Document:

EXHIBIT 10.12

                              EMPLOYMENT AGREEMENT

         THIS  AGREEMENT made as of the 28th day of January 2004, by and between
MediaBay Inc., a Florida corporation,  with offices at 2 Ridgedale Avenue, Cedar
Knolls, New Jersey 07927 (the "Company"),  and Jeffrey A. Dittus residing at 600
Old Gulph Road, Penn Valley, Pennsylvania 19072 (the "Executive').

                              W I T N E S S E T H:

         WHEREAS,  the Company is engaged in the audio book club, old time radio
and spoken audio digital download businesses; and

         WHEREAS, the Company desires to employ the Executive; and

         WHEREAS, the Executive is willing to serve the Company on the terms and
conditions herein provided.

         NOW,  THEREFORE,  in  consideration  of the promises and the respective
covenants  and  agreements of the parties  herein  contained and intending to be
legally bound hereby, the parties agree as follows:

         1. Recitals.  The Whereas clauses recited above are hereby incorporated
by reference as though they were fully set forth herein.

         2. Employment. The Company shall employ the Executive and the Executive
shall serve the Company on the terms and conditions set forth herein.

         3. Term. The term of this Agreement  shall commence on January 30, 2004
("Effective  Date")  and  shall end April  30,  2006 if not  terminated  earlier
pursuant to the termination  provisions contained herein (the "Term"). If either
the Company or the Executive  wish to extend or renew the term of this Agreement
when it expires,  then any such extension or renewal will be mutually  agreed to
in writing by the parties.

         4.  Position  and Duties.  Subject to the terms set forth  herein,  the
Executive  shall be  employed  by the  Company  as Chief  Executive  Officer  of
MediaBay,  Inc.  His power and  authority  shall be and  remain  subject  to the
direction and control of the Board of Directors and the Chairman of the Company.
The Executive shall have profit and loss  responsibility for the Company and its
subsidiaries   (including  Audio  Book  Club,  Inc.,  Radio  Spirits,  Inc.  and
MediaBay.com,  Inc.)  as well as  operational  and  marketing  oversight  of the
business  and  affairs  of the  Company  and its  subsidiaries,  and  any  other
businesses which the Company or its subsidiaries may acquire.

         5. During the Term, the Executive  shall be required to devote his best
efforts and spend his full time and  attention,  without other outside  business
interests or activities,  in the performance of his duties and the Company's and
its  subsidiaries'  business  and  affairs.  The  exceptions  to  this  are  the
Executive's ongoing work as Founding Chairman of the Divine 9 Open, a charitable

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fund raiser for the Leukemia and Lymphoma Society and existing mandates that the
Executive  has  made  the  Chairman  aware  of that  Kauri  Capital  LLC has not
completed  prior to the Effective  Date, and outside  investments  that will not
materially impact his duties as Chief Executive Officer.

         6. Compensation and Related Matters.

                  (a)  Base  Salary.  For  services  rendered  pursuant  to this
Agreement,  the  Company  shall pay to the  Executive  an annual  base salary of
$225,000 in equal semi-monthly  installments in arrears on the 15th and last day
of each month subject to applicable withholding and other taxes. The base salary
shall be increased to $250,000 per year upon consummation of a debt,  equity, or
combination  of debt and equity  financing of  $10,000,000 or more prior to June
30, 2004 (as measured  against the  Company's  balance  sheet as of December 31,
2003).

                  (b)  Bonus.  The  Executive  will be  eligible  to  receive  a
discretionary annual bonus to be determined by the Compensation Committee of the
Board of Directors of the Company in its discretion.  Eligibility for such bonus
will be based upon a set of financial and  non-financial  objectives  set by the
Compensation  Committee  of the Board of  Directors  for each fiscal year (which
ends on December 31).  Executive must remain an employee  through the end of the
applicable  fiscal  year  or he will  not be  eligible  to  receive  any  bonus.
Determinations  as to whether the Executive  shall receive any bonus,  including
the  determination as to whether  objectives have been met, shall be made at the
sole discretion of the Board. Any bonus awarded will be paid no later than April
15 of the following year.

                  (c) Expenses. The Executive shall receive prompt reimbursement
for all  reasonable  travel and business  expenses in  connection  with services
performed hereunder in accordance with normal Company policy, as the same may be
determined from time to time.

                  (d) Insurance and Employee  Benefits.  The Executive  shall be
eligible  to  receive  such  medical  insurance  and 401k  benefits  as are made
available to all officers of the Company, subject to the general eligibility and
participation provisions set forth in such plans. The Company reserves the tight
to adopt,  amend,  or  discontinue  any employee  benefit,  plan,  or program in
accordance with then applicable law.

                  (e)  Vacation.  The Executive  shall receive  during each full
year of his  employment,  three (3) weeks (fifteen  working days) paid vacation.
Unused  vacation days shall not be carried  forward into the following  year and
the Executive shall not receive any compensation for unused vacation.

                  (f) Stock Options. The Executive will be granted stock options
to acquire one million five hundred thousand  (1,500,000) shares of Common Stock
in the Company pursuant to and in accordance with (and therefore  subject to all
terms and  conditions  of) the Company's  Stock Option Plan.  The Executive will
receive these option grants pursuant to six separate option agreements.  All six
stock option awards will be granted on the Effective Date. The First Option with
respect to Two Hundred and Fifty Thousand  (250,000)  shares shall vest on the 3
month  anniversary  of the  Effective  Date at a price per  share of $0.99.  The
Second Option with respect to Two Hundred and Fifty  Thousand  (250,000)  shares
shall vest on the 6 month anniversary of the Effective Date at a price per share

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of $0.99.  The Third  Option  with  respect to Two  Hundred  and Fifty  Thousand
(250,000) shares shall vest on the 12 month anniversary of the Effective Date at
a price per share of $1.55.  The Fourth  Option with  respect to Two Hundred and
Fifty Thousand  (250,000)  shares shall vest on the 18 month  anniversary of the
Effective  Date at a price per share of $1.55.  The Fifth Option with respect to
Two Hundred Thousand  (250,000) shares shall vest on the 24 month anniversary of
the Effective Date at a price per share of $1.86.  The Sixth Option with respect
to Two Hundred Fifty Thousand (250,000) shares shall vest on April 30, 2006 at a
price per share of $1.86.

                  (g) The Stock  Options will vest in each instance as described
above provided that the Executive is an employee of the Company at the time such
vesting is to occur and they will expire five (5) years from the  anniversary of
the  Effective  Date.  Such options will be on the terms and  conditions as more
specifically  provided for in the Company's Stock Option Plan and a Stock Option
Agreement  dated as of the date hereof  between the Company and the Executive in
the form of Exhibit A hereto.

                  In the event the Executive is terminated  Without  Cause,  the
         Stock  Options  shall vest on the same schedule as if the Executive was
         still an  Employee  until  the date of  Termination.  In the event of a
         Change of Control,  as defined herein, all of the Stock Options granted
         to the Executive shall immediately vest.

                  (h)  Registration  Statement.  The Company  will file with the
Securities and Exchange  Commission a  registration  statement on Form S-8 on or
before  February 9, 2005  covering the shares of Common Stock  issuable upon the
exercise of the stock options granted to the Executive pursuant to Section 5 (f)
and (g) above.

         7. Non-Competition and Confidentiality Covenant.

                  (a) During the Term of this  Agreement and for a period of two
(2) years immediately following the termination of his employment,  whether said
termination is occasioned by the Company, the Executive or a mutual agreement of
the  parties,  the  Executive  shall not,  for himself or on behalf of any other
person,  persons,  firm,  partnership,  corporation  or  company,  (i) engage or
participate in any activities  which are  competitive  with the Company,  at the
time of  Termination,  and its  subsidiaries  including the audiobook,  old-time
radio and spoken audio digital download  businesses and any businesses which are
acquired by, merged with or  transferred to the Company (the  "Business"),  (ii)
solicit or attempt to solicit the  business or  patronage  of any person,  firm,
corporation,  company or  partnership,  which had  previously  been a  customer,
consultant  or employee of the Company or its  subsidiaries,  for the purpose of
engaging in the Business or (iii) solicit,  engage or hire any individual who is
then  employed or was employed by the Company or its  subsidiaries  or is then a
consultant or was a consultant for the Company or its subsidiaries.

                  (b) The Executive  acknowledges  and agrees that:  all mailing
lists;  customer,  member  and  prospect  names;  license  or  arrangement  with
publishers; front-end and back-end marketing performance;  financial statements;
operating system, database and other computer software,  specific to the Company
or its  subsidiaries;  and all information which is known by the Executive to be
subject to a confidentiality  agreement or obligation of  confidentiality,  even
without a  confidentiality  agreement between the Company or a subsidiary of the
Company and another  person or party,  shall be maintained by the Executive in a
confidential  manner and the Executive  agrees that the  Executive  will not use
such  information  to the  detriment  of the  Company  and its  subsidiaries  or

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disclose such information to any third party,  except as may be necessary in the
course of performing  the  Executive's  job  responsibilities  or as required by
applicable  law.  The  Executive   further  agrees  that  these  obligations  of
confidentiality  with  respect  to such  information  shall  continue  after the
Executive ceases to be employed by the Company. Disclosure of the aforementioned
information shall not be prohibited if such disclosure is directly pursuant to a
valid  and  existing  order  of a court  or other  governmental  body or  agency
provided,  however,  that (i) the Executive shall first have given prompt notice
to the Company of any such possible or prospective order (or proceeding pursuant
to which any such other may result), (ii) the Company shall have been afforded a
reasonable  opportunity  to review such  disclosure  and to prevent or limit any
such disclosure,  and (iii) the Executive shall, if requested by the Company and
at the Company's cost and expense, use his reasonable best efforts to prevent or
limit  any such  disclosure  by means of a  protective  order or a  request  for
confidential  treatment  Confidential  information shall not include information
generally  available to the public.  The provisions of Section 7 are intended by
the  parties  to  survive  and do  survive  termination  or  expiration  of this
Agreement

         8. Executive's Representation and Warranties.

                  (a) No Breach of Contract.  Executive  represents and warrants
that the  execution  and  delivery of this  Agreement by the  Executive  and the
performance of the Executive's  obligations  hereunder will not conflict with or
breach any  agreement,  order or decree to which the  Executive is a party or by
which the Executive is bound.

                  (b) No Conflict of Interest. Executive warrants that Executive
is not,  to the  best of  Executive's  knowledge  and  belief,  involved  in any
situation  that might create,  or appear to create,  a conflict of interest with
Executive's loyalty to or duties for the Company.

                  (c)   Notification   of  Materials  or  Documents  from  Other
Employers.  Executive  further  warrants that Executive has not brought and will
not  bring  to  the   Company  or  use  in  the   performance   of   Executive's
responsibilities  at the Company any materials or documents of a former employer
that are not generally  available to the public,  unless  Executive has obtained
express written  authorization from the former employer for their possession and
use.

                  (d)   Notification  of  Other   Post-Employment   Obligations.
Executive  also  understands  that, as part of Executive's  employment  with the
Company,  Executive  is not to breach any  obligation  of  confidentiality  that
Executive  has to  former  employers,  and  Executive  agrees  to honor all such
obligations to former employers during Executive's  employment with the Company.
Executive  warrants  that  Executive  is subject to no  employment  agreement or
restrictive  covenant  preventing full  performance of Executive's  duties under
this Agreement

                  (e) Indemnification for Breach; Survival. In addition to other
remedies  which the Company might have for breach of this  Agreement,  Executive
agrees  to  indemnify  and hold the  Company  harmless  from any  breath  of the
provisions  of this  Section 6. The terms of this  Section 6 shall  survive  any
termination of this Agreement.

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         9. Termination by the Company.

                  (a)  General.  The Company  shall have the right to  terminate
this  Agreement  with or  without  Cause  at any  time  during  the term of this
Agreement by giving written notice to the Employee. The termination shall become
effective on the date specified in the notice,  which termination date shall not
be a date prior to the date fourteen (14) days  following the date of the notice
of termination itself, provided,  however, that the termination of Executive may
become  effective  on the date of the notice or on any date during the  fourteen
(14) day period following the notice provided that the Company  continues to pay
the Employee's Base Salary during the fourteen-day  period following the date of
the notice.  Upon  termination,  the Company shall immediately pay the Executive
any  reimbursable  expenses owed to him and make  available to the Executive the
Cobra portion of his health care benefits.

                  (b) Cause.  In the event that the Executive is terminated  for
Cause (as defined  below),  the Company  shall pay the Executive any unpaid base
salary due Executive  through the date of termination and notice pay, if any, as
provided  in  subparagraph  (a) above.  Executive  shall not be  entitled to any
additional salary, bonus payments, severance, or other compensation.

                  (c)  Without  Cause.  In  the  event  that  the  Executive  is
terminated  Without Cause,  pursuant to this Section 9(c), in addition to paying
the Executive through the date of termination and, if applicable, complying with
subparagraph  (a) above,  provided  Executive  and the Company  executes a full,
general mutual  release of claims  against each other,  the Company shall pay to
the Executive  severance  compensation  equal to a certain  number of months (as
defined  below) of the  Employee's  Base  Salary as of the date of  termination,
payable on the Company's regular payroll dates in accordance with normal payroll
practices  and subject to deductions as required by law. The number of months of
severance shall be determined as follows:  if the termination  occurs within the
first  twenty-six  (26) months of this  Agreement,  then the number of months of
severance shall be the number of months worked by Executive hereunder subtracted
from twenty-six (26).

                  (d) Cause  Defined.  For  purposes of this  Section 9, "Cause"
shall mean that the Board of Directors  has  determined  in its sole  discretion
that the Executive has engaged in any of the following:  (i) any act or omission
which  constitutes  a  material  breach  of, or  material  failure or refusal to
perform duties under this Agreement and any covenant or condition thereof, after
notice of such and failure to cure the same within  fifteen (15) business  days;
(ii) any act constituting  dishonesty,  fraud,  immoral or disreputable  conduct
which  is  materially  harmful  to the  Company  or its  reputation;  (iii)  any
conviction  of a  felony  under  applicable  law;  (iv)  refusal  to abide by or
implement a lawful  directive of the Board of Directors after notice of such and
failure to cure the same within fifteen  business days; or (vi) gross negligence
or gross misconduct of the Executive.

         10. Termination by the Employee.

                  (a) General. The Executive may terminate this Agreement at any
time, with or without Good Reason (as defined below),  by giving at least thirty
days' written notice to the Company. Any such termination shall become effective
on the date specified in such notice,  provided that if the Executive gives more
than  thirty  (30)  days  written  notice  the  Company  may  elect to have such
termination  become  effective on any date on or after the thirtieth  (30th) day
after the date of the  notice  and prior to the date  specified  in the  notice.
Notwithstanding the foregoing,  at the option of the Company, the termination of
Executive's  employment may become effective on any date on or after the date of

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the notice  upon notice to the  Executive  by the Company and the payment by the
Company of the Executive's  base salary during the thirty-day  period  following
the date of Executive's  notice of termination of employment.  Upon termination,
the Company shall  immediately pay the Executive any reimbursable  expenses owed
to him and make  available to the Executive the Cobra portion of his health care
benefits.

                  (b)  Without  Good  Reason.  In the event  that the  Executive
terminates his employment  without Good Reason (as defined  below),  the Company
shall pay the Executive any unpaid base salary due Executive through the date of
termination  and notice pay, if any,  as  provided  in  subparagraph  (a) above.
Executive  shall not be  entitled  to any  additional  salary,  bonus  payments,
severance, or other compensation.

                  (c) Good  Reason.  In  addition  to any unpaid base salary due
Executive through the date of termination and notice pay, if any, as provided in
subparagraph  (a) above,  if such  termination is for Good Reason,  provided the
Executive  and the Company  executes a full,  general  mutual  release of claims
against  each  other,   the  Company  shall  pay  to  the  Executive   severance
compensation  equal to a  certain  number of months  (as  defined  below) of the
Employee's base salary as of the date of  termination,  payable on the Company's
regular payroll dates in accordance with normal payroll practices and subject to
deductions  as  required  by law.  The  number of months of  severance  shall be
determined as follows:  if the  termination  occurs within the first  twenty-six
(26) months of this  Agreement,  then the number of months of severance shall be
the number of months worked by Executive  hereunder  subtracted  from twenty-six
(26).

                  (d) Good Reason Defined. For purposes of this Agreement, "Good
Reason" shall mean:

                           (i) any reduction in the  Employee's  Base Salary not
agreed to by the Employee; or

                           (ii) a material adverse change made by the Company in
the Executive's core functions, duties or responsibilities that would constitute
a demotion and that is not agreed to by the Employee; or

                           (iii) a requirement that the Executive relocate to an
office more than 75 miles from the office of the Company at which the  Executive
spends the majority of his time on the date of  relocation  without  Executive's
consent.

provided  however,  that any  actions  taken by the  Company  to  accommodate  a
disability  of the  Executive  or pursuant  to the Family and Medical  Leave Act
shall not be a Good Reason for purposes of this Agreement and provided  further,
in each such event listed in (i) through (iii) above,  the Executive  shall give
the  Company  notice  thereof  which  shall  specify  in  reasonable  detail the
circumstances  constituting Good Reason,  and there shall be no Good Reason with
respect to any such  circumstances  if cured by the Company  within  thirty (30)
days after such notice.

         11.  Change of Control.  For  purposes  of this  Agreement a "Change of
Control" shall be deemed to occur, unless previously  consented to in writing by
the  Executive,  and only if the Executive is not offered  continued  employment
under  terms  substantially  similar  to this  Agreement,  upon  (i) the  actual

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acquisition  of fifty  percent  (50%) or more of the  voting  securities  of the
Company by any company or entity or  affiliated  group of  companies or entities
(other than pursuant to a bona fide underwriting  agreement relating to a public
distribution  of securities of the Company) not affiliated with the Executive or
Norton  Herrick  and/or  any of their  affiliates  or family  members,  (ii) the
completion  of a tender or exchange  offer for more than fifty  percent (50%) of
the voting  securities  of the  Company by any  company or entity or  affiliated
group of  companies  or entities  not  affiliated  with the  Executive or Norton
Herrick and/or any of their  affiliates or family members,  (iii) the completion
of a proxy contest  against the management for the election of a majority of the
Board of  Directors  of the  Company  if the  group  (other  than a group  which
includes  Norton  Herrick  and/or  any  of his  affiliates  or  family  members)
conducting the proxy contest owns, has or gains the power to vote at least fifty
percent  (50%)  of the  voting  securities  of the  Company,  (iv) a  merger  or
consolidation  in which the Company is not the surviving entity or (v) a sale of
all or substantially all of the assets of the Company.

         12. Termination by Death or Disability of the Executive.

                  (a) Death.  In the event of the  Executive's  death during the
term of this Agreement, all obligations of the parties hereunder shall terminate
immediately,  and the Company shall pay to the Executive's legal representatives
the Base Salary (and any earned  bonuses) due the  Executive  through the day on
which Executive's death shall have occurred.

                  (b) Disability.  Subject to applicable  state and federal law,
the  Company  shall at all times  have the  right,  upon  written  notice to the
Executive,  to terminate this Agreement based on the Executive's  Disability (as
defined below). Upon any termination pursuant to this Section, the Company shall
pay to the  Executive  any unpaid Base  Salary  through  the  effective  date of
termination  specified  in such  notice.  The  Company  shall  have  no  further
liability  hereunder  (other  than for  reimbursement  for  reasonable  business
expenses  incurred  prior to the date of  termination,  subject,  however to the
provisions  hereof).  Termination by the Company of the  Executive's  employment
based on "Disability" shall mean termination  because the Executive is unable to
perform  the  essential  functions  of  Executive's  position  with  or  without
accommodation due to a disability (as such term is defined in the Americans with
Disabilities  Act)  for  six  consecutive   months.  This  definition  shall  be
interpreted and applied consistent with the Americans with Disabilities Act, the
Family and Medical Leave Act and other applicable law.

         13.  Termination by Mutual  Consent.  If at any time during the term of
this Agreement the parties by mutual consent decide to terminate this Agreement,
they shall do so by separate agreement setting forth the terms and conditions of
such termination.

         14.  Indemnification.   To  the  maximum  extent  permitted  under  the
corporate laws of the State of Florida,  (a) the Executive  shall be indemnified
and held harmless by the Company,  as provided under such corporate laws for any
and all actions  taken or matters  undertaken,  directly or  indirectly,  in the
performance of his duties and responsibilities under this Agreement or otherwise
on behalf  of the  Company,  provided  the  Executive  did not act  wantonly  or
recklessly or was not grossly  negligent or engaged in willful  misconduct,  and
(b) without  limiting  clause (a), the Company shall indemnify and hold harmless
the  Executive  from and against  (i) any claim,  loss,  liability,  obligation,
damage,   cost,   expense,   action,   suit,   proceeding  or  cause  of  action
(collectively,  "Claims")  arising from or out of or relating to the Executive's
acting as an officer,  director,  employee or agent of the Company or any of its

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affiliates  or  in  any  other  capacity,  including,  without  limitation,  any
fiduciary capacity, in which the Executive serves at the request of the Company,
and  (ii)  any  cost  or  expense  (including.   without  limitation,  fees  and
disbursements of counsel)  (collectively,  "Expenses") incurred by the Executive
in  connection  with the  defense  or  investigation  thereof.  If any  Claim is
asserted or other matter arises with respect to which the Executive  believes in
good faith the Executive is entitled to indemnification as contemplated  hereby,
the Company  shall,  at its  election) to be determined in its sole and absolute
discretion,  either assume the defense or  investigation of such Claim or matter
or pay the Expenses  incurred by the Executive in connection with the defense or
investigation of such Claim or matter,  when and as incurred,  provided that the
Executive  shall  reimburse the Company for such amounts,  plus simple  interest
thereon  at the  then  current  Prime  Rate as in  effect  from  time  to  time,
compounded  annually,  if the Executive  shall be found,  as finally  judicially
determined  by a court of competent  jurisdiction,  not to have been entitled to
indemnification hereunder.

This Indemnification shall survive the Termination of this Agreement.

         15.  Governing Law.  Except as preempted by federal law, this Agreement
shall be executed,  construed and  performed in accordance  with the laws of the
State of New Jersey  without  reference  to  conflict  of laws  principles.  The
parties  agree  that the venue for any  dispute  hereunder  will be the state or
federal  courts in New  Jersey and the  parties  hereby  agree to the  exclusive
jurisdiction thereof.

         16. Binding  Agreement.  This Agreement and all rights and  obligations
hereunder  shall inure to the benefit of and be  enforceable  by the parties and
their personal or legal representatives,  executors, administrators, successors,
heirs,  distributees,  devisees  and legatees  and  assigns,  including  without
limitation any successor to the Company whether by merger,  consolidation,  sale
of stock or otherwise.

         17. Notice. For the purpose of this Agreement, notices, demands and all
other  communications  provided  for in this  Agreement  shall be in writing and
shall be deemed to have been duly given when delivered personally, or by private
overnight  courier  or  mail  service,  postage  prepaid  or  (unless  otherwise
specified)  mailed by United States registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:

If to the Executive:   To his home address as listed in Company records at the
                       time notice is given
If to the Company:     To its corporate headquarters at the time notice is
                       given, "Attention: Board of Directors"

or to such other  address as the  parties  may furnish to each other in writing.
Copies of all  notices,  demands  and  communications  shall be sent to the home
addresses of all members of the Board of Directors of the Company.

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         18. Waiver and Modification.

                  (a) No provision of this Agreement may be modified,  waived or
discharged unless such waiver, modification or discharge is agreed to in writing
signed by the parties  hereto,  provided,  however,  that this  Agreement may be
modified, waived or discharged by mutual agreement in writing.

                  (b) No delay,  waiver,  omission  or  forbearance  (whether by
conduct or  otherwise)  by any party  hereto at any time to exercise  any right,
option, duty or power arising out of breach or default by the other party of any
of the terms, conditions or provisions of this Agreement to be performed by such
other party shall  constitute a waiver by such party or a waiver of such party's
rights to enforce any right, option or power as against the other party or as to
subsequent  breach or default by such other party,  and no explicit waiver shall
constitute a waiver of similar or dissimilar terms,  provisions or conditions at
the same time or at any prior or subsequent time.

         19.  Severability.  The invalidity or unenforceability of any provision
or provisions of this Agreement shall not affect the validity or  enforceability
of any other provision of this Agreement, and, in the event that any one or more
of the words,  phrases,  sentences,  clauses,  provisions,  sections or articles
contained in this Agreement shall be declared  invalid,  this Agreement shall be
construed  as if such  invalid  word or words,  phrase or  phrases,  sentence or
sentences, clause or clauses,  provisions or provisions,  section or sections or
article or articles had not been  inserted and the  remainder of this  Agreement
shall remain in full force and effect.

         20.  Counterparts.  This  Agreement  may be  executed  in  one or  more
counterparts,  each of which shall be deemed to be an original  but all of which
together will constitute one and the same instrument.

         21. Entire Agreement.  This Agreement and the Confidential Information,
Inventions Assignment,  Non-Solicitation and Non-Competition  Agreement attached
hereto contains the entire  understanding  of the Company and the Executive with
respect to the  subject  matter  hereof.  This  Agreement  supersedes  all prior
agreements and understandings  whether written or oral between the Executive and
the Company with respect to such subject matter,  and there are no restrictions,
agreements,  promises,  warranties or covenants  other than those stated in this
Agreement.

         IN WITNESS  WHEREOF,  the parties have executed  this  Agreement on the
date shown below effective as of the date first written above.

                                        "COMPANY"

Date Signed: January 28, 2004           MEDIABAY, INC., a Florida corporation

                                        By: /s/ John Levy
                                            -----------------------------------
                                        Printed Name: John F. Levy
                                                      -------------------------
                                        Title: Vice Chairman and CFO

                                        "EXECUTIVE"

Date Signed: January 28, 2004           /s/ Jeffrey A. Dittus
                                        ---------------------------------------
                                        Jeffrey A. Dittus

                                       9EXHIBIT 4.1

                             SUBSCRIPTION AGREEMENT

      SUBSCRIPTION  AGREEMENT  (this  "Agreement")  made as of the last date set
forth on the signature  page hereof  between  Administration  for  International
Credit  &  Investment,   Inc.  (the   "Company"),   and  the  undersigned   (the
"Subscriber").

                              W I T N E S S E T H:

      WHEREAS, the Company has retained Strome Securities,  L.P. (the "Placement
Agent")  to act as  placement  agent  in a  private  offering  (the  "Offering")
consisting  of up to 1,750,000  units,  each  consisting  of one share of common
stock, par value $.001 per share ("Common Stock"),  one Series A Warrant and one
Series B Warrant  (collectively,  the  "Warrants"  and together  with the Common
Stock, the "Units"); and

      WHEREAS, the Subscriber desires to purchase that number of Units set forth
on the signature page hereof on the terms and conditions hereinafter set forth.

      NOW,   THEREFORE,   in  consideration  of  the  premises  and  the  mutual
representations  and  covenants  hereinafter  set forth,  the parties  hereto do
hereby agree as follows:

I. SUBSCRIPTION FOR UNITS AND REPRESENTATIONS BY SUBSCRIBER

      1.1 Subject to the terms and conditions  hereinafter  set forth and in the
Confidential Offering Memorandum dated February 2005 (such memorandum,  together
with  all  amendments   thereof  and  supplements  and  exhibits  thereto,   the
"Memorandum"),  the Subscriber hereby  irrevocably  subscribes for and agrees to
purchase from the Company such number of Units,  and the Company  agrees to sell
to the Subscriber as is set forth on the signature  page hereof,  at a per share
price  equal to $2.00 per Unit.  The  purchase  price is payable by  personal or
business  check or money order made  payable to "CST&T AAF AICI ESCROW  ACCOUNT"
contemporaneously  with the  execution  and  delivery of this  Agreement  by the
Subscriber.  Subscribers may also pay the subscription  amount by, wire transfer
of immediately available funds to:

                  NAME:             Continental Stock Transfer & Trust Co. AAF
                                    AICI ESCROW ACCOUNT
                  OR:               CST&T AAF AICI ESCROW ACCOUNT
                  BANK:             JP Morgan Chase Bank
                  ACCOUNT:          530-058669
                  ABA:              021000021

      1.2 The  Subscriber  recognizes  that the purchase of the Units involves a
high  degree of risk  including,  but not  limited  to, the  following:  (a) the
Company remains a development  stage business with limited operating history and
requires  substantial funds in addition to the proceeds of the Offering;  (b) an
investment  in the Company is highly  speculative,  and only  investors  who can
afford the loss of their  entire  investment  should  consider  investing in the
Company  and the Units;  (c) the  Subscriber  may not be able to  liquidate  its
investment;  (d)  transferability  of the Units,  including the Common Stock and

<PAGE>

Warrants  contained  therein  and Common  Stock  issuable  upon  exercise of the
Warrants (defined below) (sometimes hereinafter  collectively referred to as the
"Securities")  is  extremely  limited;  (e) in the event of a  disposition,  the
Subscriber could sustain the loss of its entire investment;  (f) the Company has
not paid any dividends  since its inception and does not  anticipate  paying any
dividends;  and (g) the Company may issue  additional  securities  in the future
which have rights and preferences  that are senior to those of the Common Stock.
Without limiting the generality of the  representations set forth in Section 1.5
below, the Subscriber  represents that the Subscriber has carefully reviewed the
section of the Memorandum captioned "Risk Factors."

      1.3 The  Subscriber  represents  that  the  Subscriber  is an  "accredited
investor" as such term is defined in Rule 501 of Regulation D  ("Regulation  D")
promulgated under the Securities Act of 1933, as amended (the "Securities Act"),
as indicated by the Subscriber's responses to the questions contained in Article
VII hereof,  and that the  Subscriber  is able to bear the  economic  risk of an
investment in the Units.

      1.4  The  Subscriber  hereby  acknowledges  and  represents  that  (a) the
Subscriber has knowledge and experience in business and financial matters, prior
investment  experience,  including investment in securities that are non-listed,
unregistered  and/or  not traded on a national  securities  exchange  nor on the
National  Association  of  Securities  Dealers,   Inc.  (the  "NASD")  automated
quotation  system  ("NASDAQ"),  or the Subscriber has employed the services of a
"purchaser  representative"  (as defined in Rule 501 of Regulation D),  attorney
and/or  accountant to read all of the documents  furnished or made  available by
the Company both to the Subscriber and to all other prospective investors in the
Units to evaluate the merits and risks of such an investment on the Subscriber's
behalf;  (b) the  Subscriber  recognizes the highly  speculative  nature of this
investment;  and (c) the  Subscriber  is able to bear the economic risk that the
Subscriber hereby assumes.

      1.5 The Subscriber hereby acknowledges  receipt and careful review of this
Agreement,  the  Memorandum  (which  includes the Risk  Factors),  including all
exhibits  thereto,  and any documents  which may have been made  available  upon
request  as  reflected  therein  (collectively  referred  to  as  the  "Offering
Materials") and hereby  represents that the Subscriber has been furnished by the
Company  during the course of the Offering  with all  information  regarding the
Company, the terms and conditions of the Offering and any additional information
that the  Subscriber has requested or desired to know, and has been afforded the
opportunity  to ask  questions  of and  receive  answers  from  duly  authorized
officers or other  representatives of the Company concerning the Company and the
terms and conditions of the Offering.

      1.6 (a) In making the decision to invest in the Units the  Subscriber  has
relied  solely upon the  information  provided  by the  Company in the  Offering
Materials.  To the extent  necessary,  the Subscriber  has retained,  at its own
expense,   and  relied  upon  appropriate   professional  advice  regarding  the
investment,  tax and legal merits and  consequences  of this  Agreement  and the
purchase  of the Units  hereunder.  The  Subscriber  disclaims  reliance  on any
statements made or information provided by any person or entity in the course of
Subscriber's consideration of an investment in the Units other than the Offering
Materials.

                                       2
<PAGE>

            (b) The Subscriber  represents that (i) the Subscriber was contacted
regarding  the  sale of the  Units by the  Company  (or an  authorized  agent or
representative  thereof)  with  whom  the  Subscriber  had a  prior  substantial
pre-existing  relationship and (ii) no Units were offered or sold to it by means
of any form of general  solicitation or general  advertising,  and in connection
therewith,  the  Subscriber  did not (A)  receive or review  any  advertisement,
article,  notice or other communication  published in a newspaper or magazine or
similar media or broadcast over television or radio,  whether closed circuit, or
generally  available;  or (B) attend any seminar  meeting or  industry  investor
conference  whose attendees were invited by any general  solicitation or general
advertising.

      1.7 The Subscriber hereby represents that the Subscriber, either by reason
of  the  Subscriber's  business  or  financial  experience  or the  business  or
financial  experience  of  the  Subscriber's   professional  advisors  (who  are
unaffiliated with and not compensated by the Company or any affiliate or selling
agent of the Company,  directly or indirectly),  has the capacity to protect the
Subscriber's  own  interests in  connection  with the  transaction  contemplated
hereby.

      1.8 The  Subscriber  hereby  acknowledges  that the  Offering has not been
reviewed by the United States Securities and Exchange Commission (the "SEC") nor
any state regulatory  authority since the Offering is intended to be exempt from
the  registration  requirements  of Section 5 of the  Securities Act pursuant to
Regulation  D  promulgated  thereunder.  The  Subscriber  understands  that  the
Securities have not been registered  under the Securities Act or under any state
securities  or  "blue  sky"  laws and  agrees  not to sell,  pledge,  assign  or
otherwise transfer or dispose of the Securities unless they are registered under
the Securities Act and under any applicable  state securities or "blue sky" laws
or unless an exemption from such registration is available.

      1.9 The Subscriber  understands  that the Securities  comprising the Units
have not been  registered  under  the  Securities  Act by  reason  of a  claimed
exemption under the provisions of the Securities Act that depends, in part, upon
the Subscriber's investment intention. In this connection, the Subscriber hereby
represents that the Subscriber is purchasing the Securities for the Subscriber's
own account for investment and not with a view toward the resale or distribution
to others.  The  Subscriber,  if an entity,  further  represents that it was not
formed for the purpose of purchasing the Securities.

      1.10 The  Subscriber  understands  that there is no public  market for the
Common  Stock and that no market may  develop  for any of such  Securities.  The
Subscriber   understands  that  even  if  a  public  market  develops  for  such
Securities,  Rule 144 ("Rule 144") promulgated under the Securities Act requires
for non-affiliates,  among other conditions,  a one-year holding period prior to
the resale (in limited amounts) of securities  acquired in a non-public offering
without  having to satisfy the  registration  requirements  under the Securities
Act. The  Subscriber  understands  and hereby  acknowledges  that the Company is
under no obligation to register any of the  Securities  under the Securities Act
or any state securities or "blue sky" laws other than as set forth in Article V.

                                       3
<PAGE>

      1.11  The  Subscriber  consents  to  the  placement  of a  legend  on  any
certificate or other document  evidencing  the Securities  that such  Securities
have not been  registered  under the Securities  Act or any state  securities or
"blue  sky"  laws  and  setting  forth  or  referring  to  the  restrictions  on
transferability and sale thereof contained in this Agreement.  The Subscriber is
aware that the Company  will make a notation  in its  appropriate  records  with
respect to the  restrictions  on the  transferability  of such  Securities.  The
legend to be placed on each certificate shall be in form  substantially  similar
to the following:

      "THE  SECURITIES  REPRESENTED  HEREBY HAVE NOT BEEN  REGISTERED  UNDER THE
      UNITED STATES  SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR ANY STATE
      SECURITIES OR "BLUE SKY LAWS," AND MAY NOT BE OFFERED, SOLD,  TRANSFERRED,
      ASSIGNED, PLEDGED OR HYPOTHECATED ABSENT AN EFFECTIVE REGISTRATION THEREOF
      UNDER SUCH ACT OR COMPLIANCE WITH RULE 144 PROMULGATED  UNDER SUCH ACT, OR
      UNLESS  THE  COMPANY  HAS  RECEIVED  AN  OPINION  OF  COUNSEL,  REASONABLY
      SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT
      REQUIRED."

      1.12  The  Subscriber  understands  that  the  Company  will  review  this
Agreement and is hereby given  authority by the Subscriber to call  Subscriber's
bank or place of  employment or otherwise  review the financial  standing of the
Subscriber;  and it is further agreed that the Company,  at its sole discretion,
reserves the unrestricted right,  without further  documentation or agreement on
the part of the  Subscriber,  to  reject or limit  any  subscription,  to accept
subscriptions  for fractional  Units and to close the Offering to the Subscriber
at any time and that the Company will issue stop  transfer  instructions  to its
transfer agent with respect to such Securities.

      1.13 The Subscriber  hereby  represents that the address of the Subscriber
furnished  by  Subscriber  on the  signature  page  hereof  is the  Subscriber's
principal  residence if Subscriber  is an  individual or its principal  business
address if it is a corporation or other entity.

      1.14 The  Subscriber  represents  that the  Subscriber  has full power and
authority  (corporate,  statutory  and  otherwise)  to execute and deliver  this
Agreement and to purchase the Units. This Agreement constitutes the legal, valid
and binding obligation of the Subscriber,  enforceable against the Subscriber in
accordance with its terms.

      1.15 If the Subscriber is a corporation,  partnership,  limited  liability
company,  trust,  employee benefit plan,  individual  retirement account,  Keogh
Plan, or other  tax-exempt  entity,  it is authorized and qualified to invest in
the Company and the person  signing this  Agreement on behalf of such entity has
been duly authorized by such entity to do so.

      1.16  The  Subscriber  acknowledges  that  if he or  she  is a  Registered
Representative  of an NASD member firm, he or she must give such firm the notice
required  by the  NASD's  Rules  of Fair  Practice,  receipt  of  which  must be
acknowledged by such firm in Section 7.4 below.

      1.17 The  Subscriber  acknowledges  that at such  time,  if  ever,  as the
Securities are  registered (as such term is defined in Article V hereof),  sales
of the Securities will be subject to state securities laws.

                                       4
<PAGE>

      1.18 (a) The  Subscriber  agrees  not to issue any public  statement  with
respect to the Subscriber's  investment or proposed investment in the Company or
the terms of any agreement or covenant  between them and the Company without the
Company's  prior written  consent,  except such  disclosures  as may be required
under applicable law or under any applicable order, rule or regulation.

            (b) The Company  agrees not to disclose the names,  addresses or any
other  information about the Subscribers,  except as required by law;  provided,
that the Company may use the name of the  Subscriber  for any offering or in any
registration  statement  filed  pursuant to Article V in which the  Subscriber's
shares are included.

      1.19  The  Subscriber  agrees  to hold  the  Company  and  its  directors,
officers,  employees,  affiliates,  controlling  persons  and  agents  and their
respective  heirs,  representatives,  successors  and  assigns  harmless  and to
indemnify them against all liabilities, costs and expenses incurred by them as a
result of (a) any sale or  distribution  of the  Securities by the Subscriber in
violation of the Securities Act or any applicable state securities or "blue sky"
laws;  or (b) any false  representation  or warranty or any breach or failure by
the  Subscriber  to comply  with any  covenant  made by the  Subscriber  in this
Agreement  (including  the  Confidential  Investor  Questionnaire  contained  in
Article VII herein) or any other document  furnished by the Subscriber to any of
the foregoing in connection with this transaction.

II. REPRESENTATIONS BY AND COVENANTS OF THE COMPANY

      The Company hereby represents and warrants to the Subscriber that:

      2.1  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 Oregon and has full corporate power and authority to conduct its
business.

      2.2  Capitalization   and  Voting  Rights.  The  authorized,   issued  and
outstanding  capital  stock  of the  Company  is as set  forth on  Schedule  2.2
attached hereto and all issued and outstanding shares of the Company are validly
issued,  fully  paid and  nonassessable.  Except  as set  forth in the  Offering
Materials, there are no outstanding options, warrants,  agreements,  convertible
securities,  preemptive  rights or other rights to subscribe  for or to purchase
any shares of capital stock of the Company.  Except as set forth in the Offering
Materials and as otherwise  required by law, there are no restrictions  upon the
voting or transfer of any of the shares of capital stock of the Company pursuant
to the Company's  Articles of Incorporation  (the "Articles of  Incorporation"),
By-Laws or other  governing  documents or any agreement or other  instruments to
which the Company is a party or by which the Company is bound.

      2.3  Authorization;  Enforceability.  The Company has all corporate right,
power  and  authority  to  enter  into  this  Agreement  and to  consummate  the
transactions  contemplated  hereby.  All  corporate  action  on the  part of the
Company,  its directors  and  stockholders  necessary for the (i)  authorization
execution,  delivery and performance of this Agreement by the Company;  and (ii)
authorization, sale, issuance and delivery of the Securities contemplated hereby
and the performance of the Company's  obligations hereunder has been taken. This

                                       5
<PAGE>

Agreement has been duly executed and delivered by the Company and  constitutes a
legal,  valid and binding  obligation  of the Company,  enforceable  against the
Company in  accordance  with its terms,  subject to laws of general  application
relating to  bankruptcy,  insolvency  and the relief of debtors and rules of law
governing specific  performance,  injunctive relief or other equitable remedies,
and to  limitations of public  policy.  The Common Stock,  when issued and fully
paid for in accordance with the terms of this Agreement, will be validly issued,
fully  paid  and  nonassessable.  The  issuance  and  sale of the  Common  Stock
contemplated  hereby  will not give rise to any  preemptive  rights or rights of
first  refusal on behalf of any person which have not been waived in  connection
with this offering.

      2.4 No Conflict; Governmental Consents.

            (a) The execution and delivery by the Company of this  Agreement and
the consummation of the transactions  contemplated hereby will not result in the
violation  of  any  material  law,  statute,  rule,  regulation,   order,  writ,
injunction,  judgment or decree of any court or governmental  authority to or by
which the Company is bound, or of any provision of the Articles of Incorporation
or By-Laws of the Company,  and will not conflict  with, or result in a material
breach or violation of, any of the terms or provisions  of, or constitute  (with
due notice or lapse of time or both) a default under, any lease, loan agreement,
mortgage,  security agreement,  trust indenture or other agreement or instrument
to which the  Company  is a party or by which it is bound or to which any of its
properties or assets is subject, nor result in the creation or imposition of any
lien upon any of the properties or assets of the Company.

            (b) No  consent,  approval,  authorization  or  other  order  of any
governmental  authority is required to be obtained by the Company in  connection
with the  authorization,  execution  and delivery of this  Agreement or with the
authorization,  issue  and sale of the  Units,  except  such  filings  as may be
required  to be made with the SEC,  NASD,  NASDAQ  and with any state or foreign
blue sky or securities regulatory authority.

      2.5 Licenses. Except as otherwise set forth in the Memorandum, the Company
has sufficient licenses, permits and other governmental authorizations currently
required for the conduct of its business or  ownership of  properties  and is in
all material respects in compliance therewith.

      2.6  Litigation.  The Company knows of no pending or  threatened  legal or
governmental  proceedings  against the Company which could materially  adversely
affect the business,  property, financial condition or operations of the Company
or which  materially  and adversely  questions the validity of this Agreement or
any agreements related to the transactions  contemplated  hereby or the right of
the  Company  to  enter  into  any of  such  agreements,  or to  consummate  the
transactions  contemplated  hereby or  thereby.  The  Company  is not a party or
subject to the provisions of any order, writ, injunction,  judgment or decree of
any  court or  government  agency  or  instrumentality  which  could  materially
adversely affect the business,  property,  financial  condition or operations of
the  Company.  There is no action,  suit,  proceeding  or  investigation  by the
Company  currently  pending  in any court or before any  arbitrator  or that the
Company intends to initiate.

                                       6
<PAGE>

      2.7 Disclosure.  The information set forth in the Offering Materials as of
the date hereof  contains no untrue  statement  of a material  fact nor omits to
state a  material  fact  necessary  in order to make  the  statements  contained
therein,  in  light  of the  circumstances  under  which  they  were  made,  not
misleading.

      2.8 Investment Company.  The Company is not an "investment company" within
the meaning of such term under the  Investment  Company Act of 1940, as amended,
and the rules and regulations of the SEC thereunder.

      2.9 Placement Agent. The Company has engaged,  consented to and authorized
the  Placement  Agent to act as  agent of the  Company  in  connection  with the
transactions  contemplated by this Agreement. The Company will pay the Placement
Agent a  commission  in the form of both cash and  warrants  (the  "Introduction
Warrants") and will  reimburse the Placement  Agent's  reasonable  out-of-pocket
expenses  incurred in connection  with the Offering,  and the Company  agrees to
indemnify  and  hold  harmless  the  Subscribers  from  and  against  all  fees,
commissions  or other payments  owning by the Company to the Placement  Agent or
any other person or firm acting on behalf of the Company hereunder.

      2.10 Intellectual Property.

            (i) To the best of its  knowledge,  the  Company  owns or  possesses
sufficient legal rights to all patents, trademarks,  service marks, trade names,
copyrights,  trade secrets,  licenses,  information and other proprietary rights
and  processes  necessary  for its  business as now  conducted  and as presently
proposed  to be  conducted,  without  any known  infringement  of the  rights of
others. Except as disclosed in the Memorandum, there are no material outstanding
options,   licenses  or  agreements  of  any  kind  relating  to  the  foregoing
proprietary  rights,  nor is the  Company  bound by or a party  to any  material
options,  licenses  or  agreements  of any kind  with  respect  to the  patents,
trademarks,  service marks, trade names,  copyrights,  trade secrets,  licenses,
information  and other  proprietary  rights and processes of any other person or
entity other than such licenses or agreements  arising from the purchase of "off
the shelf" or  standard  products.  The  Company  has not  received  any written
communications  alleging  that the Company has  violated or, by  conducting  its
business  as  presently  proposed  to be  conducted,  would  violate  any of the
patents, trademarks,  service marks, trade names, copyrights or trade secrets or
other proprietary rights of any other person or entity.

            (ii) Except as disclosed in the Memorandum, the Company is not aware
that any of its employees is obligated under any contract  (including  licenses,
covenants or  commitments of any nature) or other  agreement,  or subject to any
judgment,  decree or order of any court or  administrative  agency,  that  would
interfere  with their  duties to the  Company or that  would  conflict  with the
Company's business as presently conducted.

            (iii) Neither the execution nor delivery of this Agreement,  nor the
carrying on of the Company's  business by the employees of the Company,  nor the
conduct of the Company's business as presently conducted, will, to the Company's
knowledge,  conflict  with or  result in a breach of the  terms,  conditions  or
provisions  of, or  constitute  a  default  under,  any  contract,  covenant  or
instrument under which any employee is now obligated.

                                       7
<PAGE>

            (iv) To the Company's knowledge, no employee of the Company, nor any
consultant with whom the Company has contracted,  is in violation of any term of
any  employment  contract,   proprietary  information  agreement  or  any  other
agreement  relating to the right of any such individual to be employed by, or to
contract  with, the Company  because of the nature of the business  conducted by
the Company;  and to the Company's  knowledge  the  continued  employment by the
Company of its present employees, and the performance of the Company's contracts
with its independent  contractors,  will not result in any such  violation.  The
Company has not received any written notice alleging that any such violation has
occurred.  Except as described in the Memorandum, no employee of the Company has
been  granted  the  right  to  continued  employment  by the  Company  or to any
compensation following termination of employment with the Company except for any
of the same which would not have a material  adverse  effect on the  business of
the Company. The Company is not aware that any officer, key employee or group of
employees  intends to terminate his, her or their  employment  with the Company,
nor does the Company have a present intention to terminate the employment of any
officer, key employee or group of employees.

      2.11 Title to Properties and Assets;  Liens, Etc. The Company has good and
marketable  title to its  properties  and assets,  including the  properties and
assets  reflected in the most recent  balance  sheet  included in the  Financial
Statements,  and good title to its leasehold estates, in each case subject to no
mortgage,  pledge,  lien,  lease,  encumbrance  or charge,  other than (a) those
resulting  from  taxes  which  have not yet  become  delinquent;  (b)  liens and
encumbrances  which do not  materially  detract  from the value of the  property
subject  thereto or materially  impair the  operations  of the Company;  and (c)
those that have otherwise arisen in the ordinary course of business. The Company
is in compliance with all material terms of each lease to which it is a party or
is otherwise bound.

      2.12  Obligations  to  Related   Parties.   Except  as  described  in  the
Memorandum,  there are no  obligations  of the Company to  officers,  directors,
stockholders,  or employees of the Company  other than (a) for payment of salary
or other  compensation for services  rendered,  (b) reimbursement for reasonable
expenses  incurred on behalf of the Company and (c) for other standard  employee
benefits  made  generally  available to all  employees  (including  stock option
agreements  outstanding  under any stock  option  plan  approved by the Board of
Directors of the  Company).  Except as may be disclosed in the  Memorandum,  the
Company  is not a  guarantor  or  indemnitor  of any  indebtedness  of any other
person, firm or corporation.

III. TERMS OF SUBSCRIPTION

      3.1  Pending  the sale of the  Units,  all funds paid  hereunder  shall be
deposited with Continental Stock Transfer & Trust Company.

      3.2 Certificates  representing the Common Stock and Warrants  purchased by
the  Subscriber  pursuant to this Agreement will be prepared for delivery to the
Subscriber  within 15 business days following the Closing at which such purchase
takes place. The Subscriber hereby authorizes and directs the Company to deliver
the  certificates  representing  the Common Stock and Warrants  purchased by the
Subscriber  pursuant to this Agreement directly to the Subscriber's  residential
or business address indicated on the signature page hereto.

                                        8
<PAGE>

IV. CONDITIONS TO OBLIGATIONS OF THE SUBSCRIBERS

      4.1 The  Subscriber's  obligation  to purchase the Units at the Closing at
which such purchase is to be  consummated  is subject to the  fulfillment  on or
prior to such  Closing of the  following  conditions,  which  conditions  may be
waived at the option of each Subscriber to the extent permitted by law:

            (a) Covenants. All covenants, agreements and conditions contained in
this  Agreement  to be  performed by the Company on or prior to the date of such
Closing shall have been performed or complied with in all material respects.

            (b) No Legal  Order  Pending.  There shall not then be in effect any
legal or other order enjoining or restraining the  transactions  contemplated by
this Agreement.

            (c) No Law Prohibiting or Restricting  Such Sale. There shall not be
in effect any law, rule or regulation  prohibiting or  restricting  such sale or
requiring  any  consent or  approval  of any  person,  which shall not have been
obtained,  to  issue  the  Securities  (except  as  otherwise  provided  in this
Agreement).

            (d)  Acquisition  by Public  Company.  The  Company  shall have been
acquired by a corporation whose stock is publicly traded on the Over-the-Counter
Bulletin Board.

V. REGISTRATION RIGHTS

      5.1 Definitions. As used in this Agreement, the following terms shall have
the following meanings.

            (a) The term "Acquisition" shall mean the acquisition of the Company
by a corporation whose stock is publicly traded on the Over-the-Counter Bulletin
Board.

            (b) The term  "Holder"  shall mean any  person  owning or having the
right to acquire Registrable Securities or any permitted transferee of a Holder.

            (c) The terms "register," "registered" and "registration" refer to a
registration  effected  by  preparing  and filing a  registration  statement  or
similar  document in compliance  with the Securities Act, and the declaration or
order of effectiveness of such registration statement or document.

            (d) The term  "Registrable  Securities"  shall mean:  (i) the Common
Stock (including the Common Stock issuable upon exercise of the Warrants);  (ii)
the shares of Common Stock issuable upon exercise of the Introduction  Warrants;
and (iii) any other shares of Common Stock with respect to which the Company has
granted or may in the future  grant  registration  rights  pursuant  to separate
agreements;  provided,  however,  that  securities  shall  only  be  treated  as
Registrable  Securities  if and  only  for so long as they  (A)  have  not  been
disposed of pursuant to a registration  statement declared effective by the SEC;
(B)  have not been  sold in a  transaction  exempt  from  the  registration  and

                                       9
<PAGE>

prospectus  delivery  requirements  of the  Securities  Act so that all transfer
restrictions  and restrictive  legends with respect thereto are removed upon the
consummation of such sale; (C) are held by a Holder or a permitted transferee of
a Holder  pursuant  to Section  5.11;  and (D) may not be disposed of under Rule
144(k) under the Securities Act without restriction.

      5.2 Piggyback Registration.

            (a) The Company  agrees that if, at any time, and from time to time,
after the earlier to occur of (i) an Acquisition  and (ii) a Trading Event,  the
Board of Directors of the Company (the "Board") shall  authorize the filing of a
registration  statement  under the  Securities  Act (other  than a  registration
statement  on Form  S-8,  Form S-4 or any  other  form  that  does  not  include
substantially  the  same  information  as would  be  required  in a form for the
general registration of securities) in connection with the proposed offer of any
of its  securities  by it or any of its  stockholders,  the Company  shall:  (A)
promptly notify each Holder that such  registration  statement will be filed and
that the  Registrable  Securities  then held by such  Holder will be included in
such  registration   statement  at  such  Holder's   request;   (B)  cause  such
registration  statement to cover all of such  Registrable  Securities  issued to
such Holder for which such Holder  requests  inclusion;  (C) use best efforts to
cause such  registration  statement to become  effective as soon as practicable;
and (D) take all other  reasonable  action  necessary under any federal or state
law or regulation of any  governmental  authority to permit all such Registrable
Securities that have been issued to such Holder to be sold or otherwise disposed
of, and will maintain such  compliance  with each such federal and state law and
regulation  of any  governmental  authority  for the period  necessary  for such
Holder  to  promptly  effect  the  proposed  sale  or  other  disposition.

            (b)  Notwithstanding  any other  provision  of this Section 5.2, the
Company  may at any time,  abandon or delay any  registration  commenced  by the
Company.  In the event of such an abandonment by the Company,  the Company shall
not be required to continue  registration of shares  requested by the Holder for
inclusion,  the Holder shall retain the right to request  inclusion of shares as
set  forth  above  and the  withdrawn  registration  shall not be deemed to be a
registration request for the purposes of Section 5.2(c) below.

            (c) Each Holder shall have the right to request  inclusion of any of
its  Registrable  Securities  in a  registration  statement as described in this
Section 5.2, up to three times.

      5.3  Mandatory  Registration.  The  Company  agrees  that it  will  file a
registration statement covering the resale of the Registrable Securities as soon
as  practicable,  but in any event within 90 days from the final Closing date of
the Offering.

      5.4  Registration  Procedures.  Whenever  required under this Article V to
include Registrable Securities in a Company registration statement,  the Company
shall, as expeditiously as reasonably possible:

                                       10
<PAGE>

            (a) Use best  efforts to (i) cause such  registration  statement  to
become effective, and (ii) cause such registration statement to remain effective
until the  earliest  to occur of (A) such  date as the  sellers  of  Registrable
Securities (the "Selling Holders") have completed the distribution  described in
the  registration  statement  and (B) such  time  that  all of such  Registrable
Securities  are no longer,  by reason of Rule 144(k) under the  Securities  Act,
required to be registered for the sale thereof by such Holders. The Company will
also use its best efforts to, during the period that such registration statement
is required to be maintained hereunder,  file such post-effective amendments and
supplements  thereto as may be required by the  Securities Act and the rules and
regulations  thereunder or otherwise to ensure that the  registration  statement
does not contain any untrue  statement of material  fact or omit to state a fact
required to be stated  therein or  necessary  to make the  statements  contained
therein,  in  light  of  the  circumstances  under  which  they  are  made,  not
misleading; provided, however, that if applicable rules under the Securities Act
governing the obligation to file a post-effective  amendment permits, in lieu of
filing a post-effective  amendment that (i) includes any prospectus  required by
Section  10(a)(3)  of the  Securities  Act or  (ii)  reflects  facts  or  events
representing a material or fundamental  change in the  information  set forth in
the registration statement, the Company may incorporate by reference information
required to be included in (i) and (ii) above to the extent such  information is
contained  in  periodic  reports  filed  pursuant  to Section 13 or 15(d) of the
Exchange Act in the registration statement.

            (b) Prepare and file with the SEC such amendments and supplements to
such  registration  statement,  and the prospectus  used in connection with such
registration statement, as may be necessary to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement.

            (c) Make available for inspection upon reasonable  notice during the
Company's  regular  business  hours  by each  Selling  Holder,  any  underwriter
participating in any distribution pursuant to such registration  statement,  and
any  attorney,  accountant  or other agent  retained by such  Selling  Holder or
underwriter,  all financial and other records, pertinent corporate documents and
properties  of the Company,  and cause the  Company's  officers,  directors  and
employees  to supply all  information  reasonably  requested by any such Selling
Holder,  underwriter,  attorney,  accountant  or agent in  connection  with such
registration statement.

            (d)  Furnish  to the  Selling  Holders  such  numbers of copies of a
prospectus,  including a preliminary  prospectus as amended or supplemented from
time to time, in conformity  with the  requirements  of the Securities  Act, and
such other  documents as they may reasonably  request in order to facilitate the
disposition of Registrable Securities owned by them.

            (e) Use best efforts to register and qualify the securities  covered
by such registration statement under such other federal or state securities laws
of such  jurisdictions as shall be reasonably  requested by the Selling Holders;
provided,  however,  that  the  Company  shall  not be  required  in  connection
therewith  or as a  condition  thereto to qualify  to do  business  or to file a
general  consent to service  of  process  in any such  states or  jurisdictions,
unless the Company is already subject to service in such jurisdiction and except
as may be required by the Securities Act.

                                       11
<PAGE>

            (f) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting  agreement, in usual and customary
form,  with the managing  underwriter  of such  offering.  Each  Selling  Holder
participating  in such  underwriting  shall  also  enter  into and  perform  its
obligations under such an agreement.

            (g) Notify each  Holder of  Registrable  Securities  covered by such
registration  statement,  at any time  when a  prospectus  relating  thereto  is
required to be delivered  under the  Securities  Act, (i) when the  registration
statement or any  post-effective  amendment  and  supplement  thereto has become
effective;  (ii) of the issuance by the SEC of any stop order or the  initiation
of  proceedings  for that  purpose (in which event the Company  shall make every
effort to obtain the  withdrawal of any order  suspending  effectiveness  of the
registration  statement  at the  earliest  possible  time or  prevent  the entry
thereof);  (iii) of the receipt by the Company of any notification  with respect
to the suspension of the qualification of the Registrable Securities for sale in
any jurisdiction or the initiation of any proceeding for such purpose;  and (iv)
of the  happening of any event as a result of which the  prospectus  included in
such registration  statement, as then in effect, includes an untrue statement of
a material fact or omits to state a material fact required to be stated  therein
or necessary to make the  statements  therein not misleading in the light of the
circumstances then existing.

            (h) Cause all such Registrable Securities registered hereunder to be
listed  on each  securities  exchange  or  quotation  service  on which  similar
securities  issued by the  Company  are then  listed  or  quoted  or, if no such
similar  securities  are listed or quoted on a securities  exchange or quotation
service,   apply  for  qualification  and  use  best  efforts  to  qualify  such
Registrable  Securities for inclusion on the New York Stock  Exchange,  American
Stock Exchange or listing on a quotation  system of the National  Association of
Securities Dealers, Inc.

            (i)  Provide a  transfer  agent and  registrar  for all  Registrable
Securities   registered  pursuant  hereunder  and  CUSIP  number  for  all  such
Registrable  Securities,  in each case not later than the effective date of such
registration.

            (j)   Cooperate   with  the  Selling   Holders   and  the   managing
underwriters,  if any, to  facilitate  the timely  preparation  and  delivery of
certificates   representing  the  Registrable   Securities  to  be  sold,  which
certificates will not bear any restrictive  legends; and enable such Registrable
Securities  to be in such  denominations  and  registered  in such  names as the
managing underwriters, if any, shall request at least two business days prior to
any sale of the Registrable Securities to the underwriters.

            (k) In connection with an underwritten offering,  cause the officers
of the Company to provide reasonable assistance in the preparation of, any "road
show"  presentation  to  potential  investors as the  managing  underwriter  may
determine.

            (l) Comply with all applicable  rules and regulations of the SEC and
make generally  available to its security holders earning statements  satisfying
the  provisions of Section 11(a) of the  Securities  Act and Rule 158 thereunder
(or any similar  rule  promulgated  under the  Securities  Act) no later than 50
calendar  days after the end of any 3-month  period (or 105 calendar  days after
the end of any 12-month  period if such period is a fiscal year) (i)  commencing
at the end of any fiscal  quarter in which  Registrable  Securities  are sold to
underwriters in a firm  commitment or best efforts  underwritten  offering,  and
(ii) if not sold to  underwriters  in such an offering,  commencing on the first
day of the first fiscal  quarter of the Company,  after the effective  date of a
registration statement, which statements shall cover said period.

                                       12
<PAGE>

            (m) If the  offering  is  underwritten  and  at the  request  of any
Selling  Holder,  use its best  efforts to furnish on the date that  Registrable
Securities  are  delivered  to  the  underwriters  for  sale  pursuant  to  such
registration:  (i) opinions dated such date of counsel  representing the Company
for the purposes of such  registration,  addressed to the  underwriters  and the
transfer agent for the Registrable Securities so delivered, respectively, to the
effect  that  such  registration   statement  has  become  effective  under  the
Securities Act and such Registrable Securities are freely tradable, and covering
such other matters as are  customarily  covered in opinions of issuer's  counsel
delivered to underwriters  and transfer agents in underwritten  public offerings
and (ii) a letter dated such date from the  independent  public  accountants who
have  certified  the  financial  statements  of  the  Company  included  in  the
registration  statement  or  the  prospectus,   covering  such  matters  as  are
customarily  covered  in  accountants'  letters  delivered  to  underwriters  in
underwritten public offerings.

      5.5  Furnish  Information.  It  shall  be a  condition  precedent  to  the
obligation  of the Company to take any action  pursuant  to this  Article V with
respect to the  Registrable  Securities  of any Selling  Holder that such Holder
shall  furnish  to the  Company  such  information  regarding  the  Holder,  the
Registrable   Securities  held  by  the  Holder,  and  the  intended  method  of
disposition of such securities as shall be reasonably required by the Company to
effect the registration of such Holder's Registrable Securities.

      5.6 Registration Expenses. The Company shall bear and pay all Registration
Expenses incurred in connection with any  registration,  filing or qualification
of Registrable  Securities with respect to registrations pursuant to Section 5.2
for each Holder, but excluding  underwriting  discounts and commissions relating
to  Registrable  Securities  and  excluding  any  professional  fees or costs of
accounting, financial or legal advisors to any of the Holders.

      5.7 Underwriting  Requirements.  In connection with any offering involving
an underwriting of shares of the Company's  capital stock, the Company shall not
be  required  under  Section  5.2 to  include  any of the  Holders'  Registrable
Securities in such underwriting unless they accept the terms of the underwriting
as agreed upon  between the Company and the  underwriters  selected by it (or by
other  persons  entitled  to  select  the  underwriters),  and then only in such
quantity  as the  underwriters  determine  in  their  sole  discretion  will not
jeopardize  the success of the offering by the  Company.  If the total amount of
securities,  including Registrable  Securities,  requested by stockholders to be
included in such offering  exceeds the amount of  securities  sold other than by
the  Company  that the  underwriters  determine  in  their  sole  discretion  is
compatible with the success of the offering,  then the Company shall be required
to  include  in the  offering  only that  number of such  securities,  including
Registrable   Securities,   which  the  underwriters  determine  in  their  sole
discretion  will not jeopardize  the success of the offering (the  securities so
included to be apportioned pro rata among the selling stockholders  according to
the total amount of  securities  entitled to be included  therein  owned by each
selling  stockholder or in such other proportions as shall mutually be agreed to
by such  selling  stockholders).  For  purposes of the  preceding  parenthetical
concerning  apportionment,  for  any  selling  stockholder  who is a  holder  of
Registrable  Securities  and is a  partnership  or  corporation,  the  partners,
retired  partners and  stockholders  of such  holder,  or the estates and family
members of any such partners and retired partners and any trusts for the benefit

                                       13
<PAGE>

of any of  the  foregoing  persons  shall  be  deemed  to be a  single  "selling
stockholder,"  and  any  pro-rata   reduction  with  respect  to  such  "selling
stockholder"  shall be based  upon  the  aggregate  amount  of  shares  carrying
registration  rights  owned by all  entities  and  individuals  included in such
"selling stockholder," as defined in this sentence.

      5.8 Delay of  Registration.  No Holder  shall  have any right to obtain or
seek an injunction  restraining or otherwise  delaying any such  registration as
the  result  of  any   controversy   that  might  arise  with   respect  to  the
interpretation or implementation of this Article.

      5.9  Indemnification.  In the event that any  Registrable  Securities  are
included in a registration statement under this Article V:

            (a) To the extent  permitted by law, the Company will  indemnify and
hold harmless each Holder,  any  underwriter  (as defined in the Securities Act)
for such Holder and each person, if any, who controls such Holder or underwriter
within the  meaning of the  Securities  Act or the  Exchange  Act,  against  any
losses,  claims,  damages,  or liabilities  (joint or several) to which they may
become  subject under the Securities  Act, or the Exchange Act,  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,  omissions  or
violations (collectively a "Violation"):  (i) any untrue statement of a material
fact  contained  in  such  registration  statement,  including  any  preliminary
prospectus  or  final  prospectus   contained   therein  or  any  amendments  or
supplements thereto, (ii) the omission to state therein a material fact required
to  be  stated  therein,  or  necessary  to  make  the  statements  therein  not
misleading,  or (iii) any  violation by the Company of the  Securities  Act, the
Exchange Act, or any rule or regulation promulgated under the Securities Act, or
the Exchange Act, and the Company will pay to each such Holder,  underwriter  or
controlling person, as incurred, 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 Section  5.9(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  Company  (which  consent  shall  not be
unreasonably withheld), nor shall the Company be liable in any such case for any
such loss, claim, damage,  liability, or action to the extent that it arises out
of or is based upon a Violation  which occurs in reliance upon and in conformity
with written  information  furnished  expressly for use in connection  with such
registration by any such Holder, underwriter or controlling person.

            (b) To the  extent  permitted  by  law,  each  Selling  Holder  will
indemnify  and hold  harmless the Company,  each of its  directors,  each of its
officers,  each person,  if any, who controls the Company  within the meaning of
the Securities Act, any underwriter, any other Holder selling securities in such
registration  statement and any  controlling  person of any such  underwriter or
other Holder,  against any losses,  claims,  damages,  or liabilities  (joint or
several) to which any of the  foregoing  persons may become  subject,  under the
Securities Act, or the Exchange Act, insofar as such losses, claims, damages, or
liabilities  (or actions in respect  thereto) arise out of or are based upon any
Violation,  in each  case to the  extent  (and  only to the  extent)  that  such
Violation  occurs in reliance  upon and in conformity  with written  information
furnished by such Holder expressly for use in connection with such registration;
and each  such  Holder  will  pay,  as  incurred,  any  legal or other  expenses
reasonably  incurred by any person  intended to be indemnified  pursuant to this

                                       14
<PAGE>

Section  5.9(b),  in connection with  investigating  or defending any such loss,
claim,  damage,  liability,  or action;  provided,  however,  that the indemnity
agreement  contained in this  Section  5.9(b) 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 Holder,  which consent shall
not be unreasonably  withheld;  provided,  further,  that, in no event shall any
indemnity  under this Section 5.9(b) exceed the greater of the cash value of the
(i)  gross  proceeds  from the  Offering  received  by such  Holder or (ii) such
Holder's  investment  pursuant to this  Agreement as set forth on the  signature
page attached hereto.

            (c)  Promptly  after  receipt  by an  indemnified  party  under this
Section  5.9  of  notice  of  the  commencement  of any  action  (including  any
governmental  action),  such  indemnified  party  shall,  if a claim in  respect
thereof is to be made  against any  indemnifying  party under this  Section 5.9,
deliver to the indemnifying  party a written notice of the commencement  thereof
and the  indemnifying  party shall have the right to participate in, and, to the
extent the indemnifying  party so desires,  jointly with any other  indemnifying
party similarly notified, to assume the defense thereof with counsel selected by
the  indemnifying  party and approved by the  indemnified  party (whose approval
shall not be  unreasonably  withheld);  provided,  however,  that an indemnified
party  (together  with all other  indemnified  parties which may be  represented
without  conflict by one  counsel)  shall have the right to retain one  separate
counsel,  with the fees and expenses to be paid by the  indemnifying  party,  if
representation  of  such  indemnified  party  by  the  counsel  retained  by the
indemnifying  party would be inappropriate due to actual or potential  differing
interests between such indemnified party and any other party represented by such
counsel  in such  proceeding.  The  failure  to  deliver  written  notice to the
indemnifying  party within a  reasonable  time of the  commencement  of any such
action, if prejudicial to its ability to defend such action,  shall relieve such
indemnifying  party of any liability to the indemnified party under this Section
5.9, but the omission so to deliver  written  notice to the  indemnifying  party
will not relieve it of any liability that it may have to any  indemnified  party
otherwise than under this Section 5.9.

            (d) If the indemnification  provided for in this Section 5.9 is held
by a court of competent  jurisdiction to be unavailable to an indemnified  party
with  respect to any loss,  liability,  claim,  damage,  or expense  referred to
therein,  then the indemnifying  party, in lieu of indemnifying such indemnified
party  hereunder,  shall  contribute  to the  amount  paid  or  payable  by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such  proportion  as is  appropriate  to reflect  the  relative  fault of the
indemnifying  party on the one hand and of the indemnified party on the other in
connection  with  the  statements  or  omissions  that  resulted  in such  loss,
liability,  claim,  damage,  or expense as well as any other relevant  equitable
considerations.  The  relative  fault  of  the  indemnifying  party  and  of the
indemnified  party shall be  determined  by reference  to,  among other  things,
whether the untrue or alleged untrue statement of a material fact or the alleged
omission  to state a  material  fact  relates  to  information  supplied  by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge,  access to  information,  and  opportunity to correct or prevent such
statement or omission.

                                       15
<PAGE>

            (e) Notwithstanding the foregoing, to the extent that the provisions
on  indemnification  and  contribution  contained in an  underwriting  agreement
entered into in connection with an underwritten  public offering are in conflict
with the foregoing  provisions,  the provisions in such  underwriting  agreement
shall control.

            (f) The  obligations  of the Company and Holders  under this Section
5.9 shall survive the completion of the Offering.

      5.10 Reports Under Securities  Exchange Act of 1934. With a view to making
available  to the  Holders  the  benefits  of Rule  144 and  any  other  rule or
regulation of the SEC that may at any time permit a Holder to sell securities of
the Company to the public without  registration or pursuant to a registration on
Form S-3, the Company agrees to:

            (a) make and keep public information  available,  as those terms are
understood  and  defined  in Rule  144,  at all  times  after 90 days  after the
effective  date  of the  registration  statement  filed  in  connection  with an
Acquisition;

            (b) file  with the SEC in a timely  manner  all  reports  and  other
documents required of the Company under the Securities Act and the Exchange Act;
and

            (c)  furnish  to  any  Holder,  so  long  as  the  Holder  owns  any
Registrable  Securities,  forthwith  upon  request (i) a copy of the most recent
annual or quarterly  report of the Company and such other  reports and documents
so filed by the Company,  and (ii) such other  information  as may be reasonably
requested  in  availing  any Holder of any rule or  regulation  of the SEC which
permits the selling of any such securities  without  registration or pursuant to
such form.

      5.11  Permitted  Transferees.  The rights to cause the Company to register
Registrable  Securities granted to the Holders by the Company under this Article
V may be  assigned  in full by a Holder in  connection  with a transfer  by such
Holder of its  Registrable  Securities  if: (a) such Holder gives prior  written
notice to the Company;  (b) such transferee  agrees to comply with the terms and
provisions of this Agreement;  (c) such transfer is otherwise in compliance with
this Agreement;  and (d) such transfer is otherwise  effected in accordance with
applicable  securities  laws.  Except as specifically  permitted by this Section
5.11, the rights of a Holder with respect to  Registrable  Securities as set out
herein shall not be transferable to any other Person, and any attempted transfer
shall cause all rights of such Holder therein to be forfeited.

      5.12 Termination of Registration Rights The right of any Holder to request
inclusion  in any  registration  pursuant to Section 5.2 shall  terminate if all
shares of  Registrable  Securities  held by such Holder may  immediately be sold
under Rule 144(k).

                                       16
<PAGE>

VI. MISCELLANEOUS

      6.1 Any  notice or other  communication  given  hereunder  shall be deemed
sufficient  if in writing  and sent by  registered  or  certified  mail,  return
receipt  requested,  or  delivered  by hand against  written  receipt  therefor,
addressed as follows:

                  if to the Company, to it at:

                  Administration for International Credit & Investment, Inc.
                  12520 High Bluff Drive, Suite 260
                  San Diego, CA 92130
                  Attn:  Wolfgang Grabher, Chief Executive Officer

                  With a copy to:

                  Sichenzia Ross Friedman Ference LLP
                  1065 Avenue of the Americas
                  New York, NY 10018
                  Attn:  Marc Ross, Esq.

                  if to the Subscriber, to the Subscriber's address indicated on
                  the signature page of this Agreement.

Notices  shall be deemed to have been given or delivered on the date of mailing,
except notices of change of address, which shall be deemed to have been given or
delivered when received.

      6.2 Except as  otherwise  provided  herein,  this  Agreement  shall not be
changed,  modified  or amended  except by a writing  signed by the parties to be
charged,  and this  Agreement may not be  discharged  except by  performance  in
accordance with its terms or by a writing signed by the party to be charged.

      6.3 Subject to the  provisions of Section 5.11,  this  Agreement  shall be
binding  upon and  inure  to the  benefit  of the  parties  hereto  and to their
respective heirs, legal representatives,  successors and assigns. This Agreement
sets forth the entire agreement and understanding  between the parties as to the
subject  matter  hereof  and  merges  and  supersedes  all  prior   discussions,
agreements and understandings of any and every nature among them.

      6.4 Upon the execution and delivery of this  Agreement by the  Subscriber,
this Agreement shall become a binding  obligation of the Subscriber with respect
to the purchase of Common Stock as herein  provided,  subject,  however,  to the
right  hereby  reserved  by the Company to enter into the same  agreements  with
other subscribers and to add and/or delete other persons as subscribers.

      6.5  NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY
OF THE  PARTIES  HERETO,  THE  PARTIES  EXPRESSLY  AGREE  THAT ALL THE TERMS AND
PROVISIONS HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK WITHOUT REGARD TO SUCH STATE'S  PRINCIPLES OF CONFLICTS

                                       17
<PAGE>

OF LAW. IN THE EVENT THAT A JUDICIAL PROCEEDING IS NECESSARY, THE SOLE FORUM FOR
RESOLVING  DISPUTES  ARISING OUT OF OR RELATING TO THIS AGREEMENT IS THE SUPREME
COURT OF THE STATE OF NEW YORK IN AND FOR THE COUNTY OF NEW YORK OR THE  FEDERAL
COURTS FOR SUCH STATE AND COUNTY,  AND ALL RELATED APPELLATE COURTS, THE PARTIES
HEREBY IRREVOCABLY  CONSENT TO THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID
VENUE.

      6.6 In order to discourage  frivolous claims the parties agree that unless
a  claimant  in  any  proceeding  arising  out of  this  Agreement  succeeds  in
establishing   his  claim  and  recovering  a  judgment  against  another  party
(regardless of whether such claimant  succeeds  against one of the other parties
to the  action),  then the other party  shall be  entitled to recover  from such
claimant all of its/their  reasonable legal costs and expenses  relating to such
proceeding and/or incurred in preparation therefor.

      6.7 The  holding  of any  provision  of this  Agreement  to be  invalid or
unenforceable  by a court of competent  jurisdiction  shall not affect any other
provision of this Agreement, which shall remain in full force and effect. If any
provision  of  this  Agreement  shall  be  declared  by  a  court  of  competent
jurisdiction  to be invalid,  illegal or incapable of being enforced in whole or
in part, such provision shall be interpreted so as to remain  enforceable to the
maximum  extent  permissible  consistent  with  applicable law and the remaining
conditions and provisions or portions thereof shall nevertheless  remain in full
force and  effect  and  enforceable  to the  extent  they are  valid,  legal and
enforceable, and no provisions shall be deemed dependent upon any other covenant
or provision unless so expressed herein.

      6.8 It is  agreed  that a  waiver  by  either  party  of a  breach  of any
provision of this Agreement shall not operate,  or be construed,  as a waiver of
any subsequent breach by that same party.

      6.9 The parties  agree to execute and deliver all such further  documents,
agreements  and  instruments  and take such other and  further  action as may be
necessary or appropriate to carry out the purposes and intent of this Agreement.

      6.10 This  Agreement may be executed in two or more  counterparts  each of
which shall be deemed an original,  but all of which shall  together  constitute
one and the same instrument.

      6.11  Nothing in this  Agreement  shall  create or be deemed to create any
rights in any person or entity not a party to this Agreement, except (a) for the
holders of Registrable Securities.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       18
<PAGE>

VII. CONFIDENTIAL INVESTOR QUESTIONNAIRE

      7.1 The Subscriber represents and warrants that he, she or it comes within
one category marked below, and that for any category  marked,  he, she or it has
truthfully  set  forth,  where  applicable,  the  factual  basis or  reason  the
Subscriber  comes  within that  category.  ALL  INFORMATION  IN RESPONSE TO THIS
SECTION WILL BE KEPT STRICTLY  CONFIDENTIAL.  The undersigned  agrees to furnish
any additional  information which the Company deems necessary in order to verify
the answers set forth below.

<TABLE>
<CAPTION>
<S>              <C>
Category A ____  The  undersigned  is  an  individual  (not  a  partnership,   corporation,  etc.)  whose
                 individual  net worth,  or joint net worth  with his or her  spouse,  presently  exceeds
                 $1,000,000.

                 Explanation.  In calculating  net worth you may include equity in personal  property and
                 real estate,  including your principal residence,  cash, short-term  investments,  stock
                 and  securities.  Equity in personal  property  and real  estate  should be based on the
                 fair market value of such property less debt secured by such property.

Category B ____  The  undersigned  is an individual  (not a  partnership,  corporation,  etc.) who had an
                 income in excess of  $200,000  in each of the two most  recent  years,  or joint  income
                 with his or her  spouse  in  excess  of  $300,000  in each of those  years (in each case
                 including  foreign  income,  tax  exempt  income and full  amount of  capital  gains and
                 losses but  excluding  any income of other  family  members and any  unrealized  capital
                 appreciation)  and has a  reasonable  expectation  of reaching  the same income level in
                 the current year.

Category C ____  The  undersigned is a director or executive  officer of the Company which is issuing and
                 selling the Securities.

Category D ____  The  undersigned  is  a  bank;  a  savings  and  loan  association;  insurance  company;
                 registered investment company;  registered business development company;  licensed small
                 business  investment  company  ("SBIC");  or employee benefit plan within the meaning of
                 Title 1 of ERISA and (a) the investment  decision is made by a plan  fiduciary  which is
                 either  a  bank,   savings  and  loan  association,   insurance  company  or  registered
                 investment  advisor,  or (b) the plan has total assets in excess of $5,000,000 or (c) is
                 a self  directed  plan  with  investment  decisions  made  solely  by  persons  that are
                 accredited investors. (describe entity)

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

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

Category E ____  The  undersigned  is a private  business  development  company  as  defined  in  section
                 202(a)(22) of the Investment Advisors Act of 1940. (describe entity)

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

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

                                       19
<PAGE>

Category F ____  The undersigned is either a corporation,  partnership,  Massachusetts business trust, or
                 non-profit  organization  within  the  meaning  of  Section  501(c)(3)  of the  Internal
                 Revenue Code,  in each case not formed for the specific  purpose of acquiring the Common
                 Stock and with total assets in excess of $5,000,000. (describe entity)

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

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

Category G ____  The  undersigned  is a trust with total assets in excess of  $5,000,000,  not formed for
                 the specific  purpose of acquiring the  Securities,  where the purchase is directed by a
                 "sophisticated investor" as defined in Regulation 506(b)(2)(ii) under the Act.

Category H ____  The  undersigned  is an entity  (other  than a trust) in which all of the equity  owners
                 are  "accredited  investors"  within  one or more of the above  categories.  If  relying
                 upon this  Category  alone,  each  equity  owner must  complete a separate  copy of this
                 Agreement.  (describe entity)

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

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

Category I ____  The  undersigned  is not  within any of the  categories  above and is  therefore  not an
                 accredited investor.

                 The undersigned  agrees that the  undersigned  will notify the Company at any time on or
                 prior to the Closing Date in the event that the  representations  and warranties in this
                 Agreement shall cease to be true, accurate and complete.
</TABLE>

      7.2 SUITABILITY (please answer each question)

      (a)   For  an  individual   Subscriber,   please   describe  your  current
            employment,  including the company by which you are employed and its
            principal business:

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

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

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

      (b)   For  an  individual  Subscriber,  please  describe  any  college  or
            graduate degrees held by you:

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

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

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

      (c)   For all Subscribers, please list types of prior investments:

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

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

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

                                       20
<PAGE>

      (d)   For all Subscribers,  please state whether you have  participated in
            other private placements before:

            YES_______                         NO_______

      (e)   If your  answer to  question  (d) above was "YES",  please  indicate
            frequency of such prior participation in private placements of:

<TABLE>
<CAPTION>
                    Public                        Private                         Public or Private VoIP or other
                    Companies                     Companies                       Communications Companies
                    ---------                     ---------                       ------------------------
<S>                 <C>                           <C>                             <C>
Frequently
                    ---------------------------   ---------------------------     ---------------------------
Occasionally
                    ---------------------------   ---------------------------     ---------------------------
Never
                    ---------------------------   ---------------------------     ---------------------------
</TABLE>

      (f)   For  individual  Subscribers,  do you expect your  current  level of
            income to significantly decrease in the foreseeable future:

            YES_______                         NO_______

      (g)   For   trust,   corporate,   partnership   and  other   institutional
            Subscribers,  do you  expect  your  total  assets  to  significantly
            decrease in the foreseeable future:

            YES_______                         NO_______

      (h)   For all Subscribers, do you have any other investments or contingent
            liabilities which you reasonably  anticipate could cause you to need
            sudden cash requirements in excess of cash readily available to you:

            YES_______                         NO_______

      (i)   For all Subscribers,  are you familiar with the risk aspects and the
            non-liquidity  of  investments  such as the securities for which you
            seek to subscribe?

            YES_______                         NO_______

      (j)   For all Subscribers, do you understand that there is no guarantee of
            financial  return  on this  investment  and that you run the risk of
            losing your entire investment?

            YES_______                         NO_______

      7.3 MANNER IN WHICH TITLE IS TO BE HELD. (circle one)

            (a)   Individual Ownership

            (b)   Community Property

            (c)   Joint  Tenant with Right of  Survivorship  (both  parties must
                  sign)

            (d)   Partnership*

            (e)   Tenants in Common

            (f)   Company*

                                       21
<PAGE>

            (g)   Trust*

            (h)   Other*

      *     If Securities are being  subscribed  for by an entity,  the attached
            Certificate of Signatory must also be completed.

      7.4 NASD AFFILIATION.

Are you affiliated or associated with an NASD member firm (please check one):

Yes _________              No __________

If Yes, please describe:

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

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

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

*     If  Subscriber  is a Registered  Representative  with an NASD member firm,
      have the following acknowledgment signed by the appropriate party:

The undersigned NASD member firm acknowledges  receipt of the notice required by
Article 3, Sections 28(a) and (b) of the Rules of Fair Practice.

---------------------------------
Name of NASD Member Firm

By:
    ------------------------------
         Authorized Officer

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

      7.5 The undersigned is informed of the  significance to the Company of the
foregoing  representations  and answers  contained in the Confidential  Investor
Questionnaire  contained in this Article VII and such answers have been provided
under the assumption that the Company will rely on them.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       22
<PAGE>

NUMBER OF UNITS _________ X $2.00  = $_________ (THE "PURCHASE PRICE")

-------------------------------------       ------------------------------------
Signature                                   Signature (if purchasing jointly)

-------------------------------------       ------------------------------------
Name Typed or Printed                       Name Typed or Printed

-------------------------------------       ------------------------------------
Title (if Subscriber is an Entity)          Title (if Subscriber is an Entity)

-------------------------------------       ------------------------------------
Entity Name (if applicable)                 Entity Name (if applicable

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

-------------------------------------       ------------------------------------
Address                                     Address

-------------------------------------       ------------------------------------
City, State and Zip Code                    City, State and Zip Code

-------------------------------------       ------------------------------------
Telephone-Business                          Telephone-Business

-------------------------------------       ------------------------------------
Telephone-Residence                         Telephone-Residence

-------------------------------------       ------------------------------------
Facsimile-Business                          Facsimile-Business

-------------------------------------       ------------------------------------
Facsimile-Residence                         Facsimile-Residence

-------------------------------------       ------------------------------------
Tax ID # or Social Security #               Tax ID # or Social Security #

Name in which securities should be issued:
                                            ------------------------------------

Dated:                               , 2005
                  ------------------

      This   Subscription   Agreement   is   agreed  to  and   accepted   as  of
________________ , 2005.

                                       ADMINISTRATION FOR INTERNATIONAL CREDIT
                                       & INVESTMENT, INC.

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

                                       23
<PAGE>

                                             CERTIFICATE OF SIGNATORY

                                           (To be completed if Units are
                                        being subscribed for by an entity)

I,   ____________________________,   am  the   ____________________________   of
__________________________________________ (the "Entity").

I certify that I am empowered  and duly  authorized by the Entity to execute and
carry out the terms of the  Subscription  Agreement and to purchase and hold the
Common Stock and Warrants,  and certify further that the Subscription  Agreement
has been duly and  validly  executed on behalf of the Entity and  constitutes  a
legal and binding obligation of the Entity.

IN WITNESS WHEREOF,  I have set my hand this ________ day of  _________________,
2005

                                         ---------------------------------------
                                         (Signature)

                                       24
<PAGE>

                                  SCHEDULE 2.2
                                 CAPITALIZATION

I.    Authorized:

      (i)   52,500,000 shares of Common Stock, par value $.001 per share.

      (ii)  12,500,000  shares of Preferred  Stock,  par value $.01 per share of
            which no shares have been designated.

II.   Outstanding:

            Stockholder                                 Shares of Common Stock
            -----------                                 ----------------------
            Wolfgang Grabher                                 18,855,900
            Edward Sullivan                                     218,757
            Ewald Grabher                                        63,000
            Daren Barone                                        218,400
            LG International Financial Ltd.                     504,000
            Arthur Grabher                                       63,000
            Johanna Grabher                                      63,000
            Massimo Ballerini                                    54,600
            Frank Valdez                                         10,500
            Jil Grabher                                         105,000
            Roderick Thompson                                     2,100
            Patrice Farameh                                      10,500
            Joseph Lyle Putegnat III                          1,286,809
            Samuel Rogers                                       420,000
                                                          -------------
                                                             21,875,566
                                                          =============

II.   Warrants:

      Shares   reserved  for  issuance  upon  exercise  of  warrants  to  Strome
      Securities,  L.P.:  200,000.  Does not include  additional  warrants  that
      Strome  Securities,  L.P. is entitled to receive equal to 6% of the amount
      of Units sold in the  Offering to investors  introduced  to the Company by
      Strome Securities, L.P.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00081-of-00352.parquet"}]]