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                                                                   EXHIBIT 10.14

                          Exodus Communications, Inc.

                           Master Services Agreement

This Master Services Agreement (the "Agreement") between Exodus Communications,
Inc. ("Exodus") and HomeGrocer.com, Inc. ("Customer") is made effective as of
date indicated below the Customer signature on the initial Order Form submitted
by Customer and accepted by Exodus.

1.   Overview.

     1.1  General. This Agreement states the terms and conditions by which
Exodus will deliver and Customer will receive any or all of the services
provided by Exodus, including facilities, bandwidth, managed services and
professional services. If Customer purchases any equipment from Exodus (as
indicated in the Order Form(s) described below), the terms and conditions by
which Customer purchases and Exodus sells such equipment are stated in Addendum
A attached hereto. Only this Section 1.1 and Addendum A shall apply to the
purchase and sale of equipment. The specific services and/or products to be
provided hereunder are identified in the Order Form(s) submitted by Customer and
accepted by Exodus and described in detail in the Specification Sheets and
Statements of Work attached to each Order Form. Each Order Form, Specification
Sheet and Statement of Work submitted, accepted and executed by both parties is
hereby incorporated by reference into this Agreement. This Agreement is intended
to cover any and all Service(s) ordered by Customer and provided by Exodus. In
the event that any terms set forth herein apply specifically to a service not
ordered by Customer, such terms shall not apply to Customer.

     1.2  Definitions.

          (a)  "Customer Area" means those portion(s) of the Internet Data
Center(s) made available to Customer for the placement of Customer Equipment
and/or Exodus Supplied Equipment and use of the Service(s).

          (b)  "Customer Equipment" means the Customer's computer hardware, not
including stored data, and other tangible equipment placed by Customer in the
Customer Area. The Customer Equipment shall be identified on Exodus' standard
customer equipment list completed and delivered by Customer to Exodus, as
amended in writing from time to time by Customer.

          (c)  "Customer Registration Form" means the list that contains the
names and contact information of individuals authorized by Customer to enter the
Internet Data Center(s) and Customer Area, as delivered by Customer to Exodus
and amended in writing from time to time by Customer.

          (d)  "Customer Technology" means Customer's proprietary technology,
including, without limitation, Customer's Internet operations design, content,
software tools, hardware designs, algorithms, software (in source and object
forms), user interface designs, architecture, class libraries, objects and
documentation (both printed and electronic), know-how, trade secrets and any
related intellectual property rights throughout the world (whether owned by
Customer or licensed to Customer from a third party) and also including any
derivatives, improvements, enhancements or extensions of Customer Technology.

          (e)  "Exodus Technology" means Exodus' proprietary technology,
including Service(s), software tools, hardware designs, algorithms, software (in
source and object forms), user interface designs, architecture, class libraries,
objects and documentation (both printed and electronic), network designs, know-
how, trade secrets and any related intellectual property rights throughout the
world (whether owned by Exodus or licensed to Exodus from a third party) and
also including any derivatives, improvements, enhancements or extensions of
Exodus Technology that are not uniquely applicable to Customer.

          (f)  "Initial Term" means the minimum term for which Exodus will
provide the Service(s) to Customer, as indicated on the Order Form(s). Except as
otherwise expressly provided in this Agreement, Exodus is obligated to provide
and Customer is obligated to pay for each Service through its Initial Term.

          (g)  "Internet Data Center(s)" means any of the facilities used by
Exodus to provide the Service(s).

          (h)  "Professional Services" means any non-standard professional or
consulting service provided by Exodus to Customer as more fully described in a
Statement of Work.

          (i)  "Exodus Supplied Equipment" means the computer hardware, software
and other tangible equipment and intangible computer code contained therein to
be provided by Exodus for use by Customer as set forth on the Order Form(s).

          (j)  "Representatives" mean the individuals identified in writing on
the Customer Registration Form and authorized by Customer to enter the Internet
Data Center(s) and the Customer Area.

          (k)  "Rules and Regulations" means the Exodus general rules and
regulations governing Customer's use of Service(s), including, but not limited
to, on line conduct, and the obligations of Customer and its Representatives in
the Internet Data Center(s), which have been provided to Customer in writing
prior to execution of this Agreement.

          (l)  "Service(s)" means the specific Internet Data Center service(s)
provided by Exodus as described on the Order Form(s).

          (m)  "Service Commencement Date" means the date Exodus will begin
providing the Service(s) to Customer, as indicated in a Notice of Service
Commencement delivered by Exodus to Customer.

          (n)  "Service Level Warranty" is described and defined in Section 5.2
below.

          (o)  "Specification Sheet" means the detailed description for each
Service, other than Professional Services, ordered by Customer that is attached
to an Order Form(s).

          (p)  "Statement of Work" means the detailed description(s) of the
Professional Services attached to (an) Order Form(s).

          (r)  "Work" means any tangible deliverable provided by Exodus to
Customer as described in the Statement of Work for any Professional Service.

2.   Delivery of Services; Terms; Fees.

     2.1  Delivery of Services.

          (a)  General. By submitting an Order Form, Customer agrees to take and
pay for, and, by accepting the Order Form, Exodus agrees to provide, the
Service(s) during the Initial Term and for any period thereafter, as specified
in paragraph 2.2(b) below.

          (b)  Delivery of Supplemental Services. The purpose of this provision
is to enable Exodus to provide Customer with certain limited services and
equipment needed by Customer on a "one-off" or emergency basis ("Supplemental
Services") where such services are not included within the scope of the
Service(s) as described in the Specification Sheets and/or Statement of Work.
Supplemental Service may include, as an example, a request from Customer to
Exodus via telephone that Exodus immediately replace a problem Customer server
with an Exodus server for a temporary period of time. Exodus shall notify
Customer of the fees for any Supplemental Services requested by Customer and
obtain Customer's approval prior to providing such services. In the event Exodus
reasonably determines that Supplemental Services are required on an emergency
basis, after making reasonable attempts to contact Customer, Exodus may provide
such services without the consent of Customer, thereafter provide notice of the
services to Customer and bill Customer a reasonable fee for such services.
Customer agrees to pay Exodus the reasonable fees charged by Exodus for
Supplemental Services. Customer will be charged for Supplemental Services in the
invoice issued the month following delivery of the services. Exodus will use
commercially reasonable efforts to provide Supplemental Services, provided that
Exodus has no obligation to determine the need for or provide Supplemental
Services.All Supplemental Services provided pursuant to this paragraph 2.1(b)
are provided in a professional and workmanlike manner

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consistent with industry standards reasonably applicable to the performance
thereof. Otherwise, all Supplemental Services are provided on an "as-is" basis
and exclude warranties of any kind, whether express or implied.

     2.2  Term.

          (a)  Term Commencement. The term for each Service will commence on the
Service Commencement Date indicated in the Notice of Service Commencement
delivered by Exodus to Customer when Exodus begins providing each Service to
Customer, and shall continue through the duration of the Initial Term as
specified on the Order Form.

          (b)  Continuation of Services After Initial Term. At the end of the
Initial Term for each ordered monthly recurring Service, Exodus will continue to
provide the Service, and Customer will continue to take and pay for the monthly
recurring Service, indefinitely and pursuant to the terms and conditions of this
Agreement, until either party notifies the other in writing that it has elected
to terminate the Service, in which case, the term will end for such Service
effective thirty (30) days after the receipt of such notice. Notwithstanding the
foregoing, Exodus may change or increase the prices it charges Customer for any
Service at any time after the Initial Term effective sixty (60) days after
providing written notice to Customer. This paragraph 2.2(b) does not apply to
Exodus Supplied Equipment which is only provided for the Initial Term.

3.   Fees and payment terms.

     3.1  Fees and Expenses. Customer will pay all fees due according to the
prices and terms listed in the Order Form(s). The prices listed in the Order
Form(s) will remain in effect during the Initial Term indicated in the Order
Form(s) and will continue thereafter, unless modified in accordance with Section
2.2. Customer also agrees to reimburse Exodus for actual out-of-pocket
reasonable expenses incurred in providing Professional Services to Customer.

     3.2  Payment Terms. On the Service Commencement Date for each Service,
Customer will be billed an amount equal to all non-recurring charges indicated
in the Order Form and the monthly recurring charges for the first month of the
term. Monthly recurring charges for all other months will be billed in advance
of the provision of Service(s). All other charges for Service(s) received and
expenses incurred for Professional Services during a month (e.g., bandwidth
usage fees, travel expenses) will be billed at the end of the month in which the
Service(s) or Professional Services were provided. Payment for all fees is due
upon receipt of each Exodus invoice. All payments will be made in the United
States in U.S. dollars.

     3.3  Late Payments. Any payment not received within thirty (30) days of the
date of the invoice will accrue interest at a rate of one and one-half percent
(1 1/2%) per month, or the highest rate allowed by applicable law, whichever is
lower. If Customer is more than sixty (60) days delinquent in its payments,
Exodus may, upon written notice to Customer, modify the payment terms to require
full payment before the provision of all Service(s) and Exodus Supplied
Equipment or require other reasonable assurances to secure Customer's payment
obligations hereunder.

     3.4  Taxes. All fees charged by Exodus for Service(s) are exclusive of all
taxes and similar fees now in force or enacted in the future imposed on the
transaction and/or the delivery of Service(s), all of which Customer will be
responsible for and will pay in full, except for taxes based on Exodus' net
income.

4.   Confidential Information; Intellectual Property Ownership; License Grants.

     4.1  Confidential Information.

          (a)  Nondisclosure of Confidential Information. Each party
acknowledges that it will have access to certain confidential information of the
other party concerning the other party's business, plans, customers, technology,
and products, and other information held in confidence by the other party
("Confidential Information"). Confidential Information will include all
information in tangible or intangible form that is marked or designated as
confidential or that, under the circumstances of its disclosure, should be
considered confidential. Confidential Information will also include, but not be
limited to, Exodus Technology, Customer Technology, and the terms and conditions
of this Agreement. Each party agrees that it will not use in any way, for its
own account or the account of any third party, except as expressly permitted by,
or required to achieve the purposes of, this Agreement, nor disclose to any
third party (except as required by law or to that party's attorneys, accountants
and other advisors as reasonably necessary), any of the other party's
Confidential Information and will take reasonable precautions to protect the
confidentiality of such information, at least as stringent as it takes to
protect its own Confidential Information.

          (b)  Exceptions. Information will not be deemed Confidential
Information hereunder if such information: (i) is known to the receiving party
prior to receipt from the disclosing party directly or indirectly from a source
other than one having an obligation of confidentiality to the disclosing party;
(ii) becomes known (independently of disclosure by the disclosing party) to the
receiving party directly or indirectly from a source other than one having an
obligation of confidentiality to the disclosing party; (iii) becomes publicly
known or otherwise ceases to be secret or confidential, except through a breach
of this Agreement by the receiving party; or (iv) is independently developed by
the receiving party without reference to the other party's Confidential
Information. The receiving party may disclose Confidential Information pursuant
to the requirements of a governmental agency or by operation of law, provided
that it gives the disclosing party reasonable prior written notice sufficient to
permit the disclosing party to contest such disclosure.

     4.2  Intellectual Property.

          (a)  Ownership. Except for the rights expressly granted herein and the
assignment expressly made in paragraph 4.4(a), this Agreement does not transfer
from Exodus to Customer any Exodus Technology, and all right, title and interest
in and to Exodus Technology will remain solely with Exodus. Except for the
rights expressly granted herein, this Agreement does not transfer from Customer
to Exodus any Customer Technology, and all right, title and interest in and to
Customer Technology will remain solely with Customer. Exodus and Customer each
agrees that it will not, directly or indirectly, reverse engineer, decompile,
disassemble or otherwise attempt to derive source code or other trade secrets
from the other party.

          (b)  General Skills and Knowledge. Notwithstanding anything to the
contrary in this Agreement, Exodus will not be prohibited or enjoined at any
time from utilizing any skills or knowledge of a general nature acquired during
the course of providing the Services, including, without limitation, information
publicly known or available or that could reasonably be acquired in similar work
performed for another customer of Exodus.

     4.3  License Grants.

          (a)  By Exodus. Exodus hereby grants to Client a nonexclusive,
royalty-free license, during the term of this Agreement, to use the Exodus
Technology solely for purposes of using the Service(s), Supplemental Services
and Professional Service(s). Customer shall have no right to use the Exodus
Technology for any purpose other than using the Service(s), Supplemental
Services or Professional Services.

          (b)  By Customer. Customer agrees that if, in the course of performing
the Service(s), it is necessary for Exodus to access Customer Equipment and use
Customer Technology, Exodus is hereby granted and shall have a nonexclusive,
royalty-free license, during the term of this Agreement, to use the Customer
Technology solely for the purposes of delivering the Service(s) to Customer.
Exodus shall have no right to use the Customer Technology for any purpose other
than providing the Service(s).

     4.4  Professional Services; Assignments and License.

          (a)  Assignment of Work. Effective at the time Exodus receives full
and final payment for the Work, Exodus assigns to Customer all rights, title and
interest, including all intellectual property rights, in the Work, provided,
however, that such assignment does not include the Exodus Technology.

          (b)  License Grant. Commencing at the time Exodus receives full and
final payment for the Work, Exodus grants to Customer a non-exclusive, non-
transferable, royalty free, perpetual license to use the Exodus Technology

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incorporated into the Work solely in connection with the use of the Work as a
whole. To the extent that Customer or its employees or contractors participate
in the creation or development of Exodus Technology, Customer, on behalf of
itself and its employees and contractors, hereby assigns to Exodus all right,
title and interest, including all intellectual property rights in, the Exodus
Technology.

5.   Exodus Representations and Warranties.

      5.1 General.

          (a)  Authority and Performance of Exodus. Exodus represents and
warrants that (i) it has the legal right to enter into this Agreement and
perform its obligations hereunder,and (ii) the performance of its obligations
and delivery of the Service(s) to Customer will not violate any applicable U.S.
laws or regulations, including OSHA requirements, or cause a breach of any
agreements with any third parties. In the event of a breach the warranties set
forth in this paragraph 5.1(a), Customer's sole remedy is termination pursuant
to Section 10 of the Agreement.

          (b)  Year 2000 Performance Compliance. Exodus warrants that none of
the computer hardware and software systems and equipment incorporated into or
utilized in the delivery of the Service(s) contain any date dependent routines
or logic which will fail to operate correctly after December 31, 1999, by reason
of such date dependence; provided, however, that no representation or warranty
is made as to the adequacy of any Customer or third party service provider
hardware or software used in connection with the Service(s). Exodus agrees to
immediately notify Customer if it becomes aware that any third party's software
or hardware is not Year 2000 compliant. In the event of any breach of the
warranties under this paragraph 5.1(b), Customer's sole remedy is termination
pursuant to Section 10 of the Agreement.

     5.2. Service Level Warranty. In the event that Customer experiences any of
the service performance issues defined in this Section 5.2, Exodus will, upon
Customer's request in accordance with paragraph 5.2(d) below, credit Customer's
account as described below (the "Service Level Warranty"). The Service Level
Warranty includes a 100% facility uptime guarantee for the Internet Data
Center(s), a 100% power availability guarantee for power provided to the
Customer Area, a 99.97% uptime guarantee for Exodus' U.S. Network (which means
that Exodus shall use all reasonable commercial efforts to ensure that the
Exodus Network is operating and available to Customer at least 99.97% of the
time in any calendar month), and a latency guarantee for monthly average round-
trip transmissions of 120 milliseconds or less between any two points within
Exodus' U.S. network. The Service Level Warranty shall not apply to any services
other than bandwidth and facility services, and, shall not apply to performance
issues (i) caused by factors outside of Exodus's reasonable control; (ii) that
resulted from any actions or inactions of Customer or any third parties (not
including affiliates of Exodus); or (iii) that resulted from Customer's
equipment and/or third party equipment (not within the sole control of Exodus).

          (a)  Service Warranty Definitions. For purposes of this Agreement, the
following definitions shall apply only to the Service(s) (not including
Professional Services).

               (i)    "Downtime" shall mean sustained packet loss in excess of
fifty percent (50%) within Exodus' U.S. network for fifteen (15) consecutive
minutes. Downtime shall not include any packet loss or network unavailability
during Exodus' scheduled maintenance of the Internet Data Centers, network and
Service(s), as described in the Rules and Regulations. The term "Downtime" shall
include without limitation any service interruption for fifteen (15) consecutive
minutes due to a power failure or environmental control failure due to action or
inaction by Exodus at an Internet Data Center.

               (ii)   "Excess Latency" shall mean transmission latency in excess
of one hundred twenty (120) milliseconds round trip time between any two points
within Exodus' U.S. network.

               (iii)  "Excess Packet Loss" shall mean packet loss in excess of
one percent (1%) between any two points within Exodus' U.S. network.

               (iv)   "Performance Problem" shall mean Excess Packet Loss and/or
Excess Latency and/or Facility Downtime.

               (v)    "Service Credit" shall mean an amount equal to the pro-
rata monthly recurring connectivity charges (i.e., all monthly recurring
bandwidth-related charges) for one (1) day of Service.

          (b)  Downtime Periods. In the event Customer experiences Downtime,
Customer shall be eligible to and shall receive from Exodus a Service Credit for
each Downtime period. Examples: If Customer experiences one Downtime period, it
shall be eligible to and shall receive one Service Credit. If Customer
experiences two Downtime periods, either from a single event or multiple events,
it shall be eligible to and shall receive two Service Credits. If Customer
experiences Facility Downtime, Customer shall be eligible to and shall receive
from Exodus a Facility Downtime Service Credit for each Facility Downtime
Period.

          (c)  Performance Problem; Packet Loss and Latency; Requests for
Service Credits. In the event that Exodus discovers or is notified by Customer
that Customer is experiencing a Performance Problem, Exodus will take all
actions necessary to determine the source of the Performance Problem. Both
parties will use reasonable efforts to inform one another of any Performance
Problem, and to notify one another that Customer may be eligible for Service
Credits as a result of the Performance Problem. Customer shall have fourteen
(14) business days from the date Customer discovers or is notified by Exodus
that Customer is eligible for Service Credits as a result of a particular
Performance Problem to request such Service Credits, or such Service Credits
shall be deemed waived; a request for Service Credits may be made via email.

               (i)   Time to Discover Source of Performance Problem;
Notification of Customer. If Exodus discovers or receives notice of a
Performance Problem, Exodus will, within 30 minutes, page the Customer and
advise of the Performance Problem provided that Customer has provided a pager
number for such use. Within two (2) hours of discovering or receiving notice of
the Performance Problem, Exodus will determine whether the source of the
Performance Problem is limited to the Customer Equipment and the Exodus
equipment connecting the Customer Equipment to the Exodus LAN. If Exodus
determines that the Customer Equipment and Exodus connection are not the source
of the Performance Problem, Exodus will determine the source of the Performance
Problem within an additional two (2) hour period. In any event, Exodus will
notify Customer of the source of the Performance Problem within sixty (60)
minutes of identifying the source.

               (ii)  Remedy of Packet Loss and Latency. If the source of the
Performance Problem is within the sole control of Exodus, Exodus will remedy the
Performance Problem within two (2) hours of determining the source of the
Performance Problem. If the source of and remedy to the Performance Problem
reside outside of the Exodus LAN or WAN, Exodus will use commercially reasonable
efforts to notify the party(ies) responsible for the source of the Performance
Problem and cooperate with it (them) to resolve such problem as soon as
possible.

               (iii) Failure to Determine Source and/or Remedy. In the event
that Exodus (A) is unable to determine the source of the Performance Problem
within the time periods described in subsection (i) above and/or; (B) Exodus is
the sole source of the Performance Problem and is unable to remedy such
Performance Problem within the time period described in subsection (ii) above,
Exodus will deliver a Service Credit to Customer for each two (2) hour period in
excess of the time periods for identification and resolution described above.

          (d)  Remedies Shall Not Be Cumulative. A Service Credit shall be
issued in the Exodus invoice in the month following the Downtime or Performance
Problem, unless the Service Credit is due in Customer's final month of Service.
In such case, a refund for the dollar value of the Service Credit will be mailed
to Customer. Customer shall also be eligible to receive a pro-rata refund for
(i) Downtime periods and Performance Problems for which Customer does not
receive a Service Credit and (ii) any Service(s) Exodus does not deliver to
Customer for which Customer has paid.

          (e)  Termination Option for Chronic Problems. Customer may terminate
this Agreement for cause and without penalty by notifying Exodus within seven
(7) days following the end of a calendar month in the event either of the
following occurs: (i) Customer is entitled to more than seven (7) Service
Credits for Downtime or Performance Problems resulting from two (2) or more
nonconsecutive Downtime or Performance Problems events during the calendar
month; or (ii) Customer experiences more than four (4) consecutive hours of

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Downtime due to any single event Such termination will be effective upon receipt
of such notice by Exodus.

          (f)  The service level warranty set forth in this section 5.2 shall
only apply to the bandwidth and facilities Service(s) provided by exodus and,
does not apply to (i) any professional services; (ii)any supplemental services;
and (iii) any Service(s) that expressly exclude this service level warranty (as
stated AND INITIALED BY THE PARTIES on the order form OR IN THE SPECIFICATION
SHEETS for such Service(s)). Except with respect to willful misconduct or
negligence by Exodus, This Section 5.2 AND SECTION 10 states customer's sole and
exclusive remedies for any failure by Exodus to provide Service(s).

     5.3  Service Performance Warranty. Exodus warrants that it will perform the
Service(s) in a manner consistent with industry standards reasonably applicable
to the performance thereof.

     5.4  Selection of Exodus Supplied Equipment; Manufacturer Warranty.
Customer acknowledges that it has selected the Exodus Supplied Equipment. Except
with respect to any express warranties for Service(s) related to Exodus Supplied
Equipment, Customer acknowledges and agrees that its use and possession of the
Exodus Supplied Equipment by Customer shall be subject to and controlled by the
terms of any manufacturer's or, if appropriate, supplier's warranty. Customer
agrees to look solely to the manufacturer or, if appropriate, supplier with
respect to all mechanical, service and other claims, and the right to enforce
all warranties made by said manufacturer are hereby, to the extent Exodus has
the right, assigned to Customer.

     5.5  No Other Warranty. Except for the express warranties set forth in this
section 5, the Service(s) are provided on an "as is" basis, and Customer's use
of the Service(s) is at its own risk. Exodus does not make, and hereby
disclaims, any and all other Express and/or implied warranties, including, but
not limited to, warranties of merchantability, fitness for a particular purpose,
noninfringement and title, and any warranties arising from a course of dealing,
usage, or trade practice. Except as expressly set forth herein, Exodus does not
warrant that the Service(s) will be uninterrupted, error-free, or completely
secure.

     5.6  Disclaimer of Actions Caused by and/or Under the Control of Third
Parties. Exodus does not and cannot control the flow of data to or from Exodus'
network and other portions of the internet. Such flow depends in large part on
the performance of internet services provided or controlled by third parties. At
times, actions or inactions of such third parties can impair or disrupt
customer's connections to the Internet (or portions thereof). Although Exodus
will use commercially reasonable efforts to take all actions it deems
appropriate to remedy and avoid such events, exodus cannot guarantee that such
events will not occur. Accordingly, Exodus disclaims any and all liability
resulting from or related to such events unless caused by the willful misconduct
or negligence of Exodus.

6.   Customer Obligations.

     6.1  Warranties of Customer.

          (a)  General. Customer represents and warrants that (i) it has the
legal right and authority, and will continue to own or maintain the legal right
and authority, during the term of this Agreement, to place and use any Customer
Equipment as contemplated under this Agreement; (ii) the performance of its
obligations and use of the Service(s) will not violate any applicable laws,
regulations or the Rules and Regulations, or cause a breach of any of Customer's
agreements with any third parties, or unreasonably interfere with other Exodus
customers' use of Exodus services (e.g., diverting power from another Customer's
equipment, turning off power, intentionally causing sprinkler system to go on)
and (iii) all equipment, materials and other tangible items placed by Customer
at Internet Data Centers will be used in compliance with all applicable
manufacturer specifications.

          (b)  Breach of Warranties. In the event of any material breach of any
of the foregoing warranties, in addition to any other remedies available at law
or in equity, Exodus will have the right, in its sole reasonable discretion, to
suspend immediately any related Service(s) if deemed reasonably necessary by
Exodus to prevent any harm to Exodus and its business. Exodus will provide
written notice prior to suspension and opportunity to cure if practicable
depending on the nature of the breach. Once cured, Exodus will promptly restore
the Service(s).

     6.2  Compliance with Law and Rules and Regulations. Customer agrees that it
will use the Service(s) only for lawful purposes and in accordance with this
Agreement. Customer will comply at all times during the term of this Agreement
with all applicable laws and regulations and the Rules and Regulations, as
updated by Exodus from time to time. The Rules and Regulations are incorporated
herein and made a part hereof by this reference. Exodus may change the Rules and
Regulations upon fifteen (15) days' notice to Customer, which notice may be
provided by posting such new Rules and Regulations at the Exodus Web site
identified in the Rules and Regulations and notifying Customer by written
notice. Customer agrees that it has received, read and understands the current
version of the Rules and Regulations. The Rules and Regulations contain
restrictions on Customer's and Customer's users' online conduct (including
prohibitions against unsolicited commercial email) and contain financial
penalties for violations of such restrictions. Customer agrees to comply with
such restrictions and, in the event of a failure to comply, Customer agrees to
pay the reasonable financial penalties in accordance with the Rules and
Regulations. Customer acknowledges that Exodus exercises no control whatsoever
over the content of the information passing through Customer's site(s) and that
it is the sole responsibility of Customer to ensure that the information it and
its users transmit and receive complies with all applicable laws and regulations
and the Rules and Regulations.

     6.3  Access and Security. Except with the advanced written consent of
Exodus, Customer's access to the Internet Data Centers will be limited solely to
the Representatives. Representatives may only access the Customer Area and are
prohibited from accessing other areas of the Internet Data Center(s) unless
accompanied by an authorized Exodus representative.

     6.4  Restrictions on Use of Service(s). Customer shall not, without the
prior written consent of Exodus (which may be withheld in its sole discretion),
resell the Service(s) to any third parties or connect Customer Equipment
directly to anything other than the Exodus network, equipment and facilities.

     6.5  Relocation of Customer Equipment at Exodus' Request. In the event that
it becomes necessary to relocate the Customer Equipment to another Customer Area
or Internet Data Center operated by Exodus, Customer will cooperate in good
faith with Exodus to facilitate such relocation, provided that such relocation
is based on reasonable business needs of Exodus (including the needs of other
Exodus customers), the expansion of the space requirements of Customer or
otherwise. Exodus shall be solely responsible for all costs and expenses
incurred by Exodus in connection with any such relocation and will use
commercially reasonable efforts, in cooperation with Customer, to minimize and
avoid any interruption to the Service(s). If such relocation is more than ten
(10) miles away from the initial Internet Data Center, Customer will have right
to immediately terminate this Agreement. Exodus agrees not to relocate Customer
Equipment without Customer's prior consent and at Customer's sole discretion.

     6.6  Exodus Supplied Equipment.

          (a)  Delivery and Term. On or prior to the Service Commencement Date,
Exodus shall deliver to Customer, at the designated Customer Area, the Exodus
Supplied Equipment. Customer shall have the right to use the Exodus Supplied
Equipment for the Initial Term set forth in the Order Form and any additional
period agreed to in writing by Exodus. Customer shall not remove any Exodus
Supplied Equipment from the Customer Area(s) without the prior written consent
of Exodus.

          (b)  Title. The Exodus Supplied Equipment shall always remain the
personal property of Exodus. Customer shall have no right or interest in or to
the Exodus Supplied Equipment except as provided in this Agreement and the
applicable Order Form and shall hold the Exodus Supplied Equipment subject and
subordinate to the rights of Exodus. Customer agrees to execute UCC

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financing statements as and when requested by Exodus and hereby appoints Exodus
as its attorney-in-fact to execute such financing statements on behalf of
Customer. Customer will, at its own expense, keep the Exodus Supplied Equipment
free and clear from any liens or encumbrances of any kind (except any caused by
Exodus) and will indemnify and hold Exodus harmless from and against any loss or
expense caused by Customer's failure to do so. Each party shall give the other
immediate written notice of any attachment or judicial process affecting the
Exodus Supplied Equipment or Exodus' ownership. Customer will not remove, alter
or destroy any labels on the Exodus Supplied Equipment stating that it is the
property of Exodus and shall allow the inspection of the Exodus Supplied
Equipment at any time.

          (c)  Use, Maintenance and Repair. Customer will, at its own expense,
keep the Exodus Supplied Equipment in good repair, appearance and condition,
other than normal wear and tear, and, if not included in the Services, shall
obtain, pay for and keep in effect through the Initial Term a hardware and
software maintenance agreement with the manufacturer or other party acceptable
to Exodus. All parts furnished in connection with such repair and maintenance
shall be manufacturer authorized parts and shall immediately become components
of the Exodus Supplied Equipment and the property of Exodus. Customer shall use
the Exodus Supplied Equipment in compliance with the manufacturer's or
supplier's suggested guidelines.

          (d)  Upgrades and Additions. Customer may affix or install any
accessory, addition, upgrade, equipment or device on to the Exodus Supplied
Equipment (other than electronic data) ("Additions") provided that such
Additions (i) can be removed without causing material damage to the Exodus
Supplied Equipment; (ii) do not reduce the value of the Exodus Supplied
Equipment and (iii) are obtained from or approved in writing by Exodus and are
not subject to the interest of any third party other than Exodus. Any other
Additions may not be installed without Exodus' prior written consent. At the end
of the Initial Term, Customer shall remove any Additions which (i) were not
provided by Exodus and (ii) are readily removable without causing material
damage or impairment of the intended function, use, or value of the Exodus
Supplied Equipment, and restore the Exodus Supplied Equipment to its original
configuration. Any Additions, which are not so removable, will become the
property of Exodus (lien free).

7.   Insurance.

     7.1  Exodus Minimum Levels. Exodus agrees to keep in full force and effect
during the term of this Agreement: (i) comprehensive general liability insurance
in an amount not less than $2 million per occurrence for bodily injury and
property damage and (ii) workers' compensation insurance in an amount not less
than that required by applicable law. Exodus agrees that it will ensure and be
solely responsible for ensuring that its contractors and subcontractors maintain
insurance coverage at levels no less than those required by applicable law and
customary in Exodus' and its agents' industries.

     7.2  Customer Minimum Levels. In order to provide customers with physical
access to facilities operated by Exodus and equipment owned by third parties,
Exodus is required by its insurers to ensure that each Exodus customer maintains
adequate insurance coverage. Customer agrees to keep in full force and effect
during the term of this Agreement: (i) comprehensive general liability insurance
in an amount not less than $2 million per occurrence for bodily injury and
property damage and (ii) workers compensation insurance in an amount not less
than that required by applicable law. Customer agrees that it will ensure and be
solely responsible for ensuring that its agents (including contractors and
subcontractors) maintain insurance coverage at levels no less than those
required by applicable law and customary in Customer's and its agents'
industries.

     7.3  Certificates of Insurance. Prior to installation of any Customer
Equipment in the Customer Area, Customer will deliver to Exodus certificates of
insurance which evidence the minimum levels of insurance set forth above.

8.   Limitations of Liability.

     8.1  Personal Injury. Each Representative and any other person visiting an
Internet Data Center does so at its own risk. Exodus assumes no liability
whatsoever for any harm to such persons resulting from any cause other than the
negligence or willful misconduct of exodus.

     8.2  Damage to Customer Equipment. Exodus assumes no liability for any
damage to, or loss of, any Customer Equipment resulting from any cause other
than the negligence or willful misconduct of exodus. To the extent Exodus is
liable for any damage to, or loss of, Customer Equipment for any reason, such
liability will be limited solely to the then-current replacement value of the
Customer Equipment, excluding lost data , software and firmware.

     8.3. Consequential Damages Waiver. Except for a breach of section 4.1
("Confidential Information") and except in connection with matters covered by
section 9.1 ("Indemnification") of this agreement, in no event will either party
be liable or responsible to the other for any type of incidental, punitive,
indirect or consequential damages, including, but not limited to, lost revenue,
lost profits, replacement goods, loss of technology, rights or services, loss of
data, or interruption or loss of use of service or equipment, even if advised of
the possibility of such damages, whether arising under theory of contract, tort
(including negligence), strict liability or otherwise.

     8.4. Basis of the Bargain; Failure of Essential Purpose. The parties
acknowledge that Exodus has set its prices and entered into this Agreement in
reliance upon the limitations of liability and the disclaimers of warranties and
damages set forth herein, and that the same form an essential basis of the
bargain between the parties. The parties agree that the limitations and
exclusions of liability and disclaimers specified in this Agreement will survive
and apply even if found to have failed of their essential purpose.

9.   Indemnification.

     9.1. Indemnification. Each party (the "Indemnifying Party") will indemnify,
defend and hold the other party (the "Indemnified Party") harmless from and
against any and all costs, liabilities, losses, and expenses (including, but not
limited to, reasonable attorneys' fees) (collectively, "Losses") resulting from
any claim, suit, action, or proceeding (each, an "Action") brought by any third
party against the other or its affiliates alleging (A)if Exodus is the
Indemnifying Party: the Exodus Technology the Service(s), the Professional
Services or the Work infringes any intellectual property right (but excluding
any claim to the extent the infringement was contributorily caused by Customer),
or involves the wrongful use of any trade secret or confidential or proprietary
information; (ii) personal injury or property damage caused by the negligence or
willful misconduct of Exodus, its Representatives or designees; and/or (iii) any
violation by Exodus of or failure of Exodus to comply with the Rules and
Regulations.

(B) if Customer is the Indemnifying Party: (i) Customer's use of the Exodus
Technology, the Service(s), the Professional Services or the Work infringes any
intellectual property right or involves the wrongful use of any trade secret or
confidential or proprietary information (but only to the extent that the claim
would not have arisen had Customer's use not occurred); (ii) personal injury or
property damage caused by the negligence or willful misconduct of Customer, its
Representatives or designees (not including Exodus); (iii) any violation by
Customer of or failure of Customer to comply with the Rules and Regulations;
and/or (iv) except for losses caused by the willful misconduct or negligence of
Exodus, Customer will indemnify, defend and hold Exodus, its affiliates and
customers harmless from and against any and all Losses resulting from or arising
out of any Action brought against Exodus, its affiliates or customers alleging
any damage or destruction to the Customer Area, the Internet Data Centers,
Exodus equipment or other customer equipment caused by Customer, its
Representative(s) or designees (not including Exodus).

     9.2  Notice. Each party's indemnification obligations hereunder shall be
subject to (i) receiving prompt written notice of the existence of any Action;
(ii) being able to, at its option, control the defense of such Action; (iii)
permitting the indemnified party to participate in the defense of any Action;
and (iv) receiving full cooperation of the indemnified party in the defense
thereof.

10.  Termination.

                                                                          Page 5
<PAGE>

     10.1.  Termination of Services For Convenience Following Initial Term. The
Service(s) may be terminated for convenience in accordance with the terms set
forth in paragraph 2.2(b) of this Agreement.

     10.2.  Termination For Cause. Either party may terminate this Agreement if:
(i) the other party breaches any material term or condition of this Agreement
and fails to cure such breach within thirty (30) days after receipt of written
notice of the same, except in the case of failure to pay fees, which must be
cured within five (5) days after receipt of written notice from Exodus; (ii) the
other party becomes the subject of a voluntary petition in bankruptcy or any
voluntary proceeding relating to insolvency, receivership, liquidation, or
composition for the benefit of creditors; or (iii) the other party becomes the
subject of an involuntary petition in bankruptcy or any involuntary proceeding
relating to insolvency, receivership, liquidation, or composition for the
benefit of creditors, if such petition or proceeding is not dismissed within
sixty (60) days of filing. Customer may also terminate this Agreement in
accordance with the terms set forth in paragraph 5.2(a)(f) ("Termination Option
For Chronic Problems") or paragraph 6.5 ("Relocation of Customer Equipment") of
this Agreement.

     10.3   No Liability for Termination. Neither party will be liable to the
other for any termination or expiration of any Service or this Agreement in
accordance with its terms.

     10.4.  Effect of Termination. Upon the effective date of termination of
this Agreement:

          (a)  Exodus will immediately cease providing the Service(s);

          (b)  any and all payment obligations of Customer under this Agreement
for Service(s) provided through the date of termination will immediately become
due;

          (c)  within thirty (30) days of such termination, each party will
return all Confidential Information of the other party in its possession and
will not make or retain any copies of such Confidential Information except as
required to comply with any applicable legal or accounting record keeping
requirement; and

          (d)  within five (5) days of such termination Customer shall (i)
remove from the Internet Data Centers all Customer Equipment (excluding any
Exodus Supplied Equipment) and any other Customer property; (ii) deliver or make
available all Exodus Supplied Equipment to an authorized representative of
Exodus, and (iii) return the Customer Area to Exodus in the same condition as it
was on the Service Commencement Date for the Customer Area, normal wear and tear
excepted. If Customer does not remove the Customer Equipment and its other
property within such five-day period, Exodus will have the option to (i) move
any and all such property to secure storage and charge Customer for the cost of
such removal and storage, and/or (ii) upon fifteen (15) days' prior written
notice, liquidate the property in any reasonable manner.

     10.5.  Customer Equipment as Security. In the event that Customer fails to
pay Exodus all undisputed amounts owed Exodus under this Agreement when due,
Customer agrees that, upon delivery of written notice to Customer, Exodus may
(i) restrict Customer's physical access to the Customer Area and Equipment;
and/or (ii) take possession of any Customer Equipment and store it, at
Customer's expense, until taken in full or partial satisfaction of any lien or
judgment, all without being liable to prosecution or for damages.

     10.6.  Survival. The following provisions will survive any expiration or
termination of the Agreement: Sections 3, 4.1, 4.2, 4.4, 5.5, 6.6(d), 8, 9, 10
and 11 (excluding 11.3).

11.  Miscellaneous Provisions.

     11.1   Force Majeure. Except for the obligation to make payments, neither
party will be liable for any failure or delay in its performance under this
Agreement due to any cause beyond its reasonable control, including acts of war,
acts of God, earthquake, flood, embargo, riot, sabotage, labor shortage or
dispute, governmental act or failure of the Internet (not resulting from the
actions or inactions of Exodus), provided that the delayed party: (a) gives the
other party prompt notice of such cause, and (b) uses its reasonable commercial
efforts to promptly correct such failure or delay in performance. If Exodus is
unable to provide Service(s) for a period of seven (7) consecutive days as a
result of a continuing force majeure event, Customer may cancel the Service(s)
immediately.

     11.2   No Lease; Agreement Subordinate to Master Lease. This Agreement is a
services agreement and is not intended to and will not constitute a lease of any
real property. Customer acknowledges and agrees that (i) it has been granted
only a license to occupy the Customer Area and use the Internet Data Centers and
any equipment provided by Exodus in accordance with this Agreement; (ii)
Customer has not been granted any real property interest in the Customer Space
or Internet Data Centers; (iii) Customer has no rights as a tenant or otherwise
under any real property or landlord/tenant laws, regulations, or ordinances; and
(iv) this Agreement, to the extent it involves the use of space leased by
Exodus, shall be subordinate to any lease between Exodus and its landlord(s).

     11.3   Marketing. Provided that prior written approval is obtained, each
party agrees that the other party may refer to the other by trade name and
trademark, and may briefly describe the other's business, in marketing materials
and on its web site. Notwithstanding the foregoing, Customer hereby consents to
Exodus's inclusion of Customer's name in a customer listing published in a
prospectus or annual report, provided Customer is not the sole customer listed.
Each party hereby grants the other party a license to use any tradenames and
trademarks solely in connection with the rights granted to the other in this
Section 11.3.

     11.4   Government Regulations. Customer will not export, re-export,
transfer, or make available, whether directly or indirectly, any regulated item
or information to anyone outside the U.S. in connection with this Agreement
without first complying with all export control laws and regulations which may
be imposed by the U.S. Government and any country or organization of nations
within whose jurisdiction Customer operates or does business.

     11.5.  Non-Solicitation. During the Term of this Agreement and continuing
through the first anniversary of the termination of this Agreement, Customer
agrees that it will not, and will ensure that its affiliates do not, directly
solicit or attempt to solicit for employment any persons employed by Exodus who
has provided Services to and interacted directly with Customer under this
Agreement or contracted by Exodus to provide Services to Customer. During the
Term of this Agreement and continuing through the first anniversary of the
termination of this Agreement, Exodus agrees that it will not, and will ensure
that its affiliates do not, directly solicit or attempt to solicit for
employment any persons employed by Customer who has received Services from
Exodus and interacted directly with Exodus under this Agreement.

     11.6.  Third Party Beneficiaries. Exodus and Customer agree that, except as
otherwise expressly provided in this Agreement, there shall be no third party
beneficiaries to this Agreement, including but not limited to the insurance
providers for either party or the customers of Customer.

     11.7.  Governing Law; Dispute Resolution. This Agreement is made under and
will be governed by and construed in accordance with the laws of the State of
California (except that body of law controlling conflicts of law) and
specifically excluding from application to this Agreement that law known as the
United Nations Convention on the International Sale of Goods. The parties will
endeavor to settle amicably by mutual discussions any disputes, differences, or
claims whatsoever related to this Agreement. Failing such amicable settlement,
any controversy, claim, or dispute arising under or relating to this Agreement,
including the existence, validity, interpretation, performance, termination or
breach thereof, shall finally be settled by arbitration in accordance with the
Arbitration Rules (and if Customer is a non-U.S. entity, the International
Arbitration Rules) of the American Arbitration Association ("AAA"). There will
be three (3) arbitrators (the "Arbitration Tribunal"), the first of which will
be appointed by the claimant in its notice of arbitration, the second of which
will be appointed by the respondent within thirty (30) days of the appointment
of the first arbitrator and the third of which will be jointly appointed by the
party-appointed arbitrators within thirty (30) days thereafter. The language of
the arbitration shall be English. The Arbitration Tribunal will not have the
authority to award punitive damages to either party. Each party shall bear its

                                                                          Page 6
<PAGE>

own expenses, but the parties will share equally the expenses of the Arbitration
Tribunal and the AAA. This Agreement will be enforceable, and any arbitration
award will be final, and judgment thereon may be entered in any court of
competent jurisdiction. The arbitration will be held in San Francisco,
California, USA. Notwithstanding the foregoing, claims for preliminary
injunctive relief, other pre-judgment remedies, and claims for Customer's
failure to pay for Service(s) in accordance with this Agreement may be brought
in a state or federal court in the United States with jurisdiction over the
subject matter and parties.

     11.8.  Severability; Waiver. In the event any provision of this Agreement
is held by a tribunal of competent jurisdiction to be contrary to the law, the
remaining provisions of this Agreement will remain in full force and effect. The
waiver of any breach or default of this Agreement will not constitute a waiver
of any subsequent breach or default, and will not act to amend or negate the
rights of the waiving party.

     11.9.  Assignment. Either party may assign this Agreement in whole as part
of a corporate reorganization, consolidation, merger, or sale of substantially
all of its assets. Customer may not otherwise assign its rights or delegate its
duties under this Agreement either in whole or in part without the prior written
consent of Exodus, and any attempted assignment or delegation without such
consent will be void. Exodus may assign this Agreement in part or delegate the
performance of certain Services to third parties, including Exodus' wholly owned
subsidiaries, provided Exodus controls the delivery of such Services to Customer
and remains responsible to Customer for the delivery of such Services. Exodus
agrees, however, not to assign the Service(s) to another Internet Service
Provider without the prior consent of Customer. This Agreement will bind and
inure to the benefit of each party's successors and permitted assigns.

     11.10  Notice. Any notice or communication required or permitted to be
given hereunder may be delivered by hand, deposited with an overnight courier,
sent by email, confirmed facsimile, or mailed by registered or certified mail,
return receipt requested, postage prepaid, in each case to the address of the
receiving party as listed on the Order Form or at such other address as may
hereafter be furnished in writing by either party to the other party. Such
notice will be deemed to have been given as of the date it is delivered, mailed,
emailed, faxed or sent, whichever is earlier.

     11.11. Relationship of Parties. Exodus and Customer are independent
contractors and this Agreement will not establish any relationship of
partnership, joint venture, employment, franchise or agency between Exodus and
Customer. Neither Exodus nor Customer will have the power to bind the other or
incur obligations on the other's behalf without the other's prior written
consent, except as otherwise expressly provided herein.

     11.12. Entire Agreement; Counterparts; Originals. This Agreement, including
all documents incorporated herein by reference, constitutes the complete and
exclusive agreement between the parties with respect to the subject matter
hereof, and supersedes and replaces any and all prior or contemporaneous
discussions, negotiations, understandings and agreements, written and oral,
regarding such subject matter. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together shall constitute one and the same instrument. Once signed, any
reproduction of this Agreement made by reliable means (e.g., photocopy,
facsimile) is considered an original. This Agreement may be changed only by a
written document signed by authorized representatives of Exodus and Customer in
accordance with this Section 11.12. For purposes of this Agreement, the term
"written" means anything reduced to a tangible form by a party, including a
printed or hand written document, e-mail or other electronic format.

     11.13  Interpretation of Conflicting Terms. In the event of a conflict
between or among the terms in this Agreement, the Order Form(s), the
Specification Sheet(s), the Statement(s) of Work, and any other document made a
part hereof, the documents shall control in the following order: the Order Form
with the latest date, the Statement of Work, Specification Sheets, the Agreement
and other documents.

                                                                          Page 7
<PAGE>

Authorized representatives of Customer and Exodus have read the foregoing and
all documents incorporated therein and agree and accept such terms effective as
of the date first above written.

CUSTOMER                                     EXODUS COMMUNICATIONS, INC.

HOMEGROCER.COM, INC.

Signature: /s/ Rex L. Carter                 Signature: /s/ Susan Irvine
          ----------------------------                 -------------------------

Print Name: Rex L. Carter                    Print Name: Susan Irvine
           ---------------------------                  ------------------------

Title:    SR. V.P                            Title:    Manager, Contracts
          ----------------------------                 -------------------------

Date:     6/30/00                            Date:     7/5/00
          ----------------------------                 -------------------------

This Agreement incorporates the following documents:

          Order Form(s)

          Specification Sheet(s)

          Statement(s) Of Work (If Applicable)

          Registration Form

          Addendum A (Equipment Purchase Terms and Conditions)

                                                                          Page 8
<PAGE>

                                  Addendum A

                    Equipment Purchase Terms and conditions

          1.   SHIPPING AND HANDLING. All equipment purchased by Customer (the
"Equipment") is provided FOB Santa Clara, California. Shipment will be made as
specified by Customer and Customer is solely responsible for all expenses in
connection with the delivery of the Equipment. The Equipment will be deemed
accepted by Customer after twenty four hours inspection.

          2.   PURCHASE PRICE AND TAXES. Customer shall pay to Exodus the
purchase price set forth in the applicable Order Form ("Purchase Price") for
each item of Equipment. Customer hereby grants and Exodus reserves a security
interest in the Equipment and the proceeds thereof as a security for its
obligations hereunder until payment of the full Purchase Price to Exodus. The
Purchase Price is due and payable prior to delivery of the Equipment. Customer
shall pay all taxes and other governmental charges assessed in connection with
the rental, use or possession of the Equipment including, without limitation,
any and all sales and/or use taxes and personal property taxes (other than taxes
on Exodus' net income).

          3.   TITLE. Exodus represents and warrants that it has good and
marketable title to each item of Equipment, free an clear of all liens, charges
and encumbrances whatsoever, and that Customer shall acquire title to the
Equipment upon full payment of the purchase price(s) set forth herein.
Notwithstanding the foregoing, Exodus and any licensor of rights to Exodus shall
retain title to and rights in the intellectual property (whether or not subject
to patent or copyright) and content contained in the materials supplied under
the terms of this Agreement.

          4.   SELECTION OF EQUIPMENT; MANUFACTURER WARRANTY. Customer
acknowledges that is has selected the Equipment and disclaims any statements
made by Exodus. Customer acknowledges and agrees that use and possession of the
Equipment by Customer shall be subject to and controlled by the terms of any
manufacturer's or, if appropriate, supplier's warranty, and Customer agrees to
look solely to the manufacturer or, if appropriate, supplier with respect to all
mechanical, service and other claims, and all applicable manufacturer and
supplier warranties and the right to enforce all warranties made by said
manufacturer and supplier are hereby, to the extent Exodus has the right,
assigned to Customer. THE FOREGOING WARRANTY TOGETHER WITH THE WARRANTY OF TITLE
IN SECTION 3 ABOVE IS THE EXCLUSIVE WARRANTY AND IS IN LIEU OF ANY ORAL
REPRESENTATION AND ALL OTHER WARRANTIES AND DAMAGES, WHETHER EXPRESSED, IMPLIED
OR STATUTORY. EXODUS HAS NOT MADE NOR DOES MAKE ANY OTHER WARRANTIES OF ANY
KIND, EXPRESSED OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY WARRANTY OF FITNESS
FOR A PARTICULAR PURPOSE, MERCHANTABILITY, OR OF NONINFRINGEMENT OF THIRD PARTY
RIGHTS AND AS TO EXODUS AND ITS ASSIGNEES, CUSTOMER PURCHASES THE EQUIPMENT "AS
IS".

          5.   LIMITATION OF LIABILITY. Exodus' entire liability for any damages
which may arise hereunder, for any cause whatsoever, and regardless of the form
of action, whether in contract or in tort, including Exodus' negligence, or
otherwise, shall be limited to the Purchase Price paid by Customer for the
Equipment. IN NO EVENT WILL EXODUS BE LIABLE FOR ANY SPECIAL, INDIRECT,
INCIDENTAL, OR CONSEQUENTIAL DAMAGES, OR FOR ANY LOSS OF BUSINESS OR PROSPECTIVE
BUSINESS OPPORTUNITIES, PROFITS, SAVINGS, INFORMATION, USE OR OTHER COMMERICAL
OR ECONOMIC LOSS, EVEN IF EXODUS HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.

          6.   GOVERNING LAW; DISPUTE RESOLUTION. This Agreement is made under
and will be governed by and construed in accordance with the laws of the State
of California (except that body of law controlling conflicts of law) and
specifically excluding from application to this Agreement that law known as the
United Nations Convention on the International Sale of Goods. The parties will
endeavor to settle amicably by mutual discussions any disputes, differences, or
claims whatsoever related to this Agreement. Failing such amicable settlement,
any controversy, claim, or dispute arising under or relating to this Agreement,
including the existence, validity, interpretation, performance, termination or
breach thereof, either party may bring suit in a court of competent
jurisdiction.

          7.   MISCELLANEOUS. The above terms and conditions are the only terms
and conditions upon which Exodus is willing to sell the Equipment and supersedes
all previous agreements, promises or representations, oral or written.

                                                                          Page 1TECHNICAL CHEMICALS AND PRODUCTS, INC.

                              INVESTMENT AGREEMENT

         THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED WITH THE
         SECURITIES AND EXCHANGE COMMISSION OR ANY STATE OR OTHER SECURITIES
         AUTHORITIES. THEY MAY NOT BE SOLD OR TRANSFERRED EXCEPT PURSUANT TO AN
         EFFECTIVE REGISTRATION STATEMENT OR AN EXEMPTION FROM THE REGISTRATION
         REQUIREMENTS OF THE FEDERAL AND STATE SECURITIES LAWS.

         THIS INVESTMENT AGREEMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A
         SOLICITATION OF AN OFFER TO PURCHASE, ANY OF THE SECURITIES DESCRIBED
         HEREIN BY OR TO ANY PERSON IN ANY JURISDICTION IN WHICH SUCH OFFER OR
         SOLICITATION WOULD BE UNLAWFUL. THESE SECURITIES HAVE NOT BEEN
         RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES AUTHORITIES, NOR HAVE
         SUCH AUTHORITIES CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF
         THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
         OFFENSE.

         AN INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. THE
         INVESTOR MUST RELY ON ITS OWN ANALYSIS OF THE INVESTMENT AND ASSESSMENT
         OF THE RISKS INVOLVED. SEE THE RISK FACTORS SET FORTH IN THE ATTACHED
       7  DISCLOSURE DOCUMENTS AS EXHIBIT J.

         SEE ADDITIONAL LEGENDS AT SECTIONS 4.7.

                  THIS INVESTMENT AGREEMENT (this "Agreement" or "Investment
Agreement") is made as of the 3rd day of May, 2000, by and between Technical
Chemicals and Products, Inc., a corporation duly organized and existing under
the laws of the State of Florida (the "Company"), and the undersigned Investor
executing this Agreement ("Investor").

                                    RECITALS:

         WHEREAS, the parties desire that, upon the terms and subject to the
conditions contained herein, the Company shall issue to the Investor, and the
Investor shall purchase from the Company, from time to time as provided herein,
shares of the Company's Common Stock, as part of an offering of Common Stock by
the Company to Investor, for a maximum aggregate offering amount of Twenty Five
Million Dollars ($25,000,000) (the "Maximum Offering Amount"); and

         WHEREAS, the solicitation of this Investment Agreement and, if accepted
by the Company, the offer and sale of the Common Stock are being made in
reliance upon the provisions of Regulation D ("Regulation D") promulgated under
the Act, Section 4(2) of the Act, and/or upon such other exemption from the
registration requirements of the Act as may be available with respect to any or
all of the purchases of Common Stock to be made hereunder.

                                     TERMS:

         NOW, THEREFORE, the parties hereto agree as follows:

         1. Certain Definitions. As used in this Agreement (including the
recitals above), the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):

                                       1
<PAGE>

         "20% Approval" shall have the meaning set forth in Section 5.25.

         "9.9% Limitation" shall have the meaning set forth in Section 2.3.1(f).

         "Accredited Investor" shall have the meaning set forth in Section 3.1.

         "Act" shall mean the Securities Act of 1933, as amended.

         "Advance Put Notice" shall have the meaning set forth in Section
2.3.1(a), the form of which is attached hereto as Exhibit E.

         "Advance Put Notice Confirmation" shall have the meaning set forth in
Section 2.3.1(a), the form of which is attached hereto as Exhibit F.

         "Advance Put Notice Date" shall have the meaning set forth in Section
2.3.1(a).

         "Affiliate" shall have the meaning as set forth Section 6.4.

         "Aggregate Issued Shares" equals the aggregate number of shares of
Common Stock issued to Investor pursuant to the terms of this Agreement or the
Registration Rights Agreement as of a given date, including Put Shares and
Warrant Shares.

         "Agreed Upon Procedures Report" shall have the meaning set forth in
Section 2.5.3(b).

         "Agreement" shall mean this Investment Agreement.

         "Automatic Termination" shall have the meaning set forth in Section
2.3.2.

         "Bring Down Cold Comfort Letters" shall have the meaning set forth in
Section 2.3.6(b).

         "Business Day" shall mean any day during which the Principal Market is
open for trading.

         "Calendar Month" shall mean the period of time beginning on the numeric
day in question in a calendar month and for Calendar Months thereafter,
beginning on the earlier of (i) the same numeric day of the next calendar month
or (ii) the last day of the next calendar month. Each Calendar Month shall end
on the day immediately preceding the beginning of the next succeeding Calendar
Month.

         "Cap Amount" shall have the meaning set forth in Section 2.3.10.

         "Capital Raising Limitations" shall have the meaning set forth in
Section 6.5.1.

         "Capitalization Schedule" shall have the meaning set forth in Section
3.2.4, attached hereto as Exhibit K.

         "Closing" shall mean one of (i) the Investment Commitment Closing and
(ii) each closing of a purchase and sale of Common Stock pursuant to Section 2.

         "Closing Bid Price" means, for any security as of any date, the last
closing bid price for such security during Normal Trading on the Nasdaq National
Market System, or, if the Nasdaq National Market System is not the principal
securities exchange or trading market for such security, the last closing bid
price during Normal Trading of such security on the principal securities
exchange or trading market where such security is listed or traded as reported
by such principal securities exchange or trading market, or if the foregoing do
not apply, the last closing bid price during Normal Trading of such security in

                                       2
<PAGE>

the over-the-counter market on the electronic bulletin board for such security,
or, if no closing bid price is reported for such security, the average of the
bid prices of any market makers for such security as reported in the "pink
sheets" by the National Quotation Bureau, Inc. If the Closing Bid Price cannot
be calculated for such security on such date on any of the foregoing bases, the
Closing Bid Price of such security on such date shall be the fair market value
as mutually determined by the Company and the Investor in this Offering. If the
Company and the Investor in this Offering are unable to agree upon the fair
market value of the Common Stock, then such dispute shall be resolved by an
investment banking firm mutually acceptable to the Company and the Investor in
this offering and any fees and costs associated therewith shall be paid by the
Company.

         "Commitment Evaluation Period" shall have the meaning set forth in
Section 2.6.

         "Commitment Warrants" shall have the meaning set forth in Section
2.4.1, the form of which is attached hereto as Exhibit U.

         "Commitment Warrant Exercise Price" shall have the meaning set forth in
the Commitment Warrant.

         "Common Shares" shall mean the shares of Common Stock of the Company.

         "Common Stock" shall mean the common stock of the Company.

         "Company" shall mean Technical Chemicals and Products, Inc., a
corporation duly organized and existing under the laws of the State of Florida.

         "Company Designated Maximum Put Dollar Amount" shall have the meaning
set forth in Section 2.3.1(a).

         "Company Designated Minimum Put Share Price" shall have the meaning set
forth in Section 2.3.1(a).

         "Company Termination" shall have the meaning set forth in Section
2.3.12.

         "Conditions to Investor's Obligations" shall have the meaning as set
forth in Section 2.2.2.

          "Delisting Event" shall mean any time during the term of this
Investment Agreement, that the Company's Common Stock is not listed for and
trading on the NMS, the Nasdaq Small Cap Market, the O.T.C. Bulletin Board, the
American Stock Exchange or the New York Stock Exchange; or is suspended or
delisted with respect to the trading of the shares of Common Stock on such
market or exchange.

         "Disclosure Documents" shall have the meaning as set forth in Section
3.2.4.

         "Due Diligence Review" shall have the meaning as set forth in Section
2.5.

         "Effective Date" shall have the meaning set forth in Section 2.3.1.

         "Equity Securities" shall have the meaning set forth in Section 6.5.1.

         "Evaluation Day" shall have the meaning set forth in Section 2.3.1(b).

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

         "Excluded Day" shall have the meaning set forth in Section 2.3.1(b).

                                       3
<PAGE>

         "Extended Put Period" shall mean the period of time between the Advance
Put Notice Date until the Pricing Period End Date.

         "Impermissible Put Cancellation" shall have the meaning set forth in
Section 2.3.1(e).

         "Indemnified Liabilities" shall have the meaning set forth in Section
9.

         "Indemnitees" shall have the meaning set forth in Section 9.

         "Indemnitor" shall have the meaning set forth in Section 9.

         "Individual Put Limit" shall have the meaning set forth in Section
2.3.1 (b).

          "Ineffective Period" shall mean any period of time that the
Registration Statement or any Supplemental Registration Statement (each as
defined in the Registration Rights Agreement) becomes ineffective or unavailable
for use for the sale or resale, as applicable, of any or all of the Registrable
Securities (as defined in the Registration Rights Agreement) for any reason (or
in the event the prospectus under either of the above is not current and
deliverable) during any time period required under the Registration Rights
Agreement.

         "Intended Put Share Amount" shall have the meaning set forth in Section
2.3.1(a).

         "Investment Commitment Closing" shall have the meaning set forth in
Section 2.2.1.

         "Investment Agreement" shall mean this Investment Agreement.

         "Investment Commitment Opinion of Counsel" shall mean an opinion from
Company's independent counsel, substantially in the form attached as Exhibit B,
or such other form as agreed upon by the parties, as to the Investment
Commitment Closing.

         "Investment Date" shall mean the date of the Investment Commitment
Closing.

         "Investor" shall have the meaning set forth in the preamble hereto.

         "Key Employee" shall have the meaning set forth in Section 5.17, as set
forth in Exhibit N.

         "Late Payment Amount" shall have the meaning set forth in Section
2.3.8.

         "Legend" shall have the meaning set forth in Section 4.7.

         "Major Transaction" shall mean and shall be deemed to have occurred at
such time upon the closing of any of the following events:

                  (i) a consolidation, merger or other business combination or
event or transaction following which the holders of Common Stock of the Company
immediately preceding such consolidation, merger, combination or event either
(i) no longer hold a majority of the shares of Common Stock of the Company or
(ii) no longer have the ability to elect the board of directors of the Company
(a "Change of Control"); provided, however, that if the other entity involved in
such consolidation, merger, combination or event is a publicly traded company
with "Substantially Similar Trading Characteristics" (as defined below) as the
Company and the holders of Common Stock are to receive solely Common Stock or no
consideration (if the Company is the surviving entity) or solely common stock of
such other entity (if such other entity is the surviving entity), such
transaction shall not be deemed to be a Major Transaction (provided the
surviving entity, if other than the Company, shall have agreed to assume all

                                       4
<PAGE>

obligations of the Company under this Agreement and the Registration Rights
Agreement). For purposes hereof, an entity shall have Substantially Similar
Trading Characteristics as the Company if the average daily dollar Trading
Volume of the common stock of such entity is equal to or in excess of $500,000
for the 90th through the 31st day prior to the public announcement of such
transaction;

                  (ii) the sale or transfer of all or substantially all of the
Company's assets; or

                  (iii) a purchase, tender or exchange offer made to the holders
of outstanding shares of Common Stock, such that following such purchase, tender
or exchange offer a Change of Control shall have occurred.

         "Market Price" shall equal the lowest Closing Bid Price for the Common
Stock on the Principal Market during the Pricing Period for the applicable Put.

         "Material Facts" shall have the meaning set forth in Section 2.3.6(a).

         "Maximum Put Dollar Amount" shall mean the lesser of (i) the Company
Designated Maximum Put Dollar Amount, if any, specified by the Company in a Put
Notice, and (ii) $2 million.

         "Maximum Offering Amount" shall mean Twenty Five Million Dollars
($25,000,000).

         "Nasdaq 20% Rule" shall have the meaning set forth in Section 2.3.10.

         "NASD" shall have the meaning set forth in Section 6.9.

         "NMS" shall mean the Nasdaq National Market System.

         "Normal Trading" shall mean trading that occurs between 9:30 AM and
4:00 PM, New York City Time, on any Business Day, and shall expressly exclude
"after hours" trading.

         "NYSE" shall have the meaning set forth in Section 6.9.

         "Numeric Day" shall mean the numerical day of the month of the
Investment Date or the last day of the calendar month in question, whichever is
less.

         "Offering" shall mean the Company's offering of Common Stock and
Warrants issued under this Investment Agreement.

         "Officer's Certificate" shall mean a certificate, signed by an officer
of the Company, to the effect that the representations and warranties of the
Company in this Agreement required to be true for the applicable Closing are
true and correct in all material respects and all of the conditions and
limitations set forth in this Agreement for the applicable Closing are
satisfied.

         "Opinion of Counsel" shall mean, as applicable, the Investment
Commitment Opinion of Counsel, the Put Opinion of Counsel, and the Registration
Opinion.

         "Payment Due Date" shall have the meaning set forth in Section 2.3.8.

         "Pricing Period" shall mean, unless otherwise shortened under the terms
of this Agreement, the period beginning on the Business Day immediately
following the Put Date and ending on and including the date which is 20 Business
Days after such Put Date.

         "Pricing Period End Date" shall mean the last Business Day of any
Pricing Period.

                                       5
<PAGE>

         "Principal Market" shall mean the Nasdaq National Market, the Nasdaq
Small Cap Market, the O.T.C. Bulletin Board, , the American Stock Exchange or
the New York Stock Exchange, whichever is at the time the principal trading
exchange or market for the Common Stock.

         "Proceeding" shall have the meaning as set forth Section 5.1.

         "Purchase" shall have the meaning set forth in Section 2.3.7.

         "Purchase Warrants" shall have the meaning set forth in Section 2.4.2,
the form of which is attached hereto as Exhibit D.

         "Purchase Warrant Exercise Price" shall have the meaning set forth in
Section 2.4.2.

         "Put" shall have the meaning set forth in Section 2.3.1(d).

         "Put Cancellation" shall have the meaning set forth in Section
2.3.11(a).

         "Put Cancellation Notice Confirmation" shall have the meaning set forth
in Section 2.3.11(c), the form of which is attached hereto as Exhibit S.

         "Put Cancellation Date" shall have the meaning set forth in Section
2.3.11(a).

         "Put Cancellation Notice" shall have the meaning set forth in Section
2.3.11(a), the form of which is attached hereto as Exhibit Q.

         "Put Closing" shall have the meaning set forth in Section 2.3.8.

         "Put Closing Date" shall have the meaning set forth in Section 2.3.8.

         "Put Date" shall mean the date that is specified by the Company in any
Put Notice for which the Company intends to exercise a Put under Section 2.3.1,
unless the Put Date is postponed pursuant to the terms hereof, in which case the
"Put Date" is such postponed date.

         "Put Dollar Amount" shall be determined by multiplying the Put Share
Amount by the respective Put Share Prices with respect to such Put Shares,
subject to the limitations herein.

         "Put Notice" shall have the meaning set forth in Section 2.3.1(d), the
form of which is attached hereto as Exhibit G.

         "Put Notice Confirmation" shall have the meaning set forth in Section
2.3.1(d), the form of which is attached hereto as Exhibit H.

         "Put Opinion of Counsel" shall mean an opinion from Company's
independent counsel, in the form attached as Exhibit I, or such other form as
agreed upon by the parties, as to any Put Closing.

         "Put Share Amount" shall have the meaning as set forth Section
2.3.1(b).

         "Put Share Price" shall have the meaning set forth in Section 2.3.1(c).

         "Put Shares" shall mean shares of Common Stock that are purchased by
the Investor pursuant to a Put.

         "Registrable Securities" shall have the meaning as set forth in the
Registration Rights Agreement.
                                       6
<PAGE>

         "Registration Opinion" shall have the meaning set forth in Section
2.3.6(a), the form of which is attached hereto as Exhibit R.

         "Registration Opinion Deadline" shall have the meaning set forth in
Section 2.3.6(a).

         "Registration Rights Agreement" shall mean that certain registration
rights agreement entered into by the Company and Investor on even date herewith,
in the form attached hereto as Exhibit A, or such other form as agreed upon by
the parties.

         "Registration Statement" shall have the meaning as set forth in the
Registration Rights Agreement.

         "Regulation D" shall mean Regulation D promulgated under the Act.

         "Reporting Issuer" shall have the meaning set forth in Section 6.2.

         "Required Put Documents" shall have the meaning set forth in Section
2.3.5.

         "Risk Factors" shall have the meaning set forth in Section 3.2.4,
attached hereto as Exhibit J.

         "Schedule of Exceptions" shall have the meaning set forth in Section 5,
and is attached hereto as Exhibit C.

         "SEC" shall mean the Securities and Exchange Commission.

         "Securities" shall mean this Investment Agreement, together with the
Common Stock of the Company, the Warrants and the Warrant Shares issuable
pursuant to this Investment Agreement.

         "Semi-Annual Non-Usage Fee" shall have the meaning set forth in Section
2.6.

         "Share Authorization Increase Approval" shall have the meaning set
forth in Section 5.25.

         "Six Month Anniversary" shall mean the date that is the same Numeric
Day of the sixth (6th) calendar month after the Investment Date, and the date
that is the same Numeric Day of each sixth (6th) calendar month thereafter,
provided that if such date is not a Business Day, the next Business Day
thereafter.

         "Stockholder 20% Approval" shall have the meaning set forth in Section
6.11.

         "Supplemental Registration Statement" shall have the meaning set forth
in the Registration Rights Agreement.

         "Term" shall mean the term of this Agreement, which shall be a period
of time beginning on the date of this Agreement and ending on the Termination
Date.

         "Termination Date" shall mean the earlier of (i) the date that is three
(3) years after the Effective Date, or (ii) the date that is thirty (30)
Business Days after the later of (a) the Put Closing Date on which the sum of
the aggregate Put Share Price for all Put Shares equal the Maximum Offering
Amount, (b) the date that the Company has delivered a Termination Notice to the
Investor, (c) the date of an Automatic Termination, and (d) the date that all of
the Warrants have been exercised.

                                       7
<PAGE>

         "Termination Fee" shall have the meaning as set forth in Section 2.6.

         "Termination Notice" shall have the meaning as set forth in Section
2.3.12.

         "Third Party Report" shall have the meaning set forth in Section 3.2.4.

         "Trading Volume " shall mean the volume of shares of the Company's
Common Stock that trade between 9:30 AM and 4:00 PM, New York City Time, on any
Business Day, and shall expressly exclude any shares trading during "after
hours" trading.

         "Transaction Documents" shall have the meaning set forth in Section 9.

         "Transfer Agent Instructions" shall mean the Company's instructions to
its transfer agent, substantially in the form attached as Exhibit T, or such
other form as agreed upon by the parties.

         "Trigger Price" shall have the meaning set forth in Section 2.3.1(b).

         "Truncated Pricing Period" shall have the meaning set forth in Section
2.3.11(d).

         "Truncated Put Share Amount" shall have the meaning set forth in
Section 2.3.11(b).

         "Unlegended Share Certificates" shall mean a certificate or
certificates (or electronically delivered shares, as appropriate) (in
denominations as instructed by Investor) representing the shares of Common Stock
to which the Investor is then entitled to receive, registered in the name of
Investor or its nominee (as instructed by Investor) and not containing a
restrictive legend or stop transfer order, including but not limited to the Put
Shares for the applicable Put and Warrant Shares.

         "Use of Proceeds Schedule" shall have the meaning as set forth in
Section 3.2.4, attached hereto as Exhibit L.

         "Volume Limitations" shall have the meaning set forth in Section
2.3.1(b).

         "Warrant Shares" shall mean the Common Stock issued or issuable upon
exercise of the Warrants.

         "Warrants" shall mean Purchase Warrants and Commitment Warrants.

         2.       Purchase and Sale of Common Stock.

                  2.1  Offer to Subscribe.

                  Subject to the terms and conditions herein and the
satisfaction of the conditions to closing set forth in Sections 2.2 and 2.3
below, Investor hereby agrees to purchase such amounts of Common Stock and
accompanying Warrants as the Company may, in its sole and absolute discretion,
from time to time elect to issue and sell to Investor according to one or more
Puts pursuant to Section 2.3 below.

                  2.2      Investment Commitment.

                           2.2.1 Investment Commitment Closing. The closing of
this Agreement (the "Investment Commitment Closing") shall be deemed to occur
when this Agreement and the Registration Rights Agreement have been executed by
both Investor and the Company, the Transfer Agent Instructions have been

                                       8
<PAGE>

executed by both the Company and the Transfer Agent, and the other Conditions to
Investor's Obligations set forth in Section 2.2.2 below have been met.

                           2.2.2 Conditions to Investor's Obligations. As a
prerequisite to the Investment Commitment Closing and the Investor's obligations
hereunder, all of the following (the "Conditions to Investor's Obligations")
shall have been satisfied prior to or concurrently with the Company's execution
and delivery of this Agreement:

                  (a)      the following documents shall have been delivered to
                           the Investor: (i) the Registration Rights Agreement
                           (executed by the Company and Investor), (ii) the
                           Investment Commitment Opinion of Counsel (signed by
                           the Company's counsel), (iii) the Transfer Agent
                           Instructions (executed by the Company and the
                           Transfer Agent), and (iv) a Secretary's Certificate
                           as to (A) the resolutions of the Company's board of
                           directors authorizing this transaction, (B) the
                           Company's Certificate of Incorporation, and (C) the
                           Company's Bylaws;

                  (b)      this Investment Agreement, accepted by the Company,
                           shall have been received by the Investor;

                  (c)      the Company's Common Stock shall be listed for
                           trading and actually trading on the NMS, the Nasdaq
                           Small Cap Market, the O.T.C. Bulletin Board, the
                           American Stock Exchange or the New York Stock
                           Exchange;

                  (d)      other than continuing losses described in the Risk
                           Factors set forth in the Disclosure Documents
                           (provided for in Section 3.2.4), as of the Closing
                           there have been no material adverse changes in the
                           Company's business prospects or financial condition
                           since the date of the last balance sheet included in
                           the Disclosure Documents, including but not limited
                           to incurring material liabilities; and

                  (e)      the representations and warranties of the Company in
                           this Agreement shall be true and correct in all
                           material respects and the conditions to Investor's
                           obligations set forth in this Section 2.2.2 shall
                           have been satisfied as of such Closing; and the
                           Company shall deliver an Officer's Certificate,
                           signed by an officer of the Company, to such effect
                           to the Investor.

                  2.3  Puts of Common Shares to the Investor.

                           2.3.1 Procedure to Exercise a Put. Subject to the
Individual Put Limit, the Maximum Offering Amount and the Cap Amount (if
applicable), and the other conditions and limitations set forth in this
Agreement, at any time beginning on the date on which the Registration Statement
is declared effective by the SEC (the "Effective Date"), the Company may, in its
sole and absolute discretion, elect to exercise one or more Puts according to
the following procedure, provided that each subsequent Put Date after the first
Put Date shall be no sooner than five (5) Business Days following the preceding
Pricing Period End Date:

                                    (a) Delivery of Advance Put Notice.At least
ten (10) Business Days but not more than twenty (20) Business Days prior to any
intended Put Date (unless otherwise agreed in writing by the Investor), the
Company shall deliver advance written notice (the "Advance Put Notice," the form
of which is attached hereto as Exhibit E, the date of such Advance Put Notice
being the "Advance Put Notice Date") to Investor stating the Put Date for which
the Company shall, subject to the limitations and restrictions contained herein,
exercise a Put and stating the number of shares of Common Stock (subject to the
Individual Put Limit and the Maximum Put Dollar Amount) which the Company
intends to sell to the Investor for the Put (the "Intended Put Share Amount").

                                       9
<PAGE>

         The Company may, at its option, also designate in any Advance Put
Notice (i) a maximum dollar amount of Common Stock, not to exceed $2,000,000,
which it shall sell to Investor during the Put (the "Company Designated Maximum
Put Dollar Amount") and/or (ii) a minimum purchase price per Put Share at which
the Investor may purchase Shares pursuant to such Put Notice (a "Company
Designated Minimum Put Share Price"). The Company Designated Minimum Put Share
Price, if applicable, shall be no greater than 80% of the Closing Bid Price of
the Company's common stock on the Advance Put Notice Date. The Company may
decrease (but not increase) the Company Designated Minimum Put Share Price for a
Put at any time by giving the Investor written notice of such decrease not later
than 12:00 Noon, New York City time, on the Business Day immediately preceding
the Business Day that such decrease is to take effect. A decrease in the Company
Designated Minimum Put Share Price shall have no retroactive effect on the
determination of Trigger Prices and Excluded Days for days preceding the
Business Day that such decrease takes effect.

         Notwithstanding the above, if, at the time of delivery of an Advance
Put Notice, more than two (2) Calendar Months have passed since the date of the
previous Put Closing, such Advance Put Notice shall provide at least twenty (20)
Business Days notice of the intended Put Date, unless waived in writing by the
Investor. In order to effect delivery of the Advance Put Notice, the Company
shall (i) send the Advance Put Notice by facsimile on such date so that such
notice is received by the Investor by 6:00 p.m., New York, NY time, and (ii)
surrender such notice on such date to a courier for overnight delivery to the
Investor (or two (2) day delivery in the case of an Investor residing outside of
the U.S.). Upon receipt by the Investor of a facsimile copy of the Advance Put
Notice, the Investor shall, within two (2) Business Days, send, via facsimile, a
confirmation of receipt (the "Advance Put Notice Confirmation," the form of
which is attached hereto as Exhibit F) of the Advance Put Notice to the Company
specifying that the Advance Put Notice has been received and affirming the
intended Put Date and the Intended Put Share Amount.

                                    (b) Put Share Amount. The "Put Share Amount"
is the number of shares of Common Stock that the Investor shall be obligated to
purchase in a given Put, and shall equal the lesser of (i) the Intended Put
Share Amount, and (ii) the Individual Put Limit. The "Individual Put Limit"
shall equal the lesser of (i) 15% of the sum of the aggregate daily reported
Trading Volumes in the outstanding Common Stock on the Company's Principal
Market, excluding any block trades of 50,000 or more shares of Common Stock, for
all Evaluation Days (as defined below) in the Pricing Period, (ii) the number of
Put Shares which, when multiplied by their respective Put Share Prices, equals
the Maximum Put Dollar Amount, and (iii) the 9.9% Limitation, but in no event
shall the Individual Put Limit exceed 15% of the sum of the aggregate daily
reported Trading Volumes in the outstanding Common Stock on the Company's
Principal Market, excluding any block trades of 50,000 or more shares of Common
Stock, for the twenty (20) Business Days immediately preceding the Put Date
(this limitation, together with the limitation in (i) immediately above, are
collectively referred to herein as the "Volume Limitations"). Company agrees not
to trade Common Stock or arrange for Common Stock to be traded for the purpose
of artificially increasing the Volume Limitations.

         For purposes of this Agreement:

                  "Trigger Price" for any Pricing Period shall mean the greater
of (i) the Company Designated Minimum Put Share Price, plus $.10, or (ii) the
Company Designated Minimum Put Share Price divided by .92.

                  An "Excluded Day" shall mean each Business Day during a
Pricing Period where the lowest intra-day trading price of the Common Stock is
less than the Trigger Price.

                  An "Evaluation Day" shall mean each Business Day during a
Pricing Period that is not an Excluded Day.

                                       10
<PAGE>

                                    (c) Put Share Price. The purchase price for
the Put Shares (the "Put Share Price") shall equal the lesser of (i) the Market
Price for such Put, minus $.10, or (ii) 92% of the Market Price for such Put,
but shall in no event be less than the Company Designated Minimum Put Share
Price for such Put, if applicable.

                                    (d) Delivery of Put Notice. After delivery
of an Advance Put Notice, on the Put Date specified in the Advance Put Notice
the Company shall deliver written notice (the "Put Notice," the form of which is
attached hereto as Exhibit G) to Investor stating (i) the Put Date, (ii) the
Intended Put Share Amount as specified in the Advance Put Notice (such exercise
a "Put"), (iii) the Company Designated Maximum Put Dollar Amount (if
applicable), and (iv) the Company Designated Minimum Put Share Price (if
applicable). In order to effect delivery of the Put Notice, the Company shall
(i) send the Put Notice by facsimile on the Put Date so that such notice is
received by the Investor by 6:00 p.m., New York, NY time, and (ii) surrender
such notice on the Put Date to a courier for overnight delivery to the Investor
(or two (2) day delivery in the case of an Investor residing outside of the
U.S.). Upon receipt by the Investor of a facsimile copy of the Put Notice, the
Investor shall, within two (2) Business Days, send, via facsimile, a
confirmation of receipt (the "Put Notice Confirmation," the form of which is
attached hereto as Exhibit H) of the Put Notice to Company specifying that the
Put Notice has been received and affirming the Put Date and the Intended Put
Share Amount.

                                    (e) Delivery of Required Put Documents. On
or before the Put Date for such Put, the Company shall deliver the Required Put
Documents (as defined in Section 2.3.5 below) to the Investor (or to an agent of
Investor, if Investor so directs). Unless otherwise specified by the Investor,
the Put Shares of Common Stock shall be transmitted electronically pursuant to
such electronic delivery system as the Investor shall request; otherwise
delivery shall be by physical certificates. If the Company has not delivered all
of the Required Put Documents to the Investor on or before the Put Date, the Put
shall be automatically cancelled, unless the Investor agrees to delay the Put
Date by up to three (3) Business Days, in which case the Pricing Period begins
on the Business Day following such new Put Date. If the Company has not
delivered all of the Required Put Documents to the Investor on or before the Put
Date (or new Put Date, if applicable), and the Investor has not agreed in
writing to delay the Put Date, the Put is automatically canceled (an
"Impermissible Put Cancellation") and, unless the Put was otherwise canceled in
accordance with the terms of Section 2.3.11, the Company shall pay the Investor
$5,000 for its reasonable due diligence expenses incurred in preparation for the
canceled Put and the Company may deliver an Advance Put Notice for the
subsequent Put no sooner than ten (10) Business Days after the date that such
Put was canceled, unless otherwise agreed by the Investor.

                                    (f) Limitation on Investor's Obligation to
Purchase Shares. Notwithstanding anything to the contrary in this Agreement, in
no event shall the Investor be required to purchase, and an Intended Put Share
Amount may not include, an amount of Put Shares, which when added to the number
of Put Shares acquired by the Investor pursuant to this Agreement during the 31
days preceding the Put Date with respect to which this determination of the
permitted Intended Put Share Amount is being made, would exceed 9.99% of the
number of shares of Common Stock outstanding (on a fully diluted basis, to the
extent that inclusion of unissued shares is mandated by Section 13(d) of the
Exchange Act) on the Put Date for such Pricing Period, as determined in
accordance with Section 13(d) of the Exchange Act (the "Section 13(d)
Outstanding Share Amount"). Each Put Notice shall include a representation of
the Company as to the Section 13(d) Outstanding Share Amount on the related Put
Date. In the event that the Section 13(d) Outstanding Share Amount is different
on any date during a Pricing Period than on the Put Date associated with such
Pricing Period, then the number of shares of Common Stock outstanding on such
date during such Pricing Period shall govern for purposes of determining whether
the Investor, when aggregating all purchases of Shares made pursuant to this

                                       11
<PAGE>

Agreement in the 31 calendar days preceding such date, would have acquired more
than 9.99% of the Section 13(d) Outstanding Share Amount. The limitation set
forth in this Section 2.3.1(f) is referred to as the "9.9% Limitation."

                           2.3.2 Termination of Right to Put. The Company's
right to require the Investor to purchase any subsequent Put Shares shall
terminate permanently (each, an "Automatic Termination") upon the occurrence of
any of the following:

                                    (a) at any time, either the Company or any
director or executive officer of the Company has engaged in a transaction or
conduct related to the Company that has resulted in (i) a Securities and
Exchange Commission enforcement action, administrative proceeding or civil
lawsuit arising from or out of conduct after the date hereof, or (ii) a civil
judgment or criminal conviction for fraud or misrepresentation, or for any other
offense that, if prosecuted criminally, would constitute a felony under
applicable law;

                                    (b) the aggregate number of days that
comprise Ineffective Periods and Delisting Events exceeds 120 days;

                                    (c) at any time the Company has filed for
and/or is subject to any bankruptcy, insolvency, reorganization or liquidation
proceedings or other proceedings for relief under any bankruptcy law or any law
for the relief of debtors instituted by or against the Company or any subsidiary
of the Company;

                                    (d) the Company shall not exercise a Put
after the sooner of (i) the date that is three (3) years after the Effective
Date, or (ii) the Put Closing Date on which the aggregate of the Put Dollar
Amounts for all Puts equal the Maximum Offering Amount; and

                                    (e) the Company has breached any covenant in
Section 2.6 or Section 9 hereof, or has materially breached any covenant in
Section 6 and has not remedied such breach within 10 days after receiving
written notice thereof.

                                    (f) if no Registration Statement has been
declared effective by the date that is one (1) year after the date of this
Agreement, the Automatic Termination shall occur on the date that is one (1)
year after the date of this Agreement.

                           2.3.3 Put Limitations. The Company's right to
exercise a Put shall be limited as follows:

                                    (a) notwithstanding the amount of any Put,
the Investor shall not be obligated to purchase any additional Put Shares once
the aggregate Put Dollar Amount paid by Investor equals the Maximum Offering
Amount;

                                    (b) the Investor shall not be obligated to
acquire and pay for the Put Shares with respect to any Put for which the Company
has announced during the Extended Put Period a subdivision or combination,
including a reverse split, of its Common Stock or has subdivided or combined its
Common Stock;

                                    (c) the Investor shall not be obligated to
acquire and pay for the Put Shares with respect to any Put for which the Company
has paid a dividend of its Common Stock or has made any other distribution of
its Common Stock during the Extended Put Period;

                                    (d) the Investor shall not be obligated to
acquire and pay for the Put Shares with respect to any Put for which the Company
has made, during the Extended Put Period, a distribution of all or any portion
of its assets or evidences of indebtedness to the holders of its Common Stock;

                                       12
<PAGE>

                                    (e) the Investor shall not be obligated to
acquire and pay for the Put Shares with respect to any Put for which a Major
Transaction has occurred during the Extended Put Period.

                           2.3.4 Conditions Precedent to the Right of the
Company to Deliver an Advance Put Notice or a Put Notice and the Obligation of
the Investor to Purchase Put Shares. The right of the Company to deliver an
Advance Put Notice or a Put Notice and the obligation of the Investor hereunder
to acquire and pay for the Put Shares incident to a Closing is subject to the
satisfaction, on (i) the date of delivery of such Advance Put Notice or Put
Notice and (ii) the applicable Put Closing Date, of each of the following
conditions:

                  (a)      the Company's Common Stock shall be listed for and
                           trading on the NMS, the Nasdaq Small Cap Market, the
                           O.T.C. Bulletin Board, the American Stock Exchange or
                           the New York Stock Exchange; and the Put Shares shall
                           be so listed, and to the Company's knowledge there is
                           no notice of any suspension or delisting with respect
                           to the trading of the shares of Common Stock on such
                           market or exchange;

                  (b)      the Company shall have satisfied any and all
                           obligations pursuant to the Registration Rights
                           Agreement, including, but not limited to, the filing
                           of the Registration Statement with the SEC with
                           respect to the resale of all Registrable Securities
                           and the requirement that the Registration Statement
                           shall have been declared effective by the SEC for the
                           resale of all Registrable Securities and the Company
                           shall have satisfied and shall be in compliance with
                           any and all obligations pursuant to this Agreement
                           and the Warrants;

                  (c)      the representations and warranties of the Company are
                           true and correct in all material respects as if made
                           on such date and the conditions to Investor's
                           obligations set forth in this Section 2.3.4 are
                           satisfied as of such Closing, and the Company shall
                           deliver a certificate, signed by an officer of the
                           Company, to such effect to the Investor;

                  (d)      the Company shall have reserved for issuance a
                           sufficient number of Common Shares for the purpose of
                           enabling the Company to satisfy any obligation to
                           issue Common Shares pursuant to any Put and to effect
                           exercise of the Warrants;

                  (e)      the Registration Statement is not subject to an
                           Ineffective Period as defined in the Registration
                           Rights Agreement, the prospectus included therein is
                           current and deliverable, and to the Company's
                           knowledge there is no notice of any investigation or
                           inquiry concerning any stop order with respect to the
                           Registration Statement; and

                  (f)      if the Aggregate Issued Shares after the Closing of
                           the Put would exceed the Cap Amount, the Company
                           shall have obtained the Stockholder 20% Approval as
                           specified in Section 6.11, if the Company's Common
                           Stock is listed on the NASDAQ Small Cap Market or
                           NMS, and such approval is required by the rules of
                           the NASDAQ.

                           2.3.5 Documents Required to be Delivered on the Put
Date as Conditions to Closing of any Put. The Closing of any Put and Investor's
obligations hereunder shall additionally be conditioned upon the delivery to the
Investor of each of the following (the "Required Put Documents") on or before
the applicable Put Date:

                                       13
<PAGE>

                                    (a) a number of Unlegended Share
Certificates (or freely tradeable electronically delivered shares, as
appropriate) equal to the Intended Put Share Amount, in denominations of not
more than 50,000 shares per certificate;

                                    (b) the following documents: Put Opinion of
Counsel, Officer's Certificate, Put Notice, Registration Opinion, and any report
or disclosure required under Section 2.3.6 or Section 2.5, provided that the
Company shall not be required to provide a "Bring Down Cold Comfort Letter," as
defined below, if the Company has filed either a Form 10-Q or a Form 10-K within
the twenty (20) Business Days immediately preceding the Put Date for such Put;

                                    (c) all documents, instruments and other
writings required to be delivered on or before the Put Date pursuant to any
provision of this Agreement in order to implement and effect the transactions
contemplated herein.

                                       14
<PAGE>

               2.3.6 Accountant's Letter and Registration Opinion.

                                    (a) The Company shall have caused to be
delivered to the Investor, (i) whenever required by Section 2.3.6(b) or by
Section 2.5.3, and (ii) on the date that is three (3) Business Days prior to
each Put Date (the "Registration Opinion Deadline"), an opinion of the Company's
independent counsel, in substantially the form of Exhibit R (the "Registration
Opinion"), addressed to the Investor stating, inter alia, that no facts
("Material Facts") have come to such counsel's attention that have caused it to
believe that the Registration Statement is subject to an Ineffective Period or
to believe that the Registration Statement, any Supplemental Registration
Statement (as each may be amended, if applicable), and any related prospectuses,
contain an untrue statement of material fact or omits a material fact required
to make the statements contained therein, in light of the circumstances under
which they were made, not misleading. If a Registration Opinion cannot be
delivered by the Company's independent counsel to the Investor on the
Registration Opinion Deadline due to the existence of Material Facts or an
Ineffective Period, the Company shall promptly notify the Investor and as
promptly as possible amend each of the Registration Statement and any
Supplemental Registration Statements, as applicable, and any related prospectus
or cause such Ineffective Period to terminate, as the case may be, and deliver
such Registration Opinion and updated prospectus as soon as possible thereafter.
If at any time after a Put Notice shall have been delivered to Investor but
before the related Pricing Period End Date, the Company acquires knowledge of
such Material Facts or any Ineffective Period occurs, the Company shall promptly
notify the Investor and shall deliver a Put Cancellation Notice to the Investor
pursuant to Section 2.3.11 by facsimile and overnight courier by the end of that
Business Day.

                                    (b) (i) the Company shall engage its
independent auditors to perform the procedures in accordance with the provisions
of Statement on Auditing Standards No. 71, as amended, as agreed to by the
parties hereto, and reports thereon (the "Bring Down Cold Comfort Letters") as
shall have been reasonably requested by the Investor with respect to certain
financial information contained in the Registration Statement and shall have
delivered to the Investor such a report addressed to the Investor, on the date
that is three (3) Business Days prior to each Put Date.

                                            (ii) in the event that the Investor
shall have requested delivery of an Agreed Upon Procedures Report pursuant to
Section 2.5.3, the Company shall engage its independent auditors to perform
certain agreed upon procedures and report thereon as shall have been reasonably
requested by the Investor with respect to certain financial information of the
Company and the Company shall deliver to the Investor a copy of such report
addressed to the Investor. In the event that the report required by this Section
2.3.6(b) cannot be delivered by the Company's independent auditors, the Company
shall, if necessary, promptly revise the Registration Statement and the Company
shall not deliver a Put Notice until such report is delivered.

                           2.3.7 Investor's Obligation and Right to Purchase
Shares. Subject to the conditions set forth in this Agreement, following the
Investor's receipt of a validly delivered Put Notice, the Investor shall be
required to purchase (each a "Purchase") from the Company a number of Put Shares
equal to the Put Share Amount, in the manner described below.

                           2.3.8 Mechanics of Put Closing. Each of the Company
and the Investor shall deliver all documents, instruments and writings required
to be delivered by either of them pursuant to this Agreement at or prior to each
Closing. Subject to such delivery and the satisfaction of the conditions set
forth in Sections 2.3.4 and 2.3.5, the closing of the purchase by the Investor
of Shares shall occur by 5:00 PM, New York City Time, on the date which is five
(5) Business Days following the applicable Pricing Period End Date (or such
other time or later date as is mutually agreed to by the Company and the
Investor) (the "Payment Due Date") at the offices of Investor. On each or before
each Payment Due Date, the Investor shall deliver to the Company, in the manner
specified in Section 8 below, the Put Dollar Amount to be paid for such Put

                                       15
<PAGE>

Shares, determined as aforesaid. The closing (each a "Put Closing") for each Put
shall occur on the date that both (i) the Company has delivered to the Investor
all Required Put Documents, and (ii) the Investor has delivered to the Company
such Put Dollar Amount and any Late Payment Amount, if applicable (each a "Put
Closing Date").

         If the Investor does not deliver to the Company the Put Dollar Amount
for such Put Closing on or before the Payment Due Date, then the Investor shall
pay to the Company, in addition to the Put Dollar Amount, an amount (the "Late
Payment Amount") at a rate of X% per month, accruing daily, multiplied by such
Put Dollar Amount, where "X" equals one percent (1%) for the first month
following the date in question, and increases by an additional one percent (1%)
for each month that passes after the date in question, up to a maximum of five
percent (5%) per month; provided, however, that in no event shall the amount of
interest that shall become due and payable hereunder exceed the maximum amount
permissible under applicable law.

                           2.3.9 Limitation on Short Sales. The Investor and its
Affiliates shall not engage in short sales of the Company's Common Stock;
provided, however, that the Investor may enter into any short exempt sale or any
short sale or other hedging or similar arrangement it deems appropriate with
respect to Put Shares after it receives a Put Notice with respect to such Put
Shares so long as such sales or arrangements do not involve more than the number
of such Put Shares specified in the Put Notice.

                           2.3.10 Cap Amount. Unless the Company has obtained
Stockholder 20% Approval as set forth in Section 6.11 or unless otherwise
permitted by Nasdaq, in no event shall the Aggregate Issued Shares exceed the
maximum number of shares of Common Stock (the "Cap Amount") that the Company
can, without stockholder approval, so issue pursuant to Nasdaq Rule
4460(i)(1)(d)(ii) (or any other applicable Nasdaq Rules or any successor rule)
(the "Nasdaq 20% Rule").

                           2.3.11  Put Cancellation.

                                    (a) Mechanics of Put Cancellation. If at any
time during a Pricing Period the Company discovers the existence of Material
Facts or any Ineffective Period or Delisting Event occurs, the Company shall
cancel the Put (a "Put Cancellation"), by delivering written notice to the
Investor (the "Put Cancellation Notice"), attached as Exhibit Q, by facsimile
and overnight courier. The "Put Cancellation Date" shall be the date that the
Put Cancellation Notice is first received by the Investor, if such notice is
received by the Investor by 6:00 p.m., New York, NY time, and shall be the
following date, if such notice is received by the Investor after 6:00 p.m., New
York, NY time.

                                    (b) Effect of Put Cancellation. Anytime a
Put Cancellation Notice is delivered to Investor after the Put Date, the Put,
shall remain effective with respect to a number of Put Shares (the "Truncated
Put Share Amount") equal to the Individual Put Limit for the Truncated Pricing
Period.

                                    (c) Put Cancellation Notice Confirmation.
Upon receipt by the Investor of a facsimile copy of the Put Cancellation Notice,
the Investor shall promptly send, via facsimile, a confirmation of receipt (the
"Put Cancellation Notice Confirmation," a form of which is attached as Exhibit
S) of the Put Cancellation Notice to the Company specifying that the Put
Cancellation Notice has been received and affirming the Put Cancellation Date.

                                    (d) Truncated Pricing Period. If a Put
Cancellation Notice has been delivered to the Investor after the Put Date, the
Pricing Period for such Put shall end at on the close of trading on the last
full trading day on the Principal Market that ends prior to the moment of
initial delivery of the Put Cancellation Notice (a "Truncated Pricing Period")
to the Investor.

                                       16
<PAGE>

                           2.3.12 Investment Agreement Cancellation. The Company
may terminate (a "Company Termination") its right to initiate future Puts by
providing written notice ("Termination Notice") to the Investor, by facsimile
and overnight courier, at any time other than during an Extended Put Period,
provided that such termination shall have no effect on the parties' other rights
and obligations under this Agreement, the Registration Rights Agreement or the
Warrants. Notwithstanding the above, any cancellation occurring during an
Extended Put Period is governed by Section 2.3.11.

                           2.3.13 Return of Excess Common Shares. In the event
that the number of Shares purchased by the Investor pursuant to its obligations
hereunder is less than the Intended Put Share Amount, the Investor shall
promptly return to the Company any shares of Common Stock in the Investor's
possession that are not being purchased by the Investor.

                  2.4  Warrants.

                           2.4.1 Commitment Warrants. In partial consideration
hereof, following the execution of the Letter of Agreement dated on or about
March 17, 2000 between the Company and the Investor, the Company issued and
delivered to Investor or its designated assignees, warrants (the "Commitment
Warrants") in the form attached hereto as Exhibit U, or such other form as
agreed upon by the parties, to purchase 625,000 shares of Common Stock. Each
Commitment Warrant shall be immediately exercisable at the Commitment Warrant
Exercise Price, and shall have a term beginning on the date of issuance and
ending on the date that is five (5) years thereafter. The Warrant Shares shall
be registered for resale pursuant to the Registration Rights Agreement. The
Investment Commitment Opinion of Counsel shall cover the issuance of the
Commitment Warrant and the issuance of the common stock upon exercise of the
Commitment Warrant.

         Notwithstanding any Termination or Automatic Termination of this
Agreement, regardless of whether or not the Registration Statment is or is not
filed, and regardless of whether or not the Registration Statement is approved
or denied by the SEC, the Investor shall retain full ownership of the Commitment
Warrant as partial consideration for its commitment hereunder.

                           2.4.2 Purchase Warrants. Within five (5) Business
Days of the end of each Pricing Period, the Company shall issue and deliver to
the Investor a warrant ("Purchase Warrant"), in the form attached hereto as
Exhibit D, or such other form as agreed upon by the parties, to purchase a
number of shares of Common Stock equal to 10% of the Put Share Amount for that
Put. Each Purchase Warrant shall be exerciseable at a price (the "Purchase
Warrant Exercise Price") which shall initially equal 110% of the Market Price
for the applicable Put, and shall have annual reset provisions. Each Purchase
Warrant shall be immediately exercisable at the Purchase Warrant Exercise Price,
and shall have a term beginning on the date of issuance and ending on the date
that is five (5) years thereafter. The Warrant Shares shall be registered for
resale pursuant to the Registration Rights Agreement.

                  2.5 Due Diligence Review. The Company shall make available for
inspection and review by the Investor (the "Due Diligence Review"), advisors to
and representatives of the Investor (who may or may not be affiliated with the
Investor and who are reasonably acceptable to the Company), any underwriter
participating in any disposition of Common Stock on behalf of the Investor
pursuant to the Registration Statement, any Supplemental Registration Statement,
or amendments or supplements thereto or any blue sky, NASD or other filing, all
financial and other records, all SEC Documents and other filings with the SEC,
and all other corporate documents and properties of the Company as may be
reasonably necessary for the purpose of such review, and cause the Company's
officers, directors and employees to supply all such information reasonably
requested by the Investor or any such representative, advisor or underwriter in

                                       17
<PAGE>

connection with such Registration Statement (including, without limitation, in
response to all questions and other inquiries reasonably made or submitted by
any of them), prior to and from time to time after the filing and effectiveness
of the Registration Statement for the sole purpose of enabling the Investor and
such representatives, advisors and underwriters and their respective accountants
and attorneys to conduct initial and ongoing due diligence with respect to the
Company and the accuracy of the Registration Statement.

                           2.5.1 Treatment of Nonpublic Information. The Company
shall not disclose nonpublic information to the Investor or to its advisors or
representatives unless prior to disclosure of such information the Company
identifies such information as being nonpublic information and provides the
Investor and such advisors and representatives with the opportunity to accept or
refuse to accept such nonpublic information for review. The Company may, as a
condition to disclosing any nonpublic information hereunder, require the
Investor and its advisors and representatives to enter into a confidentiality
agreement (including an agreement with such advisors and representatives
prohibiting them from trading in Common Stock during such period of time as they
are in possession of nonpublic information) in form reasonably satisfactory to
the Company and the Investor.

        Nothing herein shall require the Company to disclose nonpublic
information to the Investor or its advisors or representatives, and the Company
represents that it does not disseminate nonpublic information to any investors
who purchase stock in the Company in a public offering, to money managers or to
securities analysts, provided, however, that notwithstanding anything herein to
the contrary, the Company will, as hereinabove provided, immediately notify the
advisors and representatives of the Investor and, if any, underwriters, of any
event or the existence of any circumstance (without any obligation to disclose
the specific event or circumstance) of which it becomes aware, constituting
nonpublic information (whether or not requested of the Company specifically or
generally during the course of due diligence by and such persons or entities),
which, if not disclosed in the Prospectus included in the Registration
Statement, would cause such Prospectus to include a material misstatement or to
omit a material fact required to be stated therein in order to make the
statements therein, in light of the circumstances in which they were made, not
misleading. Nothing contained in this Section 2.5 shall be construed to mean
that such persons or entities other than the Investor (without the written
consent of the Investor prior to disclosure of such information) may not obtain
nonpublic information in the course of conducting due diligence in accordance
with the terms of this Agreement; provided, however, that in no event shall the
Investor's advisors or representatives disclose to the Investor the nature of
the specific event or circumstances constituting any nonpublic information
discovered by such advisors or representatives in the course of their due
diligence without the written consent of the Investor prior to disclosure of
such information.

                           2.5.2 Disclosure of Misstatements and Omissions. The
Investor's advisors or representatives shall make complete disclosure to the
Investor's counsel of all events or circumstances constituting nonpublic
information discovered by such advisors or representatives in the course of
their due diligence upon which such advisors or representatives form the opinion
that the Registration Statement contains an untrue statement of a material fact
or omits a material fact required to be stated in the Registration Statement or
necessary to make the statements contained therein, in the light of the
circumstances in which they were made, not misleading. Upon receipt of such
disclosure, the Investor's counsel shall consult with the Company's independent
counsel in order to address the concern raised as to the existence of a material
misstatement or omission and to discuss appropriate disclosure with respect
thereto; provided, however, that such consultation shall not constitute the
advice of the Company's independent counsel to the Investor as to the accuracy
of the Registration Statement and related Prospectus.

                           2.5.3 Procedure if Material Facts are Reasonably
Believed to be Untrue or are Omitted. In the event after such consultation the
Investor or the Investor's counsel reasonably believes that the Registration
Statement contains an untrue statement or material fact or omits a material fact
required to be stated in the Registration Statement or necessary to make the

                                       18
<PAGE>

statements contained therein, in light of the circumstances in which they were
made, not misleading,

                                            (a) the Company shall file with the
SEC an amendment to the Registration Statement responsive to such alleged untrue
statement or omission and provide the Investor, as promptly as practicable, with
copies of the Registration Statement and related Prospectus, as so amended, or

                                            (b) if the Company disputes the
existence of any such material misstatement or omission, (i) the Company's
independent counsel shall provide the Investor's counsel with a Registration
Opinion and (ii) in the event the dispute relates to the adequacy of financial
disclosure and the Investor shall reasonably request, the Company's independent
auditors shall provide to the Company a letter ("Agreed Upon Procedures Report")
outlining the performance of such "agreed upon procedures" as shall be
reasonably requested by the Investor and the Company shall provide the Investor
with a copy of such letter.

                  2.6 Commitment Payments.

         On the last Business Day of each six (6) Calendar Month period
following the Effective Date (each such period a "Commitment Evaluation
Period"), if the Company has not Put at least $1,000,000 in aggregate Put Dollar
Amount during that Commitment Evaluation Period, the Company, in consideration
of Investor's commitment costs, including, but not limited to, due diligence
expenses, shall pay to the Investor an amount (the "Semi-Annual Non-Usage Fee ")
equal to the difference of (i) $100,000, minus (ii) 10% of the aggregate Put
Dollar Amount of the Put Shares put to Investor during that Commitment
Evaluation Period. In the event that the Company delivers a Termination Notice
to the Investor or an Automatic Termination occurs, the Company shall pay to the
Investor (the "Termination Fee") the greater of (i) the Semi-Annual Non-Usage
Fee for the applicable Commitment Evaluation Period, or (ii) the difference of
(x) $200,000, minus (y) 10% of the aggregate Put Dollar Amount of the Put Shares
put to Investor during all Puts to date, and the Company shall not be required
to pay the Semi-Annual Non-Usage Fee thereafter.

         Each Semi Annual Non-Usage Fee or Termination Fee is payable, in cash,
within five (5) business days of the date it accrued. The Company shall not be
required to deliver any payments to Investor under this subsection until
Investor has paid all Put Dollar Amounts that are then due.

         3. Representations, Warranties and Covenants of Investor. Investor
hereby represents and warrants to and agrees with the Company as follows:

                  3.1 Accredited Investor. Investor is an accredited investor
("Accredited Investor"), as defined in Rule 501 of Regulation D, and has checked
the applicable box set forth in Section 10 of this Agreement.

                                       19

<PAGE>

                  3.2 Investment Experience; Access to Information; Independent
Investigation.

                           3.2.1 Access to Information. Investor or Investor's
professional advisor has been granted the opportunity to ask questions of and
receive answers from representatives of the Company, its officers, directors,
employees and agents concerning the terms and conditions of this Offering, the
Company and its business and prospects, and to obtain any additional information
which Investor or Investor's professional advisor deems necessary to verify the
accuracy and completeness of the information received.

                           3.2.2 Reliance on Own Advisors. Investor has relied
completely on the advice of, or has consulted with, Investor's own personal tax,
investment, legal or other advisors and has not relied on the Company or any of
its affiliates, officers, directors, attorneys, accountants or any affiliates of
any thereof and each other person, if any, who controls any of the foregoing,
within the meaning of Section 15 of the Act for any tax or legal advice (other
than reliance on information in the Disclosure Documents as defined in Section
3.2.4 below and on the Opinion of Counsel). The foregoing, however, does not
limit or modify Investor's right to rely upon covenants, representations and
warranties of the Company in this Agreement.

                           3.2.3 Capability to Evaluate. Investor has such
knowledge and experience in financial and business matters so as to enable such
Investor to utilize the information made available to it in connection with the
Offering in order to evaluate the merits and risks of the prospective
investment, which are substantial, including without limitation those set forth
in the Disclosure Documents (as defined in Section 3.2.4 below).

                           3.2.4 Disclosure Documents. Investor, in making
Investor's investment decision to subscribe for the Investment Agreement
hereunder, represents that (a) Investor has received and had an opportunity to
review (i) the Company's Annual Report on Form 10-K for the year ended December
31, 1999, (ii) the Company's quarterly report on Form 10-Q for the quarter ended
September 30, 1999, (iii) the Risk Factors, attached as Exhibit J, (the "Risk
Factors") (iv) the Capitalization Schedule, attached as Exhibit K, (the
"Capitalization Schedule") and (v) the Use of Proceeds Schedule, attached as
Exhibit L, (the "Use of Proceeds Schedule"); (b) Investor has read, reviewed,
and relied solely on the documents described in (a) above, the Company's
representations and warranties and other information in this Agreement,
including the exhibits, documents prepared by the Company which have been
specifically provided to Investor in connection with this Offering (the
documents described in this Section 3.2.4 (a) and (b) are collectively referred
to as the "Disclosure Documents"), and an independent investigation made by
Investor and Investor's representatives, if any; (c) Investor has, prior to the
date of this Agreement, been given an opportunity to review material contracts
and documents of the Company which have been filed as exhibits to the Company's
filings under the Act and the Securities Exchange Act of 1934, as amended (the
"Exchange Act") and has had an opportunity to ask questions of and receive
answers from the Company's officers and directors; and (d) is not relying on any
oral representation of the Company or any other person, nor any written
representation or assurance from the Company other than those contained in the
Disclosure Documents or incorporated herein or therein. The foregoing, however,
does not limit or modify Investor's right to rely upon covenants,
representations and warranties of the Company in Sections 5 and 6 of this
Agreement. Investor acknowledges and agrees that the Company has no
responsibility for, does not ratify, and is under no responsibility whatsoever
to comment upon or correct any reports, analyses or other comments made about
the Company by any third parties, including, but not limited to, analysts'
research reports or comments (collectively, "Third Party Reports"), and Investor
has not relied upon any Third Party Reports in making the decision to invest.

                           3.2.5 Investment Experience; Fend for Self. Investor
has substantial experience in investing in securities and it has made
investments in securities other than those of the Company. Investor acknowledges
that Investor is able to fend for Investor's self in the transaction
contemplated by this Agreement, that Investor has the ability to bear the
economic risk of Investor's investment pursuant to this Agreement and that
Investor is an "Accredited Investor" by virtue of the fact that Investor meets
the investor qualification standards set forth in Section 3.1 above. Investor

                                       20
<PAGE>

has not been organized for the purpose of investing in securities of the
Company, although such investment is consistent with Investor's purposes.

                  3.3  Exempt Offering Under Regulation D.

                           3.3.1 No General Solicitation. The Investment
Agreement was not offered to Investor through, and Investor is not aware of, any
form of general solicitation or general advertising, including, without
limitation, (i) any advertisement, article, notice or other communication
published in any newspaper, magazine or similar media or broadcast over
television or radio, and (ii) any seminar or meeting whose attendees have been
invited by any general solicitation or general advertising.

                           3.3.2 Restricted Securities. Investor understands
that the Investment Agreement is, the Common Stock and Warrants issued at each
Put Closing will be, and the Warrant Shares will be, characterized as
"restricted securities" under the federal securities laws inasmuch as they are
being acquired from the Company in a transaction exempt from the registration
requirements of the federal securities laws and that under such laws and
applicable regulations such securities may not be transferred or resold without
registration under the Act or pursuant to an exemption therefrom. In this
connection, Investor represents that Investor is familiar with Rule 144 under
the Act, as presently in effect, and understands the resale limitations imposed
thereby and by the Act.

                           3.3.3 Disposition. Without in any way limiting the
representations set forth above, Investor agrees that until the Securities are
sold pursuant to an effective Registration Statement or an exemption from
registration, they will remain in the name of Investor and will not be
transferred to or assigned to any broker, dealer or depositary. Investor further
agrees not to sell, transfer, assign, or pledge the Securities (except for any
bona fide pledge arrangement to the extent that such pledge does not require
registration under the Act or unless an exemption from such registration is
available and provided further that if such pledge is realized upon, any
transfer to the pledgee shall comply with the requirements set forth herein), or
to otherwise dispose of all or any portion of the Securities unless and until:

                                    (a) There is then in effect a registration
statement under the Act and any applicable state securities laws covering such
proposed disposition and such disposition is made in accordance with such
registration statement and in compliance with applicable prospectus delivery
requirements; or

                                    (b) (i) Investor shall have notified the
Company of the proposed disposition and shall have furnished the Company with a
statement of the circumstances surrounding the proposed disposition to the
extent relevant for determination of the availability of an exemption from
registration, and (ii) if reasonably requested by the Company, Investor shall
have furnished the Company with an opinion of counsel, reasonably satisfactory
to the Company, that such disposition will not require registration of the
Securities under the Act or state securities laws. It is agreed that the Company
will not require the Investor to provide opinions of counsel for transactions
made pursuant to Rule 144 provided that Investor and Investor's broker, if
necessary, provide the Company with the necessary representations for counsel to
the Company to issue an opinion with respect to such transaction.

                  The Investor is entering into this Agreement for its own
account and the Investor has no present arrangement (whether or not legally
binding) at any time to sell the Common Stock to or through any person or
entity; provided, however, that by making the representations herein, the
Investor does not agree to hold the Common Stock for any minimum or other
specific term and reserves the right to dispose of the Common Stock at any time
in accordance with federal and state securities laws applicable to such
disposition.

                  3.4  Due Authorization.

                                       21
<PAGE>

                           3.4.1 Authority. The person executing this Investment
Agreement, if executing this Agreement in a representative or fiduciary
capacity, has full power and authority to execute and deliver this Agreement and
each other document included herein for which a signature is required in such
capacity and on behalf of the subscribing individual, partnership, trust,
estate, corporation or other entity for whom or which Investor is executing this
Agreement. Investor has reached the age of majority (if an individual) according
to the laws of the state in which he or she resides.

                           3.4.2 Due Authorization. Investor is duly and validly
organized, validly existing and in good standing as a limited liability company
under the laws of Georgia with full power and authority to purchase the
Securities to be purchased by Investor and to execute and deliver this
Agreement.

                           3.4.3 Partnerships. If Investor is a partnership, the
representations, warranties, agreements and understandings set forth above are
true with respect to all partners of Investor (and if any such partner is itself
a partnership, all persons holding an interest in such partnership, directly or
indirectly, including through one or more partnerships), and the person
executing this Agreement has made due inquiry to determine the truthfulness of
the representations and warranties made hereby.

                           3.4.4 Representatives. If Investor is purchasing in a
representative or fiduciary capacity, the representations and warranties shall
be deemed to have been made on behalf of the person or persons for whom Investor
is so purchasing.

         4.       Acknowledgments   Investor is aware that:

                  4.1 Risks of Investment. Investor recognizes that an
investment in the Company involves substantial risks, including the potential
loss of Investor's entire investment herein. Investor recognizes that the
Disclosure Documents, this Agreement and the exhibits hereto do not purport to
contain all the information, which would be contained in a registration
statement under the Act;

                  4.2 No Government Approval. No federal or state agency has
passed upon the Securities, recommended or endorsed the Offering, or made any
finding or determination as to the fairness of this transaction;

                  4.3 No Registration, Restrictions on Transfer. As of the date
of this Agreement, the Securities and any component thereof have not been
registered under the Act or any applicable state securities laws by reason of
exemptions from the registration requirements of the Act and such laws, and may
not be sold, pledged (except for any limited pledge in connection with a margin
account of Investor to the extent that such pledge does not require registration
under the Act or unless an exemption from such registration is available and
provided further that if such pledge is realized upon, any transfer to the
pledgee shall comply with the requirements set forth herein), assigned or
otherwise disposed of in the absence of an effective registration of the
Securities and any component thereof under the Act or unless an exemption from
such registration is available;

                  4.4 Restrictions on Transfer. Investor may not attempt to
sell, transfer, assign, pledge or otherwise dispose of all or any portion of the
Securities or any component thereof in the absence of either an effective
registration statement or an exemption from the registration requirements of the
Act and applicable state securities laws;

                  4.5 No Assurances of Registration. There can be no assurance
that any registration statement will become effective at the scheduled time, or
ever, or remain effective when required, and Investor acknowledges that it may
be required to bear the economic risk of Investor's investment for an indefinite
period of time;

                                       22
<PAGE>

                  4.6 Exempt Transaction. Investor understands that the
Securities are being offered and sold in reliance on specific exemptions from
the registration requirements of federal and state law and that the
representations, warranties, agreements, acknowledgments and understandings set
forth herein are being relied upon by the Company in determining the
applicability of such exemptions and the suitability of Investor to acquire such
Securities.

                  4.7 Legends. The certificates representing the Put Shares
shall not bear a Restrictive Legend. The certificates representing the Warrant
Shares shall not bear a Restrictive Legend unless they are issued at a time when
the Registration Statement is not effective for resale. It is understood that
the certificates evidencing any Warrant Shares issued at a time when the
Registration Statement is not effective for resale, subject to legend removal
under the terms of Section 6.8 below, shall bear the following legend (the
"Legend"):

         "The securities represented hereby have not been registered under the
         Securities Act of 1933, as amended, or applicable state securities
         laws, nor the securities laws of any other jurisdiction. They may not
         be sold or transferred in the absence of an effective registration
         statement under those securities laws or pursuant to an exemption
         therefrom."

         5. Representations and Warranties of the Company. The Company hereby
makes the following representations and warranties to Investor (which shall be
true at the signing of this Agreement, and as of any such later date as
contemplated hereunder) and agrees with Investor that, except as set forth in
the "Schedule of Exceptions" annexed hereto as Exhibit C and made a part hereof:

                  5.1 Organization, Good Standing, and Qualification. The
Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Florida, USA and has all requisite corporate
power and authority to carry on its business as now conducted and as proposed to
be conducted. The Company is duly qualified to transact business and is in good
standing in each jurisdiction in which the failure to so qualify would have a
material adverse effect on the business or properties of the Company and its
subsidiaries taken as a whole. The Company is not the subject of any pending,
threatened or, to its knowledge, contemplated investigation or administrative or
legal proceeding (a "Proceeding") by the Internal Revenue Service, the taxing
authorities of any state or local jurisdiction, or the Securities and Exchange
Commission, The National Association of Securities Dealer, Inc., The Nasdaq
Stock Market, Inc. or any state securities commission, or any other governmental
entity, which have not been disclosed in the Disclosure Documents. None of the
disclosed Proceedings, if any, will have a material adverse effect upon the
Company or the market for the Common Stock. The Company has the following
subsidiaries: Health-Mark Diagnostics, LLC, a Delaware limited libility
corporation, Health Test, Inc., a Florida corporation, TCPI, Inc., a Florida
corporation and Technical Electronics Corporation, a Florida corporation.

                  5.2 Corporate Condition. The Company's condition is, in all
material respects, as described in the Disclosure Documents (as further set
forth in any subsequently filed Disclosure Documents, if applicable), except for
changes in the ordinary course of business and normal year-end adjustments that
are not, in the aggregate, materially adverse to the Company. Except for
continuing losses, there have been no material adverse changes to the Company's
business, financial condition, or prospects since the dates of such Disclosure
Documents. The financial statements as contained in the 10-K and 10-Q have been
prepared in accordance with generally accepted accounting principles,
consistently applied (except as otherwise permitted by Regulation S-X of the
Exchange Act), subject, in the case of unaudited interim financial statements,
to customary year end adjustments and the absence of certain footnotes, and
fairly present the financial condition of the Company as of the dates of the
balance sheets included therein and the consolidated results of its operations
and cash flows for the periods then ended. Without limiting the foregoing, there
are no material liabilities, contingent or actual, that are not disclosed in the
Disclosure Documents (other than liabilities incurred by the Company in the

                                       23
<PAGE>

ordinary course of its business, consistent with its past practice, after the
period covered by the Disclosure Documents). The Company has paid all material
taxes that are due, except for taxes that it reasonably disputes. There is no
material claim, litigation, or administrative proceeding pending or, to the best
of the Company's knowledge, threatened against the Company, except as disclosed
in the Disclosure Documents. This Agreement and the Disclosure Documents do not
contain any untrue statement of a material fact and do not omit to state any
material fact required to be stated therein or herein necessary to make the
statements contained therein or herein not misleading in the light of the
circumstances under which they were made. No event or circumstance exists
relating to the Company which, under applicable law, requires public disclosure
but which has not been so publicly announced or disclosed.

                  5.3 Authorization. All corporate action on the part of the
Company by its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement, the performance of all
obligations of the Company hereunder and the authorization, issuance and
delivery of the Common Stock being sold hereunder and the issuance (and/or the
reservation for issuance) of the Warrants and the Warrant Shares have been
taken, and this Agreement and the Registration Rights Agreement constitute valid
and legally binding obligations of the Company, enforceable in accordance with
their terms, except insofar as the enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, or other similar laws affecting
creditors' rights generally or by principles governing the availability of
equitable remedies. The Company has obtained all consents and approvals required
for it to execute, deliver and perform each agreement referenced in the previous
sentence.

                  5.4 Valid Issuance of Common Stock. The Common Stock and the
Warrants, when issued, sold and delivered in accordance with the terms hereof,
for the consideration expressed herein, will be validly issued, fully paid and
nonassessable and, based in part upon the representations of Investor in this
Agreement, will be issued in compliance with all applicable U.S. federal and
state securities laws. The Warrant Shares, when issued in accordance with the
terms of the Warrants, shall be duly and validly issued and outstanding, fully
paid and nonassessable, and based in part on the representations and warranties
of Investor, will be issued in compliance with all applicable U.S. federal and
state securities laws. The Put Shares, the Warrants and the Warrant Shares will
be issued free of any preemptive rights.

                  5.5 Compliance with Other Instruments. The Company is not in
violation or default of any provisions of its Certificate of Incorporation or
Bylaws, each as amended and in effect on and as of the date of the Agreement, or
of any material provision of any material instrument or material contract to
which it is a party or by which it is bound or of any provision of any federal
or state judgment, writ, decree, order, statute, rule or governmental regulation
applicable to the Company, which would have a material adverse effect on the
Company's business or prospects, or on the performance of its obligations under
this Agreement or the Registration Rights Agreement. The execution, delivery and
performance of this Agreement and the other agreements entered into in
conjunction with the Offering and the consummation of the transactions
contemplated hereby and thereby will not (a) result in any such violation or be
in conflict with or constitute, with or without the passage of time and giving
of notice, either a default under any such provision, instrument or contract or
an event which results in the creation of any lien, charge or encumbrance upon
any assets of the Company, which would have a material adverse effect on the
Company's business or prospects, or on the performance of its obligations under
this Agreement, the Registration Rights Agreement, (b) violate the Company's
Certificate of Incorporation or By-Laws or (c) violate any statute, rule or
governmental regulation applicable to the Company which violation would have a
material adverse effect on the Company's business or prospects.

                  5.6 Reporting Company. The Company is subject to the reporting
requirements of the Exchange Act, has a class of securities registered under
Section 12 of the Exchange Act, and has filed all reports required by the
Exchange Act since the date the Company first became subject to such reporting
obligations. The Company undertakes to furnish Investor with copies of such

                                       24
<PAGE>

reports as may be reasonably requested by Investor prior to consummation of this
Offering and thereafter, to make such reports available, for the full term of
this Agreement, including any extensions thereof, and for as long as Investor
holds the Securities. The Common Stock is duly listed on the NMS. The Company is
not in violation of the listing requirements of the NMS and does not reasonably
anticipate that the Common Stock will be delisted by the NMS for the foreseeable
future. The Company has filed all reports required under the Exchange Act. The
Company has not furnished to the Investor any material nonpublic information
concerning the Company.

                  5.7 Capitalization. The capitalization of the Company as of
the date hereof, is, and the capitalization as of the Closing, subject to
exercise of any outstanding warrants and/or exercise of any outstanding stock
options, after taking into account the offering of the Securities contemplated
by this Agreement and all other share issuances occurring prior to this
Offering, will be, as set forth in the Capitalization Schedule as set forth in
Exhibit K. There are no securities or instruments containing anti-dilution or
similar provisions that will be triggered by the issuance of the Securities.
Except as disclosed in the Capitalization Schedule, as of the date of this
Agreement, (i) there are no outstanding options, warrants, scrip, rights to
subscribe for, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into or exercisable or exchangeable for, any
shares of capital stock of the Company or any of its subsidiaries, or
arrangements by which the Company or any of its subsidiaries is or may become
bound to issue additional shares of capital stock of the Company or any of its
subsidiaries, and (ii) there are no agreements or arrangements under which the
Company or any of its subsidiaries is obligated to register the sale of any of
its or their securities under the Act (except the Registration Rights
Agreement).

                  5.8 Intellectual Property. The Company has valid, unrestricted
and exclusive ownership of or rights to use the patents, trademarks, trademark
registrations, trade names, copyrights, know-how, technology and other
intellectual property necessary to the conduct of its business. The Company has
granted such licenses or has assigned or otherwise transferred a portion of (or
all of) such valid, unrestricted and exclusive patents, trademarks, trademark
registrations, trade names, copyrights, know-how, technology and other
intellectual property necessary to the conduct of its business. The Company has
been granted licenses, know-how, technology and/or other intellectual property
necessary to the conduct of its business. To the best of the Company's knowledge
after due inquiry, the Company is not infringing on the intellectual property
rights of any third party, nor is any third party infringing on the Company's
intellectual property rights. There are no restrictions in any agreements,
licenses, franchises, or other instruments that preclude the Company from
engaging in its business as presently conducted.

                  5.9 Use of Proceeds. As of the date hereof, the Company
expects to use the proceeds from this Offering (less fees and expenses) for the
purposes and in the approximate amounts set forth on the Use of Proceeds
Schedule set forth as Exhibit L hereto. These purposes and amounts are estimates
and are subject to change without notice to any Investor.

                  5.10 No Rights of Participation. No person or entity,
including, but not limited to, current or former stockholders of the Company,
underwriters, brokers, agents or other third parties, has any right of first
refusal, preemptive right, right of participation, or any similar right to
participate in the financing contemplated by this Agreement which has not been
waived.

                  5.11 Company Acknowledgment. The Company hereby acknowledges
that Investor may elect to hold the Securities for various periods of time, as
permitted by the terms of this Agreement, the Warrants, and other agreements
contemplated hereby, and the Company further acknowledges that Investor has made
no representations or warranties, either written or oral, as to how long the
Securities will be held by Investor or regarding Investor's trading history or
investment strategies.

                                       25
<PAGE>

                  5.12 No Advance Regulatory Approval. The Company acknowledges
that this Investment Agreement, the transaction contemplated hereby and the
Registration Statement contemplated hereby have not been approved by the SEC, or
any other regulatory body and there is no guarantee that this Investment
Agreement, the transaction contemplated hereby and the Registration Statement
contemplated hereby will ever be approved by the SEC or any other regulatory
body. The Company is relying on its own analysis and is not relying on any
representation by Investor that either this Investment Agreement, the
transaction contemplated hereby or the Registration Statement contemplated
hereby has been or will be approved by the SEC or other appropriate regulatory
body.

                  5.13 Underwriter's Fees and Rights of First Refusal. The
Company is not obligated to pay any compensation or other fees, costs or related
expenditures in cash or securities to any underwriter, broker, agent or other
representative other than the Investor in connection with this Offering.

                  5.14 Availability of Suitable Form for Registration. The
Company is currently eligible and agrees to maintain its eligibility to register
the resale of its Common Stock on a registration statement on a suitable form
under the Act.

                  5.15 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 of the Company's securities or
solicited any offers to buy any security under circumstances that would prevent
the parties hereto from consummating the transactions contemplated hereby
pursuant to an exemption from registration under Regulation D of the Act or
would require the issuance of any other securities to be integrated with this
Offering under the Rules of Nasdaq. The Company has not engaged in any form of
general solicitation or advertising in connection with the offering of the
Common Stock or the Warrants.

                  5.16 Foreign Corrupt Practices. Neither the Company, nor any
of its subsidiaries, nor any director, officer, agent, employee or other person
acting on behalf of the Company or any subsidiary has, in the course of its
actions for, or on behalf of, the Company, used any corporate funds for any
unlawful contribution, gift, entertainment or other unlawful expenses relating
to political activity; made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds;
violated or is in violation of any provision of the U.S. Foreign Corrupt
Practices Act of 1977, as amended; or made any bribe, rebate, payoff, influence
payment, kickback or other unlawful payment to any foreign or domestic
government official or employee.

                  5.17 Key Employees. Each "Key Employee" (as defined in Exhibit
N) is currently serving the Company in the capacity disclosed in Exhibit N. No
Key Employee, to the best knowledge of the Company and its subsidiaries, is, or
is now expected to be, in violation of any material term of any employment
contract, confidentiality, disclosure or proprietary information agreement,
non-competition agreement, or any other contract or agreement or any restrictive
covenant, and the continued employment of each Key Employee does not subject the
Company or any of its subsidiaries to any liability with respect to any of the
foregoing matters. No Key Employee has, to the best knowledge of the Company and
its subsidiaries, any intention to terminate his employment with, or services
to, the Company or any of its subsidiaries.

                  5.18 Representations Correct. The foregoing representations,
warranties and agreements are true, correct and complete in all material
respects, and shall survive any Put Closing and the issuance of the shares of
Common Stock thereby.

                  5.19 Tax Status. The Company has made or filed all federal and
state income and all other tax returns, reports and declarations required by any
jurisdiction to which it is subject (unless and only to the extent that the
Company has set aside on its books provisions reasonably adequate for the
payment of all unpaid and unreported taxes) and has paid all taxes and other

                                       26
<PAGE>

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 as 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.

                  5.20 Transactions With Affiliates. Except as set forth in the
Disclosure 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.

                  5.21 Application of Takeover Protections. The Company and its
board of directors have adopted, as reflected in the Company's Articles of
Incorpration and By-Laws, certain takeover protections. The Company has not
adopted any "poison pill" provision that will be applicable to Investor as a
result of transactions contemplated by this Agreement.

                  5.22 Other Agreements. The Company has not, directly or
indirectly, made any agreements with the Investor under a subscription in the
form of this Agreement for the purchase of Common Stock, relating to the terms
or conditions of the transactions contemplated hereby or thereby except as
expressly set forth herein, respectively, or in exhibits hereto or thereto.

                  5.23 Major Transactions. There are no other Major Transactions
currently pending or contemplated by the Company that have not been disclosed to
the Investor pursuant to a confidentiality agreement.

                  5.24 Financings. There are no other financings currently
pending or contemplated by the Company that have not been disclosed to the
Investor pursuant to a confidentiality agreement.

                  5.25 Shareholder Authorization. The Company shall, at its next
annual shareholder meeting, or at a special meeting to be held as soon as
practicable thereafter, use its best efforts to obtain approval of its
shareholders to (i) authorize the issuance of the full number of shares of
Common Stock which would be issuable under this Agreement and eliminate any
prohibitions under applicable law or the rules or regulations of any stock
exchange, interdealer quotation system or other self-regulatory organization
with jurisdiction over the Company or any of its securities with respect to the
Company's ability to issue shares of Common Stock in excess of the Cap Amount
(such approvals being the "20% Approval") and (ii) the increase in the number of
authorized shares of Common Stock of the Company (the "Share Authorization
Increase Approval") such that at least 25,000,000 shares can be reserved for
this Offering. In connection with such shareholder vote, the Company shall use
its best efforts to cause all officers and directors of the Company to promptly
enter into irrevocable agreements to vote all of their shares in favor of
eliminating such prohibitions. As soon as practicable after the 20% Approval and
the Share Authorization Increase Approval, the Company agrees to use its best
efforts to reserve at least 25,000,000 shares of Common Stock for issuance under
this Agreement.

                  5.26 Acknowledgment of Limitations on Put Amounts. The Company
understands and acknowledges that the amounts available under this Investment
Agreement are limited, among other things, based upon the liquidity of the
Company's Common Stock traded on its Principal Market.

                                       27
<PAGE>

         6.       Covenants of the Company

                  6.1 Independent Auditors. The Company shall, until at least
the Termination Date, maintain as its independent auditors an accounting firm
authorized to practice before the SEC.

                  6.2 Corporate Existence and Taxes. The Company shall, until at
least the Termination Date, maintain its corporate existence in good standing
and is, and shall remain a "Reporting Issuer" (defined as a Company which files
periodic reports under the Exchange Act) (provided, however, that the foregoing
covenant shall not prevent the Company from entering into any merger or
corporate reorganization as long as the surviving entity in such transaction, if
not the Company, assumes the Company's obligations with respect to the Common
Stock and has Common Stock listed for trading on a stock exchange or on Nasdaq
and is a Reporting Issuer) and shall pay all its taxes when due except for taxes
which the Company disputes.

                  6.3 Registration Rights. The Company will enter into a
registration rights agreement covering the resale of the Common Shares and the
Warrant Shares substantially in the form of the Registration Rights Agreement
attached as Exhibit A.

                  6.4 Asset Transfers. The Company shall not (i) transfer, sell,
convey or otherwise dispose of any of its material assets to any Subsidiary
except for a cash or cash equivalent consideration and for a proper business
purpose or (ii) transfer, sell, convey or otherwise dispose of any of its
material assets to any Affiliate, as defined below, during the Term of this
Agreement. For purposes hereof, "Affiliate" shall mean any officer of the
Company, director of the Company or owner of twenty percent (20%) or more of the
Common Stock or other securities of the Company.

                  6.5  Rights of First Refusal.

                           6.5.1 Capital Raising Limitations. During the period
from the date of this Agreement until the date that is one year after the
Termination Date, the Company shall not issue or sell, or agree to issue or sell
Equity Securities (as defined below), for cash in private capital raising
transactions without obtaining the prior written approval of the Investor of the
Offering (the limitations referred to in this subsection 6.5.1 are collectively
referred to as the "Capital Raising Limitations"). For purposes hereof, the
following shall be collectively referred to herein as, the "Equity Securities":
(i) Common Stock or any other equity securities, (ii) any debt or equity
securities which are convertible into, exercisable or exchangeable for, or carry
the right to receive additional shares of Common Stock or other equity
securities, or (iii) any securities of the Company pursuant to an equity line
structure or format similar in nature to this Offering.

                           6.5.2 Investor's Right of First Refusal. For any
private capital raising transactions of Equity Securities which close after the
date hereof and on or prior to the date that is one (1) year after the
Termination Date of this Agreement, not including any warrants issued in
conjunction with this Investment Agreement, the Company agrees to deliver to
Investor, at least ten (10) days prior to the closing of such transaction,
written notice describing the proposed transaction, including the terms and
conditions thereof, and providing the Investor and its affiliates an option
during the ten (10) day period following delivery of such notice to purchase the
securities being offered in such transaction on the same terms as contemplated
by such transaction.

                           6.5.3 Exceptions to Rights of First Refusal.
Notwithstanding the above, the Rights of First Refusal shall not apply to any
transaction involving issuances of securities in connection with a merger,
consolidation, acquisition or sale of assets, or in connection with any
strategic partnership or joint venture (the primary purpose of which is not to
raise equity capital), or in connection with the disposition or acquisition of a
business, product or license by the Company or exercise of options by employees,
consultants or directors, or a primary underwritten offering of the Company's

                                       28
<PAGE>

Common Stock, or the transactions set forth on Schedule 6.5.1. The Capital
Raising Limitations also shall not apply to (a) the issuance of securities upon
exercise or conversion of the Company's options, warrants or other convertible
securities outstanding as of the date hereof, (b) the grant of additional
options or warrants, or the issuance of additional securities, under any Company
stock option or restricted stock plan for the benefit of the Company's
employees, directors or consultants, or (c) the issuance of debt securities,
with no equity feature, incurred solely for working capital purposes. If the
Investor, at any time, is more than five (5) business days late in paying any
Put Dollar Amounts that are then due, the Investor shall not be entitled to the
benefits of Sections 6.5.1 and 6.5.2 above until the date that the Investor has
paid all Put Dollar Amounts that are then due.

                  6.6 Financial 10-K Statements, Etc. and Current Reports on
Form 8-K. The Company shall deliver to the Investor copies of its annual reports
on Form 10-K, and quarterly reports on Form 10-Q and shall deliver to the
Investor current reports on Form 8-K within two (2) days of filing for the Term
of this Agreement.

                  6.7 Opinion of Counsel. Investor shall, concurrent with the
Investment Commitment Closing, receive an opinion letter from the Company's
legal counsel, in the form attached as Exhibit B, or in such form as agreed upon
by the parties, and shall, concurrent with each Put Date, receive an opinion
letter from the Company's legal counsel, in the form attached as Exhibit I or in
such form as agreed upon by the parties.

                  6.8 Removal of Legend. If the certificates representing any
Securities are issued with a restrictive Legend in accordance with the terms of
this Agreement, the Legend shall be removed and the Company shall issue a
certificate without such Legend to the holder of any Security upon which it is
stamped, and a certificate for a security shall be originally issued without the
Legend, if (a) the sale of such Security is registered under the Act, or (b)
such holder provides the Company with an opinion of counsel, in form, substance
and scope customary for opinions of counsel in comparable transactions (the
reasonable cost of which shall be borne by the Investor), to the effect that a
public sale or transfer of such Security may be made without registration under
the Act, or (c) such holder provides the Company with reasonable assurances that
such Security can be sold pursuant to Rule 144. Each Investor agrees to sell all
Securities, including those represented by a certificate(s) from which the
Legend has been removed, or which were originally issued without the Legend,
pursuant to an effective registration statement and to deliver a prospectus in
connection with such sale or in compliance with an exemption from the
registration requirements of the Act.

                  6.9 Listing. Subject to the remainder of this Section 6.9, the
Company shall ensure that its shares of Common Stock (including all Warrant
Shares and Put Shares) are listed and available for trading on the NMS.
Thereafter, the Company shall (i) use its best efforts to continue the listing
and trading of its Common Stock on the NMS or to become eligible for and listed
and available for trading on the Nasdaq Small Cap Market, or the New York Stock
Exchange ("NYSE"); and (ii) comply in all material respects with the Company's
reporting, filing and other obligations under the By-Laws or rules of the
National Association of Securities Dealers ("NASD") and such exchanges, as
applicable.

                  6.10 The Company's Instructions to Transfer Agent. The Company
will instruct the Transfer Agent of the Common Stock, by delivering instructions
in the form of Exhibit T hereto, to issue certificates, registered in the name
of each Investor or its nominee, for the Put Shares and Warrant Shares in such
amounts as specified from time to time by the Company upon any exercise by the
Company of a Put and/or exercise of the Warrants by the holder thereof. Such
certificates shall not bear a Legend unless issuance with a Legend is permitted
by the terms of this Agreement and Legend removal is not permitted by Section
6.8 hereof and the Company shall cause the Transfer Agent to issue such
certificates without a Legend. Nothing in this Section shall affect in any way
Investor's obligations and agreement set forth in Sections 3.3.2 or 3.3.3 hereof
to resell the Securities pursuant to an effective registration statement and to

                                       29
<PAGE>

deliver a prospectus in connection with such sale or in compliance with an
exemption from the registration requirements of applicable securities laws. If
(a) an Investor provides the Company with an opinion of counsel, which opinion
of counsel shall be in form, substance and scope customary for opinions of
counsel in comparable transactions, to the effect that the Securities to be sold
or transferred may be sold or transferred pursuant to an exemption from
registration or (b) an Investor transfers Securities, pursuant to Rule 144, to a
transferee which is an accredited investor, the Company shall permit the
transfer, and, in the case of Put Shares and Warrant Shares, promptly instruct
its transfer agent to issue one or more certificates in such name and in such
denomination as specified by such Investor. The Company acknowledges that a
breach by it of its obligations hereunder will cause irreparable harm to an
Investor by vitiating the intent and purpose of the transaction contemplated
hereby. Accordingly, the Company acknowledges that the remedy at law for a
breach of its obligations under this Section 6.10 will be inadequate and agrees,
in the event of a breach or threatened breach by the Company of the provisions
of this Section 6.10, that an Investor 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.

                  6.11 Stockholder 20% Approval. Prior to the closing of any Put
that would cause the Aggregate Issued Shares to exceed the Cap Amount, if
required by the rules of NASDAQ because the Company's Common Stock is listed on
NASDAQ, the Company shall obtain approval of its stockholders to authorize (i)
the issuance of the full number of shares of Common Stock which would be
issuable pursuant to this Agreement but for the Cap Amount and eliminate any
prohibitions under applicable law or the rules or regulations of any stock
exchange, interdealer quotation system or other self-regulatory organization
with jurisdiction over the Company or any of its securities with respect to the
Company's ability to issue shares of Common Stock in excess of the Cap Amount
(such approvals being the "Stockholder 20% Approval").

                  6.12 Press Release. The Company agrees that the Investor shall
have the right to review and comment upon any press release issued by the
Company in connection with the Offering which approval shall not be unreasonably
withheld by Investor.

                  6.13 Change in Law or Policy. In the event of a change in law,
or policy of the SEC, as evidenced by a No-Action letter or other written
statements of the SEC or the NASD which causes the Investor to be unable to
perform its obligations hereunder, this Agreement shall be automatically
terminated and no Termination Fee shall be due, provided that notwithstanding
any termination under this section 6.13, the Investor shall retain full
ownership of the Commitment Warrant as partial consideration for its commitment
and its consulting, legal and other services rendered hereunder.

         7.       Investor Covenant/Miscellaneous.

                  7.1 Representations and Warranties Survive the Closing;
Severability. Investor's and the Company's representations and warranties shall
survive the Investment Date and any Put Closing contemplated by this Agreement
notwithstanding any due diligence investigation made by or on behalf of the
party seeking to rely thereon. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, or is altered by a term required by the Securities
Exchange Commission to be included in the Registration Statement, this Agreement
shall continue in full force and effect without said provision; provided that if
the removal of such provision materially changes the economic benefit of this
Agreement to the Investor, this Agreement shall terminate.

                  7.2 Successors and Assigns. This Agreement shall not be
assignable without the Company's written consent. If assigned, the terms and

                                       30
<PAGE>

conditions of this Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties. Nothing in this Agreement,
express or implied, is intended to confer upon any party other than the parties
hereto or their respective successors and assigns any rights, remedies,
obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement. Investor may assign Investor's rights
hereunder, in connection with any private sale of the Common Stock of such
Investor, so long as, as a condition precedent to such transfer, the transferee
executes an acknowledgment agreeing to be bound by the applicable provisions of
this Agreement in a form acceptable to the Company and provides an original copy
of such acknowledgment to the Company.

                  7.3 Execution in Counterparts Permitted. This Agreement may be
executed in any number of counterparts, each of which shall be enforceable
against the parties actually executing such counterparts, and all of which
together shall constitute one (1) instrument.

                  7.4 Titles and Subtitles; Gender. The titles and subtitles
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement. The use in this
Agreement of a masculine, feminine or neither pronoun shall be deemed to include
a reference to the others.

                  7.5 Written Notices, Etc. Any notice, demand or request
required or permitted to be given by the Company or Investor pursuant to the
terms of this Agreement shall be in writing and shall be deemed given when
delivered personally, or by facsimile or upon receipt if by overnight or two (2)
day courier, addressed to the parties at the addresses and/or facsimile
telephone number of the parties set forth at the end of this Agreement or such
other address as a party may request by notifying the other in writing;
provided, however, that in order for any notice to be effective as to the
Investor such notice shall be delivered and sent, as specified herein, to all
the addresses and facsimile telephone numbers of the Investor set forth at the
end of this Agreement or such other address and/or facsimile telephone number as
Investor may request in writing.

                  7.6 Expenses. Except as set forth in the Registration Rights
Agreement, each of the Company and Investor shall pay all costs and expenses
that it respectively incurs, with respect to the negotiation, execution,
delivery and performance of this Agreement.

                  7.7 Entire Agreement; Written Amendments Required. This
Agreement, including the Exhibits attached hereto, the Common Stock
certificates, the Warrants, the Registration Rights Agreement, and the other
documents delivered pursuant hereto constitute the full and entire understanding
and agreement between the parties with regard to the subjects hereof and
thereof, and no party shall be liable or bound to any other party in any manner
by any warranties, representations or covenants, whether oral, written, or
otherwise except as specifically set forth herein or therein. Except as
expressly provided herein, neither this Agreement nor any term hereof may be
amended, waived, discharged or terminated other than by a written instrument
signed by the party against whom enforcement of any such amendment, waiver,
discharge or termination is sought.

                  7.8 Actions at Law or Equity; Jurisdiction and Venue. The
parties acknowledge that any and all actions, whether at law or at equity, and
whether or not said actions are based upon this Agreement between the parties
hereto, shall be filed in any state or federal court sitting in Atlanta,
Georgia. Georgia law shall govern both the proceeding as well as the
interpretation and construction of the Transaction Documents and the transaction
as a whole. In any litigation between the parties hereto, the prevailing party,
as found by the court, shall be entitled to an award of all attorney's fees and
costs of court. Should the court refuse to find a prevailing party, each party
shall bear its own legal fees and costs.

         8.       Subscription and Wiring Instructions; Irrevocability.

                                       31
<PAGE>
                  8.1  Subscription

                  (a)      Wire transfer of Subscription Funds. Investor shall
                           deliver Put Dollar Amounts (as payment towards any
                           Put Share Price) by wire transfer, to the Company
                           pursuant to a wire instruction letter to be provided
                           by the Company, and signed by the Company.

                  (b)      Irrevocable Subscription. Investor hereby
                           acknowledges and agrees, subject to the provisions of
                           any applicable laws providing for the refund of
                           subscription amounts submitted by Investor, that this
                           Agreement is irrevocable and that Investor is not
                           entitled to cancel, terminate or revoke this
                           Agreement or any other agreements executed by such
                           Investor and delivered pursuant hereto, and that this
                           Agreement and such other agreements shall survive the
                           death or disability of such Investor and shall be
                           binding upon and inure to the benefit of the parties
                           and their heirs, executors, administrators,
                           successors, legal representatives and assigns. If the
                           Securities subscribed for are to be owned by more
                           than one person, the obligations of all such owners
                           under this Agreement shall be joint and several, and
                           the agreements, representations, warranties and
                           acknowledgments herein contained shall be deemed to
                           be made by and be binding upon each such person and
                           his heirs, executors, administrators, successors,
                           legal representatives and assigns.

                  8.2 Acceptance of Subscription. Ownership of the number of
securities purchased hereby will pass to Investor upon the Warrant Closing or
any Put Closing.

         9.       Indemnification.

         In consideration of the Investor's execution and delivery of the
Investment Agreement, the Registration Rights Agreement and the Warrants (the
"Transaction Documents") and acquiring the Securities thereunder and in addition
to all of the Company's other obligations under the Transaction Documents, the
Company shall defend, protect, indemnify and hold harmless Investor and all of
its stockholders, officers, directors, employees and direct or indirect
investors and any of the foregoing person's agents, members, partners or other
representatives (including, without limitation, those retained in connection
with the transactions contemplated by this Agreement) (collectively, the
"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 Indemnitee is a party to
the action for which indemnification hereunder is sought), and including
reasonable attorney's fees and disbursements (the "Indemnified Liabilities"),
incurred by any Indemnitee as a result of, or arising out of, or relating to (a)
any misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or
documents contemplated hereby or thereby, (b) any breach of any covenant,
agreement or obligation of the Company contained in the Transaction Documents or
any other certificate, instrument or document contemplated hereby or thereby,
(c) any cause of action, suit or claim, derivative or otherwise, by any
stockholder of the Company based on a breach or alleged breach by the Company or
any of its officers or directors of their fiduciary or other obligations to the
stockholders of the Company, or (d) claims made by third parties against any of
the Indemnitees based on a violation of Section 5 of the Securities Act caused
by the integration of the private sale of common stock to the Investor and the
public offering pursuant to the Registration Statement.

         To the extent permitted by law, the Investor (in such case, the
"Indemnitor") will indemnify and hold harmless the Company and the officers and
directors of the Company (collectively, in such case, the "Indemnitees" or the

                                       32
<PAGE>

"Indemnified Parties"), against any losses, claims, damages, or liabilities
(joint or several) to which they may become subject under the Act, the 1934 Act
or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon any
of the following statements or omissions: any untrue statement or alleged untrue
statement of a material fact that is provided, in writing to the Company and is
contained in such registration statement, including any preliminary prospectus
or final prospectus contained therein or any amendments or supplements thereto,
and the Investor will reimburse the Company, officer or director for any legal
or other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability, or action; provided,
however, that the indemnity agreement contained in this subsection 9(a) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability, or action if such settlement is effected without the consent of the
Investor (which consent shall not be unreasonably withheld).

         To the extent that the foregoing undertaking by the Company (or the
Investor, as applicable) may be unenforceable for any reason, the Company (or
the Investor, as applicable) shall make the maximum contribution to the payment
and satisfaction of each of the Indemnified Liabilities which it would be
required to make if such foregoing undertaking was enforceable which is
permissible under applicable law.

         Promptly after receipt by an Indemnified Party of notice of the
commencement of any action pursuant to which indemnification may be sought, such
Indemnified Party will, if a claim in respect thereof is to be made against the
other party (hereinafter "Indemnitor") under this Section 9, deliver to the
Indemnitor a written notice of the commencement thereof and the Indemnitor shall
have the right to participate in and to assume the defense thereof with counsel
reasonably selected by the Indemnitor, provided, however, that an Indemnified
Party shall have the right to retain its own counsel, with the reasonably
incurred fees and expenses of such counsel to be paid by the Indemnitor, if
representation of such Indemnified Party by the counsel retained by the
Indemnitor would be inappropriate due to actual or potential conflicts of
interest between such Indemnified Party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
Indemnitor within a reasonable time of the commencement of any such action, if
prejudicial to the Indemnitor's ability to defend such action, shall relieve the
Indemnitor of any liability to the Indemnified Party under this Section 9, but
the omission to so deliver written notice to the Indemnitor will not relieve it
of any liability that it may have to any Indemnified Party other than under this
Section 9 to the extent it is prejudicial.

                           [INTENTIONALLY LEFT BLANK]

                                       33
<PAGE>

         10. Accredited Investor. Investor is an "accredited investor" because
(check all applicable boxes):

         (a)      [  ]     it is an organization described in Section
                           501(c)(3) of the Internal Revenue Code, or a
                           corporation, limited duration company, limited
                           liability company, business trust, or partnership not
                           formed for the specific purpose of acquiring the
                           securities offered, with total assets in excess of
                           $5,000,000.

         (b)      [  ]     any trust, with total assets in excess of
                           $5,000,000, not formed for the specific purpose of
                           acquiring the securities offered, whose purchase is
                           directed by a sophisticated person who has such
                           knowledge and experience in financial and business
                           matters that he is capable of evaluating the merits
                           and risks of the prospective investment.

         (c)      [  ]     a natural person, who

                  [  ]     is a director, executive officer or general partner
                           of the issuer of the securities being offered or sold
                           or a director, executive officer or general partner
                           of a general partner of that issuer.

                  [  ]     has an individual net worth, or joint net worth with
                           that person's spouse, at the time of his purchase
                           exceeding $1,000,000.

                  [  ]     had an individual income in excess of $200,000 in
                           each of the two most recent years or joint income
                           with that person's spouse in excess of $300,000 in
                           each of those years and has a reasonable expectation
                           of reaching the same income level in the current
                           year.

         (d)      [  ]     an entity each equity owner of which is an entity
                           described in a - b above or is an individual who
                           could check one (1) of the last three (3) boxes under
                           subparagraph (c) above.

         (e)      [  ]     other [specify] ____________________________________.

                                       34

<PAGE>

         The undersigned hereby subscribes the Maximum Offering Amount and
acknowledges that this Agreement and the subscription represented hereby shall
not be effective unless accepted by the Company as indicated below.

         IN WITNESS WHEREOF, the undersigned Investor does represent and certify
under penalty of perjury that the foregoing statements are true and correct and
that Investor by the following signature(s) executed this Agreement.

Dated this 3rd day of May, 2000.
<TABLE>
<CAPTION>
<S>                                                           <C>
/s/ Eric S. Swartz                                            SWARTZ PRIVATE EQUITY, LLC
------------------------------------                          -------------------------------------------------
          Your Signature                                      PRINT EXACT NAME IN WHICH YOU WANT
                                                              THE SECURITIES TO BE REGISTERED

ERIC S. SWARTZ                                                SECURITY DELIVERY INSTRUCTIONS:
------------------------------------                          -------------------------------
Name: Please Print                                            Please type or print address where your security is to be
                                                              delivered

Manager                                                       ATTN: ERIC S. SWARTZ
------------------------------------
Title/Representative Capacity
(if applicable)

SWARTZ PRIVATE EQUITY, LLC                                    1080 Holcomb Bridge Rd. Blding 200; Suite 285
------------------------------------                          --------------------------------------------------
Name of Company You Represent                                 Street Address
(if applicable)

Ft. Lauderdale                                                Roswell, GA 30076
------------------------------------                          --------------------------------------------------
Place of Execution of this Agreement                          City, State or Province, Country, Offshore Postal Code

NOTICE DELIVERY INSTRUCTIONS:                                 WITH A COPY DELIVERED TO:
-----------------------------                                 -------------------------
Please print address where any Notice                         Please print address where Copy is
is to be delivered                                            to be delivered

ATTN: SAME AS ABOVE                                           ATTN: SAME AS ABOVE

-------------------------------------------------             ------------------------------------------
Street Address                                                Street Address

-------------------------------------------------
-------------------------------------------------
City, State or Province, Country, Offshore Postal Code        City, State or Country, Offshore Postal Code
Telephone: ______________________________________             Telephone: _________________________________
Facsimile: ______________________________________             Facsimile: __________________________________
Facsimile: ______________________________________             Facsimile: __________________________________

THIS AGREEMENT IS ACCEPTED BY THE COMPANY IN THE AMOUNT OF THE MAXIMUM OFFERING
AMOUNT ON THE 3rd DAY OF MAY, 2000.

                                                     TECHNICAL CHEMICALS AND PRODUCTS, INC.

                                                     By:/s/ Jack Aronowitz
                                                        ----------------------------
                                                        Jack Aronowitz, Chairman

                                            Address:
                                                     Attn: Walter V. Usinowicz, Jr.
                                                     3341 SW 15th Street
                                                     Pompano Beach, FL  33069
                                                     Telephone (954) 979-0400, ext. 237
                                                     Facsimile  (954) 979-6125

</TABLE>

                                       35

<PAGE>
                               ADVANCE PUT NOTICE

TECHNICAL CHEMICALS AND PRODUCTS, INC. (the "Company") hereby intends, subject
to the Individual Put Limit (as defined in the Investment Agreement), to elect
to exercise a Put to sell the number of shares of Common Stock of the Company
specified below, to _____________________________, the Investor, as of the
Intended Put Date written below, all pursuant to that certain Investment
Agreement (the "Investment Agreement") by and between the Company and Swartz
Private Equity, LLC dated on or about May 3, 2000.

                 Date of Advance Put Notice: ___________________

                 Intended Put Date :___________________________

                 Intended Put Share Amount: __________________

                 Company Designation Maximum Put Dollar Amount (Optional):
                 ________________________________________.

                 Company Designation Minimum Put Share Price (Optional):
                 ________________________________________.

                                    TECHNICAL CHEMICALS AND PRODUCTS, INC.

                                             By:_______________________________
                                                Jack Aronowitz, Chairman

                                    Address:
                                             Attn: Walter V. Usinowicz, Jr.
                                             3341 SW 15th Street
                                             Pompano Beach, FL  33069
                                             Telephone (954) 979-0400, ext. 237
                                             Facsimile  (954) 979-6125

                                    EXHIBIT E

                                       36

<PAGE>

                       CONFIRMATION of ADVANCE PUT NOTICE

_________________________________, the Investor, hereby confirms receipt of
TECHNICAL CHEMICALS AND PRODUCTS, INC.'s (the "Company") Advance Put Notice on
the Advance Put Date written below, and its intention to elect to exercise a Put
to sell shares of common stock ("Intended Put Share Amount") of the Company to
the Investor, as of the intended Put Date written below, all pursuant to that
certain Investment Agreement (the "Investment Agreement") by and between the
Company and Swartz Private Equity, LLC dated on or about May 3, 2000.

                   Date of Confirmation: ____________________

                   Date of Advance Put Notice: _______________

                   Intended Put Date: ________________________

                   Intended Put Share Amount: ________________

                   Company Designation Maximum Put Dollar Amount (Optional):
                   ________________________________________.

                   Company Designation Minimum Put Share Price (Optional):
                   ________________________________________.

                                            INVESTOR(S)

                                            ___________________________________
                                            Investor's Name

                                            By: _______________________________
                                                     (Signature)
                           Address:         ___________________________________

                                            ___________________________________

                                            ___________________________________

                           Telephone No.:   ___________________________________

                           Facsimile No.:   ___________________________________

                                    EXHIBIT F

                                       37
<PAGE>

                                   PUT NOTICE

TECHNICAL CHEMICALS AND PRODUCTS, INC. (the "Company") hereby elects to exercise
a Put to sell shares of common stock ("Common Stock") of the Company to
_____________________________, the Investor, as of the Put Date, at the Put
Share Price and for the number of Put Shares written below, all pursuant to that
certain Investment Agreement (the "Investment Agreement") by and between the
Company and Swartz Private Equity, LLC dated on or about May 3, 2000.

                                    Put Date :_________________

                                    Intended Put Share Amount (from Advance Put
                                    Notice):_________________  Common Shares

                                    Company Designation Maximum Put Dollar
                                    Amount (Optional):
                                    ________________________________________.

                                    Company Designation Minimum Put Share
                                    Price (Optional):
                                    ________________________________________.

Note:  Capitalized terms shall have the meanings ascribed to them in this
Investment Agreement.

                                     TECHNICAL CHEMICALS AND PRODUCTS, INC.

                                     By:__________________________________
                                           Jack Aronowitz, Chairman

                            Address:
                                     Attn: Walter V. Usinowicz, Jr.
                                     3341 SW 15th Street
                                     Pompano Beach, FL  33069
                                     Telephone (954) 979-0400, ext. 237
                                     Facsimile  (954) 979-6125

                                    EXHIBIT G

                                       38
<PAGE>

                           CONFIRMATION of PUT NOTICE

_________________________________, the Investor, hereby confirms receipt of
Technical Chemicals and Products, Inc. (the "Company") Put Notice and election
to exercise a Put to sell ___________________________ shares of common stock
("Common Stock") of the Company to Investor, as of the Put Date, all pursuant to
that certain Investment Agreement (the "Investment Agreement") by and between
the Company and Swartz Private Equity, LLC dated on or about May 3, 2000.

                                   Date of this Confirmation: ________________

                                   Put Date :_________________

                                   Number of Put Shares of
                                   Common Stock to be Issued: _____________

                                   Volume Evaluation Period: _____ Business Days

                                   Pricing Period: _____ Business Days

                                   INVESTOR(S)

                                   _____________________________________
                                   Investor's Name

                                   By: _________________________________
                                            (Signature)
                  Address:         _____________________________________

                                   _____________________________________

                                   _____________________________________

                  Telephone No.:   _____________________________________

                  Facsimile No.:   _____________________________________

                                    EXHIBIT H

                                       39
<PAGE>

                             PUT CANCELLATION NOTICE

TECHNICAL CHEMICALS AND PRODUCTS, INC. (the "Company") hereby cancels the Put
specified below, pursuant to that certain Investment Agreement (the "Investment
Agreement") by and between the Company and Swartz Private Equity, LLC dated on
or about May 3, 2000, as of the close of trading on the date specified below
(the "Cancellation Date," which date must be on or after the date that this
notice is delivered to the Investor), provided that such cancellation shall not
apply to the number of shares of Common Stock equal to the Truncated Put Share
Amount (as defined in the Investment Agreement).

                                  Cancellation Date: ________________________

                                  Put Date of Put Being Canceled: ___________

                                  Number of Shares Put on Put Date: _________

                                  Reason for Cancellation (check one):

                                           [  ]   Material Facts, Ineffective
                                                  Registration Period.

                                           [  ]   Delisting Event

The Company understands that, by canceling this Put, it must give twenty (20)
Business Days advance written notice to the Investor before effecting the next
Put.

                                    TECHNICAL CHEMICALS AND PRODUCTS, INC.

                                             By:_____________________________
                                                   Jack Aronowitz, Chairman

                                    Address:
                                             Attn: Walter V. Usinowicz, Jr.
                                             3341 SW 15th Street
                                             Pompano Beach, FL  33069
                                             Telephone (954) 979-0400, ext. 237
                                             Facsimile  (954) 979-6125

                                    EXHIBIT Q

                                       40
<PAGE>

                     PUT CANCELLATION NOTICE CONFIRMATION

The undersigned Investor to that certain Investment Agreement (the "Investment
Agreement") by and between the Technical Chemicals and Products, Inc.'s, and
Swartz Private Equity, LLC dated on or about May 3, 2000, hereby confirms
receipt of Technical Chemicals and Products, Inc.'s (the "Company") Put
Cancellation Notice, and confirms the following:

                                         Date of this Confirmation: ____________

                                         Put Cancellation Date : _______________

                                         INVESTOR(S)

                                         ___________________________________
                                         Investor's Name

                                         By: _______________________________
                                                  (Signature)
                        Address:         ___________________________________

                                         ___________________________________

                                         ___________________________________

                        Telephone No.:   ___________________________________

                        Facsimile No.:   ___________________________________

                                    EXHIBIT S

                                       41

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