EXHIBIT 10.51

                          SECURITIES PURCHASE AGREEMENT

      This SECURITIES  PURCHASE AGREEMENT (the  "Agreement"),  dated as of March
17, 2006, by and between NATIONAL HOLDINGS  CORPORATION,  a Delaware corporation
(the  "Company") and the purchaser  listed on Exhibit A hereto under the heading
"Purchaser"  (the  "Purchaser")  who has  become  a party to this  Agreement  by
executing and delivering a financing  signature page in the form attached hereto
as Exhibit B (the "Financing Signature Page").

      WHEREAS,  the Company desires to sell to the Purchaser,  and the Purchaser
desires to purchase  from the Company  159,090  shares of the  Company's  common
stock,  $0.02  par  value  per  share  (the  "Common  Stock"),  pursuant  to the
provisions of this Agreement; and

      NOW,  THEREFORE,  in  consideration of the mutual covenants and agreements
set forth in this Agreement, and for other good and valuable consideration,  the
receipt and sufficiency of which are hereby acknowledged,  the parties do hereby
agree as follows:

      1. Authorization; Sale of Common Stock.

            1.1  Authorization.  The  Company  has,  or before the  Closing  (as
defined  in Section  2.1) will  have,  duly  authorized  the sale and  issuance,
pursuant to the terms of this Agreement, of the Common Stock.

            1.2 Sale of Common  Stock.  Subject to the terms and  conditions  of
this  Agreement,  at the Closing,  the Company will sell and the Purchaser  will
purchase the Common Stock in the principal amount set forth on Exhibit A hereto.

      2. Purchase Price; Closing.

            2.1 Purchase Price. The purchase price (the "Purchase  Price") to be
paid by the  Purchaser  to the  Company to acquire  the  Common  Stock  shall be
$175,000.

            2.2  The  Closing.  Subject  to the  terms  and  conditions  of this
Agreement,  the closing (the  "Closing")  of the sale and purchase of the Common
Stock under this  Agreement  shall take place at the  offices of Littman  Krooks
LLP,  655 Third  Avenue,  New York NY 10017 (or  remotely  via the  exchange  of
documents and signatures) on the date of this Agreement (the "Closing Date"). At
the Closing:

                  (a) the Company shall deliver to the Purchaser  that number of
shares of Common  Stock set forth  opposite  the  Purchaser's  name on Exhibit A
attached hereto, registered in the name of the Purchaser; and

                  (b) the Purchaser  shall pay directly to the Company,  by wire
transfer of immediately available funds, the Purchase Price for the Common Stock
being purchased.

<PAGE>


      3.  Representations  of the Company.  The Company  hereby  represents  and
warrants to the Purchaser  that the  statements  contained in this Section 3 are
complete and accurate as of the date of this Agreement.

            3.1  Organization  and  Standing.   The  Company  and  each  of  its
subsidiaries  (as defined  below) is a  corporation  or other legal  entity duly
organized,  validly  existing  and  in  good  standing  under  the  laws  of its
jurisdiction of existence,  has all requisite corporate power and authority, and
has been duly  authorized by all necessary  approvals and orders,  to own, lease
and operate its assets and  properties to the extent owned,  leased and operated
and to carry on its business as it is now being  conducted and is duly qualified
and in good standing to do business in each  jurisdiction in which the nature of
its business or the ownership or leasing of its assets and properties makes such
qualification  necessary,  other than in such jurisdictions where the failure to
be so qualified  and in good standing  would not,  when taken  together with all
other such failures, reasonably be expected to have a material adverse effect on
the business, properties,  condition (financial or otherwise),  prospects (other
than   effects   that  are  the   result  of   general   economic   changes   or
industry-specific  risks)  or  results  of  operations  of the  Company  and its
subsidiaries  taken as a whole (any such material adverse effect being hereafter
referred to as a "Company Material Adverse Effect").  As used in this Agreement,
the term  "subsidiary"  of a person shall mean any  corporation  or other entity
(including  partnerships and other business associations) of which a majority of
the  outstanding  capital stock or other voting  securities  having voting power
under  ordinary  circumstances  to elect  directors  or  similar  members of the
governing body of such corporation or entity shall at the time be held, directly
or indirectly, by such person.

            3.2 Capitalization.  The authorized and outstanding capital stock of
the  Company  consists  of  the  following:   (i)  a  total  of  Thirty  Million
(30,000,000)  shares of Common Stock, of which  5,064,878  shares are issued and
outstanding;  and (ii) a total  of Two  Hundred  Thousand  (200,000)  shares  of
preferred  stock,  $0.01 par value per  share,  of which (A)  50,000  shares are
designated  as Series A  Convertible  Preferred  Stock  (the  "Series A Stock"),
33,320 of which are issued and  outstanding and (B) 20,000 shares are designated
as Series B Convertible Preferred Stock (the "Series A Stock"),  10,000 of which
are issued and outstanding.

            3.3 Issuance of Common Stock. The issuance, sale and delivery of the
Common Stock in accordance  with this Agreement has been, or will be on or prior
to the Closing, duly authorized by all necessary corporate action on the part of
the Company, and all such shares have been duly reserved for issuance.


                                      -2-
<PAGE>

            3.4 Corporate  Power;  Authority  for  Agreement;  No Conflict.  The
Company will have, at the Closing,  all requisite  legal and corporate  power to
execute and  deliver  this  Agreement,  to sell and issue the Common  Stock,  to
consummate the other  transactions  contemplated  by the terms of this Agreement
and carry out and perform its obligations under the terms of this Agreement. The
execution,  delivery and performance by the Company of this  Agreement,  and the
consummation by the Company of the transactions contemplated hereby and thereby,
have been duly authorized by all necessary  corporate action. This Agreement has
been,  and when  executed at the Closing will be, duly executed and delivered by
the  Company  and  constitute  valid  and  binding  obligations  of the  Company
enforceable in accordance with their respective terms, subject as to enforcement
of remedies to applicable bankruptcy, insolvency, reorganization,  moratorium or
similar laws  affecting  generally  the  enforcement  of  creditors'  rights and
subject to a court's  discretionary  authority with respect to the granting of a
decree ordering specific performance or other equitable remedies.  The execution
and  delivery  of  this  Agreement,   the   consummation  of  the   transactions
contemplated  hereby  and  thereby  and the  compliance  with  their  respective
provisions by the Company will not (a) conflict with or violate any provision of
the Certificate of Incorporation  or By-laws of the Company,  (b) require on the
part of the  Company  any filing  with,  or any  permit,  order,  authorization,
consent or approval of, any court, arbitrational tribunal, administrative agency
or commission or other  governmental or regulatory  authority or agency (each of
the foregoing is hereafter referred to as a "Governmental Entity"), (c) conflict
with,  result in a breach of, constitute (with or without due notice or lapse of
time or both) a default under,  result in the acceleration of obligations under,
create in any party the right to  accelerate,  terminate,  modify or cancel,  or
require any notice, consent or waiver under, any contract, agreement or mortgage
for borrowed money,  instrument of indebtedness,  or other  arrangement to which
the  Company is a party or by which the  Company is bound or to which its assets
are subject,  other than any of the  foregoing  events listed in this clause (c)
which do not and will  not,  individually  or in the  aggregate,  have a Company
Material Adverse Effect,  or (d) violate any order,  writ,  injunction,  decree,
statute,  rule or regulation  applicable to the Company or any of its properties
or assets.

            3.5  Governmental   Consents.   No  consent,   approval,   order  or
authorization of, or registration,  qualification,  designation,  declaration or
filing with, any  Governmental  Entity is required on the part of the Company in
connection  with the offer,  issuance,  sale and delivery of the Common Stock or
the other transactions to be consummated at the Closing, as contemplated by this
Agreement,  except  such  filings  as shall have been made prior to and shall be
effective  on and as of the Closing and such  filings  required to be made after
the Closing under  applicable  federal and state  securities  laws. Based on the
representations made by the Purchaser in Section 4 of this Agreement,  the offer
and sale of the Common  Stock to the  Purchaser  will be in material  compliance
with applicable federal and state securities laws.

            3.6 Financial  Statements.  The Purchaser has had the opportunity to
review the audited financial statements of the Company for the fiscal year ended
September 30, 2005,  and the unaudited  financial  statements of the Company for
the  quarter  ended  December  31,  2005 (all such  financial  statements  being
collectively referred to herein as the "Financial Statements"),  which have been
prepared on a consistent  basis  throughout the periods  indicated and with each
other.  Such  Financial  Statements  (i) are in  accordance  with the  books and
records of the Company; and (ii) are true, correct and complete, in all material
respects,  and present fairly the financial condition of the Company at the date
or dates, and for the periods,  indicated  therein and the results of operations
for the period therein specified.

            3.7  Broker's,  Finder's  or Similar  Fees.  There are no  brokerage
commissions, finder's fees or similar fees or commissions payable by the Company
in connection with the transactions  contemplated hereby based on any agreement,
arrangement or understanding  with the Company or any action taken by any entity
or individual.

                                      -3-
<PAGE>

      4. Representations of the Purchaser. The Purchaser represents and warrants
to the Company as follows:

            4.1 Organization and Existence.  The Purchaser is a validly existing
limited partnership and has all partnership power and authority to invest in the
Common Stock pursuant to this Agreement. The Purchaser was not formed solely for
the purpose of investing in the Common Stock.

            4.2  Authorization;  No  Contravention.  The execution  delivery and
performance by the Purchaser of this Agreement to which the Purchaser is a party
and the transactions  contemplated  hereby and thereby do not violate,  conflict
with or result in any breach or  contravention  of, or the  creation of any lien
under, any material contractual  obligation of such Purchaser or any requirement
of law  applicable  to the  Purchaser,  and do not  violate  any  orders  of any
Governmental Entity against, or binding upon, the Purchaser.

            4.3 Governmental  Authorization;  Third Party Consents. No approval,
consent, compliance, exemption,  authorization or other action by, or notice to,
or filing with, any Governmental  Entity or any other person,  and no lapse of a
waiting  period  under any  requirement  of law,  is  necessary  or  required in
connection  with the  execution,  delivery or  performance  (including,  without
limitation,  the purchase of the Common Stock) by, or enforcement  against,  the
Purchaser  of  this  Agreement  to  which  it is a  party  or  the  transactions
contemplated hereby and thereby.

            4.4 Binding Effect.  This Agreement and the other documents to which
the  Purchaser is a party have been duly executed and delivered by the Purchaser
and  constitutes  the legal,  valid and binding  obligations  of the  Purchaser,
enforceable  against him in accordance with its terms,  except as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization,  moratorium
or similar laws affecting  generally the  enforcement  of creditors'  rights and
subject to a court's  discretionary  authority with respect to granting a decree
ordering specific performance or other equitable remedies.

            4.5 Purchase for Own  Account.  The Common Stock hereby  acquired by
the Purchaser  pursuant to this Agreement are being acquired for the Purchaser's
own account and with no intention of  distributing  or reselling such securities
in any  transaction  that would be in  violation of the  securities  laws of the
United  States of America  or any state,  without  prejudice.  If the  Purchaser
should  in the  future  decide  to  dispose  of any of such  Common  Stock,  the
Purchaser  understands  and agrees that it may do so only in compliance with the
Securities  Act and applicable  state  securities  laws, as then in effect.  The
Purchaser  agrees to the  imprinting,  so long as required by law, of legends on
certificates representing all of its Common Stock:

                                      -4-
<PAGE>

            "THE  SECURITIES  REPRESENTED  BY THIS  CERTIFICATE  HAVE  NOT  BEEN
            REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
            OR THE  SECURITIES  LAWS OF ANY  STATE.  THE  SECURITIES  MAY NOT BE
            TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE  REGISTRATION  STATEMENT
            UNDER SUCH ACT AND APPLICABLE  STATE  SECURITIES LAWS OR PURSUANT TO
            AN APPLICABLE  EXEMPTION FROM THE REGISTRATION  REQUIREMENTS OF SUCH
            ACT AND SUCH LAWS."

            4.6  Restricted  Securities.  The Purchaser  understands  the Common
Stock will not be registered at the time of their  issuance under the Securities
Act since they are being acquired from the Company in a transaction  exempt from
the registration requirements of the Securities Act and that the reliance of the
Company  on  such   exemption  is   predicated   in  part  on  the   Purchaser's
representations set forth herein.

            4.7 Brokers, Finder's or Similar Fees. The Company has not incurred,
and will not incur,  directly or indirectly,  as a result of any action taken by
the  Purchaser,  any  liability  for  brokerage  or  finders'  fees  or  agents'
commissions or any similar charges in connection with this Agreement.

            4.8 Accredited Investor.  The Purchaser is an "accredited  investor"
within the  meaning of Rule 501 of  Regulation  D under the  Securities  Act, as
presently in effect.

            4.9   Experience.   The  Purchaser   has   carefully   reviewed  the
representations  concerning the Company contained in this Agreement and has made
detailed  inquiry  concerning the Company,  its business and its personnel;  the
officers of the Company have made available to the Purchaser any and all written
information  which  he has  requested  and  have  answered  to  the  Purchaser's
satisfaction  all  inquiries  made  by the  Purchaser;  and  the  Purchaser  has
sufficient  knowledge and  experience in finance and business that he is capable
of evaluating  the risks and merits of his, her or its investment in the Company
and the Purchaser is able financially to bear the risks thereof.

            4.10 No General  Solicitation.  Such  Investor  did not learn of the
investment in the  Securities as a result of any public  advertising  or general
solicitation.

            4.11 SEC Reports.  The  Purchaser  acknowledges  that it has had the
opportunity  to  review  the SEC  Reports  filed  with  the SEC,  including  the
information contained in the Company's most recently filed Annual Report on Form
10-K,  Quarterly  Report on Form 10-Q and Proxy  Statement on Schedule  14A. The
Purchaser  acknowledged  that it has  read  the  information  in  such  reports,
including the information under the caption "Risk Factors"  contained in the SEC
Reports.

                                      -5-
<PAGE>

            4.12 Investment in Brokerage  Business.  The Purchaser  acknowledges
that it is familiar with the risks involved in the security brokerage  business.
The Purchaser  acknowledges that it understands that a securities  broker-dealer
is  subject  to  uncertainties  that  are  common  in the  securities  industry,
including,  the  volatility of domestic and  international  financial,  bond and
stock  markets;   extensive   governmental   regulation;   litigation;   intense
competition;   substantial  fluctuations  in  the  volume  and  price  level  of
securities;  and  dependence  on the  solvency  of various  third  parties.  The
Purchaser  acknowledges  that it has  had  access  to the  NASD  Investor  Alert
entitled,  "Brokerage Firm Private Securities Offerings: Buying Your Brokerage,"
dated June 14, 2004.

      5.  Conditions  of  Closing  of  the  Purchaser.  The  obligations  of the
Purchaser to purchase  the Common Stock and transfer the Purchase  Price for the
Common Stock being purchased at the Closing are subject to the fulfillment at or
before the Closing, as applicable,  of the following conditions  precedent,  any
one or more of which may be waived in whole or in part by the  Purchaser,  which
waiver shall be at the sole discretion of the Purchases:

            5.1   Representations   and  Warranties.   The  representations  and
warranties  made by the  Company  in this  Agreement  shall  have  been true and
correct in all  respects  as of the date when made and as of the  Closing  Date,
except for the  representations  and warranties  that are expressly made as of a
particular date (which shall remain true and correct as of such date).

            5.2  Agreements.  All agreements,  and conditions  contained in this
Agreement to be performed or complied with by the Company prior to Closing shall
have been performed or complied with by the Company prior to or at the Closing.

            5.3  Consents,  Etc. The Company shall have secured and delivered to
the  Purchaser  all  consents  and  authorizations  that shall be  necessary  or
required  lawfully to consummate this Agreement and to issue the Common Stock to
be purchased by the Purchaser at the Closing.

            5.4 Proceedings and Documents.  All corporate and other  proceedings
in  connection  with the  transactions  contemplated  by this  Agreement and all
documents and instruments  incident to such transactions  shall be in a form and
substance  reasonably  satisfactory  to the Purchaser  and his counsel,  and the
Purchaser and his counsel shall have received all such counterpart  originals or
certified or other copies of such  documents as the Purchaser or his counsel may
reasonably request.

      6. Conditions of Closing of the Company. The Company's obligations to sell
and issue the Common Stock at the Closing are subject to the  fulfillment  at or
before the Closing of the following  conditions,  which conditions may be waived
in  whole  or in part by the  Company,  and  which  waiver  shall be at the sole
discretion of the Company:

            6.1   Representations   and  Warranties.   The  representations  and
warranties  made by the  Purchaser  in this  Agreement  shall have been true and
correct in all  respects  as of the date when made and as of the  Closing  Date,
except for the  representations  and warranties  that are expressly made as of a
particular date (which shall remain true and correct as of such date).

                                      -6-
<PAGE>

            6.2  Agreements.  All agreements,  and conditions  contained in this
Agreement to be performed or complied with by the Purchaser prior to the Closing
shall have been  performed  or complied  with by the Company  prior to or at the
Closing.

            6.3 Payment of Purchase Price. The Purchaser shall have tendered the
Purchase  Price in exchange  for the Common  Stock  being  issued  hereunder  in
accordance with Section 2.1.

            6.4 Delivery of  Documents.  All of the documents to be delivered by
the Purchaser pursuant to Section 2.1 or 2.2, as applicable,  shall be in a form
and substance reasonably  satisfactory to the Company and its counsel, and shall
have been  executed and  delivered  to the Company by each of the other  parties
thereto.

      7. Registration Rights. If the Company shall determine to prepare and file
with the Securities and Exchange 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 equities 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 the stock
option or other  employee  benefit  plans,  then the  Company  shall send to the
Purchaser a written  notice of such  determination  and, if within 15 days after
the date of such notice, the Purchaser shall so request in writing,  the Company
shall include in such registration statement all or any part of the Common Stock
purchased  hereunder  (the  "Shares") the Purchaser  requests to be  registered,
subject to customary  underwriter  cutbacks  applicable  to all selling  holders
proportionately  in such  offering;  provided,  that the  Company  shall  not be
required to register  any Shares  pursuant to this section that are eligible for
resale pursuant to Rule 144(k) promulgated under the Securities Act and all fees
and expenses  incurred by the  Purchaser in  connection  with such  registration
shall  be  paid  for by the  Company  (other  than  underwriting  discounts  and
commissions  and legal expenses of the  Purchaser).  In addition,  the Purchaser
shall be entitled to similar  indemnification  and related  rights and  benefits
provided  by the  Company to any other  selling  holders in such  offering.  The
Company shall have the right to terminate or withdraw any registration statement
initiated  by it pursuant to this Section 7 prior to the  effectiveness  of such
registration  statement  whether or not the Purchaser has elected to include its
Shares in such registration statement.

      8. Miscellaneous.

            8.1  Successors  and  Assigns.  This  Agreement,  and the rights and
obligations of the Purchaser hereunder,  may be assigned by the Purchaser to (a)
any person or entity to which Common Stock are transferred by the Purchaser,  or
(b) to any Affiliated  Party (as hereinafter  defined),  and, in each case, such
transferee  shall be  deemed  a  "Purchaser"  for  purposes  of this  Agreement;
provided that such  assignment of rights shall be contingent upon the transferee
providing  a written  instrument  to the Company  notifying  the Company of such
transfer and assignment and agreeing in writing to be bound by the terms of this
Agreement.  The  Company  may not assign its rights  under this  Agreement.  For
purposes of this Agreement,  "Affiliated  Party" shall mean, with respect to the
Purchaser,  any person or entity which,  directly or  indirectly,  controls,  is
controlled by or is under common control with the Purchaser,  including, without
limitation,  any general  partner,  officer or director of the Purchaser and any
venture  capital fund now or hereafter  existing  which is  controlled by one or
more  general  partners  of, or  shares  the same  management  company  as,  the
Purchaser.

                                      -7-
<PAGE>

            8.2  Expenses.  Each party  hereto shall pay its or his own expenses
relating to the transactions contemplated by this Agreement,  including, without
limitation,  the  fees  and  expenses  of their  respective  counsel,  financial
advisors and accountants.

            8.3  Severability.   The  invalidity  or   unenforceability  of  any
provision of this Agreement shall not affect the validity or  enforceability  of
any other provision of this Agreement.

            8.4 Specific Performance.  In addition to any and all other remedies
that may be available at law in the event of any breach of this  Agreement,  the
Purchaser  shall be entitled  to  specific  performance  of the  agreements  and
obligations  of the  Company  hereunder  and to such other  injunctive  or other
equitable relief as may be granted by a court of competent jurisdiction.

            8.5 Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York (without reference
to the conflicts of law provisions thereof).

            8.6   Notices.   All   notices,   requests,   consents,   and  other
communications  under this  Agreement  shall be in  writing  and shall be deemed
delivered  (i) three  business  days after being sent by registered or certified
mail, return receipt  requested,  postage prepaid or (ii) one business day after
being sent via a reputable  nationwide  overnight  courier service  guaranteeing
next business day delivery,  in each case to the intended recipient as set forth
below:

            If to the  Company,  to  National  Holdings  Corporation,  875 North
Michigan  Avenue,  Suite 1560,  Chicago,  IL 60611,  Attention:  Chief Executive
Officer,  or at such other address as may have been  furnished in writing by the
Company to the other  parties  hereto,  with a copy to Littman  Krooks LLP,  655
Third Avenue, New York, NY 10017, Attention: Mitchell C. Littman, Esq.; or

            If to the  Purchaser,  at its  address set forth on Exhibit A, or at
such other address as may have been furnished in writing by the Purchaser to the
Company.

            Any  party  may  give  any   notice,   request,   consent  or  other
communication  under this Agreement  using any other means  (including,  without
limitation,  personal delivery, messenger service, telecopy, first class mail or
electronic mail), but no such notice,  request,  consent or other  communication
shall be deemed to have been duly given unless and until it is actually received
by the party for whom it is intended.  Any party may change the address to which
notices,  requests,  consents  or  other  communications  hereunder  are  to  be
delivered  by giving  the other  parties  notice in the manner set forth in this
Section.

            8.7 Complete  Agreement.  This  Agreement  (including  its exhibits)
constitutes the entire  agreement and  understanding  of the parties hereto with
respect to the subject  matter hereof and  supersedes  all prior  agreements and
understandings relating to such subject matter.

                                      -8-
<PAGE>

            8.8  Amendments  and Waivers.  This  Agreement may not be amended or
terminated without the prior written consent of the Company.

            8.9 Pronouns. Whenever the context may require, any pronouns used in
this Agreement  shall include the  corresponding  masculine,  feminine or neuter
forms, and the singular form of nouns and pronouns shall include the plural, and
vice versa.

            8.10  Counterparts;  Facsimile  Signatures.  This  Agreement  may be
executed in any number of counterparts (including, in the case of the Purchaser,
Financing Signature Pages), each of which shall be deemed to be an original, and
all of  which  shall  constitute  one  and the  same  document.  This  Agreement
(including  the  Financing   Signature  Pages)  may  be  executed  by  facsimile
signatures.

            8.11 Section  Headings and References.  The section headings are for
the  convenience  of the parties and in no way alter,  modify,  amend,  limit or
restrict  the  contractual  obligations  of the parties.  Any  reference in this
agreement  to a  particular  section or  subsection  shall refer to a section or
subsection of this Agreement, unless specified otherwise.

            8.12 Confidentiality.  The Purchaser  acknowledges and agrees not to
use the Confidential  Information (as hereafter defined) disclosed to him by the
Company for any purpose  except as set forth in this  Agreement.  The  Purchaser
will not disclose any  Confidential  Information to any third party except those
directors, officers, employees,  consultants and agents who are required to have
the  information  in order to  carry  out the  purpose  of this  Agreement.  The
Purchaser also  understands  that certain of the  Confidential  Information  may
constitute  material  non-public  information  and that trading in the Company's
securities while in possession of Confidential Information, recommending trading
in the Company's  securities  based upon  Confidential  Information or providing
Confidential  Information  to others who may trade in the  Company's  securities
could constitute a violation of federal securities laws and expose the Purchaser
to civil and criminal liability.  The Purchaser  specifically  acknowledges that
the Confidential Information is subject to the public disclosure requirements of
Regulation FD promulgated under the Securities Exchange Act of 1934, as amended,
and that the Company is specifically  relying on the  Purchaser's  execution of,
and  performance  under,  this  Agreement in providing  the  Purchaser  with the
Confidential   Information  in  compliance  with  Regulation  FD.  "Confidential
Information"  means any the information  herein and any  information,  financial
data,  research,  technical data, or know-how  disclosed to the Purchaser by the
Company,  including,  but not  limited  to,  that  which  relates  to  services,
products, plans for future products and services, clients, markets,  operational
methods,  plans  for  future  development,   research,   software,   inventions,
processes, designs, drawings,  engineering,  hardware configuration information,
marketing, financial information, know-how and other trade secrets. Confidential
Information  does not include  information,  technical data or know-how that the
Purchaser can show: (i) was rightfully in the possession of the Purchaser at the
time of disclosure;  (ii) becomes a matter of public knowledge,  not as a result
of any inaction or action of the  Purchaser;  or (iii) was received from a third
party without a duty or confidentiality.

                                      -9-
<PAGE>


      Executed as of the date first written above.

                                    COMPANY:

                                    NATIONAL HOLDINGS CORPORATION



                                    By: /s/ Mark Goldwasser
                                        -----------------------
                                         Mark Goldwasser
                                         Chief Executive Officer


                                      -10-
<PAGE>



                                    EXHIBIT A

     Name and Address                                        No. of Shares of
       of Purchaser                Purchase Price              Common Stock
       ------------                --------------              ------------

Bedford Oak Partners, LP               $175,000                   159,090
100 South Bedford Road
Mt. Kisko, NY 10549









                                       A-1
<PAGE>



                                    EXHIBIT B

                            FINANCING SIGNATURE PAGE

      By execution and delivery of this signature page, the  undersigned  hereby
agrees to become a  Purchaser,  as defined in that certain  Securities  Purchase
Agreement (the "Purchase Agreement") by and among National Holdings Corporation,
a Delaware  corporation  (the  "Company"),  and the Purchaser (as defined in the
Purchase  Agreement),  dated as of the Closing  Date (as defined in the Purchase
Agreement),  acknowledges  having  read  the  representations  in  the  Purchase
Agreement  section  entitled  "Representations  of the  Purchaser,"  and  hereby
represents that the statements  contained therein are complete and accurate with
respect to the undersigned as a Purchaser. The undersigned further hereby agrees
to be  bound  by the  terms  and  conditions  of  the  Purchase  Agreement  as a
"Purchaser"  thereunder and authorizes this signature page to be attached to the
Purchase Agreement.

      Executed, in counterpart, as of the date set forth below.

                                 PURCHASER:

                                 BEDFORD OAK PARTNERS, LP


                                 By:  /s/ Harvey Eisen
                                      ------------------------------
                                 Name:  Harvey Eisen
                                 Title:  Chairman and Managing Partner

                                 Date:
                                      ------------------------------------------

                                 Contact Person:
                                                 -------------------------------

                                 Telephone No.:
                                                 -------------------------------

                                 Fax No.:
                                            ------------------------------------

                                 E-mail Address:
                                                 -------------------


                                       B-1