Document:

INTERVEST MORTGAGE CORPORATION
                                ESCROW AGREEMENT

     THIS  ESCROW  AGREEMENT made as of this __th day of _________, 2004, by and
among  Intervest Mortgage Corporation, a New York corporation with its principal
offices  at  One  Rockefeller  Plaza,  Suite  400, New York, New York 10020-2002
("Corporation");  Sage,  Rutty  &  Co.,  Inc.,  a  New York corporation with its
principal  offices  at  1621  Jefferson  Road,  Rochester,  New  York  14623
("Underwriter");  and  Canandaigua  National  Bank and Trust Company, a national
banking  organization  with  its  principal  offices  at  72  South Main Street,
Canandaigua,  New  York  14424  ("Escrow  Agent").

                                R E C I T A L S:

     WHEREAS, the Corporation has filed a Form S-11 Registration Statement under
the  Securities  Act  of  1933  with  the  Securities  and  Exchange  Commission
("Registration  Statement")  covering  a  proposed  offering  of  a  minimum  of
$12,000,000  and maximum of $14,000,000 aggregate principal amount of its Series
__/__/04  Subordinated  Debentures  ("Debentures");  and

     WHEREAS,  the  Underwriter  intends  to  sell  the  Debentures  as  the
Corporation's  agent  on  a  best  efforts  basis;  and

     WHEREAS,  under  the  terms of the offering, subscription funds received on
the  sale  of  Debentures  will  be deposited in an escrow account until certain
terms  and  conditions  have  been  met;  and

     WHEREAS,  the  Corporation  desires  that the subscription funds be held in
escrow  by  the  Escrow  Agent  on  the  terms  and conditions set forth herein.

     NOW,  THEREFORE, in consideration of the mutual covenants contained herein,
the  parties  agree  as  follows:

     1.  Establishment  and  Custody  of  Escrow  Fund.
         ----------------------------------------------

          (a) On or prior to the date of the commencement of the offering of the
Debentures,  the parties shall establish an interest-bearing escrow account with
the Escrow Agent. The Corporation will notify the Escrow Agent in writing of the
effective  date  of  the  Registration  Statement.  The  escrow account shall be
entitled  "Canandaigua  National  Bank  &  Trust  Company,  as  Escrow Agent for
Intervest  Mortgage  Corporation."  The  Corporation  shall,  prior  to  the
establishment  of such account, furnish to the Escrow Agent a completed IRS Form
W-9.

          (b)  On  the next Business Day following receipt by the Corporation or
the  Underwriter  from  an  investor  desiring  to  purchase  Debentures
("Subscriber(s)") or from any participating selected dealer, of any subscription
documents  and payment of the subscription price (in the minimum of $10,000) for
Debentures  to  be  purchased, it will promptly transmit to the Escrow Agent the
following:

               (i)  Checks, bank drafts or money orders payable to "CNB - Escrow
Intervest"  or wire transfers to the escrow account (such sums as held by Escrow
Agent  in  collected  funds,  as  increased  or  decreased  by  any investments,
reinvestments  or distributions made in respect thereof and any interest thereon
as  held  from  time  to  time by the Escrow Agent pursuant to the terms of this
Escrow  Agreement,  being  hereafter  collectively  referred  to  as the "Escrow
Fund").  Such  funds  shall  be delivered to Canandaigua National Bank and Trust
Company,  1150  Pittsford-Victor  Road,  Pittsford,  New  York 14534, Attention:
Sharon Greisberger, Vice President, by 12:00 noon on the next Business Day after
receipt,  for  deposit  in  accordance  with  Section  2;  and

               (ii) With each deposit to the Escrow Fund, a statement containing
the  name,  address  and  tax  identification  number  of  each  Subscriber.

                                        1
<PAGE>
          (c)  Checks  or  other forms of payment not made payable to the Escrow
Agent  shall  be returned by the Escrow Agent to the purchaser who submitted the
check.

          (d)  For  purposes of this Escrow Agreement, a "Business Day" is a day
upon  which  the  Escrow  Agent  is  open  for  the  conduct  of  business.

          (e)  The  Escrow Agent will acknowledge receipt of the Escrow Fund and
will  hold  the  Escrow Funds subject to the terms and conditions of this Escrow
Agreement.

          (f)  The  Escrow  Agent  shall  notify  the Corporation when the total
amount  of  subscription  funds  in the Escrow Fund, less the amount of any such
checks  returned  for  insufficient  funds,  equals  at  least  $12,000,000 (the
"Minimum  Funds"). No investment profits or losses and no interest earned on any
investment  of  the  Escrow  Fund  shall  be  considered  for  purposes  of this
calculation.

          (g)  During  the  term  of  this  Escrow  Agreement,  the  Corporation
understands  that  it  is  not entitled to any funds received into escrow and no
amounts  deposited  shall  become  the  property of the Corporation or any other
entity,  or  be  subject  to  the  debts of the Corporation or any other entity.

     2.   Investment  of  Escrow  Fund.  Moneys held in the Escrow Fund shall be
          -----------------------------
invested  and  reinvested by the Escrow Agent in its trust money market account.
Moneys  held  in  the  Escrow  Fund  will,  in  any  event,  be invested only in
investments  permissible  under Rule 15c2-4 under the Securities Exchange Act of
1934.

     3.   Duties  of Escrow Agent.  Acceptance by the Escrow Agent of its duties
          ------------------------
under  this  Escrow  Agreement is subject to the following terms and conditions,
which  all  parties to this Escrow Agreement agree shall govern and control with
respect  to  the rights, duties, liabilities and immunities of the Escrow Agent.

          (a)  The  duties  and  responsibilities  of  the Escrow Agent shall be
limited  to  those  expressly  set forth in this Escrow Agreement and the Escrow
Agent  shall not be subject to, nor obligated to recognize, any other agreements
between  the  Corporation,  Underwriter  and  any  Subscriber.

          (b)  The  duties  of  the  Escrow  Agent  are  only such as are herein
specifically  provided  and  such duties are purely ministerial in nature.   The
Escrow Agent's primary duty shall be to keep custody of and safeguard the Escrow
Fund  during  the period of the escrow, to invest monies held in the Escrow Fund
in  accordance  with  Section 2 hereof and to make disbursements from the Escrow
Fund  in  accordance  with  Section  4  hereof.

          (c)  The  Escrow Agent shall be under no obligations in respect of the
Escrow Fund other than to faithfully follow the instructions herein contained or
delivered  to  the  Escrow  Agent in accordance with this Escrow Agreement.  The
Escrow  Agent  may rely and act upon any written notice, instruction, direction,
request,  waiver,  consent,  receipt or other paper or document which it in good
faith  believes  to  be  genuine and what it purports to be and the Escrow Agent
shall be subject to no liability with respect to the form, execution or validity
thereof.  If,  in  the opinion of the Escrow Agent, the instructions it receives
are  ambiguous,  uncertain or in conflict with any previous instructions or this
Escrow  Agreement,  then  the  Escrow  Agent  is authorized to hold and preserve
intact  the  Escrow Fund pending the settlement of any such controversy by final
adjudication  of  a  court  or  courts  of  proper  jurisdiction.

          (d)  The Escrow Agent shall not be liable for any error of judgment or
for  any  act  done  or  step  taken or omitted by it, in good faith, or for any
mistake of fact or law, or for anything which it may in good faith do or refrain
from  doing  in  connection herewith, unless caused by its willful misconduct or
gross  negligence.  The  Corporation  shall  indemnify and hold the Escrow Agent
harmless  from  and against any and all claims, losses, damages, liabilities and
expenses,  including  reasonable  attorneys' fees, which may be imposed upon the
Escrow  Agent  or incurred by the Escrow Agent in connection with its acceptance
of  the  appointment  as Escrow Agent hereunder or the performance of its duties
hereunder,  unless  the  Escrow  Agent  is  determined  to  have  committed  an
intentional  wrongful  act or to have been grossly negligent with respect to its
duties  under  this  Escrow  Agreement.

                                        2
<PAGE>
          (e)  The  Escrow  Agent  shall  return  to  the  Corporation  any sums
delivered  to  the  Escrow Agent pursuant to this Escrow Agreement for which the
Escrow Agent has not received release instructions pursuant to Section 4 hereof,
and  as  to  which  four  years  have  passed  since  delivery.

          (f)  The  Escrow Agent may consult with, and obtain advice from, legal
counsel  (which  may  not  be  counsel  to  the Corporation) in the event of any
dispute  or  questions as to the construction of any of the provisions hereof or
its duties hereunder, and it shall incur no liability in acting in good faith in
accordance with the written opinion and instructions of such counsel.   The fees
for  consultation  with  such  counsel  shall  be  paid  by  the  Corporation.

          (g)  Reference  in this Escrow Agreement to the Registration Statement
is  for  identification  purposes  only,  and  its  terms and conditions are not
thereby  incorporated  herein.

     4.   Distribution  and  Release  of  Funds.
          --------------------------------------

          (a) For purposes of this Escrow Agreement, the term "Termination Date"
shall  mean  the  earlier  of:

               (i) ____________, 2004, or such later date set forth in a written
notice purportedly executed by the Corporation and delivered to the Escrow Agent
at  least  five  (5)  Business  Days  prior  to  ___________,  2004.

               (ii)  The  date,  if  any, upon which the Escrow Agent receives a
written notice purportedly executed by the Corporation stating that the offering
has  been  terminated,  or  such  later  date  set  forth  in such notice as the
effective  date  of  such  termination;  or

               (iii) Any date specified by the Corporation in writing, after the
date  the  Escrow Agent has confirmed that it has received in the Escrow Fund at
least  the  Minimum  Funds  in  good,  collected  funds.

          (b)  On  the  Termination  Date, the Escrow Agent shall certify to the
Corporation  in  writing the total amount of collected funds in the Escrow Fund.

          (c)  The  Escrow Agent shall return the funds deposited with it to the
Subscribers  if,  on  the  Termination Date, the Escrow Fund does not consist of
collected  funds  totaling  at  least the Minimum Funds.  The Escrow Agent shall
have  fully  discharged  this  obligation to return Subscribers' funds if it has
mailed  to  each  Subscriber, at the address furnished to it by the Corporation,
the  Underwriter or any selected dealer, by registered or certified mail, return
receipt  requested,  a bank check made payable to each Subscriber for the amount
originally deposited by that Subscriber, plus the Subscriber's pro rata share of
net  interest (defined below) earned without regard to the date the Subscriber's
funds  were  deposited.  For  purposes  of this Escrow Agreement, "net interest"
shall  mean the interest earned on the Escrow Fund, less any fees or expenses of
the  Escrow  Agent  paid  from  the  Escrow  Fund  pursuant  to  Section  5.

          (d)  At  such  time  as (i) the total amount of collected funds in the
Escrow  Fund  equals  at  least the Minimum Funds, and (ii) the Escrow Agent has
received,  on  or  before the Termination Date, written instructions executed by
the  Underwriter  and  the  Corporation,  the  Escrow Agent shall distribute the
entire  Escrow Fund, less commissions, fees and expense reimbursement due to the
Underwriter  and  any  selected  dealers,  pursuant  to  such  instructions. The
commissions,  fees and expense reimbursement due to the Underwriter and selected
broker-dealers  shall  be  set forth in the written instructions, and the Escrow
Agent  shall  distribute  the commissions, fees and expense reimbursement due to
the Underwriter and selected dealers directly to the Underwriter. Subject to the
foregoing,  distributions  may  be made to third parties at the direction of the
Corporation.  Net  interest  earned  on  the  Escrow  Fund  shall be paid to the
Corporation.

          (e)  If  the  Corporation  rejects a subscription for which the Escrow
Agent  has  already  collected  funds,  the  Escrow Agent shall promptly issue a
refund  check  to  the  rejected  Subscriber.  Otherwise, the Escrow Agent shall
promptly  remit  the rejected Subscriber's check directly to the Subscriber. Any
check returned unpaid

                                        3
<PAGE>
to  the Escrow Agent will be returned to the Underwriter or selected dealer that
submitted  the  check. Any check or other form of payment received by the Escrow
Agent  not  payable  to  "CNB  -  Escrow  Intervest"  shall  be  returned to the
Subscriber  by  the  Escrow  Agent.

          (f)  For  purposes  hereof,  "collected  funds"  shall  mean all funds
received  by the Escrow Agent which have cleared normal banking channels and are
in  the form of cash. Furthermore, a check which is not (i) a certified check or
(ii)  a  bank draft or a cashiers check drawn on a bank reasonably acceptable to
the  Escrow  Agent,  shall  constitute "collected funds" only if it has not been
returned  for insufficient funds within ten (10) Business Days after its receipt
by  the  Escrow Agent. No investment profits or losses and no interest earned on
any investments of the Escrow Fund shall be considered for purposes of the above
calculation.

          (g)  It  shall be a condition to the return of funds to any subscriber
hereunder  that  such  subscriber  shall  have  delivered  to the Escrow Agent a
completed  IRS  Form W-9.  The Corporation shall include in the Prospectus which
is  part  of  the  Registration Statement and/or in the subscription forms to be
executed by subscribers, notice of the requirement for delivery of such IRS Form
W-9  as  a  condition  to  the  return of funds deposited in the Escrow Account.

          (h) This Escrow Agreement shall terminate on the final distribution of
the Escrow Fund, at which time the Escrow Agent shall be forever and irrevocably
released  and  discharged  from  any and all further responsibility or liability
with  respect  to  the  Escrow  Fund.

     5.   Compensation.  The Corporation agrees to pay the Escrow Agent a fee of
          -------------
$500 as compensation for its services in connection with establishing the Escrow
Fund,  payable at the time this Escrow Agreement is executed, whether or not any
Debentures  are  sold.  In  addition,  the  Corporation  shall  pay  an  annual
maintenance fee of $100, prorated for the number of months the Escrow Account is
open,  payable  whether  or  not any Debentures are sold.  The Corporation shall
pay,  in  addition  to  the  foregoing  fees,  the  following  charges:

          $1,000.00     Handling  and  processing  fees.
           $   7.50     Per  check  disbursed.
           $  10.00     Per  prorated  net  interest  computation  if  funds are
                        returned  to  investors.
           $  10.00     Per  Form  1099 required to be transmitted by the Escrow
                        Agent.
           $  25.00     Per  check  returned  for  insufficient  funds.
           $  15.00     Per  wire  transfer

Except  for the set-up fee due upon execution of this Escrow Agreement, the fees
and  charges  shall be paid by the Corporation on the date(s) the Escrow Fund is
distributed  pursuant  to  Section  4.  The Escrow Agent shall have the right to
cause any fees due hereunder to be paid out of the interest earned on the Escrow
Account.

     6.   Termination.  This  Escrow Agreement shall terminate no later than the
          ------------
Termination  Date,  or  on such earlier date as the Escrow Agent shall have paid
out  a  total  of at least $12,000,000 in collected funds in accordance with the
provisions  of  this  Escrow  Agreement.

     7.   Resignation  and Removal of Escrow Agent.  The Escrow Agent may at any
          -----------------------------------------
time  resign  and  be  discharged  of the duties and obligations created by this
Escrow  Agreement  by  giving  at  least sixty  (60) days' written notice to the
Corporation  and  the  Underwriter;  the Escrow Agent may be removed at any time
upon  sixty  (60)  days'  notice  by  an  instrument  purportedly  signed  by an
authorized  person of the Corporation and the Underwriter.  Any successor Escrow
Agent  shall  be  appointed and approved by the Corporation and the Underwriter.
Any  such  successor  Escrow  Agent  shall deliver to the  former Escrow Agent a
written  instrument,  acknowledged  by  the  Corporation  and  the  Underwriter,
accepting such appointment hereunder and thereupon it shall take delivery of the
Escrow  Fund  to hold and distribute in accordance with the terms hereof.  If no
successor  Escrow Agent shall have been appointed within thirty  (30) days after
the  Corporation  and  the  Underwriter  are  notified  of  the  Escrow  Agent's
resignation, the Escrow Agent shall return the Escrow Fund to the Subscribers in
accordance  with  the procedure set forth in Section 4(c).  Upon the delivery of
the  Escrow  Fund  in  accordance with this Section 7, the Escrow Agent shall be
discharged  from  any  further  duties  hereunder.

                                        4
<PAGE>
     8.   Binding Effect.  This Escrow Agreement shall be binding upon and inure
          ---------------
to  the  benefit  of  the  parties,  their  successors  and  assigns.

     9.   Headings.  The  headings  contained  in  this  Escrow  Agreement  are
          ---------
intended  for  convenience  and shall not in any way determine the rights of the
parties  to  this  Escrow  Agreement.

     10.  Waiver.  Waiver of any terms or conditions of this Escrow Agreement by
          -------
any  party  shall  not  be  construed  as (a) a waiver of a subsequent breach or
failure  of  the  same  term  or condition, or (b) a waiver of any other term or
condition  of  this  Escrow  Agreement.

     11.  Counterparts.  This  Escrow  Agreement  may be executed in one or more
          -------------
counterparts,  each  of  which  shall be deemed an original, and it shall not be
necessary  in  making  proof  of this Escrow Agreement to produce or account for
more  than  one  such  counterpart.

     12.  Modification.  This  Escrow Agreement constitutes the entire agreement
          -------------
between  the  parties  as  to the escrow of Subscribers' funds, and shall not be
modified  except  in  writing  signed  and  acknowledged  by  all  the  parties.

     13.  Notices.  All notices and communications hereunder shall be in writing
          --------
and  shall be deemed to be duly given on the date delivered by the United States
Mail, registered or certified mail, return receipt requested, postage prepaid to
the  address  of  the Corporation and Underwriter as first above written, and to
the  Escrow  Agent  at  1150  Pittsford-Victor  Road, Pittsford, New York 14534,
Attention:  Sharon  Greisberger, Vice President, provided, however, that notices
may  be given by telex,  cable, telecopier, courier service, telephone, personal
delivery  or  otherwise, effective the date of such communication, provided that
notices  given  by  such  means  of  communications  are  confirmed  by  mail as
aforesaid,  postmarked  within  one  business  day  after  such  other  form  of
communication.

     14.  Governing  Law.  This Escrow Agreement shall be construed and enforced
          ---------------
in accordance with the laws of the State of New York. The parties consent to the
personal  jurisdiction  of  all  courts of the State of New York, and agree that
such  jurisdiction  shall  be  exclusive.

     IN  WITNESS  WHEREOF,  the  parties have executed and delivered this Escrow
Agreement  as  of  the  date  and  year  first  above  written.

CORPORATION:               INTERVEST  MORTGAGE  CORPORATION

                           By:      ________________________________________
                           Its:     ________________________________________

ESCROW  AGENT:             CANANDAIGUA  NATIONAL  BANK  AND  TRUST  COMPANY

                           By:      _______________________________________
                           Its:     _______________________________________

UNDERWRITER:               SAGE,  RUTTY  &  CO.,  INC.

                           By:      ______________________________________
                           Its:     ______________________________________

                                        5
<PAGE><PAGE>

                                                                    EXHIBIT 10.1

                          SECURITIES PURCHASE AGREEMENT

         SECURITIES PURCHASE AGREEMENT (this "AGREEMENT"), dated as of June 24,
2004, by and among VisiJet, Inc., a Delaware corporation, with headquarters
located at 192 Technology Drive, Suite Q, Irvine, California 92618 (the
"COMPANY"), and each of the purchasers set forth on the signature pages hereto
(the "BUYERS").

         WHEREAS:

         A. The Company and the Buyers are executing and delivering this
Agreement in reliance upon the exemption from securities registration afforded
by the rules and regulations as promulgated by the United States Securities and
Exchange Commission (the "SEC") under the Securities Act of 1933, as amended
(the "1933 ACT");

         B. Buyers desire to purchase and the Company desires to issue and sell,
upon the terms and conditions set forth in this Agreement (i) 8% senior
convertible debentures of the Company, in the form attached hereto as EXHIBIT
"A", in the aggregate principal amount of One Million Dollars ($1,000,000)
(together with any debenture(s) issued in replacement thereof or as a dividend
thereon or otherwise with respect thereto in accordance with the terms thereof,
the "DEBENTURES"), convertible into shares of common stock, par value $0.001 per
share, of the Company (the "COMMON STOCK"), upon the terms and subject to the
limitations and conditions set forth in such Debentures, (ii) warrants, in the
form attached hereto as EXHIBIT "B-1" and EXHIBIT "B-2", to purchase 750,000
shares of Common Stock (the "WARRANTS"), and (iii) 150,000 shares of Common
Stock (the "ADDITIONAL SHARES").

         C. Each Buyer wishes to purchase, upon the terms and conditions stated
in this Agreement, such principal amount of Debentures and number of Warrants
and Additional Shares as is set forth immediately below its name on the
signature pages hereto;

         D. Contemporaneous with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Registration Rights Agreement,
in the form attached hereto as EXHIBIT "C" (the "REGISTRATION RIGHTS
AGREEMENT"), pursuant to which the Company has agreed to provide certain
registration rights under the 1933 Act and the rules and regulations promulgated
thereunder, and applicable state securities laws; and

         E. Contemporaneous with the execution and delivery of this Agreement,
the parties hereto are executing and delivering a Pledge and Escrow Agreement,
in the form attached hereto as EXHIBIT "D" (the "PLEDGE AND ESCROW AGREEMENT"),
pursuant to which the Company has pledged certain of its securities to secure
the obligations under the Debentures and this Agreement.

         NOW THEREFORE, the Company and each of the Buyers severally (and not
jointly) hereby agree as follows:

         1. PURCHASE AND SALE OF NOTES AND WARRANTS.

                  a. PURCHASE OF DEBENTURES, WARRANTS AND ADDITIONAL SHARES. On
the Closing Date (as defined below), the Company shall issue and sell to each
Buyer and each Buyer severally agrees to purchase from the Company such
principal amount of Debentures and number of Warrants and Additional Shares as
is set forth immediately below such Buyer's name on the signature pages hereto.

<PAGE>

                  b. FORM OF PAYMENT. On the Closing Date (as defined below),
(i) each Buyer shall pay the purchase price for the Debentures, the Warrants and
the Additional Shares to be issued and sold to it at the Closing (as defined
below) (the "PURCHASE PRICE") by wire transfer of immediately available funds to
the Company, in accordance with the Company's written wiring instructions,
against delivery of the Debentures in the principal amount equal to the Purchase
Price and the number of Warrants and Additional Shares as is set forth
immediately below such Buyer's name on the signature pages hereto, and (ii) the
Company shall deliver such Debentures, Warrants and the Additional Shares duly
executed on behalf of the Company, to such Buyer, against delivery of such
Purchase Price.

                  c. CLOSING DATE. Subject to the satisfaction (or written
waiver) of the conditions thereto set forth in Section 5 and Section 6 below,
the date and time of the issuance and sale of the Debentures, the Warrants and
the Additional Shares pursuant to this Agreement (the "CLOSING DATE") shall be
12:00 noon, Eastern Standard Time on June 24, 2004, or such other mutually
agreed upon time. The closing of the transactions contemplated by this Agreement
(the "CLOSING") shall occur on the Closing Date at such location as may be
agreed to by the parties.

         2. BUYERS' REPRESENTATIONS AND WARRANTIES. Each Buyer severally (and
not jointly) represents and warrants to the Company solely as to such Buyer
that:

                  a. INVESTMENT PURPOSE. As of the date hereof, the Buyer is
purchasing the Additional Shares, the Debentures and the shares of Common Stock
issuable upon conversion of or otherwise pursuant to the Debentures pursuant to
this Agreement, such shares of Common Stock being collectively referred to
herein as the "CONVERSION SHARES") and the Warrants and the shares of Common
Stock issuable upon exercise thereof (the "WARRANT SHARES" and, collectively
with the Additional Shares, Debentures, Warrants and Conversion Shares, the
"SECURITIES") for its own account and not with a present view towards the public
sale or distribution thereof, except pursuant to sales registered or exempted
from registration under the 1933 Act; PROVIDED, HOWEVER, that by making the
representations herein, the Buyer does not agree to hold any of the Securities
for any minimum or other specific term and reserves the right to dispose of the
Securities at any time in accordance with or pursuant to a registration
statement or an exemption under the 1933 Act.

                  b. ACCREDITED INVESTOR STATUS. The Buyer is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D (an "ACCREDITED
INVESTOR").

                  c. RELIANCE ON EXEMPTIONS. The Buyer understands that the
Securities are being offered and sold to it in reliance upon specific exemptions
from the registration requirements of United States federal and state securities
laws and that the Company is relying upon the truth and accuracy of, and the
Buyer's compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Buyer set forth herein in order to
determine the availability of such exemptions and the eligibility of the Buyer
to acquire the Securities.

                  d. INFORMATION. The Buyer and its advisors, if any, have been
furnished with all information relating to the business, finances and operations
of the Company and information relating to the offer and sale of the Securities
which have been requested by the Buyer or its advisors; PROVIDED, HOWEVER, that
the Buyer is relying on the Company's representation that all such information
which would otherwise constitute material nonpublic information has been
disclosed to the public prior to or promptly following such disclosure to the
Buyer. Neither such inquiries nor any other due diligence investigation
conducted by Buyer or any of its advisors or representatives shall modify, amend
or affect Buyer's right to rely on the Company's representations and warranties
contained in Section 3 below. The Buyer understands that its investment in the
Securities involves a significant degree of risk.

                                       2

<PAGE>

                  e. GOVERNMENTAL REVIEW. The Buyer understands that no United
States federal or state agency or any other government or governmental agency
has passed upon or made any recommendation or endorsement of the Securities.

                  f. TRANSFER OR RE-SALE. The Buyer understands that except as
provided in the Registration Rights Agreement, the sale or re-sale of the
Securities has not been and is not being registered under the 1933 Act or any
applicable state securities laws, and the Securities may not be transferred
unless (a) the Securities are sold pursuant to an effective registration
statement under the 1933 Act, (b) the Buyer shall have delivered to the Company
an opinion of counsel that shall be in form, substance and scope customary for
opinions of counsel in comparable transactions to the effect that the Securities
to be sold or transferred may be sold or transferred pursuant to an exemption
from such registration, which opinion shall be accepted by the Company, (c) the
Securities are sold or transferred to an "affiliate" (as defined in Rule 144
promulgated under the 1933 Act (or a successor rule) ("RULE 144")) of the Buyer
who agrees to sell or otherwise transfer the Securities only in accordance with
this Section 2(f) and who is an Accredited Investor, (d) the Securities are sold
pursuant to Rule 144, or (e) the Securities are sold pursuant to Regulation S
under the 1933 Act (or a successor rule) ("REGULATION S"), and the Buyer shall
have delivered to the Company an opinion of counsel that shall be in form,
substance and scope customary for opinions of counsel in corporate transactions,
which opinion shall be accepted by the Company. Notwithstanding the foregoing or
anything else contained herein to the contrary, the Securities may be pledged as
collateral in connection with a BONA FIDE margin account or other lending
arrangement.

                  g. LEGENDS. The Buyer understands that the Debentures and the
Warrants and, until such time as the Additional Shares, Conversion Shares and
Warrant Shares have been registered under the 1933 Act as contemplated by the
Registration Rights Agreement or otherwise may be sold pursuant to Rule 144 or
Regulation S without any restriction as to the number of securities as of a
particular date that can then be immediately sold, the Additional Shares,
Conversion Shares and Warrant Shares may bear a restrictive legend in
substantially the following form (and a stop-transfer order may be placed
against transfer of the certificates for such Securities):

                  "The securities represented by this certificate have not been
                  registered under the Securities Act of 1933, as amended. The
                  securities may not be sold, transferred or assigned in the
                  absence of an effective registration statement for the
                  securities under said Act, or an opinion of counsel, in form,
                  substance and scope customary for opinions of counsel in
                  comparable transactions, that registration is not required
                  under said Act or unless sold pursuant to Rule 144 or
                  Regulation S under said Act."

                  h. AUTHORIZATION; ENFORCEMENT. This Agreement has been duly
and validly authorized by, and duly executed and delivered on behalf of, the
Buyer, and this Agreement constitutes the valid and binding agreement of the
Buyer enforceable in accordance with its terms.

                  i. RESIDENCY. The Buyer is a resident of the jurisdiction set
forth immediately below such Buyer's name on the signature pages hereto.

                                       3

<PAGE>

         3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. Except as set forth
in the Company's Disclosure Schedule annexed hereto, the Company represents and
warrants to each Buyer that:

                  a. ORGANIZATION AND QUALIFICATION. The Company and each of its
Subsidiaries (as defined below), if any, is a corporation or other entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated or organized, with full power and
authority (corporate and other) to own, lease, use and operate its properties
and to carry on its business as and where now owned, leased, used, operated and
conducted. The Company and each of its Subsidiaries is duly qualified as a
foreign corporation to do business and is in good standing in every jurisdiction
in which its ownership or use of property or the nature of the business
conducted by it makes such qualification necessary except where the failure to
be so qualified or in good standing would not have a Material Adverse Effect.
"MATERIAL ADVERSE EFFECT" means any material adverse effect on the business,
operations, assets, financial condition or prospects of the Company or its
Subsidiaries, if any, taken as a whole, or on the transactions contemplated
hereby or by the agreements or instruments to be entered into in connection
herewith. "SUBSIDIARIES" means any corporation or other organization, whether
incorporated or unincorporated, in which the Company owns, directly or
indirectly, any equity or other ownership interest.

                  b. AUTHORIZATION; ENFORCEMENT. The Company has all requisite
corporate power and authority to enter into and perform this Agreement, the
Registration Rights Agreement, the Pledge and Escrow Agreement, the Debentures
and the Warrants and to consummate the transactions contemplated hereby and
thereby and to issue the Securities, in accordance with the terms hereof and
thereof. The execution and delivery of this Agreement, the Registration Rights
Agreement, the Pledge and Escrow Agreement, the Debentures and the Warrants by
the Company and the consummation by it of the transactions contemplated hereby
and thereby (including without limitation, the issuance of the Additional
Shares, Debentures and the Warrants and the issuance and reservation for
issuance of the Conversion Shares and Warrant Shares issuable upon conversion or
exercise thereof) have been duly authorized by the Company's Board of Directors
and no further consent or authorization of the Company, its Board of Directors,
or its stockholders is required. This Agreement has been duly executed and
delivered by the Company by its authorized representative, and such authorized
representative is the true and official representative with authority to sign
this Agreement and the other documents executed in connection herewith and bind
the Company accordingly. This Agreement constitutes, and upon execution and
delivery by the Company of the Registration Rights Agreement, the Pledge and
Escrow Agreement, the Debentures and the Warrants, each of such instruments will
constitute, a legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms.

                  c. CAPITALIZATION. As of the date hereof, the authorized
capital stock of the Company consists of (i) 50,000,000 shares of Common Stock,
of which 27,334,663 shares are issued and outstanding, 14,047,480 shares are
reserved for issuance pursuant to securities (other than the Debentures and the
Warrants) exercisable for, or convertible into or exchangeable for shares of
Common Stock; and (ii) 10,000,000 shares of preferred stock, of which no series
or class has been designated and no shares are issued and outstanding. All of
such outstanding shares of capital stock are, or upon issuance will be, duly
authorized, validly issued, fully paid and nonassessable. No shares of capital
stock of the Company are subject to preemptive rights or any other similar
rights of the shareholders of the Company or any liens or encumbrances imposed
through the actions or failure to act of the Company. As of the date of this
Agreement, (i) there are no outstanding options, warrants, scrip, rights to
subscribe for, puts, calls, rights of first refusal, agreements, understandings,
claims or other commitments or rights of any character whatsoever relating to,

                                       4

<PAGE>

or securities or rights convertible into or exchangeable for any shares of
capital stock of the Company or any of its Subsidiaries, or arrangements by
which the Company or any of its Subsidiaries is or may become bound to issue
additional shares of capital stock of the Company or any of its Subsidiaries,
(ii) there are no agreements or arrangements under which the Company or any of
its Subsidiaries is obligated to register the sale of any of its or their
securities under the 1933 Act (except the Registration Rights Agreement) and
(iii) there are no anti-dilution or price adjustment provisions contained in any
security issued by the Company (or in any agreement providing rights to security
holders) that will be triggered by the issuance of the Debentures, the Warrants,
the Additional Shares or the Conversion Shares or Warrant Shares.

                  d. ISSUANCE OF SHARES. The Conversion Shares and Warrant
Shares are duly authorized and reserved for issuance and, upon conversion of the
Debentures and exercise of the Warrants in accordance with their respective
terms, will be validly issued, fully paid and non-assessable, and free from all
taxes, liens, claims and encumbrances with respect to the issue thereof and
shall not be subject to preemptive rights or other similar rights of
stockholders of the Company and will not impose personal liability upon the
holder thereof. The Additional Shares are duly authorized and, when issued
pursuant to this Agreement will be validly issued, fully paid and
non-assessable, and free from all taxes, liens, claims and encumbrances with
respect to the issue thereof and shall not be subject to preemptive rights or
other similar rights of stockholders of the Company and will not impose personal
liability upon the holder thereof.

                  e. ACKNOWLEDGMENT OF DILUTION. The Company understands and
acknowledges the potentially dilutive effect to the Common Stock upon the
issuance of the Conversion Shares and Warrant Shares upon conversion of the
Debenture or exercise of the Warrants. The Company further acknowledges that its
obligation to issue Conversion Shares and Warrant Shares upon conversion of the
Debentures or exercise of the Warrants in accordance with this Agreement, the
Debentures and the Warrants is absolute and unconditional regardless of the
dilutive effect that such issuance may have on the ownership interests of other
shareholders of the Company.

                  f. NO CONFLICTS. The execution, delivery and performance of
this Agreement, the Registration Rights Agreement, the Pledge and Escrow
Agreement, the Debentures and the Warrants by the Company and the consummation
by the Company of the transactions contemplated hereby and thereby (including,
without limitation, the issuance of the Additional Shares and the issuance and
reservation for issuance of the Conversion Shares and Warrant Shares) will not
(i) conflict with or result in a violation of any provision of the certificate
of incorporation, as amended, (the "CERTIFICATE OF INCORPORATION") of the
Company or the by-laws, as amended, (the "BY-LAWS") of the Company, or (ii)
violate or conflict with, or result in a breach of any provision of, or
constitute a default (or an event which with notice or lapse of time or both
could become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture, patent,
patent license or instrument to which the Company or any of its Subsidiaries is
a party, or (iii) result in a violation of any law, rule, regulation, order,
judgment or decree (including federal and state securities laws and regulations
and regulations of any self-regulatory organizations to which the Company or its
securities are subject) 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 for such conflicts, defaults, terminations,
amendments, accelerations, cancellations and violations as would not,
individually or in the aggregate, have a Material Adverse Effect). Neither the
Company nor any of its Subsidiaries is in violation of its Certificate of
Incorporation, By-laws or other organizational documents and neither the Company
nor any of its Subsidiaries is in default (and no event has occurred which with
notice or lapse of time or both could put the Company or any of its Subsidiaries
in default) under, and neither the Company nor any of its Subsidiaries has taken
any action or failed to take any action that would 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 by which any property or assets of the Company or any of its
Subsidiaries is bound or affected, except for possible defaults as would not,
individually or in the aggregate, have a Material Adverse Effect. The businesses

                                       5

<PAGE>

of the Company and its Subsidiaries, if any, are not being conducted, and shall
not be conducted so long as a Buyer owns any of the Securities, in violation of
any law, ordinance or regulation of any governmental entity. Except as
specifically contemplated by this Agreement and as required under the 1933 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, governmental agency, regulatory agency, self regulatory organization
or stock market or any third party in order for it to execute, deliver or
perform any of its obligations under this Agreement, the Registration Rights
Agreement, the Pledge and Escrow Agreement, the Debentures or the Warrants in
accordance with the terms hereof or thereof or to issue and sell the Additional
Shares, Debentures and Warrants in accordance with the terms hereof and to issue
the Conversion Shares upon conversion of the Debentures and the Warrant Shares
upon exercise of the Warrants. 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 is not in violation of the listing requirements of the Over-the-Counter
Bulletin Board (the "OTCBB") and does not reasonably anticipate that the Common
Stock will be delisted by the OTCBB in the foreseeable future. The Company and
its Subsidiaries are unaware of any facts or circumstances which might give rise
to any of the foregoing.

                  g. SEC DOCUMENTS; FINANCIAL STATEMENTS. The Company has timely
filed all reports, schedules, forms, statements and other documents required to
be filed by it with the SEC pursuant to the reporting requirements of the
Securities Exchange Act of 1934, as amended (the "1934 ACT") (all of the
foregoing filed prior to the date hereof and all exhibits included therein and
financial statements and schedules thereto and documents (other than exhibits to
such documents) incorporated by reference therein, being hereinafter referred to
herein as the "SEC DOCUMENTS"). The Company has delivered to each Buyer true and
complete copies of the SEC Documents, except for such exhibits and incorporated
documents. As of their respective dates, the SEC Documents complied in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the SEC promulgated thereunder applicable to the SEC Documents,
and none of the SEC Documents, at the time they were filed with the SEC,
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. None of the statements made in any such SEC Documents is, or has
been, required to be amended or updated under applicable law (except for such
statements as have been amended or updated in subsequent filings prior the date
hereof). As of their respective dates, the financial statements of the Company
included in the SEC Documents 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 United States 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 not include
footnotes or may be condensed or summary statements) and fairly present in all
material respects the consolidated financial position of the Company and its
consolidated Subsidiaries as of the dates thereof and the consolidated results
of their operations and cash flows for the periods then ended (subject, in the
case of unaudited statements, to normal year-end audit adjustments). Except as
set forth in the financial statements of the Company included in the SEC
Documents, the Company has no liabilities, contingent or otherwise, other than
(i) liabilities incurred in the ordinary course of business subsequent to
December 31, 2003 and (ii) obligations under contracts and commitments incurred
in the ordinary course of business and not required under generally accepted
accounting principles to be reflected in such financial statements, which,
individually or in the aggregate, are not material to the financial condition or
operating results of the Company.

                                       6

<PAGE>

                  h. ABSENCE OF CERTAIN CHANGES. Since December 31, 2003, there
has been no material adverse change and no material adverse development in the
assets, liabilities, business, properties, operations, financial condition,
results of operations or prospects of the Company or any of its Subsidiaries.

                  i. ABSENCE OF LITIGATION. There is no action, suit, claim,
proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending or, to the
knowledge of the Company or any of its Subsidiaries, threatened against or
affecting the Company or any of its Subsidiaries, or their officers or directors
in their capacity as such, that could have a Material Adverse Effect. The
Company and its Subsidiaries are unaware of any facts or circumstances which
might give rise to any of the foregoing.

                  j. PATENTS, COPYRIGHTS, ETC. The Company and each of its
Subsidiaries owns or possesses the requisite licenses or rights to use all
patents, patent applications, patent rights, inventions, know-how, trade
secrets, trademarks, trademark applications, service marks, service names, trade
names and copyrights ("INTELLECTUAL PROPERTY") necessary to enable it to conduct
its business as now operated (and, to the Company's knowledge, as presently
contemplated to be operated in the future); there is no claim or action by any
person pertaining to, or proceeding pending, or to the Company's knowledge
threatened, which challenges the right of the Company or of a Subsidiary with
respect to any Intellectual Property necessary to enable it to conduct its
business as now operated (and, to the Company's knowledge, as presently
contemplated to be operated in the future); to the Company's knowledge, the
Company's or its Subsidiaries' current and intended products, services and
processes do not infringe on any Intellectual Property or other rights held by
any person; and the Company is unaware of any facts or circumstances which might
give rise to any of the foregoing.

                  k. NO MATERIALLY ADVERSE CONTRACTS, ETC. 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. Neither the Company nor any of its Subsidiaries is a
party to any contract or agreement which in the judgment of the Company's
officers has or is expected to have a Material Adverse Effect.

                  l. TAX STATUS. The Company and each of its Subsidiaries has
made or filed all federal, state and foreign income and all other tax returns,
reports and declarations required by any jurisdiction to which it is subject
(unless and only to the extent that the Company and each of its Subsidiaries has
set aside on its books provisions reasonably adequate for the payment of all
unpaid and unreported taxes) and has paid all taxes and other 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 provisions 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. The Company
has not executed a waiver with respect to the statute of limitations relating to
the assessment or collection of any foreign, federal, state or local tax. None
of the Company's tax returns is presently being audited by any taxing authority.

                  m. CERTAIN TRANSACTIONS. Except for arm's length transactions
pursuant to which the Company or any of its Subsidiaries makes payments in the
ordinary course of business upon terms no less favorable than the Company or any
of its Subsidiaries could obtain from third parties, none of the officers,
directors, or employees of the Company is presently a party to any transaction
with the Company or any of its Subsidiaries (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.

                                       7

<PAGE>

                  n. PERMITS; COMPLIANCE. The Company and each of its
Subsidiaries is in possession of all franchises, grants, authorizations,
licenses, permits, easements, variances, exemptions, consents, certificates,
approvals and orders necessary to own, lease and operate its properties and to
carry on its business as it is now being conducted (collectively, the "COMPANY
PERMITS"), and there is no action pending or, to the knowledge of the Company,
threatened regarding suspension or cancellation of any of the Company Permits.
Neither the Company nor any of its Subsidiaries is in conflict with, or in
default or violation of, any of the Company Permits, except for any such
conflicts, defaults or violations which, individually or in the aggregate, would
not reasonably be expected to have a Material Adverse Effect. Since December 31,
2003, neither the Company nor any of its Subsidiaries has received any
notification with respect to possible conflicts, defaults or violations of
applicable laws, except for notices relating to possible conflicts, defaults or
violations, which conflicts, defaults or violations would not have a Material
Adverse Effect.

                  o. ENVIRONMENTAL MATTERS. There are, with respect to the
Company or any of its Subsidiaries, no past or present violations of
Environmental Laws (as defined below), releases of any material into the
environment, actions, activities, circumstances, conditions, events, incidents,
or contractual obligations which may give rise to any common law environmental
liability or any liability under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 or similar federal, state, local or
foreign laws and neither the Company nor any of its Subsidiaries has received
any notice with respect to any of the foregoing, nor is any action pending or,
to the Company's knowledge, threatened in connection with any of the foregoing.
The term "ENVIRONMENTAL LAWS" means all federal, state, local or foreign laws
relating to pollution or protection of human health or the environment
(including, without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata), including, without limitation, laws relating to
emissions, discharges, releases or threatened releases of chemicals, pollutants
contaminants, or toxic or hazardous substances or wastes (collectively,
"HAZARDOUS MATERIALS") into the environment, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials, as well as all authorizations,
codes, decrees, demands or demand letters, injunctions, judgments, licenses,
notices or notice letters, orders, permits, plans or regulations issued,
entered, promulgated or approved thereunder. Other than those that are or were
stored, used or disposed of in compliance with applicable law, no Hazardous
Materials are contained on or about any real property currently owned, leased or
used by the Company or any of its Subsidiaries, and no Hazardous Materials were
released on or about any real property previously owned, leased or used by the
Company or any of its Subsidiaries during the period the property was owned,
leased or used by the Company or any of its Subsidiaries, except in the normal
course of the Company's or any of its Subsidiaries' business. There are no
underground storage tanks on or under any real property owned, leased or used by
the Company or any of its Subsidiaries that are not in compliance with
applicable law.

                  p. TITLE TO PROPERTY. The Company and its Subsidiaries have
good and marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them which is material to the
business of the Company and its Subsidiaries, in each case free and clear of all
liens, encumbrances and defects except such as would not have a Material Adverse
Effect. 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 would not have a Material Adverse Effect.

                                       8

<PAGE>

                  q. 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 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 have a Material Adverse Effect.

                  r. INTERNAL ACCOUNTING CONTROLS. The Company and each of its
Subsidiaries maintain a system of internal accounting controls sufficient, in
the judgment of the Company's board of directors, 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, (iii)
access to assets is permitted only in accordance with management's general or
specific authorization and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.

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

                  t. SOLVENCY. The Company (after giving effect to the
transactions contemplated by this Agreement) is solvent (I.E., its assets have a
fair market value in excess of the amount required to pay its probable
liabilities on its existing debts as they become absolute and matured) and
currently the Company has no information that would lead it to reasonably
conclude that the Company would not, after giving effect to the transaction
contemplated by this Agreement, have the ability to, nor does it intend to take
any action that would impair its ability to, pay its debts from time to time
incurred in connection therewith as such debts mature.

                  u. NO INVESTMENT COMPANY. The Company is not, and upon the
issuance and sale of the Securities as contemplated by this Agreement will not
be an "investment company" as defined under the Investment Company Act of 1940
(an "INVESTMENT COMPANY"). The Company is not controlled by an Investment
Company.

                  v. DISCLOSURE. All information relating to or concerning the
Company or any of its Subsidiaries set forth in this Agreement and provided to
the Buyers in connection with the transactions contemplated hereby is true and
correct in all material respects and the Company has not omitted to state any
material fact necessary in order to make the statements made herein or therein,
in light of the circumstances under which they were made, not misleading. No
event or circumstance has occurred or exists with respect to the Company or any
of its Subsidiaries or its or their business, properties, prospects, operations
or financial conditions, which, under applicable law, rule or regulation,
requires public disclosure or announcement by the Company but which has not been
so publicly announced or disclosed.

                                       9

<PAGE>

                  w. ACKNOWLEDGMENT REGARDING BUYERS' PURCHASE OF SECURITIES.
The Company acknowledges and agrees that the Buyers are acting solely in the
capacity of arm's length purchasers with respect to this Agreement and the
transactions contemplated hereby. The Company further acknowledges that no Buyer
is 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 statement made by any Buyer or any of their respective
representatives or agents in connection with this Agreement and the transactions
contemplated hereby is not advice or a recommendation and is merely incidental
to the Buyers' purchase of the Securities. The Company further represents to
each Buyer that the Company's decision to enter into this Agreement has been
based solely on the independent evaluation of the Company and its
representatives.

                  x. 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 in any security or solicited any offers to
buy any security under circumstances that would require registration under the
1933 Act of the issuance of the Securities to the Buyers. The issuance of the
Securities to the Buyers will not be integrated with any other issuance of the
Company's securities (past, current or future) for purposes of any stockholder
approval provisions applicable to the Company or its securities.

                  y. NO BROKERS. The Company has taken no action which would
give rise to any claim by any person for brokerage commissions, transaction fees
or similar payments relating to this Agreement or the transactions contemplated
hereby.

         4. COVENANTS.

                  a. BEST EFFORTS. The parties shall use their best efforts to
satisfy timely each of the conditions described in Section 5 and 6 of this
Agreement.

                  b. FORM D; BLUE SKY LAWS. The Company agrees to file a Form D
with respect to the Securities 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 Securities for sale to the Buyers at the
applicable closing pursuant to this Agreement under applicable securities or
"blue sky" laws of the states of the United States (or to obtain an exemption
from such qualification), and shall provide evidence of any such action so taken
to each Buyer on or prior to the Closing Date.

                  c. USE OF PROCEEDS. The Company shall not, directly or
indirectly, use the proceeds from the sale of the Debentures, Warrants and
Additional Shares for any loan to or investment in any other corporation,
partnership, enterprise or other person (except in connection with its currently
existing direct or indirect Subsidiaries).

                  d. EXPENSES. At the Closing, the Company shall reimburse
Buyers for expenses incurred by them in connection with the negotiation,
preparation, execution, delivery and performance of this Agreement and the other
agreements to be executed in connection herewith ("Documents"), including,
without limitation, attorneys' and consultants' fees and expenses, transfer
agent fees, fees for stock quotation services, fees relating to any amendments
or modifications of the Documents or any consents or waivers of provisions in
the Documents, fees for the preparation of opinions of counsel, escrow fees, and
costs of restructuring the transactions contemplated by the Documents, not to
exceed $20,000. When possible, the Company must pay these fees directly,
otherwise the Company must make immediate payment for reimbursement to the
Buyers for all fees and expenses immediately upon written notice by the Buyer or
the submission of an invoice by the Buyer If the Company fails to reimburse the
Buyer in full within three (3) business days of the written notice or submission
of invoice by the Buyer, the Company shall pay interest on the total amount of
fees to be reimbursed at a rate of 15% per annum.

                                       10

<PAGE>
                  e. FINANCIAL INFORMATION. The Company agrees to send, or make
available on EDGAR, the following reports to each Buyer until such Buyer
transfers, assigns, or sells all of the Securities: (i) within ten (10) days
after the filing with the SEC, a copy of its Annual Report on Form 10-KSB its
Quarterly Reports on Form 10-QSB and any Current Reports on Form 8-K; (ii)
within one (1) day after release, copies of all press releases issued by the
Company or any of its Subsidiaries; and (iii) contemporaneously with the making
available or giving to the shareholders of the Company, copies of any notices or
other information the Company makes available or gives to such shareholders.

                  f. AUTHORIZATION AND RESERVATION OF SHARES. The Company shall
at all times have authorized, and reserved for the purpose of issuance, a
sufficient number of shares of Common Stock to provide for the full conversion
or exercise of the outstanding Debentures and Warrants and issuance of the
Conversion Shares and Warrant Shares in connection therewith (based on the
Conversion Price of the Debentures or Exercise Price of the Warrants in effect
from time to time) and as otherwise required by the Debentures. The Company
shall not reduce the number of shares of Common Stock reserved for issuance upon
conversion of Debentures and exercise of the Warrants without the consent of
each Buyer. The Company shall at all times maintain the number of shares of
Common Stock so reserved for issuance at an amount ("RESERVED AMOUNT") equal to
no less than two (2) times the number that is then actually issuable upon full
conversion of the Debentures and upon exercise of the Warrants (based on the
Conversion Price of the Debentures or the Exercise Price of the Warrants in
effect from time to time). If at any time the number of shares of Common Stock
authorized and reserved for issuance ("AUTHORIZED AND RESERVED SHARES") is below
the Reserved Amount, the Company will promptly take all corporate action
necessary to authorize and reserve a sufficient number of shares, including,
without limitation, calling a special meeting of stockholders to authorize
additional shares to meet the Company's obligations under this Section 4(f), in
the case of an insufficient number of authorized shares, obtain stockholder
approval of an increase in such authorized number of shares, and voting the
management shares of the Company in favor of an increase in the authorized
shares of the Company to ensure that the number of authorized shares is
sufficient to meet the Reserved Amount.

                  g. LISTING. The Company shall promptly secure the listing of
the Additional Shares, Conversion Shares and Warrant Shares upon each national
securities exchange or automated quotation system, if any, upon which shares of
Common Stock are then listed (subject to official notice of issuance) and, so
long as any Buyer owns any of the Securities, shall maintain, so long as any
other shares of Common Stock shall be so listed, such listing of all Additional
Shares and the Conversion Shares and Warrant Shares from time to time issuable
upon conversion of the Debentures or exercise of the Warrants. The Company will
obtain and, so long as any Buyer owns any of the Securities, maintain the
listing and trading of its Common Stock on the OTCBB or any equivalent
replacement exchange, the Nasdaq National Market ("NASDAQ"), the Nasdaq SmallCap
Market ("NASDAQ SMALLCAP"), the New York Stock Exchange ("NYSE"), or the
American Stock Exchange ("AMEX") and will comply in all respects with the
Company's reporting, filing and other obligations under the bylaws or rules of
the National Association of Securities Dealers ("NASD") and such exchanges, as
applicable. The Company shall promptly provide to each Buyer copies of any
notices it receives from the OTCBB and any other exchanges or quotation systems
on which the Common Stock is then listed regarding the continued eligibility of
the Common Stock for listing on such exchanges and quotation systems.

                                       11

<PAGE>

                  h. CORPORATE EXISTENCE. So long as a Buyer beneficially owns
any Debentures or Warrants, the Company shall maintain its corporate existence
and shall not sell all or substantially all of the Company's assets, except in
the event of a merger or consolidation or sale of all or substantially all of
the Company's assets, where the surviving or successor entity in such
transaction (i) assumes the Company's obligations hereunder and under the
agreements and instruments entered into in connection herewith and (ii) is a
publicly traded corporation whose Common Stock is listed for trading on the
OTCBB, Nasdaq, Nasdaq SmallCap, NYSE or AMEX.

                  i. NO INTEGRATION. The Company shall not make any offers or
sales of any security (other than the Securities) under circumstances that would
require registration of the Securities being offered or sold hereunder under the
1933 Act or cause the offering of the Securities to be integrated with any other
offering of securities by the Company for the purpose of any stockholder
approval provision applicable to the Company or its securities.

                  j. RESTRICTION ON SHORT SALES. The Buyers agree that, so long
as any of the Debentures remain outstanding, the Buyers will not enter into or
effect any "short sale" (as such term is defined in Rule 3b-3 of the 1934 Act)
of the Common Stock or hedging transaction which establishes a net short portion
with respect to the Common Stock.

                  k. ADDITIONAL ISSUANCES. Until the Company has filed with the
SEC a Registration Statement registering the resale of the Registrable
Securities (as such terms are defined in the Registration Rights Agreement) in
accordance with the Registration Rights Agreement, the Company shall not issue
any of its Common Stock, nor issue any other security convertible or
exchangeable for, or exercisable into, Common Stock, nor enter into any
agreement to do any of the foregoing.

         5. CONDITIONS TO THE COMPANY'S OBLIGATION TO SELL. The obligation of
the Company hereunder to issue and sell the Debentures, Warrants and Additional
Shares to a Buyer at the Closing is subject to the satisfaction, at or before
the Closing Date of each of the following conditions thereto, 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:

                  a. The applicable Buyer shall have executed this Agreement,
the Registration Rights Agreement and the Pledge and Escrow Agreement, and
delivered the same to the Company.

                  b. The applicable Buyer shall have delivered the Purchase
Price in accordance with Section 1(b) above.

                  c. The representations and warranties of the applicable Buyer
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 applicable Buyer 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 applicable Buyer at or prior to the Closing
Date.

                  d. No litigation, statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by or in any court or governmental authority of competent jurisdiction
or any self-regulatory organization having authority over the matters
contemplated hereby which prohibits the consummation of any of the transactions
contemplated by this Agreement.

         6. CONDITIONS TO EACH BUYER'S OBLIGATION TO PURCHASE. The obligation of
each Buyer hereunder to purchase the Debentures, Warrants and Additional Shares
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 such
Buyer's sole benefit and may be waived by such Buyer at any time in its sole
discretion:

                                       12

<PAGE>

                  a. The Company shall have executed this Agreement, the
Registration Rights Agreement and the Pledge and Escrow Agreement, and delivered
the same to the Buyer.

                  b. The Company shall have delivered to such Buyer duly
executed Debentures (in such denominations as the Buyer shall request) and
Warrants and Additional Shares in accordance with Section 1(b) above.

                  c. The representations and warranties of the Company 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 such 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. The Buyer shall
have received a certificate or certificates, executed by the principal executive
officer 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 such Buyer
including, but not limited to certificates with respect to the Company's
Certificate of Incorporation, By-laws and Board of Directors' resolutions
relating to the transactions contemplated hereby.

                  d. No litigation, statute, rule, regulation, executive order,
decree, ruling or injunction shall have been enacted, entered, promulgated or
endorsed by or in any court or governmental authority of competent jurisdiction
or any self-regulatory organization having authority over the matters
contemplated hereby which prohibits the consummation of any of the transactions
contemplated by this Agreement.

                  e. No event shall have occurred which could reasonably be
expected to have a Material Adverse Effect on the Company.

                  f. The Additional Shares, Conversion Shares and Warrant Shares
shall have been authorized for quotation on the OTCBB and trading in the Common
Stock on the OTCBB shall not have been suspended by the SEC or the OTCBB.

                  g. The Buyer shall have received an opinion of the Company's
counsel, dated as of the Closing Date, in form, scope and substance reasonably
satisfactory to the Buyer and in substantially the same form as EXHIBIT "E"
attached hereto.

                  h. The Buyer shall have received an officer's certificate
described in Section 3(c) above, dated as of the Closing Date.

         7. GOVERNING LAW; MISCELLANEOUS.

                  a. GOVERNING LAW. THIS AGREEMENT SHALL BE ENFORCED, GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE, WITHOUT
REGARD TO THE PRINCIPLES OF CONFLICT OF LAWS. THE PARTIES HERETO HEREBY SUBMIT
TO THE EXCLUSIVE JURISDICTION OF THE UNITED STATES FEDERAL COURTS LOCATED IN NEW
YORK, NEW YORK WITH RESPECT TO ANY DISPUTE ARISING UNDER THIS AGREEMENT, THE
AGREEMENTS ENTERED INTO IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY. BOTH PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT
FORUM TO THE MAINTENANCE OF SUCH SUIT OR PROCEEDING. BOTH PARTIES FURTHER AGREE

                                       13

<PAGE>

THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED
IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR
PROCEEDING. NOTHING HEREIN SHALL AFFECT EITHER PARTY'S RIGHT TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW. BOTH PARTIES AGREE THAT A FINAL
NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER
LAWFUL MANNER. THE PARTY WHICH DOES NOT PREVAIL IN ANY DISPUTE ARISING UNDER
THIS AGREEMENT SHALL BE RESPONSIBLE FOR ALL FEES AND EXPENSES, INCLUDING
ATTORNEYS' FEES, INCURRED BY THE PREVAILING PARTY IN CONNECTION WITH SUCH
DISPUTE.

                  b. COUNTERPARTS; SIGNATURES BY FACSIMILE. This Agreement may
be executed in one or more counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same agreement and shall
become effective when counterparts have been signed by each party and delivered
to the other party. This Agreement, once executed by a party, may be delivered
to the other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement.

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

                  d. SEVERABILITY. In the event that any provision of this
Agreement is invalid or unenforceable under any applicable statute or rule of
law, then such provision shall be deemed inoperative to the extent that it may
conflict therewith and shall be deemed modified to conform to such statute or
rule of law. Any provision hereof which may prove invalid or unenforceable under
any law shall not affect the validity or enforceability of any other provision
hereof.

                  e. ENTIRE AGREEMENT; AMENDMENTS. 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 the 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.

                  f. NOTICES. Any notices required or permitted to be given
under the terms of this Agreement shall be sent by certified or registered mail
(return receipt requested) or delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile and shall be effective
five days after being placed in the mail, if mailed by regular United States
mail, or upon receipt, if delivered personally or by courier (including a
recognized overnight delivery service) or by facsimile, in each case addressed
to a party. The addresses for such communications shall be:

                           If to the Company:

                           VisiJet, Inc.
                           192 Technology Drive, Suite Q
                           Irvine, California 92618
                           Attention: Laurence M. Schreiber
                           Telephone: (949) 450-1660
                           Facsimile: (949) 453-9652

                                       14

<PAGE>

         If to a Buyer: To the address set forth immediately below such Buyer's
name on the signature pages hereto.

                           With copy to:

                           Tarter Krinsky & Drogin LLP
                           470 Park Avenue South, 14th Floor
                           New York, New York 10016
                           Attention:  James G. Smith, Esq.
                           Telephone: (212) 481-8585
                           Facsimile: (212)-481-9062

         Each party shall provide notice to the other party of any change in
address.

                  g. SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and inure to the benefit of the parties and their 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.
Notwithstanding the foregoing, subject to Section 2(f), any Buyer may assign its
rights hereunder to any person that purchases Securities in a private
transaction from a Buyer or to any of its "affiliates," as that term is defined
under the 1934 Act, without the consent of the Company.

                  h. 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.

                  i. SURVIVAL. The representations and warranties of the Company
and the agreements and covenants set forth in Sections 3, 4 and 7 shall survive
the closing hereunder notwithstanding any due diligence investigation conducted
by or on behalf of the Buyers. The Company agrees to indemnify and hold harmless
each of the Buyers and all their officers, directors, employees and agents for
loss or damage arising as a result of or related to any breach or alleged breach
by the Company of any of its representations, warranties and covenants set forth
in Sections 3 and 4 hereof or any of its covenants and obligations under this
Agreement or the Registration Rights Agreement, including advancement of
expenses as they are incurred.

                  j. PUBLICITY. The Company and each of the Buyers shall have
the right to review a reasonable period of time before issuance of any press
releases, SEC, OTCBB or NASD filings, or any other public statements with
respect to the transactions contemplated hereby; PROVIDED, HOWEVER, that the
Company shall be entitled, without the prior approval of each of the Buyers, to
make any press release or SEC, OTCBB (or other applicable trading market) or
NASD filings with respect to such transactions as is required by applicable law
and regulations (although each of the Buyers shall be consulted by the Company
in connection with any such press release prior to its release and shall be
provided with a copy thereof and be given an opportunity to comment thereon).

                  k. 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.

                                       15

<PAGE>

                  l. 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.

                  m. REMEDIES. The Company acknowledges that a breach by it of
its obligations hereunder will cause irreparable harm to the Buyers 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 Agreement will be inadequate and agrees, in the event of a breach or
threatened breach by the Company of the provisions of this Agreement, that the
Buyers shall be entitled, in addition to all other available remedies at law or
in equity, and in addition to the penalties assessable herein, to an injunction
or injunctions restraining, preventing or curing any breach of this Agreement
and to enforce specifically the terms and provisions hereof, without the
necessity of showing economic loss and without any bond or other security being
required.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       16

<PAGE>

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

VISIJET, INC.

By: /S/ RANDAL A. BAILEY
    ---------------------
Randal A. Bailey
President

BUSHIDO CAPITAL MASTER FUND L.P.
By: Bushido Capital Partners, Ltd.

By: /S/ LOUIS RABMAN
    ----------------
Louis Rabman
President

JURISDICTION:     Cayman Islands
ADDRESS:          275 Seventh Avenue, Suite 2000
                  New York, New York 10001
                  Facsimile: (212)
                  Telephone: (212) 750-5200

AGGREGATE SUBSCRIPTION AMOUNT:
         Aggregate Principal Amount of Debentures:                $600,000
         Number of Warrants (Exhibit B-1):                         150,000
         Number of Warrants (Exhibit B-2):                         300,000
         Additional Shares:                                         90,000
         Aggregate Purchase Price:                                $600,000

BRIDGES & PIPES LLC

By: /S/ DAVID FUCHS
    ---------------
David Fuchs
Managing Member

JURISDICTION:     New York
ADDRESS:          830 3rd Avenue, 14th Floor
                  New York, NY 10022
                  Facsimile: 212-581-7010
                  Telephone: 212-922-2090

AGGREGATE SUBSCRIPTION AMOUNT:
         Aggregate Principal Amount of Debentures:                $400,000
         Number of Warrants (Exhibit B-1):                         100,000
         Number of Warrants (Exhibit B-2):                         200,000
         Additional Shares:                                         60,000
         Aggregate Purchase Price:                                $400,000

                                       17

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00070-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00070-of-00352.parquet"}]]