Document:

[FORM
      OF]

    

    CHINA
      AGRO SCIENCES CORP.

    

    Common
      Stock Purchase Agreement

    Under
      2006 Non-Qualified Stock Grant and Option Plan

     

    THIS
      AGREEMENT is dated as of _______________, 20__, between China Agro Sciences
      Corp., a Florida corporation (the “Company”), and _________________________
      (“Purchaser”).

     

    WITNESSETH:

     

    WHEREAS,
      pursuant to the terms of a _________________________ Agreement dated
      ________________, 20__, by and between Purchaser and the Company (the
“_____________ Agreement”), the Company has agreed to issue to Purchaser
      _______________ shares of the Company’s common stock in exchange for
      __________________________________________.

     

    WHEREAS,
      pursuant to the terms hereof, Purchaser desires to purchase shares of the
      Company as herein described, on the terms and conditions set forth in this
      Agreement and the China Agro Sciences Corp. 2006 Non-Qualified Stock Grant
      and
      Option Plan (the “Plan”). Certain capitalized terms used in this Agreement are
      defined in the Plan.

     

    NOW,
      THEREFORE, it is agreed between the parties as follows:

     

    
      	1.  	
              PURCHASE
                OF SHARES.

            

    

     

    Purchaser
      hereby agrees to purchase from the Company and the Company agrees to sell and
      issue to Purchaser ________________ shares of the Company’s common stock (the
“Stock”) in exchange for ________________ valued by the Company at
      $___________
      per the
      terms of the ____________________ Agreement. Vesting of the Stock shall be
      governed by the ______________ Agreement. The closing hereunder (the “Closing”)
      shall occur at the offices of the Company on the date hereof, or such other
      time
      and place as may be designated by the Company (the “Closing Date”).
      The
      Purchaser’s interest in the Stock shall be fully vested as of the Closing
      Date.

     

    
      	2.  	
              PURCHASER’S
                INVESTMENT
                REPRESENTATIONS.

            

    

     

    This
      Agreement is made with Purchaser in reliance upon Purchaser’s representation to
      the Company, which by Purchaser’s acceptance hereof Purchaser confirms, that the
      Stock which Purchaser will receive will be acquired with Purchaser’s own funds
      for investment for an indefinite
      period for Purchaser’s own account, not as a nominee or agent, and not with a
      view to the sale or distribution of any part thereof, and that Purchaser has
      no
      present intention of selling, granting participation in, or otherwise
      distributing the same, but subject, nevertheless, to any requirement of law
      that
      the disposition of Purchaser’s property shall at all times
      be
      within Purchaser’s
      control. By executing this Agreement, Purchaser further represents that
      Purchaser does not have any contract, understanding or agreement with any person
      to sell, transfer, or grant participation, to such person or to any third
      person, with respect to any of the Stock.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    In
      connection with the investment representations made herein, Purchaser represents
      that Purchaser is able to fend for himself or herself in the transactions
      contemplated by this Agreement, has such knowledge and experience in financial
      and business matters as to be capable of evaluating the merits and risks of
      Purchaser’s investment, has the ability to bear the economic risks of
      Purchaser’s investment and has been furnished with and has had access to such
      information as would be made available in the form of a registration statement
      together with such additional information as is necessary to verify the accuracy
      of the information supplied and to have all questions answered by the
      Company.

     

    
      	3.  	
              NO
                DUTY TO TRANSFER IN VIOLATION
                HEREUNDER.

            

    

     

    The
      Company shall not be required (a) to transfer on its books any shares of
      Stock of the Company which shall have been sold or transferred in violation
      of
      any of the provisions set forth in this Agreement or (b) to treat as owner
      of such shares or to accord the right to vote as such owner or to pay dividends
      to any transferee to whom such shares shall have been so
      transferred.

     

    
      	4.  	
              OTHER
                NECESSARY ACTIONS.

            

    

     

    The
      parties agree to execute such further instruments and to take such further
      action as may reasonably be necessary to carry out the intent of this
      Agreement.

     

    
      	5.  	
              NOTICE.

            

    

     

      Any
      notice, request, or instructions given in connection with this Option shall
      be
      in writing and shall be delivered in person during normal business hours, by
      facsimile, or by overnight mail against a receipt for delivery, to the following
      addresses:

     

      If
      to
      Grantor, at China Agro Sciences Corp., 100 Wall Street, 15th
      Floor,
      New York, NY 10005, Facsimile No. (___) ____________, Attention:
      President.

     

    If
      to
      Grantee, at ___________________________, Facsimile No. (___) ____________ or
      at
      such other address as either of the parties shall have given notice to the
      other
      in accordance with the provisions hereof.

     

    
      	6.  	
              SUCCESSORS
                AND ASSIGNS.

            

    

     

    This
      Agreement shall inure to the benefit of the successors and assigns of the
      Company and, subject to the restrictions on transfer herein set forth, be
      binding upon Purchaser and Purchaser’s heirs, executors, administrators,
      successors and assigns. No waiver of any breach or condition of this Agreement
      shall be deemed to be a waiver of any other or subsequent breach or condition,
      whether of a like or different nature.

     

    
      	7.  	
              APPLICABLE
                LAW.

            

    

     

    This
      Agreement shall be governed by, and construed in accordance with, the laws
      of
      the State of Florida, as such laws are applied to contracts entered into and
      performed in such state.

     

    
      	8.  	
              NO
                ORAL MODIFICATION.

            

    

     

    No
      modification of this Agreement shall be valid unless made in writing and signed
      by the parties hereto.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

       

    

    
      	9.  	
              ENTIRE
                AGREEMENT.

            

    

     

    This
      Agreement and the ____________ Agreement constitute the entire complete and
      final agreement between the parties hereto with regard to the subject matter
      hereof.

     

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

     

    
      	China
              Agro
              Sciences Corp.,
an Florida corporation	 	 	 
	 	 	 	
              

            
	 	 	 	 
	
              
By:
Its:	 	 	
              
By:
Its:

    

     

     

    
      
        
        

      

      
        3Exhibit 10.1

                          SECURITIES PURCHASE AGREEMENT

      THIS SECURITIES  PURCHASE AGREEMENT (this  "Agreement"),  dated as of July
28, 2006, by and among TELEPLUS  ENTERPRISES,  INC., a Nevada  corporation  (the
"Company"), and the Buyers listed on Schedule I attached hereto (individually, a
"Buyer" or collectively "Buyers").

                                   WITNESSETH

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

      WHEREAS,  the  parties  desire  that,  upon the terms and  subject  to the
conditions  contained herein,  the Company shall issue and sell to the Buyer(s),
as provided herein,  and the Buyer(s) shall purchase up to Three Million Dollars
($3,000,000) of secured convertible  debentures (the "Convertible  Debentures"),
which shall be convertible  into shares of the Company's common stock, par value
$0.001 (the "Common Stock") (as converted, the "Conversion Shares"), which shall
be funded  on the fifth  (5th)  business  day  following  the date  hereof  (the
"Closing"),  for  a  total  purchase  price  of  up  to  Three  Million  Dollars
($3,000,000),  (the  "Purchase  Price")  in the  respective  amounts  set  forth
opposite each Buyer(s) name on Schedule I (the "Subscription Amount");

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

      WHEREAS,  contemporaneously  with  the  execution  and  delivery  of  this
Agreement,  the parties hereto are executing and delivering a Second Amended and
Restated Security Agreement substantially in the form attached hereto as Exhibit
B (the "Security Agreement") pursuant to which the Company has agreed to provide
the Buyer a security interest in Pledged  Collateral (as this term is defined in
the  Security  Agreement)  to  secure  the  Company's   obligations  under  this
Agreement,   the  Convertible   Debenture,   the  Investor  Registration  Rights
Agreement, the Irrevocable Transfer Agent Instructions,  the Security Agreement,
the Pledge and Escrow  Agreement or any other  obligations of the Company to the
Buyer;

      WHEREAS,  contemporaneously  with  the  execution  and  delivery  of  this
Agreement,  the parties hereto are executing and delivering a Second Amended and
Restated Pledge and Escrow  Agreement  substantially in the form attached hereto
as Exhibit C (the "Pledge and Escrow  Agreement")  pursuant to which the Company
has agreed to provide the Buyer a security  interest  in the Pledged  Shares (as
this term is defined in the Pledge and Escrow Agreement) to secure the Company's
obligations  under this  Agreement,  the  Convertible  Debenture,  the  Investor
Registration Rights Agreement, the Irrevocable Transfer Agent Instructions,  the
Security Agreement,  the Pledge and Escrow Agreement or any other obligations of
the Company to the Buyer;

<PAGE>

      WHEREAS,  contemporaneously  with  the  execution  and  delivery  of  this
Agreement,  the parties  hereto are  executing  and  delivering  an  Irrevocable
Transfer Agent Instructions substantially in the form attached hereto as Exhibit
D (the "Irrevocable Transfer Agent Instructions"); and

      WHEREAS,  contemporaneously  with  the  execution  and  delivery  of  this
Agreement,  the parties hereto are executing and delivering a Second Amended and
Restated  Security  Agreement by and among the  Company,  the Buyer and TelePlus
Connect  Corp.,  an Ontario  corporation  and a wholly owned  subsidiary  of the
Company (a "Subsidiary"),  a Second Amended and Restated  Security  Agreement by
and  among  the  Company,  the  Buyer and  TelePlus  Retail  Services,  a Quebec
corporation and a wholly owned subsidiary of the Company (a "Subsidiary")  and a
Second  Amended and Restated  Security  Agreement by and among the Company,  the
Buyer and  TelePlus  Wireless  Corp.,  a Nevada  corporation  and a wholly owned
subsidiary of the Company (a  "Subsidiary"),  substantially in the form attached
hereto  as  Exhibit  E  (collectively,  the  "Subsidiary  Security  Agreements")
pursuant  to which the  Company  and the  Subsidiary  have agreed to provide the
Buyer a security interest in Pledged  Collateral (as this term is defined in the
Subsidiary Security  Agreements) to secure the Company's  obligations under this
Agreement,   the  Convertible   Debenture,   the  Investor  Registration  Rights
Agreement, the Irrevocable Transfer Agent Instructions,  the Security Agreement,
the Subsidiary Security Agreements, the Pledge and Escrow Agreement or any other
obligations of the Company to the Buyer.

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

PURCHASE AND SALE OF CONVERTIBLE DEBENTURES.
--------------------------------------------

Purchase of Convertible  Debentures.  Subject to the satisfaction (or waiver) of
the terms and conditions of this Agreement, each Buyer agrees, severally and not
jointly,  to purchase at the Closing and the Company agrees to sell and issue to
each Buyer, severally and not jointly, at the Closing, Convertible Debentures in
amounts  corresponding  with the  Subscription  Amount set forth  opposite  each
Buyer's name on Schedule I hereto.

Closing Date. The Closing of the purchase and sale of the Convertible Debentures
shall take place at 10:00 a.m. Eastern Standard Time within two (2) business day
following  the date  hereof,  subject to  notification  of  satisfaction  of the
conditions  to the  Closing  set forth  herein and in Sections 6 and 7 below (or
such later date as is mutually  agreed to by the Company and the Buyer(s))  (the
"Closing  Date").  The Closing shall occur on the Closing Date at the offices of
Yorkville Advisors,  LLC, 101 Hudson Street, Suite 3700, Jersey City, New Jersey
07302 (or such  other  place as is  mutually  agreed to by the  Company  and the
Buyer(s)).

Form of Payment. Subject to the satisfaction of the terms and conditions of this
Agreement, on the Closing Date, (i) the Buyers shall deliver to the Company such
aggregate proceeds for the Convertible  Debentures to be issued and sold to such
Buyer(s), minus the fees to be paid directly from the proceeds of the Closing as
set forth herein, and (ii) the Company shall deliver to each Buyer,  Convertible
Debentures which such Buyer(s) is purchasing in amounts indicated  opposite such
Buyer's name on Schedule I, duly executed on behalf of the Company.

BUYER'S REPRESENTATIONS AND WARRANTIES.
---------------------------------------

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

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

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

                                       2
<PAGE>

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

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

No Governmental  Review. Each Buyer understands that no United States federal or
state agency or any other  government  or  governmental  agency has passed on or
made any  recommendation  or  endorsement of the  Convertible  Debentures or the
Conversion  Shares,  or the fairness or  suitability  of the  investment  in the
Convertible  Debentures  or the  Conversion  Shares,  nor have such  authorities
passed upon or endorsed the merits of the offering of the Convertible Debentures
or the Conversion Shares.

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

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

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

                                       3
<PAGE>

The  legend set forth  above  shall be removed  and the  Company  within two (2)
business days shall issue a certificate without such legend to the holder of the
Conversion  Shares upon which it is stamped,  if, unless  otherwise  required by
state securities laws, (i) in connection with a sale  transaction,  provided the
Conversion  Shares are registered under the Securities Act or (ii) in connection
with a sale transaction,  after such holder provides the Company with an opinion
of counsel,  which opinion shall be in form,  substance and scope  customary for
opinions  of counsel in  comparable  transactions,  to the effect  that a public
sale,  assignment  or  transfer  of the  Conversion  Shares may be made  without
registration under the Securities Act.

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

Receipt of Documents. Each Buyer and his or its counsel has received and read in
their  entirety:  (i) this  Agreement  and  each  representation,  warranty  and
covenant set forth herein,  the Security  Agreement,  the Investor  Registration
Rights Agreement,  the Irrevocable Transfer Agent Agreement,  and the Pledge and
Escrow  Agreement;  (ii) all due  diligence and other  information  necessary to
verify the accuracy and  completeness  of such  representations,  warranties and
covenants;  (iii) the Company's  Form 10-KSB for the fiscal year ended  December
31, 2005;  (iv) the Company's Form 10-QSB for the fiscal quarter ended March 31,
2006 and (v)  answers to all  questions  each  Buyer  submitted  to the  Company
regarding  an  investment  in the  Company;  and each  Buyer  has  relied on the
information  contained  therein and has not been furnished any other  documents,
literature, memorandum or prospectus.

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

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

REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
----------------------------------------------

      The Company  represents and warrants to each of the Buyers that, except as
set forth in the SEC Documents (as defined herein):

Organization   and   Qualification.   The  Company  and  its   subsidiaries  are
corporations duly organized and validly existing in good standing under the laws
of the  jurisdiction  in which  they are  incorporated,  and have the  requisite
corporate  power to own their  properties  and to carry on their business as now
being conducted. Each of the Company and its subsidiaries is duly qualified as a
foreign corporation to do business and is in good standing in every jurisdiction
in which the nature of the  business  conducted  by it makes such  qualification
necessary,  except to the extent  that the failure to be so  qualified  or be in
good standing  would not have a material  adverse  effect on the Company and its
subsidiaries taken as a whole.

                                       4
<PAGE>

Authorization,  Enforcement,  Compliance with Other Instruments. (i) The Company
has the requisite  corporate  power and authority to enter into and perform this
Agreement,  the Security  Agreement,  the Subsidiary  Security  Agreements,  the
Investor   Registration  Rights  Agreement,   the  Irrevocable   Transfer  Agent
Agreement,   the  Pledge  and  Escrow  Agreement,  and  any  related  agreements
(collectively  the  "Transaction   Documents")  and  to  issue  the  Convertible
Debentures  and the  Conversion  Shares in accordance  with the terms hereof and
thereof,  (ii) the  execution and delivery of the  Transaction  Documents by the
Company and the consummation by it of the transactions  contemplated  hereby and
thereby,  including,   without  limitation,  the  issuance  of  the  Convertible
Debentures  the  Conversion  Shares and the  reservation  for  issuance  and the
issuance of the Conversion  Shares issuable upon conversion or exercise thereof,
have been duly  authorized  by the  Company's  Board of Directors and no further
consent or authorization  is required by the Company,  its Board of Directors or
its  stockholders,  (iii) the Transaction  Documents have been duly executed and
delivered by the Company,  (iv) the Transaction  Documents  constitute the valid
and  binding  obligations  of the  Company  enforceable  against  the Company in
accordance  with their terms,  except as such  enforceability  may be limited by
general   principles   of   equity   or   applicable   bankruptcy,   insolvency,
reorganization,   moratorium,  liquidation  or  similar  laws  relating  to,  or
affecting  generally,  the  enforcement of creditors'  rights and remedies.  The
authorized  officer of the Company executing the Transaction  Documents knows of
no reason why the Company  cannot file the  registration  statement  as required
under the Investor Registration Rights Agreement or perform any of the Company's
other obligations under such documents.

Capitalization.  As of the date  hereof,  the  authorized  capital  stock of the
Company  consists of  600,000,000  shares of Common Stock,  par value $0.001 per
share and  10,000,000  shares of  Preferred  Stock,  $0.001  par value per share
("Preferred  Stock"),  of which 88,276,901  shares of Common Stock and 2,000,000
shares of Preferred Stock were issued and  outstanding.  All of such outstanding
shares have been validly issued and are fully paid and nonassessable.  Except as
disclosed in the SEC Documents (as defined in Section 3(f)), no shares of Common
Stock are subject to preemptive  rights or any other similar rights or any liens
or encumbrances suffered or permitted by the Company. Except as disclosed in the
SEC Documents,  as of the date of this  Agreement,  (i) there are no outstanding
options,  warrants,  scrip,  rights to subscribe to, calls or commitments of any
character  whatsoever relating to, or securities or rights convertible into, any
shares of capital stock of the Company or any of its subsidiaries, or contracts,
commitments,  understandings  or arrangements by which the Company or any of its
subsidiaries is or may become bound to issue additional  shares of capital stock
of the Company or any of its subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character  whatsoever  relating to, or
securities  or rights  convertible  into,  any  shares of  capital  stock of the
Company  or  any  of its  subsidiaries,  (ii)  there  are  no  outstanding  debt
securities  and (iii) there are no  agreements or  arrangements  under which the
Company or any of its  subsidiaries  is obligated to register the sale of any of
their  securities  under the Securities Act (except pursuant to the Registration
Rights Agreement) and (iv) there are no outstanding  registration statements and
there are no outstanding  comment  letters from the SEC or any other  regulatory
agency.  There are no  securities or  instruments  containing  anti-dilution  or
similar  provisions  that will be triggered  by the issuance of the  Convertible
Debentures  as described  in this  Agreement.  The Company has  furnished to the
Buyer true and correct  copies of the Company's  Articles of  Incorporation,  as
amended and as in effect on the date hereof (the  "Articles of  Incorporation"),
and the Company's By-laws, as in effect on the date hereof (the "By-laws"),  and
the terms of all securities convertible into or exercisable for Common Stock and
the material  rights of the holders  thereof in respect thereto other than stock
options issued to employees and consultants.

Issuance of Securities. The Convertible Debentures are duly authorized and, upon
issuance in accordance with the terms hereof,  shall be duly issued,  fully paid
and  nonassessable,  are free from all taxes,  liens and charges with respect to
the issue  thereof.  The  Conversion  Shares  issuable  upon  conversion  of the
Convertible Debentures have been duly authorized and reserved for issuance. Upon
conversion  or  exercise  in  accordance  with the  Convertible  Debentures  the
Conversion Shares will be duly issued, fully paid and nonassessable.

No Conflicts. Except as disclosed in the SEC Documents, the execution,  delivery
and performance of the Transaction Documents by the Company and the consummation
by the Company of the transactions  contemplated hereby will not (i) result in a
material  violation of the  Certificate  of  Incorporation,  any  certificate of
designations of any outstanding  series of preferred stock of the Company or the
By-laws or (ii)  conflict  with or  constitute a default (or an event which with
notice or lapse of time or both would become a default) under, or give to others
any rights of  termination,  amendment,  acceleration  or  cancellation  of, any
agreement,  indenture  or  instrument  to  which  the  Company  or  any  of  its
subsidiaries is a party, or result in a violation of any law, rule,  regulation,
order,  judgment  or decree  (including  federal and state  securities  laws and
regulations  and the  rules  and  regulations  of The  National  Association  of
Securities  Dealers  Inc.'s  OTC  Bulletin  Board on which the  Common  Stock is
quoted)  applicable  to the Company or any of its  subsidiaries  or by which any
property  or  asset  of the  Company  or any of its  subsidiaries  is  bound  or
affected. Except as disclosed in the SEC Documents,  neither the Company nor its
subsidiaries  is in violation of any term of or in default under its Articles of
Incorporation   or  By-laws  or  their   organizational   charter  or   by-laws,
respectively,  or any  material  contract,  agreement,  mortgage,  indebtedness,
indenture,  instrument,  judgment,  decree  or  order  or any  statute,  rule or
regulation  applicable to the Company or its  subsidiaries.  The business of the
Company and its subsidiaries is not being conducted,  and shall not be conducted
in violation of any material law,  ordinance,  or regulation of any governmental
entity.  Except as  specifically  contemplated by this Agreement and as required
under the Securities Act and any applicable  state  securities laws, the Company
is not  required to obtain any consent,  authorization  or order of, or make any
filing or registration with, any court or governmental agency in order for it to
execute, deliver or perform any of its obligations under or contemplated by this
Agreement or the  Registration  Rights  Agreement in  accordance  with the terms
hereof or thereof.  Except as  disclosed  in the SEC  Documents,  all  consents,
authorizations,  orders, filings and registrations which the Company is required
to obtain  pursuant to the preceding  sentence have been obtained or effected on
or prior to the date hereof. The Company and its subsidiaries are unaware of any
facts or circumstance, which might give rise to any of the foregoing.

                                       5
<PAGE>

SEC  Documents:  Financial  Statements.  Since January 1, 2003,  the Company has
filed all reports,  schedules, forms, statements and other documents required to
be filed by it with the SEC under of the  Securities  Exchange  Act of 1934,  as
amended  (the  "Exchange  Act") (all of the  foregoing  filed  prior to the date
hereof or amended  after the date hereof and all exhibits  included  therein and
financial  statements  and  schedules  thereto  and  documents  incorporated  by
reference therein,  being hereinafter  referred to as the "SEC Documents").  The
Company has delivered to the Buyers or their representatives,  or made available
through the SEC's website at  http://www.sec.gov.,  true and complete  copies of
the SEC Documents. As of their respective dates, the financial statements of the
Company disclosed in the SEC Documents (the "Financial  Statements") complied as
to form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto.  Such financial
statements have been prepared in accordance with generally  accepted  accounting
principles, consistently applied, during the periods involved (except (i) as may
be otherwise  indicated in such Financial  Statements or the notes  thereto,  or
(ii) in the case of unaudited interim statements, to the extent they may exclude
footnotes or may be condensed or summary  statements) and, fairly present in all
material respects the financial  position of the Company as of the dates thereof
and the  results of its  operations  and cash flows for the  periods  then ended
(subject,  in the  case  of  unaudited  statements,  to  normal  year-end  audit
adjustments).  No other  information  provided by or on behalf of the Company to
the  Buyer  which  is not  included  in the SEC  Documents,  including,  without
limitation,  information  referred  to in this  Agreement,  contains  any untrue
statement of a material  fact or omits to state any material  fact  necessary in
order to make the statements  therein,  in the light of the circumstances  under
which they were made, not misleading.

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

Absence  of  Litigation.  Except  as  disclosed  in the  SEC  Documents  and the
Disclosure  Schedule (the "Disclosure  Schedule")  attached hereto as Exhibit G,
there is no action, suit, proceeding,  inquiry or investigation before or by any
court,  public board,  government agency,  self-regulatory  organization or body
pending  against  or  affecting  the  Company,  the  Common  Stock or any of the
Company's subsidiaries, wherein an unfavorable decision, ruling or finding would
(i) have a material adverse effect on the transactions  contemplated hereby (ii)
adversely affect the validity or enforceability  of, or the authority or ability
of the Company to perform its  obligations  under,  this Agreement or any of the
documents contemplated herein, or (iii) except as expressly disclosed in the SEC
Documents,  have  a  material  adverse  effect  on  the  business,   operations,
properties,  financial condition or results of operations of the Company and its
subsidiaries taken as a whole.

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

                                       6
<PAGE>

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

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

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

Intellectual  Property  Rights.  The Company and its subsidiaries own or possess
adequate rights or licenses to use all trademarks,  trade names,  service marks,
service mark registrations,  service names, patents, patent rights,  copyrights,
inventions, licenses, approvals, governmental authorizations,  trade secrets and
rights  necessary to conduct their respective  businesses as now conducted.  The
Company and its  subsidiaries  do not have any knowledge of any  infringement by
the Company or its subsidiaries of trademark, trade name rights, patents, patent
rights, copyrights,  inventions, licenses, service names, service marks, service
mark registrations,  trade secret or other similar rights of others, and, to the
knowledge of the Company there is no claim,  action or proceeding  being made or
brought against, or to the Company's  knowledge,  being threatened against,  the
Company or its subsidiaries  regarding  trademark,  trade name, patents,  patent
rights,  invention,  copyright,  license,  service names, service marks, service
mark registrations,  trade secret or other infringement; and the Company and its
subsidiaries are unaware of any facts or circumstances  which might give rise to
any of the foregoing.

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

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

Insurance.  The Company and each of its  subsidiaries are insured by insurers of
recognized  financial  responsibility  against such losses and risks and in such
amounts as management of the Company believes to be prudent and customary in the
businesses in which the Company and its  subsidiaries  are engaged.  Neither the
Company nor any such  subsidiary has been refused any insurance  coverage sought
or applied for and neither the Company nor any such subsidiary has any reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage  expires or to obtain similar  coverage from similar insurers
as may be necessary to continue its business at a cost that would not materially
and adversely  affect the  condition,  financial or otherwise,  or the earnings,
business or operations of the Company and its subsidiaries, taken as a whole.

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

                                       7
<PAGE>

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

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

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

Certain Transactions.  Except as set forth in the SEC Documents,  and except for
arm's length  transactions  pursuant to which the Company makes  payments in the
ordinary  course of business upon terms no less favorable than the Company could
obtain from third parties and other than the grant of stock options disclosed in
the SEC Documents, none of the officers,  directors, or employees of the Company
is  presently  a party to any  transaction  with  the  Company  (other  than for
services  as  employees,  officers  and  directors),   including  any  contract,
agreement or other  arrangement  providing for the  furnishing of services to or
by,  providing for rental of real or personal  property to or from, or otherwise
requiring payments to or from any officer,  director or such employee or, to the
knowledge of the Company, any corporation, partnership, trust or other entity in
which any officer,  director, or any such employee has a substantial interest or
is an officer, director, trustee or partner.

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

COVENANTS.

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

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

Reporting Status. Until the earlier of (i) the date as of which the Buyer(s) may
sell all of the Conversion  Shares without  restriction  pursuant to Rule 144(k)
promulgated under the Securities Act (or successor thereto), or (ii) the date on
which (A) the Buyer(s) shall have sold all the Conversion Shares and (B) none of
the Convertible  Debentures are outstanding  (the  "Registration  Period"),  the
Company shall file in a timely manner all reports  required to be filed with the
SEC pursuant to the Exchange Act and the regulations of the SEC thereunder,  and
the Company shall not terminate its status as an issuer required to file reports
under the Exchange  Act even if the  Exchange  Act or the rules and  regulations
thereunder would otherwise permit such termination.

                                       8
<PAGE>

Use of  Proceeds.  The  Company  will  use the  proceeds  from  the  sale of the
Convertible Debentures for general corporate and working capital purposes.

Reservation of Shares. The Company shall take all action reasonably necessary to
at all times have  authorized,  and reserved  for the purpose of issuance,  such
number of shares of Common Stock as shall be necessary to effect the issuance of
the Conversion  Shares.  If at any time the Company does not have available such
shares of Common  Stock as shall from time to time be  sufficient  to effect the
conversion of all of the  Conversion  Shares,  the Company shall call and hold a
special meeting of the shareholders  within thirty (30) days of such occurrence,
for the sole  purpose  of  increasing  the  number  of  shares  authorized.  The
Company's  management  shall  recommend to the  shareholders to vote in favor of
increasing  the number of shares of Common Stock  authorized.  Management  shall
also vote all of its  shares in favor of  increasing  the  number of  authorized
shares of Common Stock.

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

Fees and Expenses.
------------------

Each of the Company and the Buyer(s)  shall pay all costs and expenses  incurred
by such party in connection with the  negotiation,  investigation,  preparation,
execution  and  delivery of the  Transaction  Documents.  The Company  shall pay
Yorkville  Advisors  LLC a fee  equal to Three  Hundred  Seventy  Five  Thousand
Dollars  ($375,000) of the Purchase  Price which shall be paid pro rata directly
from the gross proceeds of the Closing.

The Company shall pay a structuring fee to Yorkville Advisors Management, LLC of
Twenty Five Thousand  Dollars  ($25,000),  which shall be paid directly from the
proceeds of the Closing.

Warrants.  Upon  the  execution  of this  Agreement,  the  Company  issue to the
Investor  warrants (the  "Warrants") to purchase in the aggregate Thirty Million
(30,000,000)  shares of the Company's Common Stock as follows:  (A) a warrant to
purchase Five Million  (5,000,000)  shares of the  Company's  Common Stock for a
period of four (4) years at an exercise price of $0.11 per share;  (B) a warrant
to purchase Ten Million  (10,000,000) shares of the Company's Common Stock for a
period of four (4) years at an exercise price of $0.15 per share;  (C) a warrant
to purchase Ten Million  (10,000,000) shares of the Company's Common Stock for a
period of four (4) years at an  exercise  price of $0.13  per  share;  and (D) a
warrant to purchase  Five Million  (5,000,000)  shares of the  Company's  Common
Stock  for a period of four (4)  years at an  exercise  price of $0.18 per share
(the shares of Common Stock underlying the above Warrants shall  collectively be
referred to as the "Warrant Shares"). The Warrant Shares shall have "piggy-back"
and demand registration rights.

Upon the execution of this Agreement,  the Company shall issue to the Buyer Four
Hundred Thousand (400,000) shares of the Company's Common Stock (the "Commitment
Shares").  The Commitment Shares shall be deemed fully earned on the date hereof
and shall have "piggy-back" and demand registration rights.

Corporate  Existence.  So  long  as  any of the  Convertible  Debentures  remain
outstanding, the Company shall not directly or indirectly consummate any merger,
reorganization, restructuring, reverse stock split consolidation, sale of all or
substantially all of the Company's assets or any similar  transaction or related
transactions (each such transaction,  an "Organizational  Change") unless, prior
to the consummation an  Organizational  Change,  the Company obtains the written
consent of each  Buyer.  In any such case,  the  Company  will make  appropriate
provision with respect to such holders'  rights and interests to insure that the
provisions of this Section 4(h) will thereafter be applicable to the Convertible
Debentures.

                                       9
<PAGE>

Transactions  With  Affiliates.  So  long  as  any  Convertible  Debentures  are
outstanding, the Company shall not, and shall cause each of its subsidiaries not
to, enter into, amend,  modify or supplement,  or permit any subsidiary to enter
into, amend,  modify or supplement any agreement,  transaction,  commitment,  or
arrangement with any of its or any subsidiary's officers,  directors, person who
were  officers  or  directors  at any time  during the  previous  two (2) years,
stockholders who beneficially own five percent (5%) or more of the Common Stock,
or  Affiliates  (as  defined  below) or with any  individual  related  by blood,
marriage,  or  adoption to any such  individual  or with any entity in which any
such entity or individual owns a five percent (5%) or more  beneficial  interest
(each a "Related Party"),  except for (a) customary employment  arrangements and
benefit programs on reasonable  terms, (b) any investment in an Affiliate of the
Company,  (c) any  agreement,  transaction,  commitment,  or  arrangement  on an
arms-length  basis on terms no less  favorable  than terms which would have been
obtainable  from a person  other than such  Related  Party,  (d) any  agreement,
transaction,  commitment,  or arrangement which is approved by a majority of the
disinterested directors of the Company; for purposes hereof, any director who is
also an officer of the Company or any  subsidiary  of the Company shall not be a
disinterested  director  with  respect  to  any  such  agreement,   transaction,
commitment, or arrangement.  "Affiliate" for purposes hereof means, with respect
to any person or entity,  another person or entity that, directly or indirectly,
(i) has a ten percent  (10%) or more  equity  interest in that person or entity,
(ii) has ten percent (10%) or more common  ownership with that person or entity,
(iii)  controls that person or entity,  or (iv) shares common  control with that
person or entity.  "Control"  or  "controls"  for  purposes  hereof means that a
person or entity has the  power,  direct or  indirect,  to conduct or govern the
policies of another person or entity.

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

Restriction  on  Issuance  of the  Capital  Stock.  So long  as any  Convertible
Debentures  are  outstanding,  the Company shall not,  without the prior written
consent of the Buyer(s) which shall not be unreasonably  withheld,  (i) issue or
sell shares of Common Stock or Preferred Stock without or without  consideration
(ii)  issue any  warrant,  option,  right,  contract,  call,  or other  security
instrument  granting the holder thereof,  the right to acquire Common Stock with
or without consideration,  (iii) enter into any security instrument granting the
holder a  security  interest  in any and all  assets  of the  Company  except as
otherwise  provided in the  Security  Agreement of even date between the Company
and the Buyers, or (iv) file any registration  statement on Form S-8, except for
a registration  statement on Form S-8 registering up to Two Million  (2,000,000)
shares of Common  Stock under an  Employee  Stock  Option  Plan.  The  foregoing
restriction  shall exclude options granted and outstanding  before July 15, 2005
under the  Company's  bona fide  Employee  Stock Option  Plan,  and any options,
warrants or other securities  convertible or exchangeable  into shares of Common
Stock of the Company (as outlined in the Disclosure  Schedule) that were granted
and outstanding prior to July 15, 2005. In addition,  the foregoing  restriction
shall exclude the issuance of  restricted  shares of Common Stock of the Company
in connection with an acquisition of another  business or equity financing up to
Two Million (2,000,000) shares of Common Stock in the aggregate.

Neither the Buyer(s) nor any of its  affiliates  have an open short  position in
the Common Stock of the Company,  and the Buyer(s) agrees that it shall not, and
that it will  cause its  affiliates  not to,  engage  in any  short  sales of or
hedging transactions with respect to the Common Stock as long as any Convertible
Debenture or warrants to purchase the Warrant Shares shall remain outstanding.

Rights of First Refusal.  So long as any portion of  Convertible  Debentures are
outstanding,  if the Company intends to raise additional capital by the issuance
or sale of capital stock of the Company,  including without limitation shares of
any class of common stock,  any class of preferred stock,  options,  warrants or
any other  securities  convertible  or  exercisable  into shares of common stock
(whether the offering is conducted by the Company, underwriter,  placement agent
or any third  party) the Company  shall be obligated to offer to the Buyers such
issuance or sale of capital stock, by providing in writing the principal  amount
of capital it intends to raise and outline of the material terms of such capital
raise, prior to the offering such issuance or sale of capital stock to any third
parties including,  but not limited to, current or former officers or directors,
current or former  shareholders  and/or investors of the obligor,  underwriters,
brokers,  agents or other third parties. The Buyers shall have ten (10) business
days from  receipt of such notice of the sale or  issuance  of capital  stock to
accept or reject such capital  raising offer.  The Buyer's  acceptance  shall be
made in writing and shall be on the same terms as the issuance or sale presented
by the Company to the Buyer.

                                       10
<PAGE>

TRANSFER AGENT INSTRUCTIONS.
----------------------------

The Company  shall issue the  Irrevocable  Transfer  Agent  Instructions  to its
transfer agent  irrevocably  appointing  David  Gonzalez,  Esq. as the Company's
agent for purpose of having certificates  issued,  registered in the name of the
Buyer(s) or its respective  nominee(s),  for the Conversion Shares  representing
such amounts of  Convertible  Debentures  as specified  from time to time by the
Buyer(s) to the Company  upon  conversion  of the  Convertible  Debentures,  for
interest  owed  pursuant  to the  Convertible  Debenture,  and  for  any and all
Liquidated Damages (as this term is defined in the Investor  Registration Rights
Agreement). David Gonzalez, Esq. shall be paid a cash fee of Fifty Dollars ($50)
for  every  occasion  they  act  pursuant  to  the  Irrevocable  Transfer  Agent
Instructions.  The  Company  shall not change its  transfer  agent  without  the
express written  consent of the Buyer(s),  which may be withheld by the Buyer(s)
in its sole discretion. Prior to registration of the Conversion Shares under the
Securities  Act,  all  such  certificates  shall  bear  the  restrictive  legend
specified  in Section  2(g) of this  Agreement.  The  Company  warrants  that no
instruction other than the Irrevocable  Transfer Agent Instructions  referred to
in this Section 5, and stop transfer instructions to give effect to Section 2(g)
hereof  (in the case of the  Conversion  Shares  prior to  registration  of such
shares  under the  Securities  Act) will be given by the Company to its transfer
agent and that the Conversion  Shares shall otherwise be freely  transferable on
the books and  records  of the  Company as and to the  extent  provided  in this
Agreement  and the  Investor  Registration  Rights  Agreement.  Nothing  in this
Section 5 shall  affect in any way the  Buyer's  obligations  and  agreement  to
comply with all applicable  securities laws upon resale of Conversion Shares. If
the Buyer(s) provides the Company with an opinion of counsel, in form, scope and
substance  customary for opinions of counsel in comparable  transactions  to the
effect that  registration  of a resale by the Buyer(s) of any of the  Conversion
Shares is not required  under the  Securities  Act, the Company shall within two
(2) business days instruct its transfer agent to issue one or more  certificates
in such name and in such  denominations  as specified by the Buyer.  The Company
acknowledges  that  a  breach  by it of its  obligations  hereunder  will  cause
irreparable  harm to the  Buyer by  vitiating  the  intent  and  purpose  of the
transaction contemplated hereby. Accordingly,  the Company acknowledges that the
remedy  at law for a breach  of its  obligations  under  this  Section 5 will be
inadequate  and  agrees,  in the event of a breach or  threatened  breach by the
Company  of the  provisions  of this  Section  5,  that  the  Buyer(s)  shall be
entitled,  in  addition  to  all  other  available  remedies,  to an  injunction
restraining any breach and requiring  immediate  issuance and transfer,  without
the necessity of showing  economic  loss and without any bond or other  security
being required.

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

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

Each Buyer shall have executed the  Transaction  Documents and delivered them to
the Company.

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

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

                                       11
<PAGE>

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

The obligation of the Buyer(s) hereunder to Purchase the Convertible  Debentures
at the Closing is subject to the satisfaction, at or before the Closing Date, of
each of the following conditions:

The Company shall have executed the Transaction Documents and delivered the same
to the Buyer(s).

The Common Stock shall be authorized for quotation on the OTCBB,  trading in the
Common  Stock  shall  not  have  been  suspended  for  any  reason,  and all the
Conversion  Shares  issuable upon the conversion of the  Convertible  Debentures
shall be approved by the OTCBB.

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

The Company shall have  executed and  delivered to the Buyer(s) the  Convertible
Debentures in the  respective  amounts set forth  opposite each Buyer(s) name on
Schedule I attached hereto.

The  Buyer(s)  shall have  received  an opinion of counsel  from  Kirkpatrick  &
Lockhart Nicholson Graham LLP in a form satisfactory to the Buyer(s).

The Company shall have  provided to the Buyer(s) a certificate  of good standing
from the secretary of state from the state in which the company is incorporated.

The Company shall have  delivered to the Escrow Agent the Pledged Shares as well
executed and medallion  guaranteed stock bond powers as required pursuant to the
Pledge and Escrow Agreement.

The  Company  shall  have  provided  to the  Buyer  an  acknowledgement,  to the
satisfaction  of the Buyer,  from the  Company's  independent  certified  public
accountants as to its ability to provide all consents  required in order to file
a registration statement in connection with this transaction.

The Company shall have reserved out of its authorized and unissued Common Stock,
solely  for  the  purpose  of  effecting  the  conversion  of  the   Convertible
Debentures,  shares  of  Common  Stock to effect  the  conversion  of all of the
Conversion Shares then outstanding.

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

INDEMNIFICATION.
----------------

In  consideration  of the Buyer's  execution and delivery of this  Agreement and
acquiring the Convertible Debentures and the Conversion Shares hereunder, and in
addition to all of the Company's other  obligations  under this  Agreement,  the
Company shall defend, protect, indemnify and hold harmless the Buyer(s) and each
other holder of the Convertible Debentures and the Conversion Shares, and all of
their officers, directors,  employees and agents (including, without limitation,
those  retained  in  connection  with  the  transactions  contemplated  by  this
Agreement) (collectively,  the "Buyer Indemnitees") from and against any and all
actions,  causes of action,  suits,  claims,  losses,  costs,  penalties,  fees,
liabilities and damages, and expenses in connection  therewith  (irrespective of
whether  any  such  Buyer  Indemnitee  is  a  party  to  the  action  for  which
indemnification  hereunder is sought), and including reasonable  attorneys' fees
and  disbursements  (the  "Indemnified  Liabilities"),  incurred  by  the  Buyer
Indemnitees or any of them as a result of, or arising out of, or relating to (a)
any  misrepresentation  or breach of any  representation or warranty made by the
Company  in  this  Agreement,   the  Convertible   Debentures  or  the  Investor
Registration  Rights Agreement or any other certificate,  instrument or document
contemplated  hereby or thereby,  (b) any breach of any  covenant,  agreement or
obligation  of  the  Company  contained  in  this  Agreement,  or  the  Investor
Registration  Rights Agreement or any other certificate,  instrument or document
contemplated  hereby  or  thereby,  or (c) any  cause of  action,  suit or claim
brought or made against such Indemnitee and arising out of or resulting from the
execution,  delivery,  performance or enforcement of this Agreement or any other
instrument, document or agreement executed pursuant hereto by any of the parties
hereto, any transaction financed or to be financed in whole or in part, directly
or indirectly,  with the proceeds of the issuance of the Convertible  Debentures
or  the  status  of the  Buyer  or  holder  of the  Convertible  Debentures  the
Conversion Shares, as a Buyer of Convertible  Debentures in the Company.  To the
extent that the foregoing  undertaking by the Company may be  unenforceable  for
any reason,  the Company shall make the maximum  contribution to the payment and
satisfaction of each of the Indemnified Liabilities,  which is permissible under
applicable law.

                                       12
<PAGE>

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

GOVERNING LAW: MISCELLANEOUS.
-----------------------------

Governing Law. This Agreement shall be governed by and interpreted in accordance
with the laws of the State of New Jersey  without  regard to the  principles  of
conflict of laws.  The parties  further agree that any action between them shall
be heard in Hudson County, New Jersey, and expressly consent to the jurisdiction
and venue of the Superior Court of New Jersey,  sitting in Hudson County and the
United States  District  Court for the District of New Jersey sitting in Newark,
New Jersey for the  adjudication of any civil action  asserted  pursuant to this
Paragraph.

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

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

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

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

                                       13
<PAGE>

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

If to the Company, to:            Teleplus Enterprises, Inc.
                                  7575 TransCanada - Suite 305
                                  St-Laurent, Quebec H4T 1V6
                                  Attention:    Marius Silvasan, CEO
                                  Telephone:    (514) 344-0778
                                  Facsimile:    (514) 344-8675

With a copy to:                   Kirkpatrick & Lockhart Nicholson Graham LLP
                                  201 S. Biscayne Blvd. - Suite 2000
                                  Miami, Florida 33131
                                  Attention:    Clayton E. Parker, Esq.
                                  Telephone:    (305) 539-3306
                                  Facsimile:    (305) 358-7095

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

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

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

Survival.   Unless  this  Agreement  is  terminated   under  Section  9(l),  the
representations  and  warranties  of the Company and the  Buyer(s)  contained in
Sections 2 and 3, the agreements and covenants set forth in Sections 4, 5 and 9,
and the  indemnification  provisions  set forth in Section 8, shall  survive the
Closing  for a  period  of two  (2)  years  following  the  date  on  which  the
Convertible  Debentures are converted in full. The Buyer(s) shall be responsible
only  for  its  own  representations,   warranties,   agreements  and  covenants
hereunder.

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

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

                                       14
<PAGE>

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

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

                    [REMAINDER PAGE INTENTIONALLY LEFT BLANK]

                                       15
<PAGE>

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

                                         COMPANY:
                                         TELEPLUS ENTERPRISES, INC.

                                         By: /s/ Marius Silvasan
                                             -------------------------------
                                         Name:   Marius Silvasan
                                         Title:  CEO

                                       16
<PAGE>

                                    EXHIBIT A

                 FORM OF INVESTOR REGISTRATION RIGHTS AGREEMENT
                 ----------------------------------------------

                                       17
<PAGE>

                                    EXHIBIT B

                               SECURITY AGREEMENT
                               ------------------

                                       18
<PAGE>

                                    EXHIBIT C

                           PLEDGE AND ESCROW AGREEMENT
                           ---------------------------

                                       19
<PAGE>

                                    EXHIBIT D

                     IRREVOCABLE TRANSFER AGENT INSTRUCTIONS
                     ---------------------------------------

                                       20
<PAGE>

                                    EXHIBIT E

                         SUBSIDIARY SECURITY AGREEMENTS
                         ------------------------------

                                       21
<PAGE>

                                    EXHIBIT F

                               DISCLOSURE SCHEDULE
                               -------------------

(i)  SECURITIES:  The  Company  has  the  following  securities  outstanding  or
convertible into securities of the Company:

      KELLY  MCLAREN:  options to  purchase:  (i) 100,000  shares at an exercise
      price of USD$0.21 that vest on September 29, 2005;  (ii) 100,000 shares at
      an exercise  price of USD$0.22  that vest on April 1, 2007;  (iii) 100,000
      shares at an exercise  price of USD$0.23 that vest on April 1, 2008;  (iv)
      100,000  shares at an  exercise  price of  USD$0.24  that vest on April 1,
      2009; and (v) 100,000 shares at an exercise price of USD$0.25 that vest on
      April 1, 2010.  200,000  shares at an exercise price of USD$0.36 that vest
      the 29 of September 2005;  200,000 shares at an exercise price of USD$0.38
      that vest the 29 of September 2006; 200,000 shares at an exercise price of
      USD$0.40 that vest the 29 September  2007;  200,000  shares at an exercise
      price of  USD$0.45  that  vest 29  September  2008;  200,000  shares at an
      exercise price of USD$0.50 that vest 29 September 2009

      ROBERT KREBS: options to purchase:  (i) 70,000 shares at an exercise price
      of USD$0.21  that vest on  September  1, 2005;  (ii)  75,000  shares at an
      exercise  price of USD$0.22  that vest on June 1, 2006;  and (iii) 100,000
      shares at an  exercise  price of  USD$0.23  that vest on December 1, 2007.
      140,000 shares at an exercise price of USD$0.36 that vest the 1of December
      2004;  150,000  shares at an exercise price of USD$0.38 that vest the 1 of
      December 2005; 200,000 shares at an exercise price of USD$0.40 that vest 1
      June 2007

      MARIUS  SILVASAN:  options to purchase:  (i) 750,000 shares at an exercise
      price of USD $0.21 that vest on September 1, 2005;  (ii) 1,000,000  shares
      at an exercise price of USD $0.22 that vest on December 1, 2005; and (iii)
      1,250,000  shares at an exercise  price of USD $0.23 that vest on December
      1, 2006. 1,500,000 shares at an exercise price of $0.36 that vest the 3 of
      December  2004;  2,000,000  shares at an exercise price of $0.38 that vest
      the 3 of June 2005;  2,500,000  shares at an exercise  price of $0.40 that
      vest the 3 of June 2006

      MICHAEL  KARPHEDEN:  an option to  purchase  50,000  shares at an exercise
      price of USD$0.21 that vest on December 1, 2005.

      HAKAN  WRETSELL:  an option to purchase 50,000 shares at an exercise price
      of USD$0.21 that vest on December 1, 2005; and

      TOM DAVIS: options to purchase: (i) 150,000 shares at an exercise price of
      USD$0.21 that vest on May 1st,  2006;  (ii) 150,000  shares at an exercise
      price of USD$0.22 that vest on November 1, 2006;  (iii) 150,000  shares at
      an exercise  price of USD$0.23 that vest on May 1, 2007;  and (iv) 150,000
      shares at an exercise price of USD$0.24 that vest on November 1, 2007.

      CARLOS  CARDELLE:  options to purchase:  (a) 62,500  shares at an exercise
      price of USD$0.20 that vest on January 1st,  2007; (b) 62,500 shares at an
      exercise price of USD$0.21 that vest on July 1, 2007; (c) 62,500 shares at
      an exercise price of USD$0.22 that vest on January 1, 2008; and (d) 62,500
      shares at an exercise price of USD$0.23 that vest on July 1, 2008.

                                       22
<PAGE>

      KURT GORDON: options to purchase: 3,000,000 shares at an exercise price of
      USD$0.225 that vest on May 18th, 2006

      LAURA SEIJO:  options to purchase:  (i) 30,000 shares at an exercise price
      of USD$0.20  that vest on January  1st,  2007;  (ii)  30,000  shares at an
      exercise price of USD$0.21 that vest on July 1, 2007;  (iii) 30,000 shares
      at an exercise  price of USD$0.22  that vest on January 1, 2008;  and (iv)
      30,000 shares at an exercise price of USD$0.23 that vest on July 1, 2008.

      - Options expire three years after vesting date.

(ii) LITIGATION: The Company has the following pending litigation:

      This  action  was  brought by Howard  Salamon  d/b/a  "Salamon  Brothers",
seeking  the  sum  of  $200,000  as a  finder's  fee  for  introducing  TelePlus
Enterprises,  Inc. (TelePlus) to a source of capital.  Salamon claims 10% of the
total amount of financing  received from Cornell Capital Partners,  LP. TelePlus
has answered the Complaint and alleged several  affirmative  defenses  including
the  illegality  of the alleged  "finder's  fee  agreement"  on the grounds that
Salamon is not a registered  broker/dealer with either the NASD or SEC and under
well settled law cannot  therefore  enforce the finder's fee agreement.  Cornell
has moved to  intervene  in the action and  opposes  Salamon's  claim  asserting
tortuous interference with a contract as well as seeking a declaratory judgment.
Salamon has made a motion for an  attachment  of Cornell's  funds which has been
opposed by both Cornell and TelePlus and is on for a hearing  before Judge Walls
in Newark Federal District Court on July 25, 2005.

      TelePlus  entered into a consulting  agreement  with  Business  Consulting
Group  Unlimited  ("BCGU")  pursuant  to  which  BCGU  was  to  provide  certain
consulting  services to TelePlus.  TelePlus filed a lawsuit in federal  District
Court in Las Vegas,  Nevada against BCGU alleging that BCGU was in default under
the  consulting  agreement  for failing to perform the  services  required of it
under the agreement.  In response,  BCGU filed a separate lawsuit in state court
in San Diego California against TelePlus for payment of amounts allegedly due to
BCGU under the agreement.  It is TelePlus' position that no payments are owed to
BCGU due to BCGU's default under the agreement.

                                       23
<PAGE>

                                   SCHEDULE I
                                   ----------

                               SCHEDULE OF BUYERS
                               ------------------

<TABLE>
<CAPTION>
                                                                         ADDRESS/FACSIMILE                AMOUNT OF
          NAME                             SIGNATURE                      NUMBER OF BUYER                SUBSCRIPTION
----------------------------        ----------------------------      ------------------------------     ------------
<S>                                 <C>                               <C>                                <C>
Cornell Capital Partners, LP        By:  Yorkville Advisors, LLC      101 Hudson Street - Suite 3700      $ 3,000,000
                                    Its: General Partner              Jersey City, NJ  07303
                                                                      Facsimile: (201) 985-8266

                                    By:
                                        ------------------------
                                    Name: Mark Angelo
                                    Its:  Portfolio Manager

With a copy to:                     David Gonzalez, Esq.              101 Hudson Street - Suite 3700
                                                                      Jersey City, NJ 07302
                                                                      Facsimile: (201) 985-8266

</TABLE>

                                       24

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