Document:

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                                                                   EXHIBIT 10.36

                         SERIES C SUBSCRIPTION AGREEMENT

WARP Technology Holdings, Inc.
Attention: Ernest Mysogland
151 Railroad Avenue
Greenwich, CT 06830

      Re:   Subscription for Series C Convertible Notes

Gentlemen:

      This Series C Subscription Agreement (this "Agreement") sets forth the
terms and conditions under which the undersigned investor (an "Investor," and
collectively with other investors, the "Investors") agrees to purchase Series C
Convertible Notes (the "Notes") to be issued under the terms and conditions
hereof by WARP Technology Holdings, Inc., a Nevada corporation ("WARPo or the
"Company"). The Notes are convertible into (i) shares (the "Shares") of the
Company's Series C Preferred Stock, par value $.00001 per share (the "Series C
Stock"), and (ii) warrants (the "Warrants") to acquire shares of the Company's
common stock, par value $.00001 per share (the "Common Stock"). The shares of
Common Stock into which the Shares are convertible, or for which the Warrants
are exercisable, are sometimes referred to herein as the "Conversion Shares."
The Notes, the Shares, the Warrants and the Conversion Shares are referred to
collectively as the "Securities."

      The undersigned investor understands that the Company is offering for sale
up to [$14,000,000] of Notes, and that the offering is made pursuant to a
Confidential Private Offering Memorandum (the "Memorandum") dated January 15,
2005, all as more particularly described and set forth in the Memorandum. The
undersigned understands that the Notes have the rights set forth in the
Memorandum and in the form of the Note included therewith. The undersigned
understands that the Notes automatically convert into Shares and Warrants in
accordance with the terms and conditions of the Notes, as set forth in the
Memorandum. The undersigned understands that the Shares have the rights,
privileges and preferences as set forth in the Certificate of Designation of the
Series C Preferred Stock (the "Certificate") substantially in the form attached
to the Memorandum. The undersigned understands that the Warrants have the
rights, privileges and preferences as described in the Memorandum and in that
form of Warrant attached thereto. The undersigned further understands that the
offering is being made without registration of any of the Securities under the
Securities Act of 1933, as amended (the "Securities Act") or otherwise, and is
being made only to "accredited investors" (as defined in Rule 501 of Regulation
D under the Securities Act).

      Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Memorandum.

      1. Subscription. Subject to the terms and conditions hereof and the
provisions of the Memorandum, the undersigned hereby irrevocably subscribes for,
and agrees to purchase, that amount of Notes set forth in Appendix A hereto, the
purchase price for which is payable as described in Section 4 hereof. The
undersigned acknowledges that the Notes, the Shares, the

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Warrants and the Conversion Shares, if issued by the Company, will be subject to
restrictions on transfer as further set forth in this Agreement and/or in the
Investors' Agreement.

      2. Acceptance of Subscription and Issuance of Notes. It is understood and
agreed that the Company shall have the sole right, at its complete discretion,
to accept or reject this subscription, in whole or in part, for any reason and
that the same shall be deemed to be accepted by the Company only when it is
signed by a duly authorized officer of the Company and delivered to the
undersigned at the Closing referred to in Section 3 hereof. Subscriptions need
not be accepted in the order received, and the Notes may be allocated among
subscribers. Notwithstanding anything in this Agreement to the contrary, the
Company shall have no obligation to issue any of the Notes to any person who is
a resident of a jurisdiction in which the issuance of Notes to such person would
constitute a violation of the securities, "blue sky" or other similar laws of
such jurisdiction (collectively referred to as the "State Securities Laws").

      3. The Closing. The closing of the purchase and sale of the Notes (the
"Closing") shall take place at the offices of the Company, at 10:00 a.m. on
January [___], 2005 or at such other time and place as the Company shall
designate by notice to the undersigned.

      4. Payment of the Purchase Price. Payment for the Notes shall be received
by the Company from the undersigned by wire transfer of immediately available
funds at or prior to the Closing, in an amount as set forth in the Signature
Page to this Agreement (Appendix A hereto). The Company shall deliver the Notes
to the undersigned promptly upon completion of the Closing.

      5. Representations and Warranties of the Company. As of the Closing, the
Company represents and warrants to the undersigned that:

            (a) Organization, Good Standing and Qualification. As of the
Closing, each of the Company and its Subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all requisite corporate power and
authority to carry on its business as now conducted and to own its properties.
Each of the Company and its Subsidiaries is duly qualified to do business as a
foreign corporation and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property makes such
qualification or leasing necessary unless the failure to so qualify has not and
could not reasonably be expected to have a Material Adverse Effect.

            (b) Authorization. Subject to the effectiveness of the filing of the
Amendment, the Company has full power and authority and has taken all requisite
action on the part of the Company, its officers, directors and stockholders
necessary for (i) the authorization, execution and delivery of the Transaction
Documents, (ii) the authorization of the performance of all obligations of the
Company hereunder or thereunder, and (iii) the authorization, issuance (or
reservation for issuance) and delivery of the Securities. The Transaction
Documents constitute the legal, valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability, relating to or affecting creditors'
rights generally.

            (c) Capitalization. All of the issued and outstanding shares of the
Company's capital stock have been duly authorized and validly issued and are
fully paid, nonassessable and free of preemptive rights and were issued in full
compliance with applicable state and federal

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securities law and any rights of third parties. All of the issued and
outstanding shares of capital stock of each Subsidiary have been duly authorized
and validly issued and are fully paid, nonassessable and free of preemptive
rights, were issued in full compliance with applicable state and federal
securities law and any rights of third parties and are owned by the Company,
beneficially and of record, subject to no lien, encumbrance or other adverse
claim. Other than pursuant to the Investors' Agreement (the "Investors'
Agreement" or the "Stockholders' Agreement"), dated January __, 2005, among the
Company and certain Investors (as defined therein) when such is executed and
delivered, or pursuant to the Certificate of Designations, Preferences and
Rights pertaining to the Company's Series C Preferred Stock (the "Series C
Certificate of Designations") when such is filed and becomes effective, no
Person is entitled to preemptive or similar statutory or contractual rights with
respect to any securities of the Company. Other than pursuant to the Investors'
Agreement, or any agreements which have been filed as exhibits to the SEC
Filings (collectively, the "Material Contracts"), there are no voting
agreements, buy-sell agreements, options or rights of first purchase agreements
or other agreements of any kind among the Company and any of the securityholders
of the Company relating to the securities of the Company held by them. Other
than pursuant to the Investors' Agreement, or any of the Material Contracts, no
Person has the right to require the Company to register any securities of the
Company under the Securities Act, whether on a demand basis or in connection
with the registration of securities of the Company for its own account or for
the account of any other Person, other than pursuant to the Investors'
Agreement.

            The issuance and sale of the Securities hereunder will not obligate
the Company to issue shares of Common Stock or other securities to any other
Person (other than the Investors) and will not result in the adjustment of the
exercise, conversion, exchange or reset price of any outstanding security.

            The Company does not have outstanding stockholder purchase rights or
"poison pill" or any similar arrangement in effect giving any Person the right
to purchase any equity interest in the Company upon the occurrence of certain
events.

            (d) Valid Issuance. The Notes, Series C Preferred Stock and Warrants
have been duly and validly authorized. Subject to the effectiveness of the
filing of the Amendment, upon the conversion of the Notes, the shares of Series
C Preferred Stock will be validly issued, fully paid and non-assessable, free
and clear of all encumbrances and restrictions, except for restrictions on
transfer set forth in the Transaction Documents or imposed by applicable
securities laws and except for those created by the Investors. Subject to the
effectiveness of the filing of the Amendment, upon the conversion of the Series
C Preferred Stock and the exercise of the Warrants, the Conversion Shares will
be validly issued, fully paid and non-assessable, free and clear of all
encumbrances and restrictions, except for restrictions on transfer set forth in
the Transaction Documents or imposed by applicable securities laws and except
for those created by the Investors. Subject to the effectiveness of the filing
of the Amendment, the Company has reserved a sufficient number of shares of
capital stock for issuance upon the conversion of the Notes, conversion of the
Series C Preferred Stock and exercise of the Warrants.

            (e) Consents. The execution, delivery and performance by the Company
of the Transaction Documents and the offer, issuance and sale of the Securities
require no consent of, action by or in respect of, or filing with, any Person,
governmental body, agency, or official

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other than the Amendment, filings that have been made pursuant to applicable
state securities laws and post-sale filings pursuant to applicable state and
federal securities laws which the Company undertakes to file within the
applicable time periods. Subject to the accuracy of the representations and
warranties of each Investor, the Company has taken all action necessary to
exempt (i) the issuance and sale of the Securities, (ii) the issuance of the
Warrants and shares of Series C Preferred Stock upon conversion of the Notes and
the issuance of the Conversion Shares upon the conversion of the Series C
Preferred Stock and exercise of the Warrants, and (iii) the other transactions
contemplated by the Transaction Documents from the provisions of any stockholder
rights plan or other "poison pill" arrangement, any anti-takeover, business
combination or control share law or statute binding on the Company or to which
the Company or any of its assets and properties may be subject and any provision
of the Company's Articles of Incorporation or By-laws that is or could
reasonably be expected to become applicable to the Investors as a result of the
transactions contemplated hereby, including without limitation, the issuance of
the Securities and the ownership, disposition or voting of the Securities by the
Investors or the exercise of any right granted to the Investors pursuant to this
Agreement or the other Transaction Documents.

            (f) Delivery of SEC Filings; Business. The Company has made
available to the Investors through the EDGAR system, true and complete copies of
the Company's most recent Annual Report on Form 10-K for the fiscal year ended
June 30, 2004 (the "10-K"), and all other reports filed by the Company pursuant
to the Exchange Act since the filing of the 10-K and prior to the date hereof
(collectively, the "SEC Filings"). The SEC Filings are the only filings required
of the Company pursuant to the Exchange Act for such period. The Company and its
Subsidiaries are engaged in all material respects only in the business described
in the SEC Filings and the SEC Filings contain a complete and accurate
description in all material respects of the business of the Company and its
Subsidiaries, taken as a whole.

            (g) Use of Proceeds. The net proceeds of the sale of the Notes shall
be used for the acquisition of Gupta Technologies, LLC, and for working capital
purposes.

            (h) No Material Adverse Change. Since June 30, 2004, except as
identified and described in the SEC Filings, there has not been:

                  (i) any change in the consolidated assets, liabilities,
financial condition or operating results of the Company from that reflected in
the financial statements included in the Company's Quarterly Report on Form 10-Q
for the quarter ended September 30, 2004, except for changes in the ordinary
course of business which have not had and could not reasonably be expected to
have a Material Adverse Effect, individually or in the aggregate;

                  (ii) any declaration or payment of any dividend (other than
the payment in shares of Common Stock of accrued dividends on the shares of the
Company's Series B 10% Cumulative Convertible Preferred Stock or on the shares
of the Company's Series B-2 Preferred Stock), or any authorization or payment of
any distribution, on any of the capital stock of the Company, or any redemption
or repurchase of any securities of the Company;

                  (iii) any material damage, destruction or loss, whether or not
covered by insurance to any assets or properties of the Company or its
Subsidiaries;

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                  (iv) any waiver, not in the ordinary course of business, by
the Company or any Subsidiary of a material right or of a material debt owed to
it;

                  (v) any satisfaction or discharge of any lien, claim or
encumbrance or payment of any obligation by the Company or a Subsidiary, except
in the ordinary course of business and which is not material to the assets,
properties, financial condition, operating results or business of the Company
and its Subsidiaries taken as a whole (as such business is presently conducted
and as it is proposed to be conducted) other than pursuant to the conversion of
the existing notes ( the "Existing Bridge Notes") issued by the Company the
proceeds of which were used to pay purchase price deposits to the seller for the
acquisition of Gupta;

                  (vi) any change or amendment to the Company's Articles of
Incorporation (other than the Amendment and the Series C Certificate of
Designations) or Bylaws, or material change to any material contract or
arrangement by which the Company or any Subsidiary is bound or to which any of
their respective assets or properties is subject;

                  (vii) any material labor difficulties or labor union
organizing activities with respect to employees of the Company or any
Subsidiary;

                  (viii) any material transaction entered into by the Company or
a Subsidiary other than in the ordinary course of business other than this
Agreement, the Transaction Documents or the issuance of certain notes and
warrants pursuant to a Senior Note and Warrant Purchase Agreement and a Senior
Subordinated Note and Warrant Purchase Agreement (collectively, the "Other
Notes");

                  (ix) the loss of the services of any key employee, or material
change in the composition or duties of the senior management of the Company or
any Subsidiary;

                  (x) the loss or threatened loss of any customer which has had
or could reasonably be expected to have a Material Adverse Effect; or

                  (xi) any other event or condition of any character that has
had or could reasonably be expected to have a Material Adverse Effect.

            (i) SEC Filings.

                  (i) At the time of filing thereof, the SEC Filings complied as
to form in all material respects with the requirements of the Exchange Act and
did not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein, in the
light of the circumstances under which they were made, not misleading.

                  (ii) Each registration statement and any amendment thereto
filed by the Company since June 30, 2002 pursuant to the Securities Act and the
rules and regulations thereunder, as of the date such statement or amendment
became effective, complied as to form in all material respects with the
Securities Act and did not contain any untrue statement of a

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material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements made therein not misleading; and
each prospectus filed pursuant to Rule 424(b) under the Securities Act, as of
its issue date and as of the closing of any sale of securities pursuant thereto
did not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading.

            (j) No Conflict, Breach, Violation or Default. The execution,
delivery and performance of the Transaction Documents by the Company and the
issuance and sale of the Securities will not conflict with or result in a breach
or violation of any of the terms and provisions of, or constitute a default
under (i) the Company's Articles of Incorporation (subject to the filing of the
Amendment) or the Company's Bylaws, both as in effect on the date hereof, or
(ii)(a) any statute, rule, regulation or order of any governmental agency or
body or any court, domestic or foreign, having jurisdiction over the Company,
any Subsidiary or any of their respective assets or properties, or (b) any
agreement or instrument to which the Company or any Subsidiary is a party or by
which the Company or a Subsidiary is bound or to which any of their respective
assets or properties is subject.

            (k) Tax Matters. The Company and each Subsidiary has timely prepared
and filed all tax returns required to have been filed by the Company or such
Subsidiary with all appropriate governmental agencies and timely paid all taxes
shown thereon or otherwise owed by it. The charges, accruals and reserves on the
books of the Company in respect of taxes for all fiscal periods are adequate in
all material respects, and there are no material unpaid assessments against the
Company or any Subsidiary nor, to the Company's Knowledge, any basis for the
assessment of any additional taxes, penalties or interest for any fiscal period
or audits by any federal, state or local taxing authority except for any
assessment which is not material to the Company and its Subsidiaries, taken as a
whole. All taxes and other assessments and levies that the Company or any
Subsidiary is required to withhold or to collect for payment have been duly
withheld and collected and paid to the proper governmental entity or third party
when due. There are no tax liens or claims pending or, to the Company's
Knowledge, threatened against the Company or any Subsidiary or any of their
respective assets or property. There are no outstanding tax sharing agreements
or other such arrangements between the Company and any Subsidiary or other
corporation or entity.

            (l) Title to Properties. Except as disclosed in the SEC Filings,
including, without limitation, the Material Contracts, and except pursuant to
this Agreement and the Transaction Documents, and the Other Notes, the Company
and each Subsidiary has good and marketable title to all real properties and all
other properties and assets owned by it, in each case free from liens,
encumbrances and defects that would materially affect the value thereof or
materially interfere with the use made or currently planned to be made thereof
by them; and except as disclosed in the SEC Filings, the Company and each
Subsidiary holds any leased real or personal property under valid and
enforceable leases with no exceptions that would materially interfere with the
use made or currently planned to be made thereof by them.

            (m) Certificates, Authorities and Permits. The Company and each
Subsidiary possess adequate certificates, authorities or permits issued by
appropriate governmental agencies or bodies necessary to conduct the business
now operated by it, and neither the Company nor any

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Subsidiary has received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit that, if determined
adversely to the Company or such Subsidiary, could reasonably be expected to
have a Material Adverse Effect, individually or in the aggregate.

            (n) Labor Matters.

                  (i) The Company is not a party to or bound by any collective
bargaining agreements or other agreements with labor organizations. The Company
has not violated in any material respect any laws, regulations, orders or
contract terms, affecting the collective bargaining rights of employees, labor
organizations or any laws, regulations or orders affecting employment
discrimination, equal opportunity employment, or employees' health, safety,
welfare, wages and hours.

                  (ii) (a) There are no labor disputes existing, or to the
Company's Knowledge, threatened, involving strikes, slow-downs, work stoppages,
job actions, disputes, lockouts or any other disruptions of or by the Company's
employees, (b) there are no unfair labor practices or petitions for election
pending or, to the Company's Knowledge, threatened before the National Labor
Relations Board or any other federal, state or local labor commission relating
to the Company's employees, (c) no demand for recognition or certification
heretofore made by any labor organization or group of employees is pending with
respect to the Company and (d) to the Company's Knowledge, the Company enjoys
good labor and employee relations with its employees and labor organizations.

                  (iii) The Company is, and at all times has been, in full
compliance in all material respects with all applicable laws respecting
employment (including laws relating to classification of employees and
independent contractors) and employment practices, terms and conditions of
employment, wages and hours, and immigration and naturalization. There no claims
are pending against the Company before the Equal Employment Opportunity
Commission or any other administrative body or in any court asserting any
violation of Title VII of the Civil Rights Act of 1964, the Age Discrimination
Act of 1967, 42 U.S.C. Sections 1981 or 1983 or any other federal, state or
local Law, statute or ordinance barring discrimination in employment.

                  (iv) Other than the Material Contracts, the Company is not a
party to, or bound by, any employment or other contract or agreement that
contains any severance, termination pay or change of control liability or
obligation, including, without limitation, any "excess parachute payment," as
defined in Section 2806(b) of the Internal Revenue Code.

                  (v) Each of the Company's employees is a Person who is either
a United States citizen or a permanent resident entitled to work in the United
States. To the Company's Knowledge, the Company has no liability for the
improper classification by the Company of such employees as independent
contractors or leased employees prior to the Closing.

            (o) Intellectual Property.

                  (i) All Intellectual Property of the Company and its
Subsidiaries is

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currently in compliance with all legal requirements (including timely filings,
proofs and payments of fees) and is valid and enforceable. No Intellectual
Property of the Company or its Subsidiaries which is necessary for the conduct
of Company's and each of its Subsidiaries' respective businesses as currently
conducted or as currently proposed to be conducted has been or is now involved
in any cancellation, dispute or litigation, and, to the Company's Knowledge, no
such action is threatened. No patent of the Company or its Subsidiaries
necessary for the conduct of the Company's and each of its Subsidiaries'
respective businesses as currently conducted or as currently proposed to be
conducted has been or is now involved in any interference, reissue,
re-examination or opposition proceeding.

                  (ii) All of the licenses and sublicenses and consent, royalty
or other agreements concerning Intellectual Property which are necessary for the
conduct of the Company's and each of its Subsidiaries' respective businesses as
currently conducted or as currently proposed to be conducted to which the
Company or any Subsidiary is a party or by which any of their assets are bound
(other than generally commercially available, non-custom, off-the-shelf software
application programs having a retail acquisition price of less than $10,000 per
license) (collectively, "License Agreements") are valid and binding obligations
of the Company or its Subsidiaries that are parties thereto and, to the
Company's Knowledge, the other parties thereto, enforceable in accordance with
their terms, except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or
other similar laws affecting the enforcement of creditors' rights generally, and
there exists no event or condition which will result in a material violation or
breach of or constitute (with or without due notice or lapse of time or both) a
default by the Company or any of its Subsidiaries under any such License
Agreement.

                  (iii) The Company and its Subsidiaries own or have the valid
right to use all of the Intellectual Property that is necessary for the conduct
of the Company's and each of its Subsidiaries' respective businesses as
currently conducted or as currently proposed to be conducted and for the
ownership, maintenance and operation of the Company's and its Subsidiaries'
properties and assets, free and clear of all liens, encumbrances, adverse claims
or obligations to license all such owned Intellectual Property and Confidential
Information, other than licenses entered into in the ordinary course of the
Company's and its Subsidiaries' businesses, and other than under the Material
Contracts, under this Agreement, the Transactions Documents, or the Other Notes.
The Company and its Subsidiaries have a valid and enforceable right to use all
third party Intellectual Property and Confidential Information used or held for
use in the respective businesses of the Company and its Subsidiaries.

                  (iv) The conduct of the Company's and its Subsidiaries'
businesses as currently conducted does not infringe or otherwise impair or
conflict with (collectively, "Infringe") any Intellectual Property rights of any
third party or any confidentiality obligation owed to a third party, and, to the
Company's Knowledge, the Intellectual Property and Confidential Information of
the Company and its Subsidiaries which are necessary for the conduct of
Company's and each of its Subsidiaries' respective businesses as currently
conducted or as currently proposed to be conducted are not being Infringed by
any third party. There is no litigation or order pending or outstanding or, to
the Company's Knowledge, threatened or imminent, that seeks to limit or
challenge or that concerns the ownership, use, validity or enforceability of any
Intellectual Property or Confidential Information of the Company and its

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Subsidiaries and the Company's and its Subsidiaries' use of any Intellectual
Property or Confidential Information owned by a third party, and, to the
Company's Knowledge, there is no valid basis for the same.

                  (v) The consummation of the transactions contemplated hereby
and by the other Transaction Documents will not result in the alteration, loss,
impairment of or restriction on the Company's or any of its Subsidiaries'
ownership or right to use any of the Intellectual Property or Confidential
Information which is necessary for the conduct of Company's and each of its
Subsidiaries' respective businesses as currently conducted or as currently
proposed to be conducted.

                  (vi) The Company and its Subsidiaries have taken reasonable
steps to protect the Company's and its Subsidiaries' rights in their
Intellectual Property and Confidential Information. Each employee, consultant
and contractor who has had access to Confidential Information which is necessary
for the conduct of Company's and each of its Subsidiaries' respective businesses
as currently conducted or as currently proposed to be conducted has executed an
agreement to maintain the confidentiality of such Confidential Information and
has executed appropriate agreements that are substantially consistent with the
Company's standard forms thereof. Except under confidentiality obligations,
there has been no material disclosure of any of the Company's or its
Subsidiaries' Confidential Information to any third party.

            (p) Environmental Matters. Neither the Company nor any Subsidiary is
in violation of any statute, rule, regulation, decision or order of any
governmental agency or body or any court, domestic or foreign, relating to the
use, disposal or release of hazardous or toxic substances or relating to the
protection or restoration of the environment or human exposure to hazardous or
toxic substances (collectively, "Environmental Laws"), owns or operates any real
property contaminated with any substance that is subject to any Environmental
Laws, is liable for any off-site disposal or contamination pursuant to any
Environmental Laws, and is subject to any claim relating to any Environmental
Laws, which violation, contamination, liability or claim has had or could
reasonably be expected to have a Material Adverse Effect, individually or in the
aggregate; and there is no pending or, to the Company's Knowledge, threatened
investigation that might lead to such a claim.

            (q) Litigation. Except as disclosed in the SEC Filings, there are no
pending actions, suits or proceedings against or affecting the Company, its
Subsidiaries or any of its or their properties; and to the Company's Knowledge,
no such actions, suits or proceedings are threatened or contemplated.

            (r) Financial Statements. The financial statements included in each
SEC Filing present fairly, in all material respects, the consolidated financial
position of the Company as of the dates shown and its consolidated results of
operations and cash flows for the periods shown, and such financial statements
have been prepared in conformity with United States generally accepted
accounting principles applied on a consistent basis ("GAAP") (except as may be
disclosed therein or in the notes thereto, and, in the case of quarterly
financial statements, as permitted by Form 10-Q under the Exchange Act). Except
as set forth in the financial statements of the Company included in the SEC
Filings filed prior to the date hereof, neither the Company nor any of its
Subsidiaries has incurred any liabilities, contingent or otherwise, except those

<PAGE>

incurred in the ordinary course of business, consistent (as to amount and
nature) with past practices since the date of such financial statements, none of
which, individually or in the aggregate, have had or could reasonably be
expected to have a Material Adverse Effect.

            (s) Insurance Coverage. The Company and each Subsidiary maintains in
full force and effect insurance coverage that is customary for comparably
situated companies for the business being conducted and properties owned or
leased by the Company and each Subsidiary, and the Company reasonably believes
such insurance coverage to be adequate against all liabilities, claims and risks
against which it is customary for comparably situated companies to insure.

            (t) Brokers and Finders. No Person will have, as a result of the
transactions contemplated by the Transaction Documents, any valid right,
interest or claim against or upon the Company, any Subsidiary or a Investor for
any commission, fee or other compensation pursuant to any agreement, arrangement
or understanding entered into by or on behalf of the Company, other than as
described in a Schedule provided by the Company. No two Persons listed in such
Schedule shall be entitled to any commission, fee or other compensation with
respect to the purchase of Securities by the same Investor.

            (u) No Directed Selling Efforts or General Solicitation. Neither the
Company nor any Person acting on its behalf has conducted any general
solicitation or general advertising (as those terms are used in Regulation D) in
connection with the offer or sale of any of the Securities.

            (v) 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 Company security or solicited any
offers to buy any security, under circumstances that would adversely affect
reliance by the Company on Section 4(2) for the exemption from registration for
the transactions contemplated hereby or would require registration of the
Securities under the Securities Act.

            (w) Private Placement. The offer and sale of the Securities to the
Investors as contemplated hereby is exempt from the registration requirements of
the Securities Act, subject to the accuracy of the Investors' representations
set forth herein.

            (x) Questionable Payments. Neither the Company nor any of its
Subsidiaries nor, to the Company's Knowledge, any of their respective current or
former stockholders, directors, officers, employees, agents or other Persons
acting on behalf of the Company or any Subsidiary, has on behalf of the Company
or any Subsidiary or in connection with their respective businesses: (a) used
any corporate funds for unlawful contributions, gifts, entertainment or other
unlawful expenses relating to political activity; (b) made any direct or
indirect unlawful payments to any governmental officials or employees from
corporate funds; (c) established or maintained any unlawful or unrecorded fund
of corporate monies or other assets; (d) made any false or fictitious entries on
the books and records of the Company or any Subsidiary; or (e) made any unlawful
bribe, rebate, payoff, influence payment, kickback or other unlawful payment of
any nature.

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            (y) Transactions with Affiliates. Except as disclosed in the SEC
Filings, none of the officers or directors of the Company and, to the Company's
Knowledge, none of the employees of the Company is presently a party to any
transaction with the Company or any Subsidiary (other than as holders of stock
options and/or warrants, and 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 Company's Knowledge, any entity in which
any officer, director, or any such employee has a substantial interest or is an
officer, director, trustee or partner.

            (z) Internal Controls. The Company is in material compliance with
the provisions of the Sarbanes-Oxley Act of 2002 currently applicable to the
Company. The Company and the 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 GAAP 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. The
Company has established disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the Company and designed such
disclosure controls and procedures to ensure that material information relating
to the Company, including the Subsidiaries, is made known to the certifying
officers by others within those entities, particularly during the period in
which the Company's most recently filed period report under the Exchange Act, as
the case may be, is being prepared. The Company's certifying officers have
evaluated the effectiveness of the Company's controls and procedures as of the
end of the period covered by the most recently filed periodic report under the
Exchange Act (such date, the "Evaluation Date"). The Company presented in its
most recently filed periodic report under the Exchange Act the conclusions of
the certifying officers about the effectiveness of the disclosure controls and
procedures based on their evaluations as of the Evaluation Date. Since the
Evaluation Date, there have been no significant changes in the Company's
internal controls (as such term is defined in Item 307(b) of Regulation S-K) or,
to the Company's Knowledge, in other factors that could significantly affect the
Company's internal controls. The Company maintains and will continue to maintain
a standard system of accounting established and administered in accordance with
GAAP and the applicable requirements of the Exchange Act.

            (aa) Indebtedness and Other Contracts. Except as disclosed in the
SEC Filings, under the Material Contracts, this Agreement, any of the
Transaction Documents, or the Other Notes, neither the Company nor any of its
Subsidiaries (i) has any outstanding Indebtedness (as defined below), (ii) is a
party to any contract, agreement or instrument, the violation of which, or
default under which, by the other party(ies) to such contract, agreement or
instrument would result in a Material Adverse Effect, (iii) is in violation of
any term of or in default under any contract, agreement or instrument relating
to any Indebtedness, except where such violations and defaults would not result,
individually or in the aggregate, in a Material Adverse Effect, or (iv) is a
party to any contract, agreement or instrument relating to any Indebtedness, the
performance of which, in the judgment of the Company's officers, has or is
expected to have a Material Adverse Effect. For purposes of this Agreement: (x)
"Indebtedness" of any Person means, without

<PAGE>

duplication (A) all indebtedness for borrowed money, (B) all obligations issued,
undertaken or assumed as the deferred purchase price of property or services
(other than trade payables entered into in the ordinary course of business), (C)
all reimbursement or payment obligations with respect to letters of credit,
surety bonds and other similar instruments, (D) all obligations evidenced by
notes, bonds, debentures or similar instruments, including obligations so
evidenced incurred in connection with the acquisition of property, assets or
businesses, (E) all indebtedness created or arising under any conditional sale
or other title retention agreement, or incurred as financing, in either case
with respect to any property or assets acquired with the proceeds of such
indebtedness (even though the rights and remedies of the seller or bank under
such agreement in the event of default are limited to repossession or sale of
such property), (F) all monetary obligations under any leasing or similar
arrangement which, in connection with generally accepted accounting principles,
consistently applied for the periods covered thereby, is classified as a capital
lease, (G) all indebtedness referred to in clauses (A) through (F) above secured
by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any mortgage, lien, pledge, charge,
security interest or other encumbrance upon or in any property or assets
(including accounts and contract rights) owned by any Person, even though the
Person which owns such assets or property has not assumed or become liable for
the payment of such indebtedness, and (H) all Contingent Obligations in respect
of indebtedness or obligations of others of the kinds referred to in clauses (A)
through (G) above; and (y) "Contingent Obligation" means, as to any Person, any
direct or indirect liability, contingent or otherwise, of that Person with
respect to any indebtedness, lease, dividend or other obligation of another
Person if the primary purpose or intent of the Person incurring such liability,
or the primary effect thereof, is to provide assurance to the obligee of such
liability that such liability will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such liability
will be protected (in whole or in part) against loss with respect thereto.

            (bb) Solvency. Assuming that no event or condition shall have
occurred after the date hereof and prior to the Closing that would have a
Material Adverse Effect and subject to the Closing , the closings of the Other
Notes, and the closing of the acquisition of Gupta, the Company will not be
Insolvent (as defined below) after giving effect to the issuance of the
Securities. For purposes of this Section 4.28, "Insolvent" means (i) the present
fair saleable value of the Company's assets is less than the amount required to
pay the Company's total indebtedness, (ii) the Company is unable to pay its
debts and liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured, or (iii) the Company intends to incur
or believes that it will incur debts that would be beyond its ability to pay as
such debts mature. Neither the Company nor any of its Subsidiaries has taken any
steps to seek protection pursuant to any bankruptcy law nor does the Company
have any knowledge or reason to believe that its or any of its Subsidiaries'
creditors intend to initiate involuntary bankruptcy proceedings or any actual
knowledge of any fact which would reasonably lead a creditor to do so.

<PAGE>

            (cc) Gupta. Upon the Closing, the closings of the Other Notes, and
the closing of the acquisition of Gupta under the Gupta Purchase Agreement, the
Company represents and warrants that the representations and warranties made by
Gupta Holdings, LLC (the "Seller") under the Gupta Purchase Agreement qualified
as to materiality shall be true and correct on the Closing Date, except to the
extent any such representation or warranty expressly speaks as of an earlier
date, in which case such representation or warranty shall be true and correct as
of such earlier date, and, the representations and warranties made by the Seller
under the Gupta Purchase Agreement not qualified as to materiality shall be true
and correct in all material respects on the Closing Date, except to the extent
any such representation or warranty expressly speaks as of an earlier date, in
which case such representation or warranty shall be true and correct in all
material respects as of such earlier date, and that the Gupta Purchase Agreement
shall be in full force and effect, enforceable in accordance with its terms.

      6. Representations, Warranties and Covenants of the Undersigned. The
undersigned hereby represents and warrants to and covenants with the Company and
each officer, director, representative and agent of the Company that:

      (a) In General:

            (i) The undersigned has all requisite authority to enter into this
Agreement and to perform all the obligations required to be performed by the
undersigned hereunder.

            (ii) The undersigned is a resident of the state set forth on the
signature page hereto and is not acquiring the Notes as an agent or otherwise
for any other person.

      (b) Information Concerning the Company:

            (i) The undersigned has received a copy of the Memorandum and each
of the Exhibits thereto. The undersigned has not been furnished any offering
literature other than the Memorandum and Exhibits thereto and has relied only on
the information contained therein, and in the Company Reports and Financial
Statements.

            (ii) The undersigned understands that, unless the undersigned
notifies the Company in writing to the contrary at or before the Closing, all
the undersigned's representations and warranties contained in this Agreement
will be deemed to have been reaffirmed and confirmed as of the Closing, taking
into account all information received by the undersigned.

            (iv) The undersigned understands that the purchase of the Securities
involves various and substantial risks, including those outlined in the
Memorandum and in this Agreement.

            (v) The undersigned understands that no federal or state agency has
passed upon the Securities or made any finding or determination concerning the
fairness or advisability of this investment.

            (vi) The undersigned understands that estimates and projections like
those contained in the Memorandum, by their nature, involve significant elements
of subjective judgment and analysis that may or may not be correct; that there
can be no assurance that such projections or goals will be attained; and that
the projections and estimates contained in the Memorandum should not be relied
upon as a promise or representation of the future performance of the Company.

<PAGE>

      (c) Status of Undersigned:

            (i) The undersigned has such knowledge, skill and experience in
business, financial and investment matters so that he is capable of evaluating
the merits and risks of an investment in the Securities. To the extent
necessary, the undersigned has retained, at the undersigned's own expense, and
relied upon, appropriate professional advice regarding the investment, tax and
legal merits and consequences of this Agreement and owning the Securities.

            (ii) The undersigned is an "accredited investor" as defined in Rule
501(a) of Regulation D ("Regulation D")under the Securities Act. The undersigned
agrees to furnish any additional information requested to assure compliance with
applicable federal and state securities laws in connection with the purchase and
sale of the Notes. The undersigned represents that the undersigned has completed
the Accredited Investor Certificate contained in Appendix B and that the
information contained therein is complete and accurate as of the date thereof
and is hereby affirmed as of the date hereof.

      (d) Restrictions on Transfer or Sale of Notes:

            (i) The undersigned is acquiring the Notes, and the Warrants and
Shares of Series C Preferred Stock into which the Notes are convertible, solely
for his, her or its own beneficial account, for investment purposes, and not
with a view to, or for resale in connection with, any distribution of any of the
Securities. The undersigned understands that the Securities have not been
registered under the Securities Act or any State Securities Laws by reason of
specific exemptions under the provisions thereof which depend in part upon the
investment intent of the undersigned and of the other representations made by
the undersigned in this Agreement. The undersigned understands that the Company
is relying upon the representations and agreements contained in this Agreement
(and any supplemental information) for the purpose of determining whether this
transaction meets the requirements for such exemptions.

            (ii) The undersigned understands that the Notes are, and the Shares,
Warrants and Conversion Shares will be, "restricted securities" under applicable
federal securities laws and that the Securities Act and the rules of the
Securities and Exchange Commission (the "SEC") provide in substance that the
undersigned may dispose of the Securities only pursuant to an effective
registration statement under the Securities Act or an exemption therefrom, and
the undersigned understands that the Company has no obligation or intention to
register any of the Shares or the Conversion Shares (except for the registration
rights granted hereunder and in the Investors' Agreement), or to take action so
as to permit sales pursuant to the Securities Act (including Rule 144
thereunder). Accordingly, the undersigned understands that under the SEC's
rules, the undersigned may dispose of the Notes, Shares and the Conversion
Shares principally only in "private placements" which are exempt from
registration under the Securities Act, in which event the transferee will
acquire "restricted securities" subject to the same limitations as in the hands
of the undersigned. As a consequence, the undersigned understands that he must
bear the economic risks of the investment in the Notes for an indefinite period
of time.

            (iii) The undersigned agrees to the further restrictions on transfer
of the Shares and any Conversion Shares as set forth in Appendix C.

            (iv) The undersigned has not offered or sold any portion of the
Securities purchased hereunder and has no present intention of dividing any such
Securities with others or of reselling or otherwise disposing of any portion of
such Securities either currently or after the

<PAGE>

passage of a fixed or determinable period of time or upon the occurrence or
nonoccurrence of any predetermined event or circumstance.

            (v) The undersigned acknowledges that neither the Company nor any
other person offered to sell the Securities to it by means of any form of
general advertising, such as media advertising or seminars.

            (vi) The undersigned acknowledges that the Company has the right in
its sole and absolute discretion to abandon this private placement at any time
prior to the completion of the offering and to return the previously paid
purchase price of the Securities without interest thereon, to the respective
subscribers.

            (vii) The undersigned has not used any person as a "Purchaser
Representative" within the meaning of Regulation D to represent it in
determining whether it should purchase the Securities.

      7. Conditions to Obligations of the Undersigned and the Company. The
obligations of the undersigned to purchase and pay for the amount of Notes
specified herein and of the Company to sell the amount of Notes are subject to
the satisfaction at or prior to the Closing of the following respective
conditions precedent:

            (a) With respect to the undersigned's obligations to close, the
representations and warranties of the Company contained in Section 5 hereof and,
with respect to the Company's obligations to close, the representation and
warranties of the undersigned contained in Section 6 hereof, shall be true and
correct on and as of the Closing in all material respects with the same effect
as though such representations and warranties had been made on and as of the
Closing;

            (b) Each of the Investors, the Company and any other required
parties shall have entered into the Investors' Agreement, and such agreement
shall be in full force and effect;

            (c) The Company shall have raised sufficient funds through the
Offering and other debt financings to Close the Acquisition of Gupta;

            (d) The requisite parties shall have executed and delivered the
Stockholders' Consent; and

            (e) No action, suit or proceeding before any arbitrator or any
governmental authority shall have been commenced and no investigation by any
governmental authority shall have been threatened against the Company, any
Subsidiary, Gupta, or any of the officers or directors of the Company, or such
Subsidiary or Gupta, seeking to restrain, prevent or change the transactions
contemplated by this Agreement or any related agreement or seeking damages in
connection with such transactions.

      8. Obligations Irrevocable. The obligations of the undersigned hereunder
to purchase the Notes shall be irrevocable, except with the consent of the
Company; provided, however, if the Closing has not occurred within thirty (30)
days after the date hereof, the undersigned may, upon written notice to the
Company, revoke this Agreement.

      9. Specific Performance. The undersigned acknowledges and agrees that in
the event of any breach of this Agreement, the Company would be irreparably
harmed and could not be made whole by monetary damages. The undersigned
accordingly agrees to waive the defense in any action for injunction or specific
performance that a remedy at law would be adequate and

<PAGE>

that the parties hereto, in addition to any other remedy to which they may be
entitled at law or in equity, shall be entitled to an injunction or to compel
specific performance of this Agreement.

      10. Brokers. The undersigned has not entered into any agreement to pay any
broker's or finder's fee to any Person with respect to this Agreement or the
transactions contemplated hereby.

      11. Survival and Indemnification.

      (a) Survival. All representations, warranties, covenants and agreements
contained in this Agreement shall be deemed to be representations, warranties,
covenants and agreements as of the date hereof (except to the extent any such
representation or warranty expressly speaks as of an earlier date, in which case
such representation or warranty shall be deemed to be as of such earlier date)
and shall survive the execution and delivery of this Agreement.

      (b) Indemnification. The Company agrees to indemnify and hold harmless, on
an after-tax and after insurance recovery basis, each Investor and its
Affiliates and their respective directors, officers, employees and agents from
and against any and all losses, claims, damages, liabilities and expenses
(including without limitation reasonable attorney fees and disbursements and
other expenses incurred in connection with investigating, preparing or defending
any action, claim or proceeding, pending or threatened and the costs of
enforcement thereof) (collectively, "Losses") to which such Person may become
subject as a result of any breach of representation, warranty, covenant or
agreement made by or to be performed on the part of the Company under the
Transaction Documents, and will reimburse any such Person for all such amounts
as they are incurred by such Person.

      (c) Conduct of Indemnification Proceedings. Promptly after receipt by any
Person (the "Indemnified Person") of notice of any demand, claim or
circumstances which would or might give rise to a claim or the commencement of
any action, proceeding or investigation in respect of which indemnity may be
sought pursuant to Section 5.2, such Indemnified Person shall promptly notify
the Company in writing and the Company shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to such Indemnified
Person, and shall assume the payment of all reasonable fees and expenses;
provided, however, that the failure of any Indemnified Person so to notify the
Company shall not relieve the Company of its obligations hereunder except to the
extent that the Company is materially prejudiced by such failure to notify. In
any such proceeding, any Indemnified Person shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such Indemnified Person unless: (i) the Company and the Indemnified Person
shall have mutually agreed to the retention of such counsel; or (ii) in the
reasonable judgment of counsel to such Indemnified Person representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. The Company shall not be liable for any
settlement of any proceeding effected without its written consent, which consent
shall not be unreasonably withheld, but if settled with such consent, or if
there be a final judgment for the plaintiff, the Company shall indemnify and
hold harmless such Indemnified Person from and against any loss or liability (to
the extent stated above) by reason of such settlement or judgment. Without the
prior written consent of the Indemnified Person, which consent shall not be
unreasonably withheld, the Company shall not effect any settlement of any
pending or threatened proceeding in respect of which any Indemnified Person is
or could have been a party and indemnity could have been sought hereunder by
such Indemnified Party, unless such settlement includes an unconditional release
of such Indemnified Person from all liability arising

<PAGE>

out of such proceeding.

      12. Miscellaneous.

      (a) Registration Rights. The Conversion Shares shall have the registration
rights described in the Investors' Agreement, dated January __, 2005.

      (b) Publicity / Form 8-K. By 8:30 a.m. (New York City time) on the trading
day immediately following the Closing Date, the Company shall issue a press
release disclosing the consummation of the transactions contemplated by this
Agreement. No later than the fourth trading day following the Closing Date, the
Company will file a Current Report on Form 8-K attaching the press release
described in the foregoing sentence as well as copies of the Transaction
Documents. In addition, the Company will make such other filings and notices in
the manner and time required by the SEC. Notwithstanding the foregoing, the
Company shall not publicly disclose the name of any Investor, or include the
name of any Investor in any filing with the SEC (other than any exhibits to
filings made in respect of this transaction in accordance with periodic filing
requirements under the Exchange Act) or any regulatory agency or Nasdaq, without
the prior written consent of such Investor, except to the extent such disclosure
is required by law or trading market regulations, in which case the Company
shall provide the Investors with prior notice of such disclosure.

      (c) No Waiver; Cumulative Remedies. No failure or delay on the part of any
party to this Agreement in exercising any right, power or remedy hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy hereunder. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.

      (d) Amendments, Waivers and Consents. Any provision in the Agreement to
the contrary notwithstanding, and except as hereinafter provided, changes in,
termination or amendments of or additions to this Agreement may be made, and
compliance with any covenant or provision set forth herein may be omitted or
waived, if the Company shall obtain consent thereto in writing from all of the
Investors. Any waiver or consent may be given subject to satisfaction of
conditions stated therein and any waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
Notwithstanding anything to the contrary contained herein (x) no amendment,
consent or waiver shall be effective to reduce the unanimous consent required
above and (y) any amendment, consent or waiver shall apply to all the Investors
and shall not discriminate against any particular Investor or Investors.

      (e) Addresses for Notices. All notices, requests, demands and other
communications provided for hereunder or under any Transaction Document shall be
in writing (including telegraphic and facsimile communications with confirmation
of receipt) and mailed, telegraphed or delivered to each applicable party at the
address set forth on the signature page hereto or at such other address as to
which such party may inform the other parties in writing in compliance with the
terms of this Section.

<PAGE>

      If to any other holder of capital stock of the Company: at such holder's
address for notice as set forth in the register maintained by the Company, or,
as to each of the foregoing, at the addresses set forth on the signature page
hereto or at such other address as shall be designated by such Person in a
written notice to the other parties complying as to delivery with the terms of
this Section.

      If to the Company: at the address set forth on page 1 hereof, or at such
other address as shall be designated by the Company in a written notice to the
other parties complying as to delivery with the terms of this Section.

      All such notices, requests, demands and other communications shall, when
mailed (which mailing must be accomplished by first class mail, postage prepaid;
electronic facsimile transmission; express overnight courier service; or
registered or certified mail, return receipt requested) or telegraphed, and
shall be considered to be delivered three (3) days after dispatch or upon
receipt.

      (f) Binding Effect; Assignment. This Agreement shall be binding upon and
inure to the benefit of the Company and the Investors and their respective
heirs, successors and assigns, except that the Company shall not have the right
to delegate its obligations hereunder or to assign its rights hereunder or any
interest herein without the prior written consent of the holders of all of the
Notes.

      (g) Prior Agreements. This Agreement, the Transaction Documents or other
agreements executed and delivered herewith constitute the entire agreement
between the parties and supersedes any prior understandings or agreements
concerning the subject matter hereof.

      (h) Severability. The provisions of this Agreement and the terms of the
Notes and the Warrants are severable and, in the event that any court of
competent jurisdiction shall determine that any one or more of the provisions or
part of a provision contained in this Agreement or the terms of the Notes or the
Warrants shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision or part of a provision of this Agreement or the terms of the
Notes and the Warrants, but this Agreement and the terms of the Notes and the
Warrants shall be reformed and construed as if such invalid or illegal or
unenforceable provision, or part of a provision, had never been contained
herein, and such provisions or part reformed so that it would be valid, legal
and enforceable to the maximum extent possible.

      (i) Confidentiality. Each Investor agrees that it will keep confidential
and will not disclose or divulge any confidential, proprietary or secret
information which such Investor may obtain from the Company pursuant to
financial statements, reports and other materials submitted by the Company to
such Investor pursuant to this Agreement, or pursuant to visitation or
inspection rights previously granted to any Investor, unless such information is
known, or until such information becomes known, to the public; provided,
however, that a Investor may disclose such information (i) on a confidential
basis to its attorneys, accountants, consultants and other professionals to the
extent necessary to obtain their services in connection with its investment in
the Company, (ii) to any prospective purchaser of any of the Notes and the
Warrants from such Investor as long as such prospective purchaser agrees in
writing to be bound by the provisions of
<PAGE>

this Section 6.9, (iii) to any affiliate or partner of such Investor and (iv) as
required by applicable law.

      (j) Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of New York without regard to the choice of law principles
thereof. Each of the parties hereto irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York located in New York County
and the United States District Court for the Southern District of New York for
the purpose of any suit, action, proceeding or judgment relating to or arising
out of this Agreement and the transactions contemplated hereby. Service of
process in connection with any such suit, action or proceeding may be served on
each party hereto anywhere in the world by the same methods as are specified for
the giving of notices under this Agreement. Each of the parties hereto
irrevocably consents to the jurisdiction of any such court in any such suit,
action or proceeding and to the laying of venue in such court. Each party hereto
irrevocably waives any objection to the laying of venue of any such suit, action
or proceeding brought in such courts and irrevocably waives any claim that any
such suit, action or proceeding brought in any such court has been brought in an
inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A
TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS
THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

      (k) Headings. Article, section and subsection headings in this Agreement
are included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.

      (l) Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.

      (m) Further Assurances. From and after the date of this Agreement, upon
the request of any Investor or the Company, the Company and the Investors shall
execute and deliver such instruments, documents and other writings as may be
reasonably necessary or desirable to confirm and carry out and to effectuate
fully the intent and purposes of this Agreement and the Transaction Documents.

      (n) Independent Nature of Investors' Obligations and Rights. The
obligations of each Investor under any Transaction Document are several and not
joint with the obligations of any other Investor, and no Investor shall be
responsible in any way for the performance of the obligations of any other
Investor under any Transaction Document. The decision of each Investor to
purchase Securities pursuant to the Transaction Documents has been made by such
Investor independently of any other Investor. Nothing contained herein or in any
Transaction Document, and no action taken by any Investor pursuant thereto,
shall be deemed to constitute the Investors as a partnership, an association, a
joint venture or any other kind of entity, or create a presumption that the
Investors are in any way acting in concert or as a group with respect to such
obligations or the transactions contemplated by the Transaction Documents. Each
Investor acknowledges that no other Investor has acted as agent for such
Investor in connection with making its investment hereunder and that no Investor
will be acting as agent of such Investor in

<PAGE>

connection with monitoring its investment in the Securities or enforcing its
rights under the Transaction Documents. The Company acknowledges that each of
the Investors has been provided with the same Transaction Documents for the
purpose of closing a transaction with multiple Investors and not because it was
required or requested to do so by any Investor.

      (o) Expenses. The parties hereto shall pay their own costs and expenses in
connection with the sale of the Notes pursuant to this Agreement, except that
the Company shall pay Crestview Capital Master, LLC $25,000 at Closing for legal
fees and due diligence costs. The Company shall reimburse the Investors upon
demand for all reasonable out-of-pocket expenses incurred by the Investors,
including without limitation reimbursement of attorneys' fees and disbursements,
in connection with any amendment, modification or waiver of this Agreement or
the other Transaction Documents. In the event that legal proceedings are
commenced by any party to this Agreement against another party to this Agreement
in connection with this Agreement or the other Transaction Documents, the party
or parties which do not prevail in such proceedings shall severally, but not
jointly, pay their pro rata share of the reasonable attorneys' fees and other
reasonable out-of-pocket costs and expenses incurred by the prevailing party in
such proceedings.

      13. Additional Definitions. In addition to those terms defined above and
elsewhere in this Agreement, for the purposes of this Agreement, the following
terms shall have the meanings set forth below:

            "Affiliate" means, with respect to any Person, any other Person
which directly or indirectly through one or more intermediaries Controls, is
controlled by, or is under common control with, such Person.

            "Agreement" means this Subscription Agreement.

            "Amendment" means an Amendment to the Company's Articles of
Incorporation to increase the Company's authorized shares of Common Stock.

            "Business Day" means a day, other than a Saturday or Sunday, on
which banks in New York City are open for the general transaction of business.

            "Company's Knowledge" means the actual knowledge of the executive
officers (as defined in Rule 405 under the Securities Act) of the Company, after
due inquiry.

            "Confidential Information" means trade secrets, confidential
information and know-how (including but not limited to ideas, formulae,
compositions, processes, procedures and techniques, research and development
information, computer program code, performance specifications, support
documentation, drawings, specifications, designs, business and marketing plans,
and customer and supplier lists and related information).

            "Control" (including the terms "controlling", "controlled by" or
"under common control with") means the possession, direct or indirect, of the
power to direct or cause the direction of the management and policies of a
Person, whether through the ownership of voting

<PAGE>

securities, by contract or otherwise.

            "Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any successor statute, and the rules and regulations promulgated
thereunder.

            "Gupta Purchase Agreement" means that certain Membership Interest
Purchase Agreement, described in the SEC Filings, as assigned to and assumed by
the Company, and as amended, which provides for the acquisition of the
membership interests of Gupta.

            "Intellectual Property" means all of the following: (i) patents,
patent applications, patent disclosures and inventions (whether or not
patentable and whether or not reduced to practice); (ii) trademarks, service
marks, trade dress, trade names, corporate names, logos, slogans and Internet
domain names, together with all goodwill associated with each of the foregoing;
(iii) copyrights and copyrightable works; (iv) registrations, applications and
renewals for any of the foregoing; and (v) proprietary computer software
(including but not limited to data, data bases and documentation).

            "Material Adverse Effect" means a material adverse effect on (i) the
assets, liabilities, results of operations, condition (financial or otherwise),
business, or prospects of the Company and its Subsidiaries taken as a whole, or
(ii) the ability of the Company to perform its obligations under the Transaction
Documents.

            "Person" means an individual, corporation, partnership, limited
liability company, trust, business trust, association, joint stock company,
joint venture, sole proprietorship, unincorporated organization, governmental
authority or any other form of entity not specifically listed herein.

            "SEC Filings" has the meaning set forth in Section 5(f).

            "Securities Act" means the Securities Act of 1933, as amended, or
any successor statute, and the rules and regulations promulgated thereunder.

            "Subsidiary" of any Person means another Person, an amount of the
voting securities, other voting ownership or voting partnership interests of
which is sufficient to elect at least a majority of its Board of Directors or
other governing body (or, if there are no such voting interests, 50% or more of
the equity interests of which) is owned directly or indirectly by such first
Person.

            "Transaction Documents" means this Subscription Agreement, the
Notes, the Series C Certificate of Designations, the Amendment and the Warrants.

                                    * * * * *

       [The remainder of this page is blank; the Signature Pages follow.]

<PAGE>

                                 SIGNATURE PAGES

IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement
this ___day of ____________, 2005.

____________________________               Address: ________________________
Signature of Investor
                                                    ________________________

____________________________               Telephone: ______________________
Print Name of Investor
                                           Facsimile: ______________________
____________________________
Print Title of individual signing on       Email: __________________________
behalf of an entity, if applicable

Investor's Social Security or Federal
Tax Identification Number: ____________

____________________________________       Co-owner's
Signature of Co-owner, if applicable       Address: ________________________

                                                    ________________________

Co-Owners Social Security or Federal       Co-Owner's
Tax Identification Number: ____________
                                           Telephone: ______________________

                                           Facsimile: ______________________

                                           Email:  _________________________

If Joint Ownership, check one (all         If Investor is an entity, complete:
parties must sign above):

( ) Joint Tenants with Right of            _________________________________
    Survivorship                           Legal Form of Entity
( ) Tenants in Common
( ) Community Property                     __________________________
                                           Jurisdiction of Organization

<PAGE>

If Fiduciary, check one:

( ) Trust
( ) Estate
( ) Power of Attorney
( ) Investment Adviser (with investment
discretion)

And identify beneficiaries:

____________________________

Accepted and agreed as of _________________, 2005:

Warp Technology Holdings, Inc.

By: _______________________________

Name: _____________________________

Title: ____________________________

                          CONSIDERATION TO BE DELIVERED

Series C Convertible Note in principal amount of: $__________________

Amount to be Paid by Investor: $__________________

<PAGE>

ACCREDITED INVESTOR CERTIFICATE

      The undersigned investor hereby certifies that he is an Accredited
Investor as that term is defined in Regulation D adopted pursuant to the
Securities Act of 1933 (the "Act"). The specific category(s) of Accredited
Investor applicable to the undersigned is checked below.

_____a.     an individual whose individual net worth, or joint net worth with
            that individual's spouse, exceeds $1,000,000 (including the value of
            homes, home furnishings and personal automobiles);

_____b.     an individual who had an individual income in excess of $200,000 in
            2003 and 2004 or joint income with that person's spouse in excess of
            $300,000 in each of those years and who reasonably expects to reach
            the same income level in 2005. For purposes of this offering,
            individual income shall equal adjusted gross income, as reported in
            the investor's federal income tax return, less any income
            attributable to a spouse or to property owned by the spouse, and as
            may be further adjusted in accordance with the rules, regulations,
            and releases of the SEC;

_____c.     a bank as defined in Section 3(a)(2) of the Securities Act of 1933,
            as amended (the "Act"), or a savings and loan association or other
            institution as defined in Section 3(a)(5)(A) of the Act, whether
            acting in its individual or fiduciary capacity; an insurance company
            as defined in Section 2(13) of the Act; an investment company
            registered under the Investment Company Act of 1940 (the "1940 Act")
            or a business development company as defined in Section 2(a)(48) of
            the 1940 Act; a Small Business Investment Company licensed by the
            U.S. Small Business Administration under Section 301(c) or (d) of
            the Small Business Investment Act of 1958; or an employee benefit
            plan within the meaning of Title I of the Employee Retirement Income
            Security Act of 1974 ("ERISA"), if the investment decision is made
            by a plan fiduciary, as defined in Section 3(21) of ERISA, which is
            either a bank, savings and loan association, insurance company or
            registered investment adviser, or if the employee benefit plan has
            total assets in excess of $5,000,000 or if a self-directed plan,
            with investment decisions made solely by persons that are accredited
            investors;

_____d.     a private business development company as defined in Section
            202(a)(22) of the Investment Advisers Act of 1940;

_____e.     an organization described in Section 501(c)(3) of the Internal
            Revenue Code, corporation, Massachusetts or similar business trust,
            or partnership, not formed for the specific purpose of acquiring the
            Notes, with total assets in excess of $5,000,000;

_____f.     an individual who is a director or executive officer of the Company;
            or

_____g.     an entity in which all of the equity owners are accredited investors
            as set forth above.

<PAGE>

      IN WITNESS WHEREOF, the undersigned has executed this Accredited Investor
Certificate this day of , 2005.

____________________________
Signature of Investor

____________________________
Print Name of Investor

_________________________________________________
Print Title of individual signing on behalf of an
entity, if applicable<PAGE>

                                                                   EXHIBIT 10.37

                              INVESTORS' AGREEMENT

      This Investors' Agreement (this "Agreement") is entered into this ___ day
of January, 2005 by and among WARP Technology Holdings, Inc., a Nevada
corporation (the "Company"), and the persons listed on Exhibit A hereto (the
"Investors").

                                    RECITALS

      1. The Company and certain of the Investors have entered into certain
subscription agreements (collectively, the "Subscription Agreements") for the
purchase and sale of certain Series C Convertible Notes, in an aggregate
principal amount of up to $14,000,000 (the "Notes"), which are convertible,
automatically upon the occurrence of certain events, into (i) an aggregate of up
to 14,000,000 shares (the "Series C Shares") of the Company's Series C Preferred
Stock, par value $.00001 per share (the "Series C Stock"), and (ii) warrants to
acquire up to an aggregate of up to 14,000,000 shares of the Company's common
stock, par value $.00001 per share (the "Common Stock"), all on the terms and
conditions set forth herein and in such other documents referenced in that
certain Confidential Private Offering Memorandum dated as of January 15, 2005
(as amended and completed, the "Memorandum").

      2. The Company and certain of the Investors have entered in to a Senior
Note and Warrant Purchase Agreement (the "Senior Note Agreement") and the
Company and certain of the Investors have entered into a Senior Subordinated
Note and Warrant Purchase Agreement (the "Mezz Note Agreement"). The notes
issues pursuant to the Senior Note Agreement and the Mezz Note Agreement are
referred to collectively as the "Other Notes".

      3. The warrants described in Recital 1 and the warrants issued pursuant to
the Senior Note Agreement (both the Initial Warrants and the Additional
Warrants, as defined in such Senior Note Agreement) and the Mezz Note Agreement
are collectively referred to herein as the "Warrants". All capitalized terms not
otherwise defined herein shall have the meanings ascribed to them in the
Subscription Agreements or the Certificate of Designations, Preferences and
Rights of the Series C Stock (the "Certificate of Designations").

      4. A condition to each Investor's obligations under the Subscription
Agreements, the Senior Note Agreement and the Mezz Note Agreement, as
applicable, is that the parties hereto enter into this Agreement in order to
provide the Investors with certain rights to register the Conversion Shares.

                                    AGREEMENT

      The parties hereby agree as follows:

      1. Definitions. For purposes of this Agreement (terms defined in the
singular shall apply to the plural form and vice-versa):

            1.1 The terms "register," "registered," and "registration" refer to
a registration effected by preparing and filing a Registration Statement or
similar document in compliance with
<PAGE>

the Securities Act of 1933, as amended (the "Act"), and the declaration or
ordering of effectiveness of such Registration Statement or document by the SEC;

            1.2 The term "Conversion Shares" means (i) the shares of Common
Stock issuable on conversion of the shares of Series C Stock, on exercise of the
Warrants and on conversion of certain of the notes issued pursuant to the Mezz
Note Agreement (but not the Gupta Note, as defined therein), and (ii) any other
shares of Common Stock of the Company issued as (or issuable upon the conversion
or exercise of any warrant, right or other security which is issued as) a
dividend or other distribution with respect to, or in exchange for or in
replacement of, such shares. Notwithstanding the foregoing, Common Stock or
other securities shall only be treated as Conversion Shares if and so long as
they have not (A) been sold to or through a broker or dealer or underwriter in a
public distribution or a public securities transaction, or (B) been sold in a
transaction exempt from the registration and prospectus delivery requirements of
the Act under Section 4(1) thereof so that all transfer restrictions, and
restrictive legends with respect thereto, if any, are removed upon the
consummation of such sale or (C) with regard to any individual Investor, become
eligible for sale pursuant to Rule 144(k).

      2. Registration Rights for Conversion Shares.

            2.1 Registration of Conversion Shares. The Company shall, within
forty-five (45) days after the closing (the "Closing") of the sale of the Notes
and the transactions described in the Senior Note Agreement and the Mezz Note
Agreement, complete all required audits and make all related filings concerning
the acquisition of Gupta Technologies, LLC ("Gupta"). Within fifteen (15) days
after the end of the 45-day period referred to in the preceding sentence (the
"Filing Deadline"), the Company shall file a registration statement on Form SB-2
or an equally suitable registration statement (the "Registration Statement") for
the purpose of registering all of the Conversion Shares for resale. The Company
shall use its best efforts to cause such Registration Statement to be declared
effective by the Securities and Exchange Commission (the "SEC") at the earliest
practicable date thereafter. If (i) the Registration Statement has not been
filed with the SEC by the Filing Deadline or (ii) the Registration Statement has
not been declared effective by the SEC before the date that is ninety (90) days
after the Filing Deadline or, in the event of a review of the Registration
Statement by the SEC, one hundred and twenty (120) days after the Filing
Deadline (the "Effectiveness Deadline") or (iii) after the Registration
Statement is declared effective, the Registration Statement or related
prospectus ceases for any reason to be available to the Investors as to all
Conversion Shares the offer and sale of which it is required to cover at any
time prior to the expiration of the Effectiveness Period (as defined below)
(whether due to the Registration Statement ceasing for any reason to be
effective or because use of the prospectus has been suspended for any reason,
including, without limitation, pursuant to Section 3(j) hereof) for an aggregate
of more than twenty (20) consecutive trading days or an aggregate of forty (40)
trading days (which need not be consecutive) in any twelve (12) month period,
the Company will pay to the Investors an amount in cash equal to 2% of the
Series C Face Amount of the Series C Preferred Stock and 2% of the face value of
the Other Notes. If the Registration Statement has not been filed or declared
effective before the date that is thirty (30) days after the Filing Deadline or
the Effectiveness Deadline, as applicable, or continues to be unavailable to the
Investors for longer than the periods described above, the Company will pay to
each Investor an additional amount equal to 2% of the Series C Face Amount of
the Series C Preferred Stock and/or 2% of the face value of

                                      -2-
<PAGE>

the Other Notes held by such Investor, and will continue to pay such 2% monthly
penalties every thirty days until such Registration Statement is filed, declared
effective and available to the Investors. All such payments will be treated as
liquidated damages, and shall be the sole and exclusive remedy for delay in
having the Registration Statement filed, declared effective and remain available
to Investors throughout the Effectiveness Period. The Company will use its best
efforts to keep the Registration Statement effective (the "Effectiveness
Period") (subject to reasonable blackout provisions as may be required in order
to comply with the securities laws) until the earlier of: (i) twenty four (24)
months after the date that the Registration Statement is declared effective by
the SEC; (ii) the date when all of the Conversion Shares covered by the
Registration Statement are sold; or (iii) the date when Rule 144(k) is available
with respect to all of the securities covered by such Registration Statement. It
is agreed and understood that the Company shall, from time to time, be obligated
to file an additional Registration Statement (or an amendment to the
Registration Statement) to cover any Conversion Shares which are not registered
for resale pursuant to a pre-existing Registration Statement.

            2.2 Representations of Investors. Each Investor hereby represents to
and covenants with the Company that, during the period in which any Registration
Statement effected pursuant to Section 2 remains effective, such Investor will:

                  (a) not engage in any stabilization activity in connection
with any of the Company's securities;

                  (b) cause to be furnished to any purchaser of the Conversion
Shares and to the broker-dealer, if any, through whom Conversion Shares may be
offered, a copy of the final prospectus relating to such Registration Statement;
and

                  (c) not bid for or purchase any securities of the Company or
any rights to acquire the Company's securities, or attempt to induce any person
to purchase any of the Company's securities or any rights to acquire the
Company's securities, in each case, other than as permitted under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").

            2.3 Information for Use in Registration Statement. Each Investor
covenants to the Company that such Investor will complete the information
requested by the Selling Investor's Questionnaire attached as Exhibit B hereto
(the "Questionnaire"), and further covenants to the Company that all information
provided by such Investor in the Questionnaire will be true, accurate and
complete as of the date provided. Each Investor understands that the written
information in the Questionnaire and all written representations made in this
Agreement are being provided to the Company specifically for use in, or in
connection with, the Registration Statement and the prospectus contained
therein, and has executed this Agreement with such knowledge.

            2.4 Investors' Piggy-Back Registrations. If at any time after the
Filing Deadline and prior to the expiration of the Effectiveness Period there is
not an effective Registration Statement covering all of the Conversion Shares
and the Company shall determine to prepare and file, or has filed, with the SEC
a registration statement relating to an offering for its own account or the
account of others under the Act of any of its equity securities, other than (i)
on Form S-4 or Form S-8 (each as promulgated under the Act) or their then
equivalents

                                      -3-
<PAGE>

relating to equity securities to be issued solely in connection with an
acquisition of any entity or business or equity securities issuable in
connection with stock option or other employee benefit plans or (ii) on Form S-3
(as promulgated under the Act) or its then equivalent relating to equity
securities to be issued solely in connection with a dividend reinvestment plan,
then the Company shall send to each Investor written notice of such
determination and, if within fifteen (15) days after receipt of such notice, any
such Investor shall so request in writing, the Company shall include in such
registration statement all or any part of such Conversion Shares such Investor
requests to be registered, subject to customary underwriter cutbacks applicable
to all holders of registration rights.

      3. Registration Procedures. In connection with the Company's registration
obligations hereunder, the Company shall:

            (a) Not less than five (5) trading days prior to the filing of a
Registration Statement or any related prospectus or any amendment or supplement
thereto, furnish to the Investors copies of all such documents proposed to be
filed which documents (other than those incorporated by reference) will be
subject to the review of such Investors. The Company shall not file a
Registration Statement or any such prospectus or any amendments or supplements
thereto to which the Investors holding a majority of the Conversion Shares shall
reasonably object in writing in good faith unless and until the Company shall
have reasonably responded to the written comments of such Investors, including,
without limitation, by making such changes to such Registration Statement or any
related prospectus or any amendment thereto as are necessary to reasonably
address such objection.

            (b) (i) Prepare and file with the SEC such amendments, including
post-effective amendments, to each Registration Statement and the prospectus
used in connection therewith as may be necessary to (x) keep such Registration
Statement continuously effective for the Effectiveness Period, and (y) include
any Conversion Shares held by any person who becomes a successor or assign of an
Investor (a "Successor Holder"); such amendment shall be filed promptly after
notice of transfer by an Investor to such Successor Holder has been provided to
the Company (provided, that if the inclusion of Conversion Shares held by a
Successor Holder may be accomplished by a prospectus supplement, the Company
may, in lieu of filing an amendment to the Registration Statement, promptly
prepare and file pursuant to Rule 424 such prospectus supplement); (ii) cause
the related prospectus to be amended or supplemented by any required prospectus
supplement, and as so supplemented or amended to be filed pursuant to Rule 424;
(iii) respond as promptly as reasonably possible, and in any event within ten
trading days, to any comments received from the SEC with respect to each
Registration Statement or any amendment thereto and, as promptly as reasonably
possible provide to the Investors true and complete copies of all correspondence
from and to the SEC relating to such Registration Statement that pertains to the
Investors as selling stockholders but not any comments that would result in the
disclosure to the Investors of material and non-public information concerning
the Company; (iv) prepare and file with the SEC such additional Registration
Statements as may be required in order to register for resale under the Act all
of the Conversion Shares; and (v) comply in all material respects with the
provisions of the Act and the Exchange Act with respect to each Registration
Statement and the disposition of all Conversion Shares covered by each
Registration Statement.

                                      -4-
<PAGE>

            (c) Notify the Investors in writing no later than two trading days
following the day (i)(A) when the SEC notifies the Company whether there will be
a "review" of such Registration Statement and whenever the SEC comments in
writing on such Registration Statement (the Company shall provide to each of the
Investors true and complete copies thereof and all written responses thereto
that pertain to the Investors as selling stockholders or to the Plan of
Distribution, but not information which the Company reasonably believes would
constitute material and non-public information); and (B) with respect to each
Registration Statement or any post-effective amendment, when the same has become
effective; (ii) of any request by the SEC or any other federal or state
governmental authority for amendments or supplements to a Registration Statement
or prospectus or for additional information that pertains to the Investors as
selling stockholders or the Plan of Distribution; (iii) of the issuance by the
SEC of any stop order suspending the effectiveness of a Registration Statement
covering any or all of the Conversion Shares or the initiation of any
proceedings for that purpose; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Conversion Shares for sale in any jurisdiction,
or the initiation or threatening of any proceeding for such purpose; and (v)
subject to Section 3(j), of the occurrence of any event or passage of time that
makes the financial statements included in a Registration Statement ineligible
for inclusion therein or any statement made in such Registration Statement or
prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires any revisions to such
Registration Statement, prospectus or other documents so that, in the case of
such Registration Statement or the prospectus, as the case may be, it will not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.

            (d) Use its reasonable best efforts to avoid the issuance of, or, if
issued, to obtain the withdrawal of (i) any order suspending the effectiveness
of a Registration Statement, or (ii) any suspension of the qualification (or
exemption from qualification) of any of the Conversion Shares for sale in any
jurisdiction, at the earliest practicable moment.

            (e) Furnish to each Investor, without charge, at least one conformed
copy of each Registration Statement and each amendment thereto and all exhibits
to the extent requested by such Investor (including those previously furnished
or incorporated by reference) promptly after the filing of such documents with
the SEC.

            (f) Promptly deliver to each Investor, without charge, as many
copies of each prospectus or prospectuses and each amendment or supplement
thereto as such Investor may reasonably request. The Company hereby consents to
the use of such prospectus and each amendment or supplement thereto by each of
the Investors in connection with the offering and sale of the Conversion Shares
covered by such prospectus and any amendment or supplement thereto.

            (g) Prior to any public offering of Conversion Shares, use its
reasonable best efforts to register or qualify or cooperate with the Investors
in connection with the registration or qualification (or exemption from such
registration or qualification) of such Conversion Shares

                                      -5-
<PAGE>

for offer and sale under the securities or Blue Sky laws of those jurisdictions
within the United States identified by each Investor to keep each such
registration or qualification (or exemption therefrom) effective during the
Effectiveness Period and to do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Conversion
Shares covered by the Registration Statements; provided, that the Company shall
not be required to qualify generally to do business or file a general consent to
service of process in any jurisdiction where it is not then so qualified or
subject the Company to any material tax in any such jurisdiction where it is not
then so subject .

            (h) Cooperate with the Investors to facilitate the timely
preparation and delivery of certificates representing Conversion Shares to be
delivered to a purchaser pursuant to the Registration Statements, which
certificates shall be free of all restrictive legends, and to enable such
Conversion Shares to be in such denominations and registered in such names as
any such Investors may request.

            (i) Upon the occurrence of any event contemplated by Section
3(c)(v), as promptly as reasonably possible, prepare a supplement or amendment,
including a post-effective amendment, to the affected Registration Statement or
a supplement to the related prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, no Registration Statement nor any prospectus will
contain an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.

            (j) The Company may require each selling Investor to furnish to the
Company a certified statement as to the number of shares of Common Stock
beneficially owned by such Investor and any affiliate thereof and as to any
other information for such Investor which the SEC requires to be disclosed in
any Registration Statements. For not more than twenty (20) consecutive days or
for a total of not more than forty (40) days in any twelve (12) month period,
the Company may suspend the use of any prospectus included in any Registration
Statement in connection with any of the events described in Section 3(c)(ii)-(v)
(an "Allowed Delay"); provided, that the Company shall promptly (a) notify the
Investors in writing of the existence of (but in no event, without the prior
written consent of an Investor, shall the Company disclose to such Investor any
of the facts or circumstances regarding) material non-public information giving
rise to an Allowed Delay, (b) advise the Investors in writing to cease all sales
under the Registration Statement until the end of the Allowed Delay and (c) use
reasonable efforts to terminate an Allowed Delay as promptly as practicable. The
periods set forth in Section 2.1 shall not be tolled during any Allowed Delay.

            (k) Comply with all applicable rules and regulations of the SEC.

      4. Registration Expenses. All fees and expenses incident to the Company's
performance of its obligation under this Agreement (excluding any underwriting
discounts and selling commissions and all legal fees and expenses of legal
counsel for any Investor, other than one counsel designated by the Investors of
no less than a majority of the Conversion Shares then outstanding, whose fees
and expenses shall be borne by the Company up to an aggregate amount of $50,000)
shall be borne by the Company whether or not any Conversion Shares are sold

                                      -6-
<PAGE>

pursuant to a Registration Statement. The fees and expenses referred to in the
foregoing sentence shall include, without limitation, (i) all registration and
filing fees (including, without limitation, fees and expenses (A) payable to the
SEC in connection with the filing of a Registration Statement, (B) with respect
to filings required to be made with the trading market on which the Common Stock
is then listed for trading, and (C) in compliance with applicable state
securities or Blue Sky laws), (ii) printing expenses (including, without
limitation, expenses of printing certificates for Conversion Shares and of
printing prospectuses if the printing of prospectuses is reasonably requested by
the holders of a majority of the Conversion Shares included in the Registration
Statement), (iii) messenger, telephone and delivery expenses, (iv) fees and
disbursements of counsel for the Company, (v) Act liability insurance, if the
Company so desires such insurance, and (vi) fees and expenses of all other
persons retained by the Company in connection with the consummation of the
transactions contemplated by this Agreement. In addition, the Company shall be
responsible for all of its internal expenses incurred in connection with the
consummation of the transactions contemplated by this Agreement (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual or other audit
or review of its financial statements and the fees and expenses incurred in
connection with the listing of the Conversion Shares on any securities exchange
as required hereunder.

      5. Indemnification.

            (a) Indemnification by the Company. The Company shall,
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Investor, the officers, directors, agents, investment advisors, partners,
members, shareholders and employees of each of them, each person who controls
any such Investor (within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act) and the officers, directors, agents and employees of each such
controlling person, to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, costs (including,
without limitation, reasonable costs of preparation and reasonable attorneys'
fees) and expenses (collectively, "Losses"), as incurred, arising out of or
relating to any untrue or alleged untrue statement of a material fact contained
in any Registration Statement, any prospectus or in any amendment or supplement
thereto or in any preliminary prospectus, or arising out of or relating to any
omission or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein (in the case of any prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading, except to the extent, but only to the extent (1) that such
untrue statements or omissions are based solely upon information regarding such
Investor furnished in writing to the Company by such Investor expressly for use
therein, or to the extent that such information relates to such Investor or such
Investor's proposed method of distribution of Conversion Shares and was reviewed
and expressly approved in writing by such Investor expressly for use in the
Registration Statement (it being understood that each Investor has approved the
Plan of Distribution attached hereto as Annex A for this purpose), such
prospectus or in any amendment or supplement thereto, (2) arising from any offer
or sale of Conversion Shares during a period in which the Company has suspended
use of the prospectus pursuant to Section 3(c)(ii)-(v) and of which suspension
such Investor has been provided notice by the Company prior to such offer or
sale, or (3) if such Investor fails to deliver, within the time required by the
Act, a prospectus that is amended or supplemented, to the extent, but only to
the extent, that such prospectus, as amended or supplemented, would have
corrected the untrue statement or omission or alleged

                                      -7-
<PAGE>

untrue statement or omission of a material fact giving rise to such Loss
contained in the prospectus delivered by such Investor, so long as the
prospectus, as amended or supplemented, has been delivered to such Investor by
the Company reasonably prior to such time. The Company shall notify the
Investors promptly of the institution, threat or assertion of any proceeding of
which the Company is aware in connection with the transactions contemplated by
this Agreement.

            (b) Indemnification by Investors. Each Investor shall,
notwithstanding any termination of this Agreement, severally and not jointly,
indemnify and hold harmless the Company, its directors, officers, agents and
employees, each person who controls the Company (within the meaning of Section
15 of the Act and Section 20 of the Exchange Act), and the directors, officers,
agents or employees of such controlling persons, to the fullest extent permitted
by applicable law, from and against all Losses, as incurred, arising solely out
of or based solely upon: any untrue statement of a material fact contained in
any Registration Statement, any prospectus, or in any amendment or supplement
thereto, or arising solely out of or based solely upon any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading to the extent, but only to the extent (1) that such
untrue statements or omissions are based solely upon information regarding such
Investor furnished in writing to the Company by such Investor expressly for use
therein, or to the extent that such information relates to such Investor or such
Investor's proposed method of distribution of Conversion Shares and was reviewed
and expressly approved in writing by such Investor expressly for use in the
Registration Statement (it being understood that each Investor has approved the
Plan of Distribution attached hereto as Annex A for this purpose), such
prospectus or in any amendment or supplement thereto, (2) arising from any offer
or sale of Conversion Shares during a period in which the Company has suspended
use of the prospectus pursuant to Section 3(c)(ii)-(v) and of which suspension
such Investor has been provided notice by the Company prior to such offer or
sale, or (3) if such Investor fails to deliver, within the time required by the
Act, a prospectus that is amended or supplemented, to the extent, but solely to
the extent, that such prospectus, as amended or supplemented, would have
corrected the untrue statement or omission or alleged untrue statement or
omission of a material fact giving rise to such Loss contained in the prospectus
delivered by such Investor, so long as the prospectus, as amended or
supplemented, has been delivered to such Investor by the Company reasonably
prior to such time. In no event shall the liability of any selling Investor
hereunder be greater in amount than the dollar amount of the net proceeds
received by such Investor upon the sale of the Conversion Shares giving rise to
such indemnification obligation.

            (c) Conduct of Indemnification Proceedings. If any proceeding shall
be brought or asserted against any person entitled to indemnity hereunder (an
"Indemnified Party"), such Indemnified Party shall promptly notify the person
from whom indemnity is sought (the "Indemnifying Party") in writing, and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the Indemnified Party and the payment of all
fees and expenses incurred in connection with the defense thereof; provided,
that the failure of any Indemnified Party to give such notice shall not relieve
the Indemnifying Party of its obligations or liabilities pursuant to this
Agreement, except (and only) to the extent that it shall be finally determined
by a court of competent jurisdiction (which determination is not subject to
appeal or further review) that such failure shall have proximately and
materially adversely prejudiced the Indemnifying Party.

                                      -8-
<PAGE>

            An Indemnified Party shall have the right to employ separate counsel
in any such proceeding and to participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party
or Parties unless: (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses; (2) the Indemnifying Party shall have failed promptly to
assume the defense of such proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such proceeding; or (3) the named
parties to any such proceeding (including any impleaded parties) include both
such Indemnified Party and the Indemnifying Party, and such Indemnified Party
shall have been advised by counsel that a conflict of interest is likely to
exist if the same counsel were to represent such Indemnified Party and the
Indemnifying Party (in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof and such counsel shall be at the expense of
the Indemnifying Party), provided, that the Indemnifying Party shall not be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all Indemnified Parties. The
Indemnifying Party shall not be liable for any settlement of any such proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending proceeding in respect of
which any Indemnified Party is or could have been a party, unless such
settlement includes an unconditional release of such Indemnified Party from all
liability on claims that are the subject matter of such proceeding.

            All reasonable fees and expenses of the Indemnified Party (including
reasonable fees and expenses to the extent incurred in connection with
investigating or defending such proceeding) shall be paid to the Indemnified
Party, as incurred, within ten trading days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined that an
Indemnified Party is not entitled to indemnification hereunder; provided, that
the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder).

            (d) Contribution. If a claim for indemnification under Section 5(a)
or 5(b) is unavailable to an Indemnified Party (by reason of public policy or
otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission.

            The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 5(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the

                                      -9-
<PAGE>

immediately preceding paragraph. Notwithstanding the provisions of this Section
5(d), no Investor shall be required to contribute, in the aggregate, any amount
in excess of the amount by which the proceeds actually received by such Investor
from the sale of the Conversion Shares subject to the proceeding exceeds the
amount of any damages that such Investor has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission.

            The indemnity and contribution agreements contained in this Section
are in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.

      6. Shares. The term "Shares" as used herein shall mean shares of Series C
Stock and the shares of Common Stock issued upon the conversion of the Series C
Stock or upon the exercise of the Warrants. Nothing contained herein shall be
construed as to restrict the ability of an Investor to sell, transfer or
otherwise dispose of any Shares owned by such Investor.

      7. Transferability.

            7.1 In General. Nothing herein shall limit the right of an Investor
to sell, convey or transfer any of his Shares. The Shares may be disposed of
only pursuant to an effective registration statement under the Act, to the
Company or pursuant to an available exemption from or in a transaction not
subject to the registration requirements of the Act, and in compliance with any
applicable state securities laws. In connection with any transfer of the Shares
other than pursuant to an effective registration statement, to the Company, to
an affiliate of an Investor or in connection with a pledge as contemplated
below, the Company may require the transferor thereof to provide to the Company
an opinion of counsel selected by the transferor and acceptable to the Company
(such acceptance not to be unreasonably withheld), the form and substance of
which opinion shall be reasonably satisfactory to the Company, to the effect
that such transfer does not require registration of such transferred Shares
under the Act. The Company acknowledges and agrees that an Investor may from
time to time pledge, and/or grant a security interest in some or all of the
Shares, in accordance with applicable securities laws, pursuant to a bona fide
margin agreement in connection with a bona fide margin account and, if required
under the terms of such agreement or account, such Investor may transfer pledged
or secured Shares to the pledgees or secured parties. Such a pledge or transfer
would not be subject to approval or consent of the Company and no legal opinion
of legal counsel to the pledgee, secured party or pledgor shall be required in
connection with the pledge, but such legal opinion may be required in connection
with a subsequent transfer, following default by the Investor, to the transferee
of the pledge. No notice shall be required of such pledge. The Company will
execute and deliver such reasonable documentation as a pledgee or secured party
of Shares may reasonably request in connection with a pledge or transfer of the
Shares including, without limitation, the preparation and filing of any required
prospectus supplement under Rule 424(b)(3) of the Act or other applicable
provision of the Act to appropriately amend the list of selling stockholders
thereunder.

                                      -10-
<PAGE>

            7.2 Legend. Certificates evidencing the Shares will contain the
following legend, so long as is required by this Section 7 and applicable law:

           THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
           EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
           RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
           OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
           BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
           STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
           EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
           REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE
           STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO
           THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE
           REASONABLY ACCEPTABLE TO THE COMPANY. THESE SECURITIES MAY BE PLEDGED
           IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT SECURED BY SUCH
           SECURITIES.

            7.3 Removal of Legend. Certificates evidencing the Shares shall not
contain any legend (including, without limitation, the legend set forth in
Section 7.2: (i) while a registration statement (including, without limitation,
the Registration Statement) covering the resale of such Shares is effective
under the Act or (ii) following any sale of such Shares pursuant to Rule 144, or
(iii) while such Shares are eligible for sale under Rule 144(k), or (iv) if such
legend is not required under applicable requirements of the Act (including,
without limitation, judicial interpretations and pronouncements issued by the
Staff of the SEC). The Company shall use its best efforts to cause its counsel
to issue any legal opinion or instruction required by the Company's transfer
agent to comply with the requirements set forth in this Section. At such time as
a legend is no longer required for the Shares under this Section 7.3, the
Company will, no later than five trading days following the delivery by an
Investor to the Company or the Company's transfer agent of a certificate
representing Shares containing a restrictive legend, deliver or cause to be
delivered to such Investor a certificate representing such Shares that is free
from all restrictive and other legends. The Company may not make any notation on
its records or give instructions to any transfer agent of the Company that
enlarge the restrictions on transfer set forth in this Section except as it may
reasonably determine, upon written advice of counsel, are necessary to comply or
to ensure compliance with applicable laws; provided, however, that at such time
as such notation or enlarged restrictions are no longer necessary to comply or
to ensure compliance with applicable laws, the Company shall take such actions
as are necessary to immediately eliminate such notation or enlarged
restrictions.

      8. Governing Law. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be governed,
construed and interpreted in accordance with the laws of the State of New York,
without giving effect to principles of conflicts of law.

                                      -11-
<PAGE>

      9. Successors and Assigns. No party may assign its rights or obligations
under this Agreement, except with the prior written consent of the other party,
provided that an Investor may assign its rights and its obligations without
consent to the extent such Investor transfers Shares in accordance with the
terms hereof. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their permitted successors and assigns.

      10. Entire Agreement; Amendment; Termination. This Agreement and the other
documents delivered pursuant hereto constitute the full and entire understanding
and agreement between the parties with regard to the subject matter hereof and
thereof and supersede all prior agreements and understandings among the parties
relating to the subject matter hereof. Neither this Agreement nor any term
hereof may be amended, waived, discharged or terminated other than by a written
instrument signed by the Company and a majority in interest of the Investors and
the Company.

      11. Notices. Unless otherwise provided herein, any notice required or
permitted by this Agreement shall be in writing and shall be deemed duly given
upon delivery, when delivered personally or by overnight courier and addressed
to the party to be notified at such party's address as set forth on the
signature page hereto, or as subsequently modified by written notice. In the
event that any date provided for in this Agreement falls on a Saturday, Sunday
or legal holiday, such date shall be deemed extended to the next business day.

      12. Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.

      13. Captions and Headings. The captions and headings used herein are for
convenience and ease of reference only and are not intended to be a part of or
to affect the meaning or interpretation of this Agreement.

      14. Waiver of Jury Trial. THE COMPANY AND EACH OF THE INVESTORS HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
RELATING TO OR ARISING OUT OF THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY.

      14. Counterparts. This Agreement may be executed in counterparts, and each
such counterpart shall be deemed an original for all purposes.

                                      -12-
<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective authorized representatives as of the date first
written above.

                                    COMPANY:

                                    WARP TECHNOLOGY HOLDINGS, INC.

                                    By: ________________________________________
                                        Name: __________________________________
                                        Title: _________________________________

                                    INVESTORS:

                                    PRINT LEGAL NAME: __________________________

                                    By: ________________________________________
                                        Name: __________________________________
                                        Title: _________________________________

                                      -13-
<PAGE>

                                    EXHIBIT A

                                LIST OF INVESTORS

SUBSCRIPTION AGREEMENTS

NAME OF INVESTOR

Crestview Capital Master, LLC

ISIS Capital Management, LLC

Carmignac Portfolio A/C Carmignac Infotech

Carmignac Gestion A/C Carmignac Technologies

SEB Asset Management

Gupta Holdings, LLC

TCMP(3) Partners

Steven Grodko

SENIOR NOTE AGREEMENT

NAME OF  INVESTOR

Crestview Capital Master, LLC

DCOFI Master LDC

Asset Managers International Ltd.

Gupta Holdings, LLC

B/T Investors, a General Partnership

Griffin Crossover Fund

MEZZ NOTE AGREEMENT

NAME OF INVESTOR

Crestview Capital Master, LLC

DCOFI Master LDC

<PAGE>

                                     ANNEX A

                              PLAN OF DISTRIBUTION

      The selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling shares of common stock or
interests in shares of common stock received after the date of this prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on
any stock exchange, market or trading facility on which the shares are traded or
in private transactions. These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to the
prevailing market price, at varying prices determined at the time of sale, or at
negotiated prices.

      The selling stockholders may use any one or more of the following methods
when disposing of shares or interests therein:

      - ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;

      - block trades in which the broker-dealer will attempt to sell the shares
as agent, but may position and resell a portion of the block as principal to
facilitate the transaction;

      - purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;

      - an exchange distribution in accordance with the rules of the applicable
exchange;

      - privately negotiated transactions;

      - short sales;

      - through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise;

      - broker-dealers may agree with the selling stockholders to sell a
specified number of such shares at a stipulated price per share;

      - a combination of any such methods of sale; and

      - any other method permitted pursuant to applicable law.

      The selling stockholders may, from time to time, pledge or grant a
security interest in some or all of the shares of common stock owned by them
and, if they default in the performance of their secured obligations, the
pledgees or secured parties may offer and sell the shares of common stock, from
time to time, under this prospectus, or under an amendment to this

<PAGE>

prospectus under Rule 424(b)(3) or other applicable provision of the Securities
Act amending the list of selling stockholders to include the pledgee, transferee
or other successors in interest as selling stockholders under this prospectus.
The selling stockholders also may transfer the shares of common stock in other
circumstances, in which case the transferees, pledgees or other successors in
interest will be the selling beneficial owners for purposes of this prospectus.

      In connection with the sale of our common stock or interests therein, the
selling stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of the
common stock in the course of hedging the positions they assume. The selling
stockholders may also sell shares of our common stock short and deliver these
securities to close out their short positions, or loan or pledge the common
stock to broker-dealers that in turn may sell these securities. The selling
stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or the creation of one or more
derivative securities which require the delivery to such broker-dealer or other
financial institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).

      The aggregate proceeds to the selling stockholders from the sale of the
common stock offered by them will be the purchase price of the common stock less
discounts or commissions, if any. Each of the selling stockholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of common stock to be made directly or
through agents. We will not receive any of the proceeds from this offering. Upon
any exercise of the warrants by payment of cash, however, we will receive the
exercise price of the warrants.

      The selling stockholders also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act of
1933, provided that they meet the criteria and conform to the requirements of
that rule.

      The selling stockholders and any underwriters, broker-dealers or agents
that participate in the sale of the common stock or interests therein may be
"underwriters" within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities Act.
Selling stockholders who are "underwriters" within the meaning of Section 2(11)
of the Securities Act will be subject to the prospectus delivery requirements of
the Securities Act.

      To the extent required, the shares of our common stock to be sold, the
names of the selling stockholders, the respective purchase prices and public
offering prices, the names of any agents, dealer or underwriter, any applicable
commissions or discounts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.

      In order to comply with the securities laws of some states, if applicable,
the common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states the common stock may
not be sold unless it has been registered or

                                       -2-
<PAGE>

qualified for sale or an exemption from registration or qualification
requirements is available and is complied with.

      We have advised the selling stockholders that the anti-manipulation rules
of Regulation M under the Exchange Act may apply to sales of shares in the
market and to the activities of the selling stockholders and their affiliates.
In addition, we will make copies of this prospectus (as it may be supplemented
or amended from time to time) available to the selling stockholders for the
purpose of satisfying the prospectus delivery requirements of the Securities
Act. The selling stockholders may indemnify any broker-dealer that participates
in transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act.

      We have agreed to indemnify the selling stockholders against liabilities,
including liabilities under the Securities Act and state securities laws,
relating to the registration of the shares offered by this prospectus.

      We have agreed with the selling stockholders to keep the registration
statement of which this prospectus constitutes a part effective until the
earlier of (1) 24 months after the registration statement is declared effective
by the Securities and Exchange Commission, (2) the date when all of the shares
covered by this prospectus have been disposed of pursuant to and in accordance
with the registration statement or (3) the date on which all of the shares
covered by this prospectus may be sold pursuant to Rule 144(k) of the Securities
Act.

                                       -3-
<PAGE>

                                    EXHIBIT B

                         WARP TECHNOLOGY HOLDINGS, INC.

                  SELLING INVESTOR'S QUESTIONNAIRE AND COVENANT

            [TO BE COMPLETED AND EXECUTED PRIOR TO THE FILING OF THE
                            REGISTRATION STATEMENT.]

      In connection with the WARP Technology Holdings, Inc. (the "Company")
Registration on Form SB-2 (the "Registration Statement")to be filed on or about
______________, 2005 with the Securities and Exchange Commission (the "SEC")
registering certain shares (the "Shares") of the Company's Common Stock that are
issuable on (i) conversion of the outstanding shares of Series C Preferred Stock
and (ii) exercise of certain Warrants to purchase shares of Common Stock, the
undersigned represents, warrants and covenants as follows:

      1. As of the date hereof, the undersigned beneficially owns the number of
shares of the Company's Common Stock set forth opposite his, her or its name on
Exhibit A attached hereto.

      2. The persons listed on Exhibit A represent all of the individuals who
exercise voting or dispositive power over the Shares to be included pursuant to
the Registration Statement.

      3. The undersigned hereby represents that it understands that, pursuant to
Interpretation A.65 in the SEC Division of Corporation Finance, Manual of
Publicly Available Telephone Interpretations dated July 1997, a copy of which is
attached as Exhibit B hereto, the undersigned may not make any short sale of the
Shares prior to the effectiveness of the Registration Statement.

      4. The undersigned has not had a material relationship with the Company or
any of its predecessors or affiliates within the last three years.

      The term "material relationship" has not been defined by the SEC. However,
the SEC has indicated that it will probably construe as a "material
relationship" any relationship which tends to prevent arms length bargaining in
dealings with a company, whether arising from a close business connection or
family relationship, a relationship of control or otherwise. It seems prudent,
therefore, to consider that the undersigned would have such a relationship, for
example, with any organization of which the undersigned is an officer, director,
trustee or partner or in which the undersigned owns, directly or indirectly, 10%
or more of the outstanding voting stock, or in which the undersigned has some
other substantial interest, and with any person or organization with whom the
undersigned has, or with whom any relative or spouse (or any other person or
organization as to which the undersigned has any of the foregoing other
relationships) has, a contractual relationship.

<PAGE>

      Exceptions:

________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________

      5. The undersigned hereby covenants to the Company that, during the period
in which the Registration Statement is effective, the undersigned will:

            (a) not engage in any stabilization activity in connection with any
of the Company's securities;

            (b) cause to be furnished to any purchaser of the Shares and to the
broker-dealer, if any, through which the Shares may be offered, a copy of the
final prospectus contained in the Registration Statement;

            (c) not bid for or purchase any securities of the Company or any
rights to acquire the Company's securities, or attempt to induce any person to
purchase any of the Company's securities or any rights to acquire the Company's
securities other than as permitted under the Securities Exchange Act of 1934;

            (d) not effect any sale or distribution of the Shares until after
the prospectus has been appropriately amended or supplemented, if required; and

            (e) effect all sales, distributions or gifts of shares in accordance
with the plan of distribution described in the section of the Registration
Statement entitled "Plan of Distribution," a draft of which has been provided as
Annex A to the Investors' Agreement.

      6. The undersigned acknowledges that the information set forth in this
questionnaire will be used by the Company in connection with the registration of
the Shares, and is true, accurate and complete.

            IN WITNESS WHEREOF, the undersigned declares that the above
information is true, accurate and complete.

                                               NAME OF INVESTOR:

                                               _________________________________
                                                        (PRINT OR TYPE)

Dated: ____________________                    By:______________________________
                                                          (signature)

                                               Name:____________________________

                                               Title:___________________________
                                                          (if applicable)

                                      -2-
<PAGE>

                                    EXHIBIT A

1.    Shares of WARP Technology Holdings, Inc. stock beneficially owned as of
      the date hereof (please complete):

Shares of Series C Preferred Stock:_________________________________.

Shares of Common Stock issuable on conversion of the Series C Preferred Stock:
_______________________________.

Shares of Common Stock issuable on exercise of all Warrants:__________________ .

Other WARP Technology shares held:____________________________________________ .

Other warrants or options to purchase shares of WARP Technology stock that are
exercisable within 60 days after the estimated filing date: ___________________.

2.    If the shares are held by an entity, you must list the natural person who
      holds sole voting and dispositive power over the shares held (or if more
      than one natural person shares voting and dispositive power, you must list
      all of the natural persons who share voting and dispositive power over the
      shares). So, for example, a disclosure may read as follows:

      "The shares held on behalf of [selling Investor] are managed by its
      managing member, XYZ Corp., LLC. The [officers][managing directors] of XYZ
      Corp., LLC, who share voting and dispositive power over the shares, are
      John Brown and Harry Smith."

      Name of natural person(s) with voting and dispositive power over the
      shares:

      ________________________________

      ________________________________

      ________________________________

      The undersigned agrees with the information set forth on this Exhibit A
and acknowledges that such information will be used in connection with the
registration of the shares.

<PAGE>

                                               Name of Selling Investor:

                                               Print Name: _____________________

                                               By (signature): _________________

                                               Title: __________________________

                                               Date: ___________________________

                                      -2-
<PAGE>

                                    EXHIBIT B

Interpretation A.65 from the Securities and Exchange Commission, Division of
Corporation Finance, Manual of Publicly Available Telephone Interpretations
dated July 1997:

            "An issuer filed a Form S-3 registration statement for a secondary
            offering of common stock which is not yet effective. One of the
            selling shareholders wanted to do a short sale of common stock
            "against the box" and cover the short sale with registered shares
            after the effective date. The issuer was advised that the short sale
            could not be made before the registration statement becomes
            effective, because the shares underlying the short sale are deemed
            to be sold at the time such sale is made. There would, therefore, be
            a violation of Section 5 if the shares were effectively sold prior
            to the effective date."

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