Document:

Exhibit 10.1

                               SEQUIAM CORPORATION

                          SECURITIES PURCHASE AGREEMENT

                                 APRIL 27, 2004

<PAGE>
                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

1.   Agreement to Sell and Purchase . . . . . . . . . . . . . . . . . . . . . .1
     ------------------------------

2.   Fees and Warrant . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
     ----------------

3.   Closing, Delivery and Payment. . . . . . . . . . . . . . . . . . . . . . .2
     -----------------------------
     3.1     Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
             -------
     3.2     Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
             --------

4.   Representations and Warranties of the Company. . . . . . . . . . . . . . .3
     ---------------------------------------------
     4.1     Organization, Good Standing and Qualification. . . . . . . . . . .3
             ---------------------------------------------
     4.2     Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . .3
             ------------
     4.3     Capitalization; Voting Rights. . . . . . . . . . . . . . . . . . .4
             -----------------------------
     4.4     Authorization; Binding Obligations . . . . . . . . . . . . . . . .4
             ----------------------------------
     4.5     Liabilities  . . . . . . . . . . . . . . . . . . . . . . . . . . .5
             -----------
     4.6     Agreements; Action . . . . . . . . . . . . . . . . . . . . . . . .5
             ------------------
     4.7     Obligations to Related Parties . . . . . . . . . . . . . . . . . .6
             ------------------------------
     4.8     Changes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
             -------
     4.9     Title to Properties and Assets; Liens, Etc.. . . . . . . . . . . .8
             ------------------------------------------
     4.10    Intellectual Property. . . . . . . . . . . . . . . . . . . . . . .8
             ---------------------
     4.11    Compliance with Other Instruments. . . . . . . . . . . . . . . . .9
             ---------------------------------
     4.12    Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
             ----------
     4.13    Tax Returns and Payments . . . . . . . . . . . . . . . . . . . . .9
             ------------------------
     4.14    Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
             ---------
     4.15    Registration Rights and Voting Rights. . . . . . . . . . . . . . 10
             -------------------------------------
     4.16    Compliance with Laws; Permits. . . . . . . . . . . . . . . . . . 10
             -----------------------------
     4.17    Environmental and Safety Laws. . . . . . . . . . . . . . . . . . 11
             -----------------------------
     4.18    Valid Offering . . . . . . . . . . . . . . . . . . . . . . . . . 11
             --------------
     4.19    Full Disclosure. . . . . . . . . . . . . . . . . . . . . . . . . 11
             ---------------
     4.20    Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
             ---------
     4.21    SEC Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
             -----------
     4.22    Listing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
             -------
     4.23    No Integrated Offering . . . . . . . . . . . . . . . . . . . . . 12
             ----------------------
     4.24    Stop Transfer. . . . . . . . . . . . . . . . . . . . . . . . . . 12
             -------------
     4.25    Dilution . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
             --------
     4.26    Patriot Act. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
             -----------

5.   Representations and Warranties of the Purchaser. . . . . . . . . . . . . 13
     -----------------------------------------------
     5.1     No Shorting. . . . . . . . . . . . . . . . . . . . . . . . . . . 13
             -----------
     5.2     Requisite Power and Authority. . . . . . . . . . . . . . . . . . 13
             -----------------------------
     5.3     Investment Representations . . . . . . . . . . . . . . . . . . . 14
             --------------------------
     5.4     Purchaser Bears Economic Risk. . . . . . . . . . . . . . . . . . 14
             -----------------------------
     5.5     Acquisition for Own Account. . . . . . . . . . . . . . . . . . . 14
             ---------------------------
     5.6     Purchaser Can Protect Its Interest . . . . . . . . . . . . . . . 14
             ----------------------------------
     5.7     Accredited Investor. . . . . . . . . . . . . . . . . . . . . . . 14
             -------------------
     5.8     Legends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
             -------

6.   Covenants of the Company . . . . . . . . . . . . . . . . . . . . . . . . 15
     ------------------------

                                        i
<PAGE>
     6.1     Stop-Orders. . . . . . . . . . . . . . . . . . . . . . . . . . . 15
             -----------
     6.2     Listing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
             -------
     6.3     Market Regulations . . . . . . . . . . . . . . . . . . . . . . . 16
             ------------------
     6.4     Reporting Requirements . . . . . . . . . . . . . . . . . . . . . 16
             ----------------------
     6.5     Use of Funds. . . . . . . . . . . . . . . . . . . . . . . . . . .16
             ------------
     6.6     Access to Facilities. . . . . . . . . . . . . . . . . . . . . . .16
             --------------------
     6.7     Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
             -----
     6.8     Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
             ---------
     6.9     Intellectual Property. . . . . . . . . . . . . . . . . . . . . . 18
             ---------------------
     6.10    Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
             ----------
     6.11    Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . 18
             ---------------
     6.12    Required Approvals . . . . . . . . . . . . . . . . . . . . . . . 18
             ------------------
     6.13    Reissuance of Securities . . . . . . . . . . . . . . . . . . . . 19
             ------------------------
     6.14    Opinion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
             -------
     6.15    Additional Investment. . . . . . . . . . . . . . . . . . . . . . 20
             ---------------------

7.   Covenants of the Purchaser . . . . . . . . . . . . . . . . . . . . . . . 20
     --------------------------
     7.1     Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . 20
             ---------------
     7.2     Non-Public Information . . . . . . . . . . . . . . . . . . . . . 20
             ----------------------

8.   Covenants of the Company and Purchaser Regarding Indemnification . . . . 20
     ----------------------------------------------------------------
     8.1     Company Indemnification. . . . . . . . . . . . . . . . . . . . . 20
             -----------------------
     8.2     Purchaser's Indemnification. . . . . . . . . . . . . . . . . . . 21
             ---------------------------
     8.3     Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
             ----------

9.   Conversion of Convertible Note . . . . . . . . . . . . . . . . . . . . . 21
     ------------------------------
     9.1     Mechanics of Conversion. . . . . . . . . . . . . . . . . . . . . 21
             -----------------------

10.  Registration Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . 22
     -------------------
     10.1     Registration Rights Granted . . . . . . . . . . . . . . . . . . 22
              ---------------------------
     10.2     Offering Restrictions . . . . . . . . . . . . . . . . . . . . . 22
              ---------------------

11.  Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
     -------------
     11.1     Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . 23
              -------------
     11.2     Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
              --------
     11.3     Successors. . . . . . . . . . . . . . . . . . . . . . . . . . . 23
              ----------
     11.4     Entire Agreement. . . . . . . . . . . . . . . . . . . . . . . . 23
              ----------------
     11.5     Severability. . . . . . . . . . . . . . . . . . . . . . . . . . 24
              ------------
     11.6     Amendment and Waiver. . . . . . . . . . . . . . . . . . . . . . 24
              --------------------
     11.7     Delays or Omissions . . . . . . . . . . . . . . . . . . . . . . 24
              -------------------
     11.8     Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
              -------
     11.9     Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . 25
              ---------------
     11.10    Titles and Subtitles. . . . . . . . . . . . . . . . . . . . . . 25
              --------------------
     11.11    Facsimile Signatures; Counterparts. . . . . . . . . . . . . . . 25
              ----------------------------------
     11.12    Broker's Fees . . . . . . . . . . . . . . . . . . . . . . . . . 25
              -------------
     11.13    Construction. . . . . . . . . . . . . . . . . . . . . . . . . . 26
              ------------

                                       ii
<PAGE>
                            LIST OF EXHIBITS
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Form of Convertible Term Note . . . . . . . . . . . . . .  Exhibit A
Form of Warrant . . . . . . . . . . . . . . . . . . . . .  Exhibit B
Form of Opinion . . . . . . . . . . . . . . . . . . . . .  Exhibit C
Form of Escrow Agreement. . . . . . . . . . . . . . . . .  Exhibit D

                                      iii
<PAGE>
                          SECURITIES PURCHASE AGREEMENT

     THIS  SECURITIES  PURCHASE AGREEMENT (this "Agreement") is made and entered
into  as  of  April  27,  2004, by and between Sequiam Corporation, a California
corporation  (the  "Company"),  and  Laurus  Master Fund, Ltd., a Cayman Islands
company  (the  "Purchaser").

                                    RECITALS

     WHEREAS,  the  Company  has  authorized  the  sale  to  the  Purchaser of a
Convertible  Term  Note  in the initial aggregate principal amount of $2,000,000
(the  "Note"),  which  Note  is  convertible into shares of the Company's common
stock,  $0.01  par  value  per  share  (the  "Common Stock") at an initial fixed
conversion  price  of  $ [    ] per share of Common Stock (the "Fixed Conversion
Price");

     WHEREAS, the Company wishes to issue a warrant to the Purchaser to purchase
up to 666,666 shares of the Company's Common Stock (subject to adjustment as set
forth  therein)  in  connection  with  Purchaser's  purchase  of  the  Note;

     WHEREAS, Purchaser desires to purchase the Note and the Warrant (as defined
in  Section  2)  on  the  terms  and  conditions  set  forth  herein;  and

     WHEREAS,  the  Company  desires  to  issue and sell the Note and Warrant to
Purchaser  on  the  terms  and  conditions  set  forth  herein.

                                    AGREEMENT

     NOW,  THEREFORE,  in consideration of the foregoing recitals and the mutual
promises,  representations,  warranties  and covenants hereinafter set forth and
for  other good and valuable consideration, the receipt and sufficiency of which
are  hereby  acknowledged,  the  parties  hereto  agree  as  follows:

     1.     Agreement  to  Sell  and  Purchase.  Pursuant  to  the  terms  and
            ----------------------------------
conditions  set  forth  in  this  Agreement,  on the Closing Date (as defined in
Section  3),  the  Company  agrees  to  sell to the Purchaser, and the Purchaser
hereby  agrees  to  purchase  from  the Company, a Note in the initial aggregate
principal  amount of $2,000,000 convertible in accordance with the terms thereof
into  shares  of  the Company's Common Stock in accordance with the terms of the
Note  and  this Agreement. The Note purchased on the Closing Date shall be known
as  the  "Offering." A form of the Note is annexed hereto as Exhibit A. The Note
will  mature  on  the  Maturity Date (as defined in the Note). Collectively, the
Note  and  Warrant  and  Common  Stock  issuable  in  payment  of the Note, upon
conversion  of  the Note and upon exercise of the Warrant are referred to as the
"Securities."

     2.   Fees and Warrant.  On the Closing Date:
          ----------------

          (a)     The  Company will issue and deliver to the Purchaser a Warrant
     to  purchase  up  to  666,666 shares of Common Stock in connection with the
     Offering  (the "Warrant") pursuant to Section 1 hereof. The Warrant must be
     delivered  on  the  Closing  Date.  A  form of Warrant is annexed hereto as
     Exhibit  B.  All  the representations,

                                        1
<PAGE>
     covenants,  warranties, undertakings, and indemnification, and other rights
     made  or  granted to or for the benefit of the Purchaser by the Company are
     hereby  also  made  and granted in respect of the Warrant and shares of the
     Company's  Common Stock issuable upon exercise of the Warrant (the "Warrant
     Shares").

          (b)     Subject  to the terms of Section 2(d) below, the Company shall
     pay  to  Laurus  Capital  Management,  LLC, the manager of the Purchaser, a
     closing  payment  in  an  amount  equal  to  $105,000. The foregoing fee is
     referred to herein as the "Closing Payment." For the avoidance of doubt, it
     is  understood  and  agreed  that the entire portion of the Closing Payment
     shall  be  earned  by,  and  payable  to, the Purchaser on the Closing Date
     (including, without limitation, that portion allocable to the funding under
     the Incremental Funding Side Letter (as defined below), which portion shall
     be  earned  by,  and  payable  to,  the  Purchaser  on  the Closing Date as
     consideration  for  the  provision  by  the Purchaser of the commitment set
     forth  in  the  Incremental  Funding  Side  Letter).

          (c)     The  Company  shall reimburse the Purchaser for its reasonable
     legal  fees  for  services rendered to the Purchaser in preparation of this
     Agreement and the Related Agreements (as hereinafter defined), and expenses
     incurred  in  connection  with  the Purchaser's due diligence review of the
     Company  and  its  Subsidiaries (as defined in Section 6.8) and all related
     matters.  Amounts  required to be paid under this Section 2(c) will be paid
     on  the  Closing  Date and shall be $39,500 for legal fees and for expenses
     incurred  while  performing  due diligence inquiries on the Company and its
     Subsidiaries.

          (d)     The  Closing  Payment,  the  legal  fees and the due diligence
     expenses  (net of deposits previously paid by the Company) shall be paid at
     closing out of funds held pursuant to a Funds Escrow Agreement of even date
     herewith  among  the  Company,  Purchaser,  and an Escrow Agent (the "Funds
     Escrow  Agreement")  and a disbursement letter (the "Disbursement Letter").

     3.   Closing, Delivery and Payment.
          -----------------------------

          3.1     Closing.  Subject  to  the  terms  and  conditions herein, the
                  -------
closing  of  the  transactions  contemplated  hereby (the "Closing"), shall take
place on the date hereof, at such time or place as the Company and Purchaser may
mutually  agree  (such  date  is hereinafter referred to as the "Closing Date").

          3.2     Delivery.  Pursuant  to the Funds Escrow Agreement in the form
                  --------
attached  hereto  as  Exhibit C, at the Closing on the Closing Date, the Company
will  deliver  to the Purchaser, among other things, a Note in the form attached
as  Exhibit  A  representing  the aggregate principal amount of $2,000,000 and a
Warrant  in  the form attached as Exhibit B in the Purchaser's name representing
666,666  Warrant  Shares  and  the  Purchaser will deliver to the Company, among
other  things,  the  amounts  set forth in the Disbursement Letter  by certified
funds  or  wire  transfer.

                                        2
<PAGE>
     4.     Representations  and  Warranties of the Company.  The Company hereby
            -----------------------------------------------
represents  and  warrants to the Purchaser as follows (which representations and
warranties  are  supplemented  by  the  Company's  filings  under the Securities
Exchange Act of 1934 (collectively, the "Exchange Act Filings"), copies of which
have  been  provided  to  the  Purchaser):

          4.1     Organization,  Good  Standing  and Qualification.  Each of the
                  ------------------------------------------------
Company  and  each  of its Subsidiaries is a corporation, partnership or limited
liability  company,  as the case may be, duly organized, validly existing and in
good  standing  under  the laws of its jurisdiction of organization. Each of the
Company  and  each  of its Subsidiaries has the corporate power and authority to
own  and  operate  its  properties  and  assets, to execute and deliver (i) this
Agreement,  (ii)  the  Note and the Warrant to be issued in connection with this
Agreement,  (iii)  the  Master  Security  Agreement  dated as of the date hereof
between  the  Company, certain Subsidiaries of the Company and the Purchaser (as
amended,  modified  or  supplemented  from  time  to  time, the "Master Security
Agreement"),  (iv)  the Registration Rights Agreement relating to the Securities
dated  as  of the date hereof between the Company and the Purchaser (as amended,
modified  or  supplemented  from  time  to  time,  the  "Registration  Rights
Agreement"),  (v)  the  Subsidiary  Guaranty dated as of the date hereof made by
certain  Subsidiaries  of the Company (as amended, modified or supplemented from
time  to time, the "Subsidiary Guaranty"), (vi) the Stock Pledge Agreement dated
as of the date hereof among the Company, certain Subsidiaries of the Company and
the  Purchaser  (as  amended,  modified  or  supplemented from time to time, the
"Stock  Pledge  Agreement"),  (vii)  the  Escrow  Agreement dated as of the date
hereof among the Company, the Purchaser and the escrow agent referred to therein
(viii)  that  certain  Incremental  Funding  Side Letter, dated the date hereof,
between the Company and the Purchaser (as amended, modified or supplemented from
time  to  time,  the  "Incremental Funding Side Letter"), (ix) the Subordination
Agreement  dated as of the date hereof among Mark Mroczkowski, Nick VandenBrekel
and  the  Purchaser (as amended, modified or supplemented from time to time, the
"Subordination  Agreement")  and  (x)  all  other  agreements  related  to  this
Agreement  and  the  Note  and  referred  to  herein (the preceding clauses (ii)
through (x), collectively, the "Related Agreements"), to issue and sell the Note
and  the  shares of Common Stock issuable upon conversion of the Note (the "Note
Shares"), to issue and sell the Warrant and the Warrant Shares, and to carry out
the  provisions of this Agreement and the Related Agreements and to carry on its
business  as  presently  conducted.  Each  of  the  Company  and  each  of  its
Subsidiaries  is  duly qualified and is authorized to do business and is in good
standing  as a foreign corporation, partnership or limited liability company, as
the  case may be, in all jurisdictions in which the nature of its activities and
of  its  properties  (both owned and leased) makes such qualification necessary,
except  for  those jurisdictions in which failure to do so has not, or could not
reasonably  be  expected  to  have, individually or in the aggregate, a material
adverse  effect  on  the  business, assets, liabilities, condition (financial or
otherwise),  properties,  operations  or  prospects  of  the  Company  and  it
Subsidiaries,  taken  individually and as a whole (a "Material Adverse Effect").

          4.2     Subsidiaries.  Each  direct  and  indirect  Subsidiary  of the
                  ------------
Company,  the  direct  owner  of  such  Subsidiary  and its percentage ownership
thereof,  is  set  forth  on Schedule 4.2.  For the purpose of this Agreement, a
"Subsidiary"  of  any  person  or entity means (i) a corporation or other entity
 ----------
whose  shares of stock or other ownership interests having ordinary voting power
(other  than stock or other ownership interests having such power only by reason
of  the happening of a contingency) to elect a majority of the directors of such
corporation,  or other persons or entities performing similar functions for such
person or entity, are owned, directly or

                                        3
<PAGE>
indirectly,  by  such  person or entity or (ii) a corporation or other entity in
which  such  person or entity owns, directly or indirectly, more than 50% of the
equity  interests  at  such  time.

     4.3     Capitalization;  Voting  Rights.
             -------------------------------

          (a)     The  authorized  capital  stock of the Company, as of the date
     hereof  consists  of 150,000,000 shares, of which 100,000,000 are shares of
     Common  Stock,  par  value $0.001 per share, 45,349,729 shares of which are
     issued  and  outstanding;  and  of which 50,000,000 are shares of Preferred
     Stock,  par  value  $0.001  per  share,  -0- shares of which are issued and
     outstanding. The authorized capital stock of each Subsidiary of the Company
     is  set  forth  on  Schedule  4.3.

          (b)     Except  as  disclosed  on  Schedule  4.3, other than:  (i) the
     shares  reserved  for  issuance under the Company's stock option plans; and
     (ii) shares which may be granted pursuant to this Agreement and the Related
     Agreements,  there  are no outstanding options, warrants, rights (including
     conversion  or  preemptive  rights  and  rights of first refusal), proxy or
     stockholder  agreements,  or arrangements or agreements of any kind for the
     purchase  or  acquisition from the Company of any of its securities. Except
     as disclosed on Schedule 4.3, neither the offer, issuance or sale of any of
     the  Note  or  the  Warrant,  or  the issuance of any of the Note Shares or
     Warrant Shares, nor the consummation of any transaction contemplated hereby
     will  result  in  a  change in the price or number of any securities of the
     Company  outstanding,  under  anti-dilution  or  other  similar  provisions
     contained  in  or  affecting  any  such  securities.

          (c)     All  issued  and  outstanding  shares  of the Company's Common
     Stock:  (i) have been duly authorized and validly issued and are fully paid
     and  nonassessable;  and (ii) were issued in compliance with all applicable
     state  and  federal  laws  concerning  the  issuance  of  securities.

          (d)     The  rights,  preferences,  privileges and restrictions of the
     shares  of  the  Common Stock are as stated in the Company's Certificate of
     Incorporation (the "Charter"). The Note Shares and Warrant Shares have been
     duly  and validly reserved for issuance. When issued in compliance with the
     provisions of this Agreement and the Company's Charter, the Securities will
     be  validly  issued,  fully paid and nonassessable, and will be free of any
     liens  or  encumbrances;  provided,  however,  that  the  Securities may be
     subject  to  restrictions on transfer under state and/or federal securities
     laws  as set forth herein or as otherwise required by such laws at the time
     a  transfer  is  proposed.

     4.4     Authorization;  Binding Obligations.  All corporate, partnership or
             -----------------------------------
limited liability company, as the case may be, action on the part of the Company
and  each  of its Subsidiaries (including the respective officers and directors)
necessary  for  the  authorization of this Agreement and the Related Agreements,
the performance of all obligations of the Company and its Subsidiaries hereunder
and  under  the  other Related Agreements at the Closing and, the authorization,
sale,  issuance  and  delivery of the Note and Warrant has been taken or will be
taken  prior  to  the Closing.  This Agreement and the other Related Agreements,
when  executed

                                        4
<PAGE>
and delivered and to the extent it is a party thereto, will be valid and binding
obligations  of  each  of  the Company and each of its Subsidiaries, enforceable
against  each  such  person  in  accordance  with  their  terms,  except:

          (a)     as  limited  by  applicable  bankruptcy,  insolvency,
     reorganization,  moratorium  or other laws of general application affecting
     enforcement  of  creditors'  rights;  and

          (b)     general principles of equity that restrict the availability of
     equitable  or  legal  remedies.

The  sale of the Note and the subsequent conversion of the Note into Note Shares
are  not  and  will  not  be subject to any preemptive rights or rights of first
refusal that have not been properly waived or complied with. The issuance of the
Warrant  and  the  subsequent exercise of the Warrant for Warrant Shares are not
and will not be subject to any preemptive rights or rights of first refusal that
have  not  been  properly  waived  or  complied  with.

     4.5     Liabilities.  Neither  the  Company nor any of its Subsidiaries has
             -----------
any  contingent liabilities, except current liabilities incurred in the ordinary
course  of  business  and  liabilities  disclosed  in  any Exchange Act Filings.

     4.6     Agreements;  Action.  Except  as  set  forth  on Schedule 4.6 or as
             -------------------
disclosed  in  any  Exchange  Act  Filings:

          (a)     there  are  no  agreements,  understandings,  instruments,
     contracts,  proposed  transactions,  judgments, orders, writs or decrees to
     which  the  Company or any of its Subsidiaries is a party or by which it is
     bound  which  may involve: (i) obligations (contingent or otherwise) of, or
     payments  to,  the Company in excess of $50,000 (other than obligations of,
     or  payments  to,  the  Company arising from agreements entered into in the
     ordinary  course  of  business);  or  (ii)  the  transfer or license of any
     patent,  copyright,  trade secret or other proprietary right to or from the
     Company  (other  than licenses arising from the purchase of "off the shelf"
     or  other  standard  products);  or  (iii)  provisions  restricting  the
     development,  manufacture  or  distribution  of  the  Company's products or
     services;  or  (iv)  indemnification  by  the  Company  with  respect  to
     infringements  of  proprietary  rights.

          (b)     Since  December 31, 2003, except for Intercompany Transactions
     (as  defined  below),  neither the Company nor any of its Subsidiaries has:
     (i)  declared or paid any dividends, or authorized or made any distribution
     upon  or  with  respect  to  any class or series of its capital stock; (ii)
     incurred  any  indebtedness  for  money  borrowed  or any other liabilities
     (other  than ordinary course obligations) individually in excess of $50,000
     or,  in  the case of indebtedness and/or liabilities individually less than
     $50,000,  in  excess  of $100,000 in the aggregate; (iii) made any loans or
     advances  to any person not in excess, individually or in the aggregate, of
     $100,000,  other than ordinary course advances for travel expenses; or (iv)
     sold, exchanged or otherwise disposed of any of its assets or rights, other
     than  the sale of its inventory in the ordinary course of business. For the
     purposes  of  this  Agreement,  "Intercompany  Transactions"  shall  mean,
     collectively,  (i)

                                        5
<PAGE>
     any  dividends  paid  by  any  Subsidiary  which is party to the Subsidiary
     Guaranty, the Master Security Agreement and the Stock Pledge Agreement (any
     such  Subsidiary,  a  "Subsidiary  Guarantor")  to  any  other  Subsidiary
     Guarantor  or  the  Company,  (ii)  any  loans  made  by the Company or any
     Subsidiary  Guarantor to the Company or any Subsidiary Guarantor, (iii) any
     investments  made by the Company or any Subsidiary Guarantor in the Company
     or  any Subsidiary Guarantor and (iv) any transfer of assets by the Company
     or  any  Subsidiary  Guarantor  to the Company or any Subsidiary Guarantor.

          (c)     For  the  purposes  of  subsections  (a)  and  (b)  above, all
     indebtedness,  liabilities,  agreements,  understandings,  instruments,
     contracts  and  proposed  transactions  involving the same person or entity
     (including  persons  or  entities  the  Company  has  reason to believe are
     affiliated  therewith)  shall  be aggregated for the purpose of meeting the
     individual  minimum  dollar  amounts  of  such  subsections.

     4.7     Obligations  to  Related  Parties.  Except as set forth on Schedule
             ---------------------------------
4.7,  there  are  no  obligations  of  the Company or any of its Subsidiaries to
officers,  directors,  stockholders  or  employees  of the Company or any of its
Subsidiaries  other  than:

          (a)     for  payment  of  salary  for  services rendered and for bonus
     payments;

          (b)     reimbursement  for  reasonable  expenses incurred on behalf of
     the  Company  and  its  Subsidiaries;

          (c)     for  other standard employee benefits made generally available
     to  all  employees (including stock option agreements outstanding under any
     stock  option  plan approved by the Board of Directors of the Company); and

          (d)     obligations  listed  in  the Company's financial statements or
     disclosed  in  any  of  its  Exchange  Act  Filings.

Except  as  described  above or set forth on Schedule 4.7, none of the officers,
directors  or,  to  the  best  of  the  Company's  knowledge,  key  employees or
stockholders  of  the  Company  or  any members of their immediate families, are
indebted  to the Company, individually or in the aggregate, in excess of $50,000
or  have  any  direct  or indirect ownership interest in any firm or corporation
with  which  the  Company is affiliated or with which the Company has a business
relationship,  or any firm or corporation which competes with the Company, other
than  passive  investments  in publicly traded companies (representing less than
one  percent (1%) of such company) which may compete with the Company. Except as
described  above,  no  officer,  director or stockholder, or any member of their
immediate  families,  is,  directly  or  indirectly,  interested in any material
contract  with  the  Company  and  no  agreements,  understandings  or  proposed
transactions  are  contemplated between the Company and any such person.  Except
as  set  forth  on Schedule 4.7, the Company is not a guarantor or indemnitor of
any  indebtedness  of  any  other  person,  firm  or  corporation.

     4.8     Changes.  Since  December  31,  2003,  except  as  disclosed in any
             -------
Exchange  Act  Filing  or  in  any  Schedule  to this Agreement or to any of the
Related  Agreements,  there  has  not  been:

                                        6
<PAGE>
          (a)     any  change  in  the  business, assets, liabilities, condition
     (financial  or  otherwise),  properties,  operations  or  prospects  of the
     Company  or any of its Subsidiaries, which individually or in the aggregate
     has  had,  or  could reasonably be expected to have, individually or in the
     aggregate,  a  Material  Adverse  Effect;

          (b)     any resignation or termination of any officer, key employee or
     group  of  employees  of  the  Company  or  any  of  its  Subsidiaries;

          (c)     any  material  change,  except  in  the  ordinary  course  of
     business,  in  the  contingent  obligations  of  the  Company or any of its
     Subsidiaries  by  way  of  guaranty,  endorsement,  indemnity,  warranty or
     otherwise;

          (d)     any  damage,  destruction  or  loss, whether or not covered by
     insurance,  has  had, or could reasonably be expected to have, individually
     or  in  the  aggregate,  a  Material  Adverse  Effect;

          (e)     any  waiver  by  the  Company  or any of its Subsidiaries of a
     valuable  right  or  of  a  material  debt  owed  to  it;

          (f)     any direct or indirect loans made by the Company or any of its
     Subsidiaries  to  any  stockholder,  employee,  officer  or director of the
     Company  or  any  of  its  Subsidiaries,  other  than  advances made in the
     ordinary  course  of  business;

          (g)     any  material  change  in  any  compensation  arrangement  or
     agreement  with  any  employee,  officer,  director  or  stockholder of the
     Company  or  any  of  its  Subsidiaries;

          (h)     except for any dividend or other distribution that consists of
     an  Intercompany Transaction, any declaration or payment of any dividend or
     other distribution of the assets of the Company or any of its Subsidiaries;

          (i)     any  labor organization activity related to the Company or any
     of  its  Subsidiaries;

          (j)     any  debt,  obligation  or  liability  incurred,  assumed  or
     guaranteed  by  the  Company  or  any of its Subsidiaries, except those for
     immaterial  amounts  and  for  current liabilities incurred in the ordinary
     course  of  business;

          (k)     any  sale,  assignment or transfer of any patents, trademarks,
     copyrights,  trade  secrets or other intangible assets owned by the Company
     or  any  of  its  Subsidiaries;

          (l)     any  change  in any material agreement to which the Company or
     any of its Subsidiaries is a party or by which either the Company or any of
     its Subsidiaries is bound which either individually or in the aggregate has
     had,  or  could  reasonably  be  expected  to  have, individually or in the
     aggregate,  a  Material  Adverse  Effect;

          (m)     any  other  event  or  condition of any character that, either
     individually  or in the aggregate, has had, or could reasonably be expected
     to  have,  individually  or in the aggregate, a Material Adverse Effect; or

                                        7
<PAGE>
          (n)     any  arrangement  or  commitment  by the Company or any of its
     Subsidiaries  to do any of the acts described in subsection (a) through (m)
     above.

          4.9     Title to Properties and Assets;  Liens,  Etc.  Except  as  set
                  --------------------------------------------
forth on Schedule 4.9, each of the Company and each of its Subsidiaries has good
and  marketable  title  to  its  properties  and  assets,  and good title to its
leasehold  estates,  in  each  case subject to no mortgage, pledge, lien, lease,
encumbrance  or  charge,  other  than:

          (a)     those  resulting  from  taxes  which  have  not  yet  become
     delinquent;

          (b)     minor  liens  and encumbrances which do not materially detract
     from  the  value  of  the property subject thereto or materially impair the
     operations  of  the  Company  or  any  of  its  Subsidiaries;  and

          (c)     those  that  have  otherwise  arisen in the ordinary course of
     business.

All  facilities,  machinery,  equipment, fixtures, vehicles and other properties
owned,  leased or used by the Company and its Subsidiaries are in good operating
condition  and  repair  and  are  reasonably fit and usable for the purposes for
which they are being used.  Except as set forth on Schedule 4.9, the Company and
its  Subsidiaries  are  in  compliance  with all material terms of each lease to
which  it  is  a  party  or  is  otherwise  bound.

     4.10     Intellectual  Property.
              ----------------------

          (a)     Each  of  the  Company  and  each  of its Subsidiaries owns or
     possesses  sufficient  legal  rights  to  all  patents, trademarks, service
     marks,  trade  names,  copyrights, trade secrets, licenses, information and
     other  proprietary  rights  and processes necessary for its business as now
     conducted  and  to  the  Company's  knowledge,  as presently proposed to be
     conducted  (the "Intellectual Property"), without any known infringement of
     the  rights  of  others.  There  are  no  outstanding  options, licenses or
     agreements of any kind relating to the foregoing proprietary rights, nor is
     the  Company or any of its Subsidiaries bound by or a party to any options,
     licenses or agreements of any kind with respect to the patents, trademarks,
     service  marks,  trade  names,  copyrights,  trade  secrets,  licenses,
     information  and other proprietary rights and processes of any other person
     or  entity other than such licenses or agreements arising from the purchase
     of  "off  the  shelf"  or  standard  products.

          (b)     Neither  the  Company nor any of its Subsidiaries has received
     any communications alleging that the Company or any of its Subsidiaries has
     violated  any  of  the  patents,  trademarks,  service  marks, trade names,
     copyrights or trade secrets or other proprietary rights of any other person
     or entity, nor is the Company or any of its Subsidiaries aware of any basis
     therefor.

          (c)     The  Company  does  not  believe it is or will be necessary to
     utilize  any inventions, trade secrets or proprietary information of any of
     its  employees  made prior to their employment by the Company or any of its
     Subsidiaries,  except  for  inventions,  trade  secrets  or  proprietary
     information that have been rightfully assigned to the Company or any of its
     Subsidiaries.

                                        8
<PAGE>
          4.11     Compliance with Other Instruments.  Neither  the  Company nor
                   ---------------------------------
any  of  its  Subsidiaries  is  in  violation  or default of (x) any term of its
Charter  or  Bylaws,  or  (y)  of  any  provision of any indebtedness, mortgage,
indenture, contract, agreement or instrument to which it is party or by which it
is  bound or of any judgment, decree, order or writ, which violation or default,
in  the  case  of  this  clause (y), has had, or could reasonably be expected to
have,  either  individually  or in the aggregate, a Material Adverse Effect. The
execution,  delivery  and  performance of and compliance with this Agreement and
the  Related Agreements to which it is a party, and the issuance and sale of the
Note by the Company and the other Securities by the Company each pursuant hereto
and  thereto, will not, with or without the passage of time or giving of notice,
result  in  any  such material violation, or be in conflict with or constitute a
default  under  any  such  term  or  provision, or result in the creation of any
mortgage,  pledge,  lien,  encumbrance  or  charge upon any of the properties or
assets  of the Company or any of its Subsidiaries or the suspension, revocation,
impairment,  forfeiture  or  nonrenewal of any permit, license, authorization or
approval  applicable  to  the  Company, its business or operations or any of its
assets  or  properties.

          4.12     Litigation.  Except  as  set  forth  on Schedule 4.12 hereto,
                   ----------
there  is  no  action,  suit,  proceeding  or  investigation  pending or, to the
Company's  knowledge,  currently  threatened  against  the Company or any of its
Subsidiaries  that prevents the Company or any of its Subsidiaries from entering
into  this  Agreement  or  the  Related  Agreements,  or  from  consummating the
transactions  contemplated  hereby  or  thereby,  or  which  has  had,  or could
reasonably  be  expected  to  have,  either  individually or in the aggregate, a
Material  Adverse  Effect  or  any change in the current equity ownership of the
Company  or  any of its Subsidiaries, nor is the Company aware that there is any
basis  to  assert  any  of  the  foregoing.  Neither  the Company nor any of its
Subsidiaries  is  a  party  or  subject  to  the  provisions of any order, writ,
injunction,  judgment  or  decree  of  any  court  or  government  agency  or
instrumentality.  There  is  no action, suit, proceeding or investigation by the
Company or any of its Subsidiaries currently pending or which the Company or any
of  its  Subsidiaries  intends  to  initiate.

          4.13     Tax Returns and Payments. Each of the Company and each of its
                   ------------------------
Subsidiaries  has  timely  filed  all  tax  returns  (federal,  state and local)
required  to  be  filed  by  it.  All  taxes shown to be due and payable on such
returns,  any  assessments  imposed,  and all other taxes due and payable by the
Company  or  any of its Subsidiaries on or before the Closing, have been paid or
will  be  paid prior to the time they become delinquent.  Except as set forth on
Schedule 4.13, neither the Company nor any of its Subsidiaries has been advised:

          (a)     that any of its returns, federal, state or other, have been or
     are  being  audited  as  of  the  date  hereof;  or

          (b)     of  any  deficiency  in assessment or proposed judgment to its
     federal,  state  or  other  taxes.

The  Company has no knowledge of any liability of any tax to be imposed upon its
properties  or  assets  as  of the date of this Agreement that is not adequately
provided  for.

          4.14     Employees.  Except as set forth on Schedule 4.14, neither the
                   ---------
Company  nor  any  of  its Subsidiaries has any collective bargaining agreements
with  any of its employees.

                                        9
<PAGE>
There  is  no  labor  union  organizing  activity  pending  or, to the Company's
knowledge,  threatened  with  respect to the Company or any of its Subsidiaries.
Except as disclosed in the Exchange Act Filings or on Schedule 4.14, neither the
Company  nor  any  of  its  Subsidiaries is a party to or bound by any currently
effective  employment  contract,  deferred compensation arrangement, bonus plan,
incentive  plan,  profit  sharing  plan,  retirement agreement or other employee
compensation  plan  or agreement. To the Company's knowledge, no employee of the
Company  or any of its Subsidiaries, nor any consultant with whom the Company or
any  of  its  Subsidiaries  has  contracted,  is in violation of any term of any
employment  contract,  proprietary  information agreement or any other agreement
relating  to  the right of any such individual to be employed by, or to contract
with,  the  Company  or  any  of  its  Subsidiaries because of the nature of the
business  to  be conducted by the Company or any of its Subsidiaries; and to the
Company's  knowledge  the  continued  employment  by  the  Company or any of its
Subsidiaries  of its present employees, and the performance of the Company's and
its Subsidiaries' contracts with its independent contractors, will not result in
any  such  violation.  Neither  the Company nor any of its Subsidiaries is aware
that  any  of its employees is obligated under any contract (including licenses,
covenants  or  commitments  of any nature) or other agreement, or subject to any
judgment,  decree  or  order  of  any court or administrative agency, that would
interfere  with  their duties to the Company or any of its Subsidiaries. Neither
the  Company  nor  any of its Subsidiaries has received any notice alleging that
any  such  violation  has  occurred.  Except  for  employees  who have a current
effective  employment  agreement with the Company or any of its Subsidiaries, no
employee of the Company or any of its Subsidiaries has been granted the right to
continued  employment  by  the  Company  or  any  of  its Subsidiaries or to any
material  compensation  following  termination of employment with the Company or
any  of  its  Subsidiaries. Except as set forth on Schedule 4.14, the Company is
not  aware  that  any  officer,  key  employee  or group of employees intends to
terminate  his,  her  or  their  employment  with  the  Company  or  any  of its
Subsidiaries,  nor  does  the  Company or any of its Subsidiaries have a present
intention  to  terminate the employment of any officer, key employee or group of
employees.

          4.15     Registration  Rights  and Voting Rights.  Except as set forth
                   ---------------------------------------
on  Schedule  4.15  and except as disclosed in Exchange Act Filings, neither the
Company  nor  any  of  its  Subsidiaries  is presently under any obligation, and
neither  the  Company  nor  any  of  its Subsidiaries has granted any rights, to
register  any  of  the  Company's  or  its  Subsidiaries'  presently outstanding
securities or any of its securities that may hereafter be issued.  Except as set
forth  on  Schedule 4.15 and except as disclosed in Exchange Act Filings, to the
Company's  knowledge,  no  stockholder of the Company or any of its Subsidiaries
has  entered  into any agreement with respect to the voting of equity securities
of  the  Company  or  any  of  its  Subsidiaries.

          4.16     Compliance  with  Laws; Permits.  Neither the Company nor any
                   -------------------------------
of its Subsidiaries is in violation of any applicable statute, rule, regulation,
order  or  restriction  of  any  domestic  or  foreign  government  or  any
instrumentality  or  agency thereof in respect of the conduct of its business or
the  ownership  of its properties which has had, or could reasonably be expected
to have, either individually or in the aggregate, a Material Adverse Effect.  No
governmental  orders,  permissions,  consents,  approvals  or authorizations are
required  to be obtained and no registrations or declarations are required to be
filed  in  connection  with  the execution and delivery of this Agreement or any
other  Related  Agreement and the issuance of any of the Securities, except such
as  has  been duly and validly obtained or filed, or with respect

                                       10
<PAGE>
to any filings that must be made after the Closing, as will be filed in a timely
manner.  Each  of  the Company and its Subsidiaries has all material franchises,
permits,  licenses  and  any  similar authority necessary for the conduct of its
business  as  now  being  conducted  by  it,  the  lack  of  which could, either
individually  or  in  the  aggregate,  reasonably be expected to have a Material
Adverse  Effect.

          4.17     Environmental  and  Safety Laws.  Neither the Company nor any
                   -------------------------------
of its Subsidiaries is in violation of any applicable statute, law or regulation
relating  to  the  environment  or  occupational  health  and safety, and to its
knowledge,  no  material expenditures are or will be required in order to comply
with  any  such  existing  statute,  law  or  regulation. Except as set forth on
Schedule  4.17,  no Hazardous Materials (as defined below) are used or have been
used,  stored,  or  disposed of by the Company or any of its Subsidiaries or, to
the  Company's  knowledge,  by any other person or entity on any property owned,
leased  or  used  by the Company or any of its Subsidiaries. For the purposes of
the  preceding  sentence,  "Hazardous  Materials"  shall  mean:

          (a)     materials which are listed or otherwise defined as "hazardous"
     or  "toxic"  under any applicable local, state, federal and/or foreign laws
     and regulations that govern the existence and/or remedy of contamination on
     property, the protection of the environment from contamination, the control
     of  hazardous  wastes,  or other activities involving hazardous substances,
     including  building  materials;  or

          (b)     any  petroleum  products  or  nuclear  materials.

          4.18     Valid Offering.  Assuming the accuracy of the representations
                   --------------
and warranties of the Purchaser contained in this Agreement, the offer, sale and
issuance  of the Securities will be exempt from the registration requirements of
the  Securities  Act  of  1933, as amended (the "Securities Act"), and will have
been registered or qualified (or are exempt from registration and qualification)
under  the  registration, permit or qualification requirements of all applicable
state  securities  laws.

          4.19     Full  Disclosure.  Each  of  the  Company  and  each  of  its
                   ----------------
Subsidiaries  has  provided  the Purchaser with all information requested by the
Purchaser  in  connection  with  its  decision to purchase the Note and Warrant,
including all information the Company and its Subsidiaries believe is reasonably
necessary to make such investment decision.  Neither this Agreement, the Related
Agreements, the exhibits and schedules hereto and thereto nor any other document
delivered  by  the  Company  or  any  of  its  Subsidiaries  to Purchaser or its
attorneys or agents in connection herewith or therewith or with the transactions
contemplated  hereby or thereby, contain any untrue statement of a material fact
nor  omit  to  state  a  material fact necessary in order to make the statements
contained  herein  or  therein,  in light of the circumstances in which they are
made, not misleading.  Any financial projections and other estimates provided to
the  Purchaser  by  the  Company  or  any  of its Subsidiaries were based on the
Company's and its Subsidiaries' experience in the industry and on assumptions of
fact  and  opinion  as  to  future  events  which  the  Company  or  any  of its
Subsidiaries,  at  the  date  of  the issuance of such projections or estimates,
believed  to  be  reasonable.

                                       11
<PAGE>
          4.20     Insurance.  Each  of the Company and each of its Subsidiaries
                   ---------
has  general commercial, product liability, fire and casualty insurance policies
with  coverages which the Company believes are customary for companies similarly
situated  to  the  Company and its Subsidiaries in the same or similar business.

          4.21     SEC  Reports.  Except  as  set  forth  on  Schedule 4.21, the
                   ------------
Company  has filed all proxy statements, reports and other documents required to
be  filed by it under the Exchange Act.  The Company has furnished the Purchaser
with  copies  of:  (i)  its  Annual  Reports on Form 10-KSB for its fiscal years
ended  December 31, 2002 [and December 31, 2003]; and (ii) its Quarterly Reports
on  Form  10-QSB  for its fiscal quarter ended September 30, 2003 (collectively,
the  "SEC  Reports"). Except as set forth on Schedule 4.21, each SEC Report was,
at  the  time  of its filing, in substantial compliance with the requirements of
its  respective  form  and none of the SEC Reports, nor the financial statements
(and  the  notes  thereto)  included  in the SEC Reports, as of their respective
filing  dates,  contained  any untrue statement of a material fact or omitted 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.

          4.22     Listing.  The Company's Common Stock is listed for trading on
                   -------
the  NASD  OTC Bulletin Board ("NASD BB") and satisfies all requirements for the
continuation  of such trading.  The Company has not received any notice that its
Common Stock will not be eligible to be traded on the NASD BB or that its Common
Stock  does  not  meet  all  requirements  for  such  trading.

          4.23     No  Integrated Offering.  Neither the Company, nor any of its
                   -----------------------
Subsidiaries  or  affiliates,  nor any person acting on its or their behalf, has
directly or indirectly made any offers or sales of any security or solicited any
offers  to buy any security under circumstances that would cause the offering of
the Securities pursuant to this Agreement or any of the Related Agreements to be
integrated  with  prior  offerings by the Company for purposes of the Securities
Act which would prevent the Company from selling the Securities pursuant to Rule
506  under  the  Securities  Act, or any applicable exchange-related stockholder
approval  provisions,  nor  will  the  Company  or  any  of  its  affiliates  or
Subsidiaries  take  any  action  or  steps  that would cause the offering of the
Securities  to  be  integrated  with  other  offerings.

          4.24     Stop  Transfer.  The  Securities are restricted securities as
                   --------------
of  the date of this Agreement.  Neither the Company nor any of its Subsidiaries
will issue any stop transfer order or other order impeding the sale and delivery
of  any  of  the  Securities  at  such time as the Securities are registered for
public  sale  or an exemption from registration is available, except as required
by  state  and  federal  securities  laws.

          4.25     Dilution.  The  Company  specifically  acknowledges  that its
                   --------
obligation  to  issue the shares of Common Stock upon conversion of the Note and
exercise  of  the Warrant is binding upon the Company and enforceable regardless
of  the  dilution  such  issuance  may  have on the ownership interests of other
shareholders  of  the  Company.

          4.26     Patriot  Act.     The  Company certifies that, to the best of
                   ------------
Company's  knowledge,  neither  the Company nor any of its Subsidiaries has been
designated,  and  is  not  owned  or  controlled,  by a "suspected terrorist" as
defined  in  Executive  Order  13224.  The

                                       12
<PAGE>
Company  hereby  acknowledges  that  the  Purchaser  seeks  to  comply  with all
applicable  laws  concerning  money  laundering  and  related  activities.  In
furtherance of those efforts, the Company hereby represents, warrants and agrees
that:  (i)  none  of  the  cash  or  property  that  the  Company  or any of its
Subsidiaries  will  pay or will contribute to the Purchaser has been or shall be
derived  from,  or related to, any activity that is deemed criminal under United
States  law;  and  (ii)  no contribution or payment by the Company or any of its
Subsidiaries  to the Purchaser, to the extent that they are within the Company's
and/or its Subsidiaries' control shall cause the Purchaser to be in violation of
the  United  States  Bank  Secrecy  Act,  the  United States International Money
Laundering  Control  Act  of  1986  or  the  United  States  International Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001. The Company shall
promptly  notify the Purchaser if any of these representations ceases to be true
and  accurate  regarding  the  Company  or  any of its Subsidiaries. The Company
agrees to provide the Purchaser any additional information regarding the Company
or  any  of its Subsidiaries that the Purchaser deems necessary or convenient to
ensure  compliance  with  all  applicable  laws  concerning money laundering and
similar activities. The Company understands and agrees that if at any time it is
discovered  that  any  of  the  foregoing  representations  are incorrect, or if
otherwise  required  by applicable law or regulation related to money laundering
similar  activities,  the  Purchaser may undertake appropriate actions to ensure
compliance  with  applicable  law  or  regulation,  including but not limited to
segregation  and/or redemption of the Purchaser's investment in the Company. The
Company  further  understands  that  the  Purchaser  may  release  confidential
information  about  the  Company  and  its  Subsidiaries and, if applicable, any
underlying  beneficial  owners,  to  proper authorities if the Purchaser, in its
sole discretion, in good faith determines that it is legally required to release
such  confidential  information in light of relevant rules and regulations under
the  laws  set  forth  in  subsection  (ii)  above.

     5.     Representations  and  Warranties  of  the  Purchaser.  The Purchaser
            ----------------------------------------------------
hereby  represents  and warrants to the Company as follows (such representations
and  warranties  do  not lessen or obviate the representations and warranties of
the  Company  set  forth  in  this  Agreement):

          5.1     No  Shorting.  The  Purchaser  or  any  of  its affiliates and
                  ------------
investment  partners  has not, will not and will not cause any person or entity,
directly or indirectly, to engage in "short sales" of the Company's Common Stock
as  long  as  the  Note  shall  be  outstanding.

          5.2     Requisite  Power  and  Authority.  The  Purchaser  has  all
                  --------------------------------
necessary  power and authority under all applicable provisions of law to execute
and  deliver  this  Agreement  and the Related Agreements and to carry out their
provisions.  All  corporate  action  on Purchaser's part required for the lawful
execution and delivery of this Agreement and the Related Agreements have been or
will  be  effectively  taken  prior  to  the  Closing.  Upon their execution and
delivery,  this  Agreement  and the Related Agreements will be valid and binding
obligations  of  Purchaser,  enforceable in accordance with their terms, except:

          (a)     as  limited  by  applicable  bankruptcy,  insolvency,
     reorganization,  moratorium  or other laws of general application affecting
     enforcement  of  creditors'  rights;  and

          (b)     as  limited  by general principles of equity that restrict the
     availability  of  equitable  and  legal  remedies.

                                       13
<PAGE>
          5.3     Investment  Representations.  Purchaser  understands  that the
                  ---------------------------
Securities are being offered and sold pursuant to an exemption from registration
contained  in  the Securities Act based in part upon Purchaser's representations
contained in the Agreement, including, without limitation, that the Purchaser is
an "accredited investor" within the meaning of Regulation D under the Securities
Act  of  1933, as amended (the "Securities Act"). The Purchaser confirms that it
has  received  or  has  had  full  access  to  all  the information it considers
necessary or appropriate to make an informed investment decision with respect to
the Note and the Warrant to be purchased by it under this Agreement and the Note
Shares and the Warrant Shares acquired by it upon the conversion of the Note and
the  exercise  of the Warrant, respectively. The Purchaser further confirms that
it  has had an opportunity to ask questions and receive answers from the Company
regarding the Company's and its Subsidiaries' business, management and financial
affairs  and the terms and conditions of the Offering, the Note, the Warrant and
the  Securities  and to obtain additional information (to the extent the Company
possessed  such  information  or could acquire it without unreasonable effort or
expense)  necessary  to  verify any information furnished to the Purchaser or to
which  the  Purchaser  had  access.

          5.4     Purchaser  Bears Economic Risk.  The Purchaser has substantial
                  ------------------------------
experience  in  evaluating  and  investing  in private placement transactions of
securities  in  companies  similar  to  the  Company  so  that  it is capable of
evaluating  the  merits  and  risks of its investment in the Company and has the
capacity to protect its own interests. The Purchaser must bear the economic risk
of  this  investment until the Securities are sold pursuant to: (i) an effective
registration  statement  under  the  Securities  Act;  or (ii) an exemption from
registration  is  available  with  respect  to  such  sale.

          5.5     Acquisition  for  Own Account.  The Purchaser is acquiring the
                  -----------------------------
Note  and Warrant and the Note Shares and the Warrant Shares for the Purchaser's
own  account  for  investment only, and not as a nominee or agent and not with a
view  towards  or  for  resale  in  connection  with  their  distribution.

          5.6     Purchaser  Can Protect Its Interest.  The Purchaser represents
                  -----------------------------------
that  by  reason  of  its,  or  of  its  management's,  business  and  financial
experience,  the  Purchaser has the capacity to evaluate the merits and risks of
its  investment  in  the Note, the Warrant and the Securities and to protect its
own interests in connection with the transactions contemplated in this Agreement
and the other Related Agreements.  Further, Purchaser is aware of no publication
of  any  advertisement  in  connection with the transactions contemplated in the
Agreement  or  the  Related  Agreements.

          5.7     Accredited  Investor.  Purchaser  represents  that  it  is  an
                  --------------------
accredited investor within the meaning of Regulation D under the Securities Act.

          5.8     Legends.
                  -------

          (a)     The Note shall bear substantially the following legend:

          "THIS  NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS
          NOTE  HAVE  NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
          AS  AMENDED,  OR ANY

                                       14
<PAGE>
          APPLICABLE, STATE SECURITIES LAWS. THIS NOTE AND THE COMMON STOCK
          ISSUABLE  UPON  CONVERSION  OF THIS NOTE MAY NOT BE SOLD, OFFERED
          FOR  SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
          REGISTRATION  STATEMENT AS TO THIS NOTE OR SUCH SHARES UNDER SAID
          ACT AND APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
          REASONABLY  SATISFACTORY  TO  SEQUIAM  CORPORATION  THAT  SUCH
          REGISTRATION  IS  NOT  REQUIRED."

          (b)     The  Note Shares and the Warrant Shares, if not issued by DWAC
     system  (as  hereinafter  defined),  shall  bear a legend which shall be in
     substantially  the  following  form  until  such  shares  are covered by an
     effective  registration  statement  filed  with  the  SEC:

          "THE  SHARES  REPRESENTED  BY  THIS  CERTIFICATE  HAVE  NOT  BEEN
          REGISTERED  UNDER  THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
          APPLICABLE  STATE  SECURITIES LAWS. THESE SHARES MAY NOT BE SOLD,
          OFFERED  FOR  SALE,  PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
          EFFECTIVE  REGISTRATION  STATEMENT  UNDER SUCH SECURITIES ACT AND
          APPLICABLE  STATE  LAWS  OR  AN  OPINION  OF  COUNSEL  REASONABLY
          SATISFACTORY TO SEQUIAM CORPORATION THAT SUCH REGISTRATION IS NOT
          REQUIRED."

          (c)     The  Warrant  shall  bear  substantially the following legend:

          "THIS  WARRANT  AND  THE  COMMON SHARES ISSUABLE UPON EXERCISE OF
          THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
          1933,  AS  AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THIS
          WARRANT  AND  THE  COMMON  SHARES  ISSUABLE UPON EXERCISE OF THIS
          WARRANT  MAY  NOT  BE  SOLD,  OFFERED  FOR  SALE,  PLEDGED  OR
          HYPOTHECATED  IN  THE  ABSENCE  OF  AN  EFFECTIVE  REGISTRATION
          STATEMENT  AS  TO THIS WARRANT OR THE UNDERLYING SHARES OF COMMON
          STOCK  UNDER  SAID ACT AND APPLICABLE STATE SECURITIES LAWS OR AN
          OPINION OF COUNSEL REASONABLY SATISFACTORY TO SEQUIAM CORPORATION
          THAT  SUCH  REGISTRATION  IS  NOT  REQUIRED."

     6.     Covenants of the Company.  The Company covenants and agrees with the
            ------------------------
Purchaser  as  follows:

          6.1     Stop-Orders.  The  Company will advise the Purchaser, promptly
                  -----------
after  it  receives notice of issuance by the Securities and Exchange Commission
(the  "SEC"),  any state securities commission or any other regulatory authority
of  any  stop order or of any order

                                       15
<PAGE>
preventing  or  suspending  any offering of any securities of the Company, or of
the  suspension  of  the  qualification  of  the Common Stock of the Company for
offering  or  sale  in any jurisdiction, or the initiation of any proceeding for
any  such  purpose.

          6.2     Listing.  The Company shall promptly secure the listing of the
                  -------
shares  of  Common  Stock  issuable  upon  conversion  of  the Note and upon the
exercise  of  the  Warrant  on  the  NASD BB (the "Principal Market") upon which
shares  of  Common Stock are listed (subject to official notice of issuance) and
shall maintain such listing so long as any other shares of Common Stock shall be
so  listed.  The  Company  will  maintain the listing of its Common Stock on the
Principal  Market,  and  will comply in all material respects with the Company's
reporting,  filing  and  other  obligations  under  the  bylaws  or rules of the
National  Association  of  Securities  Dealers  ("NASD")  and such exchanges, as
applicable.

          6.3     Market  Regulations.  The  Company  shall notify the SEC, NASD
                  -------------------
and  applicable state authorities, in accordance with their requirements, of the
transactions  contemplated by this Agreement, and shall take all other necessary
action  and proceedings as may be required and permitted by applicable law, rule
and  regulation,  for  the  legal  and  valid  issuance of the Securities to the
Purchaser  and  promptly  provide  copies  thereof  to  the  Purchaser.

          6.4     Reporting Requirements.  The Company will timely file with the
                  ----------------------
SEC  all  reports  required to be filed pursuant to the Exchange Act and refrain
from  terminating  its  status as an issuer required by the Exchange Act to file
reports  thereunder  even  if  the  Exchange  Act  or  the  rules or regulations
thereunder  would  permit  such  termination.

          6.5     Use  of  Funds.  The  Company  agrees that the proceeds of the
                  --------------
sale of the Note and the Warrant shall be used by the Company and the Subsidiary
Guarantors  for their respective general working capital purposes only; provided
that,  notwithstanding  the  foregoing,  none of the proceeds of the sale of the
Note  or  the  Warrant  shall  be  used to pay any portion of the Accrued Salary
Amount  (as  defined  in  the  Subordination  Agreement)  or to repay any of the
Outstanding  Indebtedness  (as  defined  in  the  Subordination  Agreement.

          6.6     Access  to  Facilities.  Each  of  the Company and each of its
                  ----------------------
Subsidiaries will permit any representatives designated by the Purchaser (or any
successor  of  the Purchaser), upon reasonable notice and during normal business
hours,  at  such  person's  expense  and  accompanied by a representative of the
Company,  to:

          (a)     visit  and inspect any of the properties of the Company or any
     of  its  Subsidiaries;

          (b)     examine  the corporate and financial records of the Company or
     any  of  its  Subsidiaries  (unless  such  examination  is not permitted by
     federal,  state  or  local  law  or by contract) and make copies thereof or
     extracts  therefrom;  and

          (c)     discuss  the  affairs, finances and accounts of the Company or
     any  of  its  Subsidiaries  with  the  directors,  officers and independent
     accountants  of  the  Company  or  any  of  its  Subsidiaries.

                                       16
<PAGE>
Notwithstanding  the  foregoing, neither the Company nor any of its Subsidiaries
will  provide  any  material, non-public information to the Purchaser unless the
Purchaser  signs  a  confidentiality  agreement  and  otherwise  complies  with
Regulation  FD,  under  the  federal  securities  laws.

          6.7     Taxes.  Each  of the Company and each of its Subsidiaries will
                  -----
promptly  pay  and  discharge,  or cause to be paid and discharged, when due and
payable,  all  lawful  taxes,  assessments  and  governmental  charges or levies
imposed  upon  the  income, profits, property or business of the Company and its
Subsidiaries;  provided,  however, that any such tax, assessment, charge or levy
need  not  be  paid if the validity thereof shall currently be contested in good
faith by appropriate proceedings and if the Company and/or such Subsidiary shall
have  set  aside  on  its  books  adequate  reserves  with  respect thereto, and
provided,  further,  that  the  Company  and  its Subsidiaries will pay all such
taxes,  assessments,  charges  or  levies  forthwith  upon  the  commencement of
proceedings  to foreclose any lien which may have attached as security therefor.

          6.8     Insurance.  Each of the Company and its Subsidiaries will keep
                  ---------
its  assets which are of an insurable character insured by financially sound and
reputable  insurers  against  loss  or damage by fire, explosion and other risks
customarily  insured against by companies in similar business similarly situated
as  the  Company and its Subsidiaries; and the Company and its Subsidiaries will
maintain, with financially sound and reputable insurers, insurance against other
hazards and risks and liability to persons and property to the extent and in the
manner  which  the  Company  reasonably  believes  is customary for companies in
similar  business  similarly situated as the Company and its Subsidiaries and to
the  extent available on commercially reasonable terms. The Company, and each of
its  Subsidiaries will jointly and severally bear the full risk of loss from any
loss  of  any  nature  whatsoever  with  respect  to  the  assets pledged to the
Purchaser  as  security  for  its  obligations  hereunder  and under the Related
Agreements.  At  the  Company's  and each of its Subsidiaries' joint and several
cost  and  expense  in  amounts  and  with  carriers  reasonably  acceptable  to
Purchaser,  the  Company  and  each  of  its Subsidiaries shall (i) keep all its
insurable  properties and properties in which it has an interest insured against
the hazards of fire, flood, sprinkler leakage, those hazards covered by extended
coverage insurance and such other hazards, and for such amounts, as is customary
in  the  case of companies engaged in businesses similar to the Company's or the
respective Subsidiary's including business interruption insurance; (ii) maintain
a  bond  in  such  amounts  as  is customary in the case of companies engaged in
businesses  similar  to  the  Company's  or the respective Subsidiary's insuring
against  larceny,  embezzlement  or other criminal misappropriation of insured's
officers  and employees who may either singly or jointly with others at any time
have  access  to  the  assets or funds of the Company or any of its Subsidiaries
either  directly or through governmental authority to draw upon such funds or to
direct  generally  the  disposition  of  such  assets; (iii) maintain public and
product  liability  insurance  against  claims  for  personal  injury,  death or
property damage suffered by others; (iv) maintain all such worker's compensation
or  similar  insurance  as  may  be  required  under  the  laws  of any state or
jurisdiction  in  which  the  Company or the respective Subsidiary is engaged in
business; and (v) furnish Purchaser with (x) copies of all policies and evidence
of  the  maintenance  of  such  policies  at  least  thirty (30) days before any
expiration  date,  (y)  excepting  the  Company's  workers' compensation policy,
endorsements  to  such  policies naming Purchaser as "co-insured" or "additional
insured"  and  appropriate  loss  payable  endorsements  in  form  and substance
satisfactory to Purchaser, naming Purchaser as loss payee, and (z) evidence that
as  to  Purchaser the insurance coverage shall not be impaired or invalidated by
any act or neglect of the

                                       17
<PAGE>
Company  or  any Subsidiary and the insurer will provide Purchaser with at least
thirty  (30)  days notice prior to cancellation. The Company and each Subsidiary
shall  instruct the insurance carriers that in the event of any loss thereunder,
the  carriers  shall  make  payment  for  such  loss  to  the Company and/or the
Subsidiary and Purchaser jointly. In the event that as of the date of receipt of
each  loss  recovery  upon any such insurance, the Purchaser has not declared an
event  of  default  with  respect  to  this  Agreement  or  any  of  the Related
Agreements, then the Company and/or such Subsidiary shall be permitted to direct
the  application  of  such loss recovery proceeds toward investment in property,
plant  and  equipment  that  would  comprise "Collateral" secured by Purchaser's
security  interest pursuant to its security agreement, with any surplus funds to
be applied toward payment of the obligations of the Company to Purchaser. In the
event  that  Purchaser has properly declared an event of default with respect to
this  Agreement  or  any  of  the  Related  Agreements, then all loss recoveries
received  by  Purchaser upon any such insurance thereafter may be applied to the
obligations  of  the Company hereunder and under the Related Agreements, in such
order as the Purchaser may determine. Any surplus (following satisfaction of all
Company  obligations  to Purchaser) shall be paid by Purchaser to the Company or
applied  as  may  be  otherwise required by law. Any deficiency thereon shall be
paid  by  the Company or the Subsidiary, as applicable, to Purchaser, on demand.

          6.9     Intellectual  Property.  Each  of  the Company and each of its
                  ----------------------
Subsidiaries  shall  maintain in full force and effect its existence, rights and
franchises  and all licenses and other rights to use Intellectual Property owned
or  possessed  by it and reasonably deemed to be necessary to the conduct of its
business.

          6.10     Properties.  Each of the Company and each of its Subsidiaries
                   ----------
will keep its properties in good repair, working order and condition, reasonable
wear  and  tear  excepted,  and  from  time  to time make all needful and proper
repairs, renewals, replacements, additions and improvements thereto; and each of
the  Company  and  each  of  its Subsidiaries will at all times comply with each
provision  of  all  leases  to  which  it  is a party or under which it occupies
property  if  the  breach of such provision could, either individually or in the
aggregate,  reasonably  be  expected  to  have  a  Material  Adverse  Effect.

          6.11     Confidentiality.  The  Company  agrees  that  it  will  not
                   ---------------
disclose,  and  will  not  include  in  any public announcement, the name of the
Purchaser,  unless expressly agreed to by the Purchaser or unless and until such
disclosure  is  required  by  law or applicable regulation, and then only to the
extent  of  such  requirement.  Notwithstanding  the  foregoing, the Company may
disclose Purchaser's identity and the terms of this Agreement to its current and
prospective  debt  and  equity  financing  sources.

          6.12     Required Approvals.  For so long as twenty-five percent (25%)
                   ------------------
of  the  principal  amount  of the Note is outstanding, the Company, without the
prior  written  consent  of  the  Purchaser,  shall  not:

          (a)     directly  or  indirectly  declare  or pay any dividends, other
     than dividends paid to the Company or any of its wholly-owned Subsidiaries;

          (b)     issue  any  preferred  equity  interests;

                                       18
<PAGE>
          (c)     liquidate,  dissolve  or  effect  a  material  reorganization;

          (d)     become  subject  to  (including, without limitation, by way of
     amendment  to  or modification of) any agreement or instrument which by its
     terms  would (under any circumstances) restrict the Company's or any of its
     Subsidiaries  right  to perform the provisions of this Agreement, any other
     Related  Agreement or any of the agreements contemplated hereby or thereby;

          (e)     materially  alter  or  change the scope of the business of the
     Company  and  its  Subsidiaries  taken  as  a  whole;

          (f)     (i)  create, incur, assume or suffer to exist any indebtedness
     (exclusive  of  trade  debt  and  debt  incurred to finance the purchase of
     equipment  (not in excess of five percent (5%) per annum of the fair market
     value  of the Company's assets) whether secured or unsecured other than (x)
     the  Company's  indebtedness  to  Laurus,  (y)  indebtedness  set  forth on
     Schedule  6.12(f)  attached  hereto  and  made  a  part  hereof  and  any
     ----------------
     refinancings  or  replacements  thereof  on  terms no less favorable to the
     Purchaser  than  the indebtedness being refinanced or replaced, and (z) any
     debt  incurred  in  connection  with the purchase of assets in the ordinary
     course of business, or any refinancings or replacements thereof on terms no
     less  favorable  to the Purchaser than the indebtedness being refinanced or
     replaced;  (ii)  cancel  any  debt  owing to it in excess of $50,000 in the
     aggregate  during  any 12 month period; (iii) assume, guarantee, endorse or
     otherwise  become  directly  or  contingently liable in connection with any
     obligations  of  any other person, except (x) the endorsement of negotiable
     instruments  by  the  Company  for  deposit  or  collection  or  similar
     transactions  in  the  ordinary  course  of  business,  (y)  guarantees  of
     indebtedness  otherwise permitted to be outstanding pursuant to this clause
     (f)  or  (z)  obligations  of the Company and/or any of its Subsidiaries to
     indemnify  directors'  officers'  and  agents'  pursuant  to  customary and
     ordinary  course  indemnification  arrangements set forth in the respective
     certificate  of  incorporation,  by-laws  or  other  agreement;  and

          (g)     create  or acquire any Subsidiary after the date hereof unless
     (i)  such  Subsidiary  is a wholly-owned Subsidiary of the Company and (ii)
     such  Subsidiary  becomes party to the Master Security Agreement, the Stock
     Pledge  Agreement  and  the  Subsidiary  Guaranty  (either  by  executing a
     counterpart  thereof  or  an  assumption or join under agreement in respect
     thereof)  and,  to  the  extent  required  by the Purchaser, satisfies each
     condition  of  this  Agreement  and  the  Related  Agreements  as  if  such
     Subsidiary  were  a  Subsidiary  on  the  Closing  Date.

          6.13     Reissuance  of  Securities.  The  Company  agrees  to reissue
                   --------------------------
certificates  representing  the  Securities  without  the  legends  set forth in
Section  5.7  above  at  such  time  as:

          (a)     the  holder thereof is permitted to dispose of such Securities
     pursuant  to  Rule  144(k)  under  the  Securities  Act;  or

          (b)     upon  resale  subject  to  an effective registration statement
     after  such  Securities  are  registered  under  the  Securities  Act.

                                       19
<PAGE>
The  Company  agrees  to  cooperate  with  the  Purchaser in connection with all
resales  pursuant  to  Rule  144(d)  and  Rule 144(k) and provide legal opinions
necessary  to  allow  such  resales provided the Company and its counsel receive
reasonably  requested  representations from the selling Purchaser and broker, if
any.

          6.14     Opinion.  On  the  Closing  Date, the Company will deliver to
                   -------
the Purchaser an opinion acceptable to the Purchaser from the Company's external
legal  counsel.  The  Company will provide, at the Company's expense, such other
legal opinions in the future as are deemed reasonably necessary by the Purchaser
(and  acceptable to the Purchaser) in connection with the conversion of the Note
and  exercise  of  the  Warrant.

          6.15     Additional Investment.  The Company agrees that the Purchaser
                   ---------------------
shall  have the right (at its sole option), on or prior to the date which is 270
days  following  the Closing Date, to issue an additional note to the Company in
an  aggregate  principal  amount  of  up  to  $1,200,000  on  the same terms and
conditions  (including,  without  limitation,  the same interest rate, the Fixed
Conversion  Price (as defined in the Note) then in effect, proportionate warrant
coverage  (at  the same exercise prices), a proportionate amortization schedule,
etc.) set forth in, and pursuant to substantially similar documentation as, this
Agreement  and  the  Related  Agreements  (it  being  understood  that the right
contained  in  this  Section  11.14 is in addition to the Purchaser's contingent
obligation  to  provide  incremental  funding  as set forth in that certain side
letter,  dated  the  date  hereof,  between  the  Company  and  the  Purchaser).

     7.     Covenants of the Purchaser.  The Purchaser covenants and agrees with
            --------------------------
the  Company  as  follows:

          7.1     Confidentiality.  The  Purchaser  agrees  that  it  will  not
                  ---------------
disclose,  and  will  not  include  in  any public announcement, the name of the
Company,  unless  expressly  agreed  to  by the Company or unless and until such
disclosure  is  required  by  law or applicable regulation, and then only to the
extent  of  such  requirement.

          7.2     Non-Public  Information.  The  Purchaser  agrees not to effect
                  -----------------------
any  sales  in  the  shares of the Company's Common Stock while in possession of
material,  non-public  information  regarding  the  Company  if such sales would
violate  applicable  securities  law.

     8.     Covenants  of  the  Company and Purchaser Regarding Indemnification.
            -------------------------------------------------------------------

          8.1     Company  Indemnification.  The  Company  agrees  to indemnify,
                  ------------------------
hold  harmless,  reimburse  and  defend  the  Purchaser, each of the Purchaser's
officers,  directors,  agents,  affiliates,  control  persons,  and  principal
shareholders,  against  any claim, cost, expense, liability, obligation, loss or
damage  (including  reasonable legal fees) of any nature, incurred by or imposed
upon  the  Purchaser  which  results,  arises  out  of or is based upon: (i) any
misrepresentation  by  the  Company  or any of its Subsidiaries or breach of any
warranty  by the Company or any of its Subsidiaries in this Agreement, any other
Related Agreement or in any exhibits or schedules attached hereto or thereto; or
(ii)  any breach or default in performance by Company or any of its Subsidiaries
of  any  covenant  or  undertaking  to  be  performed  by  Company or any of its
Subsidiaries hereunder, under any other Related Agreement or any other agreement
entered  into  by  the  Company  and/or  any  of  its Subsidiaries and Purchaser
relating  hereto  or  thereto.

                                       20
<PAGE>
          8.2     Purchaser's  Indemnification.  Purchaser  agrees to indemnify,
                  ----------------------------
hold  harmless,  reimburse  and  defend  the  Company  and each of the Company's
officers,  directors,  agents,  affiliates,  control  persons  and  principal
shareholders,  at  all  times  against  any  claim,  cost,  expense,  liability,
obligation,  loss  or  damage  (including  reasonable legal fees) of any nature,
incurred by or imposed upon the Company which results, arises out of or is based
upon:  (i)  any  misrepresentation  by  Purchaser  or  breach of any warranty by
Purchaser  in  this Agreement or in any exhibits or schedules attached hereto or
any Related Agreement; or (ii) any breach or default in performance by Purchaser
of  any  covenant  or undertaking to be performed by Purchaser hereunder, or any
other  agreement  entered  into  by  the  Company and Purchaser relating hereto.

          8.3     Procedures.  The  procedures  and  limitations  set  forth  in
                  ----------
Section  10.2(c)  and  (d)  shall  apply  to  the  indemnifications set forth in
Sections  8.1  and  8.2  above.

     9.     Conversion  of  Convertible  Note.
            ---------------------------------

          9.1     Mechanics  of  Conversion.
                  -------------------------

          (a)     Provided  the  Purchaser  has  notified  the  Company  of  the
     Purchaser's  intention  to  sell  the  Note  Shares and the Note Shares are
     included  in  an  effective  registration statement or are otherwise exempt
     from  registration  when  sold: (i) upon the conversion of the Note or part
     thereof, the Company shall, at its own cost and expense, take all necessary
     action  (including  the  issuance  of  an  opinion  of  counsel  reasonably
     acceptable to the Purchaser following a request by the Purchaser) to assure
     that  the  Company's  transfer  agent  shall  issue shares of the Company's
     Common  Stock  in  the name of the Purchaser (or its nominee) or such other
     persons  as  designated  by the Purchaser in accordance with Section 9.1(b)
     hereof and in such denominations to be specified representing the number of
     Note  Shares  issuable  upon such conversion; and (ii) the Company warrants
     that  no  instructions  other  than these instructions have been or will be
     given  to  the  transfer agent of the Company's Common Stock and that after
     the  Effectiveness  Date  (as defined in the Registration Rights Agreement)
     the  Note  Shares  issued  will  be  freely  transferable  subject  to  the
     prospectus  delivery  requirements of the Securities Act and the provisions
     of  this Agreement, and will not contain a legend restricting the resale or
     transferability  of  the  Note  Shares.

          (b)     Purchaser  will  give  notice  of its decision to exercise its
     right  to  convert  the  Note  or  part thereof by telecopying or otherwise
     delivering  an  executed and completed notice of the number of shares to be
     converted  to  the Company (the "Notice of Conversion"). The Purchaser will
     not be required to surrender the Note until the Purchaser receives a credit
     to  the account of the Purchaser's prime broker through the DWAC system (as
     defined  below),  representing  the  Note Shares or until the Note has been
     fully satisfied. Each date on which a Notice of Conversion is telecopied or
     delivered  to the Company in accordance with the provisions hereof shall be
     deemed  a  "Conversion  Date."  Pursuant  to  the  terms  of  the Notice of
     Conversion,  the  Borrower  will  issue  instructions to the transfer agent
     accompanied  by  an  opinion  of counsel within one (1) business day of the
     date  of  the  delivery  to  Borrower of the Notice of Conversion and shall
     cause  the  transfer  agent  to  transmit the certificates representing the
     Conversion Shares to the Holder by crediting the account of the Purchaser's
     prime  broker with the

                                       21
<PAGE>
     Depository  Trust  Company  ("DTC")  through  its  Deposit Withdrawal Agent
     Commission  ("DWAC") system within three (3) business days after receipt by
     the  Company  of  the  Notice  of  Conversion  (the  "Delivery  Date").

          (c)     The  Company  understands  that a delay in the delivery of the
     Note  Shares  in  the form required pursuant to Section 9 hereof beyond the
     Delivery  Date could result in economic loss to the Purchaser. In the event
     that  the  Company  fails  to direct its transfer agent to deliver the Note
     Shares to the Purchaser via the DWAC system within the time frame set forth
     in  Section  9.1(b)  above  and  the  Note  Shares are not delivered to the
     Purchaser  by  the Delivery Date, as compensation to the Purchaser for such
     loss,  the  Company  agrees  to pay late payments to the Purchaser for late
     issuance  of  the  Note  Shares  in the form required pursuant to Section 9
     hereof  upon  conversion of the Note in the amount equal to the greater of:
     (i)  $500 per business day after the Delivery Date; or (ii) the Purchaser's
     actual  damages  from such delayed delivery. Notwithstanding the foregoing,
     the  Company  will  not owe the Purchaser any late payments if the delay in
     the  delivery  of the Note Shares beyond the Delivery Date is solely out of
     the  control  of the Company and the Company is actively trying to cure the
     cause  of the delay. The Company shall pay any payments incurred under this
     Section  in  immediately  available  funds  upon demand and, in the case of
     actual  damages,  accompanied  by reasonable documentation of the amount of
     such  damages. Such documentation shall show the number of shares of Common
     Stock  the  Purchaser is forced to purchase (in an open market transaction)
     which  the  Purchaser anticipated receiving upon such conversion, and shall
     be  calculated  as  the  amount by which (A) the Purchaser's total purchase
     price (including customary brokerage commissions, if any) for the shares of
     Common  Stock  so  purchased  exceeds  (B)  the  aggregate principal and/or
     interest  amount  of  the  Note,  for  which such Conversion Notice was not
     timely  honored.

Nothing  contained  herein or in any document referred to herein or delivered in
connection  herewith  shall  be  deemed to establish or require the payment of a
rate  of  interest  or  other  charges  in  excess  of  the maximum permitted by
applicable law.  In the event that the rate of interest or dividends required to
be  paid  or other charges hereunder exceed the maximum amount permitted by such
law,  any  payments  in excess of such maximum shall be credited against amounts
owed  by  the  Company  to  a  Purchaser  and  thus  refunded  to  the  Company.

     10.     Registration  Rights.

          10.1     Registration  Rights  Granted.  The  Company  hereby  grants
                   -----------------------------
registration rights to the Purchaser pursuant to a Registration Rights Agreement
dated  as  of  even  date  herewith  between  the  Company  and  the  Purchaser.

          10.2     Offering Restrictions.  Except as previously disclosed in the
                   ---------------------
SEC Reports or in the Exchange Act Filings, or stock or stock options granted to
employees  or  directors of the Company(these exceptions hereinafter referred to
as  the  "Excepted  Issuances"), neither the Company nor any of its Subsidiaries
will  issue  any  securities  with  a  continuously variable/floating conversion
feature  which  are  or  could  be  (by conversion or registration) free-trading
securities  (i.e. common stock subject to a registration statement) prior to the
full

                                       22
<PAGE>
repayment  or  conversion  of  the  Note  (together  with all accrued and unpaid
interest and fees related thereto) (the "Exclusion Period").

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

          11.1     Governing  Law.  THIS  AGREEMENT  AND  EACH RELATED AGREEMENT
                   --------------
SHALL  BE  GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.  ANY ACTION BROUGHT
BY  EITHER  PARTY  AGAINST THE OTHER CONCERNING THE TRANSACTIONS CONTEMPLATED BY
THIS  AGREEMENT  AND  EACH  RELATED AGREEMENT SHALL BE BROUGHT ONLY IN THE STATE
COURTS  OF  NEW  YORK OR IN THE FEDERAL COURTS LOCATED IN THE STATE OF NEW YORK.
BOTH  PARTIES  AND  THE  INDIVIDUALS  EXECUTING  THIS  AGREEMENT AND THE RELATED
AGREEMENTS  ON BEHALF OF THE COMPANY AGREE TO SUBMIT TO THE JURISDICTION OF SUCH
COURTS  AND  WAIVE  TRIAL  BY  JURY.  IN  THE  EVENT  THAT ANY PROVISION OF THIS
AGREEMENT  OR  ANY RELATED AGREEMENT DELIVERED IN CONNECTION HEREWITH IS INVALID
OR  UNENFORCEABLE  UNDER  ANY  APPLICABLE  STATUTE  OR  RULE  OF  LAW, THEN SUCH
PROVISION  SHALL  BE  DEEMED  INOPERATIVE  TO  THE  EXTENT  THAT IT MAY CONFLICT
THEREWITH  AND  SHALL BE DEEMED MODIFIED TO CONFORM WITH SUCH STATUTE OR RULE OF
LAW.  ANY  SUCH PROVISION WHICH MAY PROVE INVALID OR UNENFORCEABLE UNDER ANY LAW
SHALL  NOT  AFFECT THE VALIDITY OR ENFORCEABILITY OF ANY OTHER PROVISION OF THIS
AGREEMENT  OR  ANY  RELATED  AGREEMENT.

          11.2     Survival.  The  representations,  warranties,  covenants  and
                   --------
agreements made herein shall survive any investigation made by the Purchaser and
the  closing  of  the  transactions  contemplated  hereby to the extent provided
therein.  All  statements  as to factual matters contained in any certificate or
other  instrument  delivered  by  or on behalf of the Company pursuant hereto in
connection  with  the  transactions  contemplated  hereby  shall be deemed to be
representations and warranties by the Company hereunder solely as of the date of
such  certificate  or  instrument.

          11.3     Successors.  Except  as  otherwise expressly provided herein,
                   ----------
the  provisions  hereof  shall inure to the benefit of, and be binding upon, the
successors,  heirs, executors and administrators of the parties hereto and shall
inure  to the benefit of and be enforceable by each person who shall be a holder
of  the  Securities  from  time  to time, other than the holders of Common Stock
which  has  been  sold  by  the  Purchaser  pursuant to Rule 144 or an effective
registration  statement.  Purchaser  may  not  assign  its rights hereunder to a
competitor  of  the  Company.

          11.4     Entire  Agreement.  This  Agreement,  the Related Agreements,
                   -----------------
the  exhibits and schedules hereto and thereto and the other documents delivered
pursuant  hereto  constitute  the  full  and  entire understanding and agreement
between  the  parties  with  regard to the subjects hereof and no party shall be
liable  or  bound to any other in any manner by any representations, warranties,
covenants  and  agreements  except as specifically set forth herein and therein.

                                       23
<PAGE>
          11.5     Severability.  In  case  any provision of the Agreement shall
                   ------------
be  invalid, illegal or unenforceable, the validity, legality and enforceability
of  the  remaining  provisions  shall  not  in  any  way be affected or impaired
thereby.

          11.6     Amendment  and  Waiver.
                   ----------------------

          (a)     This  Agreement  may  be  amended  or  modified  only upon the
     written  consent  of  the  Company  and  the  Purchaser.

          (b)     The obligations of the Company and the rights of the Purchaser
     under  this  Agreement  may  be waived only with the written consent of the
     Purchaser.

          (c)     The obligations of the Purchaser and the rights of the Company
     under  this  Agreement  may  be waived only with the written consent of the
     Company.

     11.7     Delays  or  Omissions.  It  is agreed that no delay or omission to
              ---------------------
exercise  any  right,  power  or  remedy accruing to any party, upon any breach,
default  or  noncompliance  by another party under this Agreement or the Related
Agreements,  shall  impair  any  such  right,  power  or remedy, nor shall it be
construed  to  be  a waiver of any such breach, default or noncompliance, or any
acquiescence  therein,  or of or in any similar breach, default or noncompliance
thereafter  occurring.  All remedies, either under this Agreement or the Related
Agreements,  by  law or otherwise afforded to any party, shall be cumulative and
not  alternative.

     11.8     Notices.  All  notices required or permitted hereunder shall be in
              -------
writing and shall be deemed effectively given:

          (a)     upon  personal  delivery  to  the  party  to  be  notified;

          (b)     when  sent  by  confirmed  facsimile  if  sent  during  normal
     business  hours  of  the  recipient, if not, then on the next business day;

          (c)     three  (3)  business days after having been sent by registered
     or  certified  mail,  return  receipt  requested,  postage  prepaid;  or

          (d)     one  (1)  day  after  deposit  with  a  nationally  recognized
     overnight  courier, specifying next day delivery, with written verification
     of  receipt.

All communications shall be sent as follows:

     If to the Company, to:    Sequiam  Corporation
                               300  Sunport  Lane
                               Orlando,  FL  32809

                               Attention:  Mark  L.  Mroczkowski
                               Facsimile:  407-240-1431

                                       24
<PAGE>
                               with  a  copy  to:
                               Greenberg  Traurig,  P.A.
                               450  South  Orange  Avenue,  Suite  650
                               Orlando,  Florida  32801
                               Attention:  Randolph  Fields,  Esq.
                               Facsimile:  407-650-8472

     If to the Purchaser, to:  Laurus  Master  Fund,  Ltd.
                               c/o  Ironshore  Corporate  Services  ltd.
                               P.O.  Box  1234  G.T.
                               Queensgate  House,  South  Church  Street
                               Grand  Cayman,  Cayman  Islands
                               Facsimile:  345-949-9877

                               with  a  copy  to:

                               John  E.  Tucker,  Esq.
                               825  Third  Avenue  14th  Floor
                               New  York,  NY  10022
                               Facsimile:  212-541-4434

or  at  such  other  address  as  the  Company or the Purchaser may designate by
written notice to the other parties hereto given in accordance herewith.

          11.9     Attorneys'  Fees.  In  the  event  that any suit or action is
                   ----------------
instituted  to  enforce any provision in this Agreement, the prevailing party in
such  dispute shall be entitled to recover from the losing party all fees, costs
and  expenses  of  enforcing  any  right  of such prevailing party under or with
respect  to  this Agreement, including, without limitation, such reasonable fees
and  expenses  of  attorneys  and  accountants,  which  shall  include,  without
limitation,  all  fees,  costs  and  expenses  of  appeals.

          11.10     Titles  and  Subtitles.  The  titles  of  the  sections  and
                    ----------------------
subsections  of this Agreement are for convenience of reference only and are not
to  be  considered  in  construing  this  Agreement.

          11.11     Facsimile  Signatures;  Counterparts.  This Agreement may be
                    ------------------------------------
executed  by  facsimile  signatures  and  in any number of counterparts, each of
which  shall  be  an  original,  but  all of which together shall constitute one
instrument.

          11.12     Broker's  Fees.  Except  as  set  forth  on  Schedule  11.12
                    --------------
hereof,  each  party  hereto  represents  and  warrants  that  no agent, broker,
investment  banker, person or firm acting on behalf of or under the authority of
such  party hereto is or will be entitled to any broker's or finder's fee or any
other  commission  directly  or  indirectly  in connection with the transactions
contemplated  herein.  Each  party hereto further agrees to indemnify each other
party  for  any  claims,  losses  or  expenses incurred by such other party as a
result  of  the  representation  in  this  Section  11.12  being  untrue.

                                       25
<PAGE>
          11.13     Construction.  Each  party  acknowledges  that  its  legal
                    ------------
counsel  participated  in  the  preparation  of  this  Agreement and the Related
Agreements  and,  therefore,  stipulates  that  the  rule  of  construction that
ambiguities  are  to be resolved against the drafting party shall not be applied
in  the  interpretation  of this Agreement to favor any party against the other.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]

                                       26
<PAGE>
     IN  WITNESS  WHEREOF,  the  parties  hereto  have  executed  the SECURITIES
PURCHASE AGREEMENT as of the date set forth in the first paragraph hereof.

COMPANY:                              PURCHASER:

SEQUIAM CORPORATION                   LAURUS MASTER FUND, LTD.

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

                                       27
<PAGE>
                                    EXHIBIT A
                            FORM OF CONVERTIBLE NOTE

                                      A-1
<PAGE>
                                    EXHIBIT B
                                 FORM OF WARRANT

                                      B-1
<PAGE>
                                    EXHIBIT C
                                 FORM OF OPINION

                                      C-1
<PAGE>
                                    EXHIBIT D
                            FORM OF ESCROW AGREEMENT

                                      D-1
<PAGE>Exhibit 10.2

THIS  NOTE  AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT
BEEN  REGISTERED  UNDER  THE  SECURITIES  ACT  OF 1933, AS AMENDED, OR ANY STATE
SECURITIES  LAWS.  THIS  NOTE  AND THE COMMON SHARES ISSUABLE UPON CONVERSION OF
THIS  NOTE  MAY  NOT  BE  SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE  OF  AN  EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE UNDER SAID ACT
AND  ANY  APPLICABLE  STATE  SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY  TO  SEQUIAM  CORPORATION  THAT  SUCH REGISTRATION IS NOT REQUIRED.

                          SECURED CONVERTIBLE TERM NOTE
                          -----------------------------

     FOR  VALUE  RECEIVED,  SEQUIAM  CORPORATION,  a California corporation (the
"BORROWER"),  hereby  promises to pay to LAURUS MASTER FUND, LTD., c/o Ironshore
Corporate  Services  Ltd.,  P.O.  Box  1234 G.T., Queensgate House, South Church
Street,  Grand  Cayman,  Cayman Islands, Fax: 345-949-9877 (the "HOLDER") or its
registered  assigns  or successors in interest, on order, the sum of Two Million
Dollars  ($2,000,000),  together with any accrued and unpaid interest hereon, on
April 27, 2007 (the "MATURITY DATE") if not sooner paid.

     Capitalized  terms  used  herein without definition shall have the meanings
ascribed to such terms in that certain Securities Purchase Agreement dated as of
the  date hereof between the Borrower and the Holder (the "PURCHASE AGREEMENT").

The following terms shall apply to this Note:

                                    ARTICLE I
                             INTEREST & AMORTIZATION

     1.1  (a)  Interest Rate.  Subject to Sections 4.11 and 5.6 hereof, interest
               -------------
payable  on  this  Note  shall  accrue at a rate per annum (the "INTEREST RATE")
equal  to  the  "prime  rate"  published in The Wall Street Journal from time to
                                            -----------------------
time,  plus two percent (2%).  The prime rate shall be increased or decreased as
the  case  may  be  for each increase or decrease in the prime rate in an amount
equal  to  such  increase  or  decrease  in  the  prime  rate; each change to be
effective  as  of the day of the change in such rate.  Subject to Section 1.1(b)
hereof,  the  Interest  Rate shall not be less than six  percent (6%).  Interest
shall be (i) calculated on the basis of a 360 day year, (ii) payable monthly, in
arrears,  commencing  on  June  1,  2004  and  on the first business day of each
consecutive  calendar  month  thereafter  until  the  Maturity  Date (and on the
Maturity Date), whether by acceleration or otherwise (each, a "REPAYMENT DATE").

     1.1  (b)  Interest  Rate  Adjustment. The Interest Rate shall be calculated
               --------------------------
on the last business day of each month hereafter until the Maturity Date (each a
"DETERMINATION  DATE") and be subject to adjustment as set forth herein.  If (i)
the  Borrower  shall  have  registered the shares of the Borrower's common stock
underlying  each  of  the  conversion  of  the  Note  and  that  certain warrant

                                        1
<PAGE>
issued  to  Holder  on  a  registration  statement  declared  effective  by  the
Securities  and  Exchange Commission (the "SEC"), and (ii) the market price (the
"MARKET  PRICE")  of  the  Common  Stock  as  reported by Bloomberg, L.P. on the
Principal  Market  (as  defined below) for the five (5) trading days immediately
preceding  a  Determination  Date  exceeds  the then applicable Fixed Conversion
Price  by  at  least  twenty  five  percent  (25%),  the  Interest  Rate for the
succeeding  calendar  month  shall  automatically be reduced by 200 basis points
(200  b.p.)  (2.0.%)  for each incremental twenty five percent (25%) increase in
the  Market Price of the Common Stock above the then applicable Fixed Conversion
Price.  If  (i)  the  Borrower  shall  not  have  registered  the  shares of the
Borrower's  common  stock underlying the conversion of the Note and that certain
warrant  issued  to Holder on a registration statement declared effective by the
SEC  and  which remains effective, and (ii) the Market Price of the Common Stock
as  reported by Bloomberg, L.P. on the principal market for the five (5) trading
days  immediately  preceding  a  Determination  Date exceeds the then applicable
Fixed  Conversion Price by at least twenty five percent (25%), the Interest Rate
for  the succeeding calendar month shall automatically be decreased by 100 basis
points  (100  b.p.)  (1.0.%)  for  each  incremental  twenty  five percent (25%)
increase in the Market Price of the Common Stock above the then applicable Fixed
Conversion  Price.  Notwithstanding  the foregoing (and anything to the contrary
contained  in  herein), if the Market Price of the Common Stock for the five (5)
trading days immediately preceding the start of any such month is below the then
Fixed  Conversion  Price,  the Interest Rate for any such month will be reset to
the "prime rate" published in The Wall Street Journal from time to time plus two
percent  (2.0%).    Notwithstanding  anything  to  the  contrary  contained  in
Sections  1.1(a)  and (b), in no event shall the Interest Rate be less than zero
percent  (0.00%).

     1.2  Minimum Monthly  Principal  Payments.  Amortizing  payments  of the
          -----------------------------------
aggregate  principal  amount  outstanding  under  this  Note  at  any time  (the
"PRINCIPAL  AMOUNT")  shall begin on August 2, 2004 and shall recur on the first
business  day of each succeeding month thereafter until the Maturity Date (each,
an  "AMORTIZATION  DATE").  Subject  to  Article 3 below, beginning on the first
Amortization  Date,  the  Borrower  shall make monthly payments to the Holder on
each Repayment Date, each in the amount of $60,606.00, together with any accrued
and unpaid interest to date on such portion of the Principal Amount plus any and
all  other  amounts which are then owing under this Note, the Purchase Agreement
or  any  other  Related  Agreement  but  have  not  been paid (collectively, the
"MONTHLY AMOUNT"). Any Principal Amount that remains outstanding on the Maturity
Date  shall  be  due  and  payable  on  the  Maturity  Date.

                                   ARTICLE II
                              CONVERSION REPAYMENT

     2.1  (a)  Payment of Monthly Amount in Cash or Common Stock.  Each month by
               -------------------------------------------------
the  fifth  (5th)  business  day  prior  to  each Amortization Date (the "NOTICE
DATE"),  the  Holder  shall deliver to Borrower a written  notice in the form of
Exhibit  B  attached  hereto  converting  the Monthly Amount payable on the next
Repayment Date in either cash or Common Stock, or a combination of both (each, a
"REPAYMENT  NOTICE").  If  a Repayment Notice is not delivered by  the Holder on
or before  the applicable Notice Date for such Repayment Date, then the Borrower
shall  pay  the  Monthly

                                        2
<PAGE>
Amount  due  on such Repayment Date  in cash.  Any portion of the Monthly Amount
paid in cash on a Repayment Date, shall be paid to the Holder an amount equal to
102%  of  the principal portion of the Monthly Amount due and owing to Holder on
the  Repayment  Date.  If  the  Holder  converts all or a portion of the Monthly
Amount  in  shares of Common Stock as provided herein, the number of such shares
to  be  issued by the Borrower to the Holder on such Repayment Date shall be the
number  determined  by dividing (x) the portion of the Monthly Amount to be paid
in  shares  of  Common Stock, by (y) the then applicable Fixed Conversion Price.
For  purposes  hereof, the initial "FIXED CONVERSION PRICE" means $______ (which
has  been  determined on the date of this Note as an amount equal to the average
closing  price for the twenty (20) trading days immediately prior to the date of
this  Note;  provided  that  the initial Fixed Conversion Price shall not exceed
110%  of  the  closing price on the day immediately preceding the Closing Date).

     (b)  Monthly  Amount  Conversion  Guidelines.  Subject  to Sections 2.1(a),
          ---------------------------------------
2.2,  and  3.2  hereof,  the  Holder  shall  convert  all  or  a  portion of the
Monthly  Amount  due  on  each  Repayment  Date in shares of Common Stock if the
average  closing price of the Common Stock as reported by Bloomberg, L.P. on the
Principal  Market  for  the  five  (5)  trading  days immediately preceding such
Repayment  Date was greater than or equal to 115% of the Fixed Conversion Price,
provided,  however,  that  such conversions shall not exceed twenty five percent
(25%)  of  the  aggregate dollar trading volume of the Common Stock for the five
(5)  day trading period immediately preceding delivery of a Notice of Conversion
to  the  Borrower.  Any  part of the Monthly Amount due on a Repayment Date that
the  Holder  has  not converted into shares of Common Stock shall be paid by the
Borrower  in  cash on such Repayment Date. Any part of the Monthly Amount due on
such Repayment Date which must be paid in cash (as a result of the closing price
of  the  Common  Stock on one or more of the five (5) trading days preceding the
applicable  Repayment  Date  being less than 115% of the Fixed Conversion Price)
shall be paid in cash at the rate of 102% of the Monthly Amount otherwise due on
such  Repayment Date, within three (3) business days of the applicable Repayment
Date.

     (c)  Mandatory  Conversion.  Subject  to  Sections  2.2 and 3.2 hereof, the
          ---------------------
Holder  shall  convert  the  entire  outstanding  principal  amount of this Note
(together  with  any accrued but unpaid interest and fees hereunder) into Common
Stock if, on any date on or after October __, 2005, the average closing price of
the  Common  Stock  as reported by Bloomberg, L.P. on the Principal Market for a
period  of  five (5)  trading days preceding such date was greater than or equal
to  200% of the Fixed Conversion Price, provided, however, that such conversions
shall  not  exceed  twenty  five  percent  (25%) of the aggregate dollar trading
volume  of  the  Common  Stock  for  the five (5) day trading period immediately
preceding  delivery  of  a  Notice  of  Conversion  to  the  Borrower.

     2.2  No  Effective  Registration.  Notwithstanding anything to the contrary
          ---------------------------
herein,  none  of  the  Borrower's  obligations  to the Holder  may be converted
into  Common  Stock  unless  (i)  either  (x)  an effective current Registration
Statement  (as defined in the Registration Rights Agreement) covering the shares
of Common Stock to be issued in connection with satisfaction of such obligations
exists or (y) an exemption from registration of the Common Stock is available to
pursuant  to  Rule  144  of  the  Securities Act and  (ii)  no  Event of Default
hereunder  exists  and  is

                                        3
<PAGE>
continuing,  unless  such  Event  of Default is cured within any applicable cure
period  or  is  otherwise waived in writing by the Holder in whole or in part at
the  Holder's  option.

     Any  amounts  converted by the Holder pursuant to this Section 2.2 shall be
deemed  to  constitute  payments  of  outstanding  fees,  interest and principal
arising in connection with Monthly Amounts for the remaining Repayment Dates, in
chronological  order.

     2.3  Optional  Redemption  in  Cash.  The  Borrower will have the option of
          ------------------------------
prepaying  this  Note  ("OPTIONAL  REDEMPTION") by paying to the Holder a sum of
money equal to one hundred thirty percent (130%) of the principal amount of this
Note  together  with  accrued  but unpaid interest thereon and any and all other
sums due, accrued or payable to the Holder arising under this Note, the Purchase
Agreement, or any Related Agreement (the "REDEMPTION AMOUNT") outstanding on the
day  written  notice  of redemption (the "NOTICE OF REDEMPTION") is given to the
Holder.  The  Notice  of  Redemption  shall  specify  the date for such Optional
Redemption  (the  "REDEMPTION  PAYMENT  DATE")  which  date  shall  be seven (7)
business  days  after  the  date  of  the  Notice of Redemption (the "REDEMPTION
PERIOD").  A  Notice  of  Redemption  shall not be effective with respect to any
portion  of  this  Note  for  which the Holder has a pending election to convert
pursuant  to  Section  3.1,  or  for conversions initiated or made by the Holder
pursuant  to  Section  3.1  during the Redemption Period.  The Redemption Amount
shall  be determined as if such Holder's conversion elections had been completed
immediately  prior  to  the  date of the Notice of Redemption. On the Redemption
Payment  Date,  the  Redemption Amount must be paid in good funds to the Holder.
In  the  event the Borrower fails to pay the Redemption Amount on the Redemption
Payment  Date as set forth  herein, then such Redemption Notice will be null and
void.

                                   ARTICLE III
                                CONVERSION RIGHTS

     3.1.  Holder's Conversion Rights.  The Holder shall have the right, but not
           --------------------------
the  obligation, to convert all or any portion of the then aggregate outstanding
principal amount  of this Note, together with interest and fees due hereon, into
shares  of  Common  Stock  subject to the terms and conditions set forth in this
Article  III.  The Holder may exercise such right by delivery to the Borrower of
a  written notice of conversion not less than one (1) day prior to the date upon
which  such  conversion  shall  occur.

     3.2  Conversion  Limitation.  Notwithstanding  anything contained herein to
          ----------------------
the  contrary, the Holder shall not be entitled to convert pursuant to the terms
of  this Note an amount that would be convertible into that number of Conversion
Shares  which would exceed the difference between the number of shares of Common
Stock  beneficially  owned  by such Holder or issuable upon exercise of warrants
held  by  such Holder and 4.99% of the outstanding shares of Common Stock of the
Borrower.  For  the  purposes  of the immediately preceding sentence, beneficial
ownership  shall  be determined in accordance with Section 13(d) of the Exchange
Act  and  Regulation  13d-3  thereunder.

                                        4
<PAGE>
The  Holder  may  void the Conversion Share limitation described in this Section
3.2  upon 75 days prior notice to the Borrower or without any notice requirement
upon  an  Event  of  Default.

     3.3  Mechanics  of  Holder's  Conversion.  (a) In the event that the Holder
          -----------------------------------
elects  to  convert this Note into Common Stock, the Holder shall give notice of
such  election  by  delivering  an  executed  and completed notice of conversion
("NOTICE  OF  CONVERSION")  to  the Borrower and such Notice of Conversion shall
provide  a  breakdown  in  reasonable  detail  of  the Principal Amount, accrued
interest  and  fees  being  converted.  On  each Conversion Date (as hereinafter
defined)  and in accordance with its Notice of Conversion, the Holder shall make
the  appropriate reduction to the Principal Amount, accrued interest and fees as
entered  in its records and shall provide written notice thereof to the Borrower
within  two  (2)  business days after the Conversion Date.  Each date on which a
Notice  of  Conversion  is delivered or telecopied to the Borrower in accordance
with  the  provisions  hereof  shall  be  deemed  a  conversion  date  (each,  a
"CONVERSION  DATE"). A form of Notice of Conversion to be employed by the Holder
is  annexed  hereto  as  Exhibit  A.

     (b)  Pursuant  to  the terms of the Notice of Conversion, the Borrower will
issue  instructions  to  the transfer agent accompanied by an opinion of counsel
within  one  (1)  business  day  of  the date of the delivery to Borrower of the
Notice  of  Conversion  and  shall  cause  the  transfer  agent  to transmit the
certificates  representing  the Conversion Shares to the Holder by crediting the
account  of the Holder's designated broker with the Depository Trust Corporation
("DTC")  through  its Deposit Withdrawal Agent Commission ("DWAC") system within
three  (3)  business  days  after  receipt  by  the  Borrower  of  the Notice of
Conversion (the "DELIVERY DATE").  In the case of the exercise of the conversion
rights  set  forth  herein the conversion privilege shall be deemed to have been
exercised  and  the  Conversion  Shares  issuable  upon such conversion shall be
deemed  to  have  been  issued  upon  the date of receipt by the Borrower of the
Notice  of  Conversion.  The  Holder  shall  be  treated for all purposes as the
record  holder  of  such  Common  Stock, unless the Holder provides the Borrower
written  instructions  to  the  contrary.

     3.4  Conversion  Mechanics.
          ---------------------

     (a)  The number of shares of Common Stock to be issued upon each conversion
of  this  Note shall be determined by dividing that portion of the principal and
interest  and  fees  to  be  converted,  if  any,  by  the then applicable Fixed
Conversion  Price.  In  the  event  of  any conversions of outstanding principal
amount  under  this  Note in part pursuant to this Article III, such conversions
shall  be  deemed  to  constitute  conversions  of  outstanding principal amount
applying  to  Monthly Amounts for the remaining Repayment Dates in chronological
order.

     (b)  The  Fixed  Conversion  Price  and  number and kind of shares or other
securities  to  be  issued upon conversion is subject to adjustment from time to
time  upon  the  occurrence  of  certain  events,  as  follows:

     A.   Stock  Splits,  Combinations  and  Dividends.  If the shares of Common
          ---------------------------------------------
Stock  are

                                        5
<PAGE>
subdivided  or  combined  into  a  greater or smaller number of shares of Common
Stock,  or  if a dividend is paid on the Common Stock in shares of Common Stock,
the Fixed Conversion Price or the Conversion Price, as the case may be, shall be
proportionately  reduced  in  case of subdivision of shares or stock dividend or
proportionately  increased  in  the  case of combination of shares, in each such
case  by  the ratio which the total number of shares of Common Stock outstanding
immediately after such event bears to the total number of shares of Common Stock
outstanding  immediately  prior  to  such  event.

     B.   During  the  period  the  conversion  right  exists, the Borrower will
reserve  from  its  authorized  and unissued Common Stock a sufficient number of
shares  to  provide for the issuance of Common Stock upon the full conversion of
this Note.  The Borrower represents that upon issuance, such shares will be duly
and validly issued, fully paid and non-assessable.  The Borrower agrees that its
issuance  of  this Note shall constitute full authority to its officers, agents,
and transfer agents who are charged with the duty of executing and issuing stock
certificates  to  execute  and  issue  the  necessary certificates for shares of
Common  Stock  upon  the  conversion  of  this  Note.

     C.   Share  Issuances.  Subject  to  the provisions of this Section 3.4, if
          ----------------
the  Borrower  shall at any time prior to the conversion or repayment in full of
the  Principal Amount issue any shares of Common Stock or securities convertible
into  Common  Stock  to  a  person other than the Holder (except (i) pursuant to
Subsections  A  or  B  above;  (ii)  pursuant  to  options,  warrants,  or other
obligations  to  issue  shares  outstanding  on  the date hereof as disclosed to
Holder  in  writing;  or  (iii) pursuant to options that may be issued under any
employee  incentive  stock option and/or any qualified stock option plan adopted
by the Borrower) for a consideration per share (the "Offer Price") less than the
Fixed  Conversion  Price  in effect at the time of such issuance, then the Fixed
Conversion  Price  shall  be  immediately reset to such lower Offer Price at the
time  of  issuance  of such securities. For purposes hereof, the issuance of any
security  of  the  Borrower  convertible into or exercisable or exchangeable for
Common  Stock shall result in an adjustment to the Fixed Conversion Price at the
time  of  issuance  of  such  securities.

     D.   Reclassification,  etc.  If  the  Borrower  at  any  time  shall,  by
          -----------------------
reclassification  or  otherwise,  change  the  Common  Stock  into the same or a
different  number  of  securities  of any class or classes, this Note, as to the
unpaid Principal Amount and accrued interest thereon, shall thereafter be deemed
to evidence the right to purchase an adjusted number of such securities and kind
of  securities  as  would  have  been issuable as the result of such change with
respect  to the Common Stock immediately prior to such reclassification or other
change.

     3.5  Issuance of New Note.  Upon any partial conversion of this Note, a new
          --------------------
Note  containing the same date and provisions of this Note shall, at the request
of the Holder, be issued by the Borrower to the Holder for the principal balance
of  this  Note  and  interest  which  shall not have been converted or paid. The
Borrower  will  pay  no costs, fees or any other consideration to the Holder for
the  production  and  issuance  of  a  new  Note.

                                   ARTICLE IV

                                        6
<PAGE>
                                EVENTS OF DEFAULT

     Upon  the  occurrence  and  continuance  of  an Event of Default beyond any
applicable grace period, the Holder may make all sums of principal, interest and
other  fees then remaining unpaid hereon and all other amounts payable hereunder
immediately  due and payable.  In the event of such an acceleration, within five
(5)  days  after written notice from Holder to Borrower (each occurrence being a
"DEFAULT NOTICE PERIOD") the amount due and owing to the Holder shall be 130% of
the  outstanding  principal amount of the Note (plus accrued and unpaid interest
and  fees,  if  any)  (the "DEFAULT PAYMENT").  If, with respect to any Event of
Default,  the  Borrower cures the Event of Default, the Event of Default will be
deemed  to  no  longer exist and any rights and remedies of Holder pertaining to
such Event of Default will be of no further force or effect. The Default Payment
shall  be  applied  first  to any fees due and payable to Holder pursuant to the
Note  or  the Related Agreements, then to accrued and unpaid interest due on the
Note  and  then  to  outstanding  principal  balance  of  the  Note.

     The  occurrence  of  any  of the following events set forth in Sections 4.1
through  4.10,  inclusive,  is  an  "EVENT  OF  DEFAULT":

     4.1  Failure  to Pay Principal, Interest or other Fees.  The Borrower fails
          -------------------------------------------------
to  pay  when due any installment of principal, interest or other fees hereon in
accordance  herewith, or the Borrower fails to pay when due any amount due under
any other promissory note issued by Borrower, and in any such case, such failure
shall  continue  for a period of three (3) business days following the date upon
which  any  such  payment  was  due.

     4.2  Breach  of  Covenant.  The Borrower breaches any covenant or any other
          --------------------
term  or  condition  of  this  Note  or  the  Purchase Agreement in any material
respect,  or  the  Borrowers or any of its Subsidiaries breaches any covenant or
any  other  term  or  condition of any Related Agreement in any material respect
and,  any  such case, such breach, if subject to cure, continues for a period of
thirty  (30)  days  after  the  occurrence  thereof.

     4.3  Breach  of  Representations  and  Warranties.  Any  representation  or
          --------------------------------------------
warranty  made by the Borrower in this Note or the Purchase Agreement, or by the
Borrower or any of its Subsidiaries in any Related Agreement, shall, in any such
case,  be  false  or  misleading  in  any material respect on the date that such
representation  or  warranty  was  made  or  deemed  made.

     4.4  Receiver  or  Trustee.  The  Borrower or any of its Subsidiaries shall
          ---------------------
make  an assignment for the benefit of creditors, or apply for or consent to the
appointment  of  a  receiver  or trustee for it or for a substantial part of its
property  or  business;  or  such  a  receiver  or  trustee  shall  otherwise be
appointed.

     4.5  Judgments.  Any money judgment, writ or similar final process shall be
          ---------
entered or filed against the Borrower or any of its Subsidiaries or any of their
respective  property  or  other  assets  for more than $50,000, and shall remain
unvacated,  unbonded  or  unstayed  for  a  period  of  thirty  (30)  days.

                                        7
<PAGE>
     4.6  Bankruptcy.  Bankruptcy,  insolvency,  reorganization  or  liquidation
          ----------
proceedings  or  other proceedings or relief under any bankruptcy law or any law
for  the relief of debtors shall be instituted by or against the Borrower or any
of its Subsidiaries and if commenced against the Borrower or any such Subsidiary
shall  not  be  dismissed  within  forty-five  (45)  days.

     4.7  Stop  Trade.  An  SEC  stop  trade  order  or Principal Market trading
          -----------
suspension  of the Common Stock shall be in effect for five (5) consecutive days
or  five (5) days during a period of ten (10) consecutive days, excluding in all
cases  a  suspension  of  all  trading  on a Principal Market, provided that the
                                                               --------
Borrower  shall not have been able to cure such trading suspension within thirty
(30)  days  of  the notice thereof or list the Common Stock on another Principal
Market  within  sixty  (60) days of such notice.  The "Principal Market" for the
Common  Stock shall include the NASD OTC Bulletin Board, NASDAQ SmallCap Market,
NASDAQ  National  Market  System,  American  Stock  Exchange,  or New York Stock
Exchange  (whichever  of  the  foregoing  is  at  the time the principal trading
exchange  or  market  for  the Common Stock, or any securities exchange or other
securities  market  on  which  the Common Stock is then being listed or traded).

     4.8  Failure  to  Deliver  Common  Stock or Replacement Note.  The Borrower
          -------------------------------------------------------
shall  fail  (i) to timely deliver Common Stock to the Holder pursuant to and in
the form required by this Note, and Section 9 of the Purchase Agreement, if such
failure  to  timely  deliver  Common  Stock  shall  not  be cured within two (2)
business  days  or (ii) to deliver a replacement Note to Holder within seven (7)
business  days  following  the  required  date of such issuance pursuant to this
Note,  the  Purchase  Agreement or any Related Agreement (to the extent required
under  such  agreements).

     4.9  Default  Under Related Agreements or Other Agreements.  The occurrence
          ------------------------------------------------------
and  continuance  of  (x)  any  Event  of  Default  (as  defined  in any Related
Agreement)  or  (y)  any  event  of  default  (or  similar term) under any other
indebtedness  (following  any  applicable  cure  or grace period), the principal
amount  of  which indebtedness referred to in this clause (y) exceeds $50,000 in
the  aggregate.

     4.10 Change  in  Control.  The  occurrence  of  a change in the controlling
          -------------------
ownership  of  the  Borrower.

                           DEFAULT RELATED PROVISIONS

     4.11 Payment Grace Period.  Following  the occurrence and continuance of an
          --------------------
Event of Default beyond any applicable cure period hereunder, the Borrower shall
pay  the  Holder  a  default  interest rate of two percent (2%) per month on all
amounts  due  and owing under the Note,, which default interest shall be payable
upon  demand.

     4.12 Conversion Privileges.  The conversion privileges set forth in Article
          ---------------------
III  shall  remain in full force and effect immediately from the date hereof and
until  this  Note  is  paid  in  full.

     4.13 Cumulative  Remedies.  The  remedies  under  this  Note  shall  be
          --------------------
cumulative.

                                        8
<PAGE>
                                    ARTICLE V
                                  MISCELLANEOUS

     5.1  Failure  or Indulgence Not Waiver.  No failure or delay on the part of
          ---------------------------------
the  Holder  hereof  in  the exercise of any power, right or privilege hereunder
shall  operate  as a waiver thereof, nor shall any single or partial exercise of
any such power, right or privilege preclude other or further exercise thereof or
of  any  other  right,  power  or  privilege.  All  rights and remedies existing
hereunder  are  cumulative  to,  and  not  exclusive  of, any rights or remedies
otherwise  available.

     5.2  Notices.  Any notice herein required or permitted to be given shall be
          -------
in writing and shall be deemed effectively given:  (a) upon personal delivery to
the party notified, (b) when sent by confirmed telex or facsimile if sent during
normal  business  hours of the recipient, if not, then on the next business day,
(c)  five  days  after  having been sent by registered or certified mail, return
receipt  requested,  postage  prepaid,  or  (d)  one  day  after  deposit with a
nationally  recognized  overnight  courier,  specifying  next day delivery, with
written  verification  of  receipt.  All  communications  shall  be  sent to the
Borrower  at  the  address  provided  in  the  Purchase  Agreement  executed  in
connection  herewith,  and to the Holder at the address provided in the Purchase
Agreement  for  such  Holder,  with  a  copy  to John E. Tucker, Esq., 825 Third
Avenue,  14th  Floor, New York, New York 10022, facsimile number (212) 541-4434,
or at such other address as the Borrower or the Holder may designate by ten days
advance  written  notice  to  the  other parties hereto.  A Notice of Conversion
shall  be  deemed  given  when  made  to  the  Borrower pursuant to the Purchase
Agreement.

     5.3  Amendment  Provision.  The  term  "Note" and all reference thereto, as
          --------------------
used  throughout  this  instrument,  shall  mean  this  instrument as originally
executed,  or  if  later  amended  or  supplemented,  then  as  so  amended  or
supplemented,  and  any  successor  instrument  issued  pursuant  to Section 3.5
hereof,  as  it  may  be  amended  or  supplemented.

     5.4  Assignability.  This  Note  shall be binding upon the Borrower and its
          -------------
successors  and  assigns,  and  shall inure to the benefit of the Holder and its
successors and assigns, and may be assigned by the Holder in accordance with the
requirements  of the Purchase Agreement.  This Note shall not be assigned by the
Borrower  without  the  consent  of  the  Holder.

     5.5  Governing  Law.  This  Note  shall  be  governed  by  and construed in
          --------------
accordance  with the laws of the State of New York, without regard to principles
of  conflicts  of  laws.  Any  action  brought by either party against the other
concerning the transactions contemplated by this Agreement shall be brought only
in the state courts of New York or in the federal courts located in the state of
New  York.  Both  parties  and the individual signing this Note on behalf of the
Borrower  agree  to  submit  to the jurisdiction of such courts.  The prevailing
party  shall  be  entitled  to  recover  from  the  other  party  its reasonable
attorney's  fees  and  costs.  In  the  event that any provision of this Note is
invalid  or unenforceable under any applicable statute or rule of law, then such
provision  shall  be  deemed  inoperative  to  the  extent  that it may conflict
therewith  and  shall be deemed modified to conform with such statute or rule of
law.  Any  such provision which may prove invalid or unenforceable under any law
shall  not  affect  the  validity  or  unenforceability  of  any other provision

                                        9
<PAGE>
of  this  Note.  Nothing contained herein shall be deemed or operate to preclude
the  Holder from bringing suit or taking other legal action against the Borrower
in any other jurisdiction to collect on the Borrower's obligations to Holder, to
realize  on  any  collateral  or  any other security for such obligations, or to
enforce  a  judgment  or  other  court  in  favor  of  the  Holder.

     5.6  Maximum  Payments.  Nothing  contained  herein  shall  be  deemed  to
          -----------------
establish  or  require  the  payment  of  a rate of interest or other charges in
excess  of  the maximum permitted by applicable law.  In the event that the rate
of  interest  required  to be paid or other charges hereunder exceed the maximum
permitted  by such law, any payments in excess of such maximum shall be credited
against  amounts  owed  by  the  Borrower to the Holder and thus refunded to the
Borrower.

     5.7  Security  Interest  and  Guarantee.  The  Holder  has  been  granted a
          ----------------------------------
security  interest (i) in certain assets of the Borrower and its Subsidiaries as
more  fully  described  in  the  Master  Security Agreement dated as of the date
hereof  and  (ii)  pursuant  to  the Stock Pledge Agreement dated as of the date
hereof.  The  obligations  of  the  Borrower  under  this Note are guaranteed by
certain  Subsidiaries  of the Borrower pursuant to the Subsidiary Guaranty dated
as  of  the  date  hereof.

     5.8  Construction.  Each  party  acknowledges  that  its  legal  counsel
          ------------
participated in the preparation of this Note and, therefore, stipulates that the
rule  of  construction  that ambiguities are to be resolved against the drafting
party shall not be applied in the interpretation of this Note to favor any party
against  the  other.

     5.9  Cost  of  Collection.  If default is made in the payment of this Note,
          --------------------
the  Borrower  shall  pay  to  Holder  reasonable costs of collection, including
reasonable  attorney's  fees.

       [Balance of page intentionally left blank; signature page follows.]

                                       10
<PAGE>
     IN  WITNESS  WHEREOF, the Borrower has caused this Convertible Term Note to
be signed in its name effective as of this 27th day of April 2004.

                                        SEQUIAM  CORPORATION

                                        By:________________________________
                                        Name:______________________________
                                        Title:_____________________________

WITNESS:

_______________________________

                                       11
<PAGE>
                                    EXHIBIT A

                              NOTICE OF CONVERSION
                              --------------------

(To be executed by the Holder in order to convert all or part of the Note into
Common Stock

[Name and Address of Holder]

The Undersigned hereby converts  $_________ of the principal due on [specify
applicable Repayment Date] under the Convertible Term Note issued by SEQUIAM
CORPORATION dated April 27, 2004 by delivery of Shares of Common Stock of
SEQUIAM CORPORATION on and subject to the conditions set forth in Article III of
such Note.

1.   Date of Conversion       _______________________

2.   Shares To Be Delivered:  _______________________

                                        By:________________________________
                                        Name:______________________________
                                        Title:_____________________________

                                       12
<PAGE>
                                    EXHIBIT B

                                CONVERSION NOTICE
                                -----------------

(To be executed by the Holder in order to convert  all or part of a Monthly
Amount into Common Stock)

[Name and Address of Holder]

Holder  hereby converts  $_________ of the Monthly Amount due on [specify
applicable Repayment Date] under the Convertible Term Note issued by SEQUIAM
CORPORATION dated April 27, 2004 by delivery of Shares of Common Stock of
SEQUIAM CORPORATION on and subject to the conditions set forth in Article III of
such Note.

1.   Fixed Conversion Price:  $_______________________

2.   Amount to be paid:       $_______________________

3.   Shares To Be Delivered (2 divided by 1):  __________________

4.   Cash payment to be made by Borrower :    $_____________________

Date: ____________                      LAURUS  MASTER FUND, LTD.

                                        By:________________________________
                                        Name:______________________________
                                        Title:_____________________________

                                       13
<PAGE>

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