wire  transfer  of  immediately
                    available funds.

6.   MISCELLANEOUS.
     -------------

     6.1  Survival; Severability. The representations, warranties, covenants and
          ----------------------
indemnities  made by the parties herein and in the other  Transaction  Documents
shall survive the Closing  notwithstanding any due diligence  investigation made
by or on behalf of the party  seeking  to rely  thereon.  In the event  that any
provision  of this  Agreement  becomes or is  declared  by a court of  competent
jurisdiction to be illegal, unenforceable or void, this Agreement shall continue
in full force and effect without said provision;  provided that in such case the
parties  shall  negotiate  in good faith to replace  such  provision  with a new
provision  which is not  illegal,  unenforceable  or  void,  as long as such new
provision does not materially  change the economic benefits of this Agreement to
the parties.

     6.2  Successors  and Assigns.  The terms and  conditions of this  Agreement
          -----------------------
shall inure to the benefit of and be binding upon the respective  successors and
permitted assigns of the parties. Nothing in this Agreement, express or implied,
is intended  to confer  upon any party  other than the  parties  hereto or their
respective successors and permitted assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement,  except as expressly  provided
in this Agreement. The Investor may assign its rights and obligations hereunder,
in connection  with any private sale or transfer of the Purchased  Securities in
accordance with the terms hereof,  as long as, as a condition  precedent to such
transfer, the transferee executes an acknowledgment  agreeing to be bound by the
applicable provisions of this Agreement, in which case the term "Investor" shall
be deemed to refer to such transferee as though such transferee were an original
signatory  hereto.  The Company may not assign its rights or  obligations  under
this Agreement.

     6.3  No Reliance. Each party acknowledges that (i) it has such knowledge in
          -----------
business  and  financial  matters  as to be fully  capable  of  evaluating  this
Agreement,  the other Transaction Documents,  and the transactions  contemplated
hereby and thereby,  (ii) it is not relying on any advice or  representation  of
any other party in  connection  with  entering  into this  Agreement,  the other
Transaction Documents, or such transactions (other than the representations made
in this Agreement or the other Transaction Documents), (iii) it has not received
from such party any  assurance  or guarantee  as to the merits  (whether  legal,
regulatory,  tax, financial or otherwise) of entering into this Agreement or the



                                       21
<PAGE>






other Transaction  Documents or the performance of its obligations hereunder and
thereunder,  and (iv) it has  consulted  with its own  legal,  regulatory,  tax,
business,  investment,  financial and accounting  advisors to the extent that it
has  deemed  necessary,  and has  entered  into  this  Agreement  and the  other
Transaction Documents based on its own independent judgment and on the advice of
its advisors as it has deemed necessary, and not on any view (whether written or
oral) expressed by such other party.

     6.4  Independent   Nature  of  Investors'   Obligations  and  Rights.   The
          ---------------------------------------------------------------
obligations  of each  Investor  hereunder  are  several  and not joint  with the
obligations  of  the  other  Investors  hereunder,  and  no  Investor  shall  be
responsible  in any way for the  performance  of the  obligations  of any  other
Investor  hereunder.  Nothing  contained  herein  or in any other  agreement  or
document delivered at the Closing,  and no action taken by any Investor pursuant
hereto or thereto, shall be deemed to constitute the Investors as a partnership,
an  association,  a joint  venture  or any  other  kind of  entity,  or create a
presumption  that the Investors are in any way acting in concert with respect to
such  obligations  or the  transactions  contemplated  by this  Agreement.  Each
Investor shall be entitled to protect and enforce its rights,  including without
limitation  the rights  arising out of this  Agreement or the other  Transaction
Documents,  and it shall not be necessary for any other Investor to be joined as
an additional party in any proceeding for such purpose.

     6.5  Injunctive Relief.  The Company  acknowledges and agrees that a breach
          -----------------
by it of its obligations  hereunder will cause irreparable harm to each Investor
and that the remedy or remedies  at law for any such  breach will be  inadequate
and agrees,  in the event of any such breach, in addition to all other available
remedies,  such  Investor  shall be entitled to an  injunction  restraining  any
breach and requiring  immediate  and specific  performance  of such  obligations
without the necessity of showing economic loss.

     6.6  Governing Law;  Jurisdiction.  This Agreement shall be governed by and
          ----------------------------
construed  under the laws of the State of New York  applicable to contracts made
and to be  performed  entirely  within the State of New York.  Each party hereby
irrevocably  submits to the non-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, and hereby irrevocably waives, and agrees not
to assert in any suit, action or proceeding  involving any Investor or permitted
assignee  of an  Investor,  any claim that it is not  personally  subject to the
jurisdiction of any such court,  that such suit, action or proceeding is brought
in an inconvenient forum or that the venue of 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 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.

     6.7  Counterparts.  This  Agreement  may  be  executed  in  any  number  of
          ------------
counterparts,  each of  which  shall be  deemed  an  original,  and all of which
together  shall  constitute one and the same  instrument.  This Agreement may be
executed and delivered by facsimile transmission.




                                       22
<PAGE>






     6.8  Headings. The headings used in this Agreement are used for convenience
          --------
only and are not to be considered in construing or interpreting this Agreement.

     6.9  Notices.  Any notice,  demand or request  required or  permitted to be
          -------
given by the  Company or an  Investor  pursuant  to the terms of this  Agreement
shall be in writing and shall be deemed delivered (i) when delivered  personally
or by verifiable facsimile  transmission,  unless such delivery is made on a day
that is not a Business  Day,  in which case such  delivery  will be deemed to be
made on the next  succeeding  Business  Day, (ii) on the next Business Day after
timely  delivery to an overnight  courier and (iii) on the Business Day actually
received if deposited in the U.S. mail  (certified or  registered  mail,  return
receipt requested, postage prepaid), addressed as follows:

     If to the Company:

     Raptor Networks Technology, Inc.
     65 Enterprise Road, Suite 420
     Aliso Viejo, CA 92656
     Attn:  Tom Wittenschlaeger
     Tel:   (949) 330-6540
     Fax:   (949) 330-6579

     with a copy to:

     Eugene M. Kennedy, Esq.
     517 S.W. First Avenue
     Ft. Lauderdale, FL 33301
     Tel:   (954) 524-4155
     Fax:   (954) 524-4169

and if to any Investor, to such address for such Investor as shall appear on the
signature page hereof  executed by such  Investor,  or as shall be designated by
such Investor in writing to the Company in accordance with this Section 6.9.

     6.10  Expenses.  The Company  and each  Investor  shall  pay all  costs and
           --------
expenses that it incurs in connection with the negotiation,  execution, delivery
and performance of this Agreement or the other Transaction Documents,  provided,
                                                                       --------
however,  that that the Company shall, at the Closing,  pay up to (i) $50,000 in
-------
immediately  available funds for all out-of-pocket  expenses  (including without
limitation  legal fees and  expenses)  incurred by Satellite  Strategic  Finance
Associates,  LLC ("Satellite") in connection its due diligence  investigation of
the  Company  and  the  negotiation,   preparation,   execution,   delivery  and
performance  of this  Agreement and the other  Transaction  Documents,  and (ii)
$10,000 in immediately  available funds for legal fees and expenses  incurred by
Longview  Equity Funds,  LP in connection  with its review of this Agreement and
the other Transaction  Documents.  At the Closing,  the amount due for such fees
and expenses  (which may include fees and expenses  estimated to be incurred for
completion of the transaction and post-closing matters) may be netted out of the
Purchase  Price  payable by  Satellite  Strategic  Finance  Associates,  LLC and
Longview  Equity Fund,  LP. In the event the amount paid by the Company for such
fees and expenses is less than the amount of fees and expenses actually incurred



                                       23
<PAGE>






by Satellite,  the Company shall promptly pay such  deficiency (up to $50,000 in
the aggregate) within thirty (30) days following receipt of an invoice therefor.
Notwithstanding  anything herein to the contrary,  if the Closing does not occur
otherwise  than as a result of a breach of this  Agreement by an  Investor,  the
Company shall remain obligated to pay the expenses of Satellite up to $50,000 in
the aggregate.

     6.11 Entire Agreement; Amendments. This Agreement and the other Transaction
          ----------------------------
Documents constitute the entire agreement between the parties with regard to the
subject  matter  hereof  and  thereof,   superseding  all  prior  agreements  or
understandings, whether written or oral, between or among the parties. Except as
expressly  provided  herein,  neither this  Agreement nor any term hereof may be
amended except pursuant to a written instrument  executed by the Company and the
holders of at least  two-thirds  (2/3) of the number of Outstanding  Registrable
Securities,  and no  provision  hereof  may be  waived  other  than by a written
instrument  signed by the party against whom  enforcement  of any such waiver is
sought.


                           [Signature Pages to Follow]







































                                       24
<PAGE>


     IN WITNESS WHEREOF,  the undersigned have executed this Agreement as of the
date first-above written.

RAPTOR NETWORKS TECHNOLOGY, INC.


By:
     --------------------------
     Name:
     Title:


SATELLITE STRATEGIC FINANCE ASSOCIATES, LLC


By:
     --------------------------
     Name:
     Title:


ADDRESS:

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

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

     Tel:
          --------------------------

     Fax:
          --------------------------


Shares to be Purchased:
                        ---------------

EIN:

















                                       25