<PAGE>
                                                                    EXHIBIT 10.4


                          SECURITIES PURCHASE AGREEMENT

        THIS SECURITIES PURCHASE AGREEMENT (this "Agreement"), dated as of July
___, 2001, by and among BLAGMAN MEDIA INTERNATIONAL INC., a Nevada corporation,
with headquarters located at 1901 Avenue of the Stars, Suite 1710, Los Angeles,
CA 90067 (the "Company"), and the Buyers listed on Schedule I attached hereto
(individually, a "Buyer" or collectively "Buyers").

                                   WITNESSETH:

        WHEREAS, the Company and the Buyer(s) are executing and delivering this
Agreement in reliance upon an exemption from securities registration pursuant to
Section 4(2) and/or Rule 506 of Regulation D ("Regulation D") as promulgated by
the U.S. Securities and Exchange Commission (the "SEC") under the Securities Act
of 1933, as amended (the "1933 Act");

        WHEREAS, the Company has authorized the following new series of its
preferred stock, no par value per share (the "Preferred Stock"): the Company's
Series B Convertible Preferred Stock, par value $0.001 per share (the "Series B
Preferred Shares"), which shall be convertible into shares of the Company's
Common Stock, par value $0.001 per share (the "Common Stock") (as converted, the
"Conversion Shares"), in accordance with the terms of the Company's Certificate
of Designations Designating the Series B Preferred Shares, substantially in the
form attached hereto as Exhibit A (the "Certificate of Designations");

        WHEREAS, the Buyers wish to purchase, upon the terms and conditions
stated in this Agreement, an aggregate of 100 Series B Preferred Shares in the
respective amounts set forth opposite each Buyer's name on Schedule I and at a
purchase price of $10,000 per Series B Preferred Share (the "Purchase Price");
and

        WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the parties hereto are executing and delivering a Registration Rights
Agreement substantially in the form attached hereto as Exhibit B (the "Investor
Registration Rights Agreement") pursuant to which the Company has agreed to
provide certain registration rights under the 1933 Act and the rules and
regulations promulgated thereunder, and applicable state securities laws; and

        WHEREAS, the Series B Preferred Shares are being offered through The May
Davis Group, Inc. (the "Placement Agent"), as the Company's exclusive placement
agent for the offering; and

        WHEREAS, the aggregate proceeds of the sale of the Series B Preferred
Shares contemplated hereby shall be held in escrow pursuant to the terms of an
escrow agreement substantially in the form of the Escrow Agreement attached
hereto as Exhibit C.


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        NOW, THEREFORE, in consideration of the mutual covenants and other
agreements contained in this Agreement the Company and the Buyer(s) hereby agree
as follows:


        1. PURCHASE AND SALE OF SERIES B PREFERRED SHARES.

                (a) Purchase of Series B Preferred Shares. Subject to the
        satisfaction (or waiver) of the terms and conditions of this Agreement,
        each Buyer agrees, severally and not jointly, to purchase at Closing (as
        defined herein below) and the Company agrees to sell and issue to each
        Buyer, severally and not jointly, at Closing, Series B Preferred Shares
        in amounts corresponding with the Subscription Amount set forth opposite
        each Buyer's name on Schedule I hereto. Upon execution hereof by a
        Buyer, the Buyer shall wire transfer the Subscription Amount set forth
        opposite his name on Schedule I in same-day funds or a check payable to
        "First Union National Bank, as Escrow Agent for Blagman Media
        International Inc./The May Davis Group, Inc.", which Subscription Amount
        shall be held in escrow pursuant to the terms of the Escrow Agreement
        (as hereinafter defined) and disbursed in accordance therewith.
        Notwithstanding the foregoing, a Buyer may withdraw his Subscription
        Amount and terminate this Agreement as to such Buyer at any time after
        the execution hereof and prior to Closing (as hereinafter defined).

                (b) Closing Date. The closing of the purchase and sale of the
        Series B Preferred Shares (the "Closing") shall take place at 10:00 a.m.
        Eastern Standard Time on the fifth (5th) business day ("Closing Date")
        following the date hereof, subject to notification of satisfaction (or
        waiver) of the conditions to the Closing set forth in Sections 6 and 7
        below (or such later date as is mutually agreed to by the Company and
        the Buyers). The Closing shall occur on the Closing Date at the offices
        of Butler Gonzalez, LLP, 1000 Stuyvesant Avenue, Suite 6, Union, NJ
        07083 (or such other place as is mutually agreed to by the Company and
        the Buyers).

                (c) Escrow Arrangements; Form of Payment. Upon execution hereof
        by Buyer(s) and pending Closing, the aggregate proceeds of the sale of
        the Series B Preferred Shares to Buyer(s) pursuant hereto, plus the fees
        and expenses of the Placement Agent, shall be deposited in a
        non-interest bearing escrow account with First Union National Bank, as
        escrow agent ("Escrow Agent"), pursuant to the terms of an escrow
        agreement between the Company, the Placement Agent and the Escrow Agent
        in the form attached hereto as Exhibit C (the "Escrow Agreement").
        Subject to the satisfaction of the terms and conditions of this
        Agreement, on the Closing Date, (i) the Escrow Agent shall deliver to
        the Company in accordance with the terms of the Escrow Agreement such
        aggregate gross proceeds for the Series B Preferred Shares to be issued
        and sold to such Buyer(s) at the Closing minus the fees and expenses of
        the Placement Agent, by wire transfer of immediately available funds in
        accordance with the Company's written wire instructions, and (ii) the
        Company shall deliver to each Buyer, Series B Preferred Shares which
        such Buyer(s) is purchasing in amounts indicated opposite such Buyer's
        name on Schedule I, duly executed on behalf of the Company.



                                       2
<PAGE>

        2. BUYER'S REPRESENTATIONS AND WARRANTIES.

                Each Buyer represents and warrants, severally and not jointly,
that:

                (a) Investment Purpose. Each Buyer is acquiring the Series B
        Preferred Shares and, upon conversion of Series B Preferred Shares , the
        Buyer will acquire the Conversion Shares then issuable for its own
        account for investment only and not with a view towards, or for resale
        in connection with, the public sale or distribution thereof, except
        pursuant to sales registered or exempted under the 1933 Act; provided,
        however, that by making the representations herein, such Buyer reserves
        the right to dispose of the Conversion Shares at any time in accordance
        with or pursuant to an effective registration statement covering such
        Conversion Shares or an available exemption under the 1933 Act.

                (b) Accredited Investor Status. Each Buyer is an "Accredited
        Investor" as that term is defined in Rule 501(a)(3) of Regulation D.

                (c) Reliance on Exemptions. Each Buyer understands that the
        Series B Preferred Shares are being offered and sold to it in reliance
        on specific exemptions from the registration requirements of United
        States federal and state securities laws and that the Company is relying
        in part upon the truth and accuracy of, and such Buyer's compliance
        with, the representations, warranties, agreements, acknowledgments and
        understandings of such Buyer set forth herein in order to determine the
        availability of such exemptions and the eligibility of such Buyer to
        acquire such securities.

                (d) Information. Each Buyer and its advisors (and his or its
        counsel), if any, have been furnished with all materials relating to the
        business, finances and operations of the Company and information he
        deemed material to making an informed investment decision regarding his
        purchase of the Series B Preferred Shares and the Conversion Shares,
        which have been requested by such Buyer. Each Buyer and its advisors, if
        any, have been afforded the opportunity to ask questions of the Company
        and its management. Neither such inquiries nor any other due diligence
        investigations conducted by such Buyer or its advisors, if any, or its
        representatives shall modify, amend or affect such Buyer's right to rely
        on the Company's representations and warranties contained in Section 3
        below. Each Buyer understands that its investment in the Series B
        Preferred Shares and the Conversion Shares involves a high degree of
        risk. Each Buyer is in a position regarding the Company, which, based
        upon employment, family relationship or economic bargaining power,
        enabled and enables such Buyer to obtain information from the Company in
        order to evaluate the merits and risks of this investment. Each Buyer
        has sought such accounting, legal and tax advice, as it has considered
        necessary to make an informed investment decision with respect to its
        acquisition of the Series B Preferred Shares and the Conversion Shares.

                (e) No Governmental Review. Each Buyer understands that no
        United States federal or state agency or any other government or
        governmental agency has passed on or



                                       3
<PAGE>

        made any recommendation or endorsement of the Series B Preferred Shares
        or the Conversion Shares, or the fairness or suitability of the
        investment in the Series B Preferred Shares or the Conversion Shares,
        nor have such authorities passed upon or endorsed the merits of the
        offering of the Series B Preferred Shares or the Conversion Shares.

                (f) Transfer or Resale. Each Buyer understands that except as
        provided in the Registration Rights Agreement: (i) the Series B
        Preferred Shares have not been and are not being registered under the
        1933 Act or any state securities laws, and may not be offered for sale,
        sold, assigned or transferred unless (A) subsequently registered
        thereunder, or (B) such Buyer shall have delivered to the Company an
        opinion of counsel, in a generally acceptable form, to the effect that
        such securities to be sold, assigned or transferred may be sold,
        assigned or transferred pursuant to an exemption from such registration
        requirements; (ii) any sale of such securities made in reliance on Rule
        144 under the 1933 Act (or a successor rule thereto) ("Rule 144") may be
        made only in accordance with the terms of Rule 144 and further, if Rule
        144 is not applicable, any resale of such securities under circumstances
        in which the seller (or the person through whom the sale is made) may be
        deemed to be an underwriter (as that term is defined in the 1933 Act)
        may require compliance with some other exemption under the 1933 Act or
        the rules and regulations of the SEC thereunder; and (iii) neither the
        Company nor any other person is under any obligation to register such
        securities under the 1933 Act or any state securities laws or to comply
        with the terms and conditions of any exemption thereunder. The Company
        reserves the right to place stop transfer instructions against the
        shares and certificates for the Conversion Shares.

                (g) Legends. Each Buyer understands that the certificates or
        other instruments representing the Series B Preferred Shares and or the
        Conversion Shares shall bear a restrictive legend in substantially the
        following form (and a stop transfer order may be placed against transfer
        of such stock certificates):

                THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
                REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
                APPLICABLE STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN
                ACQUIRED SOLELY FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
                TOWARD RESALE AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
                OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
                STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933,
                AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, OR AN OPINION
                OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS
                NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS.



                                       4
<PAGE>

        The legend set forth above shall be removed and the Company shall issue
        a certificate without such legend to the holder of the Conversion Shares
        upon which it is stamped, if, unless otherwise required by state
        securities laws, (i) in connection with a sale transaction, provided the
        Conversion Shares are registered under the 1933 Act or (ii) in
        connection with a sale transaction, such holder provides the Company
        with an opinion of counsel, in form acceptable to the Company and its
        counsel, to the effect that a public sale, assignment or transfer of the
        Conversion Shares may be made without registration under the 1933 Act.

                (h) Authorization, Enforcement. This Agreement has been duly and
        validly authorized, executed and delivered on behalf of such Buyer and
        is a valid and binding agreement of such Buyer enforceable in accordance
        with its terms, except as such enforceability may be limited by general
        principles of equity or applicable bankruptcy, insolvency,
        reorganization, moratorium, liquidation and other similar laws relating
        to, or affecting generally, the enforcement of applicable creditors'
        rights and remedies.

                (i) Receipt of Documents. Each Buyer and his or its counsel has
        received and read in their entirety: (i) this Agreement and each
        representation, warranty and covenant set forth herein, the Investor
        Registration Rights Agreement, and the Escrow Agreement; (ii) all due
        diligence and other information necessary to verify the accuracy and
        completeness of such representations, warranties and covenants; (iii)
        the Company's Form 10-KSB, as amended,for the fiscal year ended
        September 30, 2000; (iv) the Company's Form 10-QSB for the fiscal
        quarter ended December 31, 2000 and March 2001; and (v) answers to all
        questions the Buyer submitted to the Company regarding an investment in
        the Company; and the Buyer has relied on the information contained
        therein and has not been furnished any other documents, literature,
        memorandum or prospectus.

                (j) Due Formation of Corporate and Other Buyers. If the Buyer(s)
        is a corporation, trust, partnership or other entity that is not an
        individual person, it has been formed and validly exists and has not
        been organized for the specific purpose of purchasing the Series B
        Preferred Shares and is not prohibited from doing so.

                (k) Due Authorization of Fiduciary Buyers. If the Buyer(s) is
        purchasing the Series B Preferred Shares in a fiduciary capacity for
        another person or entity, including, without limitation, a corporation,
        partnership, trust or any other entity, the Buyer(s) has been duly
        authorized and empowered to execute this Agreement and such other person
        fulfills all the requirements for purchase of the Series B Preferred
        Shares and agrees to be bound by the obligations, representations,
        warranties, and covenants contained herein. Upon request of the Company,
        the Buyer(s) will provide true, complete and current copies of all
        relevant documents creating the Buyers, authorizing its investment in
        the Company and/or evidencing the satisfaction of the foregoing.

                (l) Further Representations by Foreign Buyers. If the Buyer(s)
        is not a U.S. Person (as defined below), such Buyer hereby represents
        that such Buyer(s) is satisfied as to full observance of the laws of
        such Buyer's jurisdiction in connection with any



                                       5
<PAGE>

        invitation to subscribe for the securities or any use of this Agreement,
        including: (i) the legal requirements of such Buyer's jurisdiction for
        the purchase of the securities, (ii) any foreign exchange restrictions
        applicable to such purchase, (iii) any governmental or other consents
        that may need to be obtained, and (iv) the income tax and other tax
        consequences, if any, which may be relevant to the purchase, holding,
        redemption, sale, or transfer of the securities. Such Buyer's
        subscription and payment for, and such Buyer's continued beneficial
        ownership of, the securities will not violate any applicable securities
        or other laws of such Buyer's jurisdiction. The term "U.S. Person" as
        used herein shall mean any person who is a citizen or resident of the
        United States or Canada, or any state, territory or possession thereof,
        including, but not limited to, any estate of any such person, or any
        corporation, partnership, trust or other entity created or existing
        under the laws thereof, or any entity controlled or owned by any of the
        foregoing.

                (m) No Legal Advice From the Company. Each Buyer acknowledges,
        that it had the opportunity to review this Agreement and the
        transactions contemplated by this Agreement with his or its own legal
        counsel and investment and tax advisors. Each Buyer is relying solely on
        such counsel and advisors and not on any statements or representations
        of the Company or any of its representatives or agents for legal, tax or
        investment advice with respect to this investment, the transactions
        contemplated by this Agreement or the securities laws of any
        jurisdiction.

                (n) No General Solicitation. Neither the Buyers, nor any of its
        affiliates, nor any person acting on its or their behalf, has engaged in
        any form of general solicitation or general advertising (within the
        meaning of Regulation D under the 1933 Act) in connection with the offer
        or sale of the Series B Preferred Shares or the Conversion Shares.

        3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

        The Company represents and warrants to each of the Buyers that:

                (a) Organization and Qualification. The Company and its
        subsidiaries are corporations duly organized and validly existing in
        good standing under the laws of the jurisdiction in which they are
        incorporated, and have the requisite corporate power to own their
        properties and to carry on their business as now being conducted. The
        Company is not qualified as a foreign corporation in California due to
        name restrictions, however, it's subsidiary is duly qualified as a
        foreign corporation to do business and is in good standing in every
        jurisdiction in which the nature of the business conducted by it makes
        such qualification necessary, except to the extent that the failure to
        be so qualified or be in good standing would not have a material adverse
        effect on the Company and its subsidiaries taken as a whole. The Company
        has provided to the Buyers copies of all material documents related to
        the transactions with Unisat Inc., and MNS Eagle Equity Group I Inc.
        (the "Reorganization")



                                       6
<PAGE>

                (b) Authorization, Enforcement, Compliance with Other
        Instruments. (i) The Company has the requisite corporate power and
        authority to enter into and perform this Agreement, the Investor
        Registration Rights Agreement and any related agreements, and to issue
        the Series B Preferred Shares and the Conversion Shares in accordance
        with the terms hereof and thereof, (ii) the execution and delivery of
        this Agreement, the Registration Rights Agreement and any related
        agreements by the Company and the consummation by it of the transactions
        contemplated hereby and thereby, including, without limitation, the
        issuance of the Series B Preferred Shares the Conversion Shares and the
        reservation for issuance and the issuance of the Conversion Shares
        issuable upon conversion or exercise thereof, have been duly authorized
        by the Company's Board of Directors and no further consent or
        authorization is required by the Company, its Board of Directors or its
        stockholders, (iii) this Agreement and the Investor Registration Rights
        Agreement and any related agreements have been duly executed and
        delivered by the Company, (iv) this Agreement, the Investor Registration
        Rights Agreement and any related agreements constitute the valid and
        binding obligations of the Company enforceable against the Company in
        accordance with their terms, except as such enforceability may be
        limited by general principles of equity or applicable bankruptcy,
        insolvency, reorganization, moratorium, liquidation or similar laws
        relating to, or affecting generally, the enforcement of creditors'
        rights and remedies and (v) prior to the Closing Date, the Certificate
        of Designations substantially in the form attached hereto as Exhibit A
        has been filed with the Secretary of State of the State of Nevada and
        will be in full force and effect, enforceable against the Company in
        accordance with its terms.

                (c) Capitalization. The authorized capital stock of the Company
        consists of 100,000,000 shares of Common Stock $0.001 par value, and
        100,000,000 shares of Preferred Stock, $0.0011 par value. As of July
        23, 2001, the Company had 62,167,450 shares of Common Stock outstanding
        excluding 60,000 shares of Common Stock in its treasury which are being
        cancelled, the Company filed a Certificate of Designations authorizing
        600,000 shares of Series B Convertible Redeemable Preferred Stock par
        value $0.001 per share (the "Series B Stock") in connection with a
        proposed transaction with Mulligan Media and Communications Ltd. Such
        transaction was not consummated and no shares of the Series A Stock were
        issued in connection therewith. There are no shares of Preferred Stock
        issued and outstanding except for the transactions of the reorganized
        entities preceding the Reorganizations, for which the Company has relied
        on third party representations, all of such outstanding shares have been
        validly issued and are fully paid and nonassessable. Except as disclosed
        in the SEC Documents (as defined in Section 3(f)) as amended, no shares
        of Common Stock are subject to preemptive rights or any other similar
        rights or any liens or encumbrances suffered or permitted by the
        Company. Except as disclosed in the SEC Document, as of the date of
        this Agreement, (i) there are no outstanding options, warrants, rights
        to subscribe to, calls or commitments of any character whatsoever
        relating to, or securities or rights convertible into, any shares of
        capital stock of the Company or any of its subsidiaries, or contracts,
        commitments, understandings 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 or options,
        warrants, scrip, rights to subscribe to, calls or commitments of



                                       7
<PAGE>

        any character whatsoever relating to, or securities or rights
        convertible into, any shares of capital stock of the Company or any of
        its subsidiaries, (ii) there are no outstanding debt securities and
        (iii) there are no agreements or arrangements under which the Company or
        any of its subsidiaries is obligated to register the sale of any of
        their securities under the 1933 Act (except pursuant to the Registration
        Rights Agreement). There are no securities or instruments containing
        anti-dilution or similar provisions that will be triggered by the
        issuance of the Series B Preferred Shares as described in this
        Agreement. The Company has furnished to the Buyer true and correct
        copies of the Company's Certificate of Incorporation, as amended and as
        in effect on the date hereof (the "Certificate of Incorporation"), the
        Company's By-laws, as in effect on the date hereof (the "By-laws"), and
        the terms of all securities convertible into or exercisable for Common
        Stock and the material rights of the holders thereof in respect thereto
        other than stock options issued to employees and consultants.

                (d) Issuance of Securities. The Series B Preferred Shares are
        duly authorized and, upon issuance in accordance with the terms hereof,
        shall be duly issued, fully paid and nonassessable, are free from all
        taxes, liens and charges with respect to the issue thereof and are
        entitled to the rights and preferences set forth in the Certificate of
        Designations for the Series B Preferred Shares. The Conversion Shares
        issuable upon conversion of the Series B Preferred Shares will be duly
        authorized and reserved for issuance. Upon conversion or exercise in
        accordance with the Certificate of Designations the Conversion Shares
        will be duly issued, fully paid and nonassessable.

                (e) No Conflicts. Except as disclosed in SEC Documents, and
        assuming shareholder approval for an increase of the Company's Common
        Stock the execution, delivery and performance of this Agreement by the
        Company and the consummation by the Company of the transactions
        contemplated hereby will not (i) result in a violation of the
        Certificate of Incorporation, any certificate of designations of any
        outstanding series of preferred stock of the Company or the By-laws or
        (ii) conflict with or constitute a default (or an event which with
        notice or lapse of time or both would become a default) under, or give
        to others any rights of termination, amendment, acceleration or
        cancellation of, any agreement, indenture or instrument to which the
        Company or any of its subsidiaries is a party, or result in a violation
        of any law, rule, regulation, order, judgment or decree (including
        federal and state securities laws and regulations and the rules and
        regulations of the Nasdaq Stock Market Inc.'s OTC Bulletin Board on
        which the Common Stock is quoted) applicable to the Company or any of
        its subsidiaries or by which any property or asset of the Company or any
        of its subsidiaries is bound or affected. Except as disclosed in the SEC
        Documents, neither the Company nor its subsidiaries is in violation of
        any term of or in default under its Certificate of Incorporation or
        By-laws or their organizational charter or by-laws, respectively, or any
        material contract, agreement, mortgage, indebtedness, indenture,
        instrument, judgment, decree or order or any statute, rule or regulation
        applicable to the Company or its subsidiaries. The business of the
        Company and its subsidiaries is not being conducted, and shall not be
        conducted in violation of any material law, ordinance, or regulation of



                                       8
<PAGE>

        any governmental entity. Except as specifically contemplated by this
        Agreement and as required under the 1933 Act and any applicable state
        securities laws, the Company is not required to obtain any consent,
        authorization or order of, or make any filing or registration with, any
        court or governmental agency in order for it to execute, deliver or
        perform any of its obligations under or contemplated by this Agreement
        or the Registration Rights Agreement in accordance with the terms hereof
        or thereof. Except as disclosed in the SEC Documents, all consents,
        authorizations, orders, filings and registrations which the Company is
        required to obtain pursuant to the preceding sentence have been obtained
        or effected on or prior to the date hereof. The Company and its
        subsidiaries are unaware of any facts or circumstance, which might give
        rise to any of the foregoing.

                (f) SEC Documents: Financial Statements. Except as set forth on
        Schedule 3(f) attached hereto, since April 2000 the Company has filed
        all reports, schedules, forms, statements and other documents required
        to be filed by it with the SEC under of the Securities Exchange Act of
        1934, as amended (the "1934 Act") (all of the foregoing filed prior to
        the date hereof or amended after the date hereof and all exhibits
        included therein and financial statements and schedules thereto and
        documents incorporated by reference therein, being hereinafter referred
        to as the "SEC Documents"). The Company has delivered to the Buyers or
        their representatives, or made available through the SEC's website at
        http://www.sec.gov., true and complete copies of the SEC Documents. As
        of their respective dates, the financial statements of the Company
        disclosed in the SEC Documents (the "Financial Statements") complied as
        to form in all material respects with applicable accounting requirements
        and the published rules and regulations of the SEC with respect thereto.
        Such financial statements have been prepared in accordance with
        generally accepted accounting principles, consistently applied, 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 audit adjustments). No other information provided by or on
        behalf of the Company to the Buyer which is not included in the SEC
        Documents, including, without limitation, information referred to in
        Section 2(d) and (i) of this Agreement, contains any untrue statement of
        a material fact or omits to state any material fact necessary in order
        to make the statements therein, in the light of the circumstances under
        which they were made, not misleading.

                (g) 10(b)-5. The SEC Documents do not include any untrue
        statements of material fact, nor do they omit to state any material fact
        required to be stated therein necessary to make the statements made, in
        light of the circumstances under which they were made, not misleading.

                (h) Absence of Litigation. Except as disclosed in the SEC
        Documents, there is no action, suit, proceeding, inquiry or
        investigation before or by any court, public board, government agency,
        self-regulatory organization or body pending against or



                                       9
<PAGE>

        affecting the Company, the Common Stock or any of the Company's
        subsidiaries, wherein an unfavorable decision, ruling or finding would
        (i) have a material adverse effect on the transactions contemplated
        hereby (ii) adversely affect the validity or enforceability of, or the
        authority or ability of the Company to perform its obligations under,
        this Agreement or any of the documents contemplated herein, or (iii)
        except as expressly disclosed in the SEC Documents, have a material
        adverse effect on the business, operations, properties, financial
        condition or results of operation of the Company and its subsidiaries
        taken as a whole.

                (i) Acknowledgment Regarding Buyer's Purchase of the Series B
        Preferred Shares. The Company acknowledges and agrees that the Buyer(s)
        is acting solely in the capacity of an arm's length purchaser with
        respect to this Agreement and the transactions contemplated hereby. The
        Company further acknowledges that the Buyer(s) is not acting as a
        financial advisor or fiduciary of the Company (or in any similar
        capacity) with respect to this Agreement and the transactions
        contemplated hereby and any advice given by the Buyer(s) or any of their
        respective representatives or agents in connection with this Agreement
        and the transactions contemplated hereby is merely incidental to such
        Buyer's purchase of the Series B Preferred Shares or the Conversion
        Shares. The Company further represents to the Buyer that the Company's
        decision to enter into this Agreement has been based solely on the
        independent evaluation by the Company and its representatives.

                (j) No General Solicitation. Neither the Company, nor any of its
        affiliates, nor any person acting on its or their behalf, has engaged in
        any form of general solicitation or general advertising (within the
        meaning of Regulation D under the 1933 Act) in connection with the offer
        or sale of the Series B Preferred Shares or the Conversion Shares.

                (k) No Integrated Offering. Neither the Company, nor any of its
        affiliates, nor any person acting on its or their behalf has, directly
        or indirectly, made any offers or sales of any security or solicited any
        offers to buy any security, under circumstances that would require
        registration of the Series B Preferred Shares or the Conversion Shares
        under the 1933 Act or cause this offering of the Series B Preferred
        Shares or the Conversion Shares to be integrated with prior offerings by
        the Company for purposes of the 1933 Act.

                (l) Employee Relations. Neither the Company nor any of its
        subsidiaries is involved in any labor dispute nor, to the knowledge of
        the Company or any of its subsidiaries, is any such dispute threatened.
        None of the Company's or its subsidiaries' employees is a member of a
        union and the Company and its subsidiaries believe that their relations
        with their employees are good.

                (m) Intellectual Property Rights. The Company and its
        subsidiaries have made no filings what so ever with respect to any
        trademarks, trade names, service marks, service mark registrations,
        service names, patents, patent rights, copyrights, inventions, trade
        secrets, know-how, designs, proprietary rights, processes, works of
        authorship or



                                       10
<PAGE>

        other intellectual property rights (collectively referred to as
        "Intellectual Property"). The Company has all rights necessary to use
        the Intellectual Property it currently uses. The Company and its
        subsidiaries do not have any knowledge of any infringement by the
        Company or its subsidiaries with respect to Intellectual Property , and,
        to the knowledge of the Company there is no claim, action or proceeding
        being made or brought against, or to the Company's knowledge, being
        threatened against, the Company or its subsidiaries regarding
        Intellectual Property and the Company and its subsidiaries are unaware
        of any facts or circumstances which might give rise to any of the
        foregoing.

                (n) Environmental Laws. The Company and its subsidiaries are (i)
        in compliance with any and all applicable foreign, federal, state and
        local laws and regulations relating to the protection of human health
        and safety, the environment or hazardous or toxic substances or wastes,
        pollutants or contaminants ("Environmental Laws"), (ii) have received
        all permits, licenses or other approvals required of them under
        applicable Environmental Laws to conduct their respective businesses and
        (iii) are in compliance with all terms and conditions of any such
        permit, license or approval.

                (o) Title. Any real property and facilities held under lease by
        the Company and its subsidiaries are held by them under valid,
        subsisting and enforceable leases with such exceptions as are not
        material and do not interfere with the use made and proposed to be made
        of such property and buildings by the Company and its subsidiaries.

                (p) Insurance. The Company and each of its subsidiaries are
        insured by insurers of recognized financial responsibility against such
        losses and risks and in such amounts as management of the Company
        believes to be prudent and customary in the businesses in which the
        Company and its subsidiaries are engaged. Neither the Company nor any
        such subsidiary has been refused any insurance coverage sought or
        applied for and neither the Company nor any such subsidiary has any
        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 at a cost that would not materially and adversely affect
        the condition, financial or otherwise, or the earnings, business or
        operations of the Company and its subsidiaries, taken as a whole.

                (q) Regulatory Permits. The Company and its subsidiaries possess
        all material certificates, authorizations and permits issued by the
        appropriate federal, state or foreign regulatory authorities necessary
        to conduct their respective businesses, and neither the Company nor any
        such subsidiary has received any notice of proceedings relating to the
        revocation or modification of any such certificate, authorization or
        permit.

                (r) Internal Accounting Controls. The Company and each of its
        subsidiaries maintain a system of internal accounting controls
        sufficient to provide reasonable assurance that (i) transactions are
        executed in accordance with management's general or specific
        authorizations, (ii) transactions are recorded as necessary to permit
        preparation of financial statements in conformity with generally
        accepted accounting principles and to maintain asset accountability, and
        (iii) the recorded amounts for assets is compared



                                       11
<PAGE>

        with the existing assets at reasonable intervals and appropriate action
        is taken with respect to any differences.

                (r) No Material Adverse Breaches, etc. Except as set forth in
        the SEC Documents, neither the Company nor any of its subsidiaries is
        subject to any charter, corporate or other legal restriction, or any
        judgment, decree, order, rule or regulation which in the judgment of the
        Company's officers has or is expected in the future to have a material
        adverse effect on the business, properties, operations, financial
        condition, results of operations or prospects of the Company or its
        subsidiaries. Neither the Company nor any of its subsidiaries is in
        breach of any contract or agreement which breach, in the judgment of the
        Company's officers, has or is expected to have a material adverse effect
        on the business, properties, operations, financial condition, results of
        operations or prospects of the Company or its subsidiaries.

                (s) Tax Status. The Company and each of its subsidiaries has
        made, filed, or has current extensions for all federal and state income
        and all other tax returns, reports and declarations required by any
        jurisdiction to which it is subject and (unless and only to the extent
        that the Company and each of its subsidiaries has set aside on its books
        provisions reasonably adequate for the payment of all unpaid and
        unreported taxes) has paid all taxes and other governmental assessments
        and charges that are material in amount, shown or determined to be due
        on such returns, reports and declarations, except those being contested
        in good faith and has set aside on its books provision reasonably
        adequate for the payment of all taxes for periods subsequent to the
        periods to which such returns, reports or declarations apply. There are
        no unpaid taxes in any material amount claimed to be due by the taxing
        authority of any jurisdiction, and the officers of the Company know of
        no basis for any such claim.

                (t) Certain Transactions. Except as set forth in the SEC
        Documents and except for arm's length transactions pursuant to which the
        Company makes payments in the ordinary course of business upon terms no
        less favorable than the Company could obtain from third parties and
        other than the grant of stock options disclosed in the SEC Documents,
        none of the officers, directors, or employees of the Company is
        presently a party to any transaction with the Company (other than for
        services as employees, officers and directors), including any contract,
        agreement or other arrangement providing for the furnishing of services
        to or by, providing for rental of real or personal property to or from,
        or otherwise requiring payments to or from any officer, director or such
        employee or, to the knowledge of the Company, any corporation,
        partnership, trust or other entity in which any officer, director, or
        any such employee has a substantial interest or is an officer, director,
        trustee or partner.

                (u) Fees and Rights of First Refusal. The Company is not
        obligated to offer the securities offered hereunder on a right of first
        refusal basis or otherwise to any third parties including, but not
        limited to, current or former shareholders of the Company, underwriters,
        brokers, agents or other third parties.



                                       12
<PAGE>

                (v) Dilutive Effect. The Company understands and acknowledges
        that the number of Conversion Shares issuable upon conversion of the
        Series B Preferred Shares will increase in certain circumstances. The
        Company further acknowledges that its obligation to issue Conversion
        Shares upon conversion of the Series B Preferred Shares in accordance
        with this Agreement and the Certificate of Designations and the Series B
        Preferred Shares is absolute and unconditional regardless of the
        dilutive effect that such issuance may have on the ownership interests
        of other stockholders of the Company.


        4. COVENANTS.

                (a) Best Efforts. Each party shall use its best efforts timely
        to satisfy each of the conditions to be satisfied by it as provided in
        Sections 6 and 7 of this Agreement.

                (b) Form D. The Company agrees to file a Form D with respect to
        the Conversion Shares as required under Regulation D and to provide a
        copy thereof to each Buyer promptly after such filing. The Company
        shall, on or before the Closing Date, take such action as the Company
        shall reasonably determine is necessary to qualify the Conversion
        Shares, or obtain an exemption for the Conversion Shares for sale to the
        Buyers at the Closing pursuant to this Agreement under applicable
        securities or "Blue Sky" laws of the states of the United States, and
        shall provide evidence of any such action so taken to the Buyers on or
        prior to the Closing Date.

                (c) Reporting Status. Until the earlier of (i) the date as of
        which the Investor(s) (as that term is defined in the Registration
        Rights Agreement) may sell all of the Conversion Shares without
        restriction pursuant to Rule 144(k) promulgated under the 1933 Act (or
        successor thereto), or (ii) the date on which (A) the Buyer(s) shall
        have sold all the Conversion Shares and (B) none of the Series B
        Preferred Shares are outstanding (the "Registration Period"), the
        Company shall use its commercially reasonable efforts to file in a
        timely manner all reports required to be filed with the SEC pursuant to
        the 1934 Act and the regulations of the SEC there under, and the Company
        shall not terminate its status as an issuer required to file reports
        under the 1934 Act even if the 1934 Act or the rules and regulations
        there under would otherwise permit such termination.

                (d) Use of Proceeds. The Company will use the proceeds from the
        sale of the Series B Preferred Shares for general corporate purposes.

                (e) Reservation of Shares. The Company shall take all action
        reasonably necessary to at all times have authorized, and reserved for
        the purpose of issuance, such number of shares of Common Stock as shall
        be necessary to effect the issuance of the Conversion Shares. If at any
        time the Company does not have available such shares of Common Stock as
        shall from time to time be sufficient to effect the conversion of all of
        the Conversion Shares of the Company shall call and hold a special
        meeting of the shareholders within sixty (60) days of such occurrence,
        for the sole purpose of increasing the number of shares authorized. The
        Company's management shall recommend to the shareholders to vote in
        favor of increasing the number of shares of



                                       13
<PAGE>

        Common Stock authorized. Management shall also vote all of its shares in
        favor of increasing the number of authorized shares of Common Stock .

                (f) Listings or Quotation. The Company shall promptly secure the
        listing or quotation of the Conversion Shares upon each national
        securities exchange, automated quotation system or Over-The-Counter
        Bulletin Board or other market, if any, upon which shares of Common
        Stock are then listed or quoted (subject to official notice of issuance)
        and shall use its best efforts to maintain, so long as any other shares
        of Common Stock shall be so listed, such listing of all Conversion
        Shares from time to time issuable under the terms of this Agreement. The
        Company shall maintain the Common Stock's authorization for quotation in
        the over-the counter market

                (g) Expenses. Each of the Company and the Buyer(s) shall pay all
        costs and expenses incurred by such party in connection with the
        negotiation, investigation, preparation, execution and delivery of this
        Agreement and the Registration Rights Agreement. The costs and expenses
        of the Placement Agent and its counsel, shall be paid for by the Company
        at Closing in accordance with the terms of the Placement Agent Agreement
        between the Company and the Placement Agent, dated July ___, 2001.

                (h) Corporate Existence. So long as any of the Series B
        Preferred Shares remain outstanding, the Company shall not directly or
        indirectly consummate any merger, reorganization, restructuring,
        consolidation, sale of all or substantially all of the Company's assets
        or any similar transaction or related transactions (each such
        transaction, a "Sale of the Company") unless, prior to the consummation
        of a Sale of the Company, the Company makes appropriate provision to
        insure that, upon the consummation of such Sale of the Company, each of
        the holders of the Series B Preferred Shares will thereafter have the
        right to acquire and receive such shares of stock, securities or assets
        as may be issued or payable with respect to or in exchange for the
        number of shares of Common Stock immediately theretofore acquirable and
        receivable upon the conversion of such holder's Series B Preferred
        Shares had such Sale of the Company not taken place. In any such case,
        the Company will make appropriate provision with respect to such
        holders' rights and interests to insure that the provisions of this
        Section 4(h) will thereafter be applicable to the Series B Preferred
        Shares.

                (i) Transactions With Affiliates. So long as any Series B
        Preferred Shares are outstanding, the Company shall not, and shall cause
        each of its subsidiaries not to, enter into, amend, modify or
        supplement, or permit any subsidiary to enter into, amend, modify or
        supplement any agreement, transaction, commitment, or arrangement with
        any of its or any subsidiary's officers, directors, persons who were
        officers or directors at any time during the previous two (2) years,
        stockholders who beneficially own five percent (5%) or more of the
        Common Stock, or Affiliates (as defined below) or with any individual
        related by blood, marriage, or adoption to any such individual or with
        any entity in which any such entity or individual owns a five percent
        (5%) or more beneficial interest (each a "Related Party"), except for
        (a) customary employment arrangements and benefit programs on reasonable
        terms, (b) any investment in an Affiliate of the Company, (c) any
        agreement, transaction, commitment, or arrangement on an arms-length
        basis on



                                       14
<PAGE>

        terms no less favorable than terms which would have been obtainable from
        a person other than such Related Party, (d) any agreement transaction,
        commitment, or arrangement which is approved by a majority of the
        disinterested directors of the Company, for purposes hereof, any
        director who is also an officer of the Company or any subsidiary of the
        Company shall not be a disinterested director with respect to any such
        agreement, transaction, commitment, or arrangement. "Affiliate" for
        purposes hereof means, with respect to any person or entity, another
        person or entity that, directly or indirectly, (i) has a ten percent
        (10%) or more equity interest in that person or entity, (ii) has ten
        percent (10%) or more common ownership with that person or entity, (iii)
        controls that person or entity, or (iv) shares common control with that
        person or entity. "Control" or "controls" for purposes hereof means that
        a person or entity has the power, whether direct or indirect, to conduct
        or govern the policies of another person or entity.

                (j) Transfer Agent. The Company covenants and agrees that, in
        the event that the Company's agency relationship with the transfer agent
        should be terminated for any reason prior to a date which is two (2)
        years after the Closing Date, the Company shall immediately appoint a
        new transfer agent and shall require that the transfer agent execute and
        agree to be bound by the terms of the Irrevocable Transfer Agent
        Instructions (as defined below) to Transfer Agent.


        5. TRANSFER AGENT INSTRUCTIONS.

                The Company shall issue irrevocable instructions in the form
        attached hereto as Exhibit D to its transfer agent to issue
        certificates, registered in the name of the Buyer(s) or its respective
        nominee(s), for the Conversion Shares representing such amounts of
        Series B Preferred Shares as specified from time to time by the Buyer(s)
        to the Company upon conversion of the Series B Preferred Shares (the
        "Irrevocable Transfer Agent Instructions"). Prior to registration of the
        Conversion Shares under the 1933 Act, all such certificates shall bear
        the restrictive legend specified in Section 2(g) of this Agreement. The
        Company warrants that no instruction other than the Irrevocable Transfer
        Agent Instructions referred to in this Section 5, and stop transfer
        instructions to give effect to Section 2(f) hereof (in the case of the
        Conversion Shares prior to registration of such shares under the 1933
        Act) will be given by the Company to its transfer agent and that the
        Conversion Shares shall otherwise be freely transferable on the books
        and records of the Company as and to the extent provided in this
        Agreement and the Registration Rights Agreement. Nothing in this Section
        5 shall affect in any way the Buyer's obligations and agreement to
        comply with all applicable securities laws upon resale of Conversion
        Shares. If the Buyer(s) provides the Company with an opinion of counsel,
        reasonably satisfactory in form and substance to the Company, that
        registration of a resale by the Buyer(s) of any of the Conversion Shares
        is not required under the 1933 Act, the Company shall permit the
        transfer and promptly instruct its transfer agent to issue one or more
        certificates in such name and in such denominations as specified by the
        Buyer. The Company acknowledges that a breach by it of its obligations
        hereunder will cause irreparable harm to the Buyer by vitiating the
        intent and purpose of the transaction contemplated hereby. Accordingly,
        the Company acknowledges that the remedy at law



                                       15
<PAGE>

        for a breach of its obligations under this Section 5 will be inadequate
        and agrees, in the event of a breach or threatened breach by the Company
        of the provisions of this Section 5, that the Buyer(s) shall be
        entitled, in addition to all other available remedies, to an injunction
        restraining any breach and requiring immediate issuance and transfer,
        without the necessity of showing economic loss and without any bond or
        other security being required.

        6. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL.

                The obligation of the Company hereunder to issue and sell the
        Series B Preferred Shares to the Buyer(s) at the Closing is subject to
        the satisfaction, at or before the Closing Date, of each of the
        following conditions, provided that these conditions are for the
        Company's sole benefit and may be waived by the Company at any time in
        its sole discretion:

                (a) Each Buyer shall have executed this Agreement and the
        Registration Rights Agreement and delivered the same to the Company.

                (b) The Certificate of Designations shall have been filed with
        the Secretary of State of the State of Nevada and the Company shall have
        provided the Buyers a Certificate of Good Standing from the Nevada
        Secretary of State.

                (c) The Buyer(s) shall have delivered to the Escrow Agent the
        Purchase Price for Series B Preferred Shares in respective amounts as
        set forth next to each Buyer as outlined on Schedule I attached hereto
        and the Escrow Agent shall have delivered such funds to the Company by
        wire transfer of immediately available U.S. funds pursuant to the wire
        instructions provided by the Company.

                (d) The representations and warranties of the Buyer(s) shall be
        true and correct in all material respects as of the date when made and
        as of the Closing Date as though made at that time (except for
        representations and warranties that speak as of a specific date), and
        the Buyer(s) shall have performed, satisfied and complied in all
        material respects with the covenants, agreements and conditions required
        by this Agreement to be performed, satisfied or complied with by the
        Buyer(s) at or prior to the Closing Date.

        7. CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE.

                The obligation of the Buyer(s) hereunder to purchase the Series
        B Preferred Shares at the Closing is subject to the satisfaction, at or
        before the Closing Date, of each of the following conditions, provided
        that these conditions are for the Buyer's sole benefit and may be waived
        by the Buyer(s) at any time in its sole discretion:

                (a) The Company shall have executed this Agreement and the
        Registration Rights Agreement, and delivered the same to the Buyer(s).



                                       16
<PAGE>

                (b) The Common Stock shall be authorized for quotation on The
        National Association of Securities Dealers, Inc. OTC Bulletin Board,
        trading in the Common Stock shall not have been suspended for any reason
        and all of the Conversion Shares issuable upon conversion of the Series
        B Preferred Shares shall be approved for listing or quotation on The
        National Association of Securities Dealers, Inc. OTC Bulletin Board.

                (c) The representations and warranties of the Company shall be
        true and correct in all material respects (except to the extent that any
        of such representations and warranties is already qualified as to
        materiality in Section 3 above, in which case, such representations and
        warranties shall be true and correct without further qualification) as
        of the date when made and as of the Closing Date as though made at that
        time (except for representations and warranties that speak as of a
        specific date) and the Company shall have performed, satisfied and
        complied in all material respects with the covenants, agreements and
        conditions required by this Agreement to be performed, satisfied or
        complied with by the Company at or prior to the Closing Date. The Buyer
        shall have received a certificate, executed by the President of the
        Company, dated as of the Closing Date, to the foregoing effect and as to
        such other matters as may be reasonably requested by the Buyer
        including, without limitation an update as of the Closing Date regarding
        the representation contained in Section 3(c) above.

                (d) The Company shall have executed and delivered to the
        Buyer(s) the Series B Preferred Shares in the respective amounts set
        forth opposite each Buyer(s) name on Schedule I attached hereto.



                (g) The Irrevocable Transfer Agent Instructions, in form and
        substance satisfactory to the Buyer, shall have been delivered to and
        acknowledged in writing by the Company's transfer agent.

        8. INDEMNIFICATION.

                (a) In consideration of the Buyer's execution and delivery of
        this Agreement and acquiring the Series B Preferred Shares and the
        Conversion Shares hereunder, and in addition to all of the Company's
        other obligations under this Agreement, the Company shall defend,
        protect, indemnify and hold harmless the Buyer(s) and each other holder
        of the Series B Preferred Shares and the Conversion Shares, and all of
        their officers, directors, employees and agents (including, without
        limitation, those retained in connection with the transactions
        contemplated by this Agreement) (collectively, the "Buyer Indemnitees")
        from and against any and all actions, causes of action, suits, claims,
        losses, costs, penalties, fees, liabilities and damages, and expenses in
        connection therewith (irrespective of whether any such Buyer Indemnitee
        is a party to the action for which indemnification hereunder is sought),
        and including reasonable attorneys' fees and disbursements (the
        "Indemnified Liabilities"), incurred by the Buyer Indemnitees or any of
        them as a result of, or arising out of, or relating to (i) any
        misrepresentation or breach of any representation or warranty made by
        the Company in this Agreement, the Series B



                                       17
<PAGE>

        Preferred Shares or the Registration Rights Agreement or any other
        certificate, instrument or document contemplated hereby or thereby, (ii)
        any breach of any covenant, agreement or obligation of the Company
        contained in this Agreement, or the Registration Rights Agreement nor
        any other certificate, instrument or document contemplated hereby or
        thereby, or (iii) any cause of action, suit or claim brought or made
        against such Indemnitee and arising out of or resulting from the
        execution, delivery, performance or enforcement of this Agreement or any
        other instrument, document or agreement executed pursuant hereto by any
        of the Indemnities, any transaction financed or to be financed in whole
        or in part, directly or indirectly, with the proceeds of the issuance of
        the Series B Preferred Shares nor the status of the Buyer or holder of
        the Series B Preferred Shares the Conversion Shares, as a Buyer of
        Series B Preferred Shares in the Company. To the extent that the
        foregoing undertaking by the Company may be unenforceable for any
        reason, the Company shall make the maximum contribution to the payment
        and satisfaction of each of the Indemnified Liabilities, which is
        permissible under applicable law.

                (b) In consideration of the Company's execution and delivery of
        this Agreement, and in addition to all of the Buyer's other obligations
        under this Agreement, the Buyer shall defend, protect, indemnify and
        hold harmless the Company and all of it's officers, directors, employees
        and agents (including, without limitation, those retained in connection
        with the transactions contemplated by this Agreement) (collectively, the
        "Company Indemnitees") from and against any and all Indemnified
        Liabilities incurred by the Indemnitees or any of them as a result of,
        or arising out of, or relating to (i) any misrepresentation or breach of
        any representation or warranty made by the Buyer(s) in this Agreement,
        instrument or document contemplated hereby or thereby executed by the
        Buyer, (ii) any breach of any covenant, agreement or obligation of the
        Buyer(s) contained in this Agreement, the Investor Registration Rights
        Agreement or any other certificate, instrument or document contemplated
        hereby or thereby executed by the Buyer, or (iii) any cause of action,
        suit or claim brought or made against such Company Indemnitee based on
        material misrepresentations or due to a material breach and arising out
        of or resulting from the execution, delivery, performance or enforcement
        of this Agreement, the Investor Registration Rights Agreement or any
        other instrument, document or agreement executed pursuant hereto by any
        of the Company Indemnitees. To the extent that the foregoing undertaking
        by each Buyer may be unenforceable for any reason, each Buyer shall make
        the maximum contribution to the payment and satisfaction of each of the
        Indemnified Liabilities, which is permissible under applicable law.


        9. GOVERNING LAW: MISCELLANEOUS.

                (a) Governing Law. This Agreement shall be governed by and
        interpreted in accordance with the laws of the State of New York without
        regard to the principles of conflict of laws. The parties further agree
        that any action between them shall be heard in New York City, New York,
        and expressly consent to the jurisdiction and venue of the Supreme Court
        of New York and the United States District Court for the Southern



                                       18
<PAGE>

        District of New York for the adjudication of any civil action asserted
        pursuant to this Paragraph.

                (b) Counterparts. This Agreement may be executed in two or more
        identical counterparts, all of which shall be considered one and the
        same agreement and shall become effective when counterparts have been
        signed by each party and delivered to the other party. In the event any
        signature page is delivered by facsimile transmission, the party using
        such means of delivery shall cause four (4) additional original executed
        signature pages to be physically delivered to the other party within
        five (5) days of the execution and delivery hereof.

                (c) Headings. The headings of this Agreement are for convenience
        of reference and shall not form part of, or affect the interpretation
        of, this Agreement.

                (d) Severability. If any provision of this Agreement shall be
        invalid or unenforceable in any jurisdiction, such invalidity or
        unenforceability shall not affect the validity or enforceability of the
        remainder of this Agreement in that jurisdiction or the validity or
        enforceability of any provision of this Agreement in any other
        jurisdiction.

                (e) Entire Agreement, Amendments. This Agreement supersedes all
        other prior oral or written agreements between the Buyer(s), the
        Company, their affiliates and persons acting on their behalf with
        respect to the matters discussed herein, and this Agreement and the
        instruments referenced herein contain the entire understanding of the
        parties with respect to the matters covered herein and therein and,
        except as specifically set forth herein or therein, neither the Company
        nor any Buyer makes any representation, warranty, covenant or
        undertaking with respect to such matters. No provision of this Agreement
        may be waived or amended other than by an instrument in writing signed
        by the party to be charged with enforcement.

                (f) Notices. Any notices, consents, waivers, or other
        communications required or permitted to be given under the terms of this
        Agreement must be in writing and will be deemed to have been delivered
        (i) upon receipt, when delivered personally; (ii) upon confirmation of
        receipt, when sent by facsimile; (iii) three (3) days after being sent
        by U.S. certified mail, return receipt requested, or (iv) one (1) day
        after deposit with a nationally recognized overnight delivery service,
        in each case properly addressed to the party to receive the same. The
        addresses and facsimile numbers for such communications shall be:



                                       19
<PAGE>

<TABLE>
                <S>                             <C>
                If to the Company, to:          Blagman Media International Inc.
                                                1901 Avenue of the Stars
                                                Suite 1710
                                                Los Angeles, CA 90067
                                                Attention:        Robert Blagman
                                                Chairman and Chief Executive Officer
                                                Telephone: (310) 788-5444
                                                Facsimile: (310) 788-5440

                With a copy to:                 Edward T. Swanson, Esq.

                                                1135 17th Street
                                                Santa Monica, CA 9043
                                                Attention: Edward T. Swanson, Esq.
                                                Telephone: (310) 283-1035
                                                Facsimile: (310) 828-6138

                If to the Transfer Agent, to:



                If to the Investor:             At the address listed on Schedule A.
</TABLE>


                If to the Buyer(s), to its address and facsimile number on
        Schedule I, with copies to the Buyer's counsel as set forth on Schedule
        I. Each party shall provide five (5) days' prior written notice to the
        other party of any change in address or facsimile number.

                (g) Successors and Assigns. This Agreement shall be binding upon
        and inure to the benefit of the parties and their respective successors
        and assigns. Neither the Company nor any Buyer shall assign this
        Agreement or any rights or obligations hereunder without the prior
        written consent of the other party hereto.

                (h) No Third Party Beneficiaries. This Agreement is intended for
        the benefit of the parties hereto and their respective permitted
        successors and assigns, and is not for the benefit of, nor may any
        provision hereof be enforced by, any other person.

                (i) Survival. Unless this Agreement is terminated under Section
        9(l) hereof, the representations and warranties of the Company and the
        Buyers contained in Sections 2 and 3, the agreements and covenants set
        forth in Sections 4, 5 and 9, and the indemnification provisions set
        forth in Section 8, shall survive the Closing for a period of one (1)
        year following the date on which the Series B Preferred Shares are
        converted in



                                       20
<PAGE>

        full. The Buyer(s) shall be responsible only for its own
        representations, warranties, agreements and covenants hereunder.

                (j) Publicity. The Company and the Buyer(s) shall have the right
        to approve, before issuance, any press release or any other public
        statement with respect to the transactions contemplated hereby made by
        any party; provided, however, that the Company shall be entitled,
        without the prior approval of the Buyer(s), to issue any press release
        or other public disclosure with respect to such transactions required
        under applicable securities or other laws or regulations (the Company
        shall use its best efforts to consult the Buyer(s) in connection with
        any such press release or other public disclosure prior to its release
        and Buyer(s) shall be provided with a copy thereof upon release
        thereof).

                (k) Further Assurances. Each party shall do and perform, or
        cause to be done and performed, all such further acts and things, and
        shall execute and deliver all such other agreements, certificates,
        instruments and documents, as the other party may reasonably request in
        order to carry out the intent and accomplish the purposes of this
        Agreement and the consummation of the transactions contemplated hereby.

                (1) Termination. In the event that the Closing shall not have
        occurred with respect to the Buyers on or before five (5) business days
        from the date hereof due to the Company's or the Buyer's failure to
        satisfy the conditions set forth in Sections 6 and 7 above (and the
        non-breaching party's failure to waive such unsatisfied condition(s)),
        the non-breaching party shall have the option to terminate this
        Agreement with respect to such breaching party at the close of business
        on such date without liability of any party to any other party;
        provided, however, that if this Agreement is terminated pursuant to this
        Section 9(l), the Company shall remain obligated to reimburse the
        Buyer(s) for the expenses described in Section 4(g) above.

                (m) Finder. The Company acknowledges that it has engaged The May
        Davis Group, Inc., as the placement agent in connection with the sale of
        the Series B Preferred Shares. The Company shall be responsible for the
        payment of any placement agent fees (which includes cash) relating to or
        arising out of the transactions contemplated hereby and from the
        proceeds thereof.

                (n) No Strict Construction. The language used in this Agreement
        will be deemed to be the language chosen by the parties to express their
        mutual intent, and no rules of strict construction will be applied
        against any party.


                    [REMAINDER PAGE INTENTIONALLY LEFT BLANK]





                                       21
<PAGE>

IN WITNESS WHEREOF, the Buyers and the Company have caused this Securities
Purchase Agreement to be duly executed as of the date first written above.

                                    COMPANY:
                                    BLAGMAN MEDIA INTERNATIONAL INC.

                                    By:
                                       -----------------------------------------
                                    Name: Robert Blagman
                                    Title: Chairman and Chief Executive Officer

                                    INVESTOR:

                                    By:
                                       -----------------------------------------
                                    Name: Mark A. Angelo



                                       22
<PAGE>

                                                                       EXHIBIT A




                       FORM OF CERTIFICATE OF DESIGNATIONS





<PAGE>

                                                                       EXHIBIT B




                 FORM OF INVESTORS REGISTRATION RIGHTS AGREEMENT




<PAGE>

                                                                       EXHIBIT C




                                ESCROW AGREEMENT




<PAGE>

                                                                       EXHIBIT D




                           TRANSFER AGENT INSTRUCTIONS


<PAGE>

                                                                       EXHIBIT E




                                 FORM OF WARRANT



<PAGE>

                                   SCHEDULE I
                               SCHEDULE OF BUYERS


<TABLE>
<CAPTION>
                                                   AMOUNT OF
  NAME       ADDRESS/FACSIMILE NUMBER OF BUYER    SUBSCRIPTION
--------     ---------------------------------    ------------    --------------
<S>          <C>                                  <C>             <C>





</TABLE>