Document:

VIDEOLOCITY INTERNATIONAL INC.
                            PLACEMENT AGENT AGREEMENT

                                                      Dated as of: May 28,  2002

Westrock Advisors, Inc.
230 Park Avenue, Floor 9
New York, New York 10169

Ladies and Gentlemen:

         The undersigned,  Videolocity International Inc. , a Nevada corporation
(the  "Company"),  hereby  agrees  with  Westrock  Advisors  Inc.,  a  New  York
Corporation (the "Placement Agent") and Cornell Capital Partners, LP, A Delaware
Limited Partnership (the "Investor") as follows:

         1. Offering.
            ---------
         The Company hereby engages the Placement  Agent to act as its exclusive
placement agent in connection with the Equity Line of Credit Agreement dated the
date  hereof,  (the  "Equity  Line of Credit  Agreement")  pursuant to which the
Company  shall  issue  and sell to the  Investor,  from  time to  time,  and the
Investor shall  purchase from the Company (the  "Offering") up to Twenty Million
Dollars  ($20,000,000) of the Company's common stock (the "Commitment  Amount"),
par value $.001 per share (the "Common Stock"),  at price per share equal to the
Purchase Price, as that term is defined in the Equity Line of Credit  Agreement.
Pursuant  to the terms  hereof,  the  Placement  Agent shall  render  consulting
services to the Company with respect to the Equity Line of Credit  Agreement and
shall be  available  for  consultation  in  connection  with the  advances to be
requested by the Company pursuant to the Equity Line of Credit Agreement

         All  capitalized  terms used herein and not  otherwise  defined  herein
shall have the same  meaning  ascribed  to them as in the Equity  Line of Credit
Agreement. The Investor will be granted certain registration rights with respect
to the Common Stock as more fully set forth in the Registration Rights Agreement
between the Company and the  Investor  dated the date hereof (the  "Registration
Rights  Agreement").  The  documents to be executed and  delivered in connection
with the Offering,  including,  but not limited,  to this Agreement,  the Equity
Line of Credit  Agreement,  the Registration  Rights  Agreement,  and the Escrow
Agreement with First Union National Bank (the "Escrow Agreement"),  are referred
to sometimes hereinafter  collectively as the "Offering Materials",  which shall
also include the SEC Documents. The Company's Common Stock is sometimes referred
to hereinafter as the  "Securities."  The Placement Agent shall not be obligated
to sell any Securities and this Offering by the Placement  Agent shall be solely
on a "best efforts basis."

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<PAGE>

         2. Compensation.
            -------------

            A. Upon the  execution of this  Agreement the Company shall issue to
the  Placement  Agent or its  designee an amount  equal to ten  thousand  shares
(10,000)  shares of the Company's  Common Stock  (collectively,  the  "Placement
Agent's Shares ").  Furthermore  the Placement  Agent's Shares are to be held in
escrow by Butler  Gonzalez LLP for sixty (60) days  following the Effective Date
(as that term is defined in the  Registration  Rights  Agreement  dated the date
hereof).  However  in the  event  the  Registration  Statement  (as that term is
defined  in the  Registration  Rights  Agreement  dated the date  hereof) is not
declared  effective the Placement  Agent shall be entitled to sell the Placement
Agent's  Shares  pursuant  to Rule 144 one (1) year  from the date  hereof.  The
Placement Agent shall be entitled to "piggy-back"  registration rights triggered
upon  registration of any shares of Common Stock by the Investor with respect to
the Placement Agent's Shares pursuant to the Registration Rights Agreement dated
the date hereof.

         3.  Representations,  Warranties and Covenants of the Placement  Agent.
             -------------------------------------------------------------------

            A.  The  Placement  Agent  represents,  warrants  and  covenants  as
follows:

                (i) The Placement  Agent has the  necessary  power to enter into
this Agreement and to consummate the transactions contemplated hereby.

                (ii) The execution  and delivery by the Placement  Agent of this
Agreement and the consummation of the transactions  contemplated herein will not
result in any  violation  of, or be in conflict  with,  or  constitute a default
under, any agreement or instrument to which the Placement Agent is a party or by
which the Placement Agent or its properties are bound, or any judgment,  decree,
order or, to the Placement Agent's  knowledge,  any statute,  rule or regulation
applicable to the Placement Agent. This Agreement when executed and delivered by
the Placement Agent, will constitute the legal, valid and binding obligations of
the Placement  Agent,  enforceable in accordance  with their  respective  terms,
except  to the  extent  that (a) the  enforceability  hereof or  thereof  may be
limited by bankruptcy,  insolvency,  reorganization,  moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally, (b)
the enforceability hereof or thereof is subject to general principles of equity,
or (c) the  indemnification  provisions  hereof or thereof  may be held to be in
violation of public policy.

                (iii) Upon receipt and execution of this Agreement the Placement
Agent will  promptly  forward  copies of this  Agreement  to the  Company or its
counsel  and the  Investor or its  counsel.

                (iv) The Placement Agent will not intentionally  take any action
that it reasonably  believes  would cause the Offering to violate the provisions
of the  Securities  Act of 1933,  as amended  (the "1933 Act"),  the  Securities
Exchange  Act of 1934 (the "1934 Act"),  the  respective  rules and  regulations
promulgated  there under (the "Rules and  Regulations") or applicable "Blue Sky"
laws  of any  state  or  jurisdiction.  (v) The  Placement  Agent  will  use all
reasonable  efforts to  determine  (a)  whether the  Investor  is an  Accredited
Investor  and (b) that any  information  furnished  by the  Investor is true and
accurate.  The  Placement  Agent shall have no obligation to insure that (x) any
check,  note,  draft or other  means of  payment  for the  Common  Stock will be
honored,  paid or enforceable against the Investor in accordance with its terms,
or (y) subject to the performance of the Placement  Agent's  obligations and the

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<PAGE>

accuracy of the Placement Agent's representations and warranties hereunder,  (1)
the Offering is exempt from the registration requirements of the 1933 Act or any
applicable state "Blue Sky" law or (2) the Investor is an Accredited Investor.

                (vi) The Placement Agent is a member of the National Association
of Securities Dealers, Inc., and is a broker-dealer registered as such under the
1934 Act and under the  securities  laws of the  states in which the  Securities
will be offered or sold by the  Placement  Agent  unless an  exemption  for such
state  registration is available to the Placement  Agent. The Placement Agent is
in  compliance  with  all  material  rules  and  regulations  applicable  to the
Placement Agent generally and applicable to the Placement Agent's  participation
in the Offering.

         4. Representations and Warranties of the Company.
            ----------------------------------------------

            A.   The Company represents and warrants as follows:

                (i) The  execution,  delivery  and  performance  of each of this
Agreement,  the Equity Line of Credit Agreement,  the Escrow Agreement,  and the
Registration Rights Agreement has been or will be duly and validly authorized by
the Company and is, or with respect to this Agreement, the Equity Line of Credit
Agreement,  the Escrow Agreement, and the Registration Rights Agreement will be,
a valid and binding agreement of the Company, enforceable in accordance with its
respective  terms,  except to the extent that (a) the  enforceability  hereof or
thereof may be limited by bankruptcy, insolvency, reorganization,  moratorium or
similar laws from time to time in effect and  affecting  the rights of creditors
generally,  (b) the  enforceability  hereof or  thereof  is  subject  to general
principles of equity or (c) the indemnification provisions hereof or thereof may
be held to be in  violation  of  public  policy.  The  Securities  to be  issued
pursuant to the transactions  contemplated by this Agreement and the Equity Line
of Credit  Agreement have been duly  authorized and, when issued and paid for in
accordance  with  (x) this  Agreement,  the  Equity  Line of  Agreement  and the
certificates/instruments  representing  such  Securities,  (y) will be valid and
binding  obligations  of the  Company,  enforceable  in  accordance  with  their
respective terms,  except to the extent that (1) the enforceability  thereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
from time to time in effect and affecting the rights of creditors generally, and
(2) the  enforceability  thereof is subject to general principles of equity. All
corporate action required to be taken for the  authorization,  issuance and sale
of the Securities has been duly and validly taken by the Company.

                (ii) The Company has a duly  authorized,  issued and outstanding
capitalization  as set forth herein and in the Equity Line of Credit  Agreement.
The  Company is not a party to or bound by any  instrument,  agreement  or other
arrangement  providing  for it to issue any  capital  stock,  rights,  warrants,
options or other securities, except for this Agreement, the agreements described
herein and as described in the Equity Line of Credit  Agreement,  dated the date
hereof  and  the  agreements  described  therein.  All  issued  and  outstanding
securities of the Company,  have been duly authorized and validly issued and are
fully paid and non-assessable;  the holders thereof have no rights of rescission
or  preemptive  rights  with  respect  thereto  and are not  subject to personal
liability  solely  by  reason  of  being  security  holders;  and  none  of such
securities  were issued in violation of the preemptive  rights of any holders of
any security of the Company. As of the date hereof, the authorized capital stock
of the Company  consists of 12,5000,000  shares of Common Stock, par value $.001
per share of which ___________ shares of Common Stock are issued and outstanding
and 1,000,000 shares of Preferred Stock, none of which are outstanding.

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<PAGE>

                  (iii) The Common  Stock to be issued in  accordance  with this
Agreement and the Equity Line of Credit  Agreement has been duly  authorized and
when issued and paid for in accordance with this  Agreement,  the Equity Line of
Credit  Agreement  and the  certificates/instruments  representing  such  Common
Stock,  will be validly  issued,  fully-paid  and  non-assessable;  the  holders
thereof will not be subject to personal liability solely by reason of being such
holders;  such  Securities  are not and will not be  subject  to the  preemptive
rights of any holder of any security of the Company.

                (iv)  Except  as may be  set  forth  in  the  SEC  Documents  or
Attachment 4.12 to the Equity Line of Credit Agreement, the Company has good and
marketable title to, or valid and enforceable leasehold estates in, all items of
real and personal property necessary to conduct its business (including, without
limitation, any real or personal property stated in the Offering Materials to be
owned or leased by the  Company),  free and  clear of all  liens,  encumbrances,
claims, security interests and defects of any material nature whatsoever,  other
than those set forth in the Offering  Materials  and liens for taxes not yet due
and payable.  (v) There is no litigation or governmental  proceeding pending or,
to the best of the Company's  knowledge,  threatened  against,  or involving the
properties  or  business  of the  Company,  except as set forth in the  Offering
Materials.

                  (vi)  The  Company  has been  duly  organized  and is  validly
existing  as a  corporation  in good  standing  under  the laws of the  State of
Nevada. Except as set forth in the Offering Materials,  the Company does not own
or control,  directly  or  indirectly,  an  interest  in any other  corporation,
partnership,  trust, joint venture or other business entity. The Company is duly
qualified  or licensed  and in good  standing as a foreign  corporation  in each
jurisdiction   in  which  the   character  of  its   operations   requires  such
qualification or licensing and where failure to so qualify would have a material
adverse effect on the Company. The Company has all requisite corporate power and
authority,  and all material and necessary  authorizations,  approvals,  orders,
licenses,  certificates  and  permits  of and from all  governmental  regulatory
officials  and bodies  (domestic  and  foreign) to conduct its  businesses  (and
proposed  business) as described in the Offering  Materials.  Any disclosures in
the Offering  Materials  concerning the effects of foreign,  federal,  state and
local  regulation  on the  Company's  businesses  as currently  conducted and as
contemplated  are correct in all  material  respects  and do not omit to state a
material fact.  The Company has all corporate  power and authority to enter into
this Agreement,  the Equity Line of Credit  Agreement,  the Registration  Rights
Agreement,  and the Escrow Agreement, to carry out the provisions and conditions
hereof and  thereof,  and all  consents,  authorizations,  approvals  and orders
required in connection  herewith and therewith have been  obtained.  No consent,
authorization or order of, and no filing with, any court,  government  agency or
other body is  required by the Company  for the  issuance of the  Securities  or
execution and delivery of the Offering  Materials except for applicable  federal
and state  securities laws. The Company,  since its inception,  has not incurred
any  liability  arising  under or as a result of the  application  of any of the
provisions of the 1933 Act, the 1934 Act or the Rules and Regulations.
                  (vii)  There  has  been  no  material  adverse  change  in the
condition or prospects of the Company,  financial or otherwise,  from the latest
dates as of which such  condition or prospects,  respectively,  are set forth in
the Offering Materials,  and the outstanding debt, the property and the business
of the Company  conform in all  material  respects to the  descriptions  thereof
contained in the Offering Materials.

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<PAGE>

                (viii)  Except  as set  forth  in the  Offering  Materials,  the
Company is not in breach of, or in default  under,  any term or provision of any
material indenture, mortgage, deed of trust, lease, note, loan or Equity Line of
Credit  Agreement or any other  material  agreement or instrument  evidencing an
obligation for borrowed money, or any other material  agreement or instrument to
which  it is a party or by  which  it or any of its  properties  may be bound or
affected.  The Company is not in  violation  of any  provision of its charter or
by-laws or in violation of any franchise,  license, permit, judgment,  decree or
order, or in violation of any material statute, rule or regulation.  Neither the
execution  and delivery of the Offering  Materials  nor the issuance and sale or
delivery of the  Securities,  nor the  consummation  of any of the  transactions
contemplated  in the Offering  Materials nor the  compliance by the Company with
the terms and provisions hereof or thereof, has conflicted with or will conflict
with,  or has  resulted  in or will  result in a breach of, any of the terms and
provisions  of, or has  constituted or will  constitute a default under,  or has
resulted in or will result in the creation or imposition of any lien,  charge or
encumbrance  upon any property or assets of the Company or pursuant to the terms
of any indenture,  mortgage, deed of trust, note, loan or any other agreement or
instrument  evidencing an obligation for borrowed  money, or any other agreement
or  instrument to which the Company may be bound or to which any of the property
or assets of the Company is subject except (a) where such default,  lien, charge
or encumbrance  would not have a material  adverse effect on the Company and (b)
as  described  in the  Offering  Materials;  nor will such action  result in any
violation  of the  provisions  of the  charter or the by-laws of the Company or,
assuming  the  due  performance  by  the  Placement  Agent  of  its  obligations
hereunder,  any  material  statute or any  material  order,  rule or  regulation
applicable  to the  Company of any court or of any  foreign,  federal,  state or
other regulatory authority or other government body having jurisdiction over the
Company.

                (ix) Subsequent to the dates as of which information is given in
the Offering Materials, and except as may otherwise be indicated or contemplated
herein or therein and the securities offered pursuant to the Securities Purchase
Agreement  dated the date hereof,  the Company has not (a) issued any securities
or incurred any  liability or  obligation,  direct or  contingent,  for borrowed
money, or (b) entered into any transaction  other than in the ordinary course of
business, or (c) declared or paid any dividend or made any other distribution on
or in  respect  of its  capital  stock.  Except  as  described  in the  Offering
Materials, the Company has no outstanding obligations to any officer or director
of the Company.

                (x) There are no claims for services in the nature of a finder's
or  origination  fee with  respect to the sale of the Common  Stock or any other
arrangements, agreements or understandings that may affect the Placement Agent's
compensation,  as determined by the National  Association of Securities Dealers,
Inc.

                (xi)  Except  as may be set  forth  in the SEC  Documents  or an
attachment  to the  Equity  Line  of  Credit  Agreement,  the  Company  owns  or
possesses,  free and clear of all liens or  encumbrances  and rights  thereto or
therein by third  parties,  the  requisite  licenses or other  rights to use all
trademarks,  service marks,  copyrights,  service names,  trade names,  patents,
patent  applications and licenses necessary to conduct its business  (including,
without  limitation,  any such  licenses  or rights  described  in the  Offering
Materials as being owned or possessed by the Company)  and,  except as set forth
in the Offering Materials,  there is no claim or action by any person pertaining
to, or proceeding,  pending or threatened, which challenges the exclusive rights
of the  Company  with  respect to any  trademarks,  service  marks,  copyrights,
service names, trade names,  patents,  patent  applications and licenses used in
the conduct of the Company's businesses (including, without limitation, any such

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licenses  or  rights  described  in the  Offering  Materials  as being  owned or
possessed  by the  Company)  except  any claim or action  that  would not have a
material adverse effect on the Company; the Company's current products, services
or processes do not infringe or will not infringe on the patents  currently held
by any third party.

                (xii) Except as described in the Offering Materials, the Company
is not under any  obligation to pay royalties or fees of any kind  whatsoever to
any third  party with  respect to any  trademarks,  service  marks,  copyrights,
service names, trade names, patents, patent applications, licenses or technology
it has developed, uses, employs or intends to use or employ, other than to their
respective licensors.

                (xiii) Subject to the  performance by the Placement Agent of its
obligations  hereunder and the offer and sale of the Securities comply, and will
continue to comply in all material respects with the requirements of Rule 506 of
Regulation  D  promulgated  by the SEC  pursuant  to the 1933 Act and any  other
applicable  federal and state laws,  rules,  regulations  and executive  orders.
Neither the Offering  Materials nor any amendment or supplement  thereto nor any
documents  prepared by the Company in connection  with the Offering will contain
any untrue  statement  of a  material  fact or omit to state any  material  fact
required to be stated  therein or necessary to make the statements  therein,  in
light of the  circumstances  under  which they were made,  not  misleading.  All
statements of material  facts in the Offering  Materials are true and correct as
of the date of the Offering Materials.

                (xiv) All  material  taxes  which are due and  payable  from the
Company  have been  paid in full or  adequate  provision  has been made for such
taxes on the books of the Company  except for those taxes disputed in good faith
the Company does not have any tax  deficiency or claim  outstanding  assessed or
proposed against it.

                (xv) None of the  Company  nor any of its  officers,  directors,
employees or agents, nor any other person acting on behalf of the Company,  has,
directly  or  indirectly,  given or agreed to give any  money,  gift or  similar
benefit (other than legal price  concessions to customers in the ordinary course
of  business)  to any  customer,  supplier,  employee  or agent of a customer or
supplier,  or official or employee of any governmental agency or instrumentality
of any government  (domestic or foreign) or any political party or candidate for
office  (domestic  or foreign) or other person who is or may be in a position to
help or hinder the business of the Company (or assist it in connection  with any
actual or  proposed  transaction)  which (A) might  subject  the  Company to any
damage  or  penalty  in  any  civil,  criminal  or  governmental  litigation  or
proceeding, or (B) if not given in the past, might have had a materially adverse
effect on the assets,  business or operations of the Company as reflected in any
of the financial statements  contained in the Offering Materials,  or (C) if not
continued in the future, might adversely affect the assets, business, operations
or prospects of the Company in the future.

         5. Representations, Warranties and Covenants of the Investor.
            ----------------------------------------------------------
            A.  The Investor represents, warrants and covenants as follows:

                (i) The  Investor  has the  necessary  power to enter  into this
Agreement and to consummate the transactions contemplated hereby.

                (ii)  The  execution  and  delivery  by  the  Investor  of  this
Agreement and the consummation of the transactions  contemplated herein will not
result in any  violation  of, or be in conflict  with,  or  constitute a default
under,  any agreement or instrument to which the Investor is a party or by which
the Investor or its properties are bound, or any judgment,  decree, order or, to

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the  Investor's  knowledge,  any statute,  rule or regulation  applicable to the
Investor.  This  Agreement  when executed and  delivered by the  Investor,  will
constitute the legal, valid and binding obligations of the Investor, enforceable
in accordance  with their  respective  terms,  except to the extent that (a) the
enforceability  hereof or  thereof  may be limited  by  bankruptcy,  insolvency,
reorganization,  moratorium  or  similar  laws from  time to time in effect  and
affecting the rights of creditors  generally,  (b) the enforceability  hereof or
thereof is subject to general  principles of equity, or (c) the  indemnification
provisions hereof or thereof may be held to be in violation of public policy.

                (iii) The Investor will promptly  forward  copies of any and all
due diligence questionnaires compiled by the Investor to the Placement Agent.

         6. Certain Covenants and Agreements of the Company.
            ------------------------------------------------

         The Company covenants and agrees at its expense and without any expense
to the Placement Agent as follows:

         A. To advise the Placement Agent of any material  adverse change in the
Company's  financial  condition,  prospects  or business  or of any  development
materially  affecting the Company or rendering untrue or misleading any material
statement in the Offering Materials occurring at any time as soon as the Company
is either informed or becomes aware thereof.

         B. To use its commercially reasonable efforts to cause the Common Stock
issuable  in  connection  with the  Equity  Line of  Credit to be  qualified  or
registered for sale on terms  consistent  with those stated in the  Registration
Rights  Agreement and under the  securities  laws of such  jurisdictions  as the
Placement  Agent  and the  Investor  shall  reasonably  request.  Qualification,
registration  and  exemption  charges  and fees  shall  be at the sole  cost and
expense of the Company.

         C. Upon  written  request,  to provide  and  continue  to  provide  the
Placement  Agent and the Investor copies of all quarterly  financial  statements
and audited annual financial statements prepared by or on behalf of the Company,
other reports prepared by or on behalf of the Company for public  disclosure and
all documents delivered to the Company's stockholders.

         D. To deliver, during the registration period of the Equity Line Credit
Agreement,  to the Placement Agent upon the Placement  Agent's  request,  within
forty five (45) days, a statement of its income for each such quarterly  period,
and its balance sheet and a statement of changes in  stockholders'  equity as of
the end of such quarterly  period,  all in reasonable  detail,  certified by its
principal  financial or accounting  officer;  (ii) within ninety (90) days after
the close of each fiscal year,  its balance sheet as of the close of such fiscal
year,   together  with  a  statement  of  income,  a  statement  of  changes  in
stockholders'  equity and a statement  of cash flow for such fiscal  year,  such
balance sheet, statement of income, statement of changes in stockholders' equity
and statement of cash flow to be in reasonable  detail and accompanied by a copy
of the  certificate  or  report  thereon  of  independent  auditors  if  audited
financial  statements are prepared;  and (iii) a copy of all documents,  reports
and information  furnished to its  stockholders at the time that such documents,
reports and information are furnished to its stockholders.

         E.       To comply with the terms of the Offering Materials.

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<PAGE>

         F. To ensure that any transactions between or among the Company, or any
of its officers, directors and affiliates be on terms and conditions that are no
less  favorable  to the  Company,  than the terms and  conditions  that would be
available in an "arm's length" transaction with an independent third party.

         7. Indemnification.
            ----------------

         A.  The  Company  hereby  agrees  that it will  indemnify  and hold the
Placement   Agent  and  each  officer,   director,   shareholder,   employee  or
representative of the Placement Agent and each person controlling, controlled by
or under common  control with the Placement  Agent within the meaning of Section
15 of the  1933  Act or  Section  20 of the  1934  Act or the  SEC's  Rules  and
Regulations promulgated there under (the "Rules and Regulations"), harmless from
and  against  any  and all  loss,  claim,  damage,  liability,  cost or  expense
whatsoever (including, but not limited to, any and all reasonable legal fees and
other  expenses and  disbursements  incurred in connection  with  investigating,
preparing to defend or defending any action,  suit or proceeding,  including any
inquiry or investigation, commenced or threatened, or any claim whatsoever or in
appearing  or  preparing  for  appearance  as a witness in any  action,  suit or
proceeding,  including any inquiry, investigation or pretrial proceeding such as
a deposition)  to which the Placement  Agent or such  indemnified  person of the
Placement  Agent may become  subject under the 1933 Act, the 1934 Act, the Rules
and Regulations, or any other federal or state law or regulation,  common law or
otherwise,  arising  out of or based  upon (i) any untrue  statement  or alleged
untrue  statement  of a  material  fact  contained  in  (a)  Section  4 of  this
Agreement,  (b) the Offering Materials (except those written statements relating
to the Placement  Agent given by an indemnified  person for inclusion  therein),
(c) any application or other document or written  communication  executed by the
Company or based upon written information  furnished by the Company filed in any
jurisdiction  in order to qualify  the Common  Stock under the  securities  laws
thereof,  or any state  securities  commission  or agency;  (ii) the omission or
alleged omission from documents  described in clauses (a), (b) or (c) above of a
material fact required to be stated  therein or necessary to make the statements
therein not  misleading;  or (iii) the breach of any  representation,  warranty,
covenant or agreement made by the Company in this Agreement. The Company further
agrees that upon demand by an  indemnified  person,  at any time or from time to
time, it will promptly  reimburse such indemnified  person for any loss,  claim,
damage,  liability,  cost  or  expense  actually  and  reasonably  paid  by  the
indemnified  person as to which the Company has indemnified such person pursuant
hereto.  Notwithstanding  the foregoing  provisions of this Paragraph  6(A), any
such payment or reimbursement by the Company of fees,  expenses or disbursements
incurred by an indemnified person in any proceeding in which a final judgment by
a court of competent  jurisdiction  (after all appeals or the expiration of time
to appeal) is entered  against the Placement  Agent or such  indemnified  person
based upon specific finding of fact that the Placement Agent or such indemnified
person's gross negligence or willful  misfeasance will be promptly repaid to the
Company.

         B. The Placement  Agent hereby  agrees that it will  indemnify and hold
the Company and each officer, director, shareholder,  employee or representative
of the  Company,  and each person  controlling,  controlled  by or under  common
control  with the  Company  within the  meaning of Section 15 of the 1933 Act or
Section  20 of the 1934 Act or the  Rules  and  Regulations,  harmless  from and
against any and all loss, claim, damage,  liability,  cost or expense whatsoever
(including,  but not  limited  to, any and all  reasonable  legal fees and other
expenses and disbursements incurred in connection with investigating,  preparing
to defend or defending any action, suit or proceeding,  including any inquiry or
investigation,  commenced or threatened, or any claim whatsoever or in appearing

                                       8
<PAGE>

or preparing  for  appearance  as a witness in any action,  suit or  proceeding,
including  any  inquiry,   investigation  or  pretrial   proceeding  such  as  a
deposition) to which the Company or such  indemnified  person of the Company may
become subject under the 1933 Act, the 1934 Act, the Rules and  Regulations,  or
any other federal or state law or regulation,  common law or otherwise,  arising
out of or based upon (i) the  conduct of the  Placement  Agent or its  officers,
employees or  representatives  in its acting as Placement Agent for the Offering
or (ii)  the  material  breach  of any  representation,  warranty,  covenant  or
agreement  made by the  Placement  Agent in this  Agreement  (iii)  any false or
misleading  information  provided to the Company by one of the Placement Agent's
indemnified persons.

         C. The  Investor  hereby  agrees  that it will  indemnify  and hold the
Placement   Agent  and  each  officer,   director,   shareholder,   employee  or
representative of the Placement Agent, and each person  controlling,  controlled
by or under  common  control  with the  Placement  Agent  within the  meaning of
Section  15 of the 1933 Act or  Section  20 of the  1934  Act or the  Rules  and
Regulations,  harmless  from  and  against  any and  all  loss,  claim,  damage,
liability,  cost or expense whatsoever  (including,  but not limited to, any and
all  reasonable  legal fees and other  expenses  and  disbursements  incurred in
connection with investigating, preparing to defend or defending any action, suit
or proceeding, including any inquiry or investigation,  commenced or threatened,
or any claim whatsoever or in appearing or preparing for appearance as a witness
in any action,  suit or  proceeding,  including  any inquiry,  investigation  or
pretrial  proceeding  such as a deposition) to which the Placement Agent or such
indemnified person of the Placement Agent may become subject under the 1933 Act,
the 1934 Act, the Rules and  Regulations,  or any other  federal or state law or
regulation,  common  law or  otherwise,  arising  out of or  based  upon (i) the
conduct of the Investor or its  officers,  employees or  representatives  in its
acting as the  Investor  for the  Offering  or (ii) the  material  breach of any
representation,  warranty,  covenant or  agreement  made by the  Investor in the
Offering  Materials  (iii) any false or misleading  information  provided to the
Placement Agent by one of the Investor's indemnified persons.

         D. The Placement  Agent hereby  agrees that it will  indemnify and hold
the Investor and each officer, director, shareholder, employee or representative
of the  Investor,  and each person  controlling,  controlled  by or under common
control  with the  Investor  within the meaning of Section 15 of the 1933 Act or
Section  20 of the 1934 Act or the  Rules  and  Regulations,  harmless  from and
against any and all loss, claim, damage,  liability,  cost or expense whatsoever
(including,  but not  limited  to, any and all  reasonable  legal fees and other
expenses and disbursements incurred in connection with investigating,  preparing
to defend or defending any action, suit or proceeding,  including any inquiry or
investigation,  commenced or threatened, or any claim whatsoever or in appearing
or preparing  for  appearance  as a witness in any action,  suit or  proceeding,
including  any  inquiry,   investigation  or  pretrial   proceeding  such  as  a
deposition) to which the Investor or such indemnified person of the Investor may
become subject under the 1933 Act, the 1934 Act, the Rules and  Regulations,  or
any other federal or state law or regulation,  common law or otherwise,  arising
out of or based upon (i) the  conduct of the  Placement  Agent or its  officers,
employees  or  representatives  in its  acting  as the  Placement  Agent for the
Offering or (ii) the material breach of any representation,  warranty,  covenant
or agreement made by the Placement  Agent in this  Agreement  (iii) any false or
misleading  information provided to the Investor by one of the Placement Agent's
indemnified persons.

                                       9
<PAGE>

         E.  Promptly  after  receipt  by an  indemnified  party  of  notice  of
commencement  of any action covered by Section 6(A),  (B), (C) or (D), the party
to be indemnified shall,  within five (5) business days, notify the indemnifying
party of the commencement  thereof; the omission by one (1) indemnified party to
so notify the indemnifying party shall not relieve the indemnifying party of its
obligation to indemnify any other  indemnified  party that has given such notice
and shall not relieve the  indemnifying  party of any liability  outside of this
indemnification  if not  materially  prejudiced  thereby.  In the event that any
action is brought against the indemnified  party, the indemnifying party will be
entitled to participate  therein and, to the extent it may desire, to assume and
control  the  defense  thereof  with  counsel  chosen by it which is  reasonably
acceptable to the indemnified party. After notice from the indemnifying party to
such  indemnified  party of its election to so assume the defense  thereof,  the
indemnifying  party  will not be liable to such  indemnified  party  under  such
Section  6(A),  (B),  (C), or (D) for any legal or other  expenses  subsequently
incurred by such indemnified  party in connection with the defense thereof,  but
the  indemnified  party may, at its own expense,  participate in such defense by
counsel  chosen by it,  without,  however,  impairing the  indemnifying  party's
control  of  the  defense.   Subject  to  the  proviso  of  this   sentence  and
notwithstanding  any other  statement  to the  contrary  contained  herein,  the
indemnified  party or  parties  shall  have the right to choose its or their own
counsel  and  control  the  defense  of any  action,  all at the  expense of the
indemnifying  party if,  (i) the  employment  of such  counsel  shall  have been
authorized in writing by the  indemnifying  party in connection with the defense
of  such  action  at  the  expense  of  the  indemnifying  party,  or  (ii)  the
indemnifying  party shall not have employed counsel  reasonably  satisfactory to
such  indemnified  party to have charge of the  defense of such action  within a
reasonable  time  after  notice of  commencement  of the  action,  or (iii) such
indemnified  party or parties shall have reasonably  concluded that there may be
defenses available to it or them which are different from or additional to those
available  to one  or  all  of the  indemnifying  parties  (in  which  case  the
indemnifying  parties  shall not have the right to direct  the  defense  of such
action on behalf of the  indemnified  party or parties),  in any of which events
such  fees  and  expenses  of one  additional  counsel  shall  be  borne  by the
indemnifying party; provided, however, that the indemnifying party shall not, in
connection with any one action or separate but substantially  similar or related
actions in the same jurisdiction  arising out of the same general allegations or
circumstance,  be liable for the  reasonable  fees and expenses of more than one
separate  firm of attorneys  at any time for all such  indemnified  parties.  No
settlement of any action or  proceeding  against an  indemnified  party shall be
made without the consent of the indemnifying party.

         F.  In  order  to  provide  for  just  and  equitable  contribution  in
circumstances in which the indemnification  provided for in Section 6(A) or 6(B)
is due in accordance  with its terms but is for any reason held by a court to be
unavailable  on grounds of policy or  otherwise,  the Company and the  Placement
Agent shall contribute to the aggregate losses,  claims, damages and liabilities
(including  legal or other expenses  reasonably  incurred in connection with the
investigation  or defense of same) which the other may incur in such  proportion
so that the  Placement  Agent  shall be  responsible  for  such  percent  of the
aggregate of such losses,  claims,  damages and  liabilities  as shall equal the
percentage of the gross  proceeds  paid to the  Placement  Agent and the Company
shall be responsible for the balance;  provided,  however, that no person guilty
of fraudulent  misrepresentation within the meaning of Section 11(f) of the 1933
Act shall be entitled to contribution from any person who was not guilty of such
fraudulent  misrepresentation.  For  purposes of this Section  6(F),  any person

                                       10
<PAGE>

controlling,  controlled by or under common control with the Placement Agent, or
any partner,  director,  officer,  employee,  representative or any agent of any
thereof,  shall have the same rights to  contribution as the Placement Agent and
each person controlling,  controlled by or under common control with the Company
within  the  meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
and each officer of the Company and each  director of the Company shall have the
same rights to contribution  as the Company.  Any party entitled to contribution
will,  promptly after receipt of notice of commencement  of any action,  suit or
proceeding  against such party in respect of which a claim for  contribution may
be made against the other party under this Section 6(D),  notify such party from
whom contribution may be sought,  but the omission to so notify such party shall
not relieve the party from whom  contribution  may be sought from any obligation
they may have hereunder or otherwise if the party from whom  contribution may be
sought is not  materially  prejudiced  thereby.  The indemnity and  contribution
agreements  contained in this Section 6 shall remain operative and in full force
and  effect  regardless  of  any  investigation  made  by or on  behalf  of  any
indemnified person or any termination of this Agreement.

         8. Payment of Expenses.
            --------------------

         The Company  hereby  agrees to bear all of the  expenses in  connection
with the Offering,  including,  but not limited to the  following:  filing fees,
printing and duplicating  costs,  advertisements,  postage and mailing  expenses
with respect to the transmission of Offering  Materials,  registrar and transfer
agent fees, escrow agent fees as set forth in the Escrow Agreement,  fees of the
Company's counsel and accountants, issue and transfer taxes, if any.

         9. Conditions of Closing.
            ----------------------

         The  Closing  shall  be  held at the  offices  of the  Investor  or its
counsel.  The  obligations of the Placement  Agent hereunder shall be subject to
the  continuing  accuracy of the  representations  and warranties of the Company
herein as of the date hereof and as of the Date of Closing (the "Closing  Date")
with  respect to the  Company  as if it had been made on and as of such  Closing
Date;  the  accuracy  on and as of the  Closing  Date of the  statements  of the
officers  of the  Company  made  pursuant  to the  provisions  hereof;  and  the
performance  by the Company on and as of the Closing Date of its  covenants  and
obligations hereunder and to the following further conditions:

         A. Upon the  effectiveness  of a  registration  statement  covering the
Equity Line of Credit  Agreement,  the Placement Agent shall receive the opinion
of Counsel to the Company,  dated as of the date thereof, which opinion shall be
in form and substance reasonably satisfactory to the Investor, their counsel and
the Placement Agent.

         B. At or prior to the  Closing,  the  Placement  Agent  shall have been
furnished such documents, certificates and opinions as it may reasonably require
for the purpose of enabling them to review or pass upon the matters  referred to
in this  Agreement  and the  Offering  Materials,  or in order to  evidence  the
accuracy, completeness or satisfaction of any of the representations, warranties
or conditions herein contained.

         C. At and prior to the  Closing,  (i) there shall have been no material
adverse change nor development  involving a prospective  change in the condition
or prospects or the business activities,  financial or otherwise, of the Company
from the latest  dates as of which such  condition  is set forth in the Offering
Materials; (ii) there shall have been no transaction, not in the ordinary course
of  business  except  the  transactions  pursuant  to  the  Securities  Purchase
Agreement  entered  into by the  Company  which  has not been  disclosed  in the
Offering  Materials or to the  Placement  Agent in writing;  (iii) except as set
forth in the Offering  Materials,  the Company shall not be in default under any
provision of any instrument relating to any outstanding indebtedness for which a
waiver or extension has not been otherwise received; (iv) except as set forth in
the Offering Materials,  the Company shall not have issued any securities (other
than those to be issued as provided in the  Offering  Materials)  or declared or
paid any dividend or made any distribution of its capital stock of any class and
there shall not have been any change in the indebtedness (long or short term) or
liabilities or  obligations  of the Company  (contingent or otherwise) and trade
payable  debt;  (v) no material  amount of the assets of the Company  shall have
been pledged or mortgaged,  except as indicated in the Offering  Materials;  and
(v) no action, suit or proceeding,  at law or in equity,  against the Company or
affecting any of its  properties  or  businesses  shall be pending or threatened
before  or by  any  court  or  federal  or  state  commission,  board  or  other
administrative  agency,  domestic or foreign,  wherein an unfavorable  decision,
ruling or finding could materially adversely affect the businesses, prospects or
financial  condition  or  income  of the  Company,  except  as set  forth in the
Offering Materials.

                                       11
<PAGE>

         D. At Closing,  the Placement  Agent shall receive a certificate of the
Company signed by an executive officer and chief financial officer,  dated as of
the  applicable  Closing,  to the  effect  that  the  conditions  set  forth  in
subparagraph  (C) above  have been  satisfied  and  that,  as of the  applicable
closing,  the representations and warranties of the Company set forth herein are
true and correct.

         10. Termination.
             ------------

         This Agreement  shall be co-terminus  with, and terminate upon the same
terms and conditions as those set forth in, the Equity Line of Credit Agreement.
The  rights  of the  Investor  and the  obligations  of the  Company  under  the
Registration  Rights  Agreement,  and the rights of the Placement  Agent and the
obligations  of the Company  shall  survive the  termination  of this  Agreement
unabridged.

         11. Miscellaneous.
             --------------

         A. This Agreement may be executed in any number of  counterparts,  each
of which shall be deemed to be an original,  but all which shall be deemed to be
one and the same instrument.

         B. Any notice  required or  permitted  to be given  hereunder  shall be
given in writing  and shall be deemed  effective  when  deposited  in the United
States mail, postage prepaid, or when received if personally  delivered or faxed
(upon  confirmation  of receipt  received by the sending  party),  addressed  as
follows:

                                       12
<PAGE>

If to Placement Agent, to:      Westrock Advisors, Inc.
                                230 Park Avenue, Floor 9
                                New York, New York 10169

If to the Company, to:          Videolocity International Inc.
                                1762 - A Propsector Drive
                                Park City, Utah 84060
                                Attention:  Robert E. Holt
                                                  President and C.E.O.
                                Telephone: (619) 890-8186 or (801) 521-2807
                                Facsimile:  (801) 521-2844

With a copy to:                 Kirkpatrick & Lockhart, LLP
                                Miami Center - 20th Floor
                                201 South Biscayne Boulevard
                                Miami, FL 33131-2399
                                Attention: Clayton E. Parker, Esq.
                                Telephone: (305) 539-3306
                                Facsimile: (305) 358-7095

If to the Investor:             Cornell Capital Partners, LP
                                101 Hudson Street - Suite 3606
                                Jersey City, NJ 07302
                                Attention: Mark A. Angelo
                                Portfolio Manager
                                Telephone: (201) 985-8300
                                Facsimile: (201) 985-8266

With Copies to:                 Butler Gonzalez LLP
                                1000 Stuyvesat Aveneue _ Suite No.: 6
                                Union, NJ 07083
                                Attention: David Gonzalez, Esq.
                                Telephone: (908) 810-8588
                                Facsimile: (908) 810-0973
or to such other address of which written notice is given to the others.

<PAGE>

         C. This  Agreement  shall be governed by and  construed in all respects
under the laws of the State of New York,  without  reference  to its conflict of
laws rules or principles. .

         D. This Agreement and the other  agreements  referenced  herein contain
the entire  understanding  between the parties hereto and may not be modified or
amended except by a writing duly signed by the party against whom enforcement of
the modification or amendment is sought.

                                       13
<PAGE>

         E. If any  provision of this  Agreement  shall be held to be invalid or
unenforceable,  such invalidity or  unenforceability  shall not affect any other
provision of this Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       14
<PAGE>

         IN WITNESS WHEREOF,  the parties hereto have executed this Agreement as
of the date first written above.

                             COMPANY:
                                                 VIDEOLOCITY INTERNATIONAL INC.

                                                 By:____________________________
                                                 Name:      Robert E. Holt
                                                 Title:     President and C.E.O.

                                                 PLACEMENT AGENT:
                                                 WESTROCK ADVISORS, INC.

                                                 By:____________________________
                                                 Name:
                                                 Title:

                                                 INVESTOR:
                                                 CORNELL CAPITAL PARTNERS, LP

                                                 By: Yorkville Advisors, LLC
                                                 Its: General Partner

                                                 By:____________________________
                                                 Name: Mark A. Angelo
                                                 Title: Portfolio Manager

                                       15
<PAGE>EMPLOYMENT AGREEMENT

         THIS  EMPLOYMENT  AGREEMENT (the  "Agreement") is entered into this 4th
day of August, 2002, by and between Videolocity, Inc., a Nevada corporation (the
"Company") and Cortney Taylor (the "Employee") and will become effective the 1st
day of September 2002.

                                    PREMISES

         A. The Company desires to employ  Employee and the Employee  desires to
accept employment in with the Company.

         B. The  parties  desire to enter  into  this  Employment  Agreement  to
specify each party's rights and obligations under the employment relationship.

                                   AGREEMENT

         NOW,  THEREFORE,  FOR  AND IN  CONSIDERATION  of the  mutual  covenants
contained  herein and the mutual benefits to be derived  hereunder,  the parties
agree as follows:

         1.  Employment.  The company hereby employs Employee as Chief Financial
Officer of the Company, its parent and other subsidiaries,  and Employee accepts
and agrees to such  employment,  on the terms and  conditions  set forth in this
Agreement.

         2. Term.  The term of this  Agreement  shall be for three (3) years and
commence  effective as of September 1, 2002,  and expire at midnight on the last
day of August 2005, unless earlier  terminated in accordance with the provisions
of this Agreement.

         3. Duties.  Employee  shall perform the duties  assigned to Employee by
the parent Company's Executive Committee (the "Executive  Committee") and or the
parents Board of Directors (the "Board") from time to time.  Employee shall hold
such offices and serve in such  positions  with the Company,  its parent  and/or
other  subsidiaries  as shall from time to time be requested  by the  "Executive
Committee"  and or the  "Board."  Employee  shall  not  receive  any  additional
compensation for service as an officer of the parent or its other  subsidiaries,
of the company unless as otherwise established by the "Board."

         Employee shall devote substantially all of his working time and efforts
to the  business of Company and its parent or other  subsidiaries  and shall not
during the term of this Agreement be engaged in any other  substantial  business
activities  which will interfere or conflict with the reasonable  performance of
his duties hereunder,  except where approved by the "Executive Committee" and or
the "Board." Employee may serve or continue to serve as a member of the board of
directors of any companies or organizations which, in the reasonable judgment of
the  Company's  "Executive  Committee"  or the  "Board,"  will not  present  any
conflict  of  interest  with  the  company,  its  parent  or any  of  its  other
subsidiaries  which  could  materially   adversely  affect  the  performance  of
Employee's duties under this Agreement.

        4.  Compensation

         (a) Base Salary.  For all services rendered by Employee,  Company shall
pay to Employee a base salary of $90,000.00 per year throughout the term of this
Agreement,  payable in arrears in two equal monthly installments on or about the
first and sixteenth day of each calendar  month.  All salary  payments  shall be
subject to withholding and other  applicable  taxes.  Employee's  salary for any
partial month at the beginning or end of this Agreement  shall be prorated.  The
rate of salary may be increased (but not decreased) at any time as the Board may
determine, based on earnings, increased activities of the Company, or such other
factors as the Board may deem  appropriate.  The Board shall  review  Employee's
base salary on not less than an annual basis.

                                       1
<PAGE>
         (b) Participation in Stock Incentive  Program.  The Company shall grant
Employee  40,000 plan units under the  Videolocity,  Inc.  2000 Stock  Incentive
Program  (the "Stock  Incentive  Program")  pursuant to which  Employee  will be
awarded one share of the Company's common stock for each fully vested plan unit,
as more particularly  described in the Stock Incentive  Program, a copy of which
has been delivered to Employee.

         (c) Employee Benefits.  The Company shall  provide such health and
medical insurance for Employee in the form and program chosen by the Company for
its full-time employees.  Employee shall be entitled to participate in any other
health, medical,  retirement,  pension,  profit-sharing,  disability,  death and
dismemberment,  life insurance,  stock option,  vacation and other benefit plans
and programs as in effect from time to time on the same basis as other similarly
situated employees of the Company.

         (d) Vacation. Employee shall be entitled to paid vacation in accordance
with the most favorable plans,  policies,  programs and practices of the Company
and its affiliated companies with respect to similarly situated employees of the
Company. Employee shall initially be entitled to two (2) weeks paid vacation per
calendar year, after one year of employment.

         5. Reimbursement of Expenses.  Company will promptly reimburse Employee
for  expenses  reasonably  incurred in  connection  with  Company's  business in
accordance with the Company's policies,  including expenses for travel, lodging,
meals, and other items on Employee's periodic  presentation of an expense report
in the form approved by the Company.

         6. Working  Facilities.  Company shall provide to Employee  offices and
facilities  appropriate to Employee's  position and suitable for the performance
of Employee's duties.

         7.  Nondisclosure  of  Confidential  Information.  For purposes of this
Agreement,  the term "Confidential  Information" means information (i) disclosed
to or known by Employee as a consequence of or through  his/her  employment with
the Company,  (ii) not  generally  known  outside the  Company,  and (iii) which
relates to the Company's business. Confidential Information includes, but is not
limited to,  information of a technical  nature,  such as methods and materials,
trade secrets, inventions,  processes,  formulas, systems, computer programs and
studies,  and  information of a business  nature such as project  plans,  market
information,  costs, customer lists, and so forth. Confidential information does
not include information that (i) is or becomes generally available to the public
other  than as a  result  of a  disclosure  by  Employee  in  violation  of this
Agreement, or (ii) was in Employee's possession prior to his introduction to the
Company.

         Recognizing  that the Company is presently  engaged,  and may hereafter
continue to be engaged,  in the research and  development  of processes  and the
performance of services which involve  experimental and inventive work, and that
the success of the  Company's  business  may depend upon the  protection  of its
processes,  products  and  services by patent,  copyright  or secrecy,  and that
Employee  has had, or during the course of his  engagement  may have,  access to
Confidential  Information,  as herein defined,  Employee agrees and acknowledges
that:

         (a) The  Company  has  exclusive  right and  title to all  Confidential
Informaiton and Employee hereby assigns all rights he might otherwise possess in
any  Confidential  Information  to  the  Company.  Except  as  required  in  the
performance  of his duties to the Company,  Employee will not at any time during
or after the term of his  employment or  engagement  by the Company,  which term
shall  include  any time in which  Employee  may be retained by the Company as a
consultant directly or indirectly use, communicate,  disclose or disseminate any
Confidential Information.

         (a) All documents,  records,  notebooks,  notes,  memoranda and similar
repositories of, or containing Confidential Information or any other information
of a secret, proprietary,  confidential or generally undisclosed nature relating
to the Company or its operations and activities  made or compiled by Employee at
any  time or  made  available  to him  during  the  term  of his  employment  or
engagement by the Company,  including any and all copies  thereof,  shall be the
property of the Company, shall be held by him in trust solely for the benefit of

                                       2
<PAGE>

the Company,  and shall be delivered to the Company by him on the termination of
his engagement or at any other time on the request of the Company.

         (c)  Employee  will  not  assert  any  rights  under  any   inventions,
trademarks, copyrights, discoveries, concepts or ideas, or improvements thereof,
or know-how related  thereto,  as having been made or acquired by him during the
term of his  employment  or  engagement  if based  on or  otherwise  related  to
Confidential Information.

8.  Assignment of Inventions

         (a) All discoveries,  concepts, and ideas, whether or not patentable or
subject to  copyright  protection,  including  but not limited to  improvements,
know-how,  data,  processes,  methods,  formulae,  and  techniques,  as  well as
improvements thereof, or know-how related thereto,  concerning any past, present
or  prospective  activities of the Company which  Employee  makes,  discovers or
conceives  (whether or not during the hours of his engagement or with the use of
the Company's facilities, materials or personnel), either solely or jointly with
others during his engagement by the Company or any affiliate and, if based on or
related  to  Confidential  Information,  at any time after  termination  of such
engagement (collectively,  the "Inventions"),  shall be the sole property of the
Company,  and Employee  agrees to perform the  provisions of this Section 8 with
respect  thereto  without  the  payment  by the  Company  of any  royalty or any
consideration  therefore other than the regular compensation paid to Employee in
his capacity as an employee or consultant.

         (b) Any  written  notebooks  maintained  by  Employee  with  respect to
Inventions and studies or research  projects  undertaken on the Company's behalf
shall at all times be the property of the Company and shall be  surrendered  to
the Company upon  termination  of Employee's  engagement or, upon the request of
the Company, at any time prior thereto.

         (c)  Employee  hereby  assigns  to the  Company  all of his  rights  to
invention.

         (d)  Employee  shall  sign,  acknowledge  and  deliver  promptly to the
Company,  without  charge  to the  Company,  but at its  expense,  such  written
instruments  (including  applications and assignments) and take such other acts,
such as giving  testimony  in  support  of  Employee's  inventorship,  as may be
necessary in the reasonable opinion of the Company to obtain, maintain,  extend,
reissue and enforce United States and/or  foreign  letters patent and copyrights
relating to  Inventions  invented by Employee  and to vest the entire  right and
title thereto in the Company or its nominee.  Employee  acknowledges  and agrees
that any copyright  developed or conceived of by Employee during the term of his
employment,  which is related to the business of the  Company,  shall be a "work
for hire"  under the  copyright  law of the United  States and other  applicable
jurisdiction.

         (e) Any  written  notebooks  maintained  by  Employee  with  respect to
Inventions and studies or research  projects  undertaken on the Company's behalf
shall at all times be the property of the Company and shall be  surrendered  to
the Company upon  termination  of Employee's  engagement or, upon the request of
the Company, at any time prior thereto.

         (f) Employee  represents  that his performance of all the terms of this
Agreement  and as an employee of or  consultant to the Company does not and will
not breach any trust or contract  entered  into prior to his  employment  by the
Company.  Employee agrees not to enter into any agreement either written or oral
in conflict  herewith and represents and agrees that he has not brought and will
not  bring  with  him  to  the  Company  or  use  in  the   performance  of  his
responsibilities at the Company any materials or documents of a former  employer
which are not generally available to the public,  unless he has obtained written
authorization from the former employer for their possession and use and provided
a copy of such authorization to the Company.

         9. Shop Rights.  The Company shall also have the royalty-free  right to
use in its  business  and to  make,  use and  sell  products,  processes  and/or
services derived from any inventions,  discoveries,  concepts and ideas, whether
or not patentable, including but not limited to processes, methods, discoveries,
concepts  and ideas,  whether or not  patentable,  including  but not limited to
processes, methods,  formulas and techniques, as well as improvements thereof or
know-how  related  thereto,  which are not  within  the scope of  Inventions  as
defined above but which are  conceived of or made by Employee  during the period

                                       3
<PAGE>

he is employed or engaged by the  Company or with the use or  assistance  of the
Company's facilities, materials, or personnel.

         10.  Non-Compete.  Employee  hereby agrees that during the term of this
Agreement  and  for a  period  of two  years  from  the  expiration  or  earlier
termination thereof, Employee will not:

         (a) Own, manage,  operate, or control any business that provides video,
audio, or other content to end users over telephone,  cable or similar lines, or
by wireless transmission ("video-on-demand"),  in any geographic marketing which
the  Company  or  any  subsidiary  thereof  is  then  providing  video-on-demand
services, or in any geographic market in which the Company has established plans
to  provide  video-on-demand  services  within  six  months  from  the  date the
determination  is being  made.  For  purposes  of this  paragraph  ownership  of
securities of not in excess of five percent (5%) of any class of securities of a
public company listed on the OTC Bulletin Board, a national securities exchange,
or on the National  Association of Securities Dealers Automated Quotation System
(NASDAQ)  shall not be  considered  to be  competition  with the  Company or any
subsidiary thereof;

         (b)  Provide  services  in the  video-on-demand  industry,  directly or
indirectly, as an officer, director, executive,  consultant,  employee, or agent
of any  company in any  geographic  market in ;which  the  Company or any of its
subsidiaries is then providing  video-on-demand  services,  or in any geographic
market in which the Company  has  established  plans to provide  video-on-demand
services within six months from the date for  determination  is being made. This
paragraph  shall not be construed to prevent  Employee from being  employed by a
subsidiary or division of a large  corporation which subsidiary or division does
not  conduct  business  in the video  services  industry,  even  though  another
subsidiary or division of that  corporation may be engaged in the video services
industry, as long as proper steps are taken to insure that Employee will have no
involvement,   input   or   oversight   with   respect   to  the   corporation's
video-on-demand operations.

         (c)   Solicit  any   video-on-demand   business   from,   or  sell  any
video-on-demand  products or services  to, any company  that was within one year
prior to the date of termination of Employee's employment, a customer, client or
associate of the Company or any of its subsidiaries.

         (d) Solicit the  employment of any full-time  employee  employed by the
Company or its subsidiaries as of the date of termination of this Agreement.

         Provided, however, that this Section 10 shall be void and of no further
force or effect in the event this Agreement is terminated by the Company without
Cause  or by  Employee  for  Good  Reason,  as  defined  in  Section  11 of this
Agreement.

         11. Termination

         (a) Death. The Employee's employment shall terminate automatically upon
the Employee's death during the term of this Agreement.

         (b)  Disability.  If Employee is absent from his full-time  duties with
the  Company  as a result  of  incapacity  due to  mental  or  physical  illness
("Disability") and such absence continues  uninterrupted for a period of one (1)
month, the base salary payable to Employee under this Agreement shall be reduced
by 50% until such time as Employee  resumes  the  performance  of his  full-time
duties  with  the  Company  or  this  Agreement  is  terminated.  If  Employee's
Disability  continues for two (2) consecutive  months, the Company may terminate
Employee's  employment  effective on the 30th day after receipt by Employee of a
notice to that effect  (the  "Disability  Termination  Date"),  unless  Employee
returns  to the  full-time  performance  of his duties  prior to the  Disability
Termination Date.

         (c) Cause. The Company may terminate  Employee's  employment during the
term of this Agreement for Cause. For purposes of this Agreement,  "Cause" shall
mean: (i) Employee being  convicted of a felony;  (ii) a willful act of personal
dishonesty  taken by  Employee in  connection  with his  responsibilities  as an
employee and intended to result  in substantial personal enrichment of employee;

                                       4
<PAGE>

(iii) the willful and continued failure of the Employee to perform substantially
the Employee's  duties with the Company or its  affiliates  (other than any such
failure  resulting  from  Disability),  after a written  demand for  substantial
performance  is  delivered  to the  Employee  by the  Board  which  specifically
identifies the manner in which the Board believes Employee has not substantially
performed Employee's duties and Employee has not performed such duties within 30
days of such  notice,  or (iv) the willful  engaging by the  Employee in illegal
conduct or gross misconduct  which is materially and  demonstrably  injurious to
the Company.  For purposes of this  provision,  no act or failure to act, on the
part of the  Employee,  shall be  considered  "willful"  unless  it is done,  or
omitted to be done,  by the Employee in bad faith or without  reasonable  belief
that the Employee's action or omission was in the best interests of the Company.
Any act,  or  failure  to act,  based  upon  authority  given  by the  Executive
Committee  and or Board of  Directors  of the parent  Company or  pursuant  to a
resolution duly adopted by the Board shall be conclusively  presumed to be done,
or omitted to be done,  by the Employee in good faith and in the best  interests
of the Company.

         (d)  Good  Reason.   The  Employee's   employment  may  be  voluntarily
terminated  by Employee at any time within sixty (60) days after the  occurrence
of an event  constituting  Good Reason.  For purposes of this  Agreement,  "Good
Reason" shall mean:

         (i) the failure by the Company to comply with any of the material terms
         of this Agreement, other an  isolated,  insubstantial and inadvertent
         failure not occurring in bad faith and which is remedied by the Company
         promptly after receipt of notice thereof by the Employee;

         (ii) the  relocation of Employee to any office or location more than 35
         miles from the location of the Company's offices at the commencement of
         this Agreement; or

         (iii) the occurrence of a Change in Control as defined in Section 13 of
         this Agreement.

         (e) Notice of Termination.  Any termination by the Company for Cause or
by the Employee for Good Reason,  shall be communicated by Notice of Termination
to the other party hereto in accordance with Section 17 of this  Agreement.  For
purposes of this  Agreement,  a "Notice of  Termination"  means a written notice
which (i) indicates the specific termination  provision in this Agreement relied
upon, (ii) to the extent  applicable,  sets forth in reasonable detail the facts
and  circumstances  claimed to provide a basis for termination of the Employee's
employment  under  the  provisions  so  indicated  and  (iii)  if  the  Date  of
Termination (as defined below) is other than the date of receipt of such notice,
specifies  the  termination  date (which date shall be not more than thirty days
after the giving of such notice).  The failure by the Employee or the Company to
set  forth  in  the  Notice  of  Termination  any  fact  or  circumstance  which
contributes  to a showing of Good  Reason or Cause  shall not waive any right of
the  Employee or the  Company,  respectively,  or preclude  the  Employee or the
Company,  respectively,  from asserting such fact or  circumstances in enforcing
the Employee's or the Company's rights hereunder.

         (f)  Date  of  Termination.  "Date  of  Termination"  means  (i) if the
Employee's employment is terminated by the Company for Cause, or by the Employee
for Good Reason,  the date of receipt of the Notice of  Termination or any later
date specified therein, as the case may be, (ii) if the Employee's employment is
terminated by the Company other than for Cause or Disability, or by the Employee
other than for Good Reason,  the Date of  Termination  shall be thirty (30) days
after the date on which the  Company  notifies  the  Employee,  or the  Employee
notifies the Company, of such termination and (iii) if the Employee's employment
is terminated by reason of death or Disability, the Date of Termination shall be
the  date of  death of the  Employee  or the  Disability  Termination  Date,  as
applicable.

        12.  Obligation of the Company upon Termination.

         (a)  Termination  for Good  Reason;  Termination  other Than for Cause,
Death or Disability.  If, during the term of this  Agreement,  the Company shall
terminate the  Employee's  employment  other than for Cause or Disability or the
Employee shall terminate employment for Good Reason:

                                       5
<PAGE>

         (i) The Company  shall pay to the Employee in a lump sum in cash within
         30 days after the Date of  Termination  the  aggregate of the following
         amounts:

                  A. The sum of (aa) the  Employee's  Annual Base Salary through
                  the Date of  Termination to the extent not  theretofore  paid,
                  (bb)   reimbursement  for  any  and  all  monies  advanced  in
                  connection  with  Employee's  employment  through  the Date of
                  Termination, and (cc) all other payments and benefits to which
                  Employee  may be entitled  under the terms of any benefit plan
                  of the Company through the Date of termination  (collectively,
                  the "Accrued  Obligations").  Where applicable,  such payments
                  shall be  prorated  based on a 360 day year and the  number of
                  days elapsed during the year in question.

                  B.  For  six  (6)  months   after  the   Employee's   Date  of
                  Termination,  the Company shall at  its expense provide health
                  and medical  insurance  to Employee and his family of the same
                  type  and  scope  as was  provided  during  the  term  of this
                  Agreement.

                  C. to the extent not theretofore paid or provided, the Company
                  shall timely pay or provide to the Employee any other  amounts
                  or  benefits  required  to be paid or  provided  or which  the
                  Employee  is  eligible  to  receive  under any plan,  program,
                  policy or practice or contract or agreement of the Company and
                  its affiliated companies through the Date of Termination (such
                  other amounts and benefits shall be hereinafter referred to as
                  the "Other Benefits").

         (ii) All  unvested  plan units of  Employee  under the Stock  Incentive
         Program  shall  vest  and the  Company  shall,  within  ten  (10)  days
         following the Date of Termination deliver to Employee the shares of the
         Company's common stock issuable upon the conversion of such plan units.

         (b) Death. If the Employee's  employment is terminated by reason of the
Employer's  death during the Employment  Period,  this Agreement shall terminate
without further obligations to the Employee's legal  representatives  under this
Agreement,  other than for payment of Accrued Obligations and the timely payment
or  provision  of  Other  Benefits.  Accrued  Obligations  shall  be paid to the
Employee  in a lump sum in cash  within 30 days of the Date of  Termination  and
Other Benefits shall be paid as soon as practicable in accordance  with the most
favorable  practices,  policies  and  procedures  followed by the  Company  with
respect to members of senior management. In addition, all unvested plan units of
Employee  under the Stock  Incentive  Program shall vest and the Company  shall,
within ten (10) days following the Date of  Termination  deliver to Employee the
shares of the Company's  common stock  issuable upon the conversion of such plan
units.

         (c) Disability. If the Employee's employment is terminated by reason of
the  Employee's  Disability  during the term of this  Agreement,  this Agreement
shall  terminate  without  further  obligations to the Employee,  other than for
payment of Accrued  Obligations  and the timely  payment or  provision  of Other
Benefits.  Accrued  Obligations  shall be paid to the  Employee in a lump sum in
cash within 30 days of the Date of Termination  and Other Benefits shall be paid
as soon as practicable in accordance with the most favorable practices, policies
and  procedures  followed  by the  Company  with  respect  to  members of senior
management.  In addition,  all unvested  plan units of Employee  under the Stock
Incentive  Program  shall  vest and the  Company  shall,  within  ten (10)  days
following  the  Date of  Termination  deliver  to  Employee  the  shares  of the
Company's common stock issuable upon the conversion of such plan units.

         (d) Cause:  Other than for Good Reason.  If the  Employee's  employment
shall be terminated for Cause during the term of this  Agreement, this Agreement
shall  terminate  without  further  obligations  to the Employee  other than for
payment of Accrued  Obligations  and the timely  payment or  provision  of Other
Benefits.   If  the  Employee  voluntarily   terminates  employment  during  the

                                       6
<PAGE>

Employment Period, excluding a termination for Good Reason, this Agreement shall
terminate  without further  obligations to the Employee,  other than for Accrued
Obligations  and the timely  payment or provision of Other  Benefits.  in either
event,  all Accrued  Obligations  shall be paid to the Employee in a lump sum in
cash within 30 days of the Date of  Termination  and all unvested plan units of
Employee under the Stock Incentive Program shall be forfeited.

         13. Change of Control.  A Change of Control (as defined  below),  shall
constitute  Good Reason as defined in Section 11(d) of this  Agreement and shall
entitle Employee to voluntarily terminate this Agreement in the manner described
in Section  11(d) above and to receive the  benefits  provided in Section  12(a)
above.

For purposes of this Agreement, "Change of Control" shall mean:

                  (i) The acquisition by any individual, entity or group (within
                  the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
                  Exchange Act of  1934,  as  amended  (the  "Exchange  Act") (a
                  "Person") of beneficial  ownership (within the meaning of Rule
                  13-d3  promulgated  under the Exchange  Act) of 20% or more of
                  either (aa) the then outstanding shares of common stock of the
                  Company (the  "Outstanding  Company Common Stock") or (bb) the
                  combined   voting  power  of  the  then   outstanding   voting
                  securities  of the Company  entitled to vote  generally in the
                  election  of  directors  (the   "Outstanding   Company  Voting
                  Securities");  provided,  however,  that for  purposes of this
                  Agreement,  the following  acquisitions shall not constitute a
                  Change of  Control:  (aa) any  acquisition  directly  from the
                  Company,  (bb)  any  acquisition  by  the  Company,  (cc)  any
                  acquisition  by any employee  benefit plan (or related  trust)
                  sponsored  or  maintained  by the  Company or any  corporation
                  controlled  by the  Company  or (dd)  any  acquisition  by any
                  corporation  pursuant to a  transaction  which  complies  with
                  clauses (aa), (bb) and (cc) of subsection (iii) below.

                  (ii) (aa) Individuals  who, as of the date hereof,  constitute
                  the Board  (the  "Incumbent  Board")  cease for any  reason to
                  constitute  at  least  a  majority  of  the  Board;  provided,
                  however,  that any individual  becoming  a director subsequent
                  to the date hereof whose election,  or nomination for election
                  by the  Company's  shareholders,  was approved by a vote of at
                  least  a  majority  of  the  directors  then   comprising  the
                  Incumbent  Board shall be considered as though such individual
                  were a member of the Incumbent Board, but excluding,  for this
                  purpose,  any such  individual  whose  initial  assumption  of
                  office occurs as a result of an actual or threatened  election
                  contest  with  respect to the election or removal of directors
                  or other actual  or  threatened  solicitation  of  proxies  or
                  consents  by or on behalf of a Person  other than the Board or
                  (bb) a  majority  of the  members  of the  Board  ceases to be
                  comprised of Directors whose most recent election to the Board
                  was  approved  by at least a majority of the  Incumbent  Board
                  prior to such election; or

                  (iii)   Consummation   of   a   reorganization,    merger   or
                  consolidation   or  sale  or  other   disposition  of  all  or
                  substantially  all of the assets of the  Company (a  "Business
                  Combination"),  in each case, unless,  following such Business
                  Combination,  (aa) all or substantially all of the individuals
                  and entities who were the beneficial owners, respectively,  of
                  the Outstanding  Company ]Common Stock and Outstanding Company
                  Voting   Securities   immediately   prior  to  such   Business
                  Combination  beneficially  own, directly or  indirectly,  more
                  than 50% of,  respectively,  the then  outstanding  shares  of
                  common  stock  and  the  combined  voting  power  of the  then
                  outstanding  voting  securities  entitled to vote generally in
                  the  election  of  directors,  as  the  case  may  be,  of the
                  corporation   resulting   from   such   Business   Combination
                  (including,  without  limitation,  a  corporation  which  as a
                  result  of  such  transaction  owns  the  Company  or  all  or
                  substantially  all of the Company's  assets either directly or
                  through one or more  subsidiaries) in  substantially  the same
                  proportions  as  their  ownership,  immediately  prior to such
                  Business  Combination of the Outstanding  Company Common Stock

                                       7
<PAGE>

                  and Outstanding Company Voting Securities, as the case may be,
                  (bb) no Person (excluding any corporation  resulting from such
                  Business  Combination or any employee benefit plan (or related
                  trust) of the Company or such corporation  resulting from such
                  Business   Combination)   beneficially   owns,   directly   or
                  indirectly, 20% or more of, respectively, the then outstanding
                  shares of common stock of the corporation  resulting from such
                  Business  Combination or the combined voting power of the then
                  outstanding  voting  securities of such corporation  except to
                  the extent that such  ownership  existed prior to the Business
                  Combination and (cc) at least a majority of the members of the
                  board of  directors  of the  corporation  resulting  from such
                  Business  Combination  were members of the Incumbent  Board at
                  the time of the execution of the initial agreement,  or of the
                  action of the Board,  providing for such Business Combination;
                  or

                  (iv) Approval by the shareholders of the Company of a complete
                  liquidation or dissolution of the Company.

         14. Nontransferability. Neither Employee, Employee's spouse, Employee's
designated  contingent  beneficiary,  nor their  estates shall have any right to
anticipate,  encumber, or dispose of any payment due under this Agreement.  Such
payments   and  other   rights  are   expressly   declared   nonassignable   and
nontransferable except as specifically provided herein.

         15. Indemnification. Company shall indemnify Employee and hold Employee
harmless from liability for acts or decisions made by Employee while  performing
services for Company to the  greatest  extent  permitted  by the Nevada  Revised
Statutes and shall advance funds to Employee for the defense of any action, suit
or proceeding prior to the conclusion thereof to the maximum extent permitted by
the Nevada Revised Statutes.

         16.  Assignment.  This  Agreement  may not be assigned by either  party
without the prior written consent of the other party.

         17. Notice. Any notices or other  communications  required or permitted
hereunder  shall be  sufficiently  given  if  personally  delivered,  if sent by
facsimile or telecopy transmission or other electronic  communication  confirmed
by  registered  or  certified  mail,  postage  prepaid,  or if sent  by  prepaid
overnight courier addresses as follows.

        If to Employee, to:             Cortney Taylor

        If to the Company, to:          Videolocity, Inc.
                                        ATTN: Chief Executive Officer
                                        358 S. 700 E. Suite B-604
                                        Salt Lake City, Utah  84104

         18. Entire  Agreement.  This Agreement is and shall be considered to be
the only agreement or  understanding  between the parties hereto with respect to
the  employment  of Employee by Company.  All  negotiations,  commitments,  and
understandings  acceptable  to both parties have been  incorporated  herein.  No
letter,  telegram,  or communication passing between the parties hereto covering
any matter  during this  contract  period,  or any plans or periods  thereafter,
shall be  deemed a a part of this Agreement;  nor  shall  it have the effect  of
modifying or adding to this  Agreement  unless it is  distinctly  stated in such
letter,  telegram,  or  communication  that it is to  constitute  a part of this
Agreement and is attached as an amendment to this Agreement and is signed by the
parties to this Agreement.

         19.  Enforcement.  Each of the  parties  to  this  Agreement  shall  be
entitled to any  remedies  available in equity or by statute with respect to the
breach  of the  terms of this  Agreement  by the other  party.  Employee  hereby

                                       8
<PAGE>

specifically acknowledges and agrees that a breach of the agreements,  covenants
and conditions  contained in Sections 7, 8, 9 and 10 of this Agreement may cause
irreparable  harm and damage to the  Company,  that the  remedy at law,  for the
breach  or  threatened  breach  of  such  provisions  of this  Agreement  may be
inadequate, and that, in addition to all other remedies available to the Company
for such breach or threatened breach (including,  without limitation,  the right
to recover damages),  the Company shall be entitled to injunctive relief for any
breach or threatened breach of such sections of this Agreement.

         20.  Governing Law. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of Utah.

         21.  Severability.  If and to the  extent  that any court of  competent
jurisdiction  holds any  provision or any part  thereof of this  Agreement to be
invalid or  unenforceable,  such holding  shall in no way affect the validity of
the remainder of this  Agreement.  Upon a  determination  that any term or other
provision is invalid,  illegal or incapable of being enforced, the Parties shall
negotiate  in good faith to modify this  Agreement  so as to effect the original
intent of the Parties as closely as possible in an acceptable  manner to the end
that the  transactions  contemplated  hereby are fulfilled to the maximum extent
possible.

         22.  Waiver.  No  failure  by any  party  to  insist  upon  the  strict
performance of any covenant,  duty, agreement, or condition of this Agreement or
to exercise any right or remedy consequent upon a breach hereof shall constitute
a waiver of any such breach or of any covenant, agreement, term, or condition.

         23.  Litigation  Expenses.  In the event that it shall be  necessary or
desirable for the Employee or Company to retain legal counsel and/or incur other
costs and  expenses  in  connection  with the  enforcement  of any or all of the
provisions of this Agreement,  the prevailing party shall be entitled to recover
from the other party reasonable attorneys' fees, costs, and expenses incurred by
the  prevailing party in  connection  with the  enforcement  of this  Agreement.
Notwithstanding  the foregoing,  in the event that following a Change of Control
Employee  engages  legal  counsel  to  enforce   Employee's  rights  or  seek  a
determination  under this Agreement,  the Company shall pay the expenses of such
legal  counsel  regardless  of the  outcome  of any legal  proceeding  resulting
therefrom.

         24.  Survivability.  the  provisions of sections 7, 8, 9, 10, 12 and 13
shall survive termination of this Agreement.

         AGREED AND ENTERED INTO effective as of the date first above written.

                                Company:

                                        Videolocity, Inc.

                                        By /s/ Larry R. McNeill, CFO
                                           --------------------------
                                           Duly Authorized Officer

                                Employee:

                                          /s/ Cortney L. Taylor
                                          ---------------------------
                                          (Signature)

                                              Cortney L. Taylor
                                          ---------------------------
                                          (Print Name)

                                          ---------------------------
                                          SS#

                                       9

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