REGISTRATION RIGHTS AGREEMENT

          This  Registration  Rights  Agreement  (this  "Agreement") is made and
entered  into  as  of  December  27, 2006, by and among DigitalFX International,
Inc.,  a  Florida  corporation  (the  "Company"),  and  the  several  purchasers
signatory  hereto  (each  a  "Purchaser"  and  collectively,  the "Purchasers").

          This  Agreement is made pursuant to the Securities Purchase Agreement,
dated  as  of  the  date  hereof  between  the  Company  and each Purchaser (the
"Purchase  Agreement").

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

     1.     Definitions.  Capitalized  terms  used  and  not  otherwise  defined
            -----------
herein  that are defined in the Purchase Agreement shall have the meanings given
such  terms in the Purchase Agreement.  As used in this Agreement, the following
terms  shall  have  the  respective  meanings  set  forth  in  this  Section  1:

          "Advice"  shall  have  the  meaning  set  forth  in  Section  6(f).

          "Affiliate"  means, with respect to any person, any other person which
directly  or  indirectly  controls, is controlled by, or is under common control
with,  such  person.

          "Business  Day" means a day, other than a Saturday or Sunday, on which
banks  in  New  York  City  are  open  for  the general transaction of business.

          "Closing"  has  the  meaning  set  forth  in  the  Purchase Agreement.

          "Closing  Date"  has  the meaning set forth in the Purchase Agreement.

          "Commission"  means  the  Securities  and  Exchange  Commission.

          "Common  Stock"  means  the  common  stock  of  the Company, par value
$0.0001  per  share,  and  any  securities  into  which  such  common  stock may
hereinafter  be  reclassified.

          "Effective  Date" means the date that the Registration Statement filed
pursuant  to  Section  2(a)  is  first  declared  effective  by  the Commission.

          "Effectiveness  Deadline"  means,  with  respect  to  the Registration
Statement  required  to  be  filed  to  cover  the  resale by the Holders of the
Registrable  Securities, the earlier of: (i) the 90th calendar day following the
Closing Date; provided, that, if the Commission reviews and has written comments
to  the filed Registration Statement, then the Effectiveness Deadline under this
clause  (i) shall be the 135th calendar day following the Closing Date, and (ii)
the  fifth (5th) Trading Day following the date on which the Company is notified
by  the Commission that the Registration Statement will not be reviewed or is no
longer  subject  to  further  review  and  comments and the effectiveness of the
Registration  Statement  may  be  accelerated.

          "Effectiveness  Period"  shall  have  the meaning set forth in Section
2(b).

          "Event"  shall  have  the  meaning  set  forth  in  Section  2(c).


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          "Event  Date"  shall  have  the  meaning  set  forth  in Section 2(c).

          "Exchange  Act" means the Securities Exchange Act of 1934, as amended,
and  the  rules  and  regulations  promulgated  thereunder.

          "Filing  Deadline"  means,  with respect to the Registration Statement
required  to  be filed pursuant to Section 2(a), the 35th calendar day following
the  Closing  Date.

          "Holder" or "Holders" means the holder or holders, as the case may be,
from  time  to  time  of  Registrable  Securities.

          "Indemnified  Party" shall have the meaning set forth in Section 5(c).

          "Indemnifying Party" shall have the meaning set forth in Section 5(c).

          "Losses"  shall  have  the  meaning  set  forth  in  Section  5(a).

          "New  York  Courts"  means the state and federal courts sitting in the
City  of  New  York,  Borough  of  Manhattan.

          "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.

          "Placement  Agent"  means Roth Capital Partners, LLC and any permitted
assigns.

          "Principal  Trading  Market"  means  the  Trading  Market on which the
Common  Stock  is  primarily  listed on and quoted for trading, which, as of the
Closing  Date,  shall  be  the  OTC  Bulletin  Board.

          "Proceeding" means an action, claim, suit, investigation or proceeding
(including,  without limitation, an investigation or partial proceeding, such as
a  deposition),  whether  commenced  or  threatened.

          "Prospectus" means the prospectus included in a Registration Statement
(including,  without  limitation,  a  prospectus  that  includes any information
previously  omitted from a prospectus filed as part of an effective registration
statement  in  reliance upon Rule 430A promulgated under the Securities Act), as
amended  or supplemented by any prospectus supplement, with respect to the terms
of  the  offering  of  any  portion  of  the Registrable Securities covered by a
Registration  Statement,  and  all  other  amendments  and  supplements  to  the
Prospectus,  including  post-effective amendments, and all material incorporated
by  reference  or  deemed  to  be  incorporated by reference in such Prospectus.

          "Register,"  "registered"  and  "registration" refer to a registration
made  by  preparing  and  filing a Registration Statement or similar document in
compliance  with  the  Securities  Act,  and  the  declaration  or  ordering  of
effectiveness  of  such  Registration  Statement  or  document.

          "Registrable Securities" means all of (i) the Shares issuable and (ii)
any  securities  issued  or  issuable  upon  any  stock split, dividend or other
distribution,  recapitalization  or similar event; provided, that the Holder has
completed  and delivered to the Company a Selling Shareholder Questionnaire; and
provided,  further,  that  a  Holder's  security  shall  cease to be Registrable
Securities  upon the earliest to occur of the following:  (A) sale pursuant to a
Registration  Statement  or  Rule  144  under  the  Securities  Act


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(in  which  case,  only  such  security  sold  shall  cease  to be a Registrable
Security);  or  (B)  such  security  becoming  eligible  for  sale by the Holder
pursuant  to  Rule  144(k).

          "Registration  Statement"  means  any  registration  statement  of the
Company  filed  under  the  Securities  Act that covers the resale of any of the
Registrable  Securities pursuant to the provisions of this Agreement, amendments
and  supplements  to  such  Registration  Statement,  including  post-effective
amendments, all exhibits and all material incorporated by reference or deemed to
be  incorporated  by  reference  in  such  Registration  Statement.

          "Rule  144"  means  Rule 144 promulgated by the Commission pursuant to
the  Securities  Act,  as  such  Rule  may  be amended from time to time, or any
similar  rule  or  regulation  hereafter  adopted  by  the  Commission  having
substantially  the  same  effect  as  such  Rule.

          "Rule  415"  means  Rule 415 promulgated by the Commission pursuant to
the  Securities  Act,  as  such  Rule  may  be amended from time to time, or any
similar  rule  or  regulation  hereafter  adopted  by  the  Commission  having
substantially  the  same  effect  as  such  Rule.

          "Rule  424"  means  Rule 424 promulgated by the Commission pursuant to
the  Securities  Act,  as  such  Rule  may  be amended from time to time, or any
similar  rule  or  regulation  hereafter  adopted  by  the  Commission  having
substantially  the  same  effect  as  such  Rule.

          "Securities Act" means the Securities Act of 1933, as amended, and the
rules  and  regulations  promulgated  thereunder.

          "Selling  Shareholder Questionnaire" means a questionnaire in the form
attached  as  Annex  B  hereto,  or  such  other  form  of  questionnaire as may
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reasonably  be  adopted  by  the  Company  from  time  to  time.

          "Shares"  means  the  shares of Common Stock issued or issuable to the
Purchasers  pursuant  to  the  Purchase  Agreement.

          "Subscription  Amount" means $4.75 (as subject to adjustment for stock
splits, stock dividends, and stock combinations affecting the Shares), being the
per  Share purchase price paid by each Purchaser for the securities purchased by
such  Purchaser  pursuant  to  the  Purchase  Agreement.

          "Trading  Day"  means (i) a day on which the Common Stock is listed or
quoted  and  traded  on  its primary Trading Market (other than the OTC Bulletin
Board),  or  (ii)  if  the Common Stock is not listed on a Trading Market (other
than  the  OTC Bulletin Board), a day on which the Common Stock is traded in the
over-the-counter  market, as reported by the OTC Bulletin Board, or (iii) if the
Common  Stock  is  not  quoted  on any Trading Market, a day on which the Common
Stock  is  quoted  in  the  over-the-counter  market as reported by the National
Quotation  Bureau Incorporated (or any similar organization or agency succeeding
to  its  functions  of  reporting  prices); provided, that in the event that the
Common Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof,
then  Trading  Day  shall  mean  a  Business  Day.

          "Trading  Market"  means whichever of the New York Stock Exchange, the
American  Stock  Exchange,  the  NASDAQ  Global Select Market, the NASDAQ Global
Market,  the  NASDAQ  Capital  Market  or OTC Bulletin Board on which the Common
Stock  is  listed  or  quoted  for  trading  on  the  date  in  question.


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<PAGE>
     2.     Registration.

          (a)     On  or prior to the Filing Deadline, the Company shall prepare
and file with the Commission a Registration Statement covering the resale of all
Registrable  Securities  not  already  covered  by  an  existing  and  effective
Registration Statement for an offering to be made on a continuous basis pursuant
to  Rule  415.  The  Registration  Statement shall be on Form S-3 (except if the
Company  is  not then eligible to register for resale the Registrable Securities
on  Form  S-3,  in  which case such registration shall be on another appropriate
form  in  accordance  with  the  Securities  Act and the Exchange Act) and shall
contain (except if otherwise required pursuant to written comments received from
the  Commission  upon  a  review  of  such  Registration Statement) the "Plan of
Distribution"  attached  hereto  as  Annex  A.

          (b)     The  Company  shall  use  its  best  efforts  to  cause  the
Registration  Statement  to  be  declared effective by the Commission as soon as
practicable  and,  in  any  event,  no  later  than  the  Effectiveness Deadline
(including  filing  with  the  Commission  a  request  for  acceleration  of
effectiveness  in  accordance with Rule 461 promulgated under the Securities Act
within  five  (5)  Business  Days  after  the  date that the Company is notified
(orally  or  in  writing,  whichever  is  earlier)  by  the  Commission  that  a
Registration  Statement  will  not  be  "reviewed," or not be subject to further
review  and  the effectiveness of the Registration Statement may be accelerated)
and  shall  use  its  reasonable best efforts to keep the Registration Statement
continuously  effective  under the Securities Act until the earlier of (i)  such
time as all of the Registrable Securities covered by such Registration Statement
have  been  publicly  sold by the Holders, or (ii) the date that all Registrable
Securities  covered  by the Registration Statement may be sold by non-affiliates
without  volume restrictions pursuant to Rule 144(k) as determined by counsel to
the  Company  pursuant to a written opinion letter to such effect, addressed and
acceptable  to  the  Company's  transfer  agent  and  the  affected Holders (the
"Effectiveness  Period").  The  Company  shall  ensure  that  each  Registration
Statement  (including  any  amendments  or  supplements thereto and prospectuses
contained  therein) shall not contain any untrue statement of a material fact or
omit  to  state  a  material fact required to be stated therein, or necessary to
make  the  statements  therein (in the case of prospectuses, in the light of the
circumstances  in  which  they  were  made)  not  misleading.  Such Registration
Statement shall also cover, to the extent allowable under the Securities Act and
the rules promulgated thereunder (including Rule 416), such indeterminate number
of  additional  shares  of  Common  Stock  resulting  from  stock  splits, stock
dividends  or  similar  transactions with respect to the Registrable Securities.
The  Company  shall  telephonically  request  effectiveness  of  a  Registration
Statement  as  of  5:00  pm  Eastern  Time on a Trading Day.   The Company shall
immediately notify the Holders via facsimile or e-mail of the effectiveness of a
Registration  Statement  on the same Trading Day that the Company telephonically
confirms  effectiveness  with  the Commission, which shall be the date requested
for  effectiveness  of  a Registration Statement.  The Company shall, by 9:30 am
Eastern  Time  on  the  Trading  Day after the Effective Date (as defined in the
Purchase  Agreement),  file  a  final Prospectus with the Commission pursuant to
Rule  424.  Failure  to  so  notify  the  Holder  within  1  Trading Day of such
notification or effectiveness or failure to file a final Prospectus as aforesaid
shall  be  deemed  an  Event  under  Section  2(c).

          (c)     If: (i) the Registration Statement is not filed on or prior to
the  Filing Deadline, (ii) a Registration Statement is not declared effective by
the  Commission  (or  otherwise  does  not  become effective) on or prior to its
Effectiveness  Deadline  or  (iii)  after  its Effective Date, such Registration
Statement  ceases  for  any  reason (including without limitation by reason of a
stop  order, or the Company's failure to update the Registration Statement), but
excluding the inability of any Holder to sell the Registrable Securities covered
thereby due to market conditions, to remain continuously effective and available
to the Holders as to all Registrable Securities to which it is required to cover
at any time prior to the expiration of the Effectiveness Period for an aggregate
of  more  than  30  consecutive Trading Days or for more than an aggregate of 60
Trading  Days  in any 12-month period (which need not be consecutive), (any such
failure  or  breach  in clauses (i), (ii) or (iii) above being referred to as an
"Event,"  and, for purposes of clauses (i) or (ii), the date on which such Event
occurs,  or  for purposes of clause (iii), the date which such 30 consecutive or
60  Trading  Day period (as applicable) is exceeded, being referred to as "Event
Date"),  then  in  addition to any other rights available to the Holders: (x) on
such  Event  Date  the


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<PAGE>
Company  shall  pay  to  each  Holder  an  amount in cash, as partial liquidated
damages and not as a penalty, equal to 1.0% of the aggregate purchase price paid
by such Holder pursuant to the Purchase Agreement for any Registrable Securities
then  held  by  such  Holder  (which  remedy shall not be exclusive of any other
remedies available under this Agreement); and (y) on each monthly anniversary of
each  such Event Date thereof (if the applicable Event shall not have been cured
by such date) until the applicable Event is cured, the Company shall pay to each
Holder  an  amount  in cash, as partial liquidated damages and not as a penalty,
equal  to  1.0%  of the aggregate purchase price paid by such Holder pursuant to
the  Purchase  Agreement for any Registrable Securities then held by such Holder
(which  remedy shall not be exclusive of any other remedies available under this
Agreement).  If the Company fails to pay any partial liquidated damages pursuant
to  this  Section  in full within seven days after the date payable, the Company
will  pay  interest  thereon  at a rate of 10% per annum (or such lesser maximum
amount  that  is permitted to be paid by applicable law) to the Holder, accruing
daily  from the date such partial liquidated damages are due until such amounts,
plus  all  such  interest  thereon,  are  paid  in full.  The partial liquidated
damages  pursuant  to the terms hereof shall apply on a daily pro-rata basis for
any  portion of a month prior to the cure of an Event, except in the case of the
first Event Date. Notwithstanding the foregoing, the maximum payment to a Holder
associated  with  all Events in the aggregate shall not exceed (i) in any 30-day
period,  an  aggregate of 1.0% of the purchase price paid by such Holder for its
Registrable  Securities  (plus interest accrued thereon, if applicable) and (ii)
18.0%  of  the purchase price paid by such Holder for its Registrable Securities
in  any  12  month  period,  unless,  as a result of this clause (ii), Generally
Accepted  Accounting Principles ("GAAP"), including without limitation, FAS 133,
EITF  00-19  or  any  other  interpretation  of  GAAP,  require  the Registrable
Securities  to  be  treated  as a derivative security, or as any other financial
component  other  than in stockholders equity, in which case, the maximum amount
payable  under  this  Section  2(c) shall not exceed 18.0% of the purchase price
paid  by  such  Holder  for  its  Registrable  Securities.

     (d)     The  Company  shall  not,  from  the  date  hereof  until  the date
occurring  sixty  (60)  days  after  the  Effective  Date  of  the  Registration
Statement,  prepare  and  file  with  the  Commission  a  registration statement
relating  to  an offering for its own account or the account of others under the
Securities  Act  of  any  of  its  equity  securities  other than a registration
statement  on  Form  S-8  or,  in  connection  with an acquisition, on Form S-4.

     (e)     Each  Holder  agrees  to  furnish  to  the  Company a completed and
executed  Selling  Shareholder Questionnaire.  The Company shall not be required
to  include  the  Registrable Securities of a Holder in a Registration Statement
and  shall  not be required to pay any liquidated or other damages under Section
2(c)  to  any  Holder  who fails to furnish to the Company a fully completed and
executed  Selling  Shareholder  Questionnaire at least two Trading Days prior to
the  Filing  Deadline  (subject  to the requirements set forth in Section 3(a)).

     (f)     It  is  agreed  and understood that the Company shall, from time to
time,  be  obligated  to  file an additional Registration Statement to cover any
Registrable  Securities  which  are  not  registered  for  resale  pursuant to a
pre-existing  Registration  Statement.

     (g)     Notwithstanding  anything in this Agreement to the contrary, if the
Commission  refuses  to  declare a Registration Statement filed pursuant to this
Agreement  effective  as  a  valid  secondary offering under Rule 415 due to the
number  of  Registrable  Securities  included  in  such  Registration  Statement
relative  to the outstanding number of shares of Common Stock, then, without any
obligation  to pay any amount under Section 2(c) with respect to, or any further
obligation to register, such excess Registrable Securities, the Company shall be
permitted  to  reduce  the  number  of  Registrable  Securities included in such
Registration  Statement  to  an  amount  that does not exceed an amount that the
Commission  allows  for  the offering thereunder to qualify as a valid secondary
offering  under  Rule  415.


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<PAGE>
     3.     Registration  Procedures
            ------------------------

          In  connection  with the Company's registration obligations hereunder,
the  Company  shall:

          (a)     Not  less  than  three  Trading  Days prior to the filing of a
Registration  Statement or any related Prospectus or any amendment or supplement
thereto,  furnish  to  each  Holder  copies  of  such  Registration  Statement,
Prospectus  or  amendment  or supplement thereto, as proposed to be filed, which
documents  will  be  subject to the review of such Holder (it being acknowledged
and  agreed that if a Holder does not object to or comment on the aforementioned
documents  within such three Trading Day period, then the Holder shall be deemed
to have consented to and approved the use of such documents).  The Company shall
not  file  a  Registration  Statement,  any  Prospectus  or  any  amendments  or
supplements  thereto  in which the "Selling Stockholder" section thereof differs
from  the  disclosure  received  from  a  Holder  in  its  Selling  Shareholder
Questionnaire  (as amended or supplemented), except as may otherwise be required
by  applicable  securities  law  or  the  Commission.

          (b)     (i)  Prepare  and  file  with  the Commission such amendments,
including  post-effective  amendments,  to  each  Registration Statement and the
Prospectus  used  in  connection  therewith  as  may  be  necessary to keep such
Registration  Statement  continuously effective as to the applicable Registrable
Securities for its Effectiveness Period and prepare and file with the Commission
such  additional  Registration  Statements in order to register for resale under
the  Securities  Act  all  of the Registrable Securities; (ii) cause the related
Prospectus  to be amended or supplemented by any required Prospectus supplement,
and  as  so  supplemented  or  amended  to  be filed pursuant to Rule 424; (iii)
respond  as promptly as reasonably practicable, and in any event within ten (10)
Trading  Days, to any comments received from the Commission with respect to each
Registration  Statement  or any amendment thereto and, as promptly as reasonably
possible,  provide  the  Holders  true and complete copies of all correspondence
from and to the Commission relating to such Registration Statement that pertains
to the Holders as Selling Stockholders but not any comments that would result in
the  disclosure to the Holders of material and non-public information concerning
the  Company;  and (iv) comply with the provisions of the Securities Act and the
Exchange  Act  with  respect  to  the  disposition of all Registrable Securities
covered  by  each  Registration  Statement.

          (c)     Notify the Holders as promptly as reasonably possible (and, in
the case of (i)(A) below, not less than three Trading Days prior to such filing,
in  the  case  of (iii) and (iv) below, not more than one Trading Day after such
issuance  or  receipt and, in the case of (v) below, not less than three Trading
Days  prior  to  the financial statements in any Registration Statement becoming
ineligible  for inclusion therein) and (if requested by any such Person) confirm
such  notice  in  writing no later than one Trading Day following the day (i)(A)
when  a Prospectus or any Prospectus supplement or post-effective amendment to a
Registration Statement is proposed to be filed; (B) when the Commission notifies
the  Company whether there will be a "review" of such Registration Statement and
whenever  the  Commission  comments in writing on any Registration Statement (in
which  case  the  Company shall provide true and complete copies thereof and all
written  responses thereto to each of the Holders that pertain to the Holders as
a  Selling Stockholder or to the Plan of Distribution, but not information which
the  Company believes would constitute material and non-public information); and
(C) with respect to each Registration Statement or any post-effective amendment,
when the same has become effective; (ii) of any request by the Commission or any
other Federal or state governmental authority for amendments or supplements to a
Registration Statement or Prospectus or for additional information that pertains
to the Holders as Selling Stockholders or the Plan of Distribution; (iii) of the
issuance  by the Commission or any other federal or state governmental authority
of  any  stop  order  suspending  the  effectiveness of a Registration Statement
covering  any  or  all  of  the  Registrable Securities or the initiation of any
Proceedings  for  that  purpose;  (iv)  of  the  receipt  by  the Company of any
notification  with  respect  to the suspension of the qualification or exemption
from  qualification  of  any  of  the  Registrable  Securities  for  sale in any
jurisdiction,  or  the


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<PAGE>
initiation  or  threatening  of  any Proceeding for such purpose; and (v) of the
occurrence  of  any event or passage of time that makes the financial statements
included  in  a  Registration  Statement ineligible for inclusion therein or any
statement  made  in  such  Registration  Statement or Prospectus or any document
incorporated  or  deemed  to  be incorporated therein by reference untrue in any
material  respect or that requires any revisions to such Registration Statement,
Prospectus  or  other  documents  so  that,  in  the  case  of such Registration
Statement  or the Prospectus, as the case may be, it will not contain any untrue
statement  of  a material fact or omit to state any material fact required to be
stated  therein  or necessary to make the statements therein (in the case of any
Prospectus,  form  of  prospectus  or  supplement  thereto,  in  light  of  the
circumstances  under  which  they  were  made),  not  misleading.

          (d)     Use  reasonable  best efforts to avoid the issuance of, or, if
issued, obtain the withdrawal of (i) any order suspending the effectiveness of a
Registration  Statement,  or  (ii)  any  suspension  of  the  qualification  (or
exemption  from  qualification) of any of the Registrable Securities for sale in
any  jurisdiction,  as  soon  as  practicable.

          (e)     If  requested  by  a  Holder,  furnish to such Holder, without
charge,  at  least  one  conformed  copy of each Registration Statement and each
amendment  thereto  and  all  exhibits  to  the  extent requested by such Person
(including  those  previously  furnished  or incorporated by reference) promptly
after  the  filing  of  such  documents  with the Commission; provided, that the
Company shall have no obligation to provide any document pursuant to this clause
that  is  available  on  the  Commission's  EDGAR  system.

          (f)     Upon  notification  by  the  Commission  that  a  Registration
Statement  will  not  be  reviewed or is no longer subject to further review and
comments,  the Company shall request acceleration of such Registration Statement
within  five (5) Business Days after receipt of such notice such that it becomes
effective  no  later than 5:00 p.m. New York City time on the Effective Date and
file  a  prospectus supplement for any Registration Statement, whether or not it
is  required  under Rule 424 (or otherwise), by 9:00 a.m. New York City time the
day  after  the  Effective  Date.

          (g)     Prior  to  any  public  offering  of  Registrable  Securities,
register  or  qualify  such  Registrable Securities for offer and sale under the
securities  or  Blue  Sky laws of such jurisdictions within the United States as
any  Holder  reasonably  requests  in writing, to keep each such registration or
qualification (or exemption therefrom) effective during the Effectiveness Period
and  to  do  any and all other acts or things reasonably necessary to enable the
disposition  in  such jurisdictions of the Registrable Securities covered by the
Registration  Statements;  provided,  that  the Company shall not be required to
qualify  generally  to  do  business in any jurisdiction where it is not then so
qualified  or  to  take  any  action  that  would subject the Company to general
service  of  process  in  any  jurisdiction  where  it is not then so subject or
subject the Company to any material tax in any such jurisdiction where it is not
then  so  subject.

          (h)     If  requested  by  the  Holders, cooperate with the Holders to
facilitate  the  timely  preparation  and  delivery of certificates representing
Registrable  Securities  to  be  delivered  to  a  transferee  pursuant  to  the
Registration  Statement,  which  certificates  shall  be  free,  to  the  extent
permitted  by  the Purchase Agreement and under law, of all restrictive legends,
and  to  enable  such  Registrable  Securities  to  be in such denominations and
registered  in  such  names  as  any  such  Holders  may reasonably request.  In
connection  therewith,  if required by the Company's transfer agent, the Company
shall  promptly  after  the effectiveness of the Registration Statement cause an
opinion  of  counsel as to the effectiveness of the Registration Statement to be
delivered  to  and  maintained  with its transfer agent, together with any other
authorizations,  certificates  and  directions  required  by the transfer agent,
which  authorize  and  direct  the  transfer  agent  to  issue  such Registrable
Securities  without legend upon sale by the holder of such shares of Registrable
Securities  under  the  Registration  Statement.


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<PAGE>
          (i)     Following  the occurrence of any event contemplated by Section
3(c)(v),  as promptly as reasonably possible, prepare a supplement or amendment,
including a post-effective amendment, to the affected Registration Statements or
a supplement to the related Prospectus or any document incorporated or deemed to
be  incorporated  therein  by reference, and file any other required document so
that, as thereafter delivered, no Registration Statement nor any Prospectus will
contain  an untrue statement of a material fact or omit to state a material fact
required  to  be  stated therein or necessary to make the statements therein (in
the  case  of any Prospectus, form of prospectus or supplement thereto, in light
of  the  circumstances  under  which  they  were  made),  not  misleading.

          (j)     (i)  In  the time and manner required by the Principal Trading
Market,  prepare  and file with such Trading Market an additional shares listing
application  covering  all  of  the  Registrable Securities, (ii) take all steps
necessary to cause such Registrable Securities to be approved for listing on the
Principal  Trading  Market as soon as possible thereafter, (iii) if requested by
any  Holder,  provide  such Holder evidence of such listing, and (iv) during the
Effectiveness Period, maintain the listing of such Registrable Securities on the
Principal  Trading  Market.

          (k)     As  long  as  any Holder owns Shares, 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  any  Holder  owns  Shares,  if  the  Company is not required to file reports
pursuant  to  Section  13(a)  or  15(d) of the Exchange Act, it will prepare and
furnish  to  the  Holders  and  make  publicly available in accordance with Rule
144(c)  promulgated  under  the  Securities  Act  annual and quarterly financial
statements, together with a discussion and analysis of such financial statements
in  form  and  substance  substantially similar to those that would otherwise be
required  to  be  included  in reports required by Section 13(a) or 15(d) of the
Exchange  Act,  as  well  as any other information required thereby, in the time
period  that  such  filings would have been required to have been made under the
Exchange  Act.  The  Company  further  covenants  that it will take such further
action  as  any  Holder  may reasonably request, all to the extent required from
time to time to enable such Person to sell Shares without registration under the
Securities  Act  within  the  limitation  of the exemptions provided by Rule 144
promulgated  under  the Securities Act, including compliance with the provisions
of  the  Purchase  Agreement  relating  to  the  transfer  of  the  Shares.

          (l)     The  Company may require each selling Holder to furnish to the
Company  a  certified  statement  as  to  the  number  of shares of Common Stock
beneficially  owned  by such Holder and any Affiliate thereof and as to any NASD
affiliations and of any natural persons who have the power to vote or dispose of
the  Common  Stock.

     4.     Registration  Expenses.  All  fees  and  expenses  incident  to  the
            ----------------------
Company's performance of or compliance with its obligations under this Agreement
(excluding any underwriting discounts and selling commissions and all legal fees
and  expenses  of  legal  counsel  for any Holder) shall be borne by the Company
whether  or  not  any Registrable Securities are sold pursuant to a Registration
Statement.  The  fees  and  expenses referred to in the foregoing sentence shall
include,  without  limitation,  (i) all registration and filing fees (including,
without limitation, fees and expenses (A) with respect to filings required to be
made  with the securities exchanges on which the Common Stock is then listed for
trading,  and  (B)  in  compliance  with applicable state securities or Blue Sky
laws),  (ii)  printing  expenses  (including,  without  limitation,  expenses of
printing certificates for Registrable Securities and of printing prospectuses if
the  printing  of  prospectuses  is  reasonably  requested  by  the Holders of a
majority  of the Registrable Securities included in the Registration Statement),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of
counsel  for the Company, (v) Securities Act liability insurance, if the Company
so  desires  such  insurance,  and  (vi)  fees and expenses of all other Persons
retained  by the Company in connection with the consummation of the transactions
contemplated  by  this  Agreement.  In  addition,  the


                                        8
<PAGE>
Company  shall  be  responsible  for  all  of  its internal expenses incurred in
connection  with  the  consummation  of  the  transactions  contemplated by this
Agreement  (including,  without  limitation,  all  salaries  and expenses of its
officers  and  employees  performing legal or accounting duties), the expense of
any  annual  audit  and  the  fees  and expenses incurred in connection with the
listing  of  the  Registrable  Securities on any securities exchange as required
hereunder.  In  no  event  shall  the  Company  be responsible for any broker or
similar  commissions  or  any  legal  fees  or  other  costs  of  the  Holders.

     5.     Indemnification.
            ---------------

          (a)     Indemnification  by  the  Company.  The  Company  shall,
                  ---------------------------------
notwithstanding  any  termination of this Agreement, indemnify and hold harmless
each  Holder,  the  officers,  directors,  agents,  partners, members, managers,
shareholders, Affiliates and employees of each of them, each Person who controls
any  such  Holder  (within  the  meaning  of Section 15 of the Securities Act or
Section  20 of the Exchange Act) and the officers, directors, partners, members,
managers, shareholders, agents and employees of each such controlling Person, to
the  fullest  extent  permitted  by applicable law, from and against any and all
losses,  claims,  damages,  liabilities,  costs  (including, without limitation,
reasonable  costs  of  preparation  and  investigation and reasonable attorneys'
fees)  and  expenses  (collectively,  "Losses"),  as incurred, arising out of or
relating  to  (i)  any  untrue  or  alleged  untrue statement of a material fact
contained  in  any  Registration  Statement,  any  Prospectus  or  any  form  of
prospectus  or  in any amendment or supplement thereto (it being understood that
the  Holder  has approved Annex A hereto for this purpose) or in any preliminary
prospectus, or arising out of or relating to any omission or alleged omission of
a  material  fact  required  to  be  stated  therein  or  necessary  to make the
statements  therein  (in  the  case  of  any Prospectus or form of prospectus or
supplement  thereto,  in  light of the circumstances under which they were made)
not misleading, or (ii) any violation or alleged violation by the Company of the
Securities  Act,  Exchange  Act  or  any  state  securities  law, or any rule or
regulation  thereunder,  in  connection  with the performance of its obligations
under  this  Agreement,  except  to the extent, but only to the extent, that (A)
such  untrue  statements,  alleged  untrue  statements,  omissions  or  alleged
omissions  are  based solely upon information regarding such Holder furnished in
writing  to  the  Company  by  such  Holder expressly for use therein, or to the
extent  that  such  information relates to such Holder or such Holder's proposed
method  of  distribution of Registrable Securities and was reviewed and approved
by  such Holder expressly for use in the Registration Statement, such Prospectus
or  such  form of Prospectus or in any amendment or supplement thereto (it being
understood that each Holder has approved Annex A hereto for this purpose) or (B)
in  the  case  of  an  occurrence  of  an event of the type specified in Section
3(c)(ii)-(v),  the  use by a Holder of an outdated or defective Prospectus after
the  Company has notified such Holder in writing that the Prospectus is outdated
or  defective  and  prior to the receipt by such Holder of Advice (as defined in
Section 6(f) below), but only if and to the extent that following the receipt of
the Advice the misstatement or omission giving rise to such Loss would have been
corrected;  provided,  however,  that  the indemnity agreement contained in this
Section 5(a) shall not apply to amounts paid in settlement of any Losses if such
settlement  is  effected without the prior written consent of the Company, which
consent  shall  not  be  unreasonably  withheld.  Each  Holder  shall notify the
Company  promptly  of  the institution, threat or assertion of any Proceeding of
which  the  Holder  is aware in connection with the transactions contemplated by
this Agreement.  Such indemnity shall remain in full force and effect regardless
of any investigation made by or on behalf of an Indemnified Party (as defined in
Section  5(c))  and  shall survive the transfer of the Registrable Securities by
the  Holders.

          (b)     Indemnification by Holders. Each Holder shall, notwithstanding
                  --------------------------
any termination of this Agreement, severally and not jointly, indemnify and hold
harmless the Company, its directors, officers, agents and employees, each Person
who controls the Company (within the meaning of Section 15 of the Securities Act
and  Section  20  of  the  Exchange Act), and the directors, officers, agents or
employees  of  such  controlling  Persons,  to  the  fullest extent permitted by
applicable  law, from and against all Losses, as incurred, arising solely out of
or  based  solely  upon  any  untrue  or  alleged  untrue  statement  of


                                        9
<PAGE>
a  material fact contained in any Registration Statement, any Prospectus, or any
form of prospectus, or in any amendment or supplement thereto, or arising solely
out  of or based solely upon any omission or alleged omission of a material fact
required  to  be  stated therein or necessary to make the statements therein (in
the  case of any Prospectus, or any form of prospectus or supplement thereto, in
light  of  the  circumstances  under which they were made) not misleading to the
extent,  but  only  to  the extent that, such untrue statements or omissions are
based  solely upon information regarding such Holder furnished in writing to the
Company  by  such  Holder expressly for use therein, or  to the extent that such
information  relates  to  such  Holder  or  such  Holder's  proposed  method  of
distribution  of  Registrable  Securities  and was reviewed and approved by such
Holder expressly for use in the Registration Statement (it being understood that
the  Holder  has  approved  Annex A hereto for this purpose), such Prospectus or
such  form  of  Prospectus  or in any amendment or supplement thereto; provided,
however,  that  the indemnity agreement contained in this Section 5(b) shall not
apply to amounts paid in settlement of any Losses if such settlement is effected
without  the  prior  written  consent  of the Holder, which consent shall not be
unreasonably  withheld.  In  no  event shall the liability of any selling Holder
hereunder  be  greater  in  amount  than  the  dollar amount of the net proceeds
received  by such Holder upon the sale of the Registrable Securities giving rise
to  such  indemnification  obligation.

          (c)     Conduct  of  Indemnification  Proceedings.  If  any Proceeding
                  -----------------------------------------
shall  be brought or asserted against any Person entitled to indemnity hereunder
(an  "Indemnified  Party"),  such  Indemnified  Party  shall promptly notify the
Person  from whom indemnity is sought (the "Indemnifying Party") in writing, and
the  Indemnifying  Party  shall  have  the  right to assume the defense thereof,
including  the  employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all reasonable fees and expenses incurred in connection
with  defense  thereof;  provided,  that the failure of any Indemnified Party to
give  such notice shall not relieve the Indemnifying Party of its obligations or
liabilities  pursuant to this Agreement, except (and only) to the extent that it
shall  be  finally  determined  by  a  court  of  competent  jurisdiction (which
determination  is  not  subject  to  appeal or further review) that such failure
shall  have  proximately  and  materially  adversely prejudiced the Indemnifying
Party.

          An  Indemnified  Party shall have the right to employ separate counsel
in  any  such Proceeding and to participate in the defense thereof, but the fees
and  expenses  of such counsel shall be at the expense of such Indemnified Party
or Parties unless:  (1) the Indemnifying Party has agreed in writing to pay such
fees  and  expenses;  (2)  the  Indemnifying Party shall have failed promptly to
assume  the  defense  of  such  Proceeding  and  to  employ  counsel  reasonably
satisfactory  to such Indemnified Party in any such Proceeding; or (3) the named
parties  to  any  such Proceeding (including any impleaded parties) include both
such  Indemnified  Party  and the Indemnifying Party, and such Indemnified Party
shall  have  been  advised  by  counsel that a conflict of interest is likely to
exist  if  the  same  counsel  were  to represent such Indemnified Party and the
Indemnifying  Party  (in  which  case,  if  such  Indemnified Party notifies the
Indemnifying  Party  in writing that it elects to employ separate counsel at the
expense  of  the  Indemnifying  Party, the Indemnifying Party shall not have the
right  to assume the defense thereof and such counsel shall be at the expense of
the  Indemnifying  Party);  provided,  that  the Indemnifying Party shall not be
liable  for the fees and expenses of more than one separate firm of attorneys at
any  time  for  all  Indemnified  Parties.  The  Indemnifying Party shall not be
liable  for  any  settlement of any such Proceeding effected without its written
consent,  which  consent  shall  not  be  unreasonably  withheld,  delayed  or
conditioned.  No  Indemnifying Party shall, without the prior written consent of
the  Indemnified  Party,  effect  any  settlement  of  any pending Proceeding in
respect  of  which  any  Indemnified  Party  is  a party, unless such settlement
includes  an  unconditional release of such Indemnified Party from all liability
on  claims  that  are  the  subject  matter  of  such  Proceeding.

          All  fees  and expenses of the Indemnified Party (including reasonable
fees  and  expenses  to  the extent incurred in connection with investigating or
preparing  to  defend  such  Proceeding  in  a manner not inconsistent with this
Section)  shall  be  paid  to  the  Indemnified  Party,  as  incurred,  within


                                       10
<PAGE>
twenty  Trading  Days  of  written  notice  thereof  to  the  Indemnifying Party
(regardless  of whether it is ultimately determined that an Indemnified Party is
not entitled to indemnification hereunder; provided, that the Indemnifying Party
may  require  such Indemnified Party to undertake to reimburse all such fees and
expenses to the extent it is finally judicially determined that such Indemnified
Party  is  not  entitled  to  indemnification  hereunder).

          (d)     Contribution.  If  a  claim  for indemnification under Section
                  ------------
5(a)  or 5(b) is unavailable to an Indemnified Party (by reason of public policy
or  otherwise),  then  each  Indemnifying  Party,  in  lieu of indemnifying such
Indemnified  Party,  shall  contribute  to  the  amount  paid or payable by such
Indemnified  Party  as  a  result  of  such  Losses,  in  such  proportion as is
appropriate  to  reflect  the  relative  fault  of  the  Indemnifying  Party and
Indemnified  Party  in connection with the actions, statements or omissions that
resulted  in such Losses as well as any other relevant equitable considerations.
The  relative  fault  of  such Indemnifying Party and Indemnified Party shall be
determined  by reference to, among other things, whether any action in question,
including  any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information  supplied  by, such Indemnifying Party or Indemnified Party, and the
parties'  relative  intent,  knowledge, access to information and opportunity to
correct  or  prevent  such  action,  statement  or omission.  The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 5(c), any reasonable attorneys' or other
reasonable  fees  or  expenses  incurred  by  such  party in connection with any
Proceeding to the extent such party would have been indemnified for such fees or
expenses  if  the  indemnification provided for in this Section was available to
such  party  in  accordance  with  its  terms.

          The  parties  hereto  agree that it would not be just and equitable if
contribution  pursuant  to  this  Section  5(d)  were  determined  by  pro  rata
allocation  or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
net  proceeds  actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder  has  otherwise  been required to pay by reason of such untrue or alleged
untrue  statement  or  omission  or  alleged  omission.  No  person  guilty  of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act)  shall  be entitled to contribution from any Person who was not
guilty  of  such  fraudulent  misrepresentation.

          The  indemnity  and  contribution agreements contained in this Section
are  in  addition to any liability that the Indemnifying Parties may have to the
Indemnified  Parties  and  are  not  in  diminution  or  limitation  of  the
indemnification  provisions  under  the  Purchase  Agreement.

     6.     Miscellaneous
            -------------

          (a)     Remedies.  In  the  event  of  a breach by the Company or by a
                  --------
Holder  of  any  of  their  obligations under this Agreement, each Holder or the
Company,  as  the  case  may  be,  in addition to being entitled to exercise all
rights  granted  by law and under this Agreement, including recovery of damages,
will  be  entitled  to  specific performance of its rights under this Agreement.
The  Company  and  each  Holder  agree  that  monetary damages would not provide
adequate compensation for any losses incurred by reason of a breach by it of any
of the provisions of this Agreement and hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the  defense  that  a  remedy  at  law  would  be  adequate.


                                       11
<PAGE>
          (b)     No  Piggyback  on  Registrations.  Except  and  to  the extent
                  --------------------------------
specified  in Schedule 3.1(x) to the Purchase Agreement, neither the Company nor
              ---------------
any  of  its  security holders (other than the Holders in such capacity pursuant
hereto)  may include securities of the Company in a Registration Statement other
than  the  Registrable  Securities,  and  the  Company  shall  not  prior to the
Effective  Date  enter  into any agreement providing any such right to any of it
security  holders.

          (c)     Entire  Agreement.  This  Agreement is intended by the parties
                  -----------------
as  a  final  expression  of  their  agreement and intended to be a complete and
exclusive  statement of the agreement and understanding of the parties hereto in
respect  of  the subject matter contained herein.  This Agreement supersedes all
prior  agreements  and  understandings  between the parties with respect to such
subject  matter,  except  for,  and  as  provided  in the Transaction Documents.

          (d)     Benefits  of  the Agreement.  The terms and conditions of this
                  ---------------------------
Agreement  shall  inure  to  the  benefit  of and be binding upon the respective
permitted  successors  and  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  assigns  any  rights,  remedies,
obligations,  or  liabilities  under  or  by reason of this Agreement, except as
expressly  provided  in  this  Agreement.

          (e)     Compliance.  Each  Holder  covenants  and  agrees that it will
                  ----------
comply  with  the  prospectus  delivery  requirements  of  the Securities Act as
applicable to it (unless an exemption therefrom is available) in connection with
sales of Registrable Securities pursuant to the Registration Statement and shall
sell the Registrable Securities only in accordance with a method of distribution
described  in  the  Registration  Statement.

          (f)     Discontinued  Disposition.  Each  Holder further agrees by its
                  -------------------------
acquisition  of  such Registrable Securities that, upon receipt of a notice from
the  Company  of  the  occurrence  of any event of the kind described in Section
3(c)(ii)-(v),  such  Holder  will  forthwith  discontinue  disposition  of  such
Registrable  Securities  under the Registration Statement until it is advised in
writing  (the "Advice") by the Company that the use of the applicable Prospectus
may  be  resumed,  and, in either case, has received copies of any additional or
supplemental  filings  that  are  incorporated  or  deemed to be incorporated by
reference in such Prospectus or Registration Statement.  The Company may provide
appropriate  stop  orders  to  enforce  the  provisions  of  this  paragraph.

          (g)     Piggy-Back  Registrations.  If  at  any  time  during  the
                  -------------------------
Effectiveness  Period  there is not an effective Registration Statement covering
all of the Registrable Securities and the Company shall determine to prepare and
file  with  the  Commission a registration statement relating to an offering for
its  own account or the account of others under the Securities Act of any of its
equity securities, other than on Form S-4 or Form S-8 (each as promulgated under
the  Securities  Act) or their then equivalents relating to equity securities to
be issued solely in connection with any acquisition of any entity or business or
equity  securities issuable in connection with stock option or other employee or
director  benefit  plans,  then  the  Company  shall send to each Holder written
notice  of  such determination and, if within fifteen days after receipt of such
notice,  any  such Holder shall so request in writing, the Company shall include
in  such  registration  statement all or any part of such Registrable Securities
such holder requests to be registered, subject to customary underwriter cutbacks
applicable  to all holders of registration rights on a pro rata basis; provided,
that if at any time after giving written notice of its intention to register any
securities  and  prior to the effective date of the registration statement filed
in connection with such registration, the Company shall determine for any reason
not to register or to delay registration of such securities, the Company may, at
its  election,  give  written  notice  of such determination to such Holder and,
thereupon, (i) in the case of a determination not to register, shall be relieved
of  its  obligation  to  register  any  Registrable  Securities pursuant to this
Section  6(g)  in connection with such registration (but not from its obligation
to  pay expenses in accordance with Section 4 hereof), and (ii) in the case of a
determination  to  delay


                                       12
<PAGE>
registering,  shall be permitted to delay registering any Registrable Securities
being  registered pursuant to this Section 6(g) for the same period as the delay
in  registering  such  other  securities.

          (h)     Amendments and Waivers.  This Agreement may be amended only by
                  ----------------------
a  writing signed by all of the parties hereto.  The Company may take any action
herein prohibited, or omit to perform any act herein required to be performed by
it,  only  if  the  Company  shall  have  obtained  the  written consent to such
amendment,  action or omission to act, of each Purchaser. No consideration shall
be offered or paid to any Holder to amend or consent to a waiver or modification
of any provision of this Agreement unless the same consideration also is offered
to  all  of  the  Holders.  Failure of any party to exercise any right or remedy
under  this  Agreement or otherwise or delay by a party in exercising such right
or  remedy  shall  not  operate  as  a  waiver  thereof.

          (i)     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  number  specified  in  this Section prior to 5:00 p.m. (New York City
time)  on  a  Trading  Day,  (ii)  the  next  Trading  Day  after  the  date  of
transmission,  if  such  notice  or  communication is delivered via facsimile or
e-mail  to the facsimile number or e-mail addressed specified in this Section on
a  day that is not a Trading Day or later than 5:00 p.m. (New York City time) on
any  Trading  Day, (iii) the Business Day following the date of mailing, if sent
by  nationally  recognized  overnight  courier  service  with  next day delivery
specified,  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:          DigitalFX International, Inc.
                              3035 East Patrick Lane, Suite 9
                              Las Vegas, NV 89120
                              Facsimile:
                              Attn:

    With a copy to:           Stubbs Alderton & Markiles, LLP
                              15260 Ventura Boulevard, 20th Floor
                              Sherman Oaks, CA 91403
                              Facsimile: (818) 444-4520
                              Attn: Greg Akselrud

                              Jackson L. Morris, Esq
                              3116 West North A Street
                              Tampa, FL 33609-1544
                              Facsimile: 800-310-1695

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

    If to any other Person    To the address of such Holder as it
    who is then the           appears in the stock transfer books of the
    registered Holder:


                                       13
<PAGE>
                              Company or such other address as may
                              be designated in writing hereafter, in the
                              same manner, by such Person.

provided, that any party may change its address for notices by providing written
notice to the other parties in the manner prescribed by this Section.

          (j)     Successors  and  Assigns.  This  Agreement  shall inure to the
                  ------------------------
benefit  of  and be binding upon the successors and permitted assigns of each of
the  parties and shall inure to the benefit of each Holder.  The Company may not
assign  its rights or obligations hereunder without the prior written consent of
each  Holder.  The  rights of the Holders hereunder, including the right to have
the  Company  register Registrable Securities pursuant to this Agreement, may be
assigned by each Holder to transferees or assignees of all or any portion of the
Registrable  Securities,  but  only if (i) the Holder agrees in writing with the
transferee  or  assignee  to assign such rights, and a copy of such agreement is
furnished  to  the  Company within a reasonable time after such assignment, (ii)
the  Company  is,  within  a  reasonable time after such transfer or assignment,
furnished  with  written  notice  of  the name and address of such transferee or
assignee  and  the securities with respect to which such registration rights are
being  transferred or assigned, (iii) at or before the time the Company received
the  written notice contemplated by clause (ii) of this sentence, the transferee
or  assignee  agrees  in  writing  with  the  Company  to be bound by all of the
provisions contained herein and (iv) the transferee is an "accredited investor,"
as  that  term  is  defined  in  Rule  501  of  Regulation  D.

          (k)     Execution and Counterparts.  This Agreement may be executed in
                  --------------------------
any number of counterparts, each of which when so executed shall be deemed to be
an  original  and, all of which taken together shall constitute one and the same
Agreement.  In  the  event  that  any  signature  is  delivered  by  facsimile
transmission,  such  signature  shall  create  a valid binding obligation of the
party  executing  (or  on whose behalf such signature is executed) the same with
the  same  force  and  effect  as  if such facsimile signature were the original
thereof.

          (l)     Governing  Law.  All  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  agrees  that  all Proceedings concerning the interpretations, enforcement
and  defense of the transactions contemplated by this Agreement (whether brought
against  a  party hereto or its respective Affiliates, employees or agents) will
be  commenced  in  the  New  York  Courts.  Each party hereto hereby irrevocably
submits  to  the  exclusive  jurisdiction  of  the  New  York  Courts  for  the
adjudication  of  any  dispute  hereunder  or in connection herewith or with any
transaction  contemplated  hereby  or  discussed  herein, and hereby irrevocably
waives,  and  agrees  not  to assert in any Proceeding, any claim that it is not
personally  subject  to  the  jurisdiction  of  any New York Court, or that such
Proceeding  has been commenced in an improper or inconvenient forum.  Each party
hereto  hereby  irrevocably  waives  personal service of process and consents to
process  being  served  in  any  such  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.  Each
party  hereto  hereby  irrevocably  waives,  to  the fullest extent permitted by
applicable law, any and all right to trial by jury in any Proceeding arising out
of  or  relating  to this Agreement or the transactions contemplated hereby.  If
any  party  shall  commence  a  Proceeding  to  enforce  any  provisions of this
Agreement,  then  the prevailing party in such Proceeding shall be reimbursed by
the  other  parties  for  its


                                       14
<PAGE>
attorneys'  fees  and  other costs and expenses incurred with the investigation,
preparation  and  prosecution  of  such  Proceeding.

          (m)     Cumulative  Remedies.  The  remedies  provided  herein  are
                  --------------------
cumulative  and  not  exclusive  of  any  remedies  provided  by  law.

          (n)     Severability.  If any term, provision, covenant or restriction
                  ------------
of  this  Agreement  is held by a court of competent jurisdiction to be invalid,
illegal,  void  or  unenforceable,  the  remainder  of  the  terms,  provisions,
covenants  and  restrictions  set  forth  herein  shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto  shall  use  their  reasonable  efforts to find and employ an alternative
means  to achieve the same or substantially the same result as that contemplated
by  such  term, provision, covenant or restriction.  It is hereby stipulated and
declared  to  be  the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such  that  may  be  hereafter declared invalid, illegal, void or unenforceable.

          (o)     Headings.  The  headings in this Agreement are for convenience
                  --------
of  reference  only  and shall not limit or otherwise affect the meaning hereof.

          (p)     Independent Nature of Purchasers' Obligations and Rights.  The
                  --------------------------------------------------------
obligations  of  each  Purchaser  under this Agreement are several and not joint
with the obligations of any other Purchaser hereunder, and no Purchaser shall be
responsible  in  any  way  for  the  performance of the obligations of any other
Purchaser  hereunder.  The  decision  of  each  Purchaser to purchase Securities
pursuant  to  the Transaction Documents has been made independently of any other
Purchaser.  Nothing  contained  herein  or  in  any  other agreement or document
delivered  at  any closing, and no action taken by any Purchaser pursuant hereto
or  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 this Agreement.  Each
Purchaser  acknowledges  that  no  other  Purchaser  has acted as agent for such
Purchaser  in  connection  with  making  its  investment  hereunder  and that no
Purchaser  will  be  acting  as  agent  of  such  Purchaser  in  connection with
monitoring  its  investment  in the Securities or enforcing its rights under the
Transaction  Documents.  Each Purchaser shall be entitled to protect and enforce
its  rights,  including,  without  limitation,  the  rights  arising out of this
Agreement, and it shall not be necessary for any other Purchaser to be joined as
an  additional  party  in  any  Proceeding  for  such  purpose.  The  Company
acknowledges  that  each  of  the  Purchasers  has  been  provided with the same
Registration  Rights  Agreement  for  the  purpose of closing a transaction with
multiple Purchasers and not because it was required or requested to do so by any
Purchaser.

          (q)     Currency.     Unless  otherwise  indicated, all dollar amounts
                  --------
referred  to  in this Agreement are in United States Dollars.  All amounts owing
under  this  Agreement are in United States Dollars.  All amounts denominated in
other  currencies  shall  be  converted  in  the United States dollar equivalent
amount  in accordance with the applicable exchange rate in effect on the date of
calculation.

          (r)     Further Assurances.  The parties shall execute and deliver all
                  ------------------
such  further  instruments  and documents and take all such other actions as may
reasonably  be required to carry out the transactions contemplated hereby and to
evidence  the  fulfillment  of  the  agreements  herein  contained.


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                           SIGNATURE PAGES TO FOLLOW]


                                       15
<PAGE>
          IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement  as  of  the  date  first  written  above.

                                        DIGITALFX INTERNATIONAL, INC.


                                        By:  /s/ Lorne Walker
                                           --------------------------------
                                           Name: Lorne Walker
                                           Title: Chief Financial Officer


                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                      SIGNATURE PAGES OF HOLDERS TO FOLLOW]


<PAGE>
          IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.

                                        KINGDON ASSOCIATES

                                        By: Kingdon Capital Management, LLC

                                        By:  /s/ Alfred Barbagalo
                                           --------------------------------
                                        Name: Alfred Barbagalo
                                        Title: General Counsel

                                        Address for Notice:


                                        KINGDON FAMILY PARTNERSHIP, L.P.

                                        By: Kingdon Capital Management, LLC

                                        By:  /s/ Alfred Barbagalo
                                           --------------------------------
                                        Name: Alfred Barbagalo
                                        Title: General Counsel

                                        Address for Notice:


                                        M. KINGDON OFFSHORE LTD.

                                        By: Kingdon Capital Management, LLC

                                        By:  /s/ Alfred Barbagalo
                                           --------------------------------
                                        Name: Alfred Barbagalo
                                        Title: General Counsel

                                        Address for Notice:


                                       2
<PAGE>
                                                                         Annex A
                              PLAN OF DISTRIBUTION

     We  are  registering  the  shares  of  Common  Stock  issued to the selling
shareholders to permit the resale of these shares of Common Stock by the holders
of  the  shares  of  Common  Stock  from  time  to  time  after the date of this
prospectus.  We  will  not  receive  any  of  the  proceeds from the sale by the
selling  shareholders  of the shares of Common Stock.  We will bear all fees and
expenses  incident  to  our  obligation  to register the shares of Common Stock.

     The  selling shareholders may sell all or a portion of the shares of Common
Stock  beneficially  owned by them and offered hereby from time to time directly
or through one or more underwriters, broker-dealers or agents.  If the shares of
Common  Stock  are  sold  through  underwriters  or  broker-dealers, the selling
shareholders  will  be  responsible for underwriting discounts or commissions or
agent's  commissions.  The  shares  of  Common  Stock may be sold in one or more
transactions  at  fixed  prices,  at prevailing market prices at the time of the
sale, at varying prices determined at the time of sale, or at negotiated prices.
These  sales may be effected in transactions, which may involve crosses or block
transactions.  The Selling Stockholders may use any one or more of the following
methods  when  selling  shares:

-    on any  national  securities  exchange  or  quotation  service on which the
     securities  may  be  listed  or  quoted  at  the  time  of  sale;

-    in the  over-the-counter  market;

-    in transactions  otherwise  than  on  these  exchanges or systems or in the
     over-the-counter  market;

-    through  the  writing  of  options,  whether  such options are listed on an
     options  exchange  or  otherwise;

-    ordinary brokerage transactions and transactions in which the broker-dealer
     solicits  purchasers;

-    block trades  in which the broker-dealer will attempt to sell the shares as
     agent  but  may  position and resell a portion of the block as principal to
     facilitate  the  transaction;

-    purchases  by  a broker-dealer as principal and resale by the broker-dealer
     for  its  account;

-    an exchange  distribution  in  accordance  with the rules of the applicable
     exchange;

-    privately  negotiated  transactions;

-    short sales;

-    broker-dealers  may  agree  with  the  selling  securityholders  to  sell a
     specified  number  of  such  shares  at  a  stipulated  price  per  share;

-    a combination  of  any  such  methods  of  sale;  and

-    any other  method  permitted  pursuant  to  applicable  law.

     The  selling  stockholders  may  also  sell shares under Rule 144 under the
Securities  Act,  if  available,  rather  than  under  this  prospectus.


                                       3
<PAGE>
     Broker-dealers  engaged  by  the selling stockholders may arrange for other
brokers-dealers to participate in sales. If the selling shareholders effect such
transactions  by  selling  shares  of  Common  Stock to or through underwriters,
broker-dealers  or  agents,  such  underwriters,  broker-dealers  or  agents may
receive  commissions  in  the form of discounts, concessions or commissions from
the  selling shareholders or commissions from purchasers of the shares of Common
Stock  for whom they may act as agent or to whom they may sell as principal. The
selling  stockholders  do not expect these discounts, commissions or concessions
to  exceed  what  is  customary  in  the  types  of  transactions  involved

     In  connection  with  sales of the shares of Common Stock or otherwise, the
selling  shareholders may enter into hedging transactions with broker-dealers or
other  financial  institutions,  which  may in turn engage in short sales of the
shares  of  Common Stock in the course of hedging in positions they assume.  The
selling  shareholders  may  also  sell  shares of Common Stock short and if such
short  sale  shall take place after the date that this Registration Statement is
declared  effective  by  the  Commission,  the  selling stockholders may deliver
shares  of  Common Stock covered by this prospectus to close out short positions
and  to return borrowed shares in connection with such short sales.  The selling
shareholders  may  also  loan or pledge shares of Common Stock to broker-dealers
that  in turn may sell such shares. The selling stockholders may also enter into
option or other transactions with broker-dealers or other financial institutions
or  the creation of one or more derivative securities which require the delivery
to  such  broker-dealer or other financial institution of shares offered by this
prospectus,  which  shares such broker-dealer or other financial institution may
resell  pursuant  to this prospectus (as supplemented or amended to reflect such
transaction).

     The selling shareholders may pledge or grant a security interest in some or
all  of  the  shares  of  Common Stock owned by them and, if they default in the
performance  of  their  secured obligations, the pledgees or secured parties may
offer  and  sell  the  shares of Common Stock from time to time pursuant to this
prospectus  or  any  amendment  to this prospectus under Rule 424(b)(3) or other
applicable  provision  of  the  Securities Act of 1933, as amended, amending, if
necessary,  the  list of selling shareholders to include the pledgee, transferee
or  other  successors in interest as selling shareholders under this prospectus.
The selling shareholders also may transfer and donate the shares of Common Stock
in  other circumstances in which case the transferees, donees, pledgees or other
successors  in  interest  will  be the selling beneficial owners for purposes of
this  prospectus.

     The  selling  shareholders  and  any  broker-dealer  participating  in  the
distribution  of  the  shares of Common Stock may be deemed to be "underwriters"
within  the  meaning  of  the  Securities  Act,  and any commission paid, or any
discounts  or concessions allowed to, any such broker-dealer may be deemed to be
underwriting  commissions  or discounts under the Securities Act.  At the time a
particular  offering  of  the  shares  of  Common  Stock  is  made, a prospectus
supplement,  if  required, will be distributed which will set forth (i) the name
of each such selling stockholder and of the participating broker-dealer(s), (ii)
the  number  of  shares  involved,  (iii)  the price at which such the shares of
Common  Stock  were  sold, (iv) the commissions paid or discounts or concessions
allowed  to  such  broker-dealer(s),  where  applicable,  (v)  that  such
broker-dealer(s) did not conduct any investigation to verify the information set
out  or  incorporated  by  reference  in  this  prospectus, and (vi) other facts
material  to  the  transaction.  In addition, upon the Company being notified in
writing  by  a  Selling Stockholder that a donee or pledgee intends to sell more
than  500  shares of Common Stock, a supplement to this prospectus will be filed
if  then  required  in  accordance  with  applicable  securities  law.

     Under the securities laws of some states, the shares of Common Stock may be
sold  in such states only through registered or licensed brokers or dealers.  In
addition,  in some states the shares of Common Stock may not be sold unless such
shares  have been registered or qualified for sale in such state or an exemption
from  registration  or  qualification  is  available  and  is  complied  with.

     There can be no assurance that any selling shareholder will sell any or all
of  the  shares  of  Common  Stock registered pursuant to the shelf registration
statement,  of  which  this  prospectus  forms  a  part.


                                       4
<PAGE>
     The  selling  shareholders  and  any  other  person  participating  in such
distribution will be subject to applicable provisions of the Securities Exchange
Act  of  1934,  as amended, and the rules and regulations thereunder, including,
without limitation, Regulation M of the Exchange Act, which may limit the timing
of  purchases  and  sales  of  any  of the shares of Common Stock by the selling
shareholders and any other participating person.  Regulation M may also restrict
the  ability  of  any person engaged in the distribution of the shares of Common
Stock to engage in market-making activities with respect to the shares of Common
Stock.  All  of  the  foregoing  may  affect  the marketability of the shares of
Common  Stock and the ability of any person or entity to engage in market-making
activities  with  respect  to  the  shares  of  Common  Stock.

     We  will pay all expenses of the registration of the shares of Common Stock
pursuant  to  the  registration rights agreement, including, without limitation,
Securities  and  Exchange Commission filing fees and expenses of compliance with
state  securities  or  "blue  sky"  laws;  provided,  however,  that  a  selling
shareholder  will pay all underwriting discounts and selling commissions, if any
and  any  related  legal expenses incurred by it.  We will indemnify the selling
shareholders  against  liabilities,  including  some  liabilities  under  the
Securities  Act,  in  accordance with the registration rights agreements, or the
selling shareholders will be entitled to contribution.  We may be indemnified by
the  selling shareholders against civil liabilities, including liabilities under
the  Securities Act, that may arise from any written information furnished to us
by  the  selling  shareholder  specifically  for  use  in  this  prospectus,  in
accordance  with  the  related  registration  rights  agreements,  or  we may be
entitled  to  contribution.


                                       5